Archive for 2011

10 Oct
Pink Tea
Posted On : 10 10th, 2011   By : Alice  |  Real Estate

I attended the third annual Pink Tea this past Thursday, it was definitely a treat! Every year I learn something new, and this year I learned about all of the new technology that has recently come out regarding breast screening.

I also usually learn about just one or two things that all of us can add to our daily routine to decrease our chances of having breast cancer. This year, I learned that we should add daily servings of blueberries and spinach to our diet.

Additionally, there is also a speaker each year, and this year’s speaker was definitely inspiring. She was a two time cancer survivor, and reminded all of us that we are stronger than we realize.

Of course, the mini sandwiches and treats were delicious as well!

10 Oct
Fall 2011 Activities
Posted On : 10 10th, 2011   By : Alice  |  Events, Real Estate

I just adore the fall season! There are so many fun activities unique to the Naperville area. Here are just a few to consider participating in:

Greater Chicago Soap Box Derby Association Race
October 15 & 16th, 2011 (Sunday)
9 a.m.-5 p.m.

Racing this year will take place at the corner of Diehl and Frontenac Road in Naperville. Spectators are welcome to watch the exciting race! Kids who are contestants can stop by for a free test run on either day. Contestants should be from age 8-17. If a child does not have a car to race, but would still like to compete in the race, they can call ahead to reserve a car at 630.841.8832.

Soup’s On!
October 16th, 2011 (Sunday)
11:30 a.m.- 5 p.m.

This yearly event is sponsored by Rotary Club of Naperville and will be held at 1415 W. Diehl Road in the Tellabs Atrium. It benefits three of the local food pantries/shelters. The event offers great entertainment and food. The cost for adults is $45, tickets for seniors (over age 65) and military are $35, tickets for children ages 6-15 are $10 and children under the age of 6 are admitted for free.

Naperville Farmer’s Market
October 15th, 22nd, 29th
7 a.m.- 12 noon

Remember, October is the last month for the Naperville Farmer’s Market! It is open every Saturday and runs through the last Saturday in October. It is held at the Fifth Avenue Station parking lot, at 200 E. 5th Avenue.

Trick or Treat in Downtown Naperville
October 30th, 2011
11 a.m.- 2 p.m.

Trick or Treat at various shops and restaurants in downtown Naperville! All participating businesses will have Halloween balloons displayed outside their shop/store. The Naperville Trolley will also be providing trolley rides during this time.

13 Sep
Appraisal Values – A Common Challenge
Posted On : 09 13th, 2011   By : Alice  |  Appraisals, Real Estate

Home CalculationAs many of you know, it is currently a very challenging market to sell your home in. There is a lot of competition listed on the market and many properties (including foreclosure and short sales) that are priced aggressively to sell. The main challenge that I discuss with many of my sellers is not whether or not we will be able to get a buyer to purchase their home, but more importantly, if the property will appraise out to the purchase price.

Oftentimes, as a listing agent, I am actually able to get slightly higher price for my seller, but then the appraisal comes back short. For example, I had a luxury townhome listing that I put on the market earlier this year. When I originally met with the seller, I had suggested that we list at $399k, based on other properties that had closed within the past 3-6 months. I also discussed with the seller that we would probably not receive an offer higher than $360k-$370k range. The seller wanted to list the home at $429k. We made a couple of price reductions, and had an offer within 90 days. However, when the appraisal was conducted, the value came back at $346k. Even though I was able to obtain a sales price of close to $400k, the appraisal came back over $50k short!

The appraiser had looked at all closed comparables in the subdivision, and the most recent closed comparable was below $300k. As a listing agent, I am always present at all appraisals. For this particular one, I had presented to the appraiser information regarding the difference in square footage between the two properties, the location difference (the property that closed at below $300k faced a laundry cleaner), and even provided the appraiser with information directly from the original builder to prove that the subject property was worth a lot more than $346k. However, even after all of this information, the appraiser would not budge on value.

Ultimately, my client had a difficult decision to make: to take the offer of $346k, or to cancel the contract and wait for the market to change (which according to economists, will take at least 3-4 years).

This example is the classic case of the parameters we must work within, in today’s real estate market. Appraisers will only include properties within a 2 mile radius of the home, and only look at closed comparables within the past 3-6 months. Therefore, even if you are a seller who is lucky enough to receive an attractive offer price for your home, it may not appraise out.

The lesson from all of this is very clear- if you are going to sell your home in this market, price it right and aggressively from the first day. Most importantly, whether we like it or not, we must price it based on other homes that have closed within your subdivision or sub-market area within the past 3-6 months.

22 Jul
Dodd-Frank Act: Proposal to Increase Mortgage Down Payments
Posted On : 07 22nd, 2011   By : Alice  |  Dodd-Frank, Real Estate

From my conversations with buyers and sellers these past few months, it has become apparent to me that most of my clients are not aware of the Dodd-Frank Act that became law in July of 2010. Even more important, I have realized that most of them are also not aware of the current proposal to increase the required mortgage down payment to 20%.

Under the Dodd-Frank Act, financial institutions that securitize mortgage loans are required to keep at least 5% of the loans that they approve. However, if the mortgage is a qualified residential mortgage (QRM), then it is exempt from this requirement.

Due to the Dodd-Frank Act, federal banking regulators have released a proposal that will define and create QRMs. The proposal would include a requirement of all mortgages to be at a 80% loan to value, which would require a 20% down payment. The proposal would also limit the total mortgage payment to 28% of the borrower’s income and limit all debt to 36%.

From the perspective of financial institutions, they will want to minimize the percentage of loans that they retain. Therefore, if the act is passed, they will definitely increase down payment requirements across the board. Currently, borrowers have many other options for mortgage loans, including FHA loans (with a 3.5% down payment requirement), and 5-15% down payment conventional loans. If this act is passed, it will restrict the qualified borrower pool even further, and this will certainly be a detriment to the already fragile real estate market.

Since it was becoming more evident to me that most of my clients were not aware of this proposal, I wanted to shed some light on this topic. Voting on this act is currently set for August 1st, 2011. I strongly urge you to contact your local legislator as soon as possible, to let them know how this act will negatively impact the real estate market. A 20% down payment requirement on mortgages will price a large group of buyers out of the buyer pool. This will directly impact the number of homes being sold, and increase the already high level of inventory of homes currently on the market.

If you are a seller who has their home currently on the market, you should be aware of this proposed act, because it will directly impact your chances of selling your home quickly. If you are a buyer who is currently actively looking to purchase a home, you should be aware of this proposed act, as it will directly impact your buying power.

Feel free to contact me with any questions regarding the proposed act.