Setting Buyer Expectations in a Seller’s Market in Kansas City

Setting buyer expectations in a seller’s market in Kansas City can save you time, money and frustrations!

Seemingly overnight we have transitioned from a buyer’s market (more than six months of inventory) to a seller’s market (less than 6 months inventory) in Kansas City. Naturally there is some lag between when the news passes this info along. So right now, we have real live buyers in the field, still looking to get that deal of a lifetime, and they are coming up on homes that are going under contract in less than a week, multiple offers and oftentimes now going under contract for more than list price. If you are not ahead of this shift, and setting your buyer’s expectations about the market ahead of time, you could be setting yourself up for frustration and disappointment.

So how do you set buyer expectations in a seller’s market?

In short, data. You should have the ability to pull up market statistics in your local MLS that can show you average list to sales price ratios over a period of time. In the Heartland MLS that report is called the “Market Conditions Addendum” and does a nice job of compiling the data in a very easy format. Let’s be real, all the data in the world doesn’t mean diddly if you can’t interpret it and relay the info to your buyers in a way that they will understand.

So what if your buyers still think that they can go out and steal a property?

So if you have tried to set your buyers expectations by showing them the data that shows them that we are in a seller’s market here in Kansas City or wherever you are, then sometimes losing out on a property is the only remedy. We are the agent of our client. We can provide advice and consult to the best of our knowledge, if your client still wants to lob in an offer then as a fiduciary you have to do it. Just make sure to let them know that they could be losing out on their perfect home, while someone else comes in on top of this offer and takes it.

Ok, great Mat, we hear you, but how can I set my buyer’s expectations in this Seller’s Market?

Simple. Scripts.

List Price to Sales Price
The average list price in (____________) is (__________) but the average sales price is
(__________). That means that sellers are coming down approximately (__________
dollars). The reason I share this information is that I would prefer to turn you down now,
rather than disappoint you later, if you think you could offer $25,000 less than the list price
and actually expect to get it.
So let me ask you a very direct question. If we found you the perfect home and the seller
is only willing to come down about (_________ dollars) how would you feel about that?

If you want even more killer tips on taking advantage of this monstrous shift in the market, reach out to me here!

Are there any particular requirements for me to purchase a Foreclosure or Short Sale in Kansas City?

Are there any particular requirements for me to purchase a Foreclosure or Short Sale in Kansas City?

This is part of a longer blog thread where we are talking about distressed sales in Kansas City, and more particularly in Johnson County Kansas, and what the differences are, and which one is right for you. You can read the first post on this topic here.

As with many things in life, buying a foreclosure deal in Johnson County also comes down to “The Benjamins” – Cash money, financing and/or a combination of both.

Foreclosures

There is a big push for the foreclosures on the market to be purchased by Owner Occupants – people who are going to live there. Many of the government backed foreclosures and or big banks have a special period that only owner occupants can bid on a property. HUD call this the “exclusive” period which varies in length of time but can usually be about 14 days, and Fannie Mae calls this the “First Look Initiative”. During this time, no investors are able to submit an offer, therefore reducing the competition for these deals.

Just because you want to buy a foreclosure, doesn’t mean you can! Lending requirements for different loans have different “condition” requirements. That means, if you can only qualify for an FHA or VA type loan, the house may be in too rough of shape for it to pass the lenders appraisal process. A really good lender can explain all the different loan types available and what you will qualify for, I’m not going to get into that. Important thing to note is to tell your lender that you are considering looking at foreclosures and which loans will work for you.

Short Sales

Depending on the condition of the property the same lending requirements may apply here as well. On of the very biggest requirements in purchasing a short sale is PATIENCE. It can take 77 to 120 days for a Short Sale to close. So be prepared to make an offer, have the seller sign it and then wait for up to 3 months before you even get a response from the bank. It doesn’t mean that people are not doing their jobs, the banks are just that overloaded.

So, are there any particular requirements for me to purchase a Foreclosure or Short Sale in Kansas City? Mainly your financing, whether you are going to live there or not and your time frame are your most important factors.

Where can I find Foreclosures and Short Sales in Kansas City?

Where can I find Foreclosures and Short Sales in Kansas City?

This is one part of a longer blog thread where we are talking about distressed sales in Kansas City, and more particularly in Johnson County Kansas, and what the differences are, and which one is right for you. You can read the first post on this topic here.

The good news is that by reading this post you are already one step closer to finding the “GREAT DEALS” that foreclosures and short sales have to offer. Actually, if you just look up at the first line – that particular hyperlink will take you to a very special list – a Johnson County Foreclosure list. (Don’t tell anyone!)

I mainly wanted to write this post to warn you of the predators out there that are willing to take your money to offer you something that is pretty much free – well, you may need to provide some contact info – but never your credit card number. So if you have ever stumbled upon a “Get the Hottest Secret Foreclosure List” site and they ask you to pay for it – RUNNNNNNNN!!!!!!!!

Foreclosures – If you are really interested in finding them you can ask your Realtor – I happen to know a good one if you need one 🙂 – and have them run a search in their MLS  (the Multiple Listing Service, the database that all realtors use to market homes for sale) for the terms “REO, BANK OWNED, CORPORATE OWNED, AS IS, HUD, FANNIE MAE, and FORECLOSURE”. This should bring up quite a list of foreclosure properties, and they can set you up on an automatic email that updates you with any new properties as they come on the market.

Short Sales – This one is a little harder to search on your own, but your agent (wink wink) can help you out with that. There is a field in our particular MLS here in Kansas City where if a listing is a potential Short Sale, then they have to disclose it to the other agents. We as agents can search those types of listings or even remove those types of listings from your search.

So, Where can you find Foreclosures and Short Sales in Kansas City? Well, silly, you just did!

What’s the Difference between a Short Sale and a Foreclosure?

What’s the Difference between a Short Sale and a Foreclosure?

This is a great question and we get asked this a lot.

This is one part of a longer blog thread where we are talking about distressed sales in Kansas City, and more particularly Johnson County Kansas and what the differences are and which one is right for you. You can read the first post on this topic here.

So back to the main question.

What the heck is the difference between a short sale and a foreclosure?

There are two main differences and they all have to do with where in the foreclosure process a property or owner happens to be.

So what is a foreclosure?

A foreclosure is a listing that is being sold by a bank or other entity that has taken back a home that went into default and was unsuccessfully sold at the foreclosure auction. It is vacant and can be in many different level is disrepair. Sometimes these are called “REO’s”. According to Wikipedia, “The term REO originates from the term Other Real Estate Owned (OREO), which is used on financial statements to classify real estate property owned by financial institution but which are not directly related to its business.” Generally foreclosures are much easier to purchase and can close fairly quickly 10-20 days depending on the lender.

So what the heck is a “Short Sale”?

In short (no pun intended) a short sale is an attempt for a seller to sell a home for less than they owe(selling it “short”) on their mortgage balance in lieu of going into foreclosure.

Why would a bank want to do something like this? Why would any bank agree to sell for less than what is owed? Great question! Foreclosures are expensive and banks are in the business of lending money and not owning homes. If a seller is not able to make payments and the house can only sell for a certain amount of money, then the bank may actually save money by accepting a short sale than going all the way to foreclosure.

We will get into this in a later post, but there is nothing quick about short sales and the can take 77-140 days to close. Yikes!

If you want to find out more you can reach out to us and we will be happy to sit down with you and discuss your options. Also, if you know of someone who is behind on their payments and feels like their only option is foreclosure, then they need to talk to us right away. They have option that can greatly affect their future borrowing ability – they do not have to give up.

Till next time!

Buying Foreclosures and Short Sales in Kansas City and Johnson County – What’s the deal?

Buying Foreclosures and Short Sales in Kansas City and Johnson County KS can be a very  good opportunity for any buyer, and especially in a buyer’s market you can get a two for one value. So what’s the deal? Is there a deal? How do I find them? How do I buy them?

Do you know what you are getting into?

Make sure you know what you are buying before you get too excited about a possible deal.

Great questions! Lets look at a couple key points that I am going to discuss in detail in future blog posts.

  • What is the difference between a Foreclosure and a Short Sale?
  • Where can I find Foreclosures and Short Sales in Kansas City?
  • Are there any particular requirements for me to purchase a Foreclosure or Short Sale?
  • Are Foreclosures or Short Sales right for me?

What is the difference between a Foreclosure and a Short Sale?

There are huge differences and while both can be a great opportunity, It’s important to know what you are getting into. Especially if you have a very strict time deadline. You will find out the “Short Sale” does not mean “Quick Sale”. We will go into that in more detail in our next post.

Where can I find Foreclosures and Short Sales in Kansas City?

You have started at the right place! With Me! DO NOT GO OUT AND PAY FOR A LIST! Just subscribe to this blog or our Facebook Fan Page to get the info hot off the presses.

Are there any particular requirements for me to purchase a Foreclosure or Short Sale?

Yes, depending on if you are going to rent or live, or finance or pay cash.

Are Foreclosures or Short Sales right for me?

We will discuss things like timeline, type of financing, how handy are you? Do you have a little pile of cash to make repairs and make double your money? Are you patient and can wait for the right deal?

Stay Tuned! If you cant wait for the next post, just email me or contract us here.

Lenexa Kansas Golf Course Homes/Communities

If you are looking to live in a quality great community and wonderful neighborhood that is beautiful and highly desirable, then look no further than Lenexa Kansas Golf Course Homes/Communities. Lenexa Kansas offers fantastic homes that sit on large grass lots, complete with a wonderful golf courses that are just steps away from your new home. Living in the wholesome state of Kansas, Lenexa is the community you have been looking for!

Golf

If you are a golfer, then is not a better place to live than in Lenexa. There are 4 executive golf communities in the area and they are all perfect for everyone including; beginner to moderate golfers, and all the way to the advanced and professional golfer. The golf courses are definitely an attraction and fantastic attribute to living in a Lenexa Kansas Golf Course Homes/Community. It is perfect to live next to a golf course if you are interested in golfing, the golfing lifestyle or even an avid golfer yourself. There is an entire golfing community at Lenexa and if you just love to golf, you will love the fact that you will be around like-minded individual’s right in your neighborhood.

Lenexa, Kansas

Raising a family in a Golf Course Community in Lenexa is a wonderful idea due to the amenities that are available in Lenexa, Kansas. The homes/communities include all the features that make life grand. Close by, there will always be something to do for the kids as well as yourself. The idea is that when you buy a home in Lenexa, Kansas, you are not just buying the home, but you are buying the community as well as the neighborhood. It makes perfect financial sense to buy a home that is surrounded by lush foliage, a great golf course and other beautiful homes. All these positive perks will make resale a breeze if you ever want to put your home back on the market, but you won’t want to with the joy you will find living in a Lenexa Kansas Golf Course Homes/Communities.

Olathe Kansas Golf Course Homes

Live in Luxury and Play Golf in Style – Olathe Golf Course Homes

If you are a golf fan and just love to spend afternoon upon afternoon on the course practicing your favorite sport, alone or with company, and you feel like traveling from your home to the course is wasted time that could be better spent perfecting your swing or mastering your putt, then a golf course home is a perfect place for you to live in. One location where you can find such dream place for golf lovers is at the city of Olathe, Kansas, where golf is a way of life. Like many other traditional golf location, Johnson County Golf Course Communities enable you to enjoy your passion and live in style.

Play Golf Where You Live

The View From Your New Home

Olathe Kansas Golf Courses Homes are conveniently placed so you are just minutes from the fairway. Imagine waking up one morning and finding out you have an hour free and you wanted to spend it practicing your golf game. If you live in any other place that would be just an innocent wish, because the most typical scenario is that the golf course is located a considerable distance from your house. That free hour would have been spent just traveling to the course alone. Now imagine having that same free hour, but this time living in one of Olathe Kansas Golf Courses Communities. The picture changes radically, as now you would see the golf course out there, just by looking through your window. Spending that hour doing what you love most is a now perfectly conceivable idea.

Affordable Luxury in Olathe KS

The golf course homes that you can find at Olathe are also built and designed with the idea of delivering luxury and style. If you don’t only have in mind the possibility of playing golf whenever you wanted to, but you also care about living in a top-notch, artistically built house, then you will be able to find what you require in Olathe Kansas Golf Course Homes, where golf and luxury are coupled to form a perfect match.

One added benefit of living in this magical place for a golfer is that you will be surrounded by neighbors that share your same passion. Forming a new group of friends that are like you, think like you and, most important of all, love golf just as much as you do, will be a marvelous experience. You will have the opportunity to play with your new golf buddies on any occasion that you have the time to do so, as you all will be equally close to the spectacular golf course that are within close distance to the houses.

If you love golf and are looking to upgrade your life, take into consideration Olathe Kansas Golf Course Homes as your potential new place of residence. Contact Mat Lewczenko with Invessa Group to set up a consultation to discuss your new Olathe Kansas Golf Course Home.

Kansas City First Time Home Buyer Fears (part 3)

Can I afford the maintenance?Don't get caught without an inspection!

The third concern of new home buyers in our original survey was “Can I afford the maintenance?” If you missed the prior two posts you can read about Buying in the Right Area and What Happens if Something happens to me financially?

So congratulations! You now own your own home and have the freedom to not worry about what the landlord will say if you paint that wall purple (or Red and Blue). Along with this freedom comes the new “privilege” of home ownership – as my wife like to call it. One of the most scary or stressful things about buying your first home is, even after the inspection, what if something MAJOR breaks down, like the furnace, air conditioner or water heater?

Home Warranties

One way to help mitigate this fear is a home warranty.  The great news about this home warranty is that more times than not, the seller is willing to include it in the purchase of their home. So, if this seller has not kept up on their deferred maintenance you are protected if any of the covered appliances and systems go down for a small deductible as little as $75. We go over this benefit with you in detail during our buyer consultation here at our office.

The Actual Costs

I love my parents! Let me preface this with that, but GEEZ they can scare the BE-JEEBUS out of you when it comes to buying a new home! Everything bad that can happen to your home, will, and will cost you at minimum $5,000 for each event!I know that they are only trying to protect us, but when they don’t like a home, parent’s find it hard to tell you that they don’t like your choice. Instead of hurting your feelings, they often try and scare you with maintenance horror stories.

Here is a list of average costs for upgrades and or replacement costs of most typical projects as a home owner.

Keep in mind, these costs can vary with location, market and even between contractors. It is always advisable to get at least three quotes when planning on spending a considerable amount of money on your next renovation project. We work with many trades and contractors and always keep a list of honest professionals. Let me know if you would like some contractor referrals, I’d be happy to send them your way.

Set Up A Reserve Fund

It is also not a bad idea to set up a reserve fund for maintenance and repairs. A survey showed that a homeowner can plan on spending 1-4% of their homes value per year on maintenance. Keep in mind this is an average over time. Roofs, for instance can be $10-$15k a pop, but they last for 25-30 years if installed correctly. Now in the Midwest, in places like Olathe or Lenexa, you can plan on replacing your roof more often with hail storms, but then your home owner’s insurance usually gets involved there.

So if your home is worth $150k plan on putting $1500 aside a year on improvements and projects to keep your investment running smoothly and by keeping up on deferred maintenance you are saving tons of money in the long run. Go to your bank and have them set up a savings account and label it “Home Repairs” and put in $100 a month into it. If after 5 years you haven’t really needed to use it you may just cap it at that and be okay.

Thanks again for all those who helped put this survey together!

So what crazy DIY projects have you taken on and either surprised yourself with how well they turned out, or did something crazy happen that you can laugh about. Leave a comment below and let us know!

Thanks again for reading! As always, our business is as amazing as it is due to friends and family like you. Without your referrals we would not be here today. Thank you for trusting us with your family and friends!

KC First Time Home Buyers Fears (part 2)

First Time Home Buyer Fears part 2

Yesterday I started to address the results of a survey I posted on my Facebook Fan Page on what are some of your biggest fears when you bought your first home, or what are you concerned with most if you are thinking about buying a home right now. You can read the first post in this series here.

So to quickly recap. What were the top 3 first time home buyers fears in the Kansas City area?

  1. Buying in the right area.
  2. Can I afford it if something happens to me financially?
  3. Can I afford the maintenance?

Can I afford it if something happens to me financially?What now?

This is a really great question, and is still at the front of everyone’s mind in light of the recent economic situation. People who have seemingly rock solid jobs with the city, government, fortune 500 companies are being let go daily. So what happens then?

The first thing is having a great conversation with your lender and making sure you buy what you can afford. A good lender will not just give you a blank check, they will sit down with you, go over your monthly expenses and discuss with you what you could and should take on. The lenders who are still in business are good, there is a reason they have survived the market shift. Listen to them, but more importantly ask them questions. Here are a couple good questions you may consider asking your lender:

  • What will my total PITI (Principle, Interest, Taxes and Insurance) payment going to be?
  • What is my current debt to income ratio?
  • If I needed to sell quickly is this loan assumable?
  • Are there any prepayment penalties if I pay off my loan sooner rather than later or have to sell quickly

I will be going much further into lending, terms and the different products available in a future post.

The next step is making sure you are not paying too much for your home. As a market expert, I see hundreds of homes a month and watch the market statistics religiously. A phrase I use often with my clients is this, “If you are not a little embarrassed by your offer, you are offering too much.” This always gets a smile and you can see body language relax a little. I will always let you know if a property is grossly overpriced or if it is a Smoking HOT deal. Actually, I’m required by LAW to let you know about SMOKING HOT DEALS 🙂 That is, if we have an agency agreement.

Worst case scenario, if you lose your job and main source of income, there are options to mitigate your losses. Not over extending yourself on your mortgage on the front end can help you possibly handle it on one income until you get back in the workforce. Buying it correctly and not paying too much gives you the best opportunity to sell your home quickly and possibly not lose any money.

Stay tuned for part three of this survey Can I afford the maintenance? You can subscribe to this blog by clicking on the RSS feed icon or like our fan page and be updated when a new post hits.

Download our FREE First Time Home buyers eBook that talk about the step by step process that myself and my team will help with.

As always, thanks for reading!

P.S. If you or a friend or coworker is thinking about buying a home or selling a home in the next 30-60 days let us know! We would be thrilled to help your friends and family.

Top 3 First Time Home Buyer Worries. You are not alone.

Stressed about buying your first home?Being a first time home buyer can be pretty scary. It wasn’t that long ago that we sat at the closing table, staring at that seemingly endless pile of paperwork, thinking to ourselves, “Are we really doing this?” At that time I was not a Realtor, I was just like you – but I have never forgotten that butterfly sickness that came over me when it was time to close. So even though I now close 3-4 transactions a month, I am still very much aware of the sensitivities and stresses of the closing table.

I was curious to see if my personal initial fears were shared by many others. I harnessed to power of Facebook and asked a survey question on my Fan Page, http://www.Facebook.com/MatSellsKC and I wanted to discuss the top three first time home buyer fears an also discuss some ways to ease that fear a little bit.

When buying or selling your first home, or if you are thinking of buying a home, what is your greatest fear or concern?

So I posted this question with the option for readers to write in their own answer or vote on one already there. Over 30 friends voted(thanks) and the top 3 first time home buyer fears were:

  1. Buying in the right area.
  2. Can I afford it if something happens to me financially.
  3. Can I afford the maintenance?

Buying in the right area

Okay, I have to bite, we have all heard this term – there are only 3 things that matter in Real Estate – Location, Location, Location. 39% of my friends who took the poll agreed. So what does location really mean, and how can you make sure you are buying in the right area.

There are 5 things to consider when choosing location:

  1. Commute Time to work – Do I get a smaller house and shorter commute, or do I add 10 minutes to my drive time and double my square footage?
  2. Schools– Do the public schools in the area provide the education and extra curricular activities we are looking for, or will be looking for in the near future?
  3. Local Amenities – Are the stores close by? Do we have access to the arts/entertainment? How walkable is my neighborhood?
  4. Public TransportationDo I have access to bus lines, trains/light rail?
  5. Privacy – How close to my neighbors do I really want to be? Can they look right into our bedroom window?

Take some time to talk about or discuss these main issues to help streamline your decision making process. As a neighborhood expert, I can help guide you through some of these decisions and show you all the homes that fit your specific needs and criteria.

I will be tackling fears 2 and 3 on a future blog post. In the meantime, let me know in the comments section below, what other considerations are you thinking about when looking for the right area to buy a home in Kansas City?

Download our FREE First Time Home buyers eBook that talk about the step by step process that myself and my team will help with.

As always, thanks for reading!

If you or a friend or coworker is thinking about buying a home or selling a home in the next 30-60 days let us know! We would be thrilled to help your friends and family.