Be careful what you spend these days when you are thinking about remodeling your house.  Home values are down and so are the recovered costs of remodeling.  In 2005, at the peak of the real estate market, approximately 87% of the cost of a remodel would be recouped in the sale of a home.  Today’s real estate market is recovering approximately 64% of the remodel costs.  Everybody is watching their wallets, so if you are considering a remodel think carefully. While remodel costs are down it is important to remember that home values are down too.  Unless you want to stay in your home for a long time you cannot count on recovering costs of a major remodel. The most cost effective remodel items today are: Roofing, siding, windows, and doors.  Similarly, redoing a basement or attic is recommended instead of adding an addition.  These items are recommended because a seller will recoup a greater percentage of the cost when they sell their home. For more information on current cost versus value have one our of Four Seasons agents view your home.

Foreclosures are expected to subside in the coming year

The latest data released by UFA L.L.C., a firm located in Ann Arbor Michigan that researches mortgage activity, states that foreclosures are expected to decrease in the next year.  After four years on the rise there is no doubt that it will be nice to see foreclosures start to subside. Improvements in the foreclosure arena are seen linked to tighter lending practices, home prices stabilizing, and an improving economy.  The one element working against foreclosures is the increasing unemployment which will leave some without the ability to make their mortgage payments. The onslaught of no-doc loans and inflated home prices led to four years of increasing foreclosures.  The decline of real estate values is largely attributed to an elevated rate of foreclosures.  A decrease in foreclosures will be a welcome sign for a real estate market that has seen better times. To view all the properties listed for sale in the Great Smokies click here.

Being a landlord can be easier that you think.  Many people are holding on to their real estate these days, some by choice, because they are waiting for a stronger market, and some by necessity, those that simply cannot sell their homes.  What this means is that there are many first time landlords out there, a job that can be a bit daunting, especially if you don’t live near your property.

If you are lucky being a landlord is easy and you get a monthly check with no real involvement.  Many landlords have a more difficult time however, chasing down rent, making repairs and having to constantly oversee their tenants and their properties.

Here in Sevier County, more specifically Gatlinburg & Pigeon Forge, being a landlord can be surprisingly easy. One of the many companies who manages the overnight rentals that dot the mountains in our area is Chalet Village Properties. Management companies like Chalet Village take care of everything from advertising, leasing, cleaning and general maintenance of the overnight rentals.

Another thing management companies do that makes our job selling real estate much easier is to document the rental incomes of the properties for sale. This documentation makes it much easier for a buyer to decide which rental property is the right choice for them.

The biggest question hovering around these days is, have we hit bottom?  Whether this question be a general question regarding the recession or the real estate market, we have to ask does it matter?  Whether we hit bottom a couple of months ago or are going to hit it a couple of months from now, we can all agree that we have had better times and better times are in our future.  Whether we have hit bottom or not there is no mistake that it is a buyer’s market when it comes to real estate.

That being said, if we haven’t hit bottom then the bottom must be close.  Wouldn’t it be better to buy near the bottom than miss it entirely?  Across the Country there are markets that are on their way down, markets that have stabilized and markets that are on their way back up.  Whether the market hit bottom a couple of months ago, is at the bottom now, or will hit the bottom in a couple of months, the top of the market is far away.

It is a buyer’s market out there.  Whether you are looking for a primary residence or a second home it is a great time to invest in real estate.  Property values are lower than they have been in years, interest rates are still hovering at 30 year lows and some tax incentives make buying real estate today more affordable than it has been in years.  For all we know the real estate market might be more affordable today than it will be for many years to come.

To search for properties listed in the Great Smoky Mountains (and find that deal at or near the bottom of the market) click here.

The rent-to-own scenario can work out for both the buyer and the seller

The real estate market has led to some creative financing techniques, one of which is a rent to own scenario.  I've noticed that here in Sevier county we're seeing more retn-to-own scenarios proposed to sellers and to buyers who may have trouble getting a loan in todays' tough lender marekt. While rent-to-own has been around for a long time, today it is helping many nervous sellers get a deal done.  In essence the rent-to-own scenario is seller financing.  It is important to work the specifics out in a rent-to-own situation.  Items that need to be addressed are:

• The percentage of the rent that goes toward the down payment
• Which party pays for major repairs to the home
• Which party takes care of the basic upkeep of the property
• What happens to the down payment money if the buyer changes his mind

A typical rent-to-own scenario takes a portion of each months rent to put toward a down payment on the home.  As soon as the down payment money is collected and reached its goal then the potential buyer can qualify for a mortgage.  The seller has to cover his bases so that he is not out if the buyer changes his mind while at the same time a buyer has to look out for his best interest as well.  If planned accurately and followed through diligently the rent-to-own scenario can work out well for everyone.

The news is more and more positive across the Country, home prices have risen for three straight months and the number of sales have increased for four straight months.  Great news?  Any positive news is great after the real estate market our Nation has been weathering.  However, real estate values are hardly skyrocketing and, while increasing, sales volume is hardly knocking homes off the shelf.

It is a buyers’ market, there is no doubt about it and the buyers getting the best deal are those buying luxury real estate.  Luxury homes have had the biggest drops in pricing and for those with deep pockets the savings can be tremendous.

A recent article in the Wall Street Journal points out the significant drop in price among luxury real estate.  Data is showing that while mainstream home prices are stabilizing, luxury real estate, homes selling for $2 million or more, are dropping their asking prices an average of 14%.  The article states, “Bottom line: At the high end, it’s a good time to be shopping for that dream home.”

If you have been dreaming of luxury real estate and have the money, this could be the time to make your dream come true.
Click here to visit the our web site and view some luxury properties in the Smokies.

Short sale & REO properties can make great investments

Short Sale and REO properties make great investments here in Gatlinburg but they are each unique and require some attention to get the deals completed.  Todays real estate market is full of bargains and whether the property is a fire sale on the owners behalf, a short sale or an REO there are plenty of properties out there which make sense for the buyer.  The complication is often getting the deal done.  Whether it is getting a contract accepted, attaining financing or following through until closing a lot of todays deals require the assistance of a real estate professional more than ever. What are the main differences between REO properties and Short Sale properties? REO properties are owned by the lending institution, typically a bank.  REO properties have been repossessed and the home owner is out of the picture.  REO properties are being sold by a broker division of the bank or by a Realtor hired by the bank.  The bank is in the drivers seat and rarely wants to make any improvements or deal with inspection items, preferring to sell a property “as-is”. A Short Sale is a pre-foreclosure sale when the home owner (borrower) is still in the picture but owes more than the house is worth  In this case the lender is involved because the lender has to agree to the sale rice and the loss that they are going to take.  There may be some room for inspections and contingencies in the short sale scenario but the bank still has the last word and to get a deal done a buyer must be willing to forgo certain issues. In either case, REO or Short Sale, a real estate professional who has experience or knowledge in distressed property can be incredibly useful.  These real estate deals are complicated and take knowledge to complete.  Contact an experienced real estate broker today to see what is going on in your local real estate market. For more information on REO and Short Sale properties check out Realty Times by clicking here.

Investing in REO/foreclosure properties may seem like the thing to do these days but just because a property is being sold at a bargain price doesn’t necessarily mean it is a bargain. The number of foreclosed properties has increased dramatically over the past year and the number of bank owned properties is not yet diminished. It is important to remember that the banks or lenders that have the property on their books want to unload it. What does this mean to you? Cash offer wins. If you need to get a loan to purchase the property then you could be waiting a few weeks to acquire financing. It's important to become pre-qualified prior to viewing homes for sale so that you may act quickly if the right one appears. If someone else has their eye on the property and walks in with cash you will be out of luck. No money, no property. The bank doesn’t care if you get the property or not, they just want the property off their hands. If you are looking to buy an REO property for an investment be aware of two factors: condition and location. Just because a property is inexpensive does not mean that it will make a good investment. Have your Century 21 Four Seasons agent provide a complete CMA prior to submitting an offer to purchase. Is it in a good location? Remember that location matters, whether you will be living in it or not. What is the condition of the house. When it comes to REO property many times you will not be allowed in for an inspection and buying sight unseen can be a real gamble. Do some research and find out what you can about the property before committing to buying it. Your Century 21 Four Seasons agent can help you select the right contractors and inspectors. Certainly buying REO property can be a good investment but it can also be a risky one. Do your homework and have the right real estate partner/agent to make your purchase a success.

There are many questions when it comes to investing in real estate today one of which is, is it a good time to invest in vacation real estate? Currently it is a buyer’s market almost anywhere in the Country, as well as many locations overseas. If you can acquire financing or have the extra cash to invest real estate has always been seen as a good investment because while it may take its dips, historically it has always rebounded. Many signs point to it being a great time to invest in vacation real estate. These signs include:

• Low interest rates

• A drop in home values

• Fewer buyers, therefore less competitive market place

• Lower property taxes due to drop in home values

• Higher inventory, therefore more homes to choose from

 

If you have been wanting to purchase or invest in a second home in Gatlinburg or Pigeon Forge there hasn’t been a more attractive time to purchase vacation real estate in quite some time.

 

There’s a bit of urgency now when we speak about the First Time Buyer Tax Credit. Mostly because it will be over by the end of November. Secondly, the Federal Reserve has given some indication, according to economist, that it may raise the prime lending rate at the end of September. If the prime lending rate increases, it could signal an increase in home lending rates as well (even before the deadline to purchase).

It can take 30 to 45 days to close a loan, so to take advantage of the tax credit most people will need to have their property under contract by the middle of October.  

There is no doubt that the first time home buyer tax credit is a great thing but there are a few things to know before you assume that you qualify for the full $8,000.  The tax credit breaks down as follows:
Who qualifies? First time home buyers and people (or spouses) who have not owned a home for the previous 3 years.  You must purchase your home between January 1, 2009 and December 1, 2009.

• What qualifies for the first time home buyer’s tax credit? Only a primary house qualifies.  It does not matter if it is a single family home, duplex, townhome, condo, apartment or co-op, if it is a primary residence it will apply.

• What is the amount of the first time home buyer’s tax credit? $8,000 is the maximum amount of the credit.  There are 2 factors at play when it comes to getting the credit: The cost of the home and the income of the person or married couple purchasing the home.  The credit can be 10% of the closing price up to $8,000 or a person making $75,000 or less or a married couple making $150,000 or less are eligible for the full $8,000.

• Do you qualify for the first time home buyer’s tax credit if your income is higher? Yes and no.  If you make more than the $75,000/$150,000 limit you get less of a credit.  The maximum income is $95,000 for singles or $170,000 for couples.  If you make more than the maximum income you are not eligible for the tax credit.

The tax credit is a real boon for first time home buyers and does not have to be repaid.  If you qualify for the tax credit and have been considering purchasing a new home there could not be a better time.  Low interest rates, low home values and the first time home buyer tax credit all add up to the right time to call your experienced Century 21 Four Seasons Realtor.

Resource and for more information: Realtor