Getting ready for Christmas,

Although Christmas is still two weeks away, planning for the whole family to come home for Christmas began the Saturday after Thanksgiving. Of course that meant I was going to have to organize, sort, reorganize and file the numerous stacks of paperwork I had sitting on nearly every table, corner and countertop around our home. Obviously I had promised I would get it done before everyone arrived, but it's still stressful. At this point I would say I am about 40% into the job and it's starting to look pretty nice. I'm getting lots accomplished. I suppose it's not as stressful as I had once thought.

Also, I’m still working as hard as ever with my real estate listings and sales. With everything going on in the economy, I know it’s still difficult for buyers and sellers to think forward but it’s really an excellent time to buy that smaller or larger home. In our area, prices are below 2006/2007 prices and interest rates are at the lowest point in nearly two years. In my book that amounts to a win-win for everyone.

But, some sellers are thinking, “I don’t want to give my home away.” Although I really don’t know exactly what that means, I think it means ‘I won’t sell my home for less than what I feel it’s worth.’ Except the workings of the market tells us the value of a home. It’s not some conjured dollar amount a seller really feels strongly about. That’s why, in our market area, those home which are actually being sold are homes which have been reduced to the point where the market meets the expectations and capabilities of the available buyers. Now it’s true that some homes sell for more than what most of us believe is market value. Yet, in those rare cases, there is something unique or cute about that property where its market appeal just simply exceeds the overall market. All of the rest have to be competitively priced according to location, size and features in order to find that special qualified buyer.

Of course, qualified means one having an acceptable credit score. Except now isn’t the right time to get me started on the virtues of credit scoring. I’ll speak more on that topic another time.

Now, getting back to why now is a great time to buy, let’s assume that two/three years ago a house sold for $300,000 and it’s now available for $225,000. Let’s also assume it is your home which you won’t give away. But in this hypothetical situation you sell it and purchase a home which sold for $700,000 two/three years ago for $525,000. Let’s figure this out. On the sale of your home you lost $75,000. But on the home you purchased, you saved $125,000. Isn’t that a savings of $50,000? Both scenarios assume the very same 25% loss of value.

As for the financing, if it was 6% or more two/three years ago and it’s now just over 5%, on a $500,000 note that’s an additional savings of $416.67 per month. (6% minus 5% = 1% times $500,000 equals $5,000 divided by 12 months in the year is = to $416.67 per month)

It’s not just a good time to buy, it’s an excellent time. So get off the couch and give me a call at (253) 370-5626 and I’d be happy to work and compare the specific numbers to your situation.

As to my continued Christmas preparation, I was only interrupted once in preparing this blog. My wife wanted me to help bring in the groceries and she wanted me to go with her to pick up a new mattress and box spring. Lucky for me she let me come back and finish. I do love Christmas, especially with everyone coming home. I am not a shopper though. But my wife loves it. In exchange I rub her feet. We make a good pair.

Until next time, Merry Christmas and happy house hunting to all.

Was it a good buy?

Good morning! Yes, I realize my commitment to blog more often has yet to be realized. However, those topics which I have chosen to comment about have been very timely and on target. It’s not so much that I don’t want to contribute regularly. Instead it’s just that I just feel totally stretched with my real estate sales and by the time I could be blogging, I’m asleep in my recliner.

Anyway, in my last blog I mentioned that I was recommending that homebuyers first determine what they can qualify for coupled with what they are actually willing to pay for house payments. Next, determine how much home those payments will support. And finally, buy the least expensive home in the nicest area available. This seems relevant to restate because yesterday a coworker mentioned that a buyer who had considered one of her listings had instead made an offer on a property she described as, “the most expensive home in a neighborhood of less expensive properties.” She further added that the buyers wanted a home that had been totally remodeled; a home they could move into and begin enjoying immediately.

As I listened to my associate’s story, I couldn’t help but think that that was exactly the opposite of what I have been recommending. Perhaps they hadn’t read my blog. Unfortunately, being the observer of human behavior that I am, I believe they, like so many buyers today, feel there isn’t time to give perfection to an imperfect home. They feel they are just too busy making a living and taking care of their families to add anything extra. And while I would like to disagree, that attitude does make sense. I’ve often made the same analysis when comparing those who are able to participate in political activities to those who are just too busy making a living and raising kids.

But, just because it makes sense doesn’t mean it’s the best approach to buying a home. However, I don’t have to make their house payments or worry as to whether I’ll have enough equity in two to three years when my family needs a larger home or a transfer is in the works. I’m figuring that, in years to come, a typical homebuyer will have to live in a property at least three years in order to break even. Unfortunately, breaking even in three years becomes increasingly difficult when one buys the most expensive home in any neighborhood.

On the news front, the State Legislature has enacted legislation aimed that unlicensed flippers. Although there currently doesn’t appear to be any teeth in the new law, it is a step in the right direction. Also those salespeople targeting homeowners in default have come under the scrutiny of the legislature. More details will be forthcoming.

Until then,

Do Good ….. BE GREAT ….. 110% …..

Simple Advice

Some simple advice about your next home purchase.

#1. Meet with and discuss your finances with an established lender to determine how much of a home you can purchase and to decide how much of what you can afford you are actually willing o commit to a new house payment. Determine the specific price range you want to consider. Basically, it’s getting your financial house in order. Personally, I would suggest you stay away from the lenders who are advertising on local radio and television stations. Talk with someone you trust and see who they might recommend or be willing to refer you to see. If something sounds too good to be true, trust your instincts. But, most importantly, be patient.


#2. Get acquainted with a good Realtor. Obviously, for selfish reasons I would hope that would be me. In fact I was referred to as the "Better Broker" yesterday by a peer. It was very flattering.

#3. Look for the least expensive home in the nicest neighborhood which is within the price range you have determined you want to consider. Review the statistics of the neighborhoods you are considering and only consider homes which are at or below the medium price of the homes in any given neighborhood.

Actually these rules are not my own and I don’t really remember where I first heard them. But they make good financial sense. In our world today, too many buyers are only willing to accept something new or perfect or remodeled and end up paying well beyond the medium price for the location they have chosen. In those cases, if you do end up having to sell within the first few years of your ownership, your home should be easier to sell. Again, to review the benefits of home ownership please refer to my previous blog entries.

Thanks for showing up and do have a great day always remembering to:

Do Good ….. BE GREAT ….. 110% …..

Happy Tuesday Greetings

Well, it's Tuesday and I'm off to a meeting. Again I must apologize for being an irregular blogger. My real estate work has been a priority. Sales and listings are more difficult to get and keep together. Consequently, I am spending every available minute talking and communicating with friends, acquaintances, even strangers; time which keeps me away from blogging.

But, having been through real estate markets like this, I know that eventually it will all work out. I'm keeping the faith and working diligently each and every day.

I hope you're also in good spirits this fine day and off to do good things and seek great accomplishments. I wish you good luck. Good luck to all of us.

Do Good ..... BE GREAT ..... 110% .....

What is your Realtor doing for you today?

I had the brainstorm of writing today about “What’s your Realtor doing for you today?”

This is a significant topic because, with unsold listing having been on the market for longer than six months, I believe every seller would want to know exactly that. But, the fact of the matter is, beyond advertising, socializing and kibitzing with friends and clients, I’m not really sure most Realtors are doing much to directly benefit the interests of the sellers they represent.

Real quickly, before I get too far, let me go back for just a second. In my last Blog I wrote that not all real estate agents were Realtors and agents who were also Realtors should be held in higher esteem than others. If for no other reason, this is significant because Realtors have agreed to uphold a higher set of standards than non-Realtor agents. Those standards are intended to benefit buyers and sellers alike. Plus, the National Association of Realtors is working very hard to uphold and protect the rights of private property owners and we, as individual Realtors, contribute mightily to such efforts; rights which many of our elected officials are attempting to erode and take away from us.

Now, back to the matter at hand, “What’s your Realtor doing for you today?” Well, in my own case, I’ve had to get as far outside of the box as I could. At times, it would seem like there was nothing that was working. Newspaper, internet and specialty advertising, despite costing a fortune, wasn’t working. Interestingly enough though, buyers are continuing to buy and sellers are continuing to sell. But, since I am dedicated to helping my sellers find buyers who will love and enjoy their properties as much as they do, I felt I had to do something. But, where to begin? Back when I first started in real estate, just out of college, I always said I the more creative I was the more I helped my clients.

Consequently, this is one thing I’m now doing for a property owner in the Spanaway area of south Tacoma, Washington. Their home is an estate quality property with two plus acres, a private pond, creek frontage, a lovely two story main dwelling and a guest house. In reviewing their general neighborhood, I’ve found numerous similar properties. In a letter I have been sending to many of those similar property owners, I write:

“The intent of this letter is simply to introduce you to a nearby property which is listed and available for purchase. Being that it is also on acreage, it is similar to your property. To some degree, I sense that properties like yours have an estate quality and offer prospective purchasers a unique opportunity to be close-in yet somewhat removed and secluded.

“It is exactly that sense which has encouraged me to write to you. No, my interest here is not your property. Instead my interest is the possible contacts or acquaintances you might have who may have suggested at some point that they too would be interested in a property like yours, if only the right one were available. Consequently, I submit to you the attached information about my listing at 14520 11th Avenue Court East.

“Despite what the media reports, buyers are still buying and sellers are still selling. In most cases, it’s simply a matter of finding the market. Originally licensed in 1972, I have been through markets like this before and I can assure you, it’s not all doom and gloom. For your convenience I’ve also enclosed information about myself.

“If you’re unaware of anyone who might enjoy and value my listing, I appreciate your consideration. However, if you have friends who would also like to deal with a professional and experienced Realtor in other matters, I would appreciate the referral. Again, I thank you for this opportunity to be of service to you.

“My warmest regards,

“Kenneth C. Thiemann, Assoc Broker / WA State Certified Appraiser
“Personal Cell Phone (253) 370-5626”

Along with the letter I am including information about myself and an informational flyer about the property.

Where many agents are simply interested in getting and maintaining more listings, I feel I am actually doing something positive to benefit the interests of my seller.

Anyway, thanks for dropping by and I hope you have a great day. Always remember to:

Do Good ….. BE GREAT ….. 110% …..

Sales Still Happening - Home Ownership Benefits

Blog for 02-11-08

Although the market has slowed, it’s impossible to ignore the fact that homes and properties are still being sold and buyers are still buying. And no, no one appears to be stealing anything. No theft involved. Obviously there are still those who understand the benefits of home ownership.

Okay, let’s review. The benefits of home ownership include:

1. You have the choice to repaint the colors you like or relocate or enlarge rooms to make the space more pleasing and livable. Tenants are rarely given the option of making such changes.
2. With a fixed rate loan, it’s a guaranteed savings program. While very little is applied to principle initially, a portion of every payment represents debt reduction and, over time, it increases with each payment that is made. In a rental situation, a tenant pays rent and the landlord benefits from the debt reduction on his loan.
3. Over the long run, homes typically appreciate in value, typically at 2% -to- 3% annually. While the amount varies, over a period of 30 or 40 years, nearly every home in America has benefited from appreciation. In fact, in 1972, appreciation was considered a function of inflation. Regardless of the amount, appreciation or inflation will help to increase ones equity position. Simply put, equity can be defined as current value less mortgage balance owing. However, it is important to remember that when selling a property, ones equity is reduced by the selling costs applicable to that specific sale. I’ll try and address that more at a later time. Appreciation doesn’t apply to tenants.
4. And, speaking of inflation, the amount that one borrows to purchase a property today is typically repaid in dollars that are worth less as each successive payment is made. Rent is what it is; rent.
5. Although it will vary with each property owner, each will speak of an intrinsic value or security that property ownership provides. This is something very difficult to measure, but it always seems to exist. For my family, purchasing property in a specific location provided my children access to the schools we thought would give them the best education. Unknown to us at the time, it also gave them a great sense of worth because their parents were property owners. I’d like to see someone attempt to measure that benefit

Let’s talk more about appreciation or inflation. If one purchased a property with 100% financing and an interest only loan, the home would have to increase in value roughly 9.3% in order for the owner to breakeven upon its sale. Of course, that assumes that the owner would utilize the professional services of a Realtor. In the typical world, based on the typical appreciation or inflation, one would have to continue owing that property for at least three-to- four years in order to breakeven. This is important because there seems to be a lot of purchasers who believed their purchase today meant instantaneous profits tomorrow.

The point here is that purchasers were buying real estate, not for the benefits of owning that property, but instead because they believed that real estate was a certain means to instant riches. Fixers and foreclosures became the envy of every so called investor. Or, If only one could purchase a property with two lots from an unsuspecting seller so they could make a killing selling them separately in a simple legal procedure. Of course the market took a turn and many unsuspecting investors have been left holding an empty bag of equity. Many years ago I learned an important lesson; that you couldn’t eat equity; it simply didn’t provide the nourishment to sustain life. In that sense, until sold, equity was an intangible.

Speaking of homes with extra lots, I have a story. I’ve represented sellers twice where they legitimately had two lots that could be legally separated very easily and inexpensively. In the first case, the property owner was having great difficulty emotionally making the transition from one home to another. When I explained the benefits of separating the two lots and selling them individually for more money, he emphatically said that he didn’t want to deal with the bother or the strain. It was his choice and consequently a builder bought the property, split the lots, rented one and built a new home which was eventually sold on the other.

In the second instance, I informed my prospective seller that there was a definite benefit if he split the lots before we put them on the market. He followed my advice and his home was sold to one buyer and the vacant lot was sold to a different buyer who eventually built and sold a new home constructed on the vacant site. This is an important story because it goes to the matter of honesty and integrity; things which I have patterned my entire life around.

Obviously, there is continued vitality in property ownership. But we as Realtors need to go back to the basics and promote the greater values of property ownership rather than simply selling it as a quick and easy way to untold riches.

Throughout my blog today, I have mentioned Realtor, not real estate agent. This is an important distinction that very few Realtors make. In short a Realtor is one who has pledged to abide by a higher set of standards and ethical obligations than what is required by the state for other licensed agent. Therefore, as a Realtor, I’m better than a non Realtor agent. Plus Realtors, through their dues, work continuously to promote and protect the interests of property ownership.

Anyway, I’ve been busy; spending countless hours crafting words together hoping that a meaningful and striking mosaic would result. My goal has been and will continue to be to help my sellers sell their property and to provide my buyer clients the opportunity to purchase the homes and properties of their dreams.

Again, I thank everyone who has contacted me. I believe I have continued to be successful in responding to every one of you. And as your week continues, remember to always:

Do Good ….. BE GREAT ….. 110% …..

Working to Achieve Success for my Clients!

Well, here I am again; untimely as ever. Except, I have an excuse. Current real estate market conditions have kind of gotten in the way and necessitated that I spend my writing time, writing time previously devoted to writing in my blog, actively pursuing my real estate business. Despite all of the negative talk about the market, there are still sellers who have to sell and buyers who have to buy and they deserve the best representation available. But, everything has become harder, requiring more time and patience than ever before. Consequently, I have deliberately chosen to continue to provide the best representation and service that is humanly possible to my clients. On the other hand, such a commitment has left a visible void in my blog. Not to worry though. I have been able to respond to everyone who has contacted me personally about their real estate needs and questions. Once again, I’m extremely happy to report that that is a positive.

Although not attributed to anyone specifically, on my shelf there is a picture of a young person riding a bike through the woods with the words “To achieve, you must believe something and want something with all your might. Then, you must be willing to commit yourself to a course.” Those words and the picture are from an old page calendar providing different thoughts for each day. I recite that because, with so many negative things going on all around us, I see more and more people needing encouragement in their lives.

But if you think about those words, “To achieve, you must believe,” they really are true. One has to believe something is possible before one can attempt to work toward achieving it. On my file drawer I have the words, “Believe and Succeed” written. There is also a page with the words, “If you can’t believe it, you can’t achieve it.”

I suppose you could say that my thought for today is, this is the first and best day of the rest of your life. If there is something you have been dreaming about but have lacked the confidence or strength to commit to it, look at yourself in the mirror and repeat, “Today is the first and best day of the rest of my life. I can do and accomplish anything I commit all of my energy and attention to achieving. I can do it.”

Thanks again for stopping by and have a great and wonderful day. But always remember to

Do Good ….. BE GREAT ….. 110% …..

Real Estate, Homes & Fixers

Although it has been several weeks since my last post, I’ve been constantly thinking and reviewing what information, beyond what is provided daily in the newspaper or other media, would be useful and meaningful. Quite honestly, I’ve actually been overwhelmed with all of the various alternatives.

To begin with, what is commonly referred to as “fixers”, I want to relate a conversation I had with a former builder who now purchases homes in poor condition and gives them a facelift. What this particular former builder told me was that he no longer had the insurance required to be a builder but, by buying “fixer” homes and giving them a ‘like new’ appearance, insurance wasn’t required. Obviously not all people engaging in “fixers” are former builders. Yet, when looking at a home that has been rehab’d, does anyone ever know the level of knowledge or skill the person had who completed the work? Were permits required? Was there electrical or plumbing work completed that is now hidden behind nicely textured and painted walls? The point here is not to belittle or defame “fixers” as bad. It’s simply to caution the public to take care in knowing what they are buying. Until the recent slowdown of appreciation, “fixers” supposedly made a lot of money for what seemed like little risk. Granted, they seemed to fill a need for housing that looked perfect and therefore became more appealing to home buyers who wanted a cute house which didn’t require any work. However, buyer beware, a superficial facelift doesn’t make a new home or condo. What happened to sweat equity?

Regarding credit scoring, which I believe was originally intended to make our society color blind, it is now being extended to real estate home loans. Of course it has always been applicable to real estate loans. Except now, home buyers with lower credit scores will pay an additional quarter percent, possibly more, than buyers with higher credit scores. Also I learned yesterday that private banking, in addition to dealing with high asset clients, is able to continue lending to high profile borrowers with larger than typical debt regardless of their credit score. I guess the point here is the public, especially the average people, needs to be more aware that greater opportunities will be available to those who are able to accumulate assets while retaining a higher credit score.

And that brings me to my next point. What is a home and why buy it? Obviously is home is somewhere to live and a lot more. This question has been a concern of mine for some time. Too many people seemed to be buying homes with the overriding expectation that prices would continue to rise at unprecedented rates forever. Plus many buyers were relying on 100 financing in order to complete the purchase. Of course when home prices stopped accelerating and a move or relocation was required, it isn’t too difficult to see what drama would occur with the home buyer who is now a seller. I hope that seller has deep pockets. Oh yes, there could maybe be a “Short Sale” in their future. But that’s an entirely different topic that will be considered another day.

Getting back to my point about a home, it would seem to me that a home is a place which offers security and protection to the home buyer. It is also a place where asset growth can occur. Short-term, no! Long-term, the answer has to be yes. Thirty-five years ago we counseled home buyers that, in order to break even on their home purchase, they needed to stay or keep a property at least 2-to-3 years. We’re likely at that point again. Yet the advantages of owning rather than buying are staggering. As a homeowner, if you don’t like the color of a room, you can change it without consulting with a rental management company or a landlord. If a faucet begins to leak, no problem, just go to Home Depot, get the parts and fix it yourself. If you want to remodel and add a room so you don’t have to move, do the work yourself or hire a contractor to assist you. Perhaps we need to be more concerned about the advantages of home ownership rather than whether prices are up or down on any particular day, month or year. Believe me, as a homeowner, despite period of slowdowns and low appreciation rates, the long-term prices of real estate has always grown. And it always will. You see, there is only so much land.

Anyway, I’ll try to be more diligent about writing to my blog and I won’t let things build up inside where I feel so overwhelmed. Thanks for reading and do have a great day. Speaking of having a great day, I sense that too few of us ever get the encouragement we need in order to fully have a great day. I hope that each of you will come to recognize the great potential that lies within you and decide to fully and completely use it to make your day great. In working toward your goal, please remember to:

Do Good ….. BE GREAT ….. And always give 110% in all that you do …..

Now, go out and have a “Great Day!”