EBAY and Market Value

Happy New Year!

I've been shopping on Ebay for some pocket knives that I collect.  I am always amused when I get on Ebay.  I mean, you can find anything... nearly.  For whatever reason you can't buy and sell firearms on Ebay.  Anyway... I wonder how some of these sellers arrive at their price?   I suspect they are asking what they want for the item based solely on WANT.  Maybe they overpaid for a particular knife and they are letting that error determine their price.

The knife in red is one that I bought for $15 in an auction.  It has some scratches and there are many out there of this model despite it being about 30 years old.  So, it went for a market price of only $15.

I also bought the one in blue for $50 because it is very rare and in like-new condition.  Pretty easy to understand so far?  Of course it is.  Ebay auctions are a pure-free-market environment.  You want widgets, I've got widgets, how much will you pay based on how much you and the rest of the world want widgets?  Easy.  Ebay.

Nevertheless, sellers on Ebay frequently try to sell things for a price that has no reflection of market value.  I have seen the $15 knife for sale for $25-$50.  Needless to say, the buying population looks at that auction, and passes--the item ends, unsold.  We buyers move on to the ones that start at $0.99 and then bid them up to the "market price."

Market Value.  A simple but elusive concept.  When folks try to sell their homes, they sometimes forget they are selling one house among hundreds--the local real estate market.  If you have that rare "$50 knife" then you can expect a bit more.  But be honest with yourself.  If you have a "beat up two-blader" and there are 5 others out there just like it, you aren't going to hit your goal trying to get "$50" for it.

As a REALTOR, one of my most finely tuned and important skills is analyzing market value for my clients.  It starts before they go on the market, and it continues regularly until we are sold.  That translates into a short time on market for you and a greater feeling of success.  Very often accurate pricing also sells for a higher price than inaccurate pricing which has to be compensated for by many days on market and painful price reductions.

Sellers of used pocket knives on Ebay and sellers of real property in the NE Dallas Metro area have the same objective and the same reality: Market Value.

PS Any currently listed clients of JTOden Realty need not take this post personally.  We experience this phenomenon ALL the TIME and applying it to your own present circumstance, while possible fruitful and valid, is unintentional.  Besides, any client of JTOden Realty that is over priced, KNOWS IT.

Realtor Sentenced for Harassing Former Employee Online

Realtor Sentenced for Harassing Former Employee Online

Staging a Kitchen for Pictures

In the business of selling homes, you know that there's more to photographing a listing than pointing and clicking a camera. A little prep work is necessary.


Staff photographer JP Beato of the The Real Estate Center at Texas A&M offers simple tips on how to effectively stage and photograph a kitchen.

In just under two minutes, Beato covers proper camera placement and the types of kitchen items that should be removed before shooting (hint: nobody needs to see that dirty sponge sitting next to the sink).

Ten Tax Tips for Individuals Selling Their Home

When I see a list of tax tips from the IRS, I assume it' going to say,

1. Pay frequently
2. Pay some extra
3. Pay more

But instead, this list of tips may actually be beneficial to sellers who want to squeeze what they can out of their transactions.  If you have a gain from the sale of your main home, you may qualify to exclude all or part of that gain from your income. Here are ten tips from the IRS to keep in mind when selling your home.  Take a look...

The Internal Revenue Service has some important information to share with individuals who have sold or are about to sell their home.  In general, you are eligible to exclude the gain from income if you have owned and used your home as your main home for two years out of the five years prior to the date of its sale. If you have a gain from the sale of your main home, you may be able to exclude up to $250,000 of the gain from your income ($500,000 on a joint return in most cases). You are not eligible for the exclusion if you excluded the gain from the sale of another home during the two-year period prior to the sale of your home. If you can exclude all of the gain, you do not need to report the sale on your tax return. If you have a gain that cannot be excluded, it is taxable. You must report it on Form 1040, Schedule D, Capital Gains and Losses. You cannot deduct a loss from the sale of your main home. Worksheets are included in Publication 523, Selling Your Home, to help you figure the adjusted basis of the home you sold, the gain (or loss) on the sale, and the gain that you can exclude. If you have more than one home, you can exclude a gain only from the sale of your main home. You must pay tax on the gain from selling any other home. If you have two homes and live in both of them, your main home is ordinarily the one you live in most of the time. If you received the first-time homebuyer credit and within 36 months of the date of purchase, the property is no longer used as your principal residence, you are required to repay the credit. Repayment of the full credit is due with the income tax return for the year the home ceased to be your principal residence, using Form 5405, First-Time Homebuyer Credit and Repayment of the Credit. The full amount of the credit is reflected as additional tax on that year’s tax return. When you move, be sure to update your address with the IRS and the U.S. Postal Service to ensure you receive refunds or correspondence from the IRS. Use Form 8822, Change of Address, to notify the IRS of your address change. For more information about selling your home, see IRS Publication 523, Selling Your Home. This publication is available at www.irs.gov or by calling 800-TAX-FORM (800-829-3676). Links: Publication 523, Selling Your Home ( PDF) Form 5405, First-Time Homebuyer Credit and Repayment of the Credit ( PDF) Form 8822, Change of Address ( PDF)

Prices are down in the DFW Area

There.
I said. it.

House A -- Murphy

2008 = $199,900

2011 = $185,000

The thing is, people have been forecasting doom and gloom on the real estate market for years now.  Maybe they were well meaning sorts that wanted to slow down an out of control industry that was lending money to people who couldn't afford it.  Builders were starting up new editions anywhere there was open land.  REALTORS.... well, we brokers and agents just ride the waves, right?  Wrong.  We were all too happy to push folks in and out of transaction in order to cash checks.

But now, 3-4 years later, I can show you several instances of prices sliding.  Now, don't panic.  We're still only talking about a decline of less than 10% in the NE Dallas area.  But that's a real decline and there isn't any denying it.  Some areas will resist the drop in price better than others.  If you have updated your home regularly in the 5-7 years you've owned it, you won't see a drop but an increase in sales price.  But it won't be as much as you'd like.

House B -- Richardson

2008 = $140,000 (needed updating)

2011 = $160,000 (updated, should have been > $170K)

In a buyer's market you have more inventory than you do buyers.  More supply than demand.  Hey, I got a C+ in Economics at Blinn Jr. College (Go Buccaneers) and I leaned this stuff in between keggers, so you can too.  If you and three other guys are trying to sell the same thing to the same one guy, you have to make yours stand out.  So you fancy it up and you sell it for less than the other two guys.  Note I used the conjunction "and" not "or?"  I could have said "or" ...I didn't.

In a buyer's market you have to consider that every buyer wants more for the same.  You and the other two sellers have to offer more house, more amenities, more updating than each other.  One of the amenities is the price.  So, put in your granite, your slate, your butlers with shoe-shine kits, and lower the price.

Fear not, we are likely near the bottom.  But don't forget this advice because ours will not be an overnight change.  Dallas resisted the recession and we'll likewise ease into the recovery while Californians are screaming hallelujah---or whatever you scream when you're happy in California.

Want to know what the value of your home has done in the last three years?  Want to know what it is worth, today?  Email J.T. and he'll produce for you a detailed and logical market analysis for free and without any arm twisting run-you-out-of-your-house-pressure.

Move into Snoopy's House!

Super-cartoonist Charles Schulz, creator of the Peanuts cartoon, purchased his Santa Rosa, Calif. property from the Catholic church and married his second wife there in 1973. The chapel has been converted into a media room and gym, and the six-bedroom home still bears evidence of Schulz's presence. 

The office, complete with typewriter, aging television, and Peanuts art, has been left as a sort of shrine to the famed funny pages master. The rest of the Wine COuntry Estate is uber plush, including two large homes totaling 8,000-square-feet, two acres of well-landscaped grounds, and broad outdoor entertaining spaces, including a swimming pool.

The property is listed by Southerby's International.

Happy Independence Day! ...How to Make a Smoke Bomb

(From the wonderful pages of About.com)

The smoke bomb you would purchase from a fireworks store usually is made from potassium chlorate (KClO3 - oxidizer), sugar (sucrose or dextrin - fuel), sodium bicarbonate (otherwise known as baking soda - to moderate the rate of the reaction and keep it from getting too hot), and a powdered organic dye (for colored smoke). When a commercial smoke bomb is burned, the reaction makes white smoke and the heat evaporates the organic dye. Commercial smoke bombs have small holes through which the smoke and dye are ejected, to create a jet of finely dispersed particles. Crafting this type of smoke bomb is beyond most of us, but you can make an effective smoke bomb quite easily. There are even colorants you can add if you want to make colored smoke. Let's start out with instructions for the easiest/safest type of smoke bomb you can make:

Smoke Bomb Materials

sugar (sucrose or table sugar)

potassium nitrate, KNO3, also known as saltpeter (buy it online or you can find this at some garden supply stores in the fertilizer section, some pharmacies carry it too)

skillet or pan

aluminum foil

Once you've gathered your smoke bomb materials, it's easy to make the smoke bomb...

NEW LAW BANS PRIVATE TRANSFER FEES

From RECON at Texas A&M University comes this important legislative update...

AUSTIN (San Antonio Express-News) – Gov. Rick Perry has signed legislation banning private transfer fees attached to home purchases, the San Antonio Express-News reported yesterday.

Such fees throw a percentage of a home’s sale price back to the original developer each time the home is sold.

Under the new legislation, new private transfer fees will not be allowed. Developers who have existing fees on properties must file a notice of the obligation in county property records by Jan. 31, 2012, and update it every three years. If they fail to meet this requirement, the transfer fee is void.

Real Estate Center attorney Judon Fambrough and Research Economist Dr. Harold Hunt discussed private transfer fees on theReal Estate Red Zone podcast (episode 26).

Why am I updating a Dallas, Texas blog again?

Blogging... yeah, it seems a bit vain at times.  Did a NY Times writer really say, "Never have so many written so much to be read by so few?"  Hilarious!!!  I like the discipline of writing articles.  I like putting useful North Texas area real estate information out there.  I think that Facebook is quicker, faster, and certainly has greater traffic.

.  But, who knows... at least the brain is twisting, turning, and my clients can see that on my website I am eager to communicate to them about their real estate needs in Murphy, Rowlett, Richardson, Plano, etc...

I like my job.  Reminds me of a joke my Dad used to tell me, he got it from Henny Youngman.  ...An elderly Jewish man was crossing the street when he was hit by a car.  The paramedic shows up and says, "Are you comfortable?" The man says, "I make a good living."

Insight into why the economy is suffering...

(I had to have some satire relief today)
The United States is apparently built on ancient Native American Indian burial grounds.  Yup, we're cursed...

What's your budget, Richardson?

How about $415,000?   ...Got it:

. 

Less?  Ok, what about $175,000?   ...Bamn:

 

Discount Realty! Selling for 1% 0% ...and even less!!!

7% seems about right to me.  Does it seem too high to you?
What about 6%?  5%?  Is there a standard rate in Murphy or Richardson?  What about 1%?  What if the 1% is really 4% and *YOU* have to do 80%?
Would you believe that the way discount realty is practiced by most licensees is illegal?!


Discount realty agents lure you in telling you they will put your house on the MLS for $500, or they'll sell your house for 1% and then that really means you pay 4% and they give 3% to the buyer's agent.  Trouble is, that every listing agent under contract to sell your house is obligated to a minimum service requirement via the State of Texas who issues their license.  The Texas Real Estate Commission requires licensees to "inform the party of material information related to the transaction, including the receipt of an offer by the broker, and answer the party's questions and present any offer to or from the party. The bill prohibits a broker who represents a party from telling another broker to negotiate directly with the broker's client."


Wow!  I can find you a listing on the MLS any day with the opposite of that in the description.  They often say, "contact the seller for more information" or, "send all offers to 972-555-5555" --which of course is the sellers fax line or an e-fax that the seller checks rather than the listing agent.


So what?


Fair question.  Folks, you get what you pay for.  It is conceivable that your transaction will never get off the ground with limited service.  It is completely reasonable that a licensee fighting violation charges or trying to cover his ASSets might not get your home sold and closed.  You get what you pay for.


JTOden Realty is an independent real estate brokerage so we set our fees ourselves.  Each listing and each buyer is unique therefore, each fee we collect is reflective of that individual buying or selling situation.


What is consistent is our commitment to OUR minimum service standard: We represent our clients like they would work if they had the time, inclination, experience, and passion to be the very best Brokers they could be.

Is it Cheaper to Rent or to Buy?

I guess that depends on where you live.  

   In Dallas and its suburbs, you should buy.  However, if you move to Fort Worth, maybe you should rent?  New York City?  Definitely rent.  In fact, Inman News reports that It is cheaper to buy a home than to rent one in 39 of the nation’s 50 largest cities.  Inman cites a a quarterly report released today by real estate search and marketing site Trulia.

   The folks at Trulia have produced a rent vs. buy index that compares the median list price with the median rent on two-bedroom apartments, condominiums and town-homes in the 50 most populous cities in the U.S. listed on Trulia.com as of April 1, 2011. 

   Ken Shuman, Trulia’s spokesperson, stated, “With home prices nearing a double dip and more foreclosures expected to flood the housing market over the next two years, the decision between renting and buying a home across most of the country has clearly moved in favor of buying.
   “As we head into the summer buying season, those looking to buy a home should be encouraged by improvements in the market and feel optimistic about their chances of finding an affordable home — much more so than in previous years.”

   A price-to-rent ratio of 1 to 15 means that it’s much cheaper to buy than to rent in a particular city. 

Top 10 cities to buy vs. rent:

Rank	City	State	Price-to-rent ratio
1	Las Vegas	Nev.	6
2	Phoenix	Ariz.	7
3	Arlington	Texas	7
4	Fresno	Calif.	8
5	Miami	Fla.	8
6	Mesa	Ariz.	8
7	Jacksonville	Fla.	9
8	Sacramento	Calif.	9
9	Detroit	Mich.	10
10	Omaha	Neb.	10

Source: Trulia.com

   Inman reports that this index considers the total cost of homeownership compared to the total cost of renting. Calculations for total rental cost include rent and renters insurance.  The total cost of homeownership was highest, compared to the cost to rent, in New York; Fort Worth, Texas; and Kansas City, Mo.

Top 10 cities to rent vs. buy:

Rank	City	State	Price-to-rent Ratio
50	New York	N.Y.	39
49	Fort Worth	Texas	30
48	Kansas City	Mo.	22
46	Memphis	Tenn.	20
47	Los Angeles	Calif.	20
43	San Francisco	Calif.	19
44	Boston	Mass.	19
45	Seattle	Wash.	19
42	Portland	Ore.	18
41	Oklahoma City	Okla.	16

Source: Trulia.com
http://www.inman.com/