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Archive for December, 2010

Now one can hope that Greenfire can do its do and get the ball rolling with the old CCB tower, though I’m not sure that a hotel is what’s needed at that spot.  What I’d love to see is more properties developed for business incubation.

he Herald-Sun – Chesterfield partners sell bonds in time.

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Interested in buying, selling, renting or leasing real estate in Durham, Raleigh, Cary, Apex, Chapel Hill or Hillsborough NC, call Michael Sullivan REALTOR, 919-608-2372 or email MSullivan@fmrealty.com

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302 Pekoe Street Durham NC 27707

302 Pekoe Street

The Short Story of a Financial Mess

In 2005 302 Pekoe Street was listed for sale for $93,000 and it sold for $105,000 and the seller the Historic Preservation Society of Durham paid $5000 to connect the property to services and $2000 in buyer closing costs.

I was called in 2009, in the fall to look at the property and prepare a market survey for the purpose of listing and selling the property.  At that time the owner related to me that he had to sell the house in the neighborhood of $149,900 to pay it off.  He had been given all sorts of home equity money in the house by Bank of America.

The property had not been completely renovated.  The kitchen was incomplete as were the baths, the second floor drywall and the landscaping.  The home is in a nice area within close proximity to NCCU but the neighborhood has never been financially stable since most of the population is hourly workers subject to the whims of a changing economy.

At that time the house had been listed; the agent and owner started the price at $177,000 and had incrementally dropped the price down to $166,000.  My market survey at that time fall of 2009 indicated that the owner would be LUCKY to get $80,000 for the property and I indeed thought that tax value would be a more appropriate listing price, that being $69,986.  It was my opinion that this property at 302 Pekoe Street, Durham NC 27707 was NEVER worth what the owner had paid for it, let alone what Bank of America had lent out on it. 

Furthermore it was my opinion that both Bank of America and the now previous owner had speculated as to the value of this property.  302 Pekoe Street is now in foreclosure at a list price of $59,900. 

The fellow who has lost this home to foreclosure purchased the home through its listing agent.  Unfortunately, the listing agent did this buy a disservice by not really looking out for his best interests.  Of course the previous seller should never have over financed this home and Bank of America should never have lent so much money out on it.  It is a financial mess and perfect illustration of what has destroyed the real estate market in the country.   Interested in learning more, and there is so much more to learn about foreclosed and short sale properties.  Phone me, Michael Sullivan at 919-608-2372 or 1-888-574-6400 and ask for Michael Sullivan at Croasdaile.  You may text me at 919-608-2372 or email me at MSullivan@fmrealty.com  

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This is a lot of foreclosed property coming onto the market.  This will further drive pricing down I believe.

Fannie, Freddie Double Number of Mortgage Modifications | NewsGeni.us.

So, if you’re seeking a foreclosed home in Durham, Cary, Raleigh, Chapel Hill, Hillsborough, Mebane or in the entire Research Triangle Region of NC, call, text or click me, Michael Sullivan.  MSullivan@fmrealty.com or 919-2372

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There really is only one way for home building to go and that’s up.  I certainly don’t expect gang busters now or in the near future.  Credit is the difficult topic and with projections in interest rates spiking sometime in 2011 this will further cool the building industry.

Realty Times – Real Estate Outlook: Builders Regain Optimism.

Interested in buying, selling, renting, leasing residential real estate in central North Carolina, call or click to Michael Sullivan where one call does it all.  Michael Sullivan, REALTRO, 919-608-2372 mobile/text or MSullivan@fmrealty.com

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Don’t get caught

I recently read a home inspection report which was the most evasive report that I’d ever seen. The report itself was very nice, full of photos and general observations but when it came to some the meat and potatoes, I was very disappointed. Thankfully I didn’t encourage the buyers to use this inspector.

The inspector noted that the home has aluminum wiring, not in and of itself a problem, especially since the house has copper pigtails. What was disturbing is the inspector refused to comment as to whether the terminal connections to the breakers and bus bar are secure and functioning properly. All of this done with the panel box open and with enough time to snap multiple photos.

I guess he couldn’t put his fingers on the wires; no danger here if one touches just the insulation and jiggle them a little to see if they are loose. The same true with the breakers. The home inspectors recommendation; hire an electrician to evaluate. The inspector did a political dance to the left. He took the fifth and passed a very expensive buck.

The same was true of some water stains in the house. He wouldn’t say yah or nah to whether or not there were active water leaks in this home. He said, get a plumber and investigate further. I imagine that a moisture meter placed on the spots and running the water at full force during the inspection didn’t cross this guys mind. That’s what other inspectors do; so that they can then say, ah ha here’s a water leak. To be fair to this fellow, he did find a lot.

However this side stepping at over $300 for a townhouse home inspection is unfair to the buyer, the seller and the agents involved. This is exacerbated too by his sarcasm and hostility when I asked him about the homes grounding, breaker box, wiring and “plumbing leaks.” I was told in no uncertain terms to read the whole report and reference all of the links he’d placed in it. Reading the report and following the links are all admirable and well spent time tasks but those tasks still don’t answer the questions left begging, are the bathrooms leaking? Is the electricity working properly?

 I guess that I’ll have to go elsewhere to determine those answers. Care to know more about finding the best home inspector to evaluate your future home? There is more but a blog is not the venue to go into all of that. Call me, Michael Sullivan at 919-608-2372 for a free no obligation consultation where we will discuss finding the very best inspectors for you. I have 17 years market experience in the Raleigh, Durham, Cary and Chapel Hill real estate market where I have helped thousands of families find their spot to call home. You may text to 919-608-2372 or email me at MSullivan@fmrealty.com. Learn more about Team Michael Sullivan at TeamMichaelSullivan.com

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Durham, Cary, Raleigh, Apex, Chapel Hill foreclosed homes.

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Buying a foreclosed home? What you should know going into the process?

For the next two to three years those who are able are going to have their pick of the litter when it comes to foreclosed homes. The trend in the last six month of 2010 is that there are some pretty good foreclosed homes coming on the market in Durham, Chapel Hill, Raleigh, Apex, Cary and Morrisville, North Carolina. Gone are the days, for the most part of the stripped down, abused and beat up foreclosed home. Gone also are the days of really holding the banks hands to the fire and driving a hard nuts bargain.

Lesson one; foreclosed homes are by their very nature at bargain basement prices. This is where most consumers miss the boat. Many real estate consumers of foreclosed homes believe that they can rake the banks over the coals and score a really terrific deal. Banks work off a system where by an actuary puts numbers into a formula and those numbers determine, list price, sales price, concessions if any and commissions. The consumers with whom I’ve worked; who have been successful in purchasing a foreclosed home have “hit their initial offer into the ballpark.” This initial offer is typically within three to five percent of asking price and this includes all concessions. Concessions being closing costs, warranties and any other out of pocket expense the bank would be asked to pay.

Lesson two; unless the property is a portfolio property, the bank has little if any investment or money into the property. Almost all mortgage loans, including those defaulted upon are bought and sold on secondary markets as commodity therefore the bank selling the foreclosed home is a loan servicer and their exposure is in holding the home in inventory. The servicing bank is exposed if the house burns down, develops mold, is vandalized and that’s about it.

 Lesson three; what is as is where is? Simply put, what you see is what you get and what you don’t see is what you get. Here is where you need an experienced savvy buyer’s agent to help you through the process, you also need an agent who knows your market and generally this will not be the listing agent. Most REO/Foreclosed home listing agents don’t work with buyers; they represent the best interests of the bank. This is where I can help you. My 17+ year’s market experience allows me to guide you through the process. I have also sold numerous bank owned properties. Here are my responsibilities to you the buyer:

 1. Make you aware of all hidden and latent fees associated with your purchase of a foreclosed home.

a. Did you know that you might be responsible for de-winterizing and re-winterizing the property even if you don’t get to the closing table?

b. Did you know that there might be significant issues of title including un-cancelled deeds of trust (mortgages).

 c. There indeed might be hidden document fees paid to the bank holding ownership of the foreclosed homes.

d. The bank contract or purchase addendum for the property being pursued may require that the buyer pay fees normally associated with the seller side. Having these documents in hand is critical before purchasing a foreclosed home.

Lesson four; in this down economy there may be unwelcomed residents and conditions associated with the foreclosed home that you are pursuing. I have seen squatters move in during the contract period and the sheriff has had to evict them prior to settlement. I have seen foreclosed homes vandalized or stripped of copper during the escrow period. What the buyer needs to understand is that the bank is under no obligation to bring the house back to the condition that it was in when first discovered by the potential buyer. That is indeed a painful reality.

Lesson five; the listing agent will get me a better deal on this foreclosed home. Nope, isn’t true at all. Most listing agents of foreclosed homes are playing a numbers game. If you don’t buy it someone else will and they are so swamped with paperwork and reporting to their masters at the bank that they don’t have the time or inclination to work with buyers.

Interested in learning more, and there is so much more to learn about foreclosed and short sale properties. Phone me, Michael Sullivan at 919-608-2372 or 1-888-574-6400 and ask for Michael Sullivan at Croasdaile. You may text me at 919-608-2372 or email me at MSullivan@fmrealty.com

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This REALTOR believs that building starts will remain low until this nation is back to work. 

The Herald-Sun – Building starts remain low here.

Interested in buying, selling, renting or leasing residential real estate…phone, email or text me.

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