At Home With HouseHunt

In This Issue

	Seasonal Suggestion
	How to Bewilder Burglars
	Tips for Winterizing Your Lawn and Garden
	Buy Better in a Buyers Market
	Getting the Most Out of a Buyers Market
	Basic Home Buying Skills: Your Key to Home Ownership
	Monthly Survey
	Past Issues: October, September, August , July

Monthly Quote

“Thanksgiving Day is a jewel, to set in the hearts of honest men; but be careful that you do not take the day, and leave out the gratitude.”

-E. P. Powell, American pastor and journalist, (1832 – 1915)

Tip of the Month

As winter draws closer, it is time to start thinking about keeping those you love warm. By this, of course we mean your roses! When winter-protecting roses, remember that you are not only protecting them from the cold, but also from strong winds and unusually warm weather that may cause them to thaw prematurely. Follow these steps to protect your roses from winter’s threats:

1. Keep them well-watered. Fall rains usually provide adequate water, but if the weather has been dry, water deeply (to a depth of 18 inches or more) after the first frost but before the ground freezes.

2. Extend the soil. In early to mid-fall, when nights are regularly frosty, mound several spadefuls of soil over the base of your roses, extending the soil to at least a foot above the bud union. You can cut the canes back to 3 or 4 feet high and tie them together with string to make things easier. The part of the plant above the mound will be pruned off in the spring anyway. Also, make sure to get the soil from somewhere other than your plant’s base – it’s best not to go digging around your roses’ delicate roots.

3. Add a thick layer of mulch. When the ground freezes completely, add at least a foot of mulch to the mound of soil. This ensures that the ground stays frozen and that all of the plant is protected from the elements. You should pull off any leaves that are left on the plant since remaining leaves can increase drying. To keep the mulch and soil from shifting during the winter, you can wrap the bush in newspaper and fill it with mulch, compost or straw and tie it together. You can also purchase mesh cylinders or cones that fit over the top of the plant and can be filled with your preferred material.

4. Start removing the soil mound in the spring. When the ground begins to thaw, start removing the soil, gently. Don’t get started too early, as a late cold snap can be damaging. Remove the soil very carefully, as you may find new growth beginning. If you are concerned about damaging your plant, apply a gentle stream of water to remove the soil instead.

Source: Roses for Dummies by Lance Walheim and The Editors of the National Gardening Association, Wiley Publishing, Inc., 2000.

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Buy Better in a Buyers Market

Some buyers hear “buyers market” and think they will automatically get a good deal for a beautiful home. Since the reality isn’t nearly as simple as that, we’ll tell you how to buy better in a down market.

It may be hard to believe, but buying in a buyers market can be risky. Since real estate markets are always in flux, it is difficult to determine when the bottom is reached. In other words, you may buy your dream home at a great price only to have the value drop. Therefore, people looking to buy in this market need to be cautious. It isn’t enough to get a low price; buyers must also think about long-term value.

According to a recent Realty Times article, there are 10 ways you can protect your interests as a buyer in the current market.

1. Examine the relationship between prices and inventory in your local market. Even if prices have been declining, they may still fall further if the inventory of homes in the market continues to rise or is larger than usual.

2. Know that recorded sales prices do not tell the whole story during a down market. To know the whole story, you need to know how transactions are constructed. For example, if two homes are sold for $500,000, the actual cost to the buyers may be different. One buyer may have negotiated to obtain concessions (such as home inspections, repairs, etc.) worth $5,000, while the second buyer may have only obtained concessions worth $1,500. The only way to know what local transactions look like for sure is to partner with a local broker who has knowledge of a large number of transactions.

3. To understand the future value of your home, you need to look at the long-term prospects of the community. Is the population growing? Is the job base expanding? Is new home construction adequate to meet market demand? A growing population indicates more demand for housing, while an increasing job base is indicative of a larger pool of qualified buyers. Finally, if new home construction is not adequate to meet buyers’ demands, homes prices are likely to rise.

4. In previous years, homeowners who couldn’t sell their homes for a good price simply hung on until the market improved. Today, there are many forms of dangerous financing that can force sellers to sell at unfavorable prices or even foreclose. As a result of increasing foreclosures, foreclosure auctions are not always successful, meaning that lenders are stuck with a large amount of real estate-owned (REO) homes. An expanding REO inventory tells buyers that the bottom of the market has not yet been hit.

5. Be compassionate when negotiating with sellers in a down market. A buyer who flaunts his or her position is less likely to find negotiations easy or favorable. Instead of being critical of the seller or the home, explain that your situation prevents you from paying more. In other words, be respectful of the seller’s situation.

6. As lenders continue to tighten underwriting standards, buyers are well-advised to have reliable financing in place before going house hunting. If you intend to buy a home with no down payment and a stated-income loan application, think again. Many lenders have become intolerant for such arrangements, so you should have a loan officer review your credit and give you an understanding of how much you can borrow and what programs are available to you. Ideally, you should obtain a pre-approval letter from your lender to show sellers your capability to buy.

7. Be picky, and don’t go with the first property you like. In the current market, there are a large number of homes to choose from, which means that you should take your time. A good tip is to make up a list of features you need and features that you want, and try to find a property that covers most if not all of them. Time is in the buyer’s favor, as each day that passes is another day that sellers have to pay additional costs.

8. In what direction is your local market headed? Think about whether your community is part of newly developed suburbs or part of an inner-city area being revitalized. Don’t forget investing basics just because of the down market.

9. Don’t overstretch yourself in a down market. Sure, you may be able to afford a bigger home than you could in past markets, but do you really need a bigger home or the bigger mortgage that comes along with it?

10. Buy with care and be aware that no one can predict the future. Whatever the market is now, we have no way of knowing what prices will do in the near or far future. This uncertainty means that buyers should be especially cautious and not look for only low prices, but also properties that will have lasting value and desirability. Keep in mind that you may be buying today, but tomorrow, or five years from now, you may be the seller!

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