Housing markets close to Boston received the biggest boost in home prices from the federal tax credits and low mortgage rates that buyers enjoyed in the first half of 2010.

A report released on Tuesday by The Warren Group of county-by-county median home prices for the first half of the year shows that Boston Suburbs generally saw the biggest increase in median prices from 2009.

With the exception of the tiny Dukes County market, which largely consists of second homes on Martha’s Vineyard, Norfolk County was the strongest market in Southeastern Massachusetts.

Norfolk County’s median price for a single-family home in the first six months of 2010 rose by 9.3 percent to $375,000. Meanwhile, the median price for single-family homes during the six-month period rose by 2.3 percent to $270,000 in Plymouth County and by 5.7 percent to $322,250 in Barnstable County, compared with the first half of 2009. Bristol County’s median price  fell by 2.1 percent, to $235,000.

Suffolk County, which is mainly the city of Boston, enjoyed the second-best median price increase for single-family homes of any county: a 12.3 percent rise to $330,000. That contrasts to a statewide median price increase of 7 percent during the first half of 2010.

In general, strong single-family home sales continued through June, with home sales rising by more than 28 percent compared with June 2009. Home sales rose by a similar amount over the first six months of 2010.

Much of the sales activity could be attributed to the first-time home buyer tax credit of $8,000. Buyers needed to have a signed purchase-and-sale agreement by the end of April to take advantage of the federal credit. Most of those home sales closed by the end of June, and were reflected in June sales figures.

Early signals show that the market has softened somewhat since the April deadline, with sales agreements declining in May and June compared with the same months last year.

However, real estate agents said home values have stabilized. While they don’t expect the trend of 7 percent, year-over-year increases seen in the first half of 2010 to continue, agents said they don’t expect much of a decline, either.

That’s partly because interest rates are still near historic lows not seen in more than a generation: Many lenders are offering 30-year fixed mortgages with interest rates between 4.5 percent and 5 percent.

Right now the press is speaking to the slowdown in the economy that started in June. Greenspan mentions it in his video in one of my recent posts, Greenspan Talks The Economy And The Markets. Of course we will have to wait and see what shapes up for the second half of 2010 but the markets, both Stocks and Real Estate slow down every summer. The second half of 2010 will have to do its own talking.

Written By RE/MAX Accredited Buyers Agent Jeff Persons – 617.512.3443

Related Articles by Jeff:

Boston Real Estate 2nd Most Improved U.S. Housing Market 2010

Recession Proof Boston Real Estate and the Megaphone Formation

The Boston Real Estate Market Has NOT Experienced a Recession

How Boston Real Estate Will Be Helped by Rising Interest Rates

5 Smartest Protections For Buying Boston Area Homes

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

What do you think? Your comments will be appreciated

Boston and Boston Suburbs Enjoy Biggest Surge In 2010 Home Prices

I love LINK Network graphs because they plainly display how Boston Homes have been a recession-proof investment this decade. Let me add the caveat that although Boston Real Estate has been an exceptional investment for the last ten years, a prolonged downturn will make everything cheaper sooner or later. I’m bullish to a fault sometimes and I have to remind myself to be rigorous. All we have is the past to use as a pointer to what might go on. I remember 1986 to 1996, a decade where no one I knew made any price appreciation on their homes. Not one penny. Then comes 1996 to 2006 and that decade everyone got a double, triple, and even a few quadruples to the fair market value of their properties. No one that I know of predicted either decade. It is a market after all, win or lose.

Boston Homes Citywide

Citywide Boston Homes Ten Year Price Index (Appreciation Rate)

Back Bay Ten Year Price Index (Appreciation Rate)

Beacon Hill Ten Year Price Index (Appreciation Rate)

South End Ten Year Price Index(Appreciation Rate)

This isn’t much more than a graphic history lesson. It tells us that these neighborhoods have done really well for the last ten years. Will the trend continue or fall off? I absolutely do not know. I have some opinions but that’s what they are opinions and conjecture.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

The Best Time to Buy Boston Real Estate in 2010

A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much

Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Buying Boston Real Estate, The Pre-Approval Letter Must Come First

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

What do you think? Your comments will be appreciated

Boston Homes Price Appreciation For 2000-2010

What You Can Lose

Working with FSBOs ( For Sale By Owner) may be OK in Phoenix or Arkansas or Atlanta but here in Boston you are really asking for trouble if you work with a FSBO.

Of course we can understand why someone would want to sell their own home. Sometimes it means the seller can walk out of the closing without owing any money. No seller wants to write a check to the bank at a closing. Although this is great for the seller, for us its buyer beware on steroids. There are things that can go wrong without a Sellers Agent and a Buyers Agent involved.

The first thing that comes to mind is that often a seller will go FSBO, not just to save money but also to HIDE shortcomings with the property that if he told the listing agent, the listing agent would have to tell everyone and the seller knows this. Full disclosure is practiced by all real estate agents who want to keep their license. The Sellers Agent  has his license at risk. So right out of the gate in a cooperative fashion you are helping the seller save money but you are sacrificing one of your protections. Even if the seller tries to hide the defect, most Sellers Agents will figure it out and that’s just embarrassing! So if he changes his mind and wants a Sellers Agent that defect he was hoping you wouldn’t see is disclosed right up front.

The second point is that if the seller is too stingy to pay the 5 percent for a Sellers Agent, that leaves you unrepresented because 2.5 percent of that is supposed to pay for your Buyers Agent. So now you are thinking about how to eliminate the Buyers Agent and there is exponentially greater potential for serious problems.

For Sale By Owner is more feasible but NEVER advisable in other locations around the country because the properties themselves are simpler, newer and the money they can cost you in your first 5 years of ownership is less. Four out of five available properties in Boston are condos. These condos were carved out of 1880s brownstones and no two are alike. So the buildings are 130 to 160 years old in Back Bay, Beacon Hill, South End, The Fenway as well as Brookline MA. A lot can go wrong with these buildings, which creates more risk here in Boston. There are so many places to hide defects that no one will catch them all.

Years Ago, I bought a condo on Commonwealth Ave. Six months later I got a  bill for $8,000  for a new roof in my mail box. Next they wanted $16,000 for new elevators, this all in my first 2 years of owning the home. I was in a different business then and I didn’t know anything about real estate. I worked directly with the listing agent and really shot myself in the foot with that place. If I had had a Buyers Agent, he would have investigated for me. I was so naive, not knowing how much money I could lose.

Your home inspector will find out what to him are obvious defects and that’s a great help. But even he can’t see through walls like Superman. Also you will want a good real estate lawyer experienced in inner city condos. She will read the 3 inch stack of condominium documents that have accumulated on the condo since as far back as 1958. Its great and absolutely necessary to have these professionals but they are not enough. Without representation by a Buyers Agent, no one is watching your back.

The FSBO Saves Money, You Get Screwed!

If you deal with a FSBO, you are expected to take what the seller tells you as bible. Now how rigorous is that supposed to be? And don’t let the FSBO seller tell you they will charge you less because they don’t have to pay the 5% because that’s just not true. Any money he saves will go directly into his pocket while he blows sunshine you know where. With a little fuzzy math he will try to convince you of the savings. The reality is you will pay the same money as everyone else, except everyone else will have representation!

Another Example

Once I agreed to show a FSBO because my buyer wanted to see it and after a phone call to the FSBO, found out that the seller would pay me the 2.5 percent fee for my Buyers Agency. The unit looked great and the numbers worked in terms of fair market value. I was a little curious about the real estate across the street as it seemed to have fallen into disuse. After a little digging I found out that they were talking about a new 6 story building there.

For My Buyer It Would Have Meant Two or Three years of Construction Going on Right Across The Street

Legally the FSBO didn’t have to tell us that because the plans were not final yet and he didn’t tell us. We had to find out for ourselves. I saved my buyer from living at a construction site for years to come. What would have happened if my buyer hadn’t had me there? If the FSBO wised up and got a Sellers Agent, the Sellers Agent would be telling everyone about the proposed construction as they walked through the door and expressed any interest. The FSBO knew he would, that’s one more reason to not hire the Sellers Agent.

My advice is if you see a FSBO, cross to the other side of the street and walk the other way. He is out to save money at your expense and your anguish!  There should be a Buyers Agent and a Sellers Agent involved in every real estate transaction.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons

More articles by Jeff:

The Best Time to Buy Boston Real Estate in 2010

Back Bay Boston Condos Prices Double From 2000-2010

Boston Condos, Would You Let Your Daughter Live There?

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

How To Establish Fair Market Value For Boston Suburb Homes

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

What do you think? Your comments will be appreciated

Buying Boston Condos, Stay Away From FSBOs

Sanguine

Here comes my favorite money guy Alan Greenspan. For 18 years as Fed Chairman, Greenspan guided the economy in our country as well as guiding market participants to realize the emergence of the “World Economy”.  I was trading stocks for many of those years and I watched as he made the right moves with the prime rate, deftly balancing growth against inflation. His intuition about the GDP, growth and interest rates was so keen that he could keep us in that sweet spot of inflation free growth. He was so good at playing the market like a musical instrument he earned the nickname Maestro.

I like what he says in this interview, not just because he agrees with me but he has a track record that is impeccable. Alan Greenspan is one of my heroes. He is also very modest, unassuming, brilliant man as well as a great American. He discusses many of the subjects that I discuss in this blog like “What is the Stock Market Telling Us About the Real Estate Market?” as well as many other articles about Boston real estate.

On CNBC the reporters run out of synonyms for an optimistic outlook as you can imagine. So I get to use the word sanguine (cheerfully optimistic, hopeful, or confident: a sanguine disposition; sanguine expectations.) As in Alan Greenspan is definitely running his usual balance between being sanguine about the recovery and cautiously warning of excesses in the markets that could stall the recovery. Greenspan is humble enough to admit that he does not fully understand why we just went through the worst global financial crisis in history. The video is kind of long but if you listen carefully… well, lets just say I am more sanguine about the recovery myself after listening. Hey, I got to use sanguine thrice! I hope this doesn’t sound pretentious, I just love playing with words. And I self publish so I can say what I want. I love it!

Related Articles by RE/MAX Destiny Accredited Buyers Agent Jeff Persons:

The Boston Real Estate Market Has NOT Experienced a Recession

How Boston Real Estate Will Be Helped by Rising Interest Rates

Recession Proof Boston Real Estate and the Megaphone Formation

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

It Doesn’t Surprise Me That Boston Real Estate Prices Are Holding firm

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

Greenspan Talks The Economy And The Markets

File This News Under Encouraging

I have been saying on this blog that we are at the end on a consumer led recession.
Here are 45 business people who agree with me enough to start a retail location in Bostons Back Bay.

On Thursday, July 8, Mayor Menino and BRA Director John Palmieri welcomed 45 new retail businesses to the Back Bay. Thirty of the new retailers have opened since last July when the Mayor hosted a walking tour of Back Bay retail opportunities. The other 15 retailers have signed leases or are currently under construction and will open soon. All together, it is estimated that the businesses have created more than 500 jobs. The majority of the companies are located on Newbury Street, with others located on Boylston Street, Dartmouth Street and Massachusetts Avenue.

Retailers that have opened since July of 2009

Boloco 1080 BoylstonBack
Back Social Club 867 Boylston St.
Iris Gallery 129 Newbury Street
Jonathan Adler 129 Newbury Street
Hotel Chocolat 141A Newbury Street
Annabel Jones 144 Newbury Street
Ben Sherman 154 Newbury Street
S. Kuhlman 160 Newbury Street
Joe’s American Bar & Grill 181 Newbury Street
Ted Baker 201 Newbury Street
L’Atitude Gallery 211 Newbury Street
Warlox Wireless 217 Newbury Street
Piattini Café 226 Newbury Street
Mumbia Chopstix 254 Newbury Street
Pazzo Restaurant 269 Newbury Street
Sugar Heaven 669 Boylston Street
Cotelac 168 Newbury Street
Raven Bookstore 263 Newbury Street
Second Time Around 324 Newbury Street
All Saints 122 Newbury Street
Brooklyn Industries 337 Newbury Street
b. good 137 Mass Ave
Basiques 172 Newbury Street
Sweet 225 Newbury Street
Pavement Café 1096 Boylston Street
Rescue 244 Newbury Street
G2O 276-278 Newbury Street
KitchenWares 215 Newbury Street
Victoria Munroe Fine Arts 161 Newbury Street
Lisa’s Nails 170 Newbury Street
Vizi 230 Newbury Street

Retailers who have signed a lease or are under construction since July 2009

Back Back Social Club 867 Boylston St.
Converse 348 Newbury St
Diane Von Furstenberg 73 Newbury St.
Forever 21 341 Newbury Street
Ibex 303 Newbury
Levi’s 131 Newbury Street
Max Brenner 745 Boylston St.
Met Bar & Grill 277 Darmouth Street
Towne Stove & Spirits 900 Boylston Street
Vera Wang Bridal 253 Newbury St.
Jack Wills 179 Newbury Street
The Fish and Bone 217 Newbury
Deux Avenue 61 Mass Ave
Boloco 569 Boylston Street
Audreys Supplies & Services 217 Newbury Street

Courtesy of Boston Redevelopment Authority.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons

Additional articles by Jeff:
Boston Real Estate 2nd Most Improved U.S. Housing Market 2010
How Boston Real Estate Will Be Helped by Rising Interest Rates
Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

Boston Mayor Welcomes 45 New Retailers To Back Bay

]]> http://blog.wesellboston.net/boston-homes/boston-mayor-welcomes-45-new-retailers-to-back-bay/feed/ 1 http://blog.wesellboston.net/boston-condos/boston-condos-stay-expensive-despite-lower-demand/ http://blog.wesellboston.net/boston-condos/boston-condos-stay-expensive-despite-lower-demand/#comments Wed, 07 Jul 2010 16:15:16 +0000 Jeff Persons http://blog.wesellboston.net/?p=2732

Boston Condos Number of Sales and Sales Prices
First Half – 2000 to 2010

The above graph illustrates how Boston Condos sales go against the grain and stay priced strong even if demand slows down. These stats were comprised using Back Bay, Beacon Hill, South End and Fenway. Notice 2009 where there were only 214 units sold without a lowering of prices.

My opinion is that it would take several years like 2009 for the lack of demand to negatively impact prices to the downside in any significant way.

So my advice without the crystal ball has to be:
If you are waiting for lower prices for Boston Condos, I wish you patience.

Here are the statistics

2010 First half Boston condos sales prices
The average Boston condo sales price – $592,168
377 Sold, average price per square foot: $629

2009 First half Boston condos sales prices
The average Boston condo sales price – $591,289
214 Sold, average price per square foot: $627

2008 First half Boston condos sales prices
The average Boston condo sales price – $592,108
378 Sold, average price per square foot: $492

2007 First half Boston condos sales prices
The average Boston condo sales price – $593,875
368 Sold, average price per square foot: $610

2006 First half Boston condos sales prices
The average Boston condo sales price – $579,413
314 Sold, average list price per square foot: $609

2005 First half Boston condos sales prices
The average Boston condo sales price – $577,597
345 Sold, average price per square foot: $598

2004 First half Boston condos sales prices
The average Boston condo sales price – $573,830
245 Sold, average price per square foot: $545

2003 First half Boston condos sales prices
The average Boston condo sales price – $557,354
156 Sold, average price per square foot: $523

2002 First half Boston condos sales prices
The average Boston condo sales price – $572,042
114 Sold, average price per square foot: $529

2001 First half Boston condos sales prices
The average Boston condo sales price – $555,120
54 Sold, average price per square foot: $493

2000 First half Boston condos sales prices
The average Boston condo sales price – $556,631
35 Sold, average price per square foot: $436

For the sake of manageable numbers I used: Property Type(s): CC , Status: UAG, SLD , Timeframe: 1/1/00 – 7/1/00 Price: Between $400,000 and $900,000,  Towns: Boston:Back Bay, MA; Boston:Beacon Hill, MA; Boston:South End, MA; Boston:The Fenway, MA

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons

More articles by Jeff:

Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

The Boston Real Estate Market Has NOT Experienced a Recession

5 Smartest Protections For Buying Boston Area Homes

It Doesn’t Surprise Me That Boston Real Estate Prices Are Holding firm

The Best Time to Buy Boston Real Estate in 2010

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

Boston Condos Prices Stay Expensive Despite Lower Demand

More Evidence That Boston Real Estate Is a Recession-Proof Investment

2nd Quarter Report 2000-2010

The Average Price Per Sq. Ft. For Back Bay Boston Condos
Has Doubled From 2000-2010

Average Boston Back Bay Condos Price Per Square Foot

______________________________________________________
______________________________________________________

The Average Sales Price For Back Bay Boston Condos
Has More Than Doubled From 2000-2010

Average Boston Back Bay Condos Sales Price

There are some caveats of course. The new luxury units in Back Bay have had an disproportionate influence on these numbers. However these are nice looking graphic representations of a very healthy market.

Here are the statistics

2010 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $1,279,425
Average List Price per Square Foot: $951

2009 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $1,037,912
Average List Price per Square Foot: $884

2008 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $1,005,114
Average List Price per Square Foot: $896

2007 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $1,016,957
Average List Price per Square Foot: $830

2006 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $783,899
Average List Price per Square Foot: $766

2005 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $783,899
Average List Price per Square Foot: $741

2004 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $758,101
Average List Price per Square Foot: $731

2003 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $614,576
Average List Price per Square Foot: $626

2002 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $664,093
Average List Price per Square Foot: $633

2001 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $636,800
Average List Price per Square Foot: $590

2000 2nd Q all Back Bay Boston condos sales prices
The average Back Bay condo sales price – $530,250
Average List Price per Square Foot: $500

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

Jeff is a former stock trader and a student of the markets.

More articles by Jeff:

Recession Proof Boston Real Estate and the Megaphone Formation

5 Smartest Protections For Buying Boston Area Homes

Buying Boston Real Estate, The Pre-Approval Letter Must Come First

The Boston Real Estate Market Has NOT Experienced a Recession

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

Contact Jeff

Today’s Mortgage Rates

Return To WeSellBoston.Net

Back Bay Boston Condos Prices Double From 2000-2010

]]> http://blog.wesellboston.net/boston-condos/back-bay-boston-condos-prices-double-from-2000-2010/feed/ 0 http://blog.wesellboston.net/boston-homes/the-best-time-to-buy-boston-real-estate-in-2010/ http://blog.wesellboston.net/boston-homes/the-best-time-to-buy-boston-real-estate-in-2010/#comments Fri, 25 Jun 2010 15:28:05 +0000 Jeff Persons http://blog.wesellboston.net/?p=2529

I thought I’d update the blog post I wrote earlier this year ‘”A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn” Now that the tax incentive has passed, the buyers who are interested in Boston Condos for September 1st will be the next wave of buyers to clear out. To get something for September 1st a buyer would have to commit to the purchase by August 1st.

In the stock market we would call what is about to happen from August 1st to October 15th 2010 a cyclical buyers market inside a secular buyers market . I’ll explain. Real Estate generally speaking  is in the middle of a secular buyers market in a macroeconomic sense. This started in the second half of 2008 and can go on for several years.  At the same time Boston Real Estate enters a cyclical (shorter term) buyers market every year on August 1st and goes through to say January 15th 2011 or so each and every year. Although the cycle actually goes to January 15th, after October 15th sellers start to take their properties off the market for the holidays.

Sellers start to realize that its now or next spring!

At the beginning of August the buyers gain strength and the bidding wars will stop. Buyers won’t even be going to open houses never mind participating in bidding wars. This is when to start thinking about putting in an offer if you find something you like. Chances are that yours will be the only offer at that time. This situation gets better for the buyers and worse for the sellers right through January 2011. The lowest prices per square foot are accomplished in November and December every year.

The problem with waiting until November is that a lot of sellers may have taken their property off the market until the spring 2011 market. They don’t want showings and open houses during the holiday season. So the available layouts can be limited. Its my opinion that the perfect timing would be between August 1st and October 15th or so.

Boston Real Estate Secular Buyers Market

This cyclical buyers market inside the larger secular buyers market will make for some good buys. When two cycles overlap like this it means even more downward pressure on prices. Of course this is Boston and Boston Suburbs so don’t expect anyone to give their property away.

Please don’t call me if you are a bargain hunter who thinks they can steal a property for under fair market value. Buyers Agency is an alignment with truth. After I do the quantitative analysis of the property I give my buyers a short range of fair market value within which they are in no danger of overpaying. This is job number one for a Buyers Agent of course. If the asking price is above my number, I don’t recommend the purchase.

Do everyone a favor and be willing to pay fair market value for the Boston Home you are interested in.

This may be the best time to buy this year but who knows about next year. In fact my personal opinion after spending the last 15 years studying the markets is that the recovery in the economy will continue and with it there will be a firming up of Boston Home prices. At the FOMC meeting the Fed left rates unchanged with no signs of inflation. The Fed, in their post meeting statement said that  “ The economic recovery is proceeding”.

If this recession follows the pattern of the last five, by next spring there will be no looking back as home prices should start firming up and moving higher.

Please don’t take this as a market prediction. Just because the economy has recovered this way for the last five consumer lead recessions doesn’t mean it will happen that way again. Markets have an uncanny tendency to do the opposite of whatever the general consensus of opinion is saying. The only thing we know for sure is what has happened. We know what properties have sold for and a few other stats and that is all we have. Everything else that can be said about any particular property is too strongly influenced by conjecture and personal opinion, the Buyers Agent’s enemies. To these facts regarding sold statistics, we add our human brain which is so good at spotting playable patterns in the markets.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

Jeff is a former stock trader and a student of the markets.

More articles by Jeff:

If The Unemployment Rate Goes Down, Does Boston Real Estate Go Up?

5 Smartest Protections For Buying Boston Area Homes

Buying Boston Real Estate, The Pre-Approval Letter Must Come First

Boston Condo Buyers, Protect Yourself With Some Rigorous Math

How To Establish Fair Market Value For Boston Suburb Homes

Contact Jeff

Todays Mortgage Rates

Return To WeSellBoston.Net

The Best Time to Buy Boston Real Estate in 2010

I have taken the liberty of making some corrections to this oh so scholarly report
that is just plain wrong.

Job growth Economic growth will be the key factor in whether the U.S. real estate market can extend a recovery after the end of the federal homebuyer tax credit, according to a Harvard University study.

High unemployment Lack of growth in the economy is fueling the foreclosure crisis and discouraging the household formation that drives property demand, according to the State of the Nation’s Housing report issued today by Harvard’s Joint Center for Housing Studies. The labor market weak economy resulted in people “doubling up,” or sharing residences, rather than buying their own home, the report said.

“What happens with jobs will matter How fast the economy rebounds will matter the most to the strength of the housing rebound,” said the executive director some guy from the center in Cambridge, Massachusetts. “If employment growth economic growth surprises on the upside or downside, housing numbers could too.” Consumer confidence Growth in the economy now needs to improve for the market to sustain itself, he said in an interview.

This Harvard Study is Backwards Baloney

Here is a walk down memory lane. As you can see from this chart housing prices gained as recovery in the economy took place.

Please believe me when I say that stock traders don’t watch the unemplyment rate. Its common knowledge on the street that the number is useless. What they do watch are predictive numbers like CPI (Consumer Price Index) and PPI ( Producers Price Index) along with the GDP numbers of course.

And for those who think the we have experienced a recession in prices for Boston Real Estate, I offer this chart that shows a flatline in prices since 2004/2005. As real estate agents we are looking for an increase in the number of transactions as evidence of recovery, not prices. Prices have not gone anywhere.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

Jeff is a former stock trader and a student of the markets.

More articles by Jeff:

If The Unemployment Rate Goes Down, Does Boston Real Estate Go Up?

5 Smartest Protections For Buying Boston Area Homes

Buying Boston Real Estate, The Pre-Approval Letter Must Come First

A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn

Boston Condo Buyers, Protect Yourself With Some Rigorous Math

Contact Jeff

Return To WeSellBoston.Net

U.S. Housing Recovery Dependent on Jobs-Harvard Report

From Bloomberg Business Week

No. 2: Boston MA

Q1 Home price index: 6 percent
Q1 Foreclosure rate (YOY change): 2.1 percent (up 32.8 percent)
Q1 90+ day delinquency rate (YOY change): 7.2 percent (up 43 percent)
April 2010 unemployment rate: 7.9 percent

In the first quarter, the Boston area had the second-largest home price increase (6 percent) among the 50 metros surveyed, according to CoreLogic data. A report by the Concord Group, a real estate consultancy, projects recovery (or sustainable home sales and price appreciation) in the metro Boston housing market in late 2011, ahead of other areas. Boston, supported by a strong education sector, was hit earlier and less severely by the housing crisis than other places, and the unemployment rate here has stayed below the national average.

Is the Upturn Sustainable?

Sam Khater, a senior economist at CoreLogic, says government subsidies and low interest rates have temporarily boosted demand. A good portion of the gains in home sales this year are due to the federal first-time buyer and repeat buyer tax credits, which expired on Apr. 30,

Optimism About Next Year

Despite the projected dips over the next months and years, an end is in sight. An April report on the Fiserv-Case Shiller home price indexes says a prolonged recovery will begin early next year, and some markets are poised for a relatively fast recovery, including those that did not see large price declines, like Boston.

Here Are The Rest Of The List Of Most Improved Cities:

Denver CO,  Boston MA,  St Louis MO,  Pittsburg PA,  San Jose CA,  San Francisco CA,  Washington DC, Cincinnati OH,  Minneapolis MN,  Milwaukee WI,  Cleveland OH,  Dallas TX,  Kansas City MO, Columbus OH,  San Diego CA,  Houston TX,  Santa Ana CA,  Indianapolis IA

The numbers have been saying this all along but it validates what I’ve been saying which its a good thing because  I was really carrying on and getting some push back from the brokerage community with articles like “Boston Real Estate, A Recession Proof Investment” and “Recession Proof Boston Real Estate and the Megaphone Formation” and Will The Boston Real Estate Market Come Back? Check With Me Next Year“. Sure am glad to be in Boston! We could be in Miami or Phoenix where things are a lot worse.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443
More articles by Jeff:

If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much

Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Contact Jeff

Return To WeSellBoston.Net

Boston Real Estate 2nd Most Improved U.S. Housing Market 2010

The Commonwealth of Massachusetts has some very effective consumer protections built into the home buying process. In Boston and Boston Suburbs paying attention to the following list of 5  high risk areas can help you avoid catastrophic mistakes.

Number 1. Find Out What You Can Afford

I made this tip number 1 because its the most expensive for the buyer when done incorrectly. I have had excruciating experiences with Boston Condo buyers who come into Boston on a trip specifically made for buying a Boston Home. All that travel, planning time and expense only to find out that the recently uptight banks will not fund the purchase. This after 2 days of planning, 2 days of looking at properties and another day negotiating the offer. All this with a Pre-Qualification letter in hand! A full weeks worth of work for the buyers and the Buyers Agent and then the bank says no can do, sorry. I have always been very cavalier about Pre-Qualification letters, preferring to talk about money after I’ve had a chance to get to know my buyers. As hard as I find it to talk to strangers about money right from the start, I have to do it to protect my buyers as well as myself.

The old style of Pre-Qualification letter does not cut it any longer. Read my article “Buying Boston Real Estate, The Pre-Approval Letter Must Come First“. The letters now have to be more specific. Tell the bank exactly what you want to buy. Be specific with amounts and sources of down payment funds, a gift is treated differently from cash assets you have accumulated. Where is the down payment coming from? Is your down payment large enough? Find out all you can and get a firm commitment from the bank before spending enormous amounts of time searching for properties

Number 2. Find an Accredited Buyers Agent

You need to be represented by a Buyers Agent. The sellers will not respect your intelligence if you walk in to an open house or arrange a showing without a Buyers Agent! I won’t go through the dozens of reasons for having a Buyers Agent. Regular readers have probably heard enough of that from me. Just a glance at the articles to the right tell you how important I think this is. Like my article “Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney“. If you don’t bother getting Buyers Agency representation, which costs you nothing, and can save you tens of thousands, how can you expect a good deal from the seller?

Number 3. Get a Qualified Licensed Home Inspector

Always, always, always get the home inspected. Don’t think you don’t need one because the home is new or newly renovated, that’s all the more reason to have the inspection done. The inspector finds things we don’t see, period. I’ve seen real financial and emotional pain avoided by rejecting a home because of problems that came up during the inspection. This is especially true for new construction as there are plenty of builders out there who do a substandard job. List of Home Inspectors. Also, if you have young children you will probably want to test for lead if the home was built more than 30 years ago. This is another $400 but you will know how much and where  the lead is as well as guidance as to how to get rid ot it.

Number 4. Get a Real Estate Lawyer

This is a must. Talk about ways for shooting yourself in the foot! Get a good lawyer who is experienced in the type of property you are going to buy. If its a condo, get a lawyer who does a lot of condos. Most Boston Condos have a long history and a stack of condominium documents 3 inches high. Without a lawyer you are wide open for something going terribly wrong. It could have been sold illegally somewhere down the line, the title may have problems. Your lawyer will see those coming and make sure you have title insurance. This protects you if your title is challenged by anyone including heirs of former owners. Your real estate lawyer actually reads that 3 inch stack of documents looking for red flags. List of Real Estate Lawyers

Another protection that should be watched closely is your Mortgage Contingency confirmation date. This is the date when the bank gives you a final loan approval confirmation letter. I usually write this date into the offer for 4 weeks after the offer is accepted and 2 weeks before the closing. This date bears watching because if it passes by and you don’t get your confirmation from the bank, your 5 percent deposit is at risk for what the lawyers call nonperformance or essentially breach of contract. The sellers can keep part or all of your deposit. All is well though if the date is closely watched and if the bank is late with the letter a request for an extension is agreed to by both parties. If the bank changes its mind you get all your deposits back because of this contingency.

Number 5. Investigate Everything.

Now that you have a Buyers Agent, Lawyer,and Home Inspector its time to investigate everything. One of the best consumer protections provided by the Commonwealth of Massachusetts is you can take a property off the market for a $1000 deposit. Some states have this initial earnest money deposit amount as high as 10,000. Then you are given 2 weeks to investigate the property before you sign a purchase and sale agreement where you will put down more like 5 percent of the purchase price. After this 2 week investigation, you should know everything anyone knows about the building, the condo or the single family home. If at that time there is anything you don’t like, they will give the $1000 back and you can be on your way back to the shopping stage. The only money the investigation should cost you is the price of the inspection which is about $400. You won’t run up any legal bills if the property fails inspection, your lawyer will wait for the property to pass inspection before she starts to work on the offer. This is one of the most important consumer protections provided by Massachusetts. I’ll probably get some flak from listing agents for saying this but the Offer to Purchase is a “swiss cheese” contract and I’ve never seen anyone being held to it. There are so many contingencies that you essentially have 2 weeks to say uhhh never mind.

If you are buying a Boston condo (4 out of 5 Boston Homes are condos), investigate the condo association and the management company. Read the condominium documents, and talk with at least 2 trustees. Hang around at different times of day, try to meet as many neighbors as you can and ask how happy they are. If you are buying a single family, visit at all times of day. Listen for barking dogs with negligent owners and other sources of noise, like teenagers hanging out on the same corner every night drinking and starting fights etc. Believe me I’ve run into these things.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443
More articles by Jeff:

Recession Proof Boston Real Estate and the Megaphone Formation
Found a Boston Home I Really Like But What About This Inspection Report?
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Contact Jeff

Return To WeSellBoston.Net

5 Smartest Protections For Buying Boston Area Homes

Downtown Boston and Boston Suburbs Are Just Beginning
To Move In Opposite Directions

It has been my contention that downtown Boston Real Estate is recession proof and will stabilize in price before heading higher while Boston Suburbs real estate will continue to languish.  Because there have been so many home buyers who wanted to get into downtown that as soon as prices showed some weakness a new group of buyers stepped in. Some of these buyers have been on the lookout for weakness in the downtown market.

Looking for a buying opportunity.

On the charts its obvious the two areas are going in opposite directions.The classic megaphone pattern is a dead give away showing the directions each will take.

The major difference between the desirability of downtown Boston as opposed to Boston Suburbs is also obvious. When you live in a downtown Boston neighborhood or Brookline you are close to the best schools and hospitals in the WORLD,  while if you are in Medfield or Franklin or Walpole, you have the advantage of  having access to what Boston has to offer, however the languishing market and foreclosures in the Boston Suburbs will continue. This weakness in Boston Suburbs real estate does not surprise me. Although there is every reason for them to be substantially more desireable and expensive than any other suburb in the country, I think they have further to go to the downside. I believe that more people want to jump from the suburbs to downtown than the other way around. One big reason is that people would love to drop the 5 to 15 hours of commuting time they spend every week. They have wanted to do this for a long time and have been waiting for downtown to get less expensive.

Unfortunately, I think that ship has sailed. Bargains will be gone from downtown. Check out my article “If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months ”

________________________________________________________________

This from the Boston Herald this morning emphasizes my point

Boston condo sellers slow to adjust prices downward

Downtown Boston condo sellers must have missed the memo. Of the 497 condos listed for sale in the Back Bay, Beacon Hill, and Midtown neighborhoods, only 200 (40%) have had price adjustments. Some of the properties still at full-price were first listed for sale as far back as April, 2008 and many were listed before the turn of this year. Not all owners are turning a tin ear to what the market is telling them; average current list price is at 90% of its original price and some as much as 30% off.

The downtown market is showing stable but uneven results. There were 153 condo sales during the past three months in these neighborhoods with a $755,000 median sales price compared to 113 sales in 2009 with a $637,500 median sales price but less than the 192 condo sales during 2008 with a $563,125 median sales price.
____________________________________________

Downtown Boston never looses its desirability. There is always a med student, professor, doctor, nurse, student, high tech worker, financial analyst or biomedical professional trying to get into the downtown neighborhoods where they work or go to school. Even with the new luxury Boston condo developments, inventory is very limited.

I do a daily inventory watch for Back Bay, Beacon Hill, South End and Fenway priced between 300K and 600K because thats where most people live socioeconomically speaking. This is the list I send to prospective buyers when I don’t yet know where they want to be or how much they can spend. The number varies from 113 in the winter to 290 this morning in the middle of the spring market.

This metric hasn’t changed in 8 years and counting.

The supply/demand balance will stay very different between Boston Condos and Boston Suburbs homes. Interest downtown is on the increase while interest is diminishing in the suburbs.

Do you agree? Your comments will be appreciated!

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443
Jeff was a stock trader for 5 years and is a technical analyst and student of the markets.
Contact Jeff   

Return To WeSellBoston.Net
 

I like noodling around with MLS and Excel so I can get a graphic sense
of the Boston Real Estate Market.
I thought I’d take a look at these parameters from 2002 to 2010
Boston Condos sold in January and May for the last 8 years

For the sake of handling smaller numbers, I used the following parameters:

Property Type(s): Condos
Status: Under Agreement or Sold
Price: Between $300,000 and $600,000
Towns: Boston:Back Bay, Beacon Hill, MA, South End, The Fenway

So the next job for me would be to do the research that would tell us how many of the Boston Condos sold in May 2010 were inspired by the tax credits. If anyone cared. I don’t. I just thought this was a striking graphic for a slice of the Boston Real Estate market right in the middle of the spring market for the last 8 years. What do you think? Your comments would be appreciated.

On Another Note

I don’t need to tell regular readers of this blog that I was a stock trader for a number of years. I am finding that the Boston real estate market and the stock market have a lot in common. One popular saying on Wall Street is “However January goes, so goes the rest of the year” I know its just a saying and therefore lacks the rigor we get with statistical fact. But as usual there is some truth in most sayings like this so I pulled the graphic below  made with the same parameters above.

The saying certainly holds true for Boston Real Estate. Those in the business will see it clearly because they distinctly remember the real estate business in these years. Its so closely hinged to their income. For me 2004, 2005 and 2007 were the best years in my business. These had the best January sales. Neat huh?

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

Contact Jeff

jpersons@wesellboston.net

More articles by Jeff Persons:
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Return To WeSellBoston.Net

Boston Condos Sold in January and May 2002 to 2010

Draft guidelines for the new Rose Kennedy Greenway have been released. Height and density recommendations show a number of winners and losers in the downtown Boston Real Estate market.

The Boston Redevelopment Authority has been working with its consultants, Utile, Greenberg Consultants, HR&A Advisers, and Nelson/Nygaard, over the last year and a half on the Greenway District Planning Study. There have been seven public meetings held as part of this process.

As you can see from the BRA draft rendering of the Boston Waterfront, if the guidelines are adopted, heights will vary widely on the Greenway.

As expected, the approved height for the parcel currently the site of the Boston Harbor Garage (next to the Aquarium) is limited to 200-feet, well below the height preferred by Boston developer Donald Chiofaro, who has released renderings showing two towers at that site, one that is well-over 500 feet tall.

The BRA seems to expect that buildings of density will someday soon be built on the parcel currently the site of the Congress Street Garage as it has drawn in several mid-rise and high-rise towers.

Meanwhile,  in the Chinatown section of downtown Boston, it looks as if a new tower on the site of the Dainty Dot building is a go as is the Hudson Street (Parcel 24) affordable housing project.

Of interest is that several new projects I’ve heard little about are shown. The first is a high-rise (150-200′) on the “Hardware/NSTAR” site near South Station and Dewey Square, a mid-rise (6-10 stories, 175′) tower on the site of what was Hook Lobster and a 200′ tower across Northern Avenue where the US Coast Guard building now stands.

The guidelines are focused solely on the land abutting the Greenway and not on-top of the Greenway. So, there’s no building shown above the ramps facing the North End, no sign of the proposed new YMCA.

The release of the draft kicks off a 30-day public review / comment process after which the BRA will present final guidelines to the BRA Board of Directors on June 22nd.

Once the Board adopts the guidelines, they will be used as part of the City of Boston’s Article 80 Development Review Process.

More information: Greenway District Planning Study - Boston Redevelopment Authority -  Source: Boston Herald

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443
Contact Jeff

More articles by Jeff Persons:
The Boston Real Estate Market Has NOT Experienced a Recession
Will The Boston Real Estate Market Come Back? Check With Me Next Year
Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Return To WeSellBoston.Net

BRA Releases Rose Kennedy Greenway Draft Guidelines

Here comes the end of the spring market in Boston Real Estate. My feeling after reading the latest financial news is that the bear market in Boston Real Estate is about to resume. This agrees with my  W bottom prognosis that I wrote about in this article “Will The Boston Real Estate Market Come Back? Check With Me Next Year”

Market bottoms tend to trace out a  W shape at the bottom. It happens in all markets and actually represents human nature but that’s a story for another day.

Although this will mean even fewer than normal transactions between July 15th (the cut off point for Sept occupancy) and March 2011, I’m not at all sure it will affect PRICES in downtown Boston. For prices to decline during this second dip, demand for downtown would have to let up. That doesn’t seem to happen and I’m firmly in the camp of ” I’ll believe it when I see it.”

Here is the chart that displays the first part of the  W bottom we have put in:

The second half of the  W is sometimes mistakenly referred to as a “double dip”. This is not a double dip recession yet, although in Boston Real Estate it will feel like it.  This is just the second half of the bottom we should be putting in this Autumn/Winter and it will be slowly graphed out between here and spring of 2011, just like it did in 1992(see above). In the meantime, I think that this second move down may be the last good buying opportunity in an expensive city that will get more expensive after the  W is complete.

Market predictions are BS but some patterns repeat themselves in technical analysis like the chart above. I’m so good at being wrong sometimes that all my predictions are presented with these two caveats:

“Barring any unforeseen disasters and other exogenous events.”

and

“Just because this pattern of the  W bottom has happened at the end of the last 5 consumer lead recessions, doesn’t mean it will happen that way again, ever.”

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons  617-512-3443

More reading from Jeff:

A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months
How Boston Real Estate Will Be Helped by Rising Interest Rates
It Doesn’t Surprise Me That Boston Real Estate Prices Are Holding firm
How to Get the Lowest Prices on Real Estate by Buying in the Winter

Return To WeSellBoston.Net

The Bear Market in Boston Real Estate Resumes

RE/MAX agents once again outperformed the competition in the 2010 U.S. REAL Trends 500 survey.

RE/MAX brokerages held 122 spots, or 24%, on the list of 500 positions, more than any other national brand. RE/MAX also led the rankings in total transaction sides and sales volume, according to the report’s top 500 rankings based on transaction sides.

In the participating offices, RE/MAX agents averaged 14.4 transaction sides, 46% higher than the next closest competitor. Individual RE/MAX agents averaged $2.98 million in sales volume – 157% more than the average Keller Williams agent.

“Our agents and offices made a commitment to succeed despite the distressed property market, and these numbers prove they did it,” says Dave Liniger (ABR, CDPE, CRB), RE/MAX Chairman and Co-Founder. “Our agents were challenged a year ago to get specific training so they could tackle the market, and I’m proud to say that RE/MAX agents have helped thousands of families, many facing severe financial problems.”

Since March 2009, more than 15,000 RE/MAX Sales Associates have earned a distressed property designation from RE/MAX University. That training, Liniger says, combined with having the best educated and the most experienced full-time real estate professionals in the industry, helped RE/MAX come out on top in this year’s survey.

Presented by RE/MAX Destiny Accredited Buyers Agent Jeff Persons  617-512-3443

More reading from Jeff:

5 Worst Questions To Ask Your Buyers Agent
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
How Boston Real Estate Will Be Helped by Rising Interest Rates
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs

Return To WeSellBoston.Net

RE/MAX on Top in REAL Trends 500

In the good old days like 2002 to 2007 when everyone easily got their loan approved, the Pre-Qualification letter used to be an afterthought. So buyers had the motivation of acquiring the new property to get them started going through the invasive RPITA (Royal Pain In The Ass) part of working it out with the banks, down payment amounts, interest rates, income verification and all the other bank stuff.

The  personal questions from the bank seem like an invasion of privacy.
Who wants to go through that when you don’t even have a property in mind?

We didn’t worry about the Pre-Qualification letter and I can’t remember anyone ever getting turned down from 2002 to 2007, except for this one guy who had all his money in his company’s stock and it cratered as we were about to sign a purchase and sale agreement. Bummer!

So everyone got their mortgage approved. If you didn’t have a down payment, they would lend that to you also.

This speaks to the fact that it was too easy to get a mortgage.

As I like to say- ” New Day My Dear”

For those who have read my “Buying Boston Real Estate 101″ course, AKA the 40 or so blog posts currently on this site, I don’t need to go on any more than I have about all the advantages of being represented by an Accredited Buyers Agent. I am always absolutely astonished when I hear of someone NOT using a Buyers agent.

It used to be so easy, buyers would just call an agent, ask to see some properties and if the agent asked about a Pre-Qualification letter, the buyers would just reassure them that they could produce one. And most buyers could produce one but then again its a new day my dear.

Buyers, Be Represented, Not Sold!

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons  -  617-512-3443

More articles by Jeff:
5 Worst Questions To Ask Your Buyers Agent
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
How Boston Real Estate Will Be Helped by Rising Interest Rates
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs

Return To WeSellBoston.Net

Buying Boston Real Estate? Start With A Pre-Qualification Letter

Boston Condos Average Price Per Square Foot

Here I have put in Graphic form what I outlined in my article:

“The Boston Real Estate Market Has NOT Experienced a Recession. ”
I like using the average price per sq. ft. as it gives me a true sense of relative prices.

Boston Condo Sales 1/1/07 – 5/15/07
Number of Boston condo sales – 364
Avg Boston condo sales price – $487,206
Average list price per square foot: $406

Boston Condo Sales 1/1/08 – 5/15/08
Number of Boston condo sales – 284
Avg Boston condo sales price – $368,250
Average list price per square foot: $350

Boston Condo Sales 1/1/09 – 5/15/09
Number of Boston condo sales – 180
Avg Boston condo sales price – $487,206
Average list price per square foot: $406

Boston Condo Sales 1/1/10 – 5/15/10
Number of Boston condo sales – 436
Avg Boston condo sales price – $489,365
Average list price per square foot: $372

Here are the parameters I used:

Property Type(s): CC
Status: UAG, SLD
Timeframe: 1/1/07 – 5/15/07  -  1/1/10-5/15/10
Price: Between $400,000 and $600,000
Towns: Boston, MA

I like making a graphic representation of these numbers so we can really get the feel for how tough this Boston Real Estate market is hanging in there.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons  617-512-3443

More articles by Jeff:

5 Worst Questions To Ask Your Buyers Agent

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

Boston Real Estate, A Recession Proof Investment

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much

Return To WeSellBoston.Net

Boston Condo Sales Four Year Price Per Square Foot Averages

These 5  Steps create a good guide for buying a Boston Home

Number 1. Find out what you can afford.

I’ve seen buyers start out looking in the 500Ks, then they talk to their bank and next thing you know they want to see the 400Ks. After a while looking in the 400Ks they start to realize that Boston is a very expensive city. To get the amount of space for most people to live comfortably they may find themselves looking in Melrose or Wakefield or some other suburb. My point is find out FIRST, before you ask an agent to show you some properties.

Number 2. Check out some open houses

If you want to see a sampling of what your money can buy check out some open houses. Do not sign in, they are listing agents who will call and email you to try to sell you some real estate. You want to have your own Accredited Buyers Agent. NEVER work directly with a sellers agent. Once you have seen a few homes that you can afford and it still seems like a good idea, get a letter of  Pre-Qualification from your lender.

Number 3. Find an Accredited Buyers Agent to represent you during the entire process.

Once you know what you can afford and you have a letter in hand from your bank stating specifically what you can afford, its time to find an Accredited Buyers Agent. He or she can help you make sure that you don’t overpay in addition to avoiding a plethora of other pitfalls that your Buyers Agent can spot and help you avoid.

Number 4. Do a full inspection of the home

This investigation should include common areas, roof, heating systems etc. Here is our list of Boston Area Home Inspectors. Also check out the reputation of the management company. There are many unscrupulous management companies out there very capable of bankrupting a condominium association.

Number 5. Find a good Real Estate Lawyer.

I keep a list of the best Boston Area Real Estate Lawyers I have  been working with. It is critical that you have a real estate lawyer versed in Boston Condos or Brookline MA Condos. Condos come with specific problems as well as a 3 inch stack of master deeds and condominium documents. Your lawyer will keep you out of trouble. Wrong place to try to save money. Once you get lined up here are our Helpful Boston Numbers.

You comments will be appreciated!

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More articles by Jeff:

5 Worst Questions To Ask Your Buyers Agent
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
This Secondhand Smoking Case in a Boston Condo is Another Good Reason to Have an Accredited Buyers Agent Represent You
The Boston Real Estate Market Has NOT Experienced a Recession

Return To WeSellBoston.Net

A Buyers Agents Thumbnail For Buying a Boston Home

The Financial world has changed

And its about time I changed the way I do business.

I’ve been a Buyers Agent with RE/MAX since 2002. Since I am hesitant to approach new buyers to talk about their financing, I usually go on anecdotal evidence of my buyers solvency until the offer stage. After all I know they own a home, a happening business and they make XXXK a year between them and all they want to finance is 240K. So I would wait until the offer stage and then say “Oh by the way I need a letter from your bank ASAP.” After all, they are busy business people, they wouldn’t be wasting their time if they were not sure they would get approved.

New Day My Dear

This approach no longer works. Buyers who used to sail through mortgage approval are being shut down much to our wild eyed surprise. These are nice people who thought they were doing the right thing and surely didn’t mean to waste my time or their time. It simply got a LOT harder to get a mortgage.

So my casual, laconic attitude about pre-approval letters has to go.

In addition I need to discuss finances FIRST and in detail. As hard as it is for me personally to approach this subject with total strangers, I have to now or I will put myself right out of business with my lack of rigor. The financing must be discussed in DETAIL before we look at properties. The bank wants to know the whole story about where the down payment is coming from. Is it a gift?  What is the source of the gift? What is the debt to value ratio? Will husband and wife both need to be on the mortgage and deed? Or just the Title for the property? If they use their 401 K, both must sign the deed as it is joint money. Are they a W2 employee?  What percentage on there annual income is commission or bonus?

One new change to the Fannie Mae/Freddie Mac guidelines now states that if more than 25 percent of your income is from bonuses and commissions you are now considered self employed.

Buyers must now run a gauntlet to get that money.

Its like a campaign!

So to get started with my new process, I am changing the second letter I usually send that really spells it out. Here is an excerpt:

____________________________________________________________________________

“Although there is no charge for my services as I am paid by the seller, there is a new company policy in place that requires that you have a pre-approval letter from a bank stating that they will finance the plan you have in mind. Please tell them to be very specific as to loan amounts and down payments, gifts etc. This letter has to be in hand before we look at properties.”

____________________________________________________________________________

No doubt about it, this new paragraph is going to stop some buyers  dead in their tracks, but it will also save me a ton of time working with buyers who are delusional, sociopaths or just plain crazy. I’m done running around showing properties to buyers who are either withholding the fact that they can’t afford the home or just don’t know that the bank will not give them the money.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

More articles by Jeff:

The Boston Real Estate Market Has NOT Experienced a Recession

Boston Real Estate, A Recession Proof Investment

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn

Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Return To WeSellBoston.Net

Buying Boston Real Estate, The Pre-Approval Letter Must Come First

We are pleased present the latest edition of an online quarterly report produced by the Greater Boston Association of REALTORS® (GBAR) which summarizes residential real estate market activity in the GBAR jurisdictional area.

This report contains detailed data from the detached single-family home and condominium markets, including units sold, median price, average days on market, pending sales, and inventory levels, for the first quarter of 2010, with comparison data for the same period last year.  Notably as part of this report, we have incorporated data for 10 communities which are located adjacent to the GBAR jurisdiction.

Boston Area Single Family Homes Sales First Quarter

Boston Area Adjacent Towns Single Family Homes Sales First Quarter

Boston Area Condo Sales First Quarter

Boston Adjacent Towns Condo Sales First Quarter

For Further Information Call RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

Other articles by Jeff:
The Boston Real Estate Market Has NOT Experienced a Recession
Boston Condo Sales Triple In The First 75 Days of 2010
Boston Condos, Would You Let Your Daughter Live There?
Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With
Will The Boston Real Estate Market Come Back? Check With Me Next Year

Return To WeSellBoston.Net

Boston Homes, Boston Condos Sales Report First Quarter 2010

The chart below from LINK really speaks to the invest-ability of Boston Real Estate. The ten year chart has 2 trendlines that I added showing an up-trending market to 2005 and a SIDEWAYS market ever since.

Now you tell me. If Boston Real Estate was not recession proof wouldn’t we see a big dip in 2008 and 2009? Its not there because it didn’t happen. Prices have not been reduced at all, never mind the 20 percent required to say the Boston Real Estate market is in recession.

The Boston Real Estate Market Has NOT experienced a recession

All the brokers are actually complaining about  fewer transactions, but the point is that prices have not dropped so it is NOT a recession at all. What the brokers are complaining about is actually a decrease in the number of homes sold which is their payday after all.

The definition of a recession is a 20 percent reduction in PRICES. If you don’t see it on the chart and I don’t see it on the chart, I guess that means there has been no recession in Boston Real Estate. As far as prices go we have been flat-lining since 2005.

Still Not Convinced?  -  Numbers Do Not Lie  -  Boston Condo Sales

For the following, because of the limits of the MLS system, I made my searches
using the following cross section of sold Boston Condos:

Property Type(s): CC Status: SLD
Timeframe: 1/1/05 – 12/31/05 to 1/1/09 to 12/31/09
Price: Between $450,000 and $600,000
Towns: Boston:Allston, MA; Boston:Back Bay, MA; Boston:Bay Village, MA; Boston:Beacon Hill, MA; Boston:Brighton, MA; Boston:Jamaica Plain, MA; Boston:Leather District, MA; Boston:Midtown, MA; Boston:Mission Hill, MA; Boston:North End, MA; Boston:South End, MA; Boston:The Fenway, MA; Boston:Theatre District, MA; Boston:Waterfront, MA; Boston:West End, MA

2005  -  Number of listings  -  369  -  Average List Price  -  525K  -  Average Sale Price  -  518K

2006  – Number of listings  -  414  -   Average List Price  -  526K  -  Average Sale Price  -  512K

2007  – Number of listings  -  470  -  Average List Price  -  531K  -  Average Sale Price  -  519K

2008  – Number of listings  -  423  -  Average List Price  -  536K  -  Average Sale Price  -  519K

2009  – Number of listings  -  357  -  Average List Price  -  535K  -  Average Sale Price  -  518K

Prices have not given an inch. What other asset class can you say that about? There have been fewer transactions which is feeding the broker’s river of tears, but prices are solid because demand is solid and unrelenting. There is so much competition for Boston Homes because of our Best-In-The-World schools, hospitals (also recession proof) as well as our technology and biotechnology.

Your comments will be appreciated!

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons ABR – 617-512-3443
Jeff has also been a stock trader and will be forever a student of the markets.

More articles by Jeff:
Boston Real Estate, A Recession Proof Investment
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

Return To WeSellBoston.Net

The Boston Real Estate Market Has NOT Experienced a Recession

News Release From The Bureau of Economic Analysis

(an agency of the U.S. Department of Commerce )

Gross Domestic Product: First Quarter 2010 (Advance Estimate)

Real gross domestic product – the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 3.2 percent in the first quarter of 2010, (that is, from the fourth quarter to the first quarter), according to the “advance” estimate released by the Bureau of Economic Analysis.

In the fourth quarter, real GDP increased 5.6 percent. That means there is real growth in the economy and soon the unemployment rate will start to decrease as new jobs are created.

Most folks don’t understand how rising interest rates
are really a sign of good things to come.

Firstly the fed will not raise the prime rate unless they see growth in the economy. That means reducing rates actually worked.  What a relief!  Market watchers were worried that just like in Japan in the 1990’s where they reduced rates all the way to zero and it didn’t work anymore! It no longer stimulated the Japanese economy. Japan was in recession for 15 years!

There may come a time where reducing borrowing costs in America will no longer stimulate the economy just like in Japan’s 15 year recession

Paying 7 percent mortgage interest in a thriving economy is much better than paying 4.75 in a deep recession.

For example, I bought a condo on Commonwealth Avenue in 1998 when the stock market was on the rise in a big way and unemployment was low. The economy was in great shape.  You never even heard the word “foreclosure”. Everyone who wanted to was working. What was the interest rate I paid? 7 percent.

7 percent is not a problem if the economy is rocking. You would probably not even notice as the price of the home would have to be less. It has to be or the unit won’t sell. I bought this unit for 310K and it just changed hands for 455K.

So lets do the math:
$310,000 X 7.00 percent = 21700
$445,000 X 4.75 percent = 21612 – Looks like the same payment?

I’d love to see 7 percent again.

Fear rising interest rates? Are you kidding me?

Boston Real Estate prices in general would have to be lower. Not 30 percent like the example above but lower than they are when the rate is 4.75 percent so in that sense home owners and investors would take a temporary hit. But the upside? The jobs would come back and we would be enjoying all the perks of an expanding economy.

Chances are that unit would not come back to 310K but my point is interest rates are just part of the picture. The most important metric we should be monitoring is the GDP because if its expanding then the lowering of rates worked. This should mean higher mortgage rates and I’m looking forward to that because it means most of us will start making more money no matter what business we are in. This would save the American economy because after using the device of lowering the prime rate, the fed has their back against the wall and they are out of bullets. What else could they do to stimulate the economy? Japan was out of bullets for 15 years.

Your comment will be appreciated!

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons ABR – 617-512-3443
Jeff was also a stock trader and a student of the markets for 5 years

More articles by Jeff:
What is the Stock Market Telling Us About the Real Estate Market?
Boston Real Estate, A Recession Proof Investment
Will The Boston Real Estate Market Come Back? Check With Me Next Year
If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months

Return To WeSellBoston.Net

How Boston Real Estate Will Be Helped by Rising Interest Rates

When real estate buyers relocate to Boston every summer to find housing they want to BUY as opposed to renting, there are some typical stumbling blocks.

The Best Neighborhoods

One such difficulty is finding something affordable in the good neighborhoods. If parents and students know little about Boston, they tend to want to find a Boston home in the best neighborhoods. Once a buyer has been a Boston resident for a few years they get braver and feel comfortable in the more affordable areas, like Jamaica Plain, Mission Hill, Brighton, Allston and Dorchester. There may be 28 neighborhoods in Boston but for folks from out of town there are only 4, Back Bay, Beacon Hill, South End and The Fenway. Another alternative is Brookline which actually peninsulas down into the Fenway and Boston University areas.

The problem comes when the buyers don’t want to waste money on rent but cannot find anything affordable to buy in those areas. For instance, look for a 2 bedroom in Back Bay for under 500K. There are only 5 right now and there is something wrong with all 5. Last year at this time there were 10 available and there was something wrong with all 10 of those also.

If you are looking for a studio, there are 44 properties available under 300K but after you take out the garden units and the total junk, there may be 10 units left that are decent under 300K in BB, BH, SE and Fenway.

As a Realtor I am not supposed to say boo about safety and crime. The official stance of the Realtor is “Call the police for the crime stats”.

Well, I’m also a father and I CAN say “I would not allow my daughter to live here” without breaking any Realtor rules from the Real estate regulators.

So it gets pretty simple. I refuse to even show garden level units if they are intended for young women. If I ever put my daughter into one of those and an attack happened it would ruin her life as well as ruining mine. I would curse they day I tried to save money instead of buying her an upstairs unit. Now the police will probably tell you there has not been a sexual attach for years in those areas, don’t listen, get her up on the 2nd floor.

On the other hand, I just sold a 2 bedroom, 2 bath basement unit to twin 25 year old brothers who were both over 200 pounds and 6 feet tall. I have no problem with that. If I had a son I’d be OK with him living in a basement unit. I try not to genderize my decisions but in this case the risk is too great.

My buyers do not have to worry. I ask for a list of MLS numbers that interest them and by the time they come to town I have culled only the best from the list. By doing this we eliminate a lot of running around. If you are coming to Boston looking for student housing or any other type of housing, call me and I will guide you through safely, efficiently and we can even have an enjoyable time of it.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

Your comments will be appreciated!

Additional articles by Jeff:
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Worst Questions To Ask Your Buyers Agent

Return To WeSellBoston.Net

Boston Condos, Would You Let Your Daughter Live There?

Most market technicians (graph watchers) agree that there is an inverse correlation between unemployment and housing. This makes a ton of common sense as the unemployed do not buy houses. As you look at the graph you will notice that housing was not affected in the recession of 2001 – 2002 because it was a mild manufacturing recession. The other recessions were consumer lead recessions and since 60 percent of Americas GDP comes from consumer spending, those recessions are much deeper.

The unemployment rate is a lagging indicator, meaning that it comes
down 6 months AFTER  the GDP goes positive
and the economy starts to expand.

The recent peak in unemployment is a question mark because although technical charts like this are very good at showing patterns, it would be incorrect to assume that the right hand side of this graph is the high point in the current unemployment rate. Same goes for the low point  in the Case Schiller report for Boston Real Estate. One caveat, the Case Schiller Report has always been about single family homes and I think that is what is reflected on the graph. Boston Real Estate however is 4 to 1 condos so the graph would be similar but it would have a slightly different curve after we change over to the new Case Schiller Condo report.

Written By Jeff Persons, RE/MAX Destiny Accredited Buyers Agent – 617-512-3443

More articles by Jeff:
Will The Boston Real Estate Market Come Back? Check With Me Next Year
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn
5 Worst Questions To Ask Your Buyers Agent

Return To WeSellBoston.Net

If The Unemployment Rate Goes Down, Does Boston Real Estate Go Up?

]]> http://blog.wesellboston.net/boston-homes/if-the-unemployment-rate-goes-down-does-boston-real-estate-go-up/feed/ 4 http://blog.wesellboston.net/boston-homes/a-boston-buyers-agent-says-skip-the-spring-market-wait-until-autumn/ http://blog.wesellboston.net/boston-homes/a-boston-buyers-agent-says-skip-the-spring-market-wait-until-autumn/#comments Mon, 26 Apr 2010 15:30:10 +0000 Jeff Persons http://blog.wesellboston.net/?p=1043

Right now we are in the middle of the spring market in Boston Real Estate. In addition to the tax break seekers and the usual spring time home buyers coming into the market, its a bit frantic out there with multiple bid situations. A lot of these buyers need to buy in the spring when someone in the family has to be settled by September 1st. So what we have right now is an artificially manipulated, short lived sellers market until August 1st.I’m not saying you cannot get a good deal right now but there is tax credit manipulated temporary demand for properties that is going to go away. In addition the latest a buyer can put something under agreement and be ready for September 1st is August 1st. And that is pushing the bank to maximum speed. After August 1st the sellers who still have their property realize that they have missed the spring market and unless they do something they are going to be holding onto that property until NEXT spring.

At the beginning of August the buyers gain strength and the bidding wars will stop. Buyers won’t even be going to open houses never mind participating in bidding wars. This is when to start thinking about putting in an offer if you find something you like. Chances are yours will be the only offer at that time. This situation gets better for the buyers and worse for the sellers right through January 2011. The lowest prices are always accomplished in November and December each and every year.

The problem with waiting until November is that a lot of sellers may have taken their property off the market until the spring 2011 market. They don’t want showings and open houses during the holiday season. So the available layouts can be limited. Its my opinion that the perfect timing would be between August 1st and October 15th or so.

Do not get caught up in the panic buying. Your best chance for a good price with the maximum amount of risk taken out of the purchase, is to wait until at least August 1st.  This little piece of timing is often worth 10 to 20% off of the current asking prices.

Just to show you how playable this is in any market, my best example comes from the up-trending 2007. I had this buyer, Harvey who wanted to buy a charming single family on Gray Street in July of 2006. The best the seller would give us was $1,250,000 or $625 per sq ft. My advice to Harvey was since he had the time, he should wait until November. He may loose this one but there are always more properties. I just could not justify the price. This is a neighborhood that brings $650 per sq ft totally renovated. This single family on Gray Street was a mess and needed 250K.

So the happy ending is Harvey bought the VERY SAME property in January 2007 for $1050,000 or $525 per sq ft. He saved 200K in an up-trending year! I have saved my buyers millions of dollars by helping them time their purchases like this.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons – 617-512-3443

More articles by Jeff:
How to Get the Lowest Prices on Real Estate by Buying in the Winter
Will The Boston Real Estate Market Come Back? Check With Me Next Year
If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months
What is the Stock Market Telling Us About the Real Estate Market?

Return To WeSellBoston.Net

A Boston Buyers Agent Says Skip the Spring Market, Wait Until Autumn

Link Information network has released their first quarter 2011 report. What really struck me was this graph of appreciation over the last 10 years. Its a soothing comfort to me that Boston Real Estate has done a flat-line since 2004 while most of the rest of the country got really pasted.

Boston Real Estate 10 Year Appreciation Index

This chart makes a very strong case for investing in a Boston Home. After all, since 2004 the housing market blew up and we went into the worst recession since the Great Depression. And yet my Boston Home hasn’t lost value. I have written at length about why this is but to sum it up:

The reason Boston Real Estate prices don’t go down is because we have the best schools and hospitals in the WORLD! Add to that our thriving high technology and biomedical industries.

Here is another very telling graph:

Average and Median Selling Prices since 2004

So where is the big disaster?

If you bought a condo in Boston in 2004, you have actually seen some appreciation.

Boston is an expensive city and its very likely to stay that way, barring any terrible exogenous events. The demand never stops. When you want to sell your Boston Condo or your Brookline Condo there is a med student, or a college professor or someone working in finance downtown or someone involved in the burgeoning biotechnology industry across the river in Cambridge, All standing in line to take it off your hands

Asking prices are down only because the sellers stopped being greedy,
but the high valuations are still there.

Written By RE/MAX Destiny Accredited Buyers Agent Jeff Persons  -  617-512-3443

More articles by Jeff:

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Return To WeSellBoston.Net

Boston Real Estate, A Recession Proof Investment

By the time my buyers are ready to make an offer, we have seen all the appropriate properties in their price range and preferences. This has been the easy part mentally and the hard part physically.

Here I would like to reference one of my favorite articles:  “5 Worst Questions To Ask Your Buyers Agent” which outlines all the information we don’t need cluttering up the situation.

By the time we have gotten to the offer stage, if I haven’t done so already, I will do the quantitative analysis to establish what the property is really worth. I usually give the buyer a tight range of appropriate prices with a maximum amount. Once the maximum has been reached, there is no longer any chance of my buyer overpaying for the property.  I give a sigh of relief before I continue the negotiation in an attempt to get it even lower.

Here we don’t have a map to go by except the sold numbers of similar units. Determining fair market value entails a bit of math as well as some common sense. There is no formula that gives us a percentage below asking calculation. Ignore the asking. Its a wild guess compared to the numbers I get after I am  done with my investigation. See my article “Dont Just Investigate Your Boston Condo, Investigate The Management Company Too”.

Once we know what the home is worth, we have all the ammunition we need to stick to our guns. The seller may balk but Buyers Agency is an alignment with truth and if the truth is that the property is worth $xxx, that’s all we are going to pay, period. Unless my buyer is willing to overpay for his own reasons, it doesn’t get a thumbs up from me until we get to fair market value.

Try to get to this agreement with the least amount of back and forth, as there are only so many offers and counter offers before either the buyer or the seller imagines they are being slighted in some way. Actually there are a plethora of negative emotions that creep in on both sides if the negotiation is taking too many offer/counter offer go arounds.

Above all, lay out a strategy with your Buyers Agent and adopt an attitude of openness and generosity. When I say generous I don’t mean paying more than what the home is worth, I mean the little courtesies about the little defects in the property. Often you can get your price if you promise not to nickle/dime the sellers for $200 here and there that may come up during inspection. Put a limit on it for sure but the gesture goes a million miles toward making the price lower and the whole purchase more enjoyable. Being nice goes a long long way!

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons ABR – 617-512-3443

More articles by Jeff Persons ABR:
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
Boston Condo Buyers, Protect Yourself With Some Rigorous Math
How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs
Can I Get Away Without Paying For a Real Estate Attorney?

Return To WeSellBoston.Net

The Psychology of Negotiating The Price of Your Boston Home

This morning our fellow Realtor John Ford released his version of the Boston Condo Sales report.

I went over the numbers myself and pretty much came up with the same figures:

Back Bay Condo Sales

Back Bay condo sales using two metrics: The first includes “all Back Bay condo sales” the second data point is based on “Back Bay re-sales” only. In other words, no new condo developments.

2010 1st Q all condo sales prices:
The average Back Bay condo sales price – $1,375,860
The median Back Bay condo sales price – $1,085,000
The average Back Bay condo sales price per sq ft: $852

2010 1st Q  not including new developments
The average Back Bay condo sales price – $1,122,2244
The median Back Bay condo sales price – $732,000
The average Back Bay condo sales price per sq ft – $787

2009 1st Q all Back Bay condo sales:
The average Back Bay condo sales price – $1,312,442
The median Back Bay condo sales price – $765,000
The average Back Bay condo sales price per sq ft: $778

2009 1st Q not including new developments
The average Back Bay condo sales price – $1,047,562
The median Back Bay condo sales price – $622,000
The average Back Bay condo sales price per sq ft – $752

2008 1st Q all Back Bay sales:
The average Back Bay condo sales price – $1,129,805
The median Back Bay condo sales price – $675,000
The average Back Bay condo sales price per sq ft: $775

2007 1st Q Back Bay condo sales:
The average Back Bay condo sales price – $944,400
The median Back Bay condo sales price – $643,975
The average Back Bay condo sales price per sq ft: $718

So there are the numbers. Does anyone care? Is anyone monitoring these stats?

Is this information useful to my readers and the Boston Real Estate Buyer?

If you have been reading this blog let me know if this is what you want
to read about in our Boston Real Estate Blog

Your comments will definitely be appreciated!

More reading about Boston Condos and Boston Real Estate written by RE/MAX Destiny Exclusive Buyers Representative Jeff Persons ABR, 617-512-3443:

Dont Just Investigate Your Boston Condo, Investigate The Management Company Too
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Can I Get Away Without Paying For a Real Estate Attorney?

Return To WeSellBoston.Net

Boston Real Estate, Back Bay Condos Sales Report

Home inspections can be a real downer, especially if you really like the place. The home feels so good! Its in the right area, right price, right floor. The condo fee is right, the neighbors seem OK. And what a relief to be done looking!

So you put down a deposit and hire a home inspector The home inspector finds a laundry list of problems that are going to cost you money sometimes right away and sometimes over the next 5 years.

What to do? You reopen the negotiation with the seller. Explain to them that you would love to buy the place but can’t afford the mortgage AND the contractor to fix it up. Make a list of the problems that were surprises the inspector found that were not apparent before the offer was made. Once the negotiation starts again, politely give the seller a list of problems and how much they will cost to fix.

The gap between how much you think the seller should discount the damaged property and how much they are willing to bend can be a big problem or not a problem at all. It depends on lots of variables. The things the inspector found were probably known to the seller and this news from the inspector is no surprise. He may have been hoping they would be missed in the inspection.

Where we go from here depends on the agreement established between buyer and seller. If the seller is willing to take something off the agreed upon price this can go very smoothly. But what do you do if the seller says take it or leave it? Although the first reaction of many buyers is a quick We will leave it thanks, I suggest you sleep on it and go over the numbers again with your Buyers Agent. Does it still compare well with similar properties even with the problems? The problems may have already been baked in the cake when they priced it and you might be getting a good deal anyway.

Once I sold a 2 BR, 2BA on Commonwealth Avenue.Represented as totally renovated I had priced it based on that claim. When the inspection revealed that both bathrooms had rotted behind the walls and needed 5K each to fix as the wood had slowly rotted away and had to be taked apart and rebuilt, I knew we had to renegotiate the sales price

So the bathrooms needed 10K total and I felt we needed to double that for the aggravation so we proposed 600K instead of 620K. Seemed reasonable to my buyers and I but to my surprise the seller refused and we walked, but it could have easily have gone the other way.

When you know you can find a similar property that needs nothing, why on earth would you put yourself through the inconvenience of the renovations?

Most sellers are reasonable and compromise, but be sure you are polite about it. Sellers can take offense because it is their home after all and its not surprising that they are insulted if someone is picking it apart.

If the negotiation goes nowhere, my advice is to respectfully walk away. You can assuage your disappointment by reminding yourself that you won’t have to meet the contractor at the property dozens of times hoping upon hope they finish the job correctly.

Hope this post helps some. I promised to make this blog more of a classroom with something to learn in each post. I really feel that if someone were to read all 28 posts on this blog they would have a good basic course on becoming a better Boston Real Estate buyer.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons, 617-512-3443.

Your comments will be appreciated!

More articles by Jeff:

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Negotiating The Price of Your Boston Home – Stick To The Numbers
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
5 Worst Questions To Ask Your Buyers Agent

Return To WeSellBoston.Net

Found a Boston Home I Really Like But What About This Inspection Report?

As a Boston Area Buyers Agent I will represent buyers all the way out to Rt95-128. Buyers Agency has more geographic flexibility than Listing Agency therefore providing more valuable assistance with Boston Relocation. A Listing agent would not take listings so far flung. It wouldn’t be profitable or fair to her sellers. A Buyers Agent however is less limited by locality. I can represent a buyer in Milton and another at the Ritz Towers on Avery Street downtown. Check out our Suburban Boston page for a map and list of cities.

Rt-95 - Rt 128 Loop

With the help of the GPS system and the computer I can go into any neighborhood and tell you what a property is worth.

Establishing fair market value is the challenge. Buyers Agency is an alignment with truth and that is what we are trying to establish here, the truth. While easily done in a city of condos this challenge gets more involved and time consuming when you get to Lexington, Norwood, Weston and other Boston suburbs. If you have a Buyers Agent, he can do the extra work for you.

In the city the condos have so many similarities that it is easy to pull up all 3rd floor rear condos sold on Marlborough St or all front facing 2nd floor studios on Beacon Street over the last 12 months and you are 90 percent there. All you have to do now is compare renovation levels and you have nailed it down or have a short range of fair prices.

The suburbs are handled by quantitative analysis just like the condos but with a few wrinkles thrown in that require the true labor of thought. Here is my process:

First step, I start by treating single family homes just like condos. Compare the property with other sold  homes within a certain distance, same number of bedrooms, bathrooms, garage, etc. I start by using the same calculations I would use for downtown Boston.

Here is where it gets more challenging:

What about lot size?

With a little grade school math I figure out the price per sq ft for the lot also. Not so tough. To this I add or subtract the ineffables like views, position of the lot, usefulness of the lot and is Joes Auto Body shop across the street? These numbers are arrived at a bit more subjectively. Maybe the view is so great you might want to add $50 per sq ft or maybe its so  bad you subtract $50 from the average.

What about garages?

How useful is it? Can you fit a car into it? Or is it a small falling down tool shed the kids are afraid of. Valuation is easily done with simple math but requires some thought and some patience. A number can be reached for the different garages that can be added to the value of the home.  Single, double, big, small, these can all be quantified. I look at the sold homes and compare the garages. Again a bit subjective but my attitude is you can quantify everything about the home. On the more subjective points I may use a range of prices.

What about basements and attics?

Same as garages, the answer here depends on how useful they are as they presently stand and how much potential they might have for becoming living area in the future.

You can see how this can turn into an investment in time here.

When was the home built?

This can tell us a lot. If the construction date is in the Victorian to 1930 range you are probably talking about homes that were built to last 300 years. Varying from home to home, the decade the house was built in is not definitive but can have some importance. For example, Newton MA which is one of Boston’s most expensive suburbs because of their fabulous school system, has a ton of poorly built ranch style homes built in the 50s. Ugly,ugly, ugly!!! While down the street you may find a home built in 1920 that is a beautiful masterpiece of solidly built  construction.

So turn a deaf ear to the listing agent’s monologue about how much the house across the street sold for. Sparsely interesting but it may be apple to oranges

Objectivity and an alignment with truth is what we are after here with all these calculations, but once its done you can enjoy your home for years knowing you did not overpay. Also I can rest assured that I have fulfilled my promise to my buyers to make sure they don’t pay a penny over current fair market value for the home.

Written by REMAX Destiny Exclusive Buyers Agent Jeff Persons 617-512-3443
Your comments will be appreciated!

More articles by Jeff:
Can I Get Away Without Paying For a Real Estate Attorney?
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Negotiating The Price of Your Boston Home – Stick To The Numbers
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs

Return To WeSellBoston.Net

How To Establish Fair Market Value For Boston Suburb Homes

I recently wrote a article called – Boston Homes, Establishing Fair Market Value- In the article I outlined the methods I have developed  to establish fair market value of any property. These methods work really well but they make the assumption that the stated square footage is accurate.

Most Bostons Condos list a square footage that is questionable.

When these townhouses went condo in the late 50s the developers took liberties with the numbers. They lied. No one was watching! I am totally amazed that these brilliant buyers I have (and most are definitely smarter than I am) accept that number as bible.

I’ve remeasured many times with an architect’s help but some are so obvious. For example I put a unit under agreement on Beacon Street. The unit turned out to be a perfect rectangle so it was simple high school geometry to multiply one side to the other and guess what, they had the square footage listed as 25% larger than is physically possible!  Since I was just multiplying 2 sides I was even including closets and storage that were not even living area.

Unfortunately I had to withdraw my offer. I still liked the condo but I couldn’t buy it because I couldn’t sell it. I won’t perpetuate a lie and use the higher number just because its written in the docs.

What I want to say is even if you are lucky enough to have a good Buyers Agent and he does the math (this takes from 20 minutes to 1 hour to do), you still may get tripped up if the listed square footage is a lie, typo, mistake, intentional or unintentional.

The property I referred to on Beacon Street had changed hands many times since 1960 with everyone believing the higher square footage. Buyer after buyer accepting the square footage figure without question.

Whats Wrong With That?

Its worked OK for the last 50 years so whats the problem?

Flowering Trees in Back Bay

The problem comes when you go to sell to a smart buyer who gets an architect for an accurate read on the living area square footage. He then comes to you and tells you your 1400 square foot condo is really 1250 sq ft so at an average of $750 Per sq ft you have your home priced $112,000 too high. Needless to say this is a real bummer for obvious reasons.

It means you paid too much and you can’t get your money
back out of the property.

You could say we will just hold out for a buyer who doesn’t care but there is a moral question here. Are you going to allow yourself to perpetuate this lie? Is it OK to cheat the next guy just because this has been going on for 50 years?

Most will have a problem doing that.

So when your Buyers Agent comes to you and gives you a figure that is supposed to represent fair market value, I suggest you surprise him and everyone else involved by paying to have the place measured and the square footage verified. Remember you are buying square footage at the rate of $750 each in Boston. What else would you buy in large numbers for $750 each without counting?

The suburbs are more difficult but can be approached rigorously with averages. The calculations will eat up some time but answer some very important questions. Stay tuned, Boston Suburbs is the subject of my next post.

Return To WeSellBoston.Net

Contact Jeff

Your comments will be appreciated!

More articles by Jeff Persons RE/MAX Destiny Accredited Buyers Agent-617-512-3443

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Boston Condo Buyers, Protect Yourself With Some Rigorous Math

For those who have not read this blog, let me just say that I was a stock trader from 1996 to 2002. I studied the markets during the boom and the bust. There are certain human behaviors that when put in graphic form make the same pattern time after time. This is called Technical Analysis.

This is my 8th spring in the real estate business as a Buyers Agent in Boston. Normally by April 1st I have a half dozen buyers coming to Boston and I’m busy trying to coordinate property showings. Everyone wants Saturday of course.

Unfortunately, not this year.

I think that a lot of buyers would like to buy but  many are unemployed. Others can’t sell the house they are upside down in. For a plethora of reasons, in this economy buying, selling and moving just don’t seem like such a good idea.

More on the W bottom;

A few weeks ago I wrote a post about the W bottom that occurs in free market economies. – Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With- There are a lot of reasons for this configuration. The W bottom is a graphic representation of human psychology. This happens in ALL markets because of the humans  involved in them. You can look at stock charts, hog futures, commodities, bonds, all markets do this and once it is done you have a legitimate technical bottom for that market for that time.

The first leg down is the housing market was in late 2008 as well as 2009. The middle part of the W is perhaps this spring we are living with all the good news and stimulus. The second leg down in the W occurs because of all the sellers who didn’t get out during the first leg down. They start selling into the firmed up prices we are seeing now which creates the second shallower leg down.

This one should not go as deep.

As the spring market in real estate ends in July,  I’m starting to think we have the next leg down coming, the second dip in the W. This should start on the fourth of July and go to spring 2011. In order for this formation to be good news, the second leg down doesn’t go as deep, (see chart). If it does we have another kind of problem. Also the second and final move up in spring 2011 should be on higher volume than the middle move up we are living right now. Not hard to imagine.

Once this formation is put in we usually have a market that moves higher because all the sellers were shaken out in the second leg of the W. Always with the caveat: baring any exogenous terrible events.

W Bottom for the Stock Market in October 2002

Here is the perfect W bottom (also called the cup and handle) for the stock market bottom in October 2002. Notice the spike in volume immediately following the completion of the W.

I was so hoping that we had put in the W bottom for real estate this spring of 2010 but as time goes by it looks like another slow year in real estate. Keep in mind that I’m speaking as a real estate agent looking for more transactions as the most watched metric. This does not mean you can’t get a good deal at any time in any year. Just make sure you go over the comparables with your Buyers Agent so you know you are not paying over the current market value for the property.

It is starting to look to me that we will not be coming out of the W (like stocks in April 2003) until next spring.

Kind of technical jibberjabber, but it works every time in every market. Knowledge is power and you can be sure I will be looking at real estate sales volume and price charts early next year. With a bit of luck and a recovering economy we should see a more active market in 2011.

One more example is the controversial S&P Case Shiller Index that monitors single family homes. This chart is a 20 city composite so it doesn’t specifically graph Boston or even condos but it is a good illustration of W bottoms.

S&P Case-Shiller Index up to April 2010 - 20 City Composite

Your comments will be appreciated!

Written by Jeff Persons RE/MAX Destiny Accredited Buyers Agent

More reading by Jeff Persons ABR
If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too
This Secondhand Smoking Case in a Boston Condo is Another Good Reason to Have an Accredited Buyers Agent Represent You
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
5 Worst Questions To Ask Your Buyers Agent

Return To WeSellBoston.Net

Will The Boston Real Estate Market Come Back? Check With Me Next Year

Good morning! I woke today and sat to read the Boston Real Estate Blogs. This is probably the most boring thing a body can do. What a lot of blah blah blah! So many of the blogs were about the hopelessly ridiculous $8,000 tax credit that I pulled the blog I made in October where I wrote about the last deadline.

Same situation and I have the same to say about it so here goes:

This deadline for the tax credit puts the $8000 in the SELLERS pocket!

I think the $8000 tax credit is a joke when there is a deadline because the listing agents know this and hold their price. I just put a deal together in the Hyde Park section of Boston. I showed my buyer 12 properties and all of a sudden half went under agreement. Obviously buyers paying up before the deadline. I am a Buyers Agent with very firm quantitative concepts of the prices in Bostons neighborhoods as well as Boston Suburbs. The negotiation was fierce and stubborn from the sellers side because they knew about the deadline. I’m pretty stubborn also, especially when my buyers interests are at stake.  After much more than the usual back and forth I was OK with the price paid, but an easier Buyers Agent (or worse a Sellers Agent in disguise as a Buyers Agent) would have paid at least $8000 more for the property than it’s worth.

Maybe the government has successfully stimulated the housing market. That is great if it worked. We will find out in time, but do not kid yourself about where the tax credit actually goes.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More reading about Boston Real Estate

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

Return To WeSellBoston.Net

This deadline for the tax credit puts the $8000 in the SELLERS pocket!

For property showings in the Boston downtown areas and Brookline, two agents, a Buyers Agent and a Sellers Agent usually must be present. In addition the tenant/owner has to leave their home while you look. So you are inconveniencing three people besides yourself every time you request a showing.

Often, I can tell my buyers have had the following conversation among themselves. It goes something like this:

“Hey its free, lets let Jeff who must have little to do anyway show us some properties so we will know what we can afford out there. And by the way what can we afford out there?”

Here are a few things I would like you to do before you call me.

Get a Pre-Qualified letter from a bank.

You may have all the confidence in the would that you will be able to get a mortgage but the economy has gotten tougher and you should have this letter in your pocket before you go looking. If you see a property that you like and you don’t have your letter, another buyer who does have his letter can beat you to the punch.

Without it you are not even a qualified buyer!

Go to some open houses.

Although you don’t want to deal with the listing agent at the open house, its a good idea to see some open houses to make some basic assessments as to size of the homes as well as the neighborhoods. Its very important that you don’t start dealing with the listing agent at the open house because if you work directly with her you will not have representation. She must represent the seller. Call your Buyers Agent from the open house and ask him to meet you at the property.

Narrow down your options.

You will know from a few open houses which neighborhoods you would be open to living in. Narrow this down and resist the temptation to look at inappropriate properties because they are cheap. Its interesting to realize that you could move to this apartment very inexpensively but if you would not like to live in this area of the city, you are wasting everyone’s time.

Save up some interesting MLS numbers.

You know that eight digit number that starts with a seven? As you go through the listings make a note of these numbers and send them to me in advance. I will go through them, eliminate the bogus listings and I will show you those properties. Keep in mind that we show property seven days a week from 10 AM to 5PM. Please be on time as the showings are appointments, just like your doctor, lawyer or other professional. If you are late we will be late for all the showings, listing agents waiting and owners walking their dogs until we are done. believe me when I tell you, that’s not much fun.

If you can do these things before you call you will see the most appropriate properties in the least amount of time. This is the most efficient way I have found to get the job of finding something you like quickly.

When you are ready, I can provide very helpful Buyers Agency/Buyers Advocacy. You will never hear any manipulative language from me and I’m never in a hurry. I have been  an Accredited Buyers Agent since 2002 and I represent buyers only.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More articles by Jeff:

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
5 Worst Questions To Ask Your Buyers Agent
Dont Just Investigate Your Boston Condo, Investigate The Mangement Company Too

Return To WeSellBoston.Net

Please Be Sure You Are Ready To Act Before You Call Your Buyers Agent

I was amazed how many similar blogs I read after I wrote my post “Boston Condo Sales Triple In The First 75 Days of 2010″ . They all said pretty much the same thing and they all must have gotten the idea at the same time but it would not have been “remarkable” if the numbers were not so convincing.  Such good news for the real estate market!  Get ready for a deluge of media attention to the recovering Boston real estate market.

Does that mean you should buy? Absolutely not.

Boston real estate agents focus on metrics and are constantly writing articles like the one I wrote. I usually avoid those kind of articles. They start to sound like a lot of blah blah blah. Sure its encouraging for the real estate agents who are of course starved for good news, but I promised you in my first blog that I will not produce fluff articles just to get better search engine rankings. This blog is for my reader’s education, not a “Buy a Boston Home” promotion.

Sure the numbers are looking better all around. That doesn’t mean you should buy a Boston Condo. Look at your own situation and decide if you want to participate. Don’t let the artificial urgency that is sure to be inspired by the tax credit and the sold unit numbers get you swept up.  Apparently if you didn’t buy in 2009, you missed the bottom, that might have been a mistake, don’t compound it by buying for the wrong reasons.

Here are some questions you should ask yourself before making the
buying instead of renting decision.

Make Sure You Are Ready

My advice is to look at your situation objectively, your income, job security, as well as how YOU feel about the market. Although renting is much more expensive than buying, it might be the best thing for you for a period of time. Buying is a ton of stress. I’ve seen people buy a house and not get a good nights sleep for years after the purchase because they were so fearful about the commitment.

Wait until the Autumn?

Its usually best to buy in the autumn and early winter because you get to play the annual cyclicality of Boston real estate prices. The lowest prices per sq. ft. are achieved every year in November and December.  2010 might be the perfect year for avoiding the buying panic in the spring and watching as the prices go back down later in the year. The market bottoms out every year at that time.  Unfortunately the inventory does also so the challenge can be finding the layout you can live with.

Think in terms of five years or more.

If you buy a condo or single family, think long term and decide you will be OK if the property value slides back down. Most market bottoms form a “W“. 2010 could be right in the middle of the W and the precurser to the second part of the W bottom. This second leg down is usually shallower than the first (hopefully) but might scare the heck out of you. Be OK with the property anyway, real estate is a long term investment.

Typical W Bottom

Find a Buyers Agent/Buyers Advocate to help you.
Buyers Advocacy is the essence of Buyers Agency

You might need to speak with a few Buyers Agents to find one you like. Find one who uses “Buyers Agency” and “Buyers Advocacy” in the same conversation. I use the term Buyers Advocacy because essentially that is what Buyers Agency really is. Detachment from the outcome (selling some real estate) is the key to impeccably representing a buyer. Make sure your Buyers Agent doesn’t just mimic the Sellers Agent’s non-stop monologue of positive features. Make sure also that he NEVER represents sellers and is an “Exclusive” Buyers Agent. See My article “5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise” for more on how to spot duplicity.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More reading about buying Boston real estate:

5 Worst Questions To Ask Your Buyers Agent

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Dont Just Investigate Your Boston Condo, Investigate The Mangement Company Too

Return To WeSellBoston.Net

Your Comments Will Be Appreciated!

Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With

Back On January 9th I wrote a post “If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months” and now the numbers are telling me that the bottom for Boston Real Estate passed by about six months ago.

It may be a short term bottom and the precursor of another leg down but I don’t think so. As long as the GDP is expanding and the stock market has some traction I wouldn’t come to Boston looking for any “steal deals”.

Sales tripled in Boston Condos in the first 75 days of 2010 when making the easy comparison to the disastrous 2009 but they still doubled over 2008 and are up close to 50 percent from 2007

One of the favorite sayings I learned in my 5 years as a stock trader is “You Gotta Buy Em When They Hate Em”. Well I think the time that they hate Boston Condos has come and gone. Although I usually eschew market predictions but barring any disastrous exogenous events I have to say that I think we’ve just put a bottom in on the Boston Real Estate Market.

Back Bay Condos

1/1/07 – 3/15/07 Sold and U/A – 62 Units Sold, Average price per sq ft – $742

1/1/08 – 3/15/08 Sold and U/A – 49 Units Sold, Average price per sq ft – $1037

1/1/09 – 3/15/09 Sold and U/A – 29 Units Sold, Average price per sq ft – $969

1/1/10 – 3/15/10 Sold and U/A – 100 Units Sold, Average Price per sq ft – $998

Boston Condos (the whole city)

1/1/07 – 3/15/07 Sold and U/A – 682 Units Sold, Average price per sq ft – $427

1/1/08 – 3/15/08 Sold and U/A – 511 Units Sold, Average price per sq ft – $371

1/1/09 – 3/15/09 Sold and U/A – 384 Units Sold, Average price per sq ft – $381

1/1/10 – 3/15/10 Sold and U/A – 1008 Units Sold, Average Price per sq ft – $418

Notice also that prices per sq ft are hanging firm and even rising.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

Your comments will be appreciated!

More articles by Jeff:

How to Get the Lowest Prices on Real Estate by Buying in the Winter

What is the Stock Market Telling Us About the Real Estate Market?

It Doesn’t Surprise Me That Boston Real Estate Prices Are Holding firm

The Boston Real Estate Market Has NOT Experienced a Recession

Return To WeSellBoston.Net

First 75 Days of 2010 Boston Condo Sales Triple

A cautionary tale about how accumulated mistakes made

by the management company can bankrupt a condo association!

Boston Real Estate buyers often ignore the management company when they buy into a new building. They just hear “professionally managed” which sounds fine. This can often be a very expensive mistake that your Accredited Buyers Agent will keep you from making.

Here is an example of how incompetence at the management company can drive up condo fees as well as make life miserable for the owners. This is kind of a long story that I can’t make short, but the education value in considerable so please bear with me.

Once I bought a “dream-come-true” condo on the third floor, front facing on beautiful Commonwealth Avenue in the heart of Back Bay. Fantastic bay windows overlooking what Robert Frost called “The most beautiful street in America”. The condo was tree level so it was perfect for people watching as well as enjoyment of the sparkly lights they keep turned on for 5 months a year.

I bought the unit in 1997, before I got into real estate in 2002, so I was really a “babe in the woods”. I didn’t even know what a Buyers Agent was at this time but this incident actually inspired me to start a career in Boston real estate as a Buyers Agent with an emphasis on buyer protection.

My first clue that I should have used a Buyers Agent came six months after I moved into my dream home. I got a bill to fix the roof in this 52 unit building. My share for the 650 sq ft I owned was $8000. This wouldn’t have come as a surprise if I had had a Buyers Agent when I bought the unit. If I had a Buyers Agent, he would have gotten a copy of the condo association meeting minutes where I would find the conversations about the new roof. But since the new roof hadn’t been officially assessed and I was working directly with the Sellers Agent, the meeting minutes were WITHHELD FROM ME. A Sellers Agent will not offer these to the buyers because the Sellers Agent cannot by law reveal anything about the condo that the seller doesn’t want revealed. Once the repairs are officially assessed then they have to tell you all about it.

So I paid the $8000 and started to read the minutes to the condo association meetings in earnest. Reading the latest minutes I noticed a lot of conversation about refurbishing the 2 elevators in the building. Projected cost for my unit was $16,000, but again not assessed yet. Here is where I decided to sell my dream (nightmare) home. Being the honest type, I shared the projections of the future elevator repairs with the new owners even though I didn’t have to because the new elevators hadn’t been assessed yet. I made sure they got a copy of the minutes and budget so at least they knew it was coming when the bill arrived 6 months later.

It gets a lot worse.

Then the condo association and the management company started to make a sad comedy of errors that I followed with great interest and great compassion for the owners from the safe confines of my new 2nd floor dream home on Marlborough Street.

First really big mistake was the management company and the condo association PREPAID the elevator company. The new elevators arrived but they were the wrong size. The elevator company blamed the management company which blamed the elevator company. Since the job was prepaid I bet you can guess who had to cough up the additional $95,000 to make the new elevators fit into the shafts.

So the people who bought my 3rd floor unit, after paying the $16,000 for the new elevators were asked for their portion of the $95,000 to retrofit the wrong size elevators into the building. Because the management company had prepaid, they didn’t have any choice, they had to pay even though the wrong measurement was done by the elevator company and the management company.

I sure am glad that I was out of the building at this point,
just the emotional anguish of these incompetent
irresponsible people costing me money!

But you want to hear the corker? It took them 3 more years to complete the elevator project. It must have been hell for the 4th, 5th, 6th and 7th floors as they had to walk up the stairs for a total of 4 years. So much for buying into an elevator building. In the end I think the new owners of my unit paid $22,000 for the elevators when all was done.

But you want to hear the bottom line? The condo fees for the 52 units went up by 50%. So my little 1 bedroom with 650 sq ft that had a condo fee of $350 when I bought it, now has a condo fee of $575. You can imagine how much much harder that makes these 52 units to sell now! Who wants to sign up for a $575 condo fee for a 1 bedroom when most condo fees for that size unit is about $350?

But you want to hear who is to blame? Besides the condo association trustees who apparently didn’t have enough business sense to keep from prepaying for a $500,000 elevator, thus forfeiting leverage to make the elevator company fix their mistake, the real blame goes to the management company who by the way doesn’t care.

So how do you avoid making the same mistake?

Investigate the management company. This can be as easy as talking with the trustees of several of the buildings that the management company has a contract with and ask them how happy they are with them. If you are a buyer and you are working with a Buyers Agent, he can be a big help here. Besides the fact that most of us Boston Buyers Agents already know the good management companies from the bad ones, your Buyers Agent can track down all the documents they don’t want you to see. The sellers don’t want you to see the meeting minutes and the budget and in a lot of cases you WILL NOT see these unless you or your Buyers Agent tracks them down. After repeated phone calls, I’ve even had to show up at the management companies’ door demanding I get a copy.

Property management is a difficult and very low profit margin business so they try to get a large number of buildings to make up for the tight margins with volume. Problem with that is, the more buildings they get the less they care about yours.

Looking for a good Buyers Agent? Call me, Jeff Persons ABR at 617-512-3443
Want to learn more about me?  Meet Jeff

More reading on Boston Condos:

5 Clues That Your Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
A Buyers Agents List of 5 Mission Critical Items to Check before Buying a Condo
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Return To WeSellBoston.Net

Your comments would be appreciated!

Don’t Just Investigate Your Boston Condo, Investigate The Management Company Too

When its time to inspect a home and sign a P&S agreement, I’ve noticed my buyers trying to figure out if they can get away without a real estate attorney. The answer is unequivocally NO! Its just too risky especially with Boston condos which come with a 3 inch stack of condo rules and regulations for the association you are buying into as well as a Master deed which is often over 100 pages.

Your real estate attorney reads all that and with their training can
spot some red flags that will cost you money down the line.

Without a real estate attorney you are wide open for problems. As an example, she will urge you to get title insurance which costs about $1500 and protects you if there are any legal problems somewhere in the past. Remember that many of these condos and single family homes have changed ownership dozens of times since 1880 to 1900 when most Back Bay, Beacon Hill, South End and Brookline buildings were constructed. If there is a problem somewhere down the line this Title insurance protects you from any claims on the property.

Whew! It would be a life warping event if you were to loose your home on a legal technicality. For instance, maybe someone in the 60’s sold the unit on false pretenses. If someone didn’t even have the right to sell the property they could come after you. Your Title insurance will protect you, your property and your money. $1500 well invested. Most people are open to doing things themselves to save money. Please believe me when I tell you this is not the place to pinch pennies.

Title insurance is just one example of sound advice from a real estate attorney. If you don’t have a lawyer it increases your chances of getting short changed in some manner. She actually READS that 3 inch stack looking for potential problems.

How do you find a good real estate attorney?

Most Buyers Agents like me keep a current list of qualified lawyers. This list contains information about the best we have worked with. These real estate attorneys know how to handle condos in the city as well as suburban single family homes.

Here is my current list of the best real estate
attorneys I have worked with.

Marisa S. Gregg, Esquire
Clark, Hunt & Embry
55 Cambridge Parkway
Cambridge, Massachusetts 02142
Tel: (617) 494-1920
Fax: (617) 494-1921
mgregg@chelaw.com       http://www.chelaw.com/

Laura E. Days, Esq.
Israel, Van Kooy & Days, LLC
1318 Beacon Street, Suite 19
Brookline, MA 02446
Tel. (617) 277-3774
Fax. (617) 277-6520
ldays@socialaw.com
http://www.ivkdlaw.com/

Joseph Rubinstein
Marsh, Moriarty, Ontell & Darcey
18 Tremont Street, Boston, MA 02108
Tel.617- 742-1822
Fax 617- 720-2565

Mark A. McCue
McCue & Lee, LLP
535 Boylston Street
Boston, MA 02116-3720
Tel.617-236-0212
Fax 617-236-0797

Sandra C. Steele
Hoffman & Hoffman
44 School St, 6th Fl. (Suite 610)
Boston, MA 02108
Tel.617-523-0666
Fax 617-523-6502

For more information call me at 617-512-3443, Jeff Persons ABR

Buyers Be Represented, Not Sold!

More Reading about Boston Real Estate:

5 Clues That Your Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

5 Worst Questions To Ask Your Buyers Agent

Return To WeSellBoston.Net

Can I Get Away Without Paying For a Real Estate Attorney?

Boston Real Estate buyers come to Boston from all over the world. The rules change almost everywhere you go. For instance in many European and Middle Eastern countries they often don’t use brokers at all, buyers preferring to work directly with the seller. Commissions for agents are as low as 1 percent while in Boston its 5 percent.  They don’t seem to think much of their agents and I have to believe that the agents are sparsely educated.

Here in Boston our brokers are well educated and carefully licensed with continuing education and mandatory ethics classes. The dichotomy we have set up between Buyers Agents and Sellers Agents was set up to protect the consumer. Its a checks and balances kind of regulation that keeps both sides honest.

Here are some things to keep in mind when
working with a Buyers Agent:

First,  if you are Relocating To Boston from out of town and want to get a Boston Buyers Agent to help you please remember that the Buyers Agent could spend a full work week  helping you and not get paid a penny.  Agents here don’t get paid unless there is a transaction. There are no salaries for real estate agents. So if after 2 weeks of having your buyers agent set up showings you change your mind, the agent just lost 2 weeks of his time and made no money.

As a Buyers Agent I have established some rules that buyers
must adhere to or I won’t even leave the office.

1. My first question to a buyer who has contacted me is “Is this a discretionary purchase?” Are they just thinking that it would be nice to have a place in Boston, especially if they have children in school here and plan to visit often? Or maybe they live in a rural area and think it would be nice to have a second home to visit the city. If the answer is yes, I get off the phone as soon as possible and continue looking for buyers who NEED TO BUY. You see, I’ve been doing this since 2002 and believe me buyers just don’t buy an expensive condo in an expensive city that they don’t NEED. By the time they figure that out and despite their good intentions, the Buyers Agent has lost several days or weeks. Then the Buyers Agent hears “Never mind, we will just use hotels when we visit”

2. Once its established you are really looking for a home and I start showing properties, I expect my buyers to show loyalty to our “gentleman’s agreement”. This simply means that if you go into an open house or a FSBO (for sale by owner) without me for some reason you sign in with my name so the Listing Agent knows you are being represented by me and they will refrain from trying to sell you some real estate. I don’t use Buyers Agency written agreements. I’m looking to my buyer to practice the Golden Rule. If my buyer is going to lie to me the piece of paper isn’t going to help anyone and who is going to sue? Not me.

3. Plan ahead. All showings in the city involve 2 brokers, the Listing Agent has to be there also. So if you have a list of MLS numbers you would like to see, give the agents 48 hours to set them up for you. Arrangements have to be made with tenants. Just setting up the showings for 15 properties will kill a good part of a Buyers Agent day on the phone.

Need to find the Best Exclusive Accredited Boston Buyers Agent?
Call me, Jeff Persons ABR at 617-512-3443

Buyers, Be Represented, Not Sold!

More articles by Jeff:

Relocating To Boston
5 Worst Questions To Ask Your Buyers Agent
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
5 Best Reasons To Have a Buyers Agent Represent You
5 Clues That Your Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Return To WeSellBoston.Net

How to Treat Your Boston Real Estate Buyers Agent? Use The Golden Rule

In case you didn’t have enough good reasons to seek out the services of an Accredited Buyers Agent, this secondhand smoking law suit in Boston makes the case for finding a really impeccable buyers agent. The buyers agent in this case didn’t lie, he just didn’t do his job, which left this poor woman in a condos upstairs from 2 smokers aggravating her asthma.

It started when this woman, Alyssa Burrage bought a condo in Boston’s South End. The woman has asthma and when she asked about the cigarette smoke smell the agent, who was supposed to be her buyers agent, told her all it needed was a paint job.

Alyssa Burrage

Would that be enough for you? Not enough of an explanation for me. I’ve been an Accredited Buyers Agent in Boston since 2002 and I would never stop my investigation with “It needs a paint job”.  If the woman has asthma its up to her Buyers Agent/Buyers ADVOCATE to look into it further. The guy who was posing as her buyers agent, like all brokers in Boston, knows that cigarette smoke rises and races right through these old townhouses built in the late 19th century.

In my building which is exactly like the one in question, if someone lights a cigarette in the basement it rises right through the building and I can smell it on the fourth floor in about 5 minutes. This happens in all these old buildings. Thats the reason we made ours a non-smoking building. We put a clause into the condo documents.

Alyssa’s agent knew this as anyone practicing real estate
in Boston for a number of years would.

Its so obvious! As an Accredited Buyers Agent, I would have started my investigation downstairs where the smokers live right away.  If Alyssa’s so called buyers agent was thinking about buying this unit for himself you can be sure that the downstairs smokers would have been dealt with or no sale.

Bottom line is even if someone calls himself your buyers agent, it doesn’t mean he really has your best interests at heart. In this case the pseudo-buyers agent just wanted to sell the woman some real estate.

Did he care about her asthma? In a word NO.

Not even enough to ask a couple of questions put to the smokers themselves? Not even enough to ask a few questions of the trustees? Not even enough to take a look at the condominium documents to see if there are any rules regarding smoking?

So why didn’t Alyssa’s buyers agent ask these questions?

The problem with all that objective investigation he could have done is that the answers might very well nix the sale which obviously was all this broker was interested in. I think he avoided lying but the negligence here is his lack of investigating the building and its occupants.

Sorry to report that a Suffolk County jury found in favor of the brokers. As it turns out after 4 years of this hassle Alyssa will receive no damages. She did get a small settlement from the smokers downstairs which is completely ridiculous because it wasn’t their fault. The fault lies with the buyers agent who sold the unit to Alyssa.

A lesson learned the hard way. Real Estate is always buyer beware around here but this case would never  have happened if Alyssa  had been diligent enough or lucky enough to meet a real Accredited Buyers Agent/Buyers Advocate who was sincerely interested in Alyssa, her asthma and the possibilities of her being happy in this property.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More articles by Jeff:

5 Clues That Your Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent

The Boston Real Estate Market Has NOT Experienced a Recession

Return to WeSellBoston.Net

This Secondhand Smoking Case in a Boston Condo is Another Good Reason to Have an Accredited Buyers Agent Represent You

Last year I wrote a post about the fear I noticed in the eyes of my foreign buyers when faced with making the decision to buy in the Boston area. “Frightened Looks on the Faces of My Foreign Buyers”.  The fear was that they may buy high and then suffer as the Boston real estate market craters. This post still rings true but the fear is being replaced with “Oh darn, we missed the bottom” in Boston real estate.

Jeff Persons ABR

As a Boston Buyers Agent I discovered that the other real estate brokers were avoiding foreign buyers and “Out-Of-Towners”. They said “too much work” and they were right. A full 90 percent of “Out-Of-Towners” (foreign buyers included) who are looking for a second home to be near their children or because they like the city, will in fact NOT buy a property. The reason most Boston real estate agents won’t work with them is that by the time the buyers figure out they don’t want to buy an expensive condo in an expensive city that they don’t really NEED, the agents have been run around town like rented mules.

Then you hear the buyer say “Uh…Never mind”, we think its better to just get a hotel room when we want to visit.

I’m looking for buyers who “need to” buy a Boston home.

These are the people who really need me. Working with “Out-Of-Towners” is more work but I find it very satisfying to help folks who know little about Boston. On my end I have to be diligent enough to make sure that this is not a discretionary purchase. This means eliminating the parents who are visiting their children and have some time to kill and want to look like a hero to the family. Also there are the buyers from the suburbs who are thinking about a place in the city. Very very few buyers actually do buy a place in the city just for kicks. Its not just the money, its all the other stuff that goes with owning a property.

Most people have enough to do without paying condo fees, taxes and dealing with all the other details and miscellaneous tasks that go along with ownership.

Once I have established that these buyers REALLY want or need to purchase a property in the Boston area, then I start to teach what I know about all the neighborhoods inside RT95-128. This is time consuming but fulfilling as it may help them sidestep living in a rental until they figure out where they should be within the enormous area we call Boston area real estate.

If I was moving to Paris or Amsterdam I would pray to meet someone like me. I save buyers tons of time and money. These folks arrive in Boston and right away I can eliminate 50 percent of the neighborhoods and 50 percent of the MLS numbers that caught their eye on the web. Some want to be as close to Back Bay, Beacon Hill or the South End as they can afford, these are the best areas of downtown Boston. If they have young children, maybe they want a 3 bedroom in Lexington , Newton or Brookline as these have the best schools in the WORLD and a buyer can find a back yard too. Conversely, some parents with small children want to be downtown, the heck with the back yard, no one wants to mow the lawn. The suburbs are a boring hell-realm for some parents.

Excuse the hubris but I think most buyers believe that someone like me has to be too good to be true. Many also believe that they should  go through the expense of renting for a year and moving twice so they can figure out the city for themselves. Well, maybe they should or maybe not. Who am I to say they shouldn’t? However, if you take the time to read the other posts on this site, and check out our Relocating To Boston page, I think you will begin to realize that you don’t have to rent for a year, you just need a good Buyers Agent/Buyers Advocate to help you navigate Boston real estate. Please feel free to contact me so we can discuss your search for a Boston home.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

Read related posts:

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
How to Save Time on Your Home Search by Closely Reading Public Information Sheets
First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent
The Boston Real Estate Market Has NOT Experienced a Recession

Return To WeSellBoston.Net

How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs

1. He does not have his ABR (Accredited Buyers Representative) certification.

If he has bothered to get his certification it tells me he is serious about helping buyers.

2. She does not eagerly and enthusiastically show you EVERYTHING.

A good Buyers Agent will make sure you see all the viable properties in your price range and neighborhoods.

3. He starts to echo the Seller Agents justification for the price.

Hearing some acknowledgment of the negatives about the property is very reassuring. There are shortcomings for every property, if he glosses over those you know you have a Sellers Agent in a brilliant disguise.

4. She represents sellers.

An exclusive Buyers Agent may be hard to find in some locations but if you can find a Buyers Agent who NEVER represents sellers its a good indication that you have a real good money saving helper on your side.

5. He shows an unwillingness to walk away.

If he works the deal like a dog with a bone, asks you to pay more or makes “follow up” phone calls to you then you do not have a Buyers Agent, you have another person trying to sell you some real estate.

Here are some tips on finding a really helpful Buyers Agent and what you should expect from them.

1. Do Not Be Lazy!

I’m having fun here but the point is that I think many buyers do not seek out the services of a Buyers Agent because it looks like more work up front as well as an invasion of privacy.

2. Use Your Intuition.

Ask lots of questions and read their blog if they have one. Look into their philosophy because If you can find a Buyers Agent you trust it can save you 10s of thousands. This must be worth doing the same rigorous interview you would have with anyone handling responsibility like your new lawyer? Have the same reservations you might have when buying a used car.

3. Tell Him You Want To See ALL the sold units.

Dishonest Buyers Agents will hand pick sold statistics to reinforce the sellers ideas about the value of the property. Don’t settle for just the sold units that agree with the asking price.

Buyers Agency When Done Correctly is an Alignment With Truth.

A Buyers Agent who is REALLY practicing Buyers Agency will keep you from getting burned. He or she will pull several sets of sold property statistics. The first is done in preparation of the offer. After the offer is submitted another set coming from a different direction with the numbers can reinforce the offer, warn the buyer not to go higher or in some cases point out that the property is actually underpriced. (It happens but its always a mistake made by the people pulling the statistics.) Then when the counter offer comes in another set of metrics is pulled from yet another set of numbers. By this point a Buyers Agent worth his salt can nail down the fair market value of the property to within 3 percent. And more importantly YOU will know the value of the property. Hopefully you saw the inventory so you learned a lot about value there. Now in addition, thanks to your Buyers Agent, you have looked at 3 sets of averages statistically nailing down fair market value for you.

A good Buyers Agent comes back to the statistics again and again. The whole idea of practicing impeccable Buyers Agency is to take out personal opinion and conjecture. Numbers don’t lie and if the numbers are wrong the property is overpriced, period. You will find out if you have a real Buyers Agent if she starts to reconcile the sellers numbers to bring the deal together (read, when you pay more). Thus this kind of brilliantly disguised Listing Agent is along for the ride and the commission. She won’t pull another set of numbers to counter all the anecdotal hype that just streams out of the Listing Agents mouth. She is content to let the Listing Agent sell some real estate to her buyer client. Bad form, absolutely dishonest.

These commission rebates are another joke on the consumers. Mention cash rebates to consumers and its cash for clunkers all over again. People are suckers for a cash kickback especially in the middle of a deep recession. I would not be surprised if Massachusetts and other states eventually outlaw this practice because it plays on the buyers greed. Its so transparently manipulative and a little sad. There are all these buyers tripping over themselves to get a cash rebate while attention is taken away from the actual price being paid for the house (kind of like the $8000 tax break). In other words they are looking at the short term while a good Buyers Agent can get the price reduced. If I can get you the home for 500K instead of 530K, you just saved $180 per month for the next 30 years. That comes to $64,000 over the life of the loan. So the $64,000 question is :

How does that cash rebate look now?

I’m also not surprised to see this happening during a recession. Funny how desperation can get buyers to fall for that. Now people, work with me and think about it, not only are you are not going to use a real ABR Buyers Agent, you want to be rebated his commission and yet you expect to get a good deal from the seller? Are we living on the same planet? You may get the rebate but you will get taken to the cleaners for the property. Penny wise, and dollar totally foolish. What kind of magnanimous seller is going to give you a good deal when you are not even bothering to be represented?

In conclusion I would like to say that if there is a downside to having a Buyers Agent represent you, I can’t imagine what that might be. Here is a list of advantages once you have found a Buyers Agent. Just Google “Boston Buyers Agent” or “Boston Area Buyers Agent”

1. He will arrange and facilitate the actual property showings.

2. He will make the process of seeing the inventory easier for you.

With less running around to look at properties. See my article entitled ” Tips For Your Boston Home Search, Save Time and Frustration by Closely Reading MLS Listing Sheets” . If you have a list of 20 properties you would like to see, your Buyers Agent can help you cut that list in half without leaving the office. So right away your viewings are cut in half.

3. There is no charge for a Buyers Agents services.

He is paid entirely by the seller. So you get all that help seeing the properties, help with establishing fair market value as well as preparing the offer and negotiating price and terms. On top of all this saving time and money, this whole process can and should be a lot of fun!

Looking for the best Buyers Agent in the Boston and Boston Suburb areas?
Call me today and we can discuss your search.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More articles by Jeff:

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

5 Best Reasons To Have A Buyers Agent Represent You

5 Worst Questions to Ask Your Buyers Agent

The Boston Real Estate Market Has NOT Experienced a Recession

Return To WeSellBoston.Net

5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

I love this coming from Rich at the Boston Real Estate Observer!

HUD Encourages Use Of Exclusive Buyer Agents

In its first revision to its home loan booklet in more than 10 years, the US Department of Housing and Urban Development (HUD) advises home buyers that it is their responsibility to search for a real estate agent that will represent their interests.

I love this because other consumer protection oriented organizations will probably follow suit.

It has always mystified me that more people don’t use Buyers Agents. I’ve gone back and forth with the question and I even wrote about it here Relocating To Boston, Why Dont More Buyers Use a Buyers Agent? It just doesn’t make sense.

I guess the list would go like this in order of probability:

• Laziness
• Desire for privacy
• Fear of being sold to or at
• Buyers Agency hasn’t been practiced long enough in Mass to be on buyer’s “Musts Have Lists”
• The population got so used to everyone representing the seller, they think Buyers Agency is a ruse anyway.
• They just don’t believe that a Buyers Agent would REALLY have their best interest at heart

Things have changed, Buyers Agency is being practiced in Massachusetts now and it is empowering buyers and saving them time and money. There is so much that a good Buyers Agent does for the consumer, I don’t know where to start.

I find myself using the term Buyers Advocate often. Because in its very purest essence there is detachment from a profitable outcome of the transaction. Its contrary to the actual definition of Buyers Agency to do something self serving like pushing a deal through and not disclosing certain deal breaking details.

In addition to making sure everything about a real estate transaction goes well, a Buyers Agent does a bang-up job of showing ALL the appropriate inventory. As difficult as that may be it is also in the definition! How could you not show  properties when you yourself would never buy without first seeing those properties. Sellers Agents won’t do that, they have their own inventory to market.

The next statistics really made my heart sing because I knew it was true but I didn’t know how to quantify it.

If you need ANOTHER reason to be working with a Buyers Agent, this should get your attention. Additionally, a survey conducted by the National Association of Exclusive Buyers Agents (NAEBA) found that among survey respondents, there were only 15 foreclosures out of 1,849 closings. That represents a foreclosure rate of just 0.8 percent, compared to the nationwide rate of 1.84 percent (more than double) in 2008.

This last bit of information I was expecting and waiting for as I think that other Buyers Agents like myself end up talking buyers down from spending too much. I am always urging people to underspend and buy as few square feet as possible especially in the city. And of course this leads to greater property appreciation. Working with an exclusive buyer agent offers more than a dedicated representative. Data validates that buyers actually get better results. An exclusive buyer agent promises to work toward a better price and terms for buyers. A study conducted by Chandler & Chandler confirms that property purchased through an alliance with an exclusive buyer agent shows a 67 percent greater appreciation in value.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

More articles by Jeff:

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney
5 Best Reasons To Have a Buyers Agent Represent You
5 Worst Questions To Ask Your Buyers Agent
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

Moving to Boston? Check out my Boston Relocation page

Return to WeSellBoston.Net

First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent

Some grade school math coming from a few different directions and a feel for the ineffable, here is how I can tell my buyers how much the home is REALLY worth.

Step 1. I Establish a price range based on price per square  foot.

Here is where I differ from many other agents. I start with price per square foot from a few different directions and a few different averages. If I have a rear 2nd floor 2 bedroom on a certain block of Back Bay or a single family on a certain street in Lexington or a condo in a large building in Quincy there are a myriad of ways to quantify.

For example, lets say I have an average renovation of a third floor one bedroom front facing on Commonwealth Avenue. I’m looking for three averages. One would of course be all third floor front facing Commonwealth Avenue condos sold in the last 12 months or so. For the second average I will pull up all one bedrooms that have the same location cache’, like front facing on Marlborough, Beacon or the side streets of Back Bay proper. For the third average I will pull up raw numbers for square footage in Back Bay that match the renovation level of the property in question. If parking is involved I add or subtract depending  if the unit has it and which block the parking is on. If its near Exeter and Commonwealth the parking is worth 100-150K. If its up near Charlesgate it may be worth 75K only 4 or 5 blocks away.

So now I  take an average of those three averages and I have a good starting number.

Step 2. A bit more subjective.

The next step tends to expand the range of values because some of these issues are ineffable and tough to quantify. So much so that I discuss these with my client. How much is that great view worth? Who says you can’t put a number on it. Take a stab at it. After all my buyers have seen the entire inventory if they are following my direction (as a Buyers Agent one of my basic rules is to show EVERYTHING appropriate) so they can probably tell me what they think of the view and we find agreement at say $50 per square foot above the average we established in step1. With me so far?

Step 3. The other ineffables.

Once I have looked CLOSELY AT THE PHOTOS and I’m done READING THE REMARKS of the sold units here are the other modifiers to the number established in Step 1 and Step 2.

• Condition of Common Areas
• How well the entire building as well as the unit does during inspection
• Cost of ownership, this includes condos fees and taxes which can both be too high for many reasons

All of the above is going to take me 30 minutes but now I can give my buyer a close range of fair market value. So as in the case of the front facing 1 bedroom on Commonwealth Avenue my range may be stated like 420K to 440K. Once the negotiations get below 440K I can relax a bit as there is no danger of my buyer overpaying for the property. If the seller doesn’t go low enough, I will often advise my buyer to walk away because as we all know “You don’t make money in real estate when you sell, you make money in real estate when you BUY.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

Thanks, your comments will be appreciated!

More articles by Jeff:

A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

How to Get the Lowest Prices on Real Estate by Buying in the Winter

Negotiating The Price of Your Boston Home – Stick To The Numbers

Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Return To WeSellBoston.Net

Boston Homes, Establishing Fair Market Value

It has always puzzled me that so many buyers don’t use a Buyers Agent.

I’ve been going over possible reasons in my mind. What are buyers thinking? An advisor and representative to work for you at no charge? Why would anyone say no to that?

I’ve heard it said that buyers think they will get a better deal without their own Buyers Agent.

OH Boy!  Those sellers love to see you show up unrepresented.

Even if they actually did give you a good deal, how would you know? Is Zillow’s algorithm going to tell what the home is really worth? I don’t think so. Zillow is a computer and needs a human brain to interpret the results and add anecdotal knowledge.

Example: I entered a 2 bedroom at 75 Clarendon Street into Zillow and it gave me a fair market value of 750K. Zillow however doesn’t know about the auctions at the Bryant across the street and the possibility of the 1.5M square foot Columbus Center project giving them construction across the street for the next 3 years. These and other considerations helped me arrive at the fair market value of 550K for that same property Zillow says is worth 750K. So if you walk in to an open house at 75 Clarendon Street be prepared to be told that Zillow has the property priced 200K too high.

Zillow doesn’t add the possibilities so as a do-it-yourself tool it makes a better parlor trick.

Privacy

I think many buyers feel insecure and would prefer to look at properties alone. An agent will invade their privacy, eventually knowing all about them and their finances. They say men especially don’t like asking directions and therefore want the autonomy of looking without representation. Whatever the reason, from embarrassment about finances or fear of being “sold” some real estate, you will pay a higher price if you deal directly with sellers or listing agents.

Buyers Are Suspicious

I don’t think buyers really get what a good Buyers Agent can do for them. They just can’t get that their Buyers Agent is not there to SELL them some real estate. Buyers Agency in its purist form detaches from the outcome and will urge the buyer to walk away if the price and terms are not what they should be. This is real news to many and many will not believe it anyway. To most it must sound too good to be true.

Here is a list of things you probably WILL NOT GET without a Buyers Agent.

• A real statistically correct statement of fair market value, rigorously arrived at with a quantitative approach minus personal opinion or conjecture.

• Someone with you who is accustomed to looking for potential buyers problems. A good Buyers Agent will help keep the cost of ownership down for at least the first five years.

• A counter point to the non-stop monologue of positive features of the property that streams endlessly out of the sellers agents mouth.

• A Buyers Agent will track down the minutes to condo meetings. These are hard to get because no one has a vested interest in you getting to read them. This is critical because the condo association may not have any current assessments which they are required by law to disclose to you. If you read the minutes you may find out about other very expensive projects for the near future. They don’t have to tell you and they won’t tell you so getting the minutes may inform you that the building is going to need a new this or that soon.

• Help with your search results. I can usually eliminate 50% of the MLS numbers that visiting buyers send me and explain why I have eliminated them. This saves 50% of their time running around looking at the wrong properties. Typically when a buyer relocates to Boston they go through the do-it-yourself process of looking at listing sheets online. This is great but keep in mind that ALL listing sheets whether they are on the kitchen table or on the internet were written by agents of the seller and are missing anything the seller wishes withheld from you.

• Recommendations of the best home inspectors and lawyers who are geared toward protecting buyers. Sellers agents cannot do this under current agency law.

So basically I think that there are so few really good Buyers Agents around that most folks don’t believe that a Buyers agent will truly have their best interests at heart. I can see it in their faces when I tell them there is a noise transference problem between there unit and the next, or that the owners have neglected the building. Their jaws drop when I level some bad news about certain condo associations or a property management company. But each time I volunteer some deal killer information that I could have kept to myself, I can tell my observations gather more and more weight with them.

Written by RE/MAX Destiny Accredited Buyers Agent Jeff Persons 617-512-3443

What Do You Think?  Your Comments Will Be Appreciated!

Relocating to a Boston Suburb Home?

More articles by Jeff:
How I Help “Out-Of-Towners” Find Their Spot Within Boston Real Estate and Boston Suburbs
Dont Just Investigate Your Boston Condo, Investigate The Management Company Too
The Boston Real Estate Market Has NOT Experienced a Recession
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.

Return To WeSellBoston.Net

Relocating To Boston, Why Don’t More Buyers Use a Buyers Agent To Save Time and Money?

My buyer and I had been looking sporadically for a few years so we knew the condo market in Bostons Back Bay and Bostons South End in the 700K to 800K price range. We found this really inviting 2 bedroom 2 bath condo right on the edge of the Southwest corridor that separates Bostons Back Bay and Bostons South End.
Once in a while I find a place that would suit me personally just fine and I could move right in and feel at home. This feeling transcends price, its ineffable, the place just feels like home. This condominium is one of those I really like. Check out my first ever video and I will walk you through. Please excuse the amateur video.

Written by Jeff Persons ABR 617-512-3443

More Articles Written by Jeff Persons:

5 Worst Questions To Ask Your Buyers Agent
Can I Get Away Without Paying For a Real Estate Attorney?
5 Clues That Your Boston Real Estate Buyers Agent is a Sellers Agent in a Brilliant Disguise.
A 20 Year Resident of Bostons Back Bay Tells Why He Likes Brookline MA So Much
First Thing to Do When You Start Your Boston Real Estate Search, Get An Exclusive Accredited Buyers Agent

Thats right, by the time it feels OK to buy a Boston Condo or a Boston Home (most of which are condos) you have missed the bottom. Its not easy to make money in real estate. You make money in real estate when you buy, not when you sell. So you have to buy right and that means its going to feel risky.

When I was a stock trader we used to say “You gotta buy them when they hate them”. In other words buy stocks and real estate when everyone else is terrified. This risk is what you get paid for in the end.

I have an anecdote, I know a teacher who bought a Commonwealth Avenue building in 1973 for 165K. At the time he was making $12,000 per year and he confessed to being scared to death that the tenants wouldn’t pay their rent. Now if you remember 1973, there was nothing reassuring about the economy. We were in recession, we had gas lines and unemployment was high. So he bought this building in the middle of a bad economy with an energy crisis going on.

This building is now worth $5,000,000+

Opportunity for making money in real estate comes disguised as risk.

Another anecdote, I have  friend who bought a home in Chestnut Hill Newton in 1980 for 200K. Again this guy was nervous as this seemed like a high price for the property at the time. He swallowed his fear and bought anyway.

Three years ago he sold his Chestnut Hill home for 2.4 Million.

There are no guarantees but the successful real estate investors feel the fear and buy it anyway.They deserve to make the money because the had the courage to invest during the bleakest times.

Is Now The Best Time?

If that was easy to answer where would the risk be? Most folks wait until we have consensus and will pay more than when the market is at its lowest. If most buyers thought this is the best time to buy we would have bidding wars going on. I am very careful about making market predictions and I won’t make one now. Those who have been reading this blog know that my years in the stock market cured me of that particular ego trip.

Written by Jeff Persons ABR 617-512-3443

What do you think?
Your comments would be appreciated!

More Articles by Jeff Persons ABR:
What is the Stock Market Telling Us About the Real Estate Market?
How to Get the Lowest Prices on Real Estate by Buying in the Winter
Forget The Boston Real Estate Market, Buy The Boston Home You Can Live With
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo

Return To WeSellBoston.Net

If You Wait For The All Clear Signal To Buy Your Boston Home You Missed the Bottom of the Boston Real Estate Market by About Six Months

Find a good Buyers Agent and you can save 10s of thousands on your Boston Home

Keep in mind that there are Buyers Agents and there are Buyers Agents. The Buyers Agents I’m talking about are not just a Listing Agent in a brilliant disguise. Part of the disguise may be that the Listing Agent has their ABR (Accredited Buyers Agent) certification. Don’t let that fool you. I have my ABR but in my hands that certification has helped my buyers save millions since I started in 2002.

You see the classic way to build a real estate business is to first get listings. After that if these listing agents have nothing else to do, they tell the buyers who come to their open houses that they are Buyers Agents and wouldn’t you just love to go out with me and look at properties. “You will get a good deal with me and I know about properties that are not on MLS etc.” They bill themselves as “Buyers Agents” maybe they even have their ABR but at the offer stage you will hear them start to echo the sales pitch of the Listing Agent anyway. So who needs 2 Listing Agents pulling at you to pay up the price the seller wants, basically trying to sell you some real estate.

I also think that the folks who say that a Buyers Agent isn’t needed are just being lazy. They want it to be as easy as paying what the Listing Agent suggests and be done with it. It would be so nice if all we had to do is find the properties on the internet and go directly to the pocket picking Listing Agent. This lacks rigor and these buyers will overpay. What they don’t understand is that this whole two-sidedness, this whole dichotomy has been built into the system to protect them from getting fleeced.

These commission rebates are another joke on the consumers. I wouldn’t be surprised if Massachusetts and other states outlaw the practice. I’m also not surprised to see this happening during a recession. Funny how desperation can get buyers to fall for that. Now people, work with me and think about it, you are not going to use a Buyers Agent, you want to be rebated his commission and yet you expect to get a good deal from the seller? Are we living on the same planet? You may get the rebate but you will get taken to the cleaners for the property. Penny wise, and dollar totally foolish. What kind of magnanimous seller is going to give you a good deal when you are not even bothering to be represented?

So What does a REAL Buyers Agent Do?

A Buyers Agent who is REALLY practicing Buyers Agency will keep you from getting burned. He or she will pull several sets of comparables. The first is done in preparation of the offer. After the offer is submitted another set coming from a different direction with the numbers can reinforce the offer, warn the buyer not to go higher or in some cases point out that the property is actually underpriced. (It happens but its always a mistake made by the people pulling the comparables.) Then when the counter offer comes in another set of metrics is pulled from yet another set of numbers. By this point a Buyers Agent worth his salt can nail down the fair market value of the property to within 3 to 5 percent. And more importantly YOU will know the value of the property. Hopefully you saw the inventory (A good Buyers Agent will make sure you see EVERYTHING viable in your price range and neighborhoods) so you know a bit about value there. Now in addition, thanks to your Buyers agent, you have looked at 3 sets of averages statistically nailing down fair market value for you.

Buyers Agency when done correctly is an alignment with truth.

That’s why a good Buyers Agent comes back to the statistics again and again. Numbers don’t lie and if the numbers are wrong the property is overpriced, period. You will find out if you have a real “Buyers Agent” if she starts to reconcile the seller’s numbers to bring the deal together (read, getting you to pay more). Thus the brilliantly disguised listing agent is along for the ride and the commission. She won’t pull another set of numbers to counter all the anecdotal hype that just streams out of the Listing Agents mouth. She is content to let the Listing Agent sell some real estate to her client. Bad form, absolutely dishonest.

The whole idea is to take out personal opinion and conjecture. Listing agents will go on with anecdotal evidence and actually search the MLS looking for overpriced sold units to justify the seller’s asking price.

So how can you tell if the Buyers Agent you are talking to is for real?

The best thing would be to find a buyers agent who NEVER represents a seller. I’ve been an ABR since 2004 and I don’t take listings at all because I want to keep my focus on buyers issues. This costs me about 30% of my income but its worth it. I can hold my head high and refuse to participate in the sham. Every buyer I work for gets my best.

Also, use your intuition, ask lots of questions and read their blog if they have one. Look into their philosophy because If you can find a Buyers Agent you trust it can save you 10s of thousands. Isn’t that worth doing the same rigorous interview you would have with anyone handling responsibility like your new lawyer? Have the same reservations you might have for a used car salesman. Unfortunately many Buyers Agents talk a good game so be prepared for him to talk the Listing Agent’s talk once that first offer is submitted. Tell him you want to see ALL the sold units, not just the sold units that agree with the asking price. Dishonest Buyers Agents will hand pick sold statistics to reinforce the seller’s ideas about the “value” of the property.
Written by Jeff Persons ABR 617-512-3443

Read more about Buyers Agency: Real Estate Cafe -  Smart Money -  Real Estate Snippets -  Szerlip -  Sold On Sunday

Your comments will be appreciated!

More Reading by Jeff PersonsABR:
5 Worst Questions To Ask Your Buyers Agent
A Buyers Agent List of 5 Mission Critical Items to Check Before Buying a Condo
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Dont Just Investigate Your Boston Condo, Investigate The Management Company Too

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Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Submitting your offer for the property for the first time.

Some work should be done before you start the price negotiation. First of all, ignore the asking, that’s probably a wild-ass guess anyway compared to what you and your trusted Buyers Agent can tell you. Ask your Buyers Agent to pull up ALL the sold units in the area whether they compare or not. From this list you can start to take some averages to establish the fair market value of the property.

Don’t believe anyone, go back to the numbers.

After your initial offer, maybe you get a yes but if you don’t maybe you get a counter offer. In either case its time to go back to the numbers. Keep in mind that after that first offer and counter, everyone has an “opinion” as well as an agenda. The listing agent thinks one price, the seller another. If I add our side, that’s 4 opinions. Throw them all out and come back to the sold units.

Come Back To The Numbers

This is where you find objectivity and no one has to be wrong.

During a negotiation egos start to get involved and no one wants to be “wrong” and by simply scrutinizing numbers we shouldn’t make anyone wrong. Mission critical here is not that you get the property but that you get it without overpaying.

If you take more averages you and your Buyers Agent can come at the valuation in a few different ways. Every time you do this during a negotiation you and the seller get a clearer idea of what the property is worth.

Numbers Dont Lie

Personal opinion and conjecture disappear in the face of quantitative analysis.

After you have all the solds in the neighborhood, you and your Buyers Agent can find at least 3 different ways to take meaningful averages from these. Each time you do you are automatically reassured because you have seen enough price points to intuitively know what the property is really worth.

You may or may not get agreement on price and terms but you will be assured that you will not overpay for the property. As hard as it is to see that “perfect” property go, at least you won’t spend the next 5 years trying to figure out how to get your money back out of the property.
Written by Jeff Persons ABR 617-512-3443

Your comments will be appreciated!

More reading by Jeff Persons ABR:

How to Get the Lowest Prices on Real Estate by Buying in the Winter
What is the Stock Market Telling Us About the Real Estate Market?
Free Real Estate Commissions! Sound Too Good To Be True? It Is.
Buying Boston Real Estate Without a Buyers Agent is Like Going Into Court Without An Attorney

Return To WeSellBoston.Net

Negotiating The Price of Your Boston Home – Stick To The Numbers