The Wall Street journal wrote an article about the impact of the poor quality materials and shortages of skilled workers who were constructing homes during the housing boom of the late 1990’s and early 2000’s. As a result a there has been a surge in construction defects, some housing experts say. Because so many homes were constructed so quickly many municipalities and county building departments also fell behind inspecting and certifying new homes. In some cases when homes were inspected, it was a quick walk through as opposed to a thorough inspection, which left many defects undetected.
I purchased a newly constructed townhome in Decatur, Georgia in 2001 and had this experience. The dryer vent was not installed correctly and I later found out that the lint was being vented into my furnace. My home was inspected by the county prior to me moving in but since the inspectors were inundated with new homes to inspect, it led to them doing quick walk throughs instead of thorough inspections of all aspects of the property.
Criterium Engineers, a national building-inspection firm, says that 17 percent of homes built in 2006 had at least two significant defects, up from 15 percent in 2003.
Construction defect insurance claims have declined in the last couple of years, “but the ones that are being filed are pretty severe in terms of the total damage alleged,” says Paul Amirata, vice president of claims for France-based Axa Group, one of the world’s largest business insurers.
Buyers of homes built during the boom should consider getting a thorough inspection by a building inspection engineer or licensed contractor with expertise in that specific trade and review purchase and warranty contracts carefully with an attorney, experts advise. If you are trying to resolve any defects with Cincinnati real estate I would be happy to refer you to reputable contractors and inspectors.
CABR released the following press release about May Home Sales in Cincinnati. Home sales locally continued their upward climb last month, as Realtors sold 1,658 units. That’s a 19.8% improvement over April’s sales activity. The average sale price in May was $155,896, a 12.9% improvement over April.
Statewide, the Cincinnati region posted the second highest average selling price last month. Columbus was highest at $168,576. Dayton was at $125,236; Cleveland/Akron $118,016, and Toledo
$104,146.
In comparing month-over-month, May sales were down 13.7% from a year ago. For the first five months, sales were off 14.6% from the same period one year ago. Nationwide, seasonally-adjusted home sales climbed 2.4% in May over April.
“The public continues to buy homes despite a soft economy” said Paul Jacob, president of the Cincinnati Area Board of Realtors. “That’s because continued home buying is a testament to asset building.” Mortgage rates near 5.7% remain favorable, Jacob added. “It’s not as low as two months ago at
5.2%, but it’s better than a year ago when mortgage rates were at 6.7%.”
Inventory of homes available for sales is another plus for buyers. Current inventory is 8.48 months of homes for sale. Last month it was 9.96 months. A year ago it was 8.35 months. A lower number means greater demand for current inventory. A balanced market for buyers and sellers is around six months, and that’s why a buyers’ market still exists.
The current $8,000 tax credit for persons who buy a home that haven’t owned a home in the past three years is another part of a buyer’s current-day advantage. That program expires Nov. 30. Jacob said home buying should continue to improve, as buyers realize that sitting on the fence too long simply delays asset wealth building. Bargains exist today, and smart buyers are doing just that buying smartly.
Cincinnati homeowners and homeowners around the U.S. need to be aware of the following information if they are looking to refinance and are having difficulty getting approved. There are options for refinance and loan modifications mandated by the federal government.
The Making Home Affordable Program was created to assist homeowners whose home values have declined to the point where they may no longer have equity in their homes. So the homeowners have not be able to refinance their homes and take advantage of lower interest rates. In addition, many of these homeowners are also locked in to 3,5 or 7 year adjustable mortgage rates which will soon reset at higher rates. To try to assist these homeowners the federal government started the Making Home Affordable Program. The purpose of the program is to stop the cycle of foreclosures and short sales and to provide homeowners who are in this position to have options to save their home and financial stability. This program has eligibility requirements that must be met. For more information please visit the Making Home Affordable Website. This site helps borrowers learn basic facts about mortgages, homeownership, and resources available, with more than 17.7 million page views in less than two months.
Fourteen servicers, including the five largest, have now signed contracts and begun modifications under MHA. Between loans covered by these servicers and loans owned or securitized by Fannie Mae or Freddie Mac, more than 75 percent of all loans in the country are now covered by the program. The 14 participating servicers have extended offers on over 55,000 trial modifications and mailed out over 300,000 letters with information about trial modifications to borrowers.
Urban Cincy reported this morning that Mayor Mallory has selected the development company that will finance, plan, design,construct, operate and maintain Cincinnati’s Modern Streetcar System. The location of the streetcar would be on the northern end of the Downtown/Over the Rhine circulator which would head uptown from there. This is great news for Cincinnati Real Estate. The addition of a streetcar in Downtown Cincinnati is great news for Cincinnati Real Estate. The continual development and success of downtown will continue to attract the creative class, which could eventually lead to new businesses moving their headquarters to Cincinnati.
RIS Media published a report to teach consumers about how to maintain and improve one’s credit score. Everyone has become more concerned about their credit scores these days, especially when a better score can result in lower credit interest rates and payments saving thousands of dollars from interest. With this in mind, many consumers are paying more attention to their credit and, unfortunately, in the process of trying to make it better, they are harming their credit score.
A consumer credit score is made up of five key components:
35% : Payment History - Types of accounts (credit card, mortgage, etc.), accounts paid as agreed, number of past due accounts, etc.
30% : Amounts Owed - Balances of current loans, debt-to-credit ratio, proportion of installments still owed, etc.
15% : Length of Credit History - Time since accounts opened, last activity, etc.
10% New Credit – Recent inquiries, new accounts, etc.
10% Types of Credit Used - Mortgages, credit, retail, etc.
Here are a couple of pointers that I have been instructed by loan officers that I work with include the following recommendations to buyers of
Cincinnati Real Estate to try to optimize your credit score. The first thing is that you should be careful about is using most of your available credit each month. I was told about a situation where the person has a $5,000 credit limit and uses about $4000 of that each month. Even though they pay the card off in full monthly, the individual’s credit score is negatively affected. The credit bureaus advise spreading your purchases over multiple cards or raising your limit on the card you use most often to lower the debt to credit ratio on it.
Another recommendation is to keep cards open even if you do not use them often. You can buy a small item once per month on the card to keep it active. Also it is advisable not to cancel older cards because they help to maintain the length of your credit history. Keeping older cards active boosts your credit score.
Finally, since too many credit inquiries can can lower your credit score it is important to note that inquiries with 90 days of one another for the same purpose do not lower one’s score. So if you have multiple mortgage brokers or car dealerships requesting your credit report, feel free to shop around without worrying that your credit score will be negatively affected.
Greg Breitfelder, Comey & Shepherd’s licensed property auctioneer, provided me with these helpful pointers to guide buyers leading up to and at a property auction.
Registration ‐ Bidders typically need to register before the auction, this is a simple form to fill out so that the bidder recognizes and understands the terms and conditions of the auction. We have a bidder’s registration form that can be viewed on the Comey Website under our auction heading.
Sold “As Is – Where Is” – This is common, as it says, the property is sold to the highest bidder without any conditional requirements. At this point, the prospective buyer should have had an inspection previous to the auction. It is by far, a great advantage to your bidder and to you to have buyers get an inspection completed, doing this will either get buyers more excited or less excited based on the inspection findings.
Buyers Premium – Typically when an auction is being conducted, the number that the auctioneer is chanting is not always the bid price, buyers should be aware that if there is a “buyer’s premium” it will be added to the end of the winning bid. Many are confused as to why we have a buyer’s premium –this is the commission and it is split many ways. The seller does not pay a commission in an auction sale.
Down Payment ‐ Bidders typically need to have a down payment the day of the auction, it may be a flat fee or a set percentage of the final bid amount, be sure that the bidder understands that he or she should be able to produce a down payment the day of the auction. Too many times a bidder shows up with a personal check or a business check, these methods of payment are typically not allowed.
How much should I bid? It is always a good idea to decide how much you want to bid and stick to that number, it can be easy to get caught up in the emotion and bid too much. Your Cincinnati real estate agent can provide you with comparable sales in the are so you understand what the property values are in the area before you bid.
Your Commission ‐ Agents typically need to register their client, many times he or she would have to actually show the property to get credit for the sale. Make sure that you understand what hoops he or she has to go thru before getting commission for the sale. Let the Auctioneer tell you.
Not All Auctions Sell to the Highest bidder.
There seems to be confusion all the time with this. The only type of a sure sale is at an Absolute Auction, if the bidding starts, it will end with a final and successful bidder.
Reserve Auctions – Sell if they are confirmed by the owner of the house.
Minimum Bid ‐ auctions only sell if the minimum bid has been bid.
Hope this helps and feel free to contact me at any time regarding any auction questions you may have!
Here is my letter to Richard Dyer GM of WLWT Channel 5 Cincinnati. The hypocrisy of this news station to advise people to not use Realtors is irresponsible. Please voice your opinions on this to him.
Mr. Dyer:
I just saw a teaser for a story that you plan to run on Monday, June 8 about how people no longer need real estate agents to sell their home. As a Cincinnati realtor and real estate blogger, I am disappointed that you would encourage the public to stop using realtors for many reasons. There are many situations when people engage in business and hire professionals to mitigate their personal and financial risk. We rely on lawyers, and even dentists to perform their jobs and keep us safe. It is entirely conceivable that anyone could pull a tooth, or even represent themselves in court without the counsel of these professionals. It is my belief that you would see it as egregiously irresponsible to run a story on how to represent yourself in court using resources you can find online, or how to excise an abscessed tooth using tools you in your garage.
In this economy, when Channel 5 you are promoting job fairs and unemployment reports I feel it is disturbing that you are encouraging people to not patronize the real estate professionals that deliver documented value to their customers. There is genuine peril in real estate transactions that could lead people to financial loss, losing their homes, and risking exposure to lawsuits. It is disingenuous to tell people to put themselves in a risky situation without professional assistance when the research proves that they will make more money and have less risk when they use a licensed professional real estate agent even with commissions. For once, the news should present the facts backed up by research instead of what shortcuts people can take that they perceive will save them money, when in reality it does the opposite.
Essentially your station is encouraging people to buy or sell the largest investment that they can make in their lives without getting professional representation. I think you should present the facts to the public, and the facts are that houses sold by realtors are on the market for shorter periods of time and net higher sale prices than homes that are sold by owner even with commissions. There is a lot more to selling a home than just posting photos on the web and getting a check in the mail. The process of buying and selling a home involves legally required disclosures, strategic market placement, contracts, negotiations, inspections, and in today’s market a lot of navigating the red tape of the financial system which many lay people do not understand. I hope that you will reconsider how you present the story on Monday. If you need research to support my claim please email me as I would be happy to email you articles or direct you to the sources of much of the real estate research: The Cincinnati Board of Realtors, The National Association of Realtors have a lot of data to support these facts.
Regards,
Alison Moss
Cincinnati sits atop the list of the most vacant properties in a city. WCPO reported that there are about $4 million vacant properties nationwide. Cincinnati’s Over-the Rhine Neighborhood has the highest vacancy rate in the Tri-State area. Vacant homes can have a substantial impact on home values depending on their status. Foreclosures in particular can bring down neighborhood values simply becuase they will often for less money at auction.
My professional opinion about this situation as a Cincinnati Realtor is that property owners in areas where vacancy rates are elevated, can face delated property values. Before purchasing a property you should always be aware of the sales trend and vacancy rates in that specific area prior to signing any contracts.
WCPO news reported the results from a Men’s Health Magazine poll that named Cincinnati the third quietest city in the nation. They based their results on a whether cities have noise ordinances, how much traffic they have and how many residents say they get less than seven hours of sleep per night. Just another reason why Cincinnati is a great place to own real estate.
Since it is the start of the holiday weekend that kicks off the Summer 2009, I thought I would stray from my usual Cincinnati Real Estate informative postings and let people know where to have fun in Cincinnati this weekend! Please check back next week to hear more specific information about the first time home buyer tax credit, my new rental property portal, the Realtor credit union and much more. Happy Memorial Day!
TASTE OF CINCINNATI AND TASTE THE HYPE – MAY 23 – 25
The annual P&G Taste of Cincinnati USA is this weekend on Fifth Street downtown. Now the nation’s longest running culinary arts festival, the Taste features over 40 fine restaurants serving delectable menu items. Also, enjoy a music festival with continuous live entertainment from local and national recording artists. Admission is free and every entrée is $5 or less. Hours are Saturday, May 23 and Sunday, May 24 from noon to midnight and Monday, May 25 from noon to 9:00 p.m. For more information Click here
On Saturday, May 23 from 7:00 to 11:00 p.m. young professionals can receive VIP treatment at Taste the Hype which includes free parking at Fountain Square Garage, beer and wine, plus beer and wine sampling, food fetched by volunteers, souvenir refillable mug and a prime seat to catch the music of the Rusty Griswolds on Saturday night. This affair is only $25 per person or $40 for two ($20 per person). Click here to reserve your tickets now.
