Blog Archives

The Famous 3.8% Real Estate Tax

There’s nothing like misinformation to cause confusion and despair.

The popular story we’ve heard circulating a lot is that—starting January 1st, 2013—anyone selling a home in this country will be hit with a new 3.8% tax to help pay for President Obama’s new healthcare plan.

Not true.

It’s true that the new tax does take effect with the start of the new year, and it’s true that some real estate sales will be subject to the tax.  But it’s not a real estate tax, per se, and many people selling homes will not have to pay the tax.

So, just what is it?

“It” is a tax on some investment income.  Interest, dividends, rent and capital gains will be subject to the tax, but only for people whose adjusted gross income is above $200,000, or couples who file jointly and whose AGI is above $250,000.

If you’d like information that makes this tax more understandable, check out this one page flyer showing the Top Ten Things You Need To Know About The Tax.

Hopefully, these facts will show that—while the tax is real and it’s about to take effect—its scope is more limited than many people have been led to believe.

David

Are Birmingham Area Homes Selling?

From time to time, people ask us, “How’s business?”

If you look around and ask various Agents throughout the Birmingham area how their business is going, you’re likely to get varied answers.  One Agent we spoke with recently has struggled much of the year.  Other Agents we know have been doing much better.   Colleen and I have had an extremely busy year, for which we’re grateful.

The fact is that—regardless of the economy in general and what’s reported in the news media—homes still sell.  That’s because people’s lives change.  New jobs, a change in family size or wanting to be closer to a particular area can be among the reasons.

I’ve heard people thinking of selling their home say, “I’ll wait until the economy improves.”  To be sure, values are still down considerably, compared to previous years.
But that can also be like saying, “I’m going to buy a new car when the models get better.”

Here in the Birmingham and Shelby Co. area, the number of homes for sale in many communities is down considerably, compared to previous months.  In Shelby County’s Alabaster and vicinity, the Birmingham MLS shows 220 homes for sale at present.  This continues to be among the lowest numbers we’ve seen.

This drop in inventory is having an effect.  Homes for sale that we consider excellent deals don’t stay on the market long.  Buyers are out there, and pounce as soon as the excellent deals appear.

I’ve heard some home owners trying to sell without luck lamenting the lack of Buyers.   It’s really not that Buyers are scarce.  It’s just that they’re finding better deals elsewhere; the homes they wind up buying are in nicer condition, have more features, or are priced more attractively (or maybe all three).

A home needs to have pizazz to sell in the current market, and must be priced to grab a Buyer’s attention.
Homes lacking these attributes typically take much longer to sell (we’ve seen homes remain on market over a year before getting an Offer).

When it comes to getting your home sold, there are definitely success stories in the Birmingham area.   Colleen and I recently listed a home in Alabaster that got two Offers and went Under Contract 13 days after going on the market.  The Seller was motivated, priced his home so that Buyers had to notice, and has done a lot of fixing up to make his home look nice.  The payoff to his work is that his home is set to sell, so he can move.

The drop in inventory being seen in some areas around Birmingham is starting to put a bit of a squeeze on Buyers.  The Buyer who sees a really good deal on a home for sale in this area now realizes that there’s a chance to be taken by waiting:  Someone else might swoop in and grab the home in the meantime.

If you’re looking to buy a home in the area, our advice is to think about what’s important in a home to you, as well as area, and to contact us (205-356-5412).  If you’re planning to get a loan, another critical step to take early in the process is to get in touch with a Lender.  Here is a link to some area Lenders we recommend contacting.

Remember that the world of home mortgages can be confusing, because there are so many different kinds of loans and differences in fees, down payments and other charges.   A good Lender will be able to sort this out for you to help to simplify your decision.

Getting quotes from other Lenders to compare is a good idea, too; just be sure to understand that comparing different loans effectively means looking at all the overall costs, and not just a single fee that might be higher with one loan.  You might also ask about “locking” in your interest rate (which involves being assured of getting the same rate if you wind up buying a little later).

By following these steps, you’ll be on the road to being part of the home sales success stories we’re seeing throughout much of the Shelby Co. and Birmingham area.

David

One Black List in Birmingham To Be On…

Most of us do our best to stay off other people’s black lists, but here’s one worth getting on.

With so many great real estate opportunities appearing in the Shelby Co. and Birmingham area, we started a quick notification e-mail list we call The Black List; it’s for folks wanting to pounce when really good deals show up.

Pounce is probably the right word.  When we saw one home go up for sale in Helena not long ago, it drew 17 Offers.  Rest assured that—when the really good opportunities show up—someone will be ready to make an Offer, and fast.

If you want to be in a position to take advantage of these great deals when they hit, The Black List is a good way to be ready.  We use it only when properties go up for sale that we consider especially good opportunities.  These are not confined to homes we, ourselves list for sale; the homes we report could be listed by any Agent in the area.

How often do we sent out Black List notifications?  That depends entirely on what the market has to offer at any given time.  Again, it must meet our criteria, or it doesn’t get reported.

The Black List reports on good opportunities for conventional/re-sales, new construction, Short Sales and Foreclosures in the Shelby Co. and greater Birmingham area.

The Black List is free to join.  To join, go to our website’s main page and enter your e-mail address at the top.  Your information won’t be shared, and you won’t be spammed.  You can unsubscribe at any time.

David

First Steps All Home Buyers Must Take

Walking on to a new car lot can be fun.  You get to see all the latest technology and styling, and imagine yourself behind the wheel.

And then, after glancing at the sticker, reality sets in.

Looking was fun, but the sticker reminds that—before you can actually own that new car—you’re going to have to play the “show me the money” game.

Having your funding secured for the purchase of a new home is just as important.  After all, if you don’t have the money needed to make buying a home a reality, what’s the point of looking?

Having enough money on hand to pay cash for a home is great, but let’s face it … not everyone can do this.

The alternative, then, is to get a loan.

Unfortunately, a number of people looking to buy a home in the Birmingham area wind up starting the loan process the wrong way, which goes like this:

  • Buyer decides to buy a home
  • Buyer starts the home search, driving neighborhoods, looking at homes
  • Buyer finds the perfect home (“I want it!”)
  • Buyer starts envisioning the new home as theirs (“Living here will be great!”)
  • Deciding to move ahead with purchase, Buyer asks Lender for a loan
  • Lender looks over Buyer’s information and says, “sorry, can’t help”
  • Entire process comes to screeching halt

The scenario above is a classic invitation to major Buyer disappointment.

It doesn’t have to happen this way.

Colleen and I feel strongly that the first–and most important–steps in the home buying process are to contact us as your Agents and then speak with a Lender.

By finding out how much money you can borrow before you start looking, your search will be easier, as well as more targeted to properties that fit within your price range.  If there are parts of your financial background that need work, a Lender can be a good resource for charting a course for you to follow so you can be approved.

If you’re thinking of buying a home, a good Lender will answer all of your questions and make you feel comfortable with the entire process of obtaining financing.  Since buying a home is the biggest purchase many people make, if you don’t have this feeling of comfort, our advice is simple:  Find another Lender.

Buyers lacking some time of financial qualification may be in for a surprise, given a reality we see all the time in the Shelby Co. and Birmingham real estate market:

Sellers want some assurance that a prospective
Buyer can actually obtain needed funding.
“Show me the money.”

If you try submitting an Offer without including either a loan pre-qualification or verification of funds (if paying cash), many Sellers simply won’t deal with you.

We know of several good Lenders in the Birmingham area with a thorough knowledge of the mortgage profession, different loans, costs and how they work.  These Lenders have a strong commitment to providing good service.

Fortunately, most of our Clients purchased their home the right way, having contacted us first and then following our advice on consulting with Lenders before we started helping them with their search.

As a result, they are now happy homeowners.

David

Birmingham Home Sales Thoughts for 2012

As Fisbo, our highly spoiled six pound poodle, and I took our early morning walk a few days ago, I used the time to contemplate how our real estate business has evolved during 2011 and thought about what’s ahead as we kick off 2012.

Our walk was made rather intriguing because the neighborhood was shrouded in fog, limiting visibility sometimes to only a few hundred feet.

You can’t see very far ahead, and as you keep moving, what’s behind you grows increasingly vague.

Predicting home sale trends in Birmingham and Shelby County can be a little like walking into the fog:  You can see a certain distance in front of you, but after that, knowing what’s ahead gets tricky.

That’s not to say we’re in a fog about what will happen, market-wise, during 2012.  In fact, Colleen and I are optimistic that a lot of people will be buying and selling homes during ’12.

We think it’s going to be a busy and successful year.

Our optimism about ’12 is due in part to 2011, a year that was not only productive for us, but outperformed previous years.

For a lot of people in the Birmingham area, 2011 was a very difficult year, with the April 27th tornado affecting so many thousands of people and Jefferson County declaring the largest municipal bankruptcy in history.

I believe the new year will be one of healing and stories of success.

So, what does this mean for you if you’re thinking of buying or selling a home?  Okay, watch out, I’m getting out the crystal ball!

If  You’re Buying:

2012 will be a year of excellent opportunity.
You might have to spend a little more time picking and choosing than during previous years, because inventory in some areas has dropped.  This doesn’t mean the good deals are gone.  It just means you’ll have to do a little more work to find them.  An Agent with a good knowledge of the market as well as sharp negotiating skills will be one of your most valuable assets during this time.

Pricing will continue to be very much in your favor, but if you’re in search of a “steal,” you stand a greater chance of a Seller saying, “no deal.”  If inventory continues to drop, Sellers have less competition, and therefore less reason for agreeing to a “fire sale” Offer.
The Buyer who understands and accepts this still stands to get a very good deal.

With no sharp rise in mortgage interest rates on the horizon, ’12 is shaping up to be another year of tremendously low borrowing costs.

If You’re Selling:

You will be in a better position to get your home sold than in some previous years.   Home values will continue to be a big challenge, but the news isn’t all bad.  With the number of homes for sale dropping in some areas, what has been very much a Buyer’s Market shows signs of changing.  That’s a good thing, but the change is going to be gradual.

During ’11, we saw many homes sell for the same price they sold for ten years earlier.   This was great for the Buyer, but not for the Seller.  Seeing both Buyer and Seller bring checks to the closing table was not uncommon last year.

If you plan to sell during ’12, understanding one “fact of life” about the Birmingham and Shelby Co. real estate market will help:  The maximum a Buyer thinks your home is worth may wind up being significantly less than you had anticipated.

We do feel optimistic that the slide in values is beginning to ease.  This easing, however, is likely to be so slow and so slight that many people selling in 2012 may not feel it’s very noticeable.  It’s important to remember, though, that the slide in home values didn’t happen in a few weeks or months, but rather, took years.   Any correction won’t happen fast, either.

And then there’s the matter of your home’s condition.  Do you want your home to appeal to a majority of possible Buyers or only a few?  In the Birmingham and Shelby Co. area, the overwhelming majority of Buyers we work with want homes that are immaculate, need nothing done, and are “move-in” ready.  We do get calls from Buyers looking for places to fix up, but they expect to pay “bottom dollar” for the work they know they’ll have to do.

A 2011 High Point:

Of all the homes Colleen and I sold during 2011, one property we were particularly excited to sell was a home in Alabaster.

Price wise, this home was nowhere near our biggest sale.  But it’s not about the money.

The Seller had tried to sell five times before, starting three years ago, and not had success.
This was a sizable home in extremely nice, clean condition.  But the sales price had never been in alignment with what was taking place in the Shelby Co. market, and we didn’t feel that the property had been marketed correctly.

Lowering the price was not easy for the Seller to do.  But we worked hard in marketing the property, and our Seller worked hard, too, cooperating closely with us as we moved toward our common goal.

That team work finally paid off with a successful closing.

It pays to be a student of the market.  Many of the sales Colleen and I helped with here in the Birmingham area offer lessons to the wise if you’re thinking of selling during ’12.

A 2011 Low Point:

We had many successful sales last year.  But one home we listed in No. Shelby Co. was not destined to be one of them.  It stayed on market for five months and never received an Offer.  The home was not priced correctly, drew very little interest, and had significant structural issues cited by many of the few Buyers who actually looked inside.

During one phone call, the Seller (who had moved out but was still making monthly payments) says, “I really need to sell this house.”  Only seconds later—during the same conversation, as we discuss pricing—he says, “I’m not giving my house away.”

The Seller’s viewpoint could be summed up in five words:  Take it or leave it.

Buyers gave their answer.

The experiences from both our High Point and Low Point provide clear support for a prediction we’ll make for the year, though it’s not the boldest call I could make:  2012 will show that price and condition have never been more important in getting your home sold.

Changes To The Dictionary:

As we kick off ’12, I’m also deciding that it’s time to change the definition of some of the terms real estate Agents use (hmmm …  am I allowed to do that?).

Agents have long referred to motivated and unmotivated Sellers.  These categories don’t exist any longer.  A Seller who is determined to do what it takes to get their home sold is, by definition, motivated.  They will adjust their price as needed and will make sure their home is immaculate (as so many folks we worked with did last year).  These are the people who, in all likelihood, will get to sit at a closing table.

The unmotivated Seller is typically unwilling to price attractively enough to receive an Offer.  They also choose not to deal with with the moldy smell in the basement or the rotted wood that needs to be replaced.  This person is not a Seller.  They are a home owner.  If they do happen to receive an Offer, it is likely to be for an extremely low price.

This year will be another time of great opportunity in real estate.  If you’re giving thought to buying or selling a home, you no doubt have questions.  Whether you’re a veteran or just starting out, Colleen and I hope you will feel welcome to contact us for assistance.

Feel free to call us at 205.356.5412 or 205.677.8686.  Or e-mail us at:  sales@theblackteam.com

And we’re on Facebook, if you’d like to join us.

As for walking through the fog, I look forward to it.  What might be ahead may not always be known, but if you’re determined to keep moving, the scene gets clearer as you forge onward.

Our optimism and positive thinking have us excited … we know there are lots of opportunities ahead.

We look forward to being part of your 2012 success story…

David

Blogging Blacks are Back

We’re back.

If you’re visiting our site for the first time, you may be thinking we’ve just now decided to jump on the blog band wagon.  Not quite.

We’ve had a blog on our website for several years, but fell victim to a server attack last week.  Whether several years worth of interviews, comments and real estate information will be able to restored is uncertain at present.  We’re hoping the content can be recovered, but we’re not counting on it.

To confess, I was pretty upset upon first realizing how much information may have been lost.  But the morning walks I take with Fisbo, our spoiled six pound poodle, helpFisbo, The Black Team's Marketing Manager bring me to a new understanding.

Looking at the pre-dawn sky and enjoying the spectacular display of stars our crisp, clear autumn weather has made available, you’re reminded pretty quickly about how big our universe really is, and what size we are, in it.  As I look at light that has traveled thousands of years just to get here, the potential loss of a blog in that huge, big world…well, it doesn’t seem quite as significant.

One of my favorite sayings is that every day is an opportunity.  We have the opportunity to create all sorts of new content we hope will be informative and entertaining.  And one thing is for sure:  The real estate market is always changing.  So, fresh, new ideas and perspectives are needed, anyway.

The Birmingham and Shelby Co. area real estate market continues to be active.  Lately, we have seen more Buyers jumping at low priced opportunities, including Foreclosures.  Some Buyers are going for these as investments they plan to rent out, while others are seeing them as good opportunities to live in a home at never before available prices.

We continue to see significant drops in the number of homes for sale in the Shelby Co. and Birmingham area, too.  This is encouraging news for folks thinking about selling their homes, because it means there’s a little less competition out there, compared to previous months.

Right now remains a fabulous time if you’re thinking about buying a home, too, whether it’s your first place, or a repeat purchase.  No matter what part of the Birmingham or Shelby Co. area you’re considering, choices and price ranges are varied.

Finally, if you don’t quite have all the money in your pocket needed to buy a home, you may be thinking of getting a loan, and this continues to be a great time for that, as well.
Assuming you qualify, you can get a 30-year conventional loan for well under 4%, or a 15-year conventional loan in the low 3% range.

Got questions about buying or selling?  We’re here to help.  Call us at 205.356.5412.

It’s that old  ‘Every day is an opportunity’ thing.

David

New Homes in Birmingham in 120s…

New home prices are getting more attractive all the time. If you doubt that, consider this: In the Shelby Co./Birmingham area, you can have a new home built and pay in the 120s.

For some folks, those prices—coupled with interest rates continuing near all time lows—are just too good to pass up.

Colleen and I thought you’d like a behind-the-scenes look at a new home being built in the Montevallo/Alabaster area.

It’s a good chance to see what your money can buy for you. So, we fired up the video camera and invite you to tag along:

Whether you’re thinking of buying for the first time, or if you’re considering moving, pricing and inventory remain very attractive.

Got questions? Feel free to contact us at 205.677.8696.

Buying a home—whether new or existing—is a big decision, and we certainly recognize that.

Your best decision is always made when you have as much information as possible. We’re happy to help with any questions you have…

David

New Competition for Selling Your Home

Thinking of selling your home?

You already know there’s plenty of competition here in the Birmingham and Shelby Co. area.

But now, there’s a new force to deal with. Check out our video just below. This all started when we decided to pay a visit to a recently listed Foreclosure in Alabaster’s Lake Forest; you may be interested to see what’s happening inside…

We’re ready to help you with getting your home sold, successfully, and sooner, rather than later.

Give us a call at 205.677.8696…

David

Beautiful Music in Birmingham

Colleen and I learned quite a bit last night about violins. The knowledge comes courtesy of Ted Haddin, a violinist who plays Friday evenings at Nabeels, one of our favorite places to dine in Birmingham (outstanding Greek and Italian dishes, by the way).

I asked Ted what makes Stradivarius violins so coveted. Their origins go generations back in time to the forests of Italy, where wood was harvested and then aged, sometimes for so many years that a violin maker would use wood aged from generations before. Woods were treated with compounds made from various materials; the exact nature and mix of these compounds was often a closely guarded secret, making replication extremely difficult.

There is some debate about whether Stradivarius violins actually present superior sounds to all other violins; regardless, they are highly coveted and are believed to be only a few hundred in number. Depending on time and place of origin, a Stradivarius could fetch several million dollars today. Ted thinks he could tell a real Stradivarius from a fake.

Ted Haddin

I didn’t know this, but you can actually open a violin to fine tune some of the wood pieces inside, but it’s extremely delicate work and, done by the wrong hands, can ruin the instrument; only a few people in the country are considered experts at doing this.

Ted told us the story of a building superintendent entering the New York apartment of a man who had passed away, only to discover newspapers stacked to the ceiling. In one corner was a violin case, containing what turned out to be a Stradivarius.

Ted played a beautiful piece for us last night he wrote himself, called ‘Winds over Patras,’ named for the Greek community where John Krontiras, the owner of Nabeels, grew up.

Ted has been playing the violin since his childhood years. As a teenager living on a chicken farm near Tampa, Florida, Ted played classical pieces for his grandfather who was also a violinist and who owned a Stradivarius that Ted got to play. We can only imagine how proud grandpa must have been to hear those sounds drift across the field amid the feathers and eggs!

After his grandfather died, the coveted instrument disappeared, and Ted never saw it again. Life isn’t always fair, but given Ted’s love of the instrument and his ability to create such wonderful music with it, Colleen and I know who should have gotten it.

Stop by Nabeels on a Friday evening and ask Ted to play something for you. You’ll both enjoy it…

Alabaster Area Home Sales Rise in August

With summer behind us, here’s a look at home sales trends in the Alabaster, Maylene and Saginaw areas (stats from the Birmingham MLS):

ALABASTER - JAN-AUG 2010 SALES

After taking a dip in June, average sales prices are holding fairly steady:

ALABASTER - JAN-AUG 2010 ASP

How long does it take to get a home sold in these areas? According to the MLS, the time needed is just a little over two months (the shortest it has been all year):

ALABASTER - JAN-AUG 2010 DOM

Right now, 354 conventional single family houses and townhomes are for sale in the Alabaster, Maylene and Saginaw areas. Of those:

289 are priced at or below $250,000;
127 are priced at or below $150,000;
22 are priced at or below $100,000;
338 have 3 or more bedrooms;
170 have 4 or more bedrooms;
29 have 5 or more bedrooms;
113 have pools or access to pools;
5 have 4 or more acres…

Need a loan to buy? Rates right now continue to be among the lowest in history. Qualified borrowers can get a 30-year fixed rate loan for as low as around 4.25%; 15-year fixed rate loans can be found by some borrowers as low as 3.75%. Colleen and I have been able to help a number of first time Buyers say ‘adios’ to renting and move into their first homes with some excellent loans at very low rates.

Needless to say, this continues to be a tremendous time to buy a home … let us know if we can help!

David