Great Photos Needed If You Use Internet Marketing

The best estimate is that over 80-percent of home buyers today use the Internet to look for a home. That's data from the National Association of Realtors. Since we now live in such a visual age, postings on the Internet must be visually appealing. This means any house posted on a website must, I repeat, must have great photography.

According to RIS-Media, a real estate trade publication, homes with 20 or more photos received almost ten times the number of leads and more than fifteen times the number of showings as homes with only one online photo.

But, how do you create great images?

Well, in one of my past lives I did more than my fair share of photography at various advertising and public relations agencies where I worked. I photographed a couple of model homes along the way, so I thought I'd share a few tips.

First, don't skimp on equipment. Buying a cheap little camera means you are likely going to lack the options necessary to make your photos look good. You just won't be able to do what you have to do. By the same token, don't go overboard and run up a huge bill for equipment. Stay within your budget, but get all that you need to do the job right. I happen to like Nikon equipment, but Canon, Pentax, Sony, and all the other top brands make great equipment too.

Second, get a flash. A real flash unit (not the little one that comes in a point-and-shoot camera) makes colors pop and fills in the shadow areas of a room so it looks bigger. I use a flash on every interior shot and a lot of exterior ones as well.

Third, shoot the front of the house only when the sun is shining on it. If you must take the shot when the sun is not shining on the front of the house, overexpose and/or use the flash. On good cameras, there is an "overexposure compensation" button or dial. Turn it to "+" to lighten the exposure or "-" to darken it a bit. That should help.

Fourth, shadow your lens. Make sure a shadow of some kind falls on your lens. This helps you avoid sun spots or "flare". Use an umbrella or ball cap to block the sun. I almost always take a Tampa Bay Rays cap with me when I shoot. First, I'm a fan. Second, I block the sun with it.

Fifth, buy a tripod. This is perhaps the most useful piece of equipment after your camera and flash unit. The tripod lets you keep the camera straight under all conditions. Keeping the camera straight keeps the rooms from looking crooked. Also, you'll need a tripod to take those picturesque evening and night shots that look so spectacular, especially back by the swimming pool and spa.

Sixth, use a wide angle lens. I like to use a wide angle zoom lens but a fixed focal length lens will work just as well. I suggest lenses of about 24mm to 28mm, but I have used them as wide as 12mm. A wide angle lens is your best bet for including as much of the room as possible.

Seventh, don't list the house until the photos are shot. Photos have to be included with the MLS insertion, or shortly thereafter. I sometimes hold off listing the property until I have the perfect set of photos. If that means waiting for the sky to turn blue or the rain to stop, so be it. It will only be a couple of days and I want the sky to be cobalt blue not gun-metal gray. It's worth the wait.

Eighth, shoot the best parts of each property. Most buyers want to see the exterior front, kitchen, main living area, family room, and master bedroom at a minimum. I don't shoot bathrooms unless there is something really outstanding about that room. Don't forget to shoot the entry foyer, screened lanai, and garage too. Remember, you're creating a visual tour of the property.

Ninth, practice. Nobody is good a taking photos of houses (or anything else) unless they practice with the camera and the necessary techniques to make good photos. So, take photos of your house or condo until you are good at it. Start off by reading the instruction manual that comes with your camera and learn the basics. Then, get more advanced. Eventually you'll find out what works for you and what doesn't. Have fun with it.

If you just don't feel comfortable taking the photos yourself, hire a professional photographer to shoot the property for you. It's really not that expensive, and good photos are absolutely essential to make the right kind of statement on the Internet. And besides, if the photos don't turn out right you can always blame the photographer.

Happy selling!

-30-

Big Changes Being Proposed For FHA Buyers

If you're an FHA buyer, you might want to give your mortgage representative a quick phone call. Some big changes are in the wind at the Federal Housing Administration (FHA), and you need to keep up-to-date on what these proposals are and how they might impact your ability to purchase a home using an FHA-backed mortgage.

In a nutshell, the FHA wants to make it tougher, a lot tougher, on borrowers. Here's what FHA is considering ...

• An increase in the upfront cash paid by borrowers;
• Raising the minimum credit scores for borrowers who receive FHA-backed mortgages;
• Limiting the amount of money sellers can kick-in for closing costs and "free" upgrades.

The goal here is twofold. First, by increasing the amount of up-front money paid by borrowers, the FHA hopes to improve the agency's current financial picture which has been pretty badly beaten up because of rising defaults. Second, by requiring buyers to invest more money in the initial home purchase, the agency believes that buyers will be much less likely to default on loans or just walk away from properties. The feeling in Washington is that the more skin a buyer has in the game, the less likely he is to just walk away.

This stuff is all in the "proposal" stage now. Nothing is set in stone. At the present time, down payments for FHA mortgages can be as low as 3.5% of the purchase price. Most in Congress and in regulatory capacities think that is too low. One lawmaker has already introduced legislation that would move the minimum down payment to 5%. The "seller concessions" are now maximized at 6%. Current thinking is that those concessions may fall to 3% to be more in-line with conventional lending practices.

In addition, it is quite likely that the the monthly insurance premiums charged to borrowers will be increased as well. The FHA's staff is reviewing this matter and the amount of the increase.

These measures, and others, are all designed to help FHA curb its exposure to risk and improve its weakening cash reserves. My guess is that these FHA changes will come to pass within the next few months. So, if you're going to buy a house with an FHA mortgage, my suggestion is that you get it done soon ... real soon.

-30-

November Sales ... Ugh!

I actually thought the real estate market in Pinellas County was starting to look brighter in September and October. But in November, somebody dimmed the lights.

Let's take a quick look.


We begin, as usual, with the Absorption Rate (AR). In November, the AR for single family homes fell to 9.6% from October's 11.3%. That's a pretty sizeable drop for one month and it is absolutely moving in the wrong direction. For condos about all you can say is that the slide continued. The condo AR for November fell to 5.7% from October's not-so-darn-good-anyway rate of 6.8%. I'll have more info on condos later in this report, and frankly, it ain't too cheery.

Single Family Homes

During November, the MLS reported 6,096 single family homes listed for sale. That's a decrease from October's 6,373. To be honest, we didn't sell a bunch of homes to create this decline in listings. I think a lot of sellers simply have thrown in the towel and taken their property off the market hoping that things will get better someday soon and they can re-enter the marketplace. They would still like to sell the property, but have lost patience with keeping the place model-home clean, appointments at the dinner hour, open houses on Sunday and all the rest of it. We call these "ghost sellers" and they will be back at some point. When you add in these ghost listings, there are a lot more homes on the market than what is reported in the current MLS.

November saw only 586 sales. We did a lot better in October when 718 single family homes were sold. There may be a lot of reasons for this decline and about all we can do is hope that the market comes back this fall and winter.

I don't know what to say about the median prices. If you look at November 2009 versus November 2008, the median price has dropped another 8.4%, from $159,900 to today's $146,500 for single family homes.

But if you look at median prices since January 2009 to the end of November, prices have risen! In January, the median was $124,500 versus today's $146,500 -- a tidy little increase for 11 months.

What I think we should keep in mind is the definition of a "median price". The median -- and I have explained this before -- is the figure at which half the buyers paid less and half the buyers paid more. It's the halfway point. To my way of thinking, if the median goes up it means that buyers appear to be willing to buy more expensive homes, or at least pay a bit more for a house they want. I don't think it really says too much about the VALUE of a piece of real estate, and I don't think it means real estate prices are rising. It simply means that buyers are buying more expensive houses than they were in past months. So, maybe we've just attracted some more affluent buyers, I don't know. Time will tell.

Condominiums

This is getting bad. Really, really bad.

In November, the MLS reported 5,382 condos on the market in Pinellas County. In October there were 5,619 condo units listed for sale. That's a lot of unsold inventory.

Sales took it on the chin in November. Only 305 condos were sold, and this is supposed to be the start of "the season". In October there were 381 condo sales. So, we sold fewer units.

Here's the thing about condos that will make your head spin -- or at least it made mine zip around. In November the median price for condos in Pinellas County was only $116,000. In November of 2008 it was up at $125,500. That's an annual drop of 7.6% year over year. Now remember, the same definition of median pricing holds here about condos. To my way of thinking it means that buyers are buying even less expensive condos now than they were a year ago!

I went back and found out the median price for condos in January 2009, thinking to make a nice comparison and show that median prices were rising a little like they did for single family homes throughout the year. Nope. Didn't happen. In January 2009, the median price for a condo was $125,000 and now it's dropped to $116,000. So this means buyers are probably willing to pay even less for condos now than they were willing to pay for them earlier this year. To me, this kind of signifies that today's buyers don't see as much value in condos and the condominium lifestyle as they have in the past. Anybody think I might be right with that kind of idea?

To my way of thinking, the condo market as a whole continues to slide. Overbuilding of units and a change in the demographics of Pinellas County probably have a lot to do with it.

So, that's where we stand as of the end of November. Kind of a ho-hum month, but condos got the worst of it ... again.

Happy Selling!

-30-

Today's Homebuyer Characteristics

So, what do we know about today's home buyer?

Well, quite a bit actually.

And it's all contained in a nifty little 211-page report compiled by the National Association of Realtors. If you want to read the entire report, just go to www.floridarealtors.org/Research/Indeex.cfm.

If, however, you have a life and are satisfied with the report's highlights, here's the important stuff as it relates to Florida buyers during 2009 ...

• 41% of recent home buyers were first-timers in Florida, as compared to 47% nationwide.
• The typical first time buyer in Florida was 31 years of age; the typical repeat buyer was 54. Nationwide, buyers were 30 and 48 respectively.
• The 2008 median household income of buyers in Florida was $71,100; nationwide, $73,100.
• Single females made up 18% of recent home buyers in Florida.
• The typical home purchased was 1,850 square feet and built in 2000.
• The median price of a single family home purchase was $176,500.
• More than one-third of home buyers started their home search looking at online listings.
• 75% of buyers used the internet at some point during their home search.
• The typical home buyer searched for 12 weeks in Florida.
• The typical home buyer financed 93% of the home's purchase price.
• Recently sellers typically sold their home for 93% of the listing price, and 65% of sellers reported that they reduced the asking price at least once.
• For Sale By Owner sellers made up only 10% of Florida sales.
• 40% of FSBO sellers knew the buyer prior to the home sale.
• 15% of FSBO sellers reported that completing the sale within their planned time frame was the hardest part of the selling process.

It's amazing how you can condense a 211 page report to just a few factoids isn't it!

-30-

New Short Sale Rules Should Help Everyone

On Monday, the U.S. Treasury set new, more streamlined rules for short sales. Real estate agents, home sellers and buyers should all benefit from these new guidelines.

The Home Affordable Foreclosure Alternatives Program (HAFA), which is part of the Home Affordable Modification Program (HAMP), gives important financial incentives while simplifying short sale procedures. The HAFA rules set limits on the time frame for lenders to respond to buyer offers on distress properties, free many borrowers from debt and cap the claims of subordinate lenders. The new guidelines also ensure that real estate agents get paid the agreed upon commission for the work they do regarding short sale transactions.

Here are some of the important highlights of the new guidelines ...

• Lenders must now respond to short sale requests within 10 business days of receipt of the offer package.
• Sellers are now released from all liability for repayment of the mortgage debt.
• Sellers are now entitled to a relocation incentive of $1,500. This amount will be deducted from the gross proceeds of the sale.
• Lenders will receive $1,000 to cover various administrative and procedural costs for short sales and for deed-in-lieu transactions.
• Properties must be listed with a licensed real estate broker doing business on a regular basis within the community where the property is located.
• Lenders can no longer require that the agreed upon real estate commission be reduced as a condition of approving the short sale.

There are other guidelines associated with this matter, but these seemed to be the "biggies" to me.

I think this will make short sales faster and easier for everyone involved. Moreover, with a new batch of adjustable-rate mortgages ready to reset in 2010, an unemployment rate holding in excess of 10-percent, and a generally dark cloud still hanging over the nation's economy, many real estate gurus see a huge new batch of distress properties coming onto the market next year. So, anything that makes selling and closing these troubled properties faster has to be considered as great news for the real estate industry -- and heaven knows we can use a little of that.

-30-