All Forum Posts by: Mary Jo Carruthers

@Albert Hepp Did you know that there are quite a few non profits and also the city of Austin in the austin texas area that provide down payment assistance for first time home buyers? If first time home buyers are having a difficult time coming up with the funds for even the costs to play as a first time home buyer then are the non profits supposed to pay the buyers agent commission too? 

Given that affordable housing is a national issue it seems that the more pathways to home ownership is a good thing. If the costs for home buying goes up for first time home buyers then the results will probably be that less starter homes will be moving in the market unless non profits and the sort step up. What is happening in this market is that sellers are still paying but its negotiable like it was before.
 

Commissions have never been set. Its set by the market. The market tends to be 3% for buyers agent that is paid for by the seller in my area. In areas such as NYC the market tends to be a little lower, from what I understand. What is your source for 99% of transactions are above 2%?

In Minneapolis, are there programs in place from non profits and the government to aid first time home buyers with costs? A quick google search reveals that Minneapolis provides assistance for first time home buyers so there seems to be a problem with funds for first time home buyers in your locale too. In your ideal world who pays the buyers agent in that first time home buyers niche in Minneapolis? 

Fees for buyers side has never been set in stone. It has been the case for many years, even before the lawsuit. Its market driven. It will be very interesting to see how this plays out for first time home buyers that don't have money to pay a commission to buyers agents. 

@Albert Hepp I see that you have been offering flat fees for years and that is your business model to undercut market rates. Nothing wrong with that as I am sure that you increased your volume. Awesome strategy! 

 When folks start to argue one way or the other with it, there seems to be an assumption that the buyers agent does very little before or during the transaction. The best buyers agents provide insight to the market, negotiate to get a better deal, provides clarity to the transaction, steadies the nerves of buyers (first time home buyers for example), identifies problems with the property, introduces a whole cast of players to get the deal done etc. Oh and I forgot to mention that they are a ton cheaper than an attorney.

Some people that my broker knows spent money on an attorney to draw up a contract who meant well but caused more harm than good. It was a several million dollar commercial deal that was going sideways before we got involved and steadied the ship. I could go on and on but some folks have their minds made up until they find a superb agent who takes their craft seriously.  

Yes, you will need a permit. Its likely that you won't get it though. Go to the permit department and ask before you start putting money into it. The permit department folks are generally very helpful. I have seen houses where folks did it anyways without the permit but that is really value destroying as it will make it very unlikely to sell for top dollar with that layout. 

I agree. I expect that the Fed will drop rates next week and will continue to do so.

Austin metro keeps expanding. Jarrell is planning on a population surge of 50,000 new folks. Jarrell is on the north side of Georgetown and within the very fast growing Williamson County. That shows the growth patterns of the metro. Very interesting!!!

There has been so many models and ideas regarding commissions while some have floundered and some have altered the market place. This will not be the first attempt to reorient the commission structures nor will it be the last. I expect that over time the best buyers agents will be likely be less burdened by the so called "fixed rate" (which was never fixed in the first place) and charge more for their work if they have a history of making their clients money via negotiating, saving on legal fees, smoothness of transactions, market knowledge, etc. The value of that buyers agent is far superior than an agent that is simply a door opener. The same could be said for the sellers agent. 

The folks that are masters of their craft will likely get paid more vs folks that just dabble. 

I expect that the eviction costs for an attorney could be quite pricey. imo. It seems that you have a reason to evict them but its likely that you won't be able to get a court hearing until a few weeks out so sometime in mid Dec.  Since its a brand new build, its probably likely that the place is in good shape and any repairs will likely be considerably less than attorney fees. It might be worthwhile to wait until the lease is up in Feb which is only a few months out. Its a business decision, imo. Consult with an attorney and property manager to be sure. 

@Sunil Kale

Did you get your realtor to draw up the lease? What kind of lease do you have in place? Greg Scott is on point. You can't evict someone for late payments but you could for hoa violations but only if its spelled out in the lease.

I would suggest that if the tenant is late on the rent for december then refuse the late payment and file the eviction. It seems that the tenant has been there for a year or close to a year, probably since you bought the house in November 2023. 

When is their lease expiring? It might be easiest to simply not renew the lease if its a 1 year lease. 

Its really simple economics. Once the supply exceeds the demand, prices will go down. Too much supply hurts though. Other than increasing the supply, decreasing regulations or increasing competition will bring down prices. Regulations include NIMBYism, slow permitting, over permitting, zoning that has not been brought to current demands, etc. Shortages of construction labor and material will also have a major impact upon pricing. Oh and I forgot to mention the interest rates impact : ). 

In the Austin Texas metro, zoning is a big deal as it will have a major impact upon the supply of housing in a submarket. 

The banking industry is very competitive as there seems to be a bank on almost every corner. At times, we have simply went across the street when one lender said no or gave us a high quote. I am not sure about the impact that the use of mortgage brokers has upon pricing. But then again, I am not a lender so I don't know nor have I studied that idea to know for sure. 

Brrrr is a great strategy but one needs to be on point with the numbers. If you use hard money loans or fha 203k loan or some other construction type loan then you will need to be focused on the finance charges and shop around. There can be considerable differences.

Also you need to think about the refi on the back end. This can be tricky as it requires a little forecasting about the market in the near future. Lenders will refi at 70% loan to value (ltv) plus or minus 5-10% percentage points. The value will be determined by an appraiser hired by the lender. An appraisal is an opinion of value and that opinion could be off. 

Its important to have a smart realtor that can help you through the process and fight on your behalf. And I didn't even dive into the construction aspect and knowing what works and doesn't work for a chosen submarket.