Ann Arbor Home Buying

I spoke to some young home buyers last week who were both very intelligent, until it came to the world of real estate.

They at least had taken the time to read a book and ask questions about our company and others.

However I think I might have really turned them off when we talked about Zillow and using zillow.com to value homes.

The truth is Zillow can be interesting and can provide useful comparison information, but assuming the Zillow value projections are accurate enough to use for home buying is absolutely nuts.

Give me a fresh, smart buyer and about 3 days to review property (by going through actual homes) and I bet the fresh buyer would outperform the Zillow projections.

Here is a link to a couple posts that go deeper:

Reality and Zillow value projections

Labels: internet appraisals, market value, zillow

Another pet peeve post.
Real estate agents & companies that routinely lie and mislead in their printed materials.
Back about 13 years ago when Michigan real estate agents became obligated to tell consumers who they were working for, one large local company put "Working in Your Best Interest" in their letterhead. The problem was, it was a lie much of the time. Unless they had a written agreement with a buyer the company was not working in the buyer's best interest. Much of the time when they had an agreement with the buyer they turned to dual agency so the statement was still untrue.
Now we have a local company who uses TheHomeBuyersRealty.Com as their name. But who do they work for? Sellers. Right now they have a West side listing that is priced about 10+ percent over market. Sure not helping the buyers on that effort!

First we have lies about property, then lies on the letterhead, now lies in the company name. No wonder the public's perception of real estate agents and companies is so bad!

I had a conversation this morning with a top local real estate agent from one of the large traditional companies. She is thinking that "this will be the hardest year we've seen" in the real estate business.

She reported that they had some local appraisers visit their office meeting and it sounds like they had about the same view as what we reported here: http://annarbormichiganrealestate.com/?p=34

The bottom line: Mortgage appraisal values really drop until the comparable values drop. Comparable values won't drop until we see some well negotiated purchase agreements.

From being out looking at homes on the market it is very clear that values have dropped. (Prices have dropped.)

Two quick examples:
1. ~1,000 sqft ranch in nice shape on the West side for under $175K with a full basement and a 2 car garage. Seller bought about 2 years ago for ~$205,000.

2. ~1,800 sqft, 4 bedroom 2.1 bath colonial on the Northeast side for under $260K. (Walking distance to Pfizer!) 2 years ago this might have been worth ~$290K.

I was out yesterday viewing properties with a potential transferee to the area.

(Yes, there are certainly still people moving into the area!)

Consumer guru Ilyce Glink wrote a good article that was published in the Freep last Sunday, titled "Who represnts you in a home transaction?"

I couldn't find a copy on the Detnews/Freep site but it might be I did find it on her website at thinkglink.com.

Here is a link:

Who Really Represents You?





I'm always surprised when a local paper runs articles like this, because they get so much advertising from real estate companies.

We've felt very loanly as the only major real estate company in the area that seemed concerned about title companies having "close" relationships with real estate brokerages.

I've often been concerned about a company and/or real estate agent unilaterally deciding who the title company would be when we were helping a client purchase a home.

I even got the Federal Trade Commission involved about 10 years ago when one local company "insisted" that we use their choice of title company.

So now we hear that First American Title Insurance Co. has agreed to pay Ten Million dollars to settle allegations that they brought in business by making cash payments and other "gifts" to real estate professionals. These gifts included trips to casinos, riverboat cruises, tickets to special events, the whole nine yards.

The deals were basically structured as a $100 bribe per transaction that the real estate professional brought into the title insurance provider.

I'll say it again. We don't think buyer's agents or designated buyer's agents should take bribes or "additional compensation" from anybody. And, if they do, it certainly should always be disclosed to the buyer clients at a time where the clients can be involved in the decision making.

Labels: Buyer Agent, Designated Buyer Agent, Title Company