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Address of Home May Affect Price

The Housing Scene by by Lew Sichelman
by Lew Sichelman
The Housing Scene | December 28th, 2012

What's in a name? Plenty, when you're talking about the byway on which your house is located.

According to Trulia, the popular online real estate community, houses on "boulevards" are the most expensive, selling for 36 percent more than homes located on "streets." Houses with "boulevard" in the address are listed for sale at $117 per square foot, whereas houses with "street" in the address are going for a mere $86 per square foot -- the least of a dozen address designations.

To come up with these enlightening numbers, the Trulia trends team analyzed houses in its own database. Specifically, the team looked at the median price per square foot and limited the results to those address designations with at least 10,000 homes for sale.

Why is "boulevard" the most expensive? Trulia says the word itself might have more to do with it than anything. After all, it does have something of a sophisticated French origin.

Another factor, perhaps, is the mix of housing located on boulevards. Some 37 percent of the boulevard units were in multiunit apartment and condominium buildings, suggesting denser, urban settings where space is at a premium and housing costs are higher. By contrast, no more than 16 percent of the homes on the other paved paths were in multifamily buildings.

"Boulevard" also is an exclusive address. Only 2 percent of the Trulia listings were on pathways called boulevards.

Houses on "streets" accounted for 19 percent of the listings, but "street" wasn't the most prevalent. That honor belongs to "drive," which accounted for 22 percent of the listings. Houses on drives and on avenues were listed at $96 per square foot. "Avenue" houses were 15 percent of the listings, one point below dwellings on "roads," which were selling at $109 per square foot.

Here's the complete breakdown for all 12 address designations:

-- Boulevard, 2 percent of the homes for sale on Trulia and $117 per square foot.

-- Place, 2 percent and $110 a square foot.

-- Road, 16 percent and $109.

-- Way, 3 percent and $107.

-- Terrace, 1 percent and $102.

-- Court, 6 percent and $101.

-- Lane, 8 percent and $101.

-- Circle, 3 percent and $100.

-- Trail, 1 percent and $97.

-- Avenue, 15 percent and $96.

-- Drive, 22 percent and $96.

-- Street, 19 percent and $86.

There's no question that homes have gotten larger, and are still getting larger, even in the face of slower sales and tighter mortgage qualifications. But in something of an anomaly, household energy use is decreasing, according to government statistics.

The reason: energy features built into newer homes. New houses are better insulated, so they use less energy to heat and cool. The appliances are more efficient, and people living in even the biggest of houses tend to be more aware of the environment and energy waste.

According to the U.S. Energy Information Administration, improvements in the efficiency of the building envelope, space heating, air conditioning, refrigerators and other appliances have all led to decreased consumption per household.

For example, multipane windows are now the norm. About eight out of every 10 houses built since 1990 have double- or triple-pane, energy-efficient windows, the energy organization reports. About 44 million households now have Energy Star refrigerators, and 41 million have Energy Star clothes washers.

In addition, about 40 million householders report using caulk or weather stripping to seal cracks and air leaks, 26 million have added insulation, and 68 million have at least some energy-efficient compact fluorescent or light-emitting diode lights.

Even the fact that the typical house contains any number of television sets -- more than 50 million homes have three TV sets or more -- not to mention computers and other electronic devices, hasn't stemmed the decline in energy usage.

Looking for building sites? Lots of lots -- 250,000 or so -- are listed on LotNetwork.com, a website where developers market their land for residential development. But people who are interested in building custom houses rather than buying production models also can use the site to find sites.

Searching is free, by ZIP code, town, state or even a key word, such as "acreage." If you don't find anything you like on the first try, you can sign up for email alerts based on your own criteria so you will be notified immediately when a property becomes available. You can save your favorites and track price changes that might make one more attractive.

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Coming Soon: Foot Traffic Index

The Housing Scene by by Lew Sichelman
by Lew Sichelman
The Housing Scene | December 21st, 2012

In an effort to get the earliest reading possible on the housing market, economists at the National Association of Realtors are developing a national index that measures foot traffic, or visits to houses for sale.

NAR already has an index for pending home sales, which measures signed contracts. It is a forward-looking indicator that is roughly 30 to 60 days ahead of another key market measurement, existing home sales. A sale is listed as pending when a contract has been signed but the transaction has yet to close.

An index based on the number of showings to prospective buyers could be "an early, early indicator," perhaps preceding signed contracts by as many as 45 days, says Ken Fears, NAR's manager of regional economics.

NAR is able to track foot traffic through SentriLock, an association-owned property access control system. Each lockbox stores the number of times it has been opened to allow visitors to tour the house. Those data are used to build a weighted index that measures the percentage change in showings from one month to the next.

To date, Fears has developed showings indexes for 183 local markets where SentriLock is the prevalent lockbox in use by real estate associations. But he says he needs even more local data before a national standard can be developed. "We're still trying to get used to the interplay with pending sales," he says.

So far, statistical tests show a strong correlation between showings and contracts. An increase in visits in one month tends to predate a jump in signings in the next month or two. Similarly, changes in the showings index tend to precede sales, or closings, "by roughly two to three months," Fears says. Of course, it also follows that if doors are opened fewer times, there are fewer resulting contracts and sales.

The data have some shortcomings. For example, a lack of showings could mean that fewer properties are for sale. "By definition, you can't have a lot of activity if there are fewer homes on the market," the NAR economist says.

Also, a drop in loan rates might cause people who are already under contract to re-enter the market because they can afford a more expensive house. Too much of that kind of activity can lead to false readings.

The other obvious weakness is the geographical coverage. The data sample from SentriLock comes from only a small share of the total number -- some 800 -- of real estate boards nationally, Fears says. Consequently, the measure can provide insight into only a relative handful of individual markets.

But, says Fears, as SentriLock's market coverage expands, the data will become more representative of national trends, and a weekly index of showings could become a leading indicator.

Do you know where the cash is coming from to buy your house?

If you have even the slightest inkling that the money is coming from illicit sources, you have a duty under federal money laundering laws to report your suspicions to the authorities. If you don't, you could be considered a party to the crime.

Money laundering is defined as the process of making the proceeds of unlawful activity appear legal, so their illegal source cannot be traced. With increasing frequency, criminals are using their ill-gotten gains to buy houses and then sell them to convert their money back into cash.

According to Treasury Department officials, converting millions of dollars into a number of smaller transactions -- a process known as "smurfing" -- is the No. 1 ploy for hiding dirty money in the housing market.

Generally, real estate agents and lenders are required to report any misgivings under the Bank Secrecy Act. There could be a big penalty if they don't.

But sellers also can run afoul of the law if they suspect something is amiss and don't tell local law enforcement or the FBI, Michael Rosen, a policy adviser in the Terrorism and Financial Intelligence sector at Treasury, said at a recent real estate conference.

When a transaction varies from the norm, there is an increased chance the deal is subject to anti-money laundering laws. One key red flag for sellers is the source of funds for all-cash deals. But if the buyer asks you to "do me a favor," your antenna should wiggle as well.

In one case that Rosen described, a buyer who said he didn't want his parents to know he was purchasing such an expensive house asked the seller to lower the price and accept the difference in cash under the table from the buyer. Such a scenario needs to be reported, if not by the agent, then by the seller, the Treasury Department official said.

"When there are prominent red flags that signal criminal activity is afoot, a jury may infer that a defendant deliberately ignored facts that should have been obvious to a reasonable person," Rosen said. "It's not whether you know of criminal intent. It's a case of you should have known."

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Put Your Best Facade Forward

The Housing Scene by by Lew Sichelman
by Lew Sichelman
The Housing Scene | December 14th, 2012

Individual sellers can learn a great deal from mass-market homebuilders.

Take curb appeal, for example. There's a good reason builders skip every other lot when putting up model homes. Or leave out lawn-gobbling driveways. Or build models uphill from the street, never downhill. All these tricks of the trade are designed to make their homes loom as large as possible.

But while you can't rip out your driveway or make the house next door disappear, there are steps you can take to make a good first impression. If you don't try at least a few, you may not get a second chance to wow buyers with the inside of your palace. In other words, all the emphasis on interior home staging -- prepping a home's interior for maximum appeal -- could be for naught if you ignore the exterior. You have only a few key moments to spark someone's drive-up interest, so it pays to put your best facade forward.

Not many buyers will make up their minds from the curb alone. But many have found the outside of a house so unappealing that they didn't bother to go inside.

Fortunately, you can beef up your home's exterior for less than $500 and a weekend's worth of time. Power washing a stained walk or driveway is labor-intensive, but not that expensive. Ditto for trimming the shrubs, mulching the garden and planting colorful flowers.

If you have the time and money to go all out -- say, by replacing discolored siding, replacing worn-out windows or adding shutters -- you should be able to recoup most of your out-of-pocket cost.

According to the latest "Cost vs. Value Report" from Remodeling trade magazine, the projects offering the greatest return on investment involve what could be called "curbscaping." Seven of the 10 top-ranked projects are siding, window or door replacement jobs, with cost-value ratios above the average 71.6 percent.

"The high value of replacements is due partly to their relatively low costs," editor Sal Alfano said, commenting that most "immediately improve curb appeal."

But, again, you don't have to go to that much trouble to make your home's exterior more inviting. All it takes is a critical eye toward detail and the desire to create attractive finishing touches that stand out from the street.

For starters, take a step back. Walk across the street and look at your place the way first-time visitors will see it. Give it a wide view, searching for positive features that can be highlighted and negative elements that can be hidden or even eliminated.

If it will help, take a photograph of your house to use as a basis for the improvements you want to make. Since color can affect your perception of problem areas, stick to black and white film, which shows the greatest contrast -- or the lack thereof.

The most obvious exterior improvement is a fresh coat of paint. Nothing creates impact more than color. Since different people have different tastes, keep it neutral, with earth tones as the main hue and stronger shades to accent the windows and doors. Keep in mind that two or three colors are enough to make a statement.

If painting the entire exterior isn't an option, consider painting at least the doors, shutters or window frames to give your place a little pop. If your front door is made of wood that has been painted, consider stripping off the paint and staining the wood, which is much more inviting.

Your front door should be visible from the street. If it isn't, add an arbor or other landscape element to point visitors in the right direction.

Potential purchasers are just as likely to show up after dark as in the daytime, so replace your front-door light fixture with a brighter, shiny one. Also think about laying down landscape lighting. And remember to keep the lights burning in the evening. You never know when a buyer might be on the prowl.

If you have a front porch or stoop, clean or replace any furniture out there and add new, colorful throw pillows. The idea is to give visitors a place to stop and enjoy the front door.

For a little extra spark, add a polished door knocker. Replacing an old, tarnished lockset and accenting the doorway with decorative pots or planters also are good ways to add vitality.

If you have a garage, especially one that faces the street, treat those doors the same way. If they are in bad shape, replace them. In some houses, garage doors take up half the front or more, so they contribute -- or subtract -- from curb appeal like any other element.

Remember to keep the doors closed at all times so visitors will feel the impact. You want people to see your smile, not be able to peer into your mouth.

Don't neglect the walk and driveway. They need to be clean and free of cracks. Put the kids' toys, the hose and other gardening tools out of sight.

Fresh grass or sod is another cost-effective way to dress up your property. Seeding, of course, is the least expensive way to go, but it takes time for the seed to germinate. Sod is faster but far more costly, especially if you have to hire someone to do the work. But it might be best for curing those bald spots in the lawn.

Either way, make sure you start the process long before the house goes on the market. The last thing you want visitors to see is a bunch of stakes and ropes that cordon off freshly planted areas and signs that warn folks to "Keep Off the Grass."

Chances are you already have shrubs and trees, so you probably won't have to invest in these key design elements. But make sure they are trimmed and tidy. Remove dead leaves, branches and debris, and add fresh mulch to dress up planting beds.

If your place is going on the market in the growing season, adding flowers is a minimal investment with a maximum payout. Fences and gates are far more expensive, but they are an excellent way to frame your entire yard and set it apart from your neighbors.

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