Posted by & filed under Buying, Selling.

Home Inspections in New Jersey

Buying a home should always include a home inspection. Even if the home is new construction, it’s best to have the guidance of a professional home inspector. In New Jersey, home inspectors are licensed by the State but there’s also another resource for you – the American Society of Home Inspectors known as ASHI.

ASHI was started in 1976 by a group of home inspectors who wanted to set standards of practice and create a learning center for inspectors, buyers, sellers and real estate professionals. Every member of ASHI must take a Standards and Practices training module and agree to abide by their Code of Ethics. Today ASHI is the largest trade organization of home inspectors in the US. I consider ASHI to be a wonderful organization and only recommend home inspectors who are both licensed in New Jersey to perform home inspectors and members of ASHI.

BTW, when you’re on the ASHI website at, be sure to check out the Virtual Home Inspection

You should always attend your home inspection. It’s one of the most important parts of buying a house plus you’ll learn a lot about your new home. The average inspection takes around 3 hours but this varies on the size and condition of a home. Be sure to bring a pen and pad so that you can take notes during the inspection. The inspector will tell you about the home’s condition and teach you how to maintain various aspects of it.

Home Inspections for Sellers

If you are selling, it’s a good idea to inspect your home before it’s for sale. Pre listing home inspections uncover problems you never knew existed.  It gives you an idea of what a buyer will hear too.  This is very important for a seller.  A major cause of failed contracts is the home inspection.  Issues found can frighten a buyer and sellers it personally insulting.  This is not the best environment to negotiate to a place that’s fair for both sides.  As a result, contracts fail.

Because of this it’s smart for a sellers to use pre list home inspections to fix issues first.  Then market your home for sale.  Let me know if you need help or have questions.

Posted by & filed under Buying, Selling.

You need Bergen County homes sales data from the New Jersey MLS so you’re on top of the market.

The New Jersey MLS is the primary multiple listing service for all of Bergen County. They do a simply outstanding job in so many ways. There is comprehensive information on homes for sale as well as statistics on all aspects of the market.

The sales data shows an improving market for homes in Bergen County. The number of days it takes to sell a home has been decreasing since March. If you take a look at the NJMLS Average Days on the Market Graph you’ll see this very clearly. While it’s still taking more than 100 days to get a home sold, we’re closing in on this number. I bet we’ll be under 100 days to get a home sold very shortly.

Take a look at the Average Sold Prices Graph. It shows a definite move up although this time it begins in April. However, this makes sense because almost all first quarter sales come from contracts written during the prior year. What this graph shows it that we’re moving toward an average home sale of $500,000 and that’s positive.

I’m not saying that house prices are going up – prices for homes are not going up. They will actually continue to go down for a while yet but you can only get a rise in the average sales price for a home when more expensive homes are selling. That happens when the real estate market is getting better throughout all price ranges.

First time home buyers have been kept in the market by such things as the First Time Home Buyer $8,000 Tax Credit which, one week ago, was added to FHA backed loans and low mortgage rates. As everyone knows, it takes the first time home buyer to get things moving and it sure looks like this is happening. At least that’s what the New Jersey MLS data shows.**

**These graphs are time sensitive and so the links are no longer active.

Posted by & filed under Buying, Selling.

On January 27, 2009, a home at 221 Churchill Road was listed for sale at $1,590,000. This was an extremely well kept original ranch on a gorgeous acre lot. It was listed twice – as a single family home and as a building lot. Tenafly East Hill original homes are in high demand.  Their acre properties are sought after by builders as building lots.  Builders knock these homes down to construct a new luxury home.

A short while after being listed, the house was reduced to $1,425,000. It took only 2 weeks more to negotiate an accepted offer on February 23rd. This is notable because the buyer looked at this as a building lot transaction.  Therefore it demonstrates the strength of demand for new high end construction.

What happened next is even more intriguing.  It confirms the demand for Tenafly East Hill new construction.

On May 22nd the home came back on the market for sale. I called the listing agent to find out what happened.  She told me that the sellers were purchasing a short sale property out of the area.  They had thought they were nearly at the end of their short sale purchase.  However, this was not the case.  As a result, the builder buying 221 Churchill cancelled his contract because he needed to get on to another option.  He simply couldn’t keep waiting.

Short sale transactions can take many many months.  It can be as long as one year. If you are buying a short sale and your buyer is not prepared to wait 6-9 months, it’s not going to work in most cases.  221 Churchill thought they were within 30 days of closing when an unexpected issue popped up.

The home went back on the market on May 22nd at the start of the Memorial Day Weekend. I am sure you will agree that holiday weekends aren’t the best time to start marketing a house.  What did happen was multiple offers almost immediately.  The house accepted offer and was in Attorney Review again in 5 days.

This tells you that the market for luxury homes on the Tenafly East Hill is still strong and that the market is stronger now than it was at the end of February. But wait, you say, if things are so fine and dandy on the Tenafly East Hill, why are there so many homes for sale? Because they are not marketed correctly. It really IS as simple as that.

The listing agent for 221 Churchill Road had it marketed as both a residential home and a building lot.  High end homes that are in original condition are the weakest part of the market.  Luxury home buyers want it done.  They don’t have the time or the inclination to renovate.  As a result, those homes on the Tenafly East Hill are all building lots. That’s how they sell and that’s how they should be marketed.

The homes sitting on the Tenafly East Hill are mis-marketed.  Those agents, in my opinion, are telling the owners the fairy tales they want to hear.  So the homes sit and sit and sit.  I see something else too.  Those homes are not being marketed using modern advanced methods.  They are just dumped in the MLS system, put in shiny brochures and advertised in high end magazines.  Frankly that’s not how it works.  I come from a very wealthy family.  No one bought an estate because they saw an ad on Unique Homes.  And they didn’t buy a Rolls from the Robb Report either.

Demand for new construction on the Tenafly East Hill is strong and getting stronger.  If you have a home on the East Hill that’s more than 5 years old, don’t listen to the fairy tales if you want to move.  Call me.  You’ll be surprised at what creative modern marketing can do for you.

Posted by & filed under Buying.

A FHA tax credit for home buyers has just been announced.  This is truly great news for the real estate market.

U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced yesterday, May 29th, that the Federal Housing Administration (FHA) will allow home buyers to apply the Obama Administration’s new $8,000 first-time home buyer tax credit on FHA mortgage loans. Previously the tax credit only applied to conventional mortgages. The only catch is that the tax credit cannot be used towards the minimum 3.5% down payment. But, this is still terrific and a great help for people who need to use a FHA insured mortgage loan.

Secretary Donavan said that the objective of this FHA tax credit is to help stabilize the housing market.  The hope is that this new FHA tax credit will stimulate more home sales across the US.  It should certainly do exactly that because it makes buying a home easier. With the ability to apply the tax credit to purchase costs, buying a home now becomes affordable for thousands of people and affordable enough to get thousands to jump off the fence and into a house.

FHA loans are extremely popular with first time home buyers because qualifying for a FHA mortgage is a lot easier than qualifying for a conventional loan. The ratios are easier and the down payment can be as little as 3.5% although I must tell you that I do not approve of buying a home with such a low down payment. What I tell my home buyers is to wait until you’ve saved up at least a 10% down payment.

Interest rates moved up and down this week.  We’re still in the 5-5.5% range for what most people really qualify for in a mortgage. Its been like this all year and projected to continue into the New Year.  As a result, rates are not a problem.

The reason the first time home buyer market is critical to the housing market is because this is where the housing domino chain begins – when a home buyer buys a house, he buys it from someone who often moves on to a bigger house and so on and so on. The entire chain of transactions begins with the first house that is sold and that’s your first time home buyer.

If you look at the real estate market the picture you see is a pyramid.  The the least expensive homes are the majority on the bottom and the fewest are the most expensive on the top.  Homes on the bottom are almost all first time home buyer purchases.  The real estate market would collapse without first time home buyer purchases.  As a result the new FHA tax credit is important for the strength and stability of real estate.

Posted by & filed under Buying, Selling.

absorption rateWhen people decide to buy a home they naturally start to look at the real estate market, do some number crunching and find statistics which explain the market trends. Lately, a statistic on homes that’s been quite popular is the absorption rate.

Absorption rates simply put tell you how long it will take to sell off the existing inventory of homes. This shows you how properties are selling; it’s measured in months as in how many months it will take to sell all the homes for sale. Understanding market activity is important but I think that looking at absorption rates this early in the year can be misleading.

No matter the economy, the housing market has a unique rhythm of it’s own. Most homes for sale go on the market during the early part of the year and are sold during the summer so statistics for the first few months of the year that track the relationship between sales and available inventory can be tilted in the wrong direction. In fact, absorption rates at this point can be very confusing if you look at the report appraisers use when they do an appraisal on a house. This is the 1004MC Report.

Let’s look at Tenafly, NJ. If you go back 12 months from today, the Tenafly real estate market for homes really looks weird. For example, take a look at the number of Active Listings – it looks terrible doesn’t it? Well, what would you expect for this time of year? It’s always larger now because more houses are on the market between March and June. At the same time, how long a home is on the market for sale is currently half what it was previously. That is extremely important. In truth, Tenafly houses are selling very well. Tenafly homes are always in strong demand. The New Jersey MLS 1004MC Appraisal Report for Tenafly is here for you to see:

PLEASE NOTE:  This report ties into the active inventory of the New Jersey MLS at the time and since we are past these dates it defaults to a blank state.  I am leaving this article in the blog to at least introduce you to this report.

absorption rate

Using the absorption rate isn’t always the best idea until you’re further into the year.  So look to the 1004MC Appraisal Report to give you a better over view now.

Posted by & filed under Selling.

Beware of short sale fraud.  This is a growing problem in the short sale market.

There is a new thief who preys upon homeowners who must put their home on the market as a short sale. Simply put, a short sale occurs when a homeowner can no longer pay his mortgage, has no other assets and the loan amount is greater than the home is worth. As a result there is a shortage between what’s owed on the home and it’s market value. The only way a homeowner can sell his home is by getting the bank to accept this shortage, thus the term “short sale.”

These new thieves market themselves as having all the solutions to your problems because they have a “special” ability to negotiate a short sale with the bank. Nothing could be farther from the truth. What really happens is that a desperate homeowner is taken advantage of by these horrible people because the truth is that they are completely unnecessary.

Realtors do short sales all the time. If you must put your home on the market as a short sale, your listing agent can do the work and negotiate with the bank on your behalf. You can also ask your attorney to do this for you and many people do. What you don’t need is to encumber yourself with an unnecessary expense by hiring one of these charlatans. They are today’s version of the proverbial “snake oil salesman.”

I have worked on short sale transactions successfully. It is a tremendous amount of work and takes a long while. Everyone involved needs a lot of patience but eventually things do work out. Buying a home that is a short sale means a long wait for the buyer. Sometimes a buyer will cancel his contract out of frustration – it takes months and months to see if the mortgage bank will accept the buyer’s offer. But, hiring one of these thieves will not help you – it only wastes your money on these frauds. Every bank has it’s own unique process and no one can make a bank move any faster.

Don’t allow a predator to hurt you – if you have any questions, email me and if I don’t know the answer, I’ll find someone who does.

Posted by & filed under Bergen County LIfe.

adopt a dog

Adopt a dog.  Say Hi to Elton!

Begen County is filled with families and children. There are many great facilities for kids which I’ll be talking about but I also want to feature some of the pets waiting for adoption here because we have many pet facilities where you can get a great pet.

Very often after a family moves into their new home, they get a pet and that usually means a dog or a cat. Many home buyers buy a home and then get a dog because they are coming from apartments or the city where having a pet is not easy or allowed. There are so many wonderful dogs and cats in our animal shelters and here’s one who’s on the Urgent List at The Bergen County Animal Shelter which means poor Elton doesn’t have a lot of time left on this earth.

Because so many families have lost their jobs or their homes or both, the animal shelters are overwhelmed. Bergen County has a large facility but they can’t handle the inflow and euthanize animals. If you know of anyone who’s looking for a good pet, take a look at Elton.

Fostering a pet is also something that’s urgently needed and it gives you a good chance to see if you and a dog are a good match. I know of many good pet organizations in Bergen County where you can get advice, help and obedience classes so that you and your new dog can bond properly. Take a look at Elton – you’ll be glad you did.

Posted by & filed under Buying, Selling.

Fannie Mae and Freddie Mac buy mortgages which means that they guarantee them. Without the backing of Fannie and Freddie, mortgage lenders have to find other investors to sell their mortgage loans to and those investors charge more so interest rates are higher. Fannie and Freddie backed mortgages are called conforming; the others are called jumbo. The limit on a conforming mortgage is $417,000 but that is about to change.

There’s also an intermediate level which is a special allowance for higher cost areas like Bergen County. Such mortage loans are at $417,000 – $625,000 with moderately higher interest rates than conforming loans. This is a super conforming loan but marketing folks have coined the phrases Jumbo and Super Jumbo. You’ll see a Jumbo Mortgage at $417-625,000 and Super Jumbo above $625,000.

OK, now you should have a good basic idea of how things work. Here’s where it gets interesting:

Fannie Mae and Freddie Mac are increasing the conforming mortgage loan limits to $729,750 on May 4th. This came about due to the economic stimulus package which was signed into law on February 17th. Wells Fargo will start taking applications for these loans on Monday, April 27th and I’m sure other banks will begin before May 4th too.

New Jersey MLS data shows that the 2008 average sales price for a single family home in Bergen County was $570,217. Even with a 20% down payment, this put a buyer into jumbo loan territory. In several towns it was often impossible for many buyers to qualify and is part of the reason that upper mid range homes have had such a hard time.

In the upper mid range market, it’s really been tough due to the restrictions on conforming loans. Loosening up lending for these homes creates more buyers for sellers. For real estate in Bergen County this is huge. Bergen County is the 18th most affluent county in the US; many of our towns have been severely impacted by the $417,000 limit and even $625,000 didn’t quite work.

For example, Tenafly had an average sales price last year of $915,581, Old Tappan was $1,147,159 and Woodcliff Lake was $838,309 plus many other Bergen County towns have scores of homes that will benefit. If you are a home buyer who’s looking at $850,000 homes, think of how this will help you! You won’t have to pay a point and your interest rate just dropped.

Think of the impact this will have on real estate in Bergen County and across the United States. Buying a home is never an isolated transaction. Real estate is a chain of events – there are homes sold above and below your own transaction so anything that happens in one price range affects it all. This is going to have quite an impact.

Fannie Mae and Freddie Mac allow our mortgage system to exist and move forward.  As a result, I will keep you updated on this works out and any other future changes.  If you have questions call me at 201-741-8490.

Posted by & filed under Buying.

The spring market for homes in Bergen County really feels like it’s accelerating.  Let’s check it out and see what’s truly happening.

Since the beginning of March the housing market for homes in Bergen County has really picked up.  Because  we are now nearly through April, I thought that I would take a look at the MLS data.  I want to see if what I’ve been sensing is really happening.

I have been discussing this with many colleagues and reading reports by economists.  However it’s also true that those in real estate are often a very optimistic group.  Since this is true, I thought it best to go into the New Jersey MLS and check.

Here’s what I found:  The spring market is truly are picking up. Real estate is improving most definitely.  It’s not dramatic but haven’t we had enough drama over the past 9 months? The market is steady and that’s good.

Take a look at the figures below and you’ll see what I’m talking about. More buyers are coming out to look at homes and more homes are taking offers. Here are homes that came on the market for sale and which went under contract so far this year:

Jan – 1,232 Active/286 UC = 4.3 to 1 ratio
Feb -1,255 Active/335 UC = 3.8 to 1 ratio
Mar -1,693 Active/443 UC = 3.8 to 1 ratio
Apr -1,311 Active/413 UC = 3.2 to 1 ratio

The April figures are through today, April 23rd, and they certainly indicate continued improvement for Bergen County homes. What hasn’t been so clear are the Days on the Market figures but you really can’t get a sense of where that’s going until we’re further into the year because almost all sales in January and February originate from the previous year. But in March it took 110.64 days to sell a home and so far in April it’s been taking 103.59 days to sell a home which is a positive change.

The real estate market is always more active during the spring and early summer months.  This year the spring market is developing a pattern that is quite normal and that is excellent news. For a home buyer, this is really a great time to buy a home.  Prices will only go up in the future because we are definitely moving up.

t increasing numbers of people are sensing this and acting.

Posted by & filed under Buying.

“How’s real estate and what should I do?” I am receiving so many calls and messages like this that I thought I should post some answers. It seems that real estate is on everyone’s mind lately.  Let’s find out how to handle the Bergen County housing market.

Here’s something to consider: A primary motivating factor for most people is simply because it was the right time. So ask yourself this question – Is this the right time for you?
The right time to move can be due to many reasons such as getting your kids out of the city and into a backyard with pretty lighting, you’ve outgrown your home and need more space, you’ve had it with renting and want your own place, you’re ready to move to your dream retirement, everyone’s moved to California and you’re still in Bergen County etc.

If you’re wondering how to manage things based on how the real estate market is doing in Bergen County, here are some answers to help you:

Are you thinking of buying a home? Do it now – we’re at or near the bottom with mortgage rates at historic lows; inflation, with its high interest rates, is projected for the future.

Want to move up to a larger home? Move up now – the cost of upgrading is always the cheapest when you’re around a market’s bottom which is where we are today.

Own a home and not moving? Check your mortgage rate immediately. No matter when you purchased or if you did refinance recently, do this for your own benefit.

Thinking of selling your home? Get your home on the market now – you stand to lose another 5% this year so waiting will hurt you.

Not sure if this is the right time to move? Then don’t. If you’re not sure, its always best to stay put. However, it’s also best to investigate your options fully; I suggest you do this bi-annually.

Let me know if you have any other questions about how to handle the Bergen County housing market today.  All you have to do is contact me today.