Christopher Hart

In today's market that seems to be flooded with homes and now deals, selling your home is becoming increasingly difficult. In one of our recent blogs PRICED...TO SELL vs. FOR SALE! What is YOUR home? We discussed some market proof techniques to selling your home. Well, the reality of that particular situation is that SOME homeowners JUST CAN'T implement that technique. Well, if that's the case, then we need to look at some "NOT-So Risky" Alternatives. My Answer is the LEASE OPTION! The Lease Option option is one of the least riskiest alternatives to selling in ANY market.

In MY Opinion...I see the Lease Option as one of the best investment strategies for investors due to the fact that it is the least riskiest. I view the Lease Option to be the least riskiest due to, if structured properly, you are virtually free of all risk. Essentially, the Only risk that one would assume is the fact that someone lives in their home that does not own it. Basically called a Lessee (Someone who received a lease on a property). I choose not to call them a tenant because the person that you are looking to emplace in your home on the lease option option is NOT a tenant. To me, a tenant is someone who looks to just rent your home with no intention of purchasing the car, therefore has a different mentality when living in your home. Tenants usually only have to put 1-2 months (2 months max due to state regulatory laws based on the state you live in. Here in SC, a landlord is only allowed to take maximum 2 months security deposit). On a lease option structure, there are no regulatory laws that restrict you from charging as much as you want on what we are going to call the NRLOCF (Non-Refundable Lease Option Consideration Fee). This is a FEE (non refundable) that allows a "Lessee-Buyer" the OPTION to purchase the home in a specific period of time. For me, I usually charge a certain percentage of the agreed upon purchase price.

Now, there are a few different factors that must go into consideration when properly structuring a LEASE OPTION that will properly protect you the seller.

Here's the one thing that makes the lease option the best viable option when one is unable to sell their home due to personal situation in a declining market. 1. You provide a means of housing for a low downpayment to someone who WANTS to own a home, but just can't due to a fe different reasons which put you in a position to control the price. 2. You get to still own the home and wait out market conditions to sell. 3. The Lessee -Buyer has a Buyer's mentality so they are more than likely going to take care of the home like it's theirs.

Here's the best analogy that I can best assimilate a Lease Option structure to...Leasing a car. You drive it off the lot, you tell everyone it's YOURS...You brag about it, YOU maintain it, YOU pay for everything and after the time period agreed upon, you can purchase the car. If you choose not to, you walk away from everything that you have invested in the car and the dealer makes out in the end...It's the SAME THING with a lease option. The lessee-buyer agrees on terms with the lessor-seller, moves into the home, tells everyone it's THEIRS, they pay for all that happens within the home & anytime during the agreed upon time period, they can purchase the property, but should they decide to walk away, they walk away from everything they have invested in the property...including the NRLOCF (that remember was a % of the sales price). This is where you want the payment to be a bit hefty so they have to think twice about walking away, but you want it to be low enough where it benefits them to lease option the property rather than purchase something else. For more information and a complete detailed explanation on LEASE OPTION structuring or assistance with Homes for Sale in Myrtle Beach or Myrtle Beach real estate in general, feel free to contact me anytime.

Christopher.Hart@Hartrealtyonline.com

843-903-HART (4278)

In some of my recent blogs, you might have noticed that I mention a home being listed TO SELL rather than FOR SALE. For those of you that have asked me what the difference is, here it goes...

As a listing agent, it is my intent to SELL a clients home as I would also like to think that the client would like their home SOLD as well. That's a fair assumption to make right? Well, this is where my difference between the two come into play.

Many time an agent will go on a listing appointment and somehow find themselves listing a home higher than either THEY Care to or The Market will bare. There's many reasons why this happens (i.e. Seller needs more $ out of the sale, the agent isn't very trained on SELLING homes, the agent knows the sellers needs so therefore tailors the price to the sellers needs just to get the listing, etc.). These are just some of the reasons. Now let me caveat something here. I am by NO MEANS bashing other agents in the Myrtle Beach real estate marketplace. I only speak of what I hear and see. I can also speak from experience as I have been guilty in the past of what I speak of.

So, when an agent finds themselves in a situation where the home is "OVERPRICED" we can then categorize the home as PRICED FOR SALE. What I mean by this is, the home is obviously FOR SALE, but what we have to ask ourselves is, at the home's current price, is the home going TO SELL? This is where you have to be realistic. If you find yourself saying probably/maybe not, then your home is PRICED FOR SALE meaning that it will most likely just sit on the market forever, clog the market with supply, distort market statistics, & make (you the agent) or (your agent) look bad and quite possibly make the home look unattractive to buyers as they will think something is wrong with it as to why no one wants to buy it!

So here's the answer! Pricing your home TO SELL! Pricing your home TO SELL means that you are pricing your home in accordance with what has been established as market value "What Buyers are willing to pay in TODAY's market." Though a bit more work for your agent, this method is much more effective for agents and sellers alike because if the agent is selling homes, he/she is making $, satisfying clients, getting more listings, selling more homes, building a reputation, and so on and so forth. YES, IT'S AS EASY AS THAT!

How is this achieved? Through market research and analysis. Agent should always prepare a CMA. Some agents call them Comparative Market Analysis'...I call the CUSTOMIZED Market Analysis (check previous blogs for further explanation). In conducting the CMA, the agent should prepare the potential seller a detailed explanation as to HOW they arrived at the priced they recommend. Some of the information that needs to be taken into consideration is: Homes SOLD similar to YOURS in YOUR neighborhood (or within a 1 mile raadius), How long ago did they close? How long were they on the market? What were market conditions like during that time period? How many price reductions happened prior to receiving a contract? What is your current competition (price, quality, length of time on market, price reductions, etc)? After taking all this (and more) into consideration, an agent should be able to tailor what the listing price SHOULD BE based on YOUR motivation TO SELL (how soon do you need to see your $, what Stage of Seller's Motivation are you in?).

Now many will say that this doesn't always work because of market conditions changing, lack of buyers, lending procedures, etc. They're right~ Nothing is ever fool proof, but what you and your agent will need to discuss is price reduction plan (i.e. When will the 1st, 2nd, 3rd price reductions take place and for how much should the home not go under contract in X amount of time). Why is this? Remember what we said was market value..."What buyer's are willing to pay for a home in TODAY's market" so if you are getting showings and no contracts, then buyer's ARE NOT willing to pay your asking price and the rule of thumb here is to continue to reduce until the home goes under contract!

Now, we can go on and on with this as to how some homeowners can't, aren't able to, etc. reduce their homes and whatever else everyone is running around out there saying. Here's how I look at it...YES YOU CAN~! You just choose NOT TO! If you are serious about selling your home, this is the PROVEN method to use. This WILL SELL YOUR HOME!

Hopefully you will be able to see the difference between PRICING your Home TO SELL vs. FOR SALE and will keep this in consideration when it's time to sell your home. If your home is currently listed and is not getting contracts or showing, please take a look at this plan and see if it works for you...I assure you that if you put together A PLAN based on YOUR NEEDS, you will find that this plan works for YOUR NEEDS and TIMEFRAME!

For more information on Homes for Sale in Myrtle Beach or Myrlte Beach Real Estate Market, please feel free to contact me!

Christopher.Hart@HartRealtyOnline.com
843-903-HART (4278) Office
www.HartTeam.biz

As agents, we all know that pricing homes FOR SALE is one of the most important aspects of our job and profession, but yet, why do so many agents do it wrong sometimes? (including myself!)

The consensus among agent in the Myrtle Beach real estate market lately is that they "are not taking anymore over priced listings!" Haven't we all heard this for the longest time now? We seem to hear this in stable markets, slow markets, etc... So yet, WHY do we as agents continue to overprice homes?

The thing that gets me is agents will say..."I'm not taking anymore over priced listings..." Which leads me to believe that they KNEW taking the listing from the get go that the listing was overpriced! Here's the problem I have with this. 1. Are we properly representing our clients by overpricing the listing? Aren't we obligated to represent our clients best interest and market the property TO SELL not FOR SALE? 2. Aren't WE supposed to be in control with our clients? Why do we let our clients control the price of the home?

There are a lot of questions that I can ask when it comes to this topic...but here's the bottom line (in my opinion):

We as agents are trained that "LISTINGS" is where the $$$ is. He/She with the listings will be the one who makes the money...survives in any market...it's about #'s so take them all...etc. Any seasoned agent has heard "them all" when it comes to what brokers are saying when training their agents. I can argue FOR and AGAINST most of these training techniques, but most importantly, I FEEL it boils down to what our Fiduciary duty is to our client and once again it's...."TO REPRESENT OUR CLIENT IN THEIR BEST POSSIBLE INTEREST WHEN SELLING THEIR HOME!" Does this mean that we let THEM price the house and file the listing under "get em all and let them bleed out then lower the price to where YOU think it should be?"

Think about...Agents we spend more time and money dealing with "pain in the butt" clients who's homes don't sell for this very reason, so why not just price the home TO SELL rather than just FOR SALE! If you price it right at the get go in accordance with recent sales and current competition, then your chances are greater for the property TO SELL, which means you are making $$$, which means you are reducing the amount of "PAIN IN THE BUTT CLIENTS", getting more listings (because you are now being known for selling listings rather than just HAVING alot of listings, and the process starts all over again!

If you become the agent that properly prices the home TO SELL vs. FOR SALE and you become an agent that is selling homes in the Myrtle Beach real estate market, you will find that you will not become thaat statistice that every real estate agent is fearing right now...The one who can't even afford to pay their license renewal fee!

THE ANSWER...Price the Home TO SELL rather than to just sit FOR SALE!

As the real estate market countrywide (not the lender) has transitioned significantly, I assume most agents across the board are experiencing an increase in SHORT SALE type transactions. Here in the Myrtle Beach real estate market, short sales are a prominent part of what we as agents are experiencing. It seems today that EVERYONE is looking for that easy "bailout." Banks, Lending institutions, The "Big 3" automobile companies, marriages, and now homeowners. Why, BECAUSE THEY CAN!

Without getting too much into that ramble, the reality of the market is SHORT SALES are everywhere! What concerns me as a Broker-In-Charge and listing agent is, when other agents in the Myrtle Beach real estate market call for an appointment on one of my listings and ask ME to explain what a SHORT SALE means to them? I WAS SHOCKED! This agent didn't sound like a "spring chicken" either. Whether or not she was a "rookie" in real estate or not, I find it very hard to believe or understand HOW she has never heard of nor understands what a short sale is?

In having a few "SHORT SALE" listings, I've found that there are many agents out there that aren't educated on the understanding and formalities of Short Sales. I ask myself why? Is it that Brokers/Sales managers aren't taking the time to train their agents? Do they not know themselves? Are companies giving up on their agents? Do agents not care anymore or have they given up themselves? These answers go unanswered for now.

HERE's my point! I received a letter in the mail at our office the other day from a local attorney offering a FREE SHORT SALE seminar. "We can come to your office, or you can come to ours!" I am sure that I am not the only office that he mailed to...WHAT A GREAT IDEA! Now, it's a NO-Brainer! My agents will be trained up to better understand the process from the attorney's point of view. GREAT! I've even invited other agents with the hopes that others will learn the process so as to when they submit offers on my Short Sale listings, they too will know what's going on so I don't have to do all of the work!

So for those of you in other markets that find yourself in the boat of the "unknowledgeable" in SHort Sales...Get with your Broker/Sales Manager and ask them to train you. If they are unsure, ask them to find a local attorney or subject matter expert to come into the office and train you on the specifics. If they don't...Transfer to another agency...This is the reality of our market and if your managers arent' taking the time to train you on what's selling in TODAY'S market, then THEY are setting you up TO FAIL! Thus they and everyone else will blame it on market conditions...It's not the market, it's the agents failing to change with market conditions and educate themselves!

happy Selling...Good Luck~

Ok, so I come at you with a little bit of disturbance with this Blog...Owning a myrtle beach real estate company that handles property management, I get phone calls all too often from "investors" who own myrtle beach real estate who are frustrated with the fact that their myrtle beach real estate investment in non-performing (they are loosing money). For some reason, they seem to think that changing property management companies is the answer. Ok, let me stop here...Most of the time it is, but for this discussions sake...stay with me, you'll see where I am going with this!

So after my question and answer session with these "investors," I typically come to the conclusion that they just DID NOT purchase the property correctly! What I mean by correctly is, they never had a plan, they bought at retail, and think that because a bank was lending to them at 95-100% LTV, that somehow the endstate was going to be that this myrtle beach real estate investment was going to perform (make them $$$) for them. In this case...it can...with more than 20% downpayment.

Here's what I am getting at! INVESTORS, there is a term called "Buying RIght." What we mean by this is 1) Have a plan that outlines what you are trying to accomplish and how you need to accomplish it 2) QUIT BUYING PROPERTIES RETAIL. RETAIL is buying properties listed on MLS for "The Market Value." Just because you get 5-8% off the asking price only means that you got the property just under what was marked up to cover commissions. When you are ready to purchase real estate, you must know your market area (like the back of your hand) and go find the distressed owners that HAVE TO sell. The HAVE TO sellers "have no other choice." They are at the point they have no other options and typically this is where you find the best deals. Quit having your REALTOR friend searching the MLS for deals...these aren't deals. You need to get "down and dirty" and find "THE DEALS" via street. Set out bird dogs, equip them with your buying criteria, and watch the deals start coming in. Negotiate real well and before you know it, you will have such mark down that the only thing the property CAN do is PERFORM!

Now you are an investor!

Happy Investing~