Why NOW is a Great Time to List

I can't think of a more perfect storm of circumstances for you to list your home than right now (for most people). Below is a list of conditions that make this a fantastic time to consider selling:

• Interest rates are still low but are climbing.  This creates a sense of urgency for buyers. Rate increases of no more than 1/2 of a percent are enough to price some people out of the market. 
• Prices are UP and have stabilized (to some extent). 2013 saw huge gulps of price increases. Because it moved up so quickly we had some issues with appraisals. Now prices are still on the increase but not nearly as quickly. Plus we have the benefit of at least 6 months of higher priced closings in our history. This makes it much easier for an appraiser to give you the value you need. 
• Inventory is very, very low--especially in the "first time buyer home" market. If your house is worth less than $150k (in Rutherford County), is in good shape and is priced correctly, you should sell it in days, not weeks or months. I have buyers right now that are driving around looking for homes that "look like they might be for sale soon" just so they can get a jump on the
  
  rest of the public. The good news is that the "move up home" is still somewhat available ($175k-300k). There aren't tons and tons of these like there were 2 years ago but they are out there. This is a perfect opportunity for you if you want to move up from a starter home. I would love to talk with you about this.
• Spring is upon us! This is the best time of year to list. As the weather warms, sunshine comes out and things start to green up, people look for homes. It is a refreshing time of year. They also want to be settled before school starts back up. 
• New construction is alive and well again...but they can't keep up with demand AND they are (typically) significantly higher than buying existing. Just the fact that builders are again building gives a local feeling of optimism and says our economy is in good shape again. Plus, if you live in a neighborhood where they are building currently, you get increased traffic. Someone may be drawn to look at a new home and see yours as a better bargain (especially if you fix yours up)

If you are interested in just finding out what your home may sell for, let me know. I am here to be a resource for you. A well educated public is good for everyone. Have a great day!

How's the Market?

Probably the most common question I get is, "So, how's the real estate market these days?" Many people ask because they are curious in regards to their own situation. They may be cautiously optimistic that things are looking up a bit and their real estate investment is perhaps improving. Well, I have good news. In our particular area (most of Rutherford County and southern Davidson), the market has, at the very least, stabilized. Prices have stopped plummeting, inventory is drying up and sellers are not nearly as vulnerable as they were 2 years ago. There are still pockets where the recovery hasn't really started but almost everywhere has at least leveled off.

To make matters better, some sub-markets are actually starting to recover quite nicely. For example, the traditional "first time buyer house", if in good shape and priced correctly, will sell very quickly. The best part is that "priced correctly" does not mean that it is deeply discounted. This sub-market has made somewhat of an improvement and resurgence in the last 10 months to 1 year. The best part for these sellers is that their most likely target to purchase is still somewhat on sale and interest rates are still spectacular.

So, for example, let's say you have a 1300 square foot house in Westfork in Smyrna and it is in pretty good shape. You can probably get around $100/square foot (or maybe even a little more) and sell it in 2-3 months TOPS. I've sold 4 in that neighborhood this year in less than 10 days each. The average family in that neighborhood is looking to move up to a home in the $175k-$250k range. That price range in the Smyrna/North Murfreesboro area is still fairly ripe with inventory and still somewhat on sale. So, the seller in Westfork can get a great deal on a move up home and basically "win" on the sale and the purchase side!

Obviously this is all hypothetical and your situation is always unique but the point is, most first time sellers/first time move up buyers are in a really good position right now if they look at the big picture.

Does this mean that folks in the $175k-$250k range should not sell? NO WAY! There is more inventory in this range than the lower range, for sure. The thing is, there is a lot of diverse inventory--short sales, foreclosures, "As-Is" traditional sales, estate sales, etc. A normal, no weird stipulation, great condition home in this range, price correctly, will still sell. It may not sell in 10 days, but it definitely will sell. The log jam has been broken free (a little) and the water is starting to flow.

If you are curious about your situation and just want a snapshot of the market, as it pertains to YOU, give me a call. Information is always free. If you want to sell or buy but are unsure of the steps, give me a call. If you are currently working with another Realtor and don't like the service you are getting, definitely give me a call. I know you will be pleasantly surprised. 615-668-2353  www.harmonworksharder.com

What Do I "Deserve" in Life?

I'm having a hard time writing this morning. I feel like I have griped and complained a lot here lately. I also don't think I've written enough about real estate to even call this a sometimes real estate blog. So, I am going to frame this discussion with a discussion on the real estate "crisis."

Very little in life chaps my hide more than the mentality where someone thinks they are "owed" something simply because they exist. In this blog, I am going to talk about this mentality coupled with the housing crisis. It is a worthwhile discussion and one that can be applied elsewhere.

Adam Smith published "The Wealth of Nations" in 1776. This was a groundbreaking work and discussed pretty much every aspect of an economy. One of the central themes (among many) in the commentary was the idea that, basically, if you take care of yourself, you in turn take care of the nation. If you can support yourself and your family, you are not a drain on anyone. Additionally, you must be contributing something worthwhile because you would not be able to support the family otherwise. In other words, the unintended consequence of taking care of yourself and being as productive as possible is that the entire community around you benefits. It is not a new idea but it does seem that we have departed from this standard. There are an endless array of directions we can go with this discussion but lets instead focus on housing.

Many, many things led to the collapse in the housing market. In my opinion, there were two things that were the overriding ideals that got us there. Number one is greed. Greed from politicians that tried to win votes by framing home ownership as a right and creating an environment for corporations to mask greed in the name of helping everyone attain that right. Number two was the mentality of so many Americans that they deserved the home, no matter their circumstances, no matter the cost, etc.

Let's look at number 1. Everything in our government is linked. Nothing happens in a vacuum. When the president makes a statement that he is going to work toward everyone owning a home, he sets a goal for congress. Congress reacts with a bill, the bill becomes law, someone challenges it, the judiciary confirms or denies it, the people react. Several bills have been passed toward this "goal" of home ownership for everyone since the late 70s. Several different presidents have had a hand in this "goal" as have countless senators and representatives and others. It is definitely not one single person or even party that is responsible here. See past all that label business. Politicians piled onto this "goal" because it made their constituents like them. On the surface it seems like a noble goal--"everyone owns a home because that is the American dream." The problem is that it is completely unattainable and not even a good goal to begin with. First, not everyone wants to own a home. Second, not everyone has the cash to pay for a home outright. Third, not everyone without the cash should be extended credit. Fourth, when the government meddles in this portion of private life, there is no way for them to be unbiased, no way for them to be smart and absolutely no way for them to actually "help" the situation that was fabricated to begin with.

One of the ways the government helped create the mess was to push guidelines for Fannie Mae and Freddie Mac. It may be good at this point to give a brief synopsis of these two Government Sponsored Enterprises (GSEs). Then we will see how this all happened from the top down.
What GSEs do? Basically, they buy mortgages from private lenders. If a bank or mortgage company writes a loan to someone that "conforms" to a certain set of guidelines, then Fannie or Freddie will buy that loan. They will keep some of the loans as investments but the majority are then packaged up and sold as securities to investors.
What does the government have to do with it? When these loans are sold off, it is implied that they are guaranteed by the agency and backed by the government. Both GSEs have a line of credit with the Treasury. The GSEs also do not have to hold the cash reserves that other banks do. Instead, they borrow from the treasury and repay with the revenue they get by selling the securities at a higher price than what they bought them.
What did this have to do with the crisis? This is where you have to stick with me... Government sets the goal to get more people in homes. The government holds the purse strings of the treasury that is the life support of the GSE. The government tells the GSE to get more people into homes. The GSE loosens the criteria to make a loan "conforming". For the private lenders, this creates a FIELD DAY. They can now loan to more and more people with the guarantee that the GSE is going to buy the loan. It's a no brainer for the lender. More loans+no risk (they are selling the loans as soon as they make them)=pure profit. This initial feeding frenzy starts up some other secondary market companies (Fannie and Freddie started the "secondary mortgage market--they buy the mortgage after it has been written, they don't actually lend money to the consumer) that are not GSEs but can get in on the fun. They use the same pool of investors, promise a higher return because the risk is a little greater and start encouraging lenders to make riskier loans because they will buy the loan at a premium.
Why are they riskier loans?  Lots of reasons--lower credit scores, less job history, "stated income" instead of verified income, second homes, investment property, over inflated values, no down payments, cashing out equity that is not even there yet (110% loans), interest only payments counting on the increase of the market to grow equity, the list is endless.
So what happened? They failed to recognize one key, central element in all economies--they are cyclical. Sometimes they are up, sometimes they are down. NO economy will rise indefinitely. It can't. It has to have some down times. When it came down, it came down hard. First you saw the riskiest loans start to go sour, investors panicked a little. Then you saw the GSE loans start to go south. Investors panicked a lot. This caused a major retraction of investor money. With no one to sell to, Fannie and Freddie (and all those other secondary market companies) had no way to unload the loans they promised to buy. They had a real problem. It only got worse when the low standards of lending came to roost and people defaulted on their mortgages. Interest rates adjusted up in order to cover the problem--this put even more people in bad situations. This flooded the market with properties. When you oversupply, the price has to drop. Couple this with some other bad market conditions (companies closing, people losing jobs, etc.) and you compound the issue. When the prices drop, all those people who were counting on the increase in value to supply their equity get burned. There is no equity anymore. In fact, they are all upside down. If you are upside down, your interest rate has adjusted up because you did an interest only ARM, and you lose your job--you lose your home. More people do this and the prices drop even more because there are even more distressed homes. It really was the perfect storm of bad banking practices, corporate greed, politicians buying votes by flexing control over the lenders, some natural slumps in employment and the second issue--the people buying into the "I deserve it" mentality.

I am guilty here. I catch myself frequently justifying purchases because I deserve something. I work hard and thus I deserve that new ____________ or whatever. We have a lot of help in programming this mentality into ourselves. And honestly, its not that hard to believe it.

We live in such a wealthy nation it is easy to see the success of others and to hear the stories of people starting from nothing and going to millionaires (or more). The sad part is, we only hear those stories AFTER they have made it. We don't get to see, really see all the work that goes into getting them there. When we see that success we get inspired to be millionaires also. The problem is, we don't (usually) get inspired to make the sacrifices and work toward that goal. Instead we frequently adopt the "if ___________ is that rich or has that _______, I should too." Jealousy creeps in. Politicians love to use this in their quest to keep power. If we throw the plebes a bone, they will love us for it. Thus, we have the situation I outlined above. And we, as a society, play right into their hands. A lot of the people that were involved in the housing bubble knew that what they were doing didn't make sense. These were not stupid people. They got caught up in the moment. When they laid down their heads though, they knew that it was not going to last and it was not a good idea. It doesn't make any sense to borrow more than what a house is worth using that house as collateral. It doesn't make any sense to pay interest only on a tremendous debt in order to be able to afford MORE DEBT. But we, as a society, did it. Why? Because we could. It allowed us to be that much closer to "the haves". We deserve it. We work hard and the government says everyone should own a home. The banks agree and they are nice enough to give us our dream even though we are uneasy about the payment and the possibility of future payments being higher. Think about it.

If we had been a society that inherently delays pleasure and rejects jealousy and truly understands that we deserve only what we work for, we would have NEVER been in this situation. We would have rejected the notion that everyone deserves a home and replaced it with "everyone that deserves a home has worked to earn it." Think about that.

I work and save, work and save, work and save. I pay all my debts on time because I don't take out debts that I cannot repay. I live within my means. I work hard at my job and earn a salary commiserate with what I contribute to the company. I do what is best for my family and I buy within my means. I earn a home because I planned to get it, worked toward it and secured the way toward it. I didn't wake up one morning and decide it was my right even though I spend everything I have and never work toward a plan and always live outside my means.

Here is the bottom line and how it all relates back. When you start to think that it is unfair that so and so has whatever, look in the mirror and ask yourself, "what did I do to earn that?" Sometimes you do experience setbacks that may not even be your fault. Sometimes you make a mistake due to inexperience or trusting the wrong person. That happens. Sometimes people are very fortunate and maybe even dishonest and get stuff they don't earn. That happens too. But, at the end of the day, if we are truly honest with ourselves, sloppy management, poor planning, laziness, ignorance, lack of research, naivity, jealousy and greed (all of which we can control for ourselves) are going to be the root of your money and housing problems 99% of the time. I know they have been the cause of all of my money problems in life.

The answer to my initial question, "What do I deserve in life?" is pretty easy to figure out. What I have worked for, no more, no less. If you feel that you deserve more compensation out of your job, quit, learn a more valuable skill or demand a raise. If you feel that you deserve more for your money, negotiate sales or clip coupons or whatever. DO something about it instead of relying on the government to TELL you what you deserve.


On a COMPLETELY different note, the college ministry that I work with has started a new prayer ministry. It is pretty cool. Basically it works like this, if you need prayers or know someone that does, you text your request to 61JESUS4U2 (615-378-7482). You can be completely anonymous or give all the details you want. We will not keep your number, solicit money, sell your info or anything else. We will not even contact you back unless you want us to. All we will do is pray for your request. So far we have about 20 signed up to pray. I suspect in the next few weeks we will have over 100 on the chain praying.

Special Edition! New Year's Resolution

It's been a while since I have written an overtly Real Estate related blog. This is only sort of one.

I have been doing a lot of thinking lately about my job, my work, my source of income. This is the time of year to evaluate performance over the last year and to plan and strategize for next year. I've done some of that, identifying markets I want to be in, planning some new marketing strategies, etc. One thing has been bugging me though and I finally made a little headway (so to speak) today in pinpointing it. The phrase, "work as ministry" has been in my head. After several days of this thought, I've decided to work it out by writing it down. I also decided to share that writing with you in hopes that you can implement the same kind of strategy.

Work as Ministry

For most of my more mature Christian life I have heard various people espouse the virtues of treating your work as ministry. Be a witness wherever you go. Treat people as you want to be treated. What would Jesus do. All those phrases that we all know and have used to the point that they are almost cliche. The problem is that they are not very specific and don't give a guy like me some concrete things to DO to accomplish those noble goals. What I am writing now is my gameplan on how to put those cliches into practice as a Realtor. I hope that you will read these and be inspired to do the same wherever you work. I believe God expects it of us and I know that our coworkers/clients/customers/employees/employers (Christian and non-Christian) need it from us. So here goes:

How can I make my job as a Realtor into ministry?

• Implement the golden rule--I know it is one of the cliches but it is a good one. I truly need to treat others as I would want to be treated. Even more, I need to treat people as God would want me to treat them. This means I just naturally go the extra mile. I provide more than they expect, all the time, without them asking. EVEN moreso, I need to do it with a really joyous, thankful, genuine disposition. Do it because I love them as people.
• Understand that I am helping them with something far more important and noble than just buying some product. A house is (for the VAST majority of people) the largest single investment they will ever make. A house is something they dream about, somewhere to raise their family, somewhere to build memories and somewhere to turn into HOME--a concept almost everyone longs for. It can be a complicated task and I am honored when someone trusts me to help.
• Delight in the small points of this process. People make decisions about their home based on ALL KINDS of reasons. For some it is simply the schools, the square footage, the condition and the overall layout of the house. Others go by "the feeling" the home gives. I need to be open to all of those deciding factors. I need to tune into those factors. I need to fight the urge to become frustrated when someone takes a long time to decide and seems to be too picky. I need to delight in the meticulousness some people exercise--after all, this is where they will call home.
• I need to be 100% honest and up front with people. I am an honest person but even so, I will sometimes sugar coat things. No one benefits from that in the long run. This policy may cost me some listings but in the long run, it will help. More Realtors need to do this. You help no one if you have a listing for 6 months with no showings. If the house smells, tell them. If the house needs work, tell them. If their price is WAY out of line, tell them. Set the expectations. I know there are some reasons for listing an overpriced property but don't give false hope that it will actually sell
• Humility, honor, integrity and thankfulness--These are the words that should govern my actions.
• I can only do so much and God does the rest--this gives humility.
• Honor is a 2 way street--I am honored that my clients trust me and I honor them, my family and my God by treating people well
• Integrity--goes without saying
• Thankfulness--again, thankful for my clients' trust and thankful for God's blessings. Also thankful that I live in a place where I can help people in this fashion.
• NEVER give less than my full effort. Again, this is someone's home that I am being trusted with. Less than 100% is not acceptable--even if I am tired or grouchy or whatever. Remember that this is a SERVICE job. It is my opportunity to serve my fellow man. This is a super important point of emphasis for me.
• Focus on the family--including my own. I cannot do this without my family and I need to keep telling myself that, no matter how busy I am, I owe it to Cindy, Jonas and Maggie to put them first. When I do this and still get the "job" done with efficiency, I set a great example for my clients.
• Value the relationship that is being forged. When people step into my path and we work on their largest asset, there is a natural relationship planted. There are no accidents and I HAVE to put value on the relationship that results from helping with a business transaction. It is an emotional process to buy and sell the home. Don't be closed off and just get to know people on a superficial level. If they are open to it, take the opportunity to actually build a relationship--even if the person is a little weird.
• Finally, to really see this as ministry, I need to keep God in it. So many people are afraid to talk about God because it might offend someone. I don't need to preach but I don't see any reason why it can't be woven into the conversation. If that conversation is rejected, then leave it alone but I should always try.

These bullet points are my outline for treating my "job" as ministry. This is real, rubber hits the road kind of stuff. I would love to see your thoughts on this. I would also challenge my brothers and sisters out there to think about this goal and set specific objectives on how you might do the same. Let me know if I can be of service to you.

Time Flies when You're Selling Homes!

I can't believe it is already 2/3 through May! I have a closing this Thursday. Tamara, bless her heart, will FINALLY get her home. It has been a long, l o n g ,  l  o  n  g  process. God willing, it will all be over in about 48 hours. I am so happy for her. I think we have developed a lasting friendship through this and I hope she is willing to stay in touch. I have a closing next Thursday as well (assuming we can get through the financing--RD is dried up). This one is particularly exciting to me as it is a young man that I met when I was his wrestling coach. He is such a good guy and has worked his butt off to get where he is so quickly. I know that Jeremy and Amanda will be real success stories as long as they keep doing what they are doing!

Aside from those, the flood has really been at the forefront of everyone's mind here in Middle TN. You all know that there has been tremendous financial loss. Weichert has "adopted" a fellow in River Plantation and is trying to help him get his life back together. If you get a chance, check out the video that Mickie, one of the owners, posted on YouTube about Carl and his situation (video is here). We were thankfully, personally not affected too much. We did drive through some serious water and Cindy's van is making a noise (I know, not smart, but we had to get home). Brandon's granny suffered a pretty devastating loss and a few others from church had some severe damage. Dad and I got to do a little work in driveways because of it though.

As far as listings go, I have 4 up on the market now. I just listed Jeremy and Amy today and hope it will go quickly for them. Thankfully people are starting to look again. I really want to get the Gastineaus sold as they have been on the market since November. It has just been tough in their neck of the woods. The really puzzling thing is that their home is FREAKING NICE and is priced so well. I just gotta get more people in the door! The Chunns are also waiting. They have such a cute little home in a great neighborhood and are priced nicely too. I think for them, the tax credit running out, coupled with the flood diverting attention away have slowed things down. I see it picking back up for them in the next couple weeks though. Then there's the big house. We have had some really positive activity there and hope we can break some stuff loose on it real soon. I know that Charles and Lori are ready to get going. Cindy and I will have our home up in the next two weeks or so and are excited about that. We have worked hard at getting the home ready. Hopefully it will go quickly also!