Patti Lora

With all the news flood about Michael Jackson's death and funeral plans, little has been said about a legislation that was passed in the House of Representatives. The Waxman-Markey Cap and Trade Bill or also know as the National Energy Tax bill is now in the Senate which has a super majority which will drive very hard to push it through and get it to President Obama for a signature.

The premise behind this legislation is that the United Estates needs to take a leadership in the world regarding the reduction of green house gasses. It is a set of measures that is supposed to reduce our carbon emissions and help the world curb the eminent effects of "global warming." It is supposed to cut the energy consumption of homes by 62 percent by 2029. However, President Obama said "make no mistake, this is a jobs bill."

Whether you believe in global warming or not, there are some facts about this legislation that will affect you as a home buyer, home seller, or home builder.

New Home buyers: Saving up to buy a new home? Count on saving longer. The new legislation will require all builders to adhere to the new costly California building codes. These codes require builders to build "green" houses which can significantly increase the cost of building.

Home Builders: If your state does not agree with the Federal law, the Federal Government can assess huge penalties. Even if you invest in complying with all the rules, the requirements can be added unto by "consensus" of bureaucrats.

Home sellers: Do you think this is a tough market? The new legislation would require you to have an "energy audit" that could penalize you for older windows, original fixtures, and dated appliances. These are all things that are usually negotiated between the buyer and the seller but now, the seller would be mandated to make the changes. And who is conducting this "audit"? A government bureaucrat! Hope you are not selling your home during election and you have the wrong political sign on your yard!

The bill is so large, nobody has had the time to completely analyze the scope of government intrusion. On the last day of discussion of the bill before vote, a 300 page amendment was added that possibly furthers the regulatory control over a sale of a house.

More Reading:

- The Waxman-Markey Cap and Trade Bill Will Control Housing Standards

- Waxman-Markey Cap And Trade Will Make Homes Cut Energy Consumption 62 Percent

- Speaker Pelosi's National Energy Tax: More Mandates, More Regulations, More Costs

As a Realtor® I have the benefit of being able to look at the Multiple Listing Service (MLS) database. I can tell you that when you see homes that have been on the market for a long time, there is one common thread that puts them together in the category of hard to sell houses.

Price!

If the home isn't priced to sell, it's not going to sell. It's that simple. Now here is the tricky part, how do you properly determine a good price to sell your home? To answer that, lets first look at the basic common problems with pricing:

• Price per square foot is far above other houses selling in the market.
• Price per square foot is far above what houses have sold for in the last six months.
• Price per square foot is in par with other houses in the market but condition of the house is far below the competition.

Let's take a look at number 1: This usually is the result of two things. The owner added many upgrades to the house such as new additions, pools, fancy floors, appliances, etc. and their investment has priced them out of the market. In other words, they have made the house too nice for the neighborhood. The second reason would be that the owners did a lot of "upgrades" themselves and their pride inflates the real value of the upgrades. Some of these upgrades could be ill advised yet the owners think it was the best thing they could have done for the house.


Number 2: Selling above what has sold in the last 6 months is usually evidence that nobody did a proper Competitive Market Analysis or CMA. This really requires the involvement of a Realtor® like me because we have access to information that home owners typically don't. The CMA also has to properly account for differences in conditions and features of houses used to make the comparison.


Number 3: When it comes to the condition of the house you need to consider two things; perceived condition and actual condition.

Perceived: I'm sure you have watched the show Design to Sell. There are many things that send signals to a prospective buyer to run! Wild colors, extreme personalization, clutter, uncleanliness will affect the thoughts of the buyer. Even if your house is priced right, buyers sometimes can't see themselves in your house because they can't see the house past all your personal belongings!

Actual: Your house maybe priced right according to the market but what if it has real issues like foundation problems, damaged roof or siding, worn out carpets, etc? The owner has to be willing to either fix these or adjust the price accordingly.

In conclusion, it helps to have a Realtor® that is going to be honest with you. They may not tell you what you want to hear but it is also important that you are up front with them. The most helpful thing I find is when an owner tells me something like this: "I owe $100,000 on this house and I want to walk away with at least $15,000." This gives me clear direction and I can tell them exactly what to do to achieve such a goal.

This is a copy of a blog entry in my main blog www.iwillfindahomeforyou.com

It's all about perspective. Someone in California can't believe what $300,000 will get you in San Antonio but most people in here are looking for houses that are under $150,000. The problem is that everyone is looking for this price range and when you get down below $120,000, most of the inventory available are old houses that need a lot of work. It can be a very frustrating experience for someone who is trying to get a "deal" in this "buyer's market." Add the whole lending situation and you have a recipe for a lot frustrated, disheartened buyers.

I'm not sure when this is all going to turn around, but if you are looking for a home and your budget is below $150,000, here are some things you should consider:

- You have to be willing to make some compromises (Older homes need updates and repairs)
- Forget about $0 down payment, it does not exist any more.
- You have to prove your income, no more stated income loans.
- Be ready for underwriters to scrutinize everything, even if you have good credit.
- It's not your house until you sign the documents and you get the keys.
- Do not make any other major purchase until you buy your house.
- Do not open any credit accounts no matter how small.

This is a copy of a blog entry in my main blog www.iwillfindahomeforyou.com