Darryl T. Agostinelli on Real Estate

Community Impact Newspaper

darryla — Sat, 07 Jul 2007 05:18:00 GMT

Many North Austin Suburban residents are probably familiar now with the Community Impact newspaper which reaches your door. If you toss it out with the rest of the junkmail, stop now! I have been reading it regularly since it became coming to me about 2 years ago. I find it to be great. It's far more useful and relevant to me than television news and even the Austin American Statesman.

Here's a Web Link

A few topics of choice in the past have been the toll roads, the new amusement part, the new commuter rail and other real estate and small business developments. They journal also talks about happenings in local government which has a far greater impact on our everyday lives than what Mr. President does in Washington.

It's a great paper. I'm happy it exists.

A distant second would be the Hill Country News. The information is less localized, and so the relevancy suffers a bit, but it's still a great paper as well.

Flipping Houses

darryla — Tue, 19 Jun 2007 20:40:00 GMT

Lots of people watch those shows on TV about fixing and flipping houses. Lots of customers come to me asking to see foreclosures or ones with foundation damage. Then they want to offer 20%-30% off the asking price. That is generally a great way to waste everyone’s time. The reason is that everyone watches those shows and knows to ask their Realtor those same questions and offer a low-ball. So what has been happening is those houses get multiple offers and then ultimately bid up to the asking price or more.

Just to test this theory, I did some historical analysis in the MLS. I looked for certain keywords in the descriptions and then computed how much “off the asking price” the final buyer got. This data is for the period between March 2007 and March 2006. Here is a snippet of the results of that research.

NOTES: If the discount is positive then they got it for less. If the discount is negative then they paid over the asking price. I actually searched for variations of the keywords and also took out the ones which were obvious false-positives.

Keyword         Discount
handyman         1.07 %
needs work      -0.4 %
short-sale         -0.02 %
motivated seller  -0.03 %
foreclosure      -0.008 %

As you can see, these houses aren’t going for 20% off their list prices. They are often listed, however, for 5% or more below market.

My point is this -- When you make your offer, look at the property relative to everything else in the neighborhood. Is it cheap compared to everything else?

Real Estate Statistics

darryla — Sat, 19 May 2007 20:42:00 GMT

In recent weeks, I have been asked often, “How’s the terrible Austin real estate market going?” or “It must be tough working in this market, huh?” I wanted to address these questions.

Thankfully people have it all wrong. The Real Estate market in Austin is strong. In 2001 and 2002 we had our real estate recession. After that we’ve had stable appreciation year after year while the rest of the country went crazy. This stability has paid off. While the bubble has burst in other places, in Austin, the bubble never formed -- so there was no bubble to burst!

The chart in the attached document shows a mathematical average of all of the homes which were transacted under the MLS of the Austin Board of Realtors. Resale prices have appreciated 6% over last year. Before that it was a little less and before that, even smaller. 6% appreciation is actually a little fast for Real Estate. Normally, we like to see something a bit closer to 4%. But 6% happens. Compare that to the 20% or more appreciation figures you probably heard about in places like Los Angeles. 20% is a bubble, 6% is “growth”.

Some micro-markets around Austin have experienced extremely high appreciation in the last 3-4 months. One area of notable interest is Cedar Park and Leander. In a Leander subdivision called Block House Creek, if you take an average – it’s about a 10% bump. That’s extremely fast for Real Estate. While no-one can say with certainty why this has happened, we’re all guessing that it’s most likely due to the new highway and the planned development for the area which includes a Cinemark, 2 light rail stations, a Super Target and an HEB-Plus.

There are other micro-markets which are going through some hyper-appreciation. East Austin is another famous one. Despite those, overall, Austin remains a strong, stable market.

ARMs causing Foreclosures

darryla — Wed, 14 Mar 2007 20:00:00 GMT

Interesting article on questionable borrowers and foreclosures:
http://www.csmonitor.com/2007/0302/p01s02-usec.html

Many people are often taken by the low rates of an ARM. It makes sense. ARMs are cheaper and they are a very cool product. But incorrectly used, they can spell disaster. Over time, the rate of the loan will increase. It may have started out at 4% or so, but after it starts to increase, it might eventually before 8% or 9% or more. Your payment will increase as well. For people who could barely afford the payment at 4%, when it reaches 8% or more, they often have trouble meeting their mortgage payment.

ARMs aren't evil as some might have you believe. In the world of investing, we have something called a "time horizon". That refers to the time in the future when you plan to exit from your investment. In the case of houses, the time horizon will be the year when you sell your home. As a real estate investment advisor and loan officer, I ask my clients "when do you think you will sell your home?". In essence, I am trying to determine their time horizon. I ask other questions such as, do you plan to have children in this home? How likely will you be to change jobs and other questions to gauge my clients' time horizons. Given that information, I make a recommendation and outline the pros and cons to each option. If my client is sure that their time horizon is just a few short years, and the rates are low enough, I have recommended the ARM and it makes sense for these people.

Unfortunately, people seem to like to use the ARM to qualify for homes they shouldn't be buying. For instance, for people who can't afford the payment for a 30-fixed loan, they see the ARM as a really neat way to get the home cheaper. You cannot have a long time horizon if you are getting an ARM! You really need to either sell or think about refinancing around the time when the rate starts to adjust.

Microsoft's Daylight Savings Time Bug Repair

darryla — Tue, 13 Mar 2007 21:45:00 GMT

Apparently, even if you are the sort of person who updates his computer regularly, you aren’t immune to this daylight savings time bug in Outlook which moves all of your appointments. Here is the official fix from Microsoft.

http://www.mailstreet.com/dst/default.asp

If you are using a PDA running Windows and you use Microsoft Outlook, you will need to read this posting.

Here Comes the Neighborhood

darryla — Tue, 13 Mar 2007 20:00:00 GMT

AUSTIN (Austin American-Statesman, Austin Business Journal) – City leaders and developer Catellus Development Corp. have selected six companies to build the first phase of the new Mueller neighborhood.

The neighborhood, which is being built on the site of the former Robert Mueller Municipal Airport, will eventually include 1,500 single-family homes, 900 row houses and 2,200 apartments and condominiums. About 25 percent of those units will be included in the Mueller Affordable Homes Program.

The builders are David Weekley Homes, Meritage Homes, Standard Pacific Homes, Saldaña Homes, Streetman Homes and The Muskin Co. Saldaña, Streetman and Muskin are locally based.

The Mueller project, which is the largest public-private venture in Austin's history, will house up to 10,000 residents. In addition, it is expected to add $1 billion to the city's tax base and generate thousands of jobs.

I'm a Full Time REALTOR Now!!

darryla — Mon, 12 Mar 2007 03:06:00 GMT

You may have heard the big news. I have decided to become a REALTOR full time! I have actually held two positions for some time now as both a Software Consultant and a Realtor. The two roles have always acted in symbiosis helping me to be more effective in both. I’ve been an active Realtor for three years. In the two years before that I was an avid investor in Real Estate. So this isn’t some hair brained idea that I schemed up last week. Nope, this one was hatched 5 years ago!

So what does this all really mean for you? It means I can provide you with state of the art services!

With 5 years experience in Real Estate and 11 years experience in software engineering, I have been able to create value added services that you will not be able to get from other agents. I have written software to locate property and build a pro-forma analysis based on computer calculated statistics such as vacancy, historical appreciation, population density, historical rents, current rents and many others. All you have to do is tell me your profile (how much you would like to put down and what area) and then my software spits out the homes in those areas which fit your profile. This works very well for both home buyers and investors.

Here is my service lineup:

FREE - Assess your home’s market value – Just send me an e-mail whenever you want to know what your home is worth and I’ll work up an electronic market analysis. This will be particularly useful when the county tries to raise you property taxes every year. You can contest the tax hike and win if you can show a Realtor’s market analysis showing that your property isn’t worth as much as the county would like it to be worth.

FREE - Recommend Home Services – I can recommend service providers such as a handyman, carpet cleaning service, painters, home upgrade construction services etc.

FREE - Recommend Related Service Providers – In this line of work I meet lots of people. People like CPAs, financial advisors, attorneys, insurance agents, etc. If you need one, I can refer you to some very good ones. I use them myself!

FREE - Notary Public – I’m a Notary Public. I provide this service free to all of my customers. If you need me to meet you somewhere just give me a call!

FREE - Help You Buy Your Next Home – Whether you want a brand new home from a major builder, a resale home or would like a builder to build a home on your lot, I can help you. This service is provided FREE to you because, generally, in Texas, the seller pays my commission, not you. If you are confused about how this works, let’s talk about it. Many people incorrectly think that if they go without an agent to a major home builder or approach a seller on their own thinking they will get a better price. To be fair, that does work in a very small number of cases. I happen to know what they are and can explain if you want to know. But most of the time, all you are doing is entering into a very complicated transaction without competent representation or guidance. This is not a wise decision. For those who really want to go it alone, I can provide assistance ala carte at a nominal hourly fee.

FREE – Advise you on Mortgages - I am a trained loan officer and I also have affiliations with several other very competent loan officers. I will educate you about the different types of loans available and show you how to compare loan packages. I will also provide you with a free good faith estimate for a loan from Apollo Lending which can save you even more money! We are similar to Lending Tree in that once we find the right loan program for you we will shop 4 or more loan investors to find the best rate we can offer!

FREE – Residential Real Estate Investing Consultation and Locating – Real Estate investing can be a very fun and very lucrative endeavor. Using my special software, I can help you find deals all over the city. If you have a financial advisor, with your express permission, I can work with your advisor to fit your real estate investment plan into your larger investment plan. I can also teach you how to manage your investment property and manage tenants. I can show you how to tactfully charge an application fee and then use that fee to pay for premium tenant screening. I use the same techniques that banks and private eyes use except I don’t follow people around with cameras.

Help You Sell Your Home – You all know about this one. If you are going to be buying a new home and selling your existing one, I offer a rebate system on the purchase of the new home. This will save you thousands.

That’s the line up!

New hospital to open in Cedar Park

darryla — Mon, 24 Apr 2006 14:26:00 GMT

SOURCE: http://www.impactnewspaper.com/www/docs/121.334

by Mandy Hobby

Triad Hospitals, Inc. is partnering with Seton Family of Hospitals in a joint-venture to build a $105 million hospital with 151 beds catered to Cedar Park and Leander residents.

Cedar Park Regional Medical Center is expected to break ground in June and open February 2008, at the intersection of the new US 183A toll road and Whitestone Blvd.

“We have a commitment to the partners and to the community to take care of the needs today and in the future,” Charles Barnett, Seton president and CEO, said. “We recognize the tremendous growth in Williamson County, and we respond when the community asks us.”

The Cedar Park Chamber of Commerce met with three hospitals before driving to Plano to meet with Triad. Because of this determination to provide for the growing community’s healthcare needs, the partnership was made possible.

“This is a great day in the history of Cedar Park,” Mayor Bob Lemon said at the press conference announcing the partnership, Feb. 28. “The Cedar Park Chamber [of Commerce] took the initiative to go out and make it possible for this to happen.”

The Partnership

According to Lemon, the Chamber began working on this project three years ago, and after a year and a half turned it over to the city of Cedar Park.

Triad is known for partnering with other hospitals in order to fulfill healthcare demands in fast-growing areas. The for-profit Fortune 500 company partnered with Texas Health Resources in 2005 to open Presbyterian Hospital in Denton to better serve the Dallas area.

“We knew we would not go forward in Cedar Park without a partner,” Denny Shelton, Triad chairman and CEO, said. “A single [owned] hospital is not the best strategic thing to do because of growth.”

According to Cedar Park Regional Medical Center’s new CEO, Dr. David Klein, Triad joined with Seton because of its reputable name and quality healthcare. Seton Family of Hospitals currently has 20 locations in Central Texas. Klein considers it to be one of the leading providers of healthcare services in Central Texas.

Experienced Administration

“We want to maximize on the good things of both Seton and Triad,” Klein said about the partnership. “We both have a lot in common: we want to be involved in the community, put the patients first and also be physician advocates.”

Klein is moving from the Presbyterian Hospital in Denton to Cedar Park to head the new hospital. His support for physicians and administration is unique because he has been both a general surgeon and now an administrator.

“Without physicians, we would never be successful,” Klein said. “The physicians provide for the patients and we want to give them all they need to serve the patient.”

Putting the Patient First

Klein said that the new hospital is being built with the patient and family in mind, with the outpatient services and fast track emergency room in the front.

“This will be a comfortable place that patients will want to go,” Klein said. “The care we will provide will not just be for the patient, but also the family because of the time the family spends in the hospital, as well.”

Dr. Oliver Lou, chairman of the Cedar Park Chamber of Commerce, is excited about the economic impact the new hospital will have on the major employers in the area.

“This hospital is a true testament to the saying, ‘If you build it, they will come,’” Lou said. “They being doctors, nurses, staff and patients.”

Healthcare Boom

Scott & White University Medical Campus will also be opening in 2007 and Seton Williamson in 2008. Both will be located off IH 35 on University Blvd. in Round Rock.

St. David’s Round Rock Medical Center, as well as other St. David’s affiliates, recently received new Chest Pain Centers and an accreditation from the Chest Pain Society. They now have new testing equipment for heart patients, allowing for faster testing for heart blockages during a heart attack.

Austin is Undervalued

darryla — Sat, 18 Mar 2006 22:17:00 GMT

Wondering if Austin is a good place to invest? This site suggests it is!

http://money.cnn.com/2006/03/13/real_estate/overvalued_housing_markets/

As a reminder, when you buy a home, you should look at the micro-market forces at work. It's fun to look at the overall market from the city level, but when you make your own decision, your proximity to movie theatres, Wal-Marts, grocery stores and your job matter most of all.

The Best Places to Invest

darryla — Sat, 18 Mar 2006 21:36:00 GMT

If you like investing, then if you read nothing else I write, read this. The information from this article comes from research performed by the renouned Brookings Institute and Virginia Tech. It describes places around the US that perhaps are the best places to invest.

http://money.cnn.com/2005/10/26/pf/megapolitan_biz20_1105/index.htm?cnn=yes

Of course, put your wisdom hat on while you read this. As a reminder, information like this doesn't particularly help with an individual's decision to purchase a home. A decision like that needs to consider more micro forces. This information serves to help guide your larger decisions, such as, "should I move to Austin" or "will Austin become a large metroplex".

This information will no doubt be extremely beneficial to commercial investors attempting to decide whether Austin is the place or not. Austin, and for that matter, just about anywhere along the I-35 corridor is "a good place to be". End of story.

This is a site about Austin, so I've pruned the list:

Houston / New Orleans - This is one that I personally don't fully understand. Since the Katrina disaster, I suppose it's a land grab if you can afford it. But I think that will stabalize pretty fast As a resident of Austin, I happen to know that a lot of people "fled" to Houston and Dallas after the tech bubble crash searching for work. Many are gone for good, but many will come back. I'm not sure that Houston will be a boom town. But again, I don't fully understand it. The people that did the research are pretty smart.

I-35 Corridor - That's the area between San Antonio and Kansas City, which includes Austin. Take a ride down I-35 and you'll see it in action. Places like Austin are nice places to live.

As an added note, Boston / NY / Washington were listed. Big surprise. Immigrants come into the US and move right into these places, supplanting the previous "natives" who emigrate away from the coast toward the interior. However, more people tend to stay than leave, increasing the population and value of the already scarce land. Where do these move to? Where it's hot and nice. It's historically been Florida and Arizona, but some move around here.

The limits for FHA loans have been increased again!

admin — Fri, 06 Jan 2006 16:13:00 GMT

The limits for FHA loans have been increased again! Great news.

One-family $200,160.00 (this used to be only 178,000ish!)

Two-family $256,248.00

Three-family $309,744.00

Four-family $384,936.00

Self-Directed IRA Providers

admin — Tue, 06 Dec 2005 01:28:00 GMT

Someone on a mailing list that I follow asked about Self-Directed IRAs. Capturing that info here. I personally use TrustETC.

The "BIG 3" in Self Directed IRAs are:

Equity Trust Company - www.trustetc.com

Entrust - www.entrustadmin.com

Pensco - www.pensco.com

Real Estate Investment Strategy #2 - For The Middle Income Earner

admin — Thu, 01 Dec 2005 14:32:00 GMT

A new article has been written about a Real Estate investment strategy. Click here for entire posting

Real Estate Links for Austin Texas Area

admin — Tue, 18 Oct 2005 19:34:00 GMT

austin isd page
you can see test scores and other interesting data

Travis County Apraisal District
to see what the county thinks of your property

Williamson CAD
Same, but for Williamson county

Travis County Open public records
Past sales and all that jazz

City Data
Interesting demogrpahic data by zip code

Article on valuing property
Not a source of data, but interesting none the less. Talks about how to
value property based on Price/Rents and Price/Income. Used like a P/E on
a stock. I was supposed to write a little article for Darryl on this, but
life got in the way.

What is a warranty deed?

admin — Wed, 05 Oct 2005 15:41:00 GMT

A warranty deed is a particular type of deed which contains guarantee statements from the seller that the house will be transferred free of something which undesirable. Usually, that means it will be transferred free of any "liens and encumbrances" such as a federal tax lien or previous mortgage.

As a buyer of Real Estate, if you get a loan from a bank, they will absolutely demand a warranty deed as well as "title insurance". The insurance is a guarantee from a title company that if the house turns out to have a lien or encumbrance, the title company ill reimburse the buyer for any damages.

Conversely, a "quit-claim" deed is a deed which just transferrs the house complete with whatever liens or encumbrances which might "cloud the title". You'd issue a quit-claim deed to a buyer, for instance, if you were in bankruptcy and couldn't continue to make payments on the house. You just want out from under it and want to walk away. You'd be "quitting your claim" on the house.

Here's a little more reading info if you're interested: http://en.wikipedia.org/wiki/Quit_claim_deed

Not sure if this one will come up (I just wrote it. They didn't have a warranty deed article) http://en.wikipedia.org/wiki/Warranty_deed