Massachusetts Home Buyer Guide

More Multi-property Auction Woes

Others misfortune has created opportunity for potential home buyers, but buying a home at a multi-property auction has been difficult, if not impossible, in Massachusetts.

The Boston Globe reported May 14, 2008 that another winning bidder, Alexandria MacKinnon, on an allegedly foreclosed Massachusetts home auctioned by Real Estate Disposition Corp. has found she can't close on the home because the foreclosure process is not yet complete.

After a March auction, Real Estate Disposition Corp. told MacKinnon and her husband to prepare for a closing by May 8, 2008, so the couple gave notice to their landlord and went through the process of qualifing for a home loan. Then the closing was postponed indefinitely because the mortgage company that was working for the buyers told them it couldn't make the loan because the seller did not yet own the home.

"Real Estate Disposition was warned by state regulators before the March auction against including any properties it did not have the right to sell. The company has said it auctioned several such properties at a previous event in November."

Buyers are faced with a great deal of frustration when dealing with banks and the companies that represent them. Buyers also make the mistake of attempting to complete the process without professional representation.

Read The Boston Globe Article

2008 May Be The Year To Buy A Home

Wellesley College professor Karl Case is a nationally-recognized expert on the housing market.

He might be best known for predicating the decline of the housing market a few years back when others thought the market had more growth ahead. Well, Case is speaking out again, and I have some good news and some bad news.

First the bad news: If you were hoping for the market to decline another 10-20 percent over the next 18 months, you may be greatly disappointed.

The good news: You probably can stop procrastinating about buying a home. The deals aren't likely to be any better in 2009.

Case believes there are "strong signs of a possible [housing] rebound," the Boston Herald reported May 9, 2008. His optimism is based on a key economic indicator: housing starts.

Case said the decline in housing starts nationally reached an important threshold last month, dropping below the one million mark.

"Over the past 30 years, this has signaled the end of a real estate market downturn. Housing construction rebounded sharply in the ’70s, ’80s and ’90s after reaching this low point, Case said."

The Greater Boston Area may even rebound sooner.

"While prices rocketed locally during the recent real estate boom, the Boston area did not see the orgy of construction that flooded markets like Florida and Nevada with new homes."

Not everyone agrees with Case. Even his business partner, Yale economist Robert Shiller, disagrees. Case and Shiller put together the Standard & Poor/Case-Shiller housing index.

What I found interesting is the lack of coverage regarding Case's prediction. I was interested in finding more news coverage about Case's  beliefs, but I could not find one. Most of the media clearly isn't interested in reporting good news about the housing market.

Read The Boston Herald Article

Interactive MBTA Map

The Massachusetts Bay Transportation Authority (MBTA) has an interactive map on it Web site that provides train schedules, stops and more.

Low Prices, Great Rates Attract Buyers

An article by Reuters news service April 15, 2008 discusses the feeling among real estate professionals that potential home buyers appear to be ready to take advantage of lower home prices and attractive mortgage interest rates.

"It's too early to talk of a trend, but lower house prices and mortgage rates are bringing buyers out of hibernation, at least in some markets. Provided sellers are prepared to cut prices, buyers are willing to bid, real estate agents say."

My business partner and I certainly have seen this trend over the past couple of months. We're as busy as we have been any time over the past two years showing homes to potential buyers.

Many home buyers also are interested in learning more about foreclosed properties.

I'm don't expect home sales or home prices to start to increase anytime soon, but we might be nearing the end of the declines. Stay tuned.

Read The Reuters Article

Consider The Costs Of Buying / Owning A Home

An April 10, 2008 post on Bankaholic discussed the various costs of buying and owning a home, and how one should carefully budget for such a major financial event.

The post contains simple, but sound, advice, such as the following.

"A good question to ask yourself before contacting your local banker to discuss a loan is, ‘how much is too much?’ While you might be tempted to try and get as much money as possible if you can find a good rate, you do not want to make the mistake of taking on a loan so big that your finances will be stretched to the point that you cannot make your payments."

Read The Entire Bankaholic Post

First-time Home Buyer Seminar A Success

Our first home buyer seminar yesterday at the Best Western in Haverhill was a great success. We had about 20 very attentive people attend and an experienced group of speakers.

I'd like to thank Rob Barr from VIP Mortgage, Josh Amsler from Jackson Home Inspection, Jeff Stelman from Shribman & Stelman, LLP and Dave Kres from Buyers Brokers Only, LLC for their participation.

We also raised more than $100 for charity. Thank you to everyone who attended. I hope you learned a lot.

We hope to have another seminar in late September or early October, so stay tuned.

With home prices down around Massachusetts from about 5 to 15 percent, depending on the city or town, first-time home buyers have a lot of options.

An April 1, 2008 article in the Boston Globe provides the following advice for first-time home buyers.

"Work with a buyer's agent who only represents you, not the seller. Neophytes especially need someone who can help them analyze the local market, negotiate a good price, and close the deal."

Read The Boston Globe Article

Buying Tips For The Spring Market

In the Boston Herald's Spring real estate section April 4, 2008, an article by reporter Paul Restuccia discussed "some unusual pitfalls that house hunters need to watch out for."

I discussed foreclosures with Paul on Tuesday April 1, 2008.

"Foreclosures. Richard Rosa of Haverhill’s Buyers Brokers Only said purchasers should exercise care when looking at foreclosed homes.

“'Some bank-owned properties can be good deals, but almost all of them need work,' he said. 'If you don’t have the money to fix them up after you buy, the work will never get done.'”

“Short sales. Also use caution with 'short sales,' where a lender agrees to let a homeowner sell a home for less than the mortgage balance.

"Rosa got a bank to accept a $380,000 offer on Revere home with a $550,000 mortgage balance, but said lenders can take months to sign off on such deals."

Find foreclosed listings and short sales at MassForeclosed.com

Gary Dwyer, a buyer agent in Boston, had some good advice about purchasing homes that have been "rehabbed."

"When looking at rehabbed properties, beware of what Gary Dwyer of Buyer Agents of Boston calls 'caulk-and-spackle' renovations: Cosmetic work that merely covers up problems."

I have seen many properties marketed as "like new" that have had poorly done renovations.

Read The Boston Herald Article

What Communities Are Worth Buying In?

The Boston Herald put together a special section April 4, 2008 on the Spring real estate market, including an article about places "worth spring-ing for."

Reporter Paul Restuccia did a great job. I spoke with Paul a couple of days ago  about the real estate market north of Boston.

Paul spoke with several buyer agents and buyer brokers to find out the places where potential home buyers could get a deal. I recommended Tewksbury, MA and Haverhill, MA.

"Broker Richard Rosa of Buyers Brokers Only likes Haverhill and Tewksbury this spring.

"He said Tewksbury’s median house prices have fallen 13.5 percent since 2005 to reach a modest $328,500. 'You can get a decent-sized house for a decent price in Tewksbury, and it’s an easy commute for those working in the Route 93-128 corridor,' Rosa said.

"As for Haverhill, median house prices there have fallen some 9 percent since 2005 to about $300,000.

"Add in a revitalized downtown and Haverhill offers 'both the city and the suburb,' Rosa said."

I also suggested a good deal.

"Unit 8, 48 Farrwood Drive, Haverhill. This two-bedroom, 2,100-square-foot condo costs $249,900, or just $119 a square foot. The unit offers two deeded parking spots, a new roof, a new heating system and new windows."

Other buyer agents/brokers suggested (Metro West) Needham, Natick (south of Boston), Plymouth and Norwell. In Boston Proper, Brighton and the Savin Hill section of Dorchester were suggested for condos, and Hyde Park's Fairmont Hill section for single-family homes.

Read The Boston Herald Article

First-time Home Buyer Seminar April 5, 2008

Buyers Brokers Only, LLC is sponsoring a first-time home buyer seminar on Saturday April 5, 2008 from 10 a.m. to 12 p.m. at the Best Western (401 Lowell Avenue, Haverhill, MA) in Haverhill.

Learn about every aspect of buying a home: mortgages, pre approval, finding a home (single-family, condos, multi-families, new construction), the multiple listing service (MLS), buying bank-owned properties and short sales, negotiating the best price, home inspections, purchase & sale agreement, the closing, tips and advice from the professionals and an opportunity to ask all your questions.

Space Limited: Please RSVP by filling out the form online or by contacting Alexa by April 3, 2008 at 978.457.4552 or astone@buyersbrokersonly.com. Space is limited to 50 people.

Knowledgeable Speakers:
Richard J. Rosa, Esq., Buyers Brokers Only, LLC: Rich is a real estate broker, lawyer and co-owner of Buyers Brokers Only, LLC. He has practiced law for 12 years, and he is a member of the Massachusetts Association of Buyer Agents.

David S. Kres, Esq., Buyers Brokers Only, LLC: Dave is a real estate broker and lawyer, as well as co-owner of Buyers Brokers Only, LLC. Dave earned the North Shore Association of REALTORS® (NSAR) Rookie of the Year award in 2006 and currently is the president-elect at NSAR.

Robert Barr, VIP Mortgage: Rob is the vice president of sales for VIP Mortgage, located in Danvers, MA. He has 20 years of experience in the mortgage industry and has helped more than 1,000 individuals/families finance their first home.

Jeffrey Stelman, Esq., Schribman & Stelman, LLP: Jeff is a partner in the law firm of Shribman & Stelman, LLP, located in Salem, MA. He has practiced law for 17 years and has conducted more than 1,500 real estate closings.

Josh Amsler, Jackson Home Inspection: Josh works for Jackson Home Inspection in Andover, MA. He has more than 10 years experience as a licensed home inspector and has completed more than 6,000 home inspections. He also is a member of the National Association of Home Inspectors.

Donation: $15 per person. All proceeds going to Rebuilding Together Greater Haverhill, Inc., which helps revitalize homes and neighborhoods for low-income homeowners and communities in need, especially the elderly, the disabled and families, helping them to live in warmth, safety and independence. Please make checks payable to Rebuilding Together Greater Haverhill Inc., and please mail checks to Buyers Brokers Only, LLC, 7 Kenoza Avenue Haverhill MA 01830. Space limited to first 50 people, so please RSVP.

Appraisal v. Inspection

An appraisal and an inspection are not the same thing.

Many first-time home buyers wonder about the difference between a property appraisal and an inspection, and how each is used during the home buying process.

An appraisal is a formal assessment of the value of a home or property. When you are seeking financing, the lender usually requires an appraisal to ascertain the value of the property in order to make sure the loan amount does not exceed the value of the property being sold.

An inspection is an assessment of the systems and structural integrity of the property. It's normally ordered and paid for by the buyer at the time of inspection to find any hidden problems with the property. An inspection is often written into an offer to purchase as a condition of the sale in Massachusetts.

In New Hampshire, an inspection is written into the purchase and sale agreement as a condition of sale.