Formosan Termites - An urban legend?

Sort of.
No doubt many of you received that infamous email about these termites being embedded in hundreds of thousands of bags of mulch from trees downed by last falls southern hurricanes.

While it is true that this larger species of termite is more pesticide-resistant than domestic termites, they are definitely not included in bags of mulch from Lowes or Home Depot and couldn't survive a winter here in Ohio if they were somehow transported here.

They were introduced to Gulf port states some 50 years ago on ships from East Asia and although they can migrate on their own, they are usually spread primarily through human transport.

Your garden variety termite is still a big deal though. Termites do more than $1 billion in damage each year and not a week goes by when I don't hear a story that has to do with termite damage. Most lenders require a termite inspection prior to authorizing your mortgage. Even if it isn't a condition to your mortgage, have a termite inspection done by a certified inspector. This picture shows what termite damage may look like in a floor joist or ceiling beam.

Single Women Make up 21% of all buyers

I mentioned here about 15 months ago as I noticed that a good amount of my clients the previous year were single women. It turns out 21% of all home buyers last year were in that category. That's more than twice the rate of single men across the country, according to the National Association of Realtors.

Low mortgage interest rates, lots of homes on the market and higher earnings may be some of the reasons why women are buying homes but I've not read or heard the answer to the obvious corollary -- why don't more single men buy homes for themselves? Is it just some sort of natural phenomenon? Are single men home-adverse? Are they financially unstable or uninformed?

Here's something that may explain a little of that: Maybe it's because of the 4.3 million Americans age 25-34 who are still living at home with their parents, about 63% are men.

According to a Sears study, about 85% of women have been, are, or expect to be soley responsible for a house within their lifetime.

It's planting time: Columbus Ohio Gardening 101

It's time in Columbus to put the vegetable and other gardens in. The potential for overnight frost is all but gone.
I am a big fan of a backyard garden, though I admit it's harder and harder to find the time to devote to such indulgences.
If you're not sure what to do or how to go about it, the HGTV link below takes you to a good basic Q&A page with lots of great advice and hints for the beginning or experienced gardener.

A perennial flower/tree/shrub garden with lush landscaping is a big attraction to home buyers who won't have to do much but wait for mother nature to do her thing. If you don't have one but are considering selling your house in a couple-few years, then it might not be a bad idea to start one this year.
Make sure you have color from early spring to at least late fall. Also make sure it isn't too intimidating to potential home buyers to keep the garden going.

While I'm at it, I'll come out of the closet on HGTV. I'm a sucker for a couple of their shows, especially House Hunters. Sad but true. I do it all day long and then I come home and watch other people do it on TV. What can I say, I'm a real estate junkie. Of course, that's not a bad thing for my clients.

Basics - Gardening for Beginners, Tips, Videos & more : Home & Garden Television

Absorption Rate - How long will my house be on the market?

Although many sellers expect Realtors to carry around a crystal ball and peek into it when setting prices and setting expectations for the sales process, the truth is we can only rely on what the market tells us, experience and knowledge.
One tool sellers can use to estimate time on market and temper expectations is Absorption Rate.

To calculate Absorption Rate, divide the number of listings by the number of sales during the last month. Currently, the Columbus real estate market has 17,186 homes and condos on the market. From April 17th to today, 2197 homes or condos have sold, making the absorption rate 7.82. While certainly not scientific, it is a decent off the cuff barometer of what to expect in a market. An average seller in Columbus can expect that, if there were no more new listings, that it would take 7.82 months to sell all the current listings on the market. That's up an entire month from about 45 days ago when there were about 1200 fewer homes available.

Let's take a quick look at the absorption rate for some different markets:

Upper Arlington ohio homes - 6.28
Bexley ohio homes - 5.8
Greater Olde Towne East homes - 10.63
Westerville ohio homes - 6.49
Worthington ohio homes - 6.59
Grandview ohio homes - 3.5
Downtown Columbus Condos for sale - 5.75

It goes without saying that all homes are not created equally. Nor are they priced equally well. In today's tougher seller's market, Sellers must have realistic expectations of selling price, time on market, and what to expect throughout the process. Their homes have to be clean, clutter free, smell free and as well cared for as possible.

The state of the state of the market?

Let's use Clintonville as example. Considering Clintonville proper and using more or less Glen Echo to Morse Rd and the river to the tracks, there are about 200 homes for sale.

Three are above $500,000---529, 835 and 1.195 mil
22 homes are listed between $309,900 and $459,00
81 listings in the $200s from 204,900 to $299,900

That leaves 93 listings under 200 thousand dollars.

44 properties have gone into contract this month
5 of those had home sale contingencies
while 12 more moved from a contingent status to a firm "under contract" status.

So, Of all the properties that could be on the market, 23.4% of them are in contract.
Of the 29 properties that have a contingent status (upon financing or inspections usually) the average days on market are 50 days and the average price per square foot is $145.42

In May of 2004, during a great time to be selling a home, the average days on market for this same area was 58 and the average price per sq.ft. was $136.03/sqft. Add two years of appreciation at aprox 3.5%/per year and account for the current stiffer market facing sellers and there you have it. The more things change, the more they stay the same.

Is the market tough for sellers, yes. Is it good for buyers, yes. Are sellers having to sacrifice like crazy, not always. Are there homes going into contract quickly, yes--this month some Clintonville ohio homes for sale went in to contract in 4, 6 7, 8, 9 and others under 30 days. You need a good agent to get those too, by the way.

What does it all mean? While Clintonville may not be the perfect example market, the point is that despite all the hype of a real estate bubble and the housing market being soooo soft, it's a good time to be buying or selling a home in columbus, ohio.

Fed raises interest its target for the federal funds rate by 25 basis points to 5 percent

It was announced today that Ben Bernanke and company raised the rates again, for the 16th time in a row.
The raise applies to the amount of interest banks can charge each other for overnight funds, but indirectly impacts other interest rates as well.
It seems many people believe that this means you'll pay more every month for your mortgage starting tomorrow. There is a trickle down effect that touches everything from the greater economy to your car loan to your mortgage payment. It's gradual though.
You can walk into any bank today and receive a mortgage, assuming decent credit history and moderate income, with about 6.5% interest.
What does that mean to you every month?
Each ten thousand dollars worth of home will cost you about $65/month in a mortgage payment. So, to extrapolate, a $200,000 home for sale in Bexley will cost about $1300 principal and interest. Of course taxes and insurance are tacked on.
Taxes differ by municipality and insurance is generally less than most people think, usually under $100/month.

IRS Rules Downpayment Assistance Programs Essentially Illegal

This is a big deal and a bit of blow for those who need to use the looser debt to income ratio and income guidelines that FHA allows.

I was a little surprised to learn that about 1/3 of all FHA loans use these types of programs. The best known include Ameridream, Nehiamiah and Neighborhood gold. I agree that it's always been a joke that these "non-profit" organizations take a big fee and exist only to be a loophole for these buyers to obtain the best financing possible in ways they otherwise couldn't. On the other hand, I've seen them help my buyers buy a home for sale in columbus.

In a nutshell, the seller pays around 3% of the contract price to buyers for their downpayment and around $500 of that goes to the program. the Buyers are get around not being able to have a Gift for downpayment and the seller sells their house.

IRS Revenue Ruling Restricts Nonprofit Downpayment Assistance Programs Funded by Property Sellers

On May 4, 2006, the Internal Revenue Service released Revenue Ruling 2006-27 which will eliminate the 501(c)(3) status of a large number of nonprofits who receive funding from property sellers in providing downpayment assistance to FHA borrowers.

FHA regulations require that nonprofits providing a downpayment gift have an IRS 501(c)(3) exempt status. Due to the ruling, the IRS has indicated that it is investigating 185 organizations that provide downpayment assistance.

Nonprofits that receive funding from parties interested in a home sale, and who receive payments from home sellers correlated with the amount of down payment assistance, are most vulnerable to losing their tax-exempt status.

Conversations with FHA have indicated that they will insure loans with DAP assistance provided that the homebuyer has entered into a contract of sale (including any amendments to purchase price) on or before the date the IRS officially announces that the charitable organization's tax-exempt status is terminated. FHA will recognize the gift--if made to the homebuyer and properly documented--as an acceptable source of the downpayment.

FHA seems to believe this policy avoids harm to any homebuyer who, in good faith, has a contract of sales and anticipates receiving a gift for the downpayment from such a charitable organization.

Currently, about one third of FHA single-family purchase loans have the type of downpayment assistance that the ruling may affect. Such downpayment assistance programs have served FHA's primary clientele: first-time homebuyers, low- and moderate-income families, and minorities.

The IRS ruling makes passing the flexible downpayment provisions of H.R. 5121, "The Expanding American Homeownership Act of 2006," more urgent if FHA is going to continue to provide these targeted populations with affordable financing.

Buyers Regret Not Asking: Anyone Die Here?

I ran across this today from the national association of Realtors. There is always some lively discussion when it comes to the question of divulging things that may have happened to people in the house. Murders, suicides, other crimes, or just someone passing away of old age is it obligatory for the listing agent/seller to disclose this to the buyer? My experience is that it would never have mattered to the homeowner had they not known.
But knowing something happened in the home does freak out some people and it sends others away no longer considering the house as a viable option.
Just last month I closed on a condo with a great young woman, it's her first home. All we knew was that an elderly woman lived there and that she was the original owner. AT THE CLOSING TABLE, we find out that the woman was agoraphobic and NEVER left the house in 30 plus years and died in the home. My buyer was asked to sign a sheet of paper saying as much. It didn't bother her too much but she'd rather not have known.
Funny thing. Many people believe that if the incident in question was public knowledge, then the seller does not have to disclose. I'll post some authoritative opinions soon. In the meantime, here's the article which is pretty vanilla:

REALTOR� Magazine Online -Daily News- Buyers Regret Not Asking: Anyone Die Here?

Selling & Buying in Columbus? Some things to think about

The daily reporter today had a great article about selling your home and buying your next home and the stress that goes with it.
The way I do things is like this:

• Take the sellers out and show them some homes they might like
• If they find some they like, chances are they'll find some when it's REALLY time to look
• List their home -- Assign them the task of finding their new home with my tech tools and just driving around, looking at open houses, etc.
• Put their home in contract
• Go look at homes they already are ready to see because they've been watching the market
• Put new home in contract
• Close on old home
• Close on new home

Of course, if they've fallen in love with the 'new' home, a bridge loan sure comes in handy. You should see what lenders can do with bridge loans these days too, unbelievable. I like them most for people moving into Columbus or people moving out town.

Here are some highlights from the article ----

Putting a house up for sale can be a stressful experience.
According to RealEstate.com, the endeavor is even more taxing for those who are simultaneously selling their home and buying another, prompting the home listings provider to survey 550 such homeowners about the unique challenges they face.

"Many people underestimate the emotional overload of selling one home and buying another at the same time," said Holly Slaughter, consumer experience expert for RealEstate.com."That sense of uncertainty, which is always present to some degree during a home sale or a home purchase, is basically doubled for bridging homeowners," she said.

"The only antidote is to spend some time planning for contingencies and to set your expectations realistically."

Forty-two percent of respondents said the uncertainty of knowing how quickly their home would sell was difficult or more difficult than expected.

Nearly 70 percent said they were "worried" during the selling and buying process and 67 percent said they were "hesitant."

Most people do not buy and sell houses every day, so their unfamiliarity with the process tends to get the best of them, said Chris Reese, president of the Columbus Board of Realtors."That's why they need to get in contact with a Realtor to get that series of events in place," she continued.

Sixty-two percent of those surveyed were successful dual-closers, meaning they were able to close on their existing home and move into their new home without a significant lapse in time. The remaining homeowners either had sold their homes but had not yet closed on a new one, or had closed on a new home but had not yet sold their original home.In addition, the survey revealed that 48.2 percent of all respondents agreed or strongly agreed that the dual negotiation process was taxing.

About 53 percent of those respondents were women, while 42.2 percent were men."For most bridging homeowners, success means moving seamlessly from one residence to another, since most of us don't want the hassle of living in temporary housing or the expense of paying two mortgages," Slaughter said.

Nearly half - 47.1 percent - of respondents agreed or strongly agreed that getting their home in sale-ready condition took more time and energy than expected.Once owners begin sorting through all the things they have collected over the years - the first step to getting a house in order - they can begin to feel overwhelmed about moving out, Reese said.

The majority of the bridging homeowners surveyed, 78.2 percent, had no regrets about the process. However, if they had to do it again, 9.9 percent of men vs. 8.8 percent of women, were more likely to say they would have sold their existing home before making an offer on a new home.

"For bridging homeowners, there are a lot of moving parts," Slaughter said. "But the good news is, there are some simple things they can do to smooth the process."

The full article can be found here:
CENTRAL OHIO SOURCE - The Daily Reporter, Inc.: "Bridging homeowners face unique challenges when buying and selling
Bridging homeowners face unique challenges when buying and selling MELANIE MCINTYREDaily Reporter Staff Writer05/04/2006

Freakonomics Blog � Realtors Get a Blog

Another stat from NAR, one in which they led off the introduction of their own blog with.

Real estate professionals do more for sellers than make the transaction easier. They make them money. In fact, the average seller who uses a real estate professional makes 16 percent more on the sale of their home than do sellers who go it alone. That’s an average of $31,800 per home.
That’s one reason the level of unrepresented sellers has declined steadily in recent years. Despite five consecutive record-breaking years for home sales from 2001 through 2005, the level of unrepresented sellers has dropped from a cyclical peak of 18 percent of the market in 1997 to a record low of 13 percent in 2005, according to the 2005 National Association of REALTORS® Profile of Home Buyers and Sellers.
Real estate professionals assist both sellers and buyers with the services necessary for a successful real estate transaction, especially pricing and marketing. Real estate pros can help price the property accurately and market it successfully using the variety of tools available today -- Internet, print, word of mouth and more. REALTORS® know best how to prepare a home and maximize value, provide broader exposure to the market and are more likely to generate multiple bids than a seller on the own.
In addition, REALTORS® are experts in attracting qualified buyers. A professional can show a home more objectively than can a seller who may be emotionally attached to the home, and who might become unnerved by prospective buyers’ critical comments. The real estate pro also checks the financial capability and bona fides of buyers before allowing them onto a seller’s property.


Every market is different and it'd be hard to know the accuracy of the study because you can't sell the same house twice in the same market. Ask any For Sale By Owner (FSBO) though, and they'll tell you what a hard and almost impossible job it is to go without a Realtor.

Notes from Online Real Estate Studies

According to a California Association of Realtors 2005 paper,
21% of on Internet buyers expect a real estate sales associate to respond instantly to an inquiry.
23% Expect a response within 30 minutes or less

But, According to Realtor.com, only 27 percent of practitioners responded within EIGHT hours to an inquiry from Realtor.com and a stunning 46% of inquiries NEVER received a response.

Wow. Right about now you may be thinking, "Boy am I glad that I'll be using Joe Peffer to help me buy or sell a home in Columbus." While I can't always guarantee an immediate response, I will guarantee that I'll get back to you within the hour if at all possible and never more than 24 hours from your inquiry.

I am very technologically tuned in. I believe it helps my business, promotes my professionalism and keeps my clients more than satisfied. They are the reason I spend the money every month to have a blackberry. Client calls and client emails, along with email inquiries from would-be clients are answered ASAP.

Of course there are times when I am with my clients, showing homes, explaining offers, making offers, attending closings, etc. The only time I answer the phone when I am with a client is if I think it has something to do with that particular client. For example, if I never heard back from a broker regarding whether or not I can show a house while we are out looking at another house, I'll take that call.

technology skills, communication skills, marketing know-how, an empathetic go-getter . . . . why would you use any other Columbus Realtor?

Mortgage Credit Certificate Program

This is a super deal that sounds too good to be true. In reality though, it's the real thing. If you are buying a home, especially in a targeted area, be sure to ask your lender about this program. Fist come, first served, I believe.
As always, use programs like these responsibly.


2006 MCC Tax Program
Mortgage Credit Certificate Program

How the program works

The MCC increases a household’s disposable income by reducing its federal income taxes. A reduced tax burden will free up more income to help households qualify for a mortgage loan and meet loan payment requirements.

With an MCC, 20% (25% target areas) of the mortgage interest is a tax credit – a-dollar-for-dollar reduction of income tax liability for the life of the loan. The remaining 80% (75% in target areas) mortgage interest continues to qualify as an itemized tax deduction for the homebuyer.


For example:

Targeted Area: $100,000 x 6.5% x 25% credit = $1625 year or $135.42/mo

Nontargeted Area: $100,000 x 6.5% x 20% credit = $1300 year or $108.33/mo

Income and sales price apply call me for details

This amount we can take off of the borrowers payment to qualify them.

For additional information call Randee Estep – Branch Manager

Randee Estep
Branch Manager
Colony Mortgage Downtown
781 E. Main Street
Columbus, Ohio 43205
614-221-2100
614-402-0140