Finding luxury bargains

Dear Joan, 

I am afraid my husband is going to buy a luxury second home for us here in the Vail Valley​. I do love to visit here, and so do our children, it is just that I am the practical one in our family, and I fear it is a poor investment. We can afford it, but there are so many other places we could spend that much money and get a return on our investment that I feel frivolous spending it here. I know that it is your job to sell buyers the most expensive homes you can, but don’t you think I have a valid point?

Dear Not So Frivolous, 

First of all, we realtors that value our clients do not try to sell them the most expensive home we can. Rather, we try to find them the home they can afford and will enjoy. This necessarily covers a large price range as we work with diverse clients. We also don’t consider it frivolous to buy a beautiful home you and your family and friends will enjoy for years to come. None of us know how long we are here on earth, and to put off pleasures that are earned, and can be savored by all, is not recommended where I come from.

 

I personally think some of the best values in our area are luxury homes and outlying properties. I will tell you my reasoning. Many of our lavish homes and ranch retreats are built by very wealthy owners who had the money to get the best and build it “their way”, regardless of cost. Then, age, health, changing interests, divorce, and many other circumstance come along and they are immediately ready to sell. Most of them know they cannot get the money out that they put into it, because that was never a goal when they were building their dream home. Therefore, there are some wonderful “luxury bargains” here that you can find with a professional, experienced realtor. 

There are beautiful homes that you can buy for much less than you could buy the land, pay all the architectural fees, tap fees, engineers and contractors to build the same home on a similar lot or acreage, if you could even find a similar quality location. Lastly, I have had many real estate coaching experiences over my 29 years in real estate here, and one very successful coach, named Rick Ruby who owns The Core Training, says you should always buy the most expensive property you can afford, since quality always holds it’s value the best in down economies. I don’t have any statistics on it, but I have witnessed it and it certainly has worked for him and many others. I hope you can relax and enjoy every moment in your new home, if that is the decision you and your husband make. Best of luck to you.

Joan Harned is an owner and broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has been selling real estate in Eagle County for 27 years, is a past chairman of the Vail Board of Realtors, past Realtor of the Year, past director on the Great Outdoors Colorado Board and a member of the Luxury and Land Institutes. Contact Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or www.TeamBlackBear.com.

Originally appeared in the Vail Daily on 2/21/15 and can be seen here. 

Should I rent if I can’t sell?

Dear Joan,

We have​ moved to another state and have​ a​ home ​listed for sale​ in the Eagle/Gypsum area that has not sold in over six months. I am now getting calls to rent it every week. I really want to sell it​,​ so​ I feel​ renting is a poor second choice. However,​ we are anxious to buy a home in our new location and might be able to qualify if we rented our home there. Can you give us your insight on what direction you think the market is going so we can make a decision on this property​?​

Dear Stalled Seller,

In the immortal words of the owner of ​the international company​ my franchise is associated with​, “If a home is not under contract, the price is too high!” This quote is easily defensible, but there can be reasons the seller can’t or won’t lower the price and ​also ​more reasons why some properties take longer to sell. ​Your location, the size or condition of your home or other special factors may be reasons for no sale yet. ​I think you are wise to take into consideration the direction of the market​ to help with your decision.

If you throw out the crystal ball, and the old 8 ​ball​​ that used to have all of the answers, and just listen to the economists, ​we​ ​are still​ guessing. But we can make an educated guess.​ So ​here goes with my best guess​: Looking at this every day for the last 29 years in real estate in the valley,​ I believe ​our economy is improving at an excellent pace.​ Last week’s Wall Street Journal​ Sunday article spoke of three factors nationally that I believe support this positive theory:

2014 was the strongest year in job growth in the last 15 years;

The unemployment rate was down to 5.6 percent at the end of December, the lowest level since June of 2008;

Apartment rents rose 3.6 percent for the year, but the average rent was the highest it has ever been (since records were noted in 1980) and the vacancy rate was the lowest since 2000.

Now, if you move this information to our microcosm of the Vail Valley, I would say we can see all of these things happening here. There are many more jobs than we have had in the last five years. This is largely due to increased construction and all of the businesses construction supports. Not surprisingly, this affects the unemployment rate, which has drastically gone down, with many employers lacking employees. And, lastly, I would say our long-term rental market is as strong as it has been in the last five years, with rents rising 5 to 15 percent in the Eagle and Gypsum areas this past year.

Therefore, I would have a serious talk with your listing broker and see what price she (or he) believes would actually get an offer on your home in the next 30 to 60 days, then make the price adjustment necessary, if at all possible.​ If this lowered price does not work for you, then you might consider renting. However, being a long distance landlord has its challenges. Best of luck to you with your sale and in your new location!

Joan Harned is an owner-broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has been selling real estate in Eagle County for 27 years, is a past chairman of the Vail Board of Realtors, past Realtor of the Year, past director on the Great Outdoors Colorado Board and a member of the Luxury and Land Institutes. Contact Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or www.TeamBlackBear.com.

Originally published on 1/17/15 in the Vail Daily and can been see here.

Is Winter a good time to purchase ranches?

Dear Joan,

My family and I came for another holiday vacation in Vail, and I have finally decided to pursue my dream of owning a small ranch property in Colorado. Of course the family would like the property to be within an hour of Vail and/or Beaver Creek. So, after searching the Internet and making broker phone calls, I have found a property that might be just perfect for what I want. Here is my question: The listing broker said the property actually had other interested buyers right now. You can’t even access the property easily this time of year due to unplowed roads. Is it that likely that there are other buyers looking at this right now? I hate to sound suspicious, but this seems unlikely in the dead of winter!

Dear Suspicious,

In Eagle County there is no such thing as the “dead of winter.” Winter is our top visitor and selling season. Summer is becoming more and more popular, but still has not overtaken winter.

The Western Slope ranch land here is still a bargain for the buyers, although the market is getting a little stronger.

Let’s ​look at the facts​: You are, or were recently, here, and the desire for beautiful Colorado property was reignited in you by the winter visit. It is equally beautiful and fun here in the summer and winter​,​ and personally I love the fall. At any rate, back to your question, most of the brokers I know in this valley are definitely honest. I sell ranch property and I currently have multiple buyers interested in outlying property that may or may not have winter access. There is something very magical about a snow-covered ranch on a bright sunny or snowy day. The wildlife, the wide-open space to make your own tracks snowmobiling, snowshoeing or cross-country skiing all are true pleasures. ​That is not even considering the ranch aspect. ​

The Western Slope ranch land here is still a bargain for the buyers, although the market is getting a little stronger. The largest multi-million dollar ranches we have sold had buyers who originally came in the winter​ and saw the property for the first time then​.

My advice to you would be to pursue the property now, if at all possible. By spring, it could very well be under contract. You can see about viewing the property in various ways (snowmobile, ranger, have road​s​ plowed, snowshoe, aerial drone pictures or helicopter if the price warrants the expense). And/or you, with the help of your seasoned ranch broker, can write a creative contract that would allow you to delay closing until you could drive on the property with a series of monetary compensations for the seller to delay the closing. There is almost always a way to work out a situation where a seller wants to sell and a buyer wants to buy, if both parties are guided by experienced brokers that work toward a win-win situation. Do not pass up your opportunity without exploring your options. Best of luck to you!

Joan Harned is an owner-broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has been selling real estate in Eagle County for 27 years, is a past chairman of the Vail Board of Realtors, past Realtor of the Year, past director on the Great Outdoors Colorado Board and a member of the Luxury and Land Institutes. Contact Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or www.TeamBlackBear.com.

Originally published in the Vail Daily on 1/10/15 and can be seen here.

How to Choose Best Realtor Among Your Friends in Trade.

Dear Joan,

I have several friends that are Realtors and they​ ​​all​ work for different companies. As a matter of fact, a couple of them have worked for two or three different companies during the past few years. I have not cared about this until now, when I am getting ready to sell my property and need to choose one of them to list my ​home​. My two dilemmas are, should I choose by the company they are with or the person​,​ and when I choose, how do I tell the others I did not choose them?

Dear Friend Dilemma,

This is not an uncommon problem in a small valley where so many people have real estate licenses. Most every homeowner knows multiple Realtors. In answer to your first question, you choose by the person. If you know one friend to stand out from the others in integrity, work ethic and people skills, then that is the one. A Realtor might be with the largest, or most flashy company in the valley, but if they do not have an honest reputation, ​would rather play than take care of their business and are selfish to the point of annoying others, you will not get your home sold in a timely fashion for the highest possible price. You already know a lot of their qualities just because you have spent time with all of them. If one does not stand out, head and shoulders above the others, then tell them all you are interviewing for one of them to sell your home and ask them to please contact you to make an appointment to give you their listing presentation. If any of them don’t call to set an appointment, then that could be a clue. Hopefully, they all will call and you will have a chance to hear all of their marketing plans and experience their negotiating skills. I doubt it will be a hard decision in the end.

The very worst thing you can do is pick one without ever talking to the others and not giving each of them a chance, and having them drive by and see a real estate sign in your yard.

Now, the more difficult part is letting one or more of your friends know you have not chosen them to represent you. They may very well know they did not do a great presentation or they may realize they may not be a good fit for you or your property. It is my opinion, after 29 years of seeing all sides of this, that they will respect you for talking to them and giving them an opportunity show you their marketing and sales abilities. Even though they may be greatly disappointed, they will know that you attempted to be fair and most of all that you are actually listing your property so that they have a chance to bring a buyer and still make half of the commission. The very worst thing you can do is pick one without ever talking to the others and not giving each of them a chance, and having them drive by and see a real estate sign in your yard, or see it on the MLS “Hot Sheet,” with no warning. That is a difficult blow to friendships. Good luck!

Joan Harned is an owner and broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has been selling real estate in Eagle County for 27 years, is a past chairman of the Vail Board of Realtors, past Realtor of the Year, past director on the Great Outdoors Colorado Board and a member of the Luxury and Land Institutes. Contact Joan Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or www.TeamBlackBear.com.

Originally published 12/13/14 in the Vail Daily and can be seen here.

Low appraisal brings loan to standstill

Dear Joan, 

I am, or was, in the process of selling my home through a Realtor I respect and trust. Unfortunately, my Realtor did not bring the buyer so she had no control or ability to suggest a lender for the buyers. I am unfamiliar with the lending institution for my buyer, and worse yet, have never heard of the appraiser this lender hired. 

Now the appraisal has come in substantially different than the agreed upon purchase price. I have no idea why, and when we ask for a copy of the appraisal to look at the comparable sales (of which there are several to substantiate our price), the buyers say they do not have the appraisal, only the results, and want us to just lower our price accordingly.

The loan is at a standstill and it looks like the whole deal may blow up with us starting over looking for a new buyer. How does this happen that one uninformed appraiser has the power to do this?

Dear Appraiser Miffed Seller, 

Your question magnifies many difficulties that have come out of the government reaction to the housing bust of 2008. I do not know if the appraiser used in your situation was “spot on” with his appraisal, since we all have difficulty seeing our own property with objective vision, or if there is a substantial error there. I can explain your other concerns and the best path to take.

First, as a reaction to the housing crash that started in about 2008, part of the Dodd-Frank Wall Street Reform and Protection Act of 2010 was passed to try to eliminate close relationships with banks and appraisers, which they felt was partly responsible for the gross quantities of poor loans that were made. This act formed appraisal management companies that were to assign appraisers when the lender called, instead of the lender being able to call whomever they wanted. This, of course, caused more problems than it solved by often choosing appraisers unfamiliar with the various areas to which they were sent. 

Second, as far as getting a copy of the appraisal, the truth is the buyers do not automatically get a copy of the appraisal because, although the buyer pays for it, the lender orders it and therefore owns the appraisal. A federal law has finally been passed that says if the buyer asks, in writing, for a copy of the appraisal they paid for, it has to be given to them.

As far as what to do next, there are no easy solutions. You can have your Realtor attempt to get the comparable sales (if they truly are comparable) that you know of to the buyer’s agent to give to their lender. However, having an appraiser change his conclusion is nearly unheard of, for a lot of reasons. 

If the buyers are still willing to purchase your home at the agreed upon price, you can offer to pay for another appraisal, but only if their lender would agree to consider it. This is also a difficult process to accomplish. Probably your best bet is to try to negotiate with the buyers. 

If they really want the house, and the timing for your closing is important to you, then there usually is a way that your Realtors can make it work. In addition to marketing skills, one of the most important skills your Realtor can have is being able to skillfully negotiate compromises to keep a contract on track all the way to closing. Best of luck to you!

Joan Harned is an owner and broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has sold real estate in Eagle County for 27 years. Contact Harned with your real estate questions at Joan@TeamBlackBear.com, 970-337-7777 or www.TeamBlackBear.com.

Originally published on 11/29/14 in the Vail Daily and can be seen here.