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I guess the ex-Mayor of Detroit isn’t planning on moving to his Tallahassee Florida home any time soon (even after he finishes serving his time in jail). The 4 bedroom, 3 bath home that the Kilpatrick’s purchased in June of 2007 for $430,000 is currently on the market for $399,900 with Gary Bartlett, a former television news anchor turned Realtor.

As a Realtor, I was just musing about what might happen if an offer comes in while KK is behind bars?  I can just hear Gary Bartlett saying to the other agent, “Well, it might take me a few days to get back to you with a counter offer.  The next time my client’s wife can visit him in jail to get anything signed is Friday.”  That would certainly make for an interesting transaction.  Of course, they will take care of such things with a Power of Attorney, but, still, I had fun musing.

Today’s Detroit News had an article about how happy the neighbors in the Detroit neighborhood surrounding the Manoogian Mansion were  to have the commotion that came along with having the Kilpatrick’s as neighbors a thing of the past.  Certainly the Tallahassee neighbors have been affected to a much lesser degree, though they might be hopeful that a full time resident will purchase the home.

Wondering if the proceeds from the sale, if their are any, will be used to pay off the $1 million Kilpatrick owes in restitution?

Photo from Gary Bartlett.com

As a home stager, I am called by real estate agents and homeowners to help prepare their properties for sale. While it is impossible to say how long the house would have taken to sell had I not been involved, I firmly believe that the changes implemented have made a difference in the DOM.

I could quote national statistics of staged vs. non-staged houses, but I don’t think they translate to Michigan or accurately reflect our real estate market. Things are a little different here in The Mitten. My fellow local stagers, across the board, have all reported good results with the properties they have staged. I can say with great confidence that staging works.

So, why aren’t more houses staged?

As I look around at all of the “For Sale” signs in Oakland County, I ponder this question. Is it fear of the unknown? Are people still unaware of home staging? Are real estate agents simply confident in their ability to tell sellers what must be done to sell? Are sellers afraid of stagers touching their “stuff”? Is there a misconception that staging is expensive and only for high-end houses? Are sellers non-believers? Are agents?

So, in the interest of full disclosure, here is a list of “wills” and won’ts” when it comes to staging.

A good home stager WILL:

• De-clutter
• De-personalize
• Organize
• Explain why we’re doing what we’re doing
• Edit furnishings down to the minimun needed in each room
• Re-purpose and work with what you already have
• Suggest specific accessories if augmentation is needed. Most will be able to rent to you from their own inventory for a nominal monthly fee
• Make the house look as up-to-date as possible
• Accentuate the focal point of each room
• Maximize positive features and minimize flaws
• Identify problems that need attention, such as cracks, water damage, unfinished projects, burned-out bulbs, odors, stains, worn hardware and fixtures, etc.
• Improve traffic flow
• Suggest neutral paint colors
• Create a warm, inviting feel that buyers will respond to
• Pump up the curb appeal
• Determine correct artwork placement
• Be the “bad guy”, since most sellers take suggestions better from an objective third party
• Refer sellers to trusted painters, handymen, cleaners, storage facilities and contractors
• Arrange for rental furniture if needed
• Improve every house, regardless of price, location or condition
• Treat your belongings with care
• Work WITH the agent to get the house sold
• Understand and respect that selling is an emotional process
• Be your biggest cheerleader and root for a quick sale

A good home stager WILL NOT:

• Hide problems by covering them up
• Berate your design choices
• Pretend to know if your house is priced correctly or being marketed well
• Charge you an arm and a leg for staging. If you have a budget limit, TELL US! We can suggest many low-cost or no-cost remedies that will help the property show better
• Use sub-standard garage sale furniture in your house (yes, I have heard this is a concern!)
• Be a go-between with your ex (yes, this has happened also)
• Throw anything away without your consent
• Sugar-coat the truth
• Second-guess the agent’s advice
• Clean the house, other than any messes we have made (i.e. we don’t do windows!)
• Insist that you install granite or gut your bathroom
• Dismiss your concerns
• Stop staging until your house looks it’s best

I hope this gives readers a better view of a home stager’s role and clears up any misconceptions. Getting the house sold is our #1 priority, and we will do whatever we can to that end. We have a passion for the job. Otherwise we wouldn’t put our bodies through the wear and tear of staging! For those that have been unsure or afraid to use a stager’s services, what not give it a try on your next listing? You just may become a believer too.

Go Tigers!

In a historic move yesterday, Treasury Secretary Carlson announced the government takeover of Fannie Mae and Freddie Mac. The two financial giants have been struggling over the past year due to an unprecedented increase in foreclosures which relate to falling home values and the subprime loan meltdown. If the two were allowed to fail the results would have been catastrophic.

Fannie and Freddie are the most important conduits involved in mortgage lending. They purchase or guarantee more than one half of all mortgage loans made in the U.S. – almost $5 trillion. Lack of confidence in these entities this year has resulted in a steep decline in demand for the mortgage backed securities (MBS) created when mortgage loans are made. This weak demand has caused mortgage rates to remain higher than they otherwise could be and higher mortgage rates are not helping the ailing housing market.

This year we have also seen a huge increase in fees that Fannie and Freddie have introduced to offset losses. A whole new rate structure was introduced whereby anyone with a credit score under 720 was charged a higher rate and the rate kept going up the closer you got to a 620 score. In the past, any borrower who was approvable within conventional guidelines got the same rate regardless of credit score. There is some hope that the government will reduce or eliminate these fees allowing more borrowers to be approved at lower rates.

Overall, this move should help to reduce interest rates on conventional loans and attract more buyers into the housing market. I can tell you it’s already working in terms of lowering mortgage rates as the 30 Year Fixed rate declined from 6.5% on Friday to 6.0% today. That’s over a $65 decrease in the monthly payment on a $200,000 mortgage!

The purpose behind this takeover is to improve confidence among investors who buy MBS, to ensure the continued viability of the U.S. mortgage market and to help ease the worst decline in home prices since the Great Depression. Let’s hope it succeeds!

A recent client wanted a completed NEW home in Birmingham.  With a budget of $2,000,000, one would have thought we would have had plenty to chose from.  We did not.

Spec building in Birmingham, and throughout Oakland County, has almost come to a stop.  We are still seeing a few spec homes going up around town, but not many at all.  Most builders are holding off starting new projects, with a few exceptions.

One prominent local builder told me that other builders are having trouble getting lines of credit for construction.  Many of those who have access to cash are risk averse, and not building specs, reserving their work. Anyone who has lived here more than a few years will notice that there are less construction sites throughout the city.

In some ways, this is a good thing. It will help some resale home sellers who might have lost a buyer to new construction, but did not have that option. As the inventory of resale homes diminishes, that can put supply more in balance with demand. Eventually prices will start to head back up, and builders will start building again.

Personally, if I were a savvy builder, I would be looking to acquire land, even if I did not plan to build this year. There are some super values out there, and if the property is rentable it can have a decent positive cash flow for a while.

Sophie was selling her drawings at the Blueberry Festival in Paradise, Michigan. That is up at a northern tip of the UP for those of you who have never heard of Paradise.

For me, Sophie was the highlight of the day. She actually sold out of drawings while we where there.

In the last few weeks, Marianne Sweet and I have had a couple of quick success stories. I called in Marianne on two new listings and asked her to do her magic.

In one case, the home had been on the market previously with another agent, and had not sold. It was a lovely home, but the seller and his wife were frustrated with the lack of a sale. Marianne came in, made a few changes, and in about a month the house was under contract. Yes, we made a price adjustment too, but a review of the comps and the lack of a sale during the previous listing period told us that some changes needed to be made.

The next home was a condo in Royal Oak. I was the first listing agent and we got that one sold in about 30 days (or less) too. This in a market where the absorption rate is about 2 years for condos. We were up against stiff competition to get the listing in the first place. The seller really did his homework, bringing in 3 agents and stacking up their marketing plans and experience before he made his choice. I always like being competing for a listing. I think we have a lot to offer, and when a seller goes to the effort of bringing in a couple of agents, then they really see the difference.

Any, at closing, the seller gave me the ultimate compliment. He was thrilled with the quick sale, close to asking price and he said,

“You told us exactly what to do, and it worked!“

What had I told him to do?

Marianne is headed out again this week to do her magic on another new listing. I am hoping that we will soon be reporting another quick sale, this time in the Village of Franklin.

People keep whining about how difficult this market is. I don’t deny that it is extremely challenging to be a seller in Southeast Michigan right now. But there are many things a seller can do to get a sale. Get a listing agent who will guide you, take her advice, and you may just find yourself moving much sooner than you ever thought you would.

Ken Mascia’s recent post on the Mortgage Relief Act resulted in some good questions about exactly what the new law does for home buyers. This week Ken was even featured on the front page of the Oakland Press, where he further opined on the topic. We are always delighted to see Ken’s name in the paper.

Everyone heard about the $7,500 credit, but there are some important caveats that you need to be aware of. The most significant being that the tax credit is actually a 15 year interest free loan. That means you pay it back over the course of the 15 years. Still, that’s not at all a bad deal. I would take it in a heartbeat if I were eligible. Free money for half of the life of an average mortgage is s-w-e-e-e-e-t! I promise you, you will not find a similar offer from Countrywide or Chase.

Here are a couple of super resources for direct answers to the questions you may have about the credit as a first time home buyer.

From the National Association of Realtors:

If you bought a home since April, you may be eligible for this credit. If you are thinking of buying a home, this might help to make that decision a little easier. If you know someone who is buying a first home, pass this along to them. Better yet, have them call me

Metro Detroit has it’s own celebrity foreclosure. It might not attract national media attention like Ed McMahon, but then we already have Mayor Kilpatrick garnering the spotlight from late night talk show comedians, so what more could we want?

Wayne County Prosecutor Kym Worthy is doing a short sale on her home. Personally, I don’t think this would even be newsworthy if she didn’t happen to be heading up the case against Kwame Kilpatrick. Perhaps the Mayor’s office slipped this tidbit to the Freep so that they would take the heat off of Kwame for a day or two, and to shake up Worthy just a bit.

I have no information about Kim Worthy’s foreclosure. Frankly, I think I would be hard pressed to find a neighborhood in Southeast Michigan right now that has not been touched by foreclosure and short-sales. We’ve seen multi-million dollar homes go through foreclosure. In fact, this summer we listed and sold a foreclosure in Birmingham that had been listed for $2,000,000 at one point.

Worthy has a good job. She makes over $150k a year. Yet something happened that is not allowing her to pay her bills. No judgment from me–I am sure there is a good reason. Medical bills and messy divorces often leave people in financial dire straits these days.

Ask anyone who has been through the short sale process as a buyer or as a seller, and they will tell you it is painful. Worthy is losing her home. Her credit is messed up. It will be messed up for a while. On top of that, she is in the midst of preparing for THE CASE of her career. I don’t envy her right now.

I wish her the best and hope she can focus on making sure that she represents the people well in the case against Kwame Kilpatrick.

Photo by SparkyO5

Two weeks ago Dmitry and I took a day and headed down to the outskirts of Cleveland (about 150 miles away) to pick up a brand new car that was made about 70 miles from our home.  The car had to pass by our home to get to the dealership in Cleveland.  Ironic, right?

We were educated buyers.  We knew what we wanted.  We had the benefit of being able to pay the GM Employee and Family rate so there was nothing to negotiate.  We just wanted a new 2008 vehicle, configured the way we wanted it.  We did not want to special order and wait.

We spent a couple of hours sitting across a desk from a dealer in nearby Troy.  He did a search on the computer and told us the car was not available within 50 miles.  Apparently his dealership only trades cars 50 miles away.  Too bad for them.  They lost the sale.

A few nights later I went on AutoTrader.com.  I found exactly the car I wanted.  I clicked on a button and inquired about it.  The sales manager, Steve, answered all of my questions quickly. We passed back and forth 10 or so emails and decided to buy the car.

I really wish that I could have bought it locally.  It would have been easier for me, of course.  Though next time Steve says he will bring the car to me, so he has eliminated that barrier.

Steve’s dealership was simple and the opposite of ‘glitzy.’  But I got the service I wanted: quick, honest responses to my questions.  Steve, like me, is attached to a Blackberry so that he can answer his client emails as they come in.

How does this apply to my real estate practice?  Of course, as we have long known, the Internet is empowering buyers.  We know that is important to have our listings broadly syndicated so that buyers can find them wherever they are looking.  Buyers still want service too, even when they “find” the house.

As a buyer I was looking for someone to supply me with the car I wanted.  The guy in Troy couldn’t do that.  The guy in Cleveland figured out how to let me know what he had, and he gave me the answers I wanted when I asked.

I find the car buying process overwhelming.  I don’t know much about cars and, honestly, I don’t care to know much about them.  My basic questions are: what color is it?  And, does it have heated seats?  I like that my car came with OnStar, and XM radio but they did not influence my decision. I think I might feel like a lot of home buyers feel when they begin the home buying process.  It is intimidating.  A hugely expensive purchase.  I hope that as a Realtor I am able to take out some of the intimidation factor for buyers.

Oh, and by the way, if anyone might be interested in a well priced, loaded 2002 Cadillac Seville STS with less than 54K miles on it, give Dmitry a call at 248.961.0802.

Yesterday I spent a few hours sitting at a booth at the Birmingham Farmers Market with Rebecca Meisner from Weir Manuel.  Our group, the Birmingham Bloomfield Realtors Network, is a sponsor of the market this year.

One of the people who stopped by to chat with us picked up my card and said “If I see a Sotheby’s sign, I know I can’t afford the house.”

Phew! Most likely, NOT TRUE.

Yes, our Sotheby’s office is fortunate to have many gracious luxury homes amongst our listings.  Some of Oakland County’s finest homes have been sold by Sotheby’s agents.

But our Sotheby’s office serves all segments of the market, from rentals going for $1,000 a month, up to $10,000,000 lake front estates.  I think the distinction is that our Sotheby’s agents strive to offer exceptional service and superior market knowledge to whomever we represent, regardless of the price range.

You may see a lot of SKBK Sotheby’s signs in Birmingham and Bloomfield Hills, but you will also find plenty of them in Royal Oak, Troy, Beverly Hills, Berkley, and throughout Metro Detroit.

I intentionally hadn’t much mentioned the trip to the Dr.’s office today because I did not want her to get all worked up.  But when the topic did come up as she got dressed, I showed her the pictures of Dr. Molly’s on Molly’s blog.  Looks pretty cool.  No stuffy lab coats.  No scary looking equipment.

Filled with funky bean bags, and other kid’tastic finds, Birmingham Pediatrics feels hip and comfortable.  Dr. Molly’s daughter Mairen greeted us and got Katya settled in with a fun filled activity pack that kept her occupied while I filled out papers.  Mairen suggested we might be more comfortable over in the bean bag corner.  When Katya wanted to take a look at the Kresge Farm out of Dr. Molly’s private office, Mairen took her right in and then told her that Katya would have binoculars in her exam room.  Actually, I don’t think they call ‘em exam rooms and they don’t look like exam rooms.  There was no table with a roll of paper on it!

Katya had a great visit.  Tonight she told me she loves Dr. Molly and asked when she could go back.

Dr. Molly has figured it out.  Your kids will love you for taking them to see her.

You can follow Dr. Molly’s adventures on her blog

Birmingham Pediatrics and Wellness Center

Molly O’Shea, MD, PLLC
3270 West Big Beaver • Suite 400 • Troy, MI • 48084

248 816 2558