General Index 

Framingham, MA Recent Property Sales Statistics

• Framingham had 47 single family sales last month, and 264  single family sales in the last 6 months
• Framingham had 27 single family homes in pending last month
• Framingham has 184 single family home listed as Active

With an average market time of just 74 days for sold properties in Framingham, the market is much better than it looks at a glance, or as local media might imply.  Attractive properties in good condition are selling quickly, in numbers up to and above 500K.  Sellers who wish to move could find the market very receptive to their home.  It should be noted that buyers could find Framingham a difficult market, with the best properties receiving multiple offers.

For more detailed reporting, contact me directly!

Matt Heisler is a real-estate professional and owner of Heisler & Mattson Properties. He has been selling residential real-estate for over 10 years. He has given several talks on real estate, including presentations on first-time buyer tips & tricks, and profiting in real estate investing in Massachusetts. As a Vanderbilt University alumnus, he is proud to serve the communities of Natick, Framingham, Medfield, Millis, Holliston, Hopkinton, Southborough, Westborough, Northborough, Grafton, Marlborough, Shrewsbury, Worcester, Milford, Charlton, Northbridge, Sutton, Hudson, Sudbury, Clinton, Boylston, and West Boylston. 

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

Key Things to Consider When Buying Foreclosures

Here are some things to consider if you're thinking about purchasing a foreclosure.

Can Real Estate Agents Help Buyers Purchase Foreclosures?

I get asked quite often if I "do" foreclosures. Of course! There's no law against getting consulting advice when buying an asset. My job, primarily, is to make sure that you understand the risks of the property you are buying - and foreclosures are all about risk. Quantifying and understanding that risk separates winners from losers.

Is Buying A Foreclosure a Great Way to Make Money?

Yes, and no. Foreclosure investing is not for the faint of heart, nor is it a good idea for people who are have limited access to cash, and its generally not a good idea for people who don't know which end of a hammer to use. It may be the best way, i.e., have the highest return, for a retail investor to make money, but it's not the easiest.

Should I Buy A Foreclosure to Live in To Save Money?

You can certainly try, but in my experience, most people don't "want" the foreclosures that are out there. Most foreclosures are not neighborhood homes in nice condition! They are usually next to highways with failed septic systems, busted pipes, or next to graveyards or commercial zoning. They usually have an issue that makes them a compromise to live in. Perhaps whatever drawback the house has is a non-issue for you, and that's fine, but you still want to make sure you don't get in over your head. You can save some money going this route, but you can also lose money by purchasing a foreclosure. There's no guarantees here.

Why Are Foreclosures Risky?

Well, most homes are in foreclosure for a reason, and that reason has precluded them from a traditional sale. Again, most foreclosures are not "nice houses".  They are often houses that have troubled locations and/or condition issues.  There are exceptions, to be sure, but homes that do not suffer from these items are usually sold very close to market value, negating your purpose: Making money.  If you buy a home in good condition at market value, you've limited your opportunity to improve it and make money.  So if the goal is to make money, you have to buy a home that has the "right kind" of issues, namely issues that can be fixed, and fix them. To do so requires cash. Some properties, in today's environment may have additional risk that involves the bank's ability to deliver Title.  If the bank hasn't foreclosed correctly, you may find that you have to give the property back.

Can I borrow money to renovate a Foreclosure?

That really depends on the house and your credit profile, but even if you CAN, it is generally a limited amount (10-45% of the purchase price).  Home fix ups for foreclosures, especially those sold at auction, can have problems that are much more expensive than that.  If you buy such a home, and run out of money fixing it  up, you'll be the one getting foreclosed on, and that, my friend, is not where we want to be. 203K's and HomePath Mortgages are both federally back programs that are available currently.

Buying a Foreclosure means risk and work, but what else?

It's time to separate the good opportunities from the bad ones. Let's face it, most homes, if priced at $1, are a good deal.  Most homes, priced at $2 Million, are not, so figuring out what your property is worth all fixed up is an important first step.  Many times, our goal here will be to flip the property, so understanding actual market value, not a theoretical value, is ENORMOUSLY important.  No surprise recommendation here, you should be working with someone who prices property for a living.  Then you need to figure out how much work it needs, in $$, and then figure out what profit you want, estimate you carrying costs, and after figuring that out, can now discuss a bid for the property that makes sense.

How much money can I make when buying and selling a foreclosure?

It really depends on how well you do the first step, but done properly, you should be able to net 25-100K per home. Any more than that, and you'll lose the property to someone else. There are other factors too, the demand for these types of properties, etc.  Properties that are less risky, and easier to move, will generally not receive the hefty profit margins.  Of course, I've seen many, many people lose money by (most commonly) NOT understanding the property they were buying was risky.  Also, some folks over-upgrade, by putting nice things in the house that either won't enhance its value or won't increase it enough to justify the expense.

How Do I Know What Should Be Fixed Before Selling a Foreclosure?

Again, it really useful working with someone who can help you out.  Specific Realtors who are knowledgeable about this process (and less than 10% are) are your best source of information, as they are out in the market listing and selling these homes.  They typically are aware of what buyers will pay for, and what they will not.  Once you get the hang of it, you can probably do it on your own, but a knowledgeable partner can reduce your risk significantly, and probably help you increase profits.

Q: Are there other things I need to be aware of when buying a foreclosure?

Municipal liens, tenant situations, condo fees, and many other specialty items that may or may not apply in your case.  Not to mention, how the property is sold makes a big difference in negotiating strategy.

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

With most of us in urban areas, I have many customers that have never had well water before, and often have concerns about what they need to know.  While not exhaustive, I'll try to post the fundamentals here.

COST:

The really good news is you won't have a water bill.  If you're getting water out of a private well, it's yours, so no fee.  Most experts expect the cost(s) of municipal water, or town water (same thing) to go up in the future, so this could be a real positive going forward.  The bad news is the water in a well doesn't come out on it's own - it's pumped out, and generally has a small reservoir system to keep the pressure steady. Both of these components can, and do, wear our and need maintenance/replacement over time, so a home owner learns to keep an eye on them just as they must with any other mechanical system.

RELIABILITY:

Many wells do require power to operate, so if you do lose power, once the reservoir is empty, you may lose water too.  If you are in an area where power outages are frequent and not short, you may want to consider a battery backup of generator solution.  Battery backups can be just for wells, and generators are really a more full service (and expensive) solution. Generally, town water has the services to keep water pressure coming even during outages.

PRESSURE:

Pressure can be worse or better than municipal flows, but in general is not a concern.  As noted above, the systems can help regulate pressure, and there are other tricks (like the faucet heads) that can simulate or increase the pressure should you desire it. All wells should have a pressure test, generally paid for by the buyer, at inspection time to make sure their are no issues here.  If there are issues, they can usually be corrected, but depending on the pressure issues involved, they can be expensive, so it good to know the projected cost before you move in. City Water can have low pressure - which requires in house systems to fix - or can have pressure that's too high - which most home owners fix with a pressure regulator.

SAFETY:

Well safety is about both biological (bacteria) and chemical factors.  All wells should be tested for water quality at inspection time as part of the purchase process.  Most issues are easy to fix, but some are not, and generally the tests will give you the peace of mind you seek as to the safety of the water. Well owners should re-test on a regular basis (yearly is often suggested), especially if their communities are in at-risk areas for certain containments.  Note that "standard" testing packages oftentimes may not include important, but more expensive tests (like Arsenic and Radon) that I recommend ALWAYS be tested. These relatively uncommon water issues are expensive to fix, and can be health problems to boot. When found as part of the inspection process, it is not uncommon to have the seller mitigate these items. Discuss with your agent which tests you need to perform, and review the quality report diligently.  Once you sift through it, you'll be more knowledgeable about your water (a good thing!) and well prepared to move forward with your purchase.  Most town water is tested regularly, and is often treated with minerals and occasionally chemicals to keep the water clean and safe.  Salts to soften the water and fluoride to help prevent cavities are two common elements that often are added to city water.

Do Good Things Today! Matt Heisler

• Natick had 21 single family sales last month, and 154 single family sales in the last 6 months
• Natick had 4 single family homes in pending last month
• Natick has 103 single family home listed as Active

Sales remain strong in Natick, and inventory is tight.  Potential Sellers who wish to move should consider listing in the fall market, with low rates and tight inventory, it could be a good market for you!  Potential buyers should understand that desirable properties in good locations will move quickly if correctly priced, and bidding wars may occur in some instances.

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

Do Good Things Today! Matt Heisler

January 5th, 2011

Top Articles

Do Good Things Today! Matt Heisler

11/18/10

• Westborough, MA has 70 (vs. 78 in last report) single family home listed as Active
• Westborough, MA had 67 (vs. 66) single family sales in the last 6 months, and 11 single family sales last month
• Westborough, MA had 2 single family homes in pending last month
• Westborough, MA has an Average Market Time of 111 days (vs 99) for sold properties
• Westborough, MA has an Average Sold Price of $ 461,000 for sold properties

The Westborough Market has stayed tight, with just 70 active homes on the market. The midpoint of the actives is right at 550K, so if you're looking under that number, expect the market to be much better for sellers - and tougher for buyers. With the DOM softening a bit, Westborough is looking a little bit more like neighboring towns, but I would expect things to get tighter quickly next year if the inventory doesn't move up, as the inventory remains restricted for a town of this size.

For more detailed reporting, including breakdowns by price range, contact me directly!

Matt Heisler is a real-estate professional and owner of Heisler & Mattson Properties. He has been selling residential real-estate for over 10 years. He has given several talks on real estate, including presentations on first-time buyer tips & tricks, and profiting in real estate investing in Massachusetts. As a Vanderbilt University alumnus, he is proud to serve his local community.

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

8/20/10

The Westborough market is showing signs of loosening up slightly.  It remains competitive, with average market time of active properties at 147 days, and sold properties at 99, good properties are moving quickly.  Properties with condition issues, price issues, or location/lot issues are not moving as quickly.

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

How exciting for you!  You just signed an offer to sell your home.  You may have an good sense of where things go from here, you may not.  But lets delve into the most typical scenarios here so you can be prepared.

1.  Home Inspection

2. Purchase and Sale

3. Appraisal

4. Financing

5. Close Preparation

6. Close

Step 1: After a Real Estate Accepted Offer is the Home Inspection

The buyers will hire someone to come inspect your home, and this inspector will just have WONDERFUL things to say about your home.  Mostly.  He will, of course, point out many situations that "could be better" or "should be safer" or "will save you money tomorrow, if you fix it today". All of these, and many others, are fair game for your home.  There are SO MANY things that can come up in an inspection, I couldn't begin to address them all here.  But, typically,  buyer and seller will agree that certain defects either need to be fixed (by the seller, at the sellers expense), or buy the buyer (also at the sellers expense via a credit off the purchase price - typically).  Bottom line, as the seller, be prepared to have someone ask you for money!

Step 2: Negotiate and Sign the Purchase and Sales Contract

Now that we have that nasty business out of the way, its time to get the P & S done.  The P & S is usually done opposite the offer.  The seller drafts it, the buyer changes it, and when everyone agrees, the buyer signs it, delivers his "large" deposit, and the seller countersigns.  In many cases, the P & S supersedes (that is overrules) the offer.  Once both parties have signed, typically the offer no longer is an agreement between the parties, so this becomes the record of the agreement.  Where the offer is 1-2 pages, this agreement typically is 8-14, so there's a lot more detail here.  Most times, attorneys are in place on both sides, and the quality of the agreement typical reflects them, so choose carefully, and understand what you are agreeing to.

Home Appraisal

Step 3: The bank is typically going to extend a mortgage on the property, and they need assurances that it is worth what the buyer is paying for it.  That's the appraisers job, and they will come out and inspect your home, measure it, and look at local data to determine if the purchase price is appropriate.  If it's not, look out!  Your deal could be in jeopardy, especially if you've agreed to a "appraisal at purchase price" contingency.  So it's best to get that appraisal done quickly, without much ado.  Fortunately, problems at this point in the transaction are rare, but you still want to make sure the home is clean when the appraiser comes through.  It can't hurt!

Home Purchase Financing/Mortgage

Step 4:  The buyer, now with P & S, and appraisal in hand, has everything they need from you to get final approval from the bank.  Never an easy task, and it can take some time.  The date they need to do this is clearly spelled out at offer time and P & S time, but extensions are common, so don't be surprised if you get one.  Sellers are really between a rock and a hard place, as by typically NOT granting the extension, once asked for correctly, means the deal is off, so most sellers have little choice but to grant the extension.

Fundamentally, buyers extend if they still aren't sure the bank is OK to proceed with their loan.  And despite words like "Final approval" and "Commitment Letter" better words would be "Final Conditions for Approval" or "Qualified Commitment Letter".  Banks can (and do) pull financing at the last minute, and the best way to make sure that won't happen to you is to keep track of the extensions. The bank (and the buyer) have no obligation (and will not) keep you informed of the details, you will have to watch and listen careful to your agent and attorney, depending on who is doing the follow up.

Step 5: Close Preparation:

 Here is where you make sure the movers are lined up, you have a place to go, and the utilities will be cut-over appropriately. Don't forget about your Smoke Detector Requirements! It's also a good time to gather things you think the buyers may want that really belong with the home, like that user manual for the pellet stove, or instructions for how to work the irrigation system. Many sellers do not attend their closing, usually the deed is signed up front, and a LPOA (limited Power of Attorney) is granted so that your attorney can sell your home (while your dealing with the logistics at your end!).  It's a real time saver, so consider it!

 There's a lot at this step, but we've all moved before, so we probably know the drill.  Hopefully your agent has sent you a handy checklist to help you out, but if not, check out the USPS.  They have one!

Step 6: Close

Ah, the big day.  As noted in #5, you probably won't be there for the passing of paperwork, but your attorney will let you know when it's on record.  And now you just have to go where you're going and unpack!  How long can that take anyway?  Right?  Good luck, and hopefully you'll have many good memories in the new place.

*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.

If you're selling you home short, it's likely that you don't have any equity.  You might be thinking, well, if I'm going to walk away with nothing, I might as well sell it fast.  Well, yes and no.

Pricing Your Short Sale Right Is Important

You can't simply lower the price so low that it's well below market value. With a short-sale, the lender is forgiving debt, and each dollar you don't get for the home is a dollar that the bank has to write off. Believe me, the banks are not interested in giving short-sale folks an easy way out. The banks want assurance - typically several assurances - that they are getting close to market value for the property, and minimizing their losses. So you need to make sure that your home is priced right.

How Do I know My Short Sale is Priced Right?

A local Realtor in your area, with experience doing short sales and regular sales, is a good source for that information. Don't just ask any person with a real estate license! Short-Sales require experienced agents to make sure that they are setting the right expectations, getting the contracts right, are prepared for the longer sale cycle that has become the norm for short-sale. In addition, the appetite for different lenders to do short sales may also come in to play, and basically their experience will be a huge asset for you. Once you know you've got the right agent, they should be able to guide you to the right price point, and make sure that the bank won't decided that they can get much more than what you were able to get.

Take Care of Your Short Sale Property

Since we're trying to get the most for you home (remember, the MORE you get, the LESS the bank has to eat, and the more likely they will agree to the short sale), taking care of the property is key. Just as with a traditional sale, better condition will mean more buyers, and a better price for you home.

It is likely that in most cases, a well cared for home will be selling expensively relative to the local market, and since that's the case, that means you'll look good on all the BPO (Broker Price Opinions) that will done on the property. BPO's are done by the bank to make sure that the home has sold near the max that the bank can get for the property.

As another note, don't go out and get the most expensive lawyer you can find to do your short sale, figuring the bank will be paying your attorney costs. A) They may not and B) the more your attorney costs, the more expensive the deal gets for the bank - and that's bad! Make sure you know who and what your getting as part of the process, and what it's likely to cost.

Even if Your Short Sale Home is Top Notch, You May Not Get Top Dollar

Most buyers are aware at this point that purchasing a short sale involves waiting. Lots and Lots of waiting in most cases. The banks are slow in evaluating their options, and want to make sure that a short sale is their best (and usually their only option) outside of foreclosure. Since there's waiting involved, you may have to pay the buyers to wait around - and that usually results in lower than market price. For the most part, in my experience, the banks

understand this concept. Short Sales don't drive the price down very much - 2-5% in my opinion - but they are usually a discount to the overall market. Is it worth it? Well, that's another question...

Remember, there are other Factors Besides Home Pricing

With any short sale, a number of factors need to line up for the bank:

A) The short sale needs to be a better financial outcome for the bank than foreclosure.

B) The Property needs to be sold at or near market value

C) The Seller of the property needs to have Financial Hardship (See my Hardship Letter Section)

D) The bank needs motivation to cut their losses.

If you don't have all the elements lined up, the lender may decide that they won't work with you. If they think the price for the house is too low, they may ask the buyer to pay more - and that can have disastrous results for the deal you have in place.

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Do Good Things Today!

 Matt Heisler

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