So I’ve been blogging for over four years about homes at Mueller Austin, and I’m coming up on four years living there. It was time for a change, so I have moved my future blogging efforts to a new platform. I’ll still talk about home prices, listings coming up and the new homes being built. It’s just time to host my content elsewhere.
There’s a shift in the development that is happening with the 2012 Section 6, and I’ll write more about that over there. For now, here’s a picture of me outside Lake Park in Mueller, and a large image with my new website address. You can click on it and head on over there for the latest and greatest. Thanks!
At the start of September 2012, HEB and Catellus made their announcement ending literally years of uncertainty as to who the grocery tenant would be at Mueller. The grocery has long been a hot topic for current and future residents – the Neighborhood Association meeting that Greg Weaver attended two years ago to discuss grocery and town center plans was heavily attended. So we’re excited there’s a store, where is it?
It’s going to be in the market district, which doesn’t exist yet beyond the gleam in a master development planner’s eye and a few diagrams. It’s going to be on the outskirts of the neighborhood. The original plan saw a grocery co-located with the Town Center, but it split off to Berkman and 51st Street to allow surface parking. America isn’t apparently ready for small town grocery yet.
So it will be easily accessed from I35 via the 51st Street exit – which places it convenient for northerly areas like Windsor Park and University Hills whose nearest HEB is the one at Springdale Plaza. It’s also an easy route from the bulk of the residential part of the neighborhood – Berkman only extends as far as Simond Avenue (venue for the Mueller House Condominiums) right now, though has been planned as a major thoroughfare – even having provisions and scale for a streetcar, should that transpire.
Personally, I like the idea of a HEB. They’ve given me free bananas and bagels every time I’ve finished a running race in Austin, and I like the mix of everyday stuff like Diet Coke along with the Central Market organic range. And they’re local.
Garreth Wilcock is an expert in homes at Mueller Austin and represents buyers and sellers of residential real estate there. See all new Mueller homes for sale at his other blog.
A friend of mine is refinancing his home due to the all time record mortgage rates right now. He isn’t using my favorite Austin lender which is a shame, and his appraisal came out jaw-droppingly low. I mean, not even in the ballpark of what I think his home is worth.
The interesting thing I learned at a recent class is that real estate appraisals are allowed to vary by 3% and still be considered the same. Crazy, but a product of the inexact science of home valuation – a home has so many variables that affect it’s market value – what someone is willing to pay for it – number of rooms, finish, construction quality (and perhaps more insidiously – the apparent construction quality), direction the lot faces and a multitude of other factors.
So it got me to thinking. I recently referred a client to another agent who better served his market, and in selling his home, the agent recommended getting an appraisal before choosing the list price. It makes sense right – if the buyer is going to get a loan (over 80% right now do) then their lender is going to get an independent appraisal of value, and this has to meet the contract price for the transaction to move forward smoothly. Now, the lender isn’t going to use the appraisal the seller paid for – they have to order an independent one. But it’s an extra data point that can help inform pricing.
Why don’t you just choose the list price the agent or the seller wants? For a home to be in the market, it has to be priced appropriately. Over-pricing in a flat or down market leads to worse results for a seller. And even if you get a buyer willing to pay over market value, their lender’s appraiser won’t condone it.
Also, not all agents like selling homes, some just like listings – homes for sale. I know that’s not ethical, but some agents like to have a sign with their name on it sat on a busy street for any prospective buyer to see, along with a giant phone number for prospective buyers to call. If the buyer doesn’t buy the overpriced home on the busy street, the agent whose face appears on the sign can sell them one of the 11,000 other homes available. And the longer that piece of personal marketing is out there, the agent gets to meet more and more buyers. The seller just gets relegated to second, third or fourth priority.
If there are three agents being interviewed to list a home, most sellers will be flattered by a high listing price from Agent A, rather than a realist selling price from Agent B. So that impacts the listing price that some agents will work with for a given home. As it is put so neatly in the Appraisal Tips For Consumers paper:
“Unlike some other real estate professionals, the appraiser performs a professional service for a fee rather than for a commission contingent on the value conclusion, the approval of a loan or the eventual sale of the property”
So should you get an independent appraisal as part of listing your home for sale? I think it’s a vital and independent data point. Whether you choose to do so before interviewing an agent is another matter.
Can your agent use the appraisal in your marketing? If it’s to your advantage, there’s nothing to say you can’t say “recently appraised at $xxx” and add the appraisal to your marketing materials. One of the big problems I see with people trying the FSBO approach is that they don’t have access to comparable sales data and don’t price their homes appropriately. If you’re going to sell your home FSBO, get an appraisal and put the sales price information out there.
Garreth Wilcock helps people sell their Mueller homes. He is an EcoBroker which means he has additional training and experience in helping people buy and sell green homes, and has a higher than average interest in the environment and cardboard recycling
Negotiating a home sale is a mixture of balancing risk, terms and contingencies. OK, so the title is a little bold, but would you have read the original post if it was titled Ramifications of The Third Party Financing Addendum For Credit Approval? Probably not, but the addendum is one of the most widely misunderstood forms used to buy homes in Texas.
As a seller, you want to minimize contingencies – “get out clauses” for the buyer, so that you can be more sure your home will actually sell. As a buyer you want as many escape clauses as possible. There are several major and common reasons a transaction for a home purchased with a loan will not close:
1. The lender’s appraiser values the home lower than the contract price – and won’t lend any money. There are obviously ways around this, beyond the scope of what we’re talking about here – get in touch if you want to know more.
2. The buyer doesn’t qualify for the financing – they don’t get credit approval. The lender would possibly lend on the home, but not to the buyer. That’s why it’s vital to obtain a pre-approval letter (different from a pre-qualification letter by a whole bunch) as a buyer, and for the seller’s agent to verify that the lender letter is legitimate. (As a client of mine said recently, anyone can get their brother-in-law to write a lender letter)
So the Third Party Financing Addendum only talks about the second item. It gives the buyer a time line in which to fully apply for the loan with the terms laid out in the added. This is the buyer’s credit approval, nothing to do with the home. Many agents believe that this contingency period has to include a number of days for the entire loan to be underwritten (including the home, title work, and buyer’s credit). It doesn’t. This portion just covers the buyer, and can be turned around by a competent lender in under one business week.
So as a seller, don’t accept an unwieldy amount of time in the 3rd party financing addendum – time is of the essence, and it shouldn’t take 28 days to get a buyer approved and underwritten. That’s the number of days I see many agents putting in by default.
So what about the appraisal – that’s a big contingency – when does that happen? Unless the contract specifies a date for the appraisal, then the buyer can back out of the contract due to a low appraisal at any time before closing. That’s right, the purchase contract (not the addendum) specifies that the contract is contingent on appraisal (and title etc) throughout.
So as a seller, to ensure a timely appraisal for a far off close date, you might add some additional language to the contract to demand an appraisal quickly. Otherwise you could be in contingency limbo for a long time.
Garreth Wilcock helps clients buy homes at Mueller Austin and beyond.
Does the cash buyer of a home at Mueller get a better deal than the buyer purchasing with a loan? I took a look at the stats for Austin – where 764 out of 4179 MLS sales in the last 12 months were cash buyers, (18%) and compared it to the market at the old airport, and it turns out that although there are a higher proportion of cash buyers at Mueller, it is not a statistically significant number.
Follow the link to read more about the implications of selling to a cash buyer.
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It’s been quiet here lately, as I’ve been working on my new homes at Mueller website. I’m not dead, I’m just relaunching! More news and updates about the Mueller market in the coming days.
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If vieiwing available houses is like dating, and buying is like making a commitment, as a home seller, you don’t want buyers to be asking the equivalent question to: “Why are you still single?”.
Yesterday I met with the seller of a home in Windsor Park and he asked about the possibility in asking more than his house is worth, “leaving some negotiation room” in the list price. My response was that the best results come from putting the list price at or ahead of the market value, and that the market is to all intents and purposes somewhat flat in his area.
- If house prices are shooting up, I advocate choosing a list price above the current market price so that in 30 days, the market will catch up with the list price.
- In a declining market, you have to price below current market value - you don’t want to be chasing the market down, and never quite being at a price that appeals to buyers, lowering and lowering your list price continually.
- In a flat market, you need to price at what the home will sell for. It brings in more buyers, and increases the chance of multiple offers – a situation which tends to lead to better results for the seller’s bottom line.
So in today’s flat market, why not price it above the market and drop the price if no-one buys? (This is a common question) The short answer is “market stigma”, as if a home is on the market for too long, buyers start to think, “why has no-one bought it yet?” or “what’s wrong with it?”. Regardless of whether the local housing market is peaking, troughing or stable, buyers assume (rightly or wrongly) that a seller will take less for the home than the list price if the number of days on market is high.
I looked at MLS sales for 2005-2010 for single family homes in Austin listed between $200,000 and $400,000, and pulled some statistics which concur with this idea:
As you can see, the sales price to list price ratio goes down as days on market increases. This is true for the variety of market conditions we’ve seen here in Austin real estate in five years. If you look at the same period for homes that are on the market for a week or less, the average sales price to list price ratio is 99.61%.
So, if you don’t want homebuyers who are dating your home to ask “why is it still single?” in today’s market, list the home at the price you expect to sell at. Thanks to Davide for giving me this analogy.
Garreth Wilcock is a Realtor in 78723. 512 215 4785
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You know, moving was hard enough before the economic downturn. Now, aside from everything else you have to do, you have to strongly consider the economic factors of your move more than you used to. It’s no longer just a matter of finding the best looking house in the classiest neighborhood you can: you have to make sure that you won’t have to pay too much to live day-to-day and that you’ll actually be able to find a job where you move. So strap yourself in, we’re about to take a tour of Midwest and Austin real estate.
Where Can I Live Cheaply? The Midwest!
If you find a place with a low cost of living, you can make sure that every dollar you make is able to go the extra mile. In that case, heed the words of Professor Robert Helsley of UC Berkeley, who says that the Midwest is so cheap because the entire area is landlocked. However, most people don’t even expect to get waterfront properties nowadays (especially with a bad economy), so you can go ahead and turn this into an extra benefit for yourself in order to get a lower price by not even considering the coast in the first place. If you’re really keen on having a low cost of living, you also might want to consider St. Louis, which has the lowest cost of living in the entire country.
Where Can I Find a Job? Texas!
By moving to a place with a good job market, you’ll be able to ensure that you’re not stuck in unemployment limbo for too long. In order to find a strong economy, you should check how many major corporations are in your prospective city and state. These companies bolster the economy around them and help provide lots of job openings that you can take advantage of. This is why Forbes says that “three of the best cities to earn a living” are “Dallas, Houston and Austin,” as Texas has 57 Fortune 500 companies. The only other state in the country that can match that is California, but it is significantly more expensive than Texas. The reason why those three cities, in particular, are on the list is that Dallas has 15 of those companies while Houston has 38. Of those three cities, Dallas has 15 of those large companies while Houston has 38. Austin only has 1, but it has a vibrant startup scene and is also the state capital.
What’s My Best Bet? Texas!
If you think that both a low cost of living and a strong job market are important, you should go ahead and look at Texas. Texas has a low cost of living across the state to accompany its stellar corporate presence and job market, making it the best place to move in the current economic climate. If you’re looking just for a low cost of living, the Midwest beats it out, but, for most people, Texas is currently the place to be.
James Kim writes for Austin Real Estate service Homecity.com. HomeCity combines powerful online Austin MLS search technology and other online tools with personalized real estate services to provide clients with the knowledge they need to make the right buying and selling decisions.
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A few years back, a client from California was convinced they were moving to Fort Collins, Colorado. They ended up moving here based on the recommendations of so many Austin advocates in LA and one of them wrote about the experience for the Statesman. They had initially contacted me as they’d seen some of my writing about Mueller homes for sale, and thought that my neighborhood might be a good fit for them.
I would describe Dave as a green enthusiast (he rides an electric bike) and he was particularly interested in a walkable neighborhood and the sense of community which pervades the development. As noted in his article, he and his wife planned one reconnaisance trip in the triple digit dog days of summer, just to see if they could survive the oven-like conditions.
The answer was “yes” and the answer to the question, “should we move to Mueller?” was no. At the time, the lack of established trees was a deal breaker. If we hadn’t been scurrying for shade all the time, it might not have been so apparent that the trees were so sparse. We found something ideal in the neighborhood of Scott Felder homes called Independence, where more clients who I’d met through Mueller writings had found their home around the same time.
I guess the morals of the story are:
- This city has so many advocates around the world that it often ends up on people’s relocation lists – see Dave’s article for more details of the cult of Austin.
- Austin is freakishly hot – if you’re considering a move, check it out in summer as well as the mild winters.
- Mueller isn’t for everyone, and I can certainly help people identify other neighborhoods that do work for them.
Garreth Wilcock is a Mueller Realtor who helps people buy and sell homes throughout Central Austin. 512 215 4785
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If you’re unsure how to pronounce Mueller Austin, things may have just become a little more complex now that Betty is in residence. She’s the Magnetic Cow from the Austin Cow Parade, and she is grazing on the plaza outside the developer’s information center – by the Browning Hangar and Lake Park. Maybe we should be saying “Moo-ller” now too.
The 2011 Cow Parade benefits the Dell Children’s Medical Center here in the neighborhood, and each of the 100 cows around Austin will be auctioned to raise funds at the end of October. The average price for a cow in the US has been almost $10,000.
The exciting thing about the Magnetic Cow is that she’s somewhat of a blank canvas – she is coated in a material that allows the public to bring their own magnetic art and attach it to her flanks. I bumped into Dee DesJardin while I was over there, and she explained that the artist (Jill Bedgood) had suggested magnets with small bases (due to the curvature of the cow) and thin ones (presumably to keep the weight of the objects from dragging them down to Betty’s udders.
I’m wondering what the creative types will come up with, and I’m excited to see how the artist’s blank canvas gets filled in the next few months. Maybe we can bring some white magnets to make her into a friesian, or put magnetic photos of ourselves all over her. I have some magnetic googley eyes that I’ll be taking over there. I think I’ll leave the Realtor fridge magnets at home though!
Garreth Wilcock helps people with Mueller Austin Homes for sale. 512 215 4785