Remember When REO Used to be a Rock Band?

In the early 1980’s, when someone was talking about REO they probably meant REO Speedwagon not a home owned by a bank. Yep, back in the day when many of my friends and relatives were buying their first house, few thought a foreclosure home was a good deal. There was a section in the paper at the time for HUD homes. They were all dumps in the minds of buyers. It was deemed “too risky” to buy a bank owned home. Better to leave those houses for an investor.

In 1981 when REO (the band) was tearing up the charts with the now oldie but goodie rock tune, “Keep on Lovin’ You”, interest rates were 17%. That’s not a typo…Seven-TEEN percent! Geez…it’s a wonder anyone bought a house in the 1980’s!

Back in the days of big hair and parachute pants, first time buyers had to scrimp on hairspray to save for a down payment AND closing costs. Sellers might pay a point or two to help bring down the interest rate but they rarely wanted to pay closing costs AND points. So a first time buyer needed to have thousands to put down on their first home.

There was no internet back then either so with REO belting out “Take it on the Run” on the cassette player, buyers would traipse around town with the Sunday open house ads looking to find a home. When they stopped in to talk to a friendly REALTOR®, there was no required agency disclosure. The buyers were supposed to instinctively know that the agent worked for the seller. Almost all agents were under contract to work in the best interest of the seller in those days no matter how nice the agent seemed to treat the buyer.

And believe it or not, despite all the cards stacked against them, many, many people bought their first homes in the early 80’s—It was the American Dream after all!

FLASH FORWARD to TODAY
When someone is talking REO now, they are more than likely talking about Real Estate Owned by a bank. These foreclosed homes are no longer thought of as dumps for investors to deal with; they are opportunities. These homes are sold as-is but many are in amazing condition and at tens of thousands less than the homes sold for just a year or two ago. Some homes are even new construction.

Can you say affordability? It is off the charts when you consider a foreclosed home! Check out this video which explains the 239% Affordability Index currently in the Twin Cities. (The music isn’t rock, but the information rocks!)

Today, interest rates continue to hover around 5%. FIVE percent guys…Your parents, aunts and uncles signed documents agreeing to over 300% more than the rate available in this market. What an opportunity for a buyer today!

In this internet age, first time buyers can prescreen houses online with photos, virtual tours and more. Less driving and more time viewing the homes you really want to see!

Now first time buyers are in the driver’s seat when it comes to representation too. You can hire a REALTOR® to represent your interests—Usually at no cost too! Since the early 1990’s, buyer’s representation has become a wonderful opportunity for home buyers to hire an agent to represent their interests. The seller still pays a commission which is split by both agents so there is no additional cost to have your own agent working for YOU!

And in 2009, first time buyers get an unprecedented $8000 tax credit to boot! This program isn’t going to last forever but if a first time home buyer (or someone who hasn’t owned a home in the last three years) buys a home between January 1, 2009 and November 30, 2009, they will get an $8000 credit on their taxes. There are a few details and restrictions (read more here) but most first time buyers will get to take advantage of this program.

First Time Buyers! What are you waiting for?

If you are the fence about buying your first home, thinking their might be a better opportunity coming, think again! This is a great time to be a first time home buyer. People who bought homes in the early 1980’s did okay even with all the disadvantages they faced. First time home buyers today have opportunities only dreamed of when REO was on the Top 40 charts. Don’t miss out…It won’t be long before your best chance at the American Dream is just a retro memory!

.

Copyright 2009 Teri Eckholm http://www.terieckholm.com/

Homebuyers—Search for a Twin Cities Home like a PRO!

“Homebuyers LOVE the Listingbook home search!” Anyone who knows me well, knows that I don’t like wasting time in unnecessary classes or meetings. But as a REALTOR, I was intrigued by this new search tool for agents and their clients.

So, this past December, I made time to attend a class hosted by the St Paul Area Association of REALTORS on the Listingbook. I heard the spiel…great way for clients to search for homes and interact with their agent..,ya dah yah dah yah dah. I take this stuff with a grain of salt. As we were leaving the suggestion was made to sign a few of your clients up and let them be the judge. So I did just that…Listingbook system is different as “Homebuyers really LOVE the Listingbook home search!
Now all of my clients are using the Listingbook search. Some of the things my buyers like best about Listingbook include:

• Access to the same home information used by agents


• Search thousands of Twin Cities home listings


• Daily reports of all new home listings in your area


• Users see every listing, price change and photos as soon as REALTORS do


• Personalized home searches


• Faster searching with saved searches


• Visually see how many new homes meet your criteria as soon as you sign in


• Ability to save homes you like and be updated on price changes daily


• Leave notes for agent to get a quick answer on a home or set up a showing

After hearing back from my buyers I decided that maybe other potential buyers would like access to this same search. If you are searching for a home and frustrated with some of the bigger real estate search engines, this may be the perfect solution.

One family I have been working with has been searching throughout the Forest Lake school district for their dream home while waiting for their current property to sell. They love that they are now able to save and monitor their favorite homes daily and immediately see if new homes come on the market. They also keep tabs on neighboring homes for sale that are similar to their listed home. This helps to keep a competitive edge in the market.
My out-of-town clients were especially pleased with the ease of the system. They were able to find several potential homes and check out the location using Google maps and satellite images with the click of a button. When they came into town, they had identified and narrowed down potential houses to a short list and within a few hours, wrote an offer on their dream home.

While this system may not be perfect, I have gotten enough feedback from my clients to know that it is pretty terrific!

Copyright 2009 terieckholm.com