About Richmond City County, VA

Homes For Sale in Richmond Virginia Just yesterday I received one of those calls, you real estate professionals know the ones, from a past client ( let's call him Jim) that had gone off on his own to make a purchase with out the help of his trained and experienced Realtor. Needless to say he was now in a quandary and did not know which way to turn. Six months ago he had purchased a property from a FSBO, mistake #1, we all know what FSBO's are, but for those of you who do not, it is simply someone trying to save a commission. Both seller and buyer agreed on the terms and price and made a deal. Now Jim needed some financing to make the purchase so he contacted a local small bank for a mortgage. I'm not sure where he went wrong but he secured an interest only balloon mortgage. Jim understood the interest only portion but did nor recognize the balloon portion as a big future problem. The closing went as planed and Jim took possession of his newly acquired property with visions of flipping this property and making an honest profit. He worked on the property for several months, renovating and making the necessary repairs to bring this property into good condition. The bills were piling up and so were Jim's revolving card balances. Now having finished the project Jim decided to rent the property due to a down turned real estate market in the Richmond area. He started inquiring about a refinance with a 30 year fixed loan with the current mortgage holder. Much to his surprise he was informed the "balloon" was due any payable on Dec 1 2008, only a week or so away! The current mortgage holder said they could not help because of the increased debt coupled with a reduction in credit scores disqualified him for a mortgage. This was not only the case with the current mortgage lender but two others produced the same result. Facing loosing his property and all the time , effort, and money spent he decided to call me. Realtors face problems like this every day, and steer their clients in the right direction. What may seem on the surface as saving money CAN COST YOU MORE! Before you consider buying a home for sale in Richmond Virginia visit my web page http://ricksalerealty.com/ for more information. Thanks for reading Rick

When it's time to put your house on the market, I believe one of the biggest "bang for your buck" improvements a seller can make is contained in a simple can of paint! I believe it's so important that I tend to recommend painting first, even if it means there is no money left in the budget for my staging services. Buyers want homes that are move in ready! Colorful walls scream "work to be done" especially if they are not in the color scheme a potential buyer prefers. However, if the home is neutral in color (this doesn't mean white!), a buyer can move right in. When the buyer wants to put their own color on the walls, it's now called "decorating" not "work"... which is much more fun!

Here's a couple examples of too personal color choices:

It is also very important to add color, not just take it away. A warm, neutral color on walls makes the room feel cozier, makes the woodwork pop, and the room feels less sterile overall. Below is an example of a dining room (same model), one was left white and empty, the second one was painted and staged:

Judy Heinrich Home Staging, LLC - providing professional home staging services to the greater Richmond, Virginia area. For more information on preparing your home for sale, please visit www.judyheinrich.com or phone 804-271-2604.

The economic news continues to be grim. The equity markets have been in free-fall. Daily drops of "only" 300 points are heralded as a positive. The credit markets remain frozen. And more money is chasing commodities and government bonds, pushing yields on those investments ever lower.

One bright spot in this debacle? Oil prices have dropped, leading to dramatic price declines at the gas pumps. So there is SOME good news for the average American.

But what to do if you would like to make up some of that dramatic value decline in your stock portfolio?

I suggest you consider investing in income-generating residential real estate. Whether that means your "first" real estate investment, perhaps a small, modestly priced, single-family home, or your 50^th, in major multifamily properties, there are some amazing opportunities.

Please note, I am absolutely not talking about speculative real estate investment, like building custom homes for resale, or "flipping" homes for quick cash. Leave that to the professionals and the risk-takers. But if you have cash to spend, and a willingness and ability to invest time and/or capital up front, income-producing residential real estate might be the best game in town. Here are the Top 10 reasons why:

1. There is a glut of inventory. Supply far exceeds demand. The basic laws of economics mean this favors the buyer.
2. Even in a down market, some people have to sell. I crassly call this the "Three Ds" - death, divorce, disease. Add relocation to this list and you have the basic reasons for "irrational" selling, i.e., selling in a down market.
3. Investor-buyers evaluate real estate differently, and can identify overlooked opportunities. They are unemotional buyers. A home that doesn't appeal to the homeowner-buyer, who needs to L-O-V-E a property, could be a GREAT rental. If you can identify these undervalued properties, you can essentially "buy" equity.
4. Any necessary repairs or upgrades may depress a property's price artificially below what I call the property's "intrinsic value," what the home should be worth in good condition. If you can do repairs or upgrades, you can add value exponentially greater than the out-of-pocket cost.
5. Real estate is still a highly leveraged investment. In real estate, you need invest only 5%, or 10%, or 20%, of an asset's value in order to control that asset and generate income.
6. Foreclosures and job losses mean there are more deals, and even "steals," out there.
7. The macro-economic picture should mean a higher demand for rentals, as people are pushed out of homeownership by foreclosure or job loss, or delay homeownership to save a down payment.
8. Real estate remains a tangible, appreciating asset. Get a renter into a property and have that person pay to build your equity.
9. Income-producing real estate provides substantial tax benefits, including depreciation write-offs.
10. Income-producing real estate can be sheltered from capital gains tax liability in your lifetime through Section 1031, or "Starker," tax-deferred exchanges. Your beneficiaries get a stepped-up basis in the property when you pass.

Now, real estate investing is NOT for everyone. If you do not have the time or the inclination to deal with tenant issues. or the money to hire a professional property management firm to deal with those issues for you, rental real estate may not be for you. But if you have always wanted to give real estate investing a shot, and you have significant cash reserves, there are some amazing opportunities out there. Give me a call. I'd be happy to help you. [;)]

P.S. No matter what, USE AN EXPERIENCED BUYER'S AGENT who knows how to evaluate income-producing property! NOT your sister's best-friend's Mom. No offense to your sister's best friend's Mom, of course.

Richmond Real Estate

Click here for homes for sale in Cary Street Road Neighborhood

Architectural Styles: Styles here vary widely within the build dates between 1910's - '60's. Most homes are traditional in floorplan, with 2-story Colonial facades, but also in varyious Revival architectural styles .Typically,they are architect-designed, and built at the highest quality and amenity levels.

Average home price: $1,025 million (ranging from $400,K to just under $4.million)

Schools: Serviced by Richmond City Schools of Munford Elementary, Albert Hill Middle, and Thomas Jefferson High School. Plus the highly sought-after Open High, and Community High and the International Bachelaureate Programs and the Governor's School Programs. Or by several exceptional Private schools ,several exceptional Private schools St. Christopher's, St. Catherine's, Steward School and Collegiate are within a few minutes drive.

Recreation: Provided by nearby country clubs and private facilities, or as this area is located within the Richmond City limits, there are parks, the James River and Recreation programs to explore. And for those seeking 'recreational guidance', many seek out the SEALS program (especially after the Holiday Season...eh hem). If you prefer water based recreation, try rowing, sailing, yachting clubs, Virginia Boat Club, Richmond Yacht Club. Or if you prefer league sports, try volleyball, soccer, or tennis, plus there are great youth programs in Little League, Lacrosse, and swimming. Don't forget equestrian interests. There's also a premier (indoor) climbing gym, just across the river and a sports park for practicing your batting or golfing skills. Don't forget Socializing and Golf pursuits through many of the private country clubs, especially those located just west, into Goochland county's 'Country Club Corridor'!

Transportation: For business, shopping, etc. the most oftened travelled route is the east-west thoroughfare of Cary St. Rd./River Rd., or/and Rte 6/Patterson Avenue. Both of these offer quick and easy access to Interstates and state routes that circle and bisect the greater Metro area. Truly a very convenient and central place to live...very comfortably.

Well, I got radio silence in response to my October 10, 2008 post on dual agency. I'm actually rather surprised. I thought - and hoped - some more experienced agents might try to tell me why I was wrong, and why dual agency wasn't a bad idea. Oh well, I would have liked to have read the counter-point.

I'm going to pick up where I left off on dual agency. The example I was working with: you have a seller, with whom you have a listing agreement obligating that seller to pay you the standard 6% commission for the sale of the house, to be split 3%-3% with a buyer's agent. A potential buyer, UNREPRESENTED, walks in to your Open House, falls in love with the house, and wants to buy it RIGHT THIS MINUTE. I take the position that you shouldn't represent both the Seller and the Buyer, even though it's legally permissible to do so in Virginia. So what CAN you do?

First, you can write up an offer for the potential buyer, so long as that buyer understands that you represent the Seller's interests, and so long as you do not share any of the Seller's confidential information. In other words, you can commit the potential buyer's offer to paper, write it up with all the appropriate contract forms, and present it to your client, the Seller, for consideration. In this instance, the Buyer is merely a "customer," not a client.

[NOTE: I am not sure whether you can advise the potential buyer on non-price terms that might make the offer more attractive, like (i) a short closing timeline; (ii) waiver of inspections, or short inspection timelines; (iii) waiver of financing or appraisal provisions; etc. I feel like this is a grey area, and you might be able to say something general along the lines of "these types of non-price concessions are not atypical, here's how they work, they can make your offer more attractive." But it makes me uncomfortable, and I think you would have to be V-E-R-Y CAREFUL not to cross any lines. I wish Lem Marshall, General Counsel to the Virginia Association of Realtors and real estate legal expert extraordinaire, could clarify this with some of his wisdom....]

A second option is to refer the potential buyer to another agent, and for that agent to represent that buyer throughout the transaction. This is called "designated agency." Usually, an agent within the same brokerage becomes the buyer's agent, the listing agent being "designated" by the broker to represent the seller and the buyer's agent being "designated" by the broker to represent the buyer. For this to happen, the listing agent would say something like this to the potential purchaser standing in the living room frothing at the mouth to write an offer on his or her Open House property:

"Look, I represent the Seller in this transaction. If you want to be represented also, I can recommend someone who will do an excellent job representing you and advancing YOUR interests."

If the potential purchaser agrees that (s)he wants an agent, and (s)he would like you to recommend one, the listing agent then contacts the agent they would like to "designate" and negotiates a referral fee on that buyer-side commission, typically 20%-30% of the 3% buyer's agent's commission. Oftentimes, agents may have pre-existing referral arrangements, where they refer all of these types of referrals to one or two specific pre-selected agents. For example, this works well within the team structure.

Why don't most listing agents recommend designated agency in the "customer at the Open House" example? I think there are three (3) main reasons:

1. The lure of the entire 6% commission is strong, so listing agents prefer to (i) represent both sides as a dual agent; or (ii) represent the Seller ONLY, theoretically keeping the buyer as a "customer," not a client.
2. If the listing agent recommends designated agency, the potential buyer may get spooked, because they might assume you won't recommend anyone who is any good. But now the buyer has decided they really must need representation, so they choose to work with their brother's sister-in-law's best friend as the buyer's agent. The listing agent loses a potential referral fee.
3. Ignorance or inexperience. Some agents just don't know any better. But ignorance of the law is no excuse. If you violate your statutory or common-law duties to your client, the Seller, or if the buyer does not understand that you are not representing him or her and relies on your advice in the mistaken belief that you are advancing their interests, the fact that you didn't mean to mislead or didn't know any better ain't gonna get you off the hook with the Real Estate Board.

Here's the deal with designated agency. The potential buyer in this example, a stranger off the street who just walked into your Open House, has to trust you to recommend someone good. If they don't trust you, but you have now given them the song-and-dance about why representation in a real estate transaction is so important, they are going to find their own agent. And I'm pretty sure EVERYONE on the planet knows SOMEONE, usually several someones, who is a Realtor. So that potential buyer might just feel better with someone (s)he knows, even if just tangentially. And isn't that a reasonable conclusion?

But the problem, AGAIN, is that possible outcome creates an inherent financial disincentive for the listing agent to recommend designated agency. Instead, it creates an incentive to push for Option 1 above. And in my not-so-humble-opinion, Option 1 does not advance the buyer's interests in any way, shape, or form, but does advance the listing agent's interests, as well as the (deserved?) perception of Realtors as self-serving sleaze balls.

The fundamental problem here is real estate transactions are extremely complicated, extremely significant financial transactions. And most people, even very educated people, do not understand how a real estate transaction works. Is that any surprise? Joe Blow (I feel like I should say "Joe the Plumber") may only buy and sell 2-3 houses in his entire lifetime. To the general public, it's about finding the house you love at the price you're willing to pay. The mechanics of negotiating the deal, arranging the financing, inspecting, appraising, managing the sale to closing - that stuff is all pretty much Greek to many buyers and sellers, and they don't want to be bothered. The average buyers and sellers just want it DONE, so they can get into their new house and start decorating.

Because the general public does not understand how the compensation flows in a real estate deal, agents can take advantage of their clients' ignorance to benefit themselves. And unfortunately, it seems agents often do.

What's the answer? I dunno, but I have some suggestions. I think dual agency should not be permitted, period. [To convince me otherwise, I invite anyone to write a rousing defense of the benefits of dual agency.] Designated agency is fine, with appropriate disclosures. I think agents should be required to provide much stronger disclosures about their fiduciary obligations and who they represent. We need to make sure buyers are actually reading these disclosures. Perhaps there should be a 24-hour "review period" required after the disclosure documents on agency relationship are provided to the potential buyer. Why not make listing agents disclose their commission amount, and how much they make if there is no unrelated buyer agent on the other side? In fact, why not make listing agents provide a copy of the Listing Agreement to the potential buyer? Finally, I think the best and easiest way to nip this problem in the bud is for Sellers to refuse to allow dual agency in their listing agreements. There is a space at the bottom of our form Listing Agreement, Paragraph 5, "Compensation," that says the Seller permits the following types of agency: buyer, dual, designated, or "other." Just don't check "dual." Simple as that. Problem (partially) solved.

Thoughts, comments, feedback?