When selling a home, most sellers offer the new buyer 12 month home warranty coverage which can be renewed by the buyer at the end of the initial 12 month period.

While very helpful, home warranties have often been a great source of frustration for homeowners.

A growing sentiment among frustrated and dissatisfied homeowners is that the home warranty companies are reluctant to approve item replacements that may be costly, even if it appears that it may be necessary. The complaints have been that the warranty companies only want to do whatever will require the least outlay of funds and they have “trained” the contractors they have contracted with to work to that end. Sometimes, that may have resulted in repairs over repairs on an item that should have been replaced.

I personally have not had those problems with the home warranty company I have had on my house for the past 7 years but I do hear from a great number of my clients who have this very complaint.

Enter America’s Preferred Home Warranty. This company apparently has been around for some time but it just became part of the Fayetteville, NC real estate scene very recently. It is a Keller Williams Realty approved vendor and actually works very well with our company though it is used by any and all other franchises and companies .

What makes America’s Preferred Home Warranty different is that the homeowner has the freedom to choose their own contractors. Yes, that’s right! Freedom of choice!  When the homeowner has an issue, they call the company and tell them who they want to call to make the repair. The home warranty company contacts the contractor and approves the repair. The contractor makes the visit, makes the determination as to what needs to happen to solve the problem (they are not working for the warranty company so they are free to diagnose the problem and recommend the true solution) and they get paid right over the phone if they can take credit card payments.

My clients are loving this idea!! All my clients have chosen this warranty since it was introduced to our market center in Fayetteville, NC.

The coverage is the same, if not better, in certain areas than the other warranties my clients have had and for $410 you still get the $55 service fee. Others I have used in the past charge a higher base price if you choose the lower service fee.

Of course, the true test of a home warranty plan is its responsiveness to client concerns and satisfaction. We’ve not been using America’s Preferred Home Warranty long enough to know for certain how it consistently handles claims but if they keep their word and provide the service they promise, they may come to won a great share of the home warranty market.

Posted via email from JuliGrace

Posted via email from JuliGrace

The Crisis of Credit Visualized – The Big Picture

I was browsing my Twitter account one day, and found this link to a video from one of my followers.  It is exceptionally well done and helps to explain what happened to our credit markets, and how it is related to you and your home.  Please check it out:

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo

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Certainly, there is more complexity involved than this video can portray, but it goes a long way towards explaining why we are where we are.  The uncertainty of the future, consumers burdened with excessive debt, and unsteady property values compound the effects, such that we should not wonder that banks are complaining that nobody wants to borrow money.  Unfortunately, in our country, in our time, we have built an economy based on buying with credit and living with debt.  Nationally, we have a very large problem.

So, What Does This Mean To Me and Buying or Selling a Home?

There’s good news, especially if you are looking to buy or sell a home in Fayetteville. The local economy is still relatively strong, and home values have increased in general.  In fact, according to Zillow, Fayetteville leads the nation in home price stability, showing an increase in overall home values of almost 7%, better than any of the other 160 markets that Zillow tracks.  Additionally, we expect growth of 20,000 more families between now and 2011 under the Defense Base Closure and Re-Alignment Commission (BRAC).  Lenders have money to lend, and VA and FHA loan programs are widely used and available.  The real estate market remains balanced for homes in many price ranges, and there are some great homes available at reasonable prices.  All of this bodes well for both buyers and sellers in the local area.

If you are considering selling your home or buying a new one here in Fayetteville, please be call me or email.  I would love to provide more information on specific houses or neighborhoods or help you find a reputable lender to get the process started.

In my page about Fayetteville Real Estate Market Information, I explain that absorption rates are a way of showing how quickly homes are selling.  This chart shows, based on sales over the last 12 months, how many months inventory there are for homes in each price range.  Take a look at the following table:

Absorption Rates November 2008 - Existing Home Sales

Here’s the bad news (if you are a real estate agent or a home seller.)  Right now, in every price range over $150,001 there is more than a 6 month supply of houses on the market, and for price ranges over $225,001 there is over a year supply.  For price ranges below $150,000 there is a 5 month supply on the market.  By most expert opinion, this data suggests we are in a buyers market and it certainly shows that the market in Fayetteville is much more sluggish than usual.

But, statistics can be misleading, and here are a few facts to consider:

• absorption rates are a lagging indicator of market activity–they look back over the last 12 month period, not forward;
• houses do not sell in the order they come on the market.  The fairly priced house, that is well maintained and in a good location will sell more quickly than other houses, and it will have more buyers interested in it;
• 67% of the houses for sale in Fayetteville are priced under $175,000 and those price ranges sell more quickly, even if there are more houses available.

Additionally, if we compare the number of houses on the market to the last report, there are more homes for sale in the lower price ranges than last time, and fewer homes for sale in price ranges above $175,001.  This indicates that some sellers may be waiting for conditions to improve before they list their house for sale.

Okay, so what does this mean to you?

• If you are considering selling your home, or if you already have your home on the market, you will have to make sure your home is priced right and in good condition if you want to sell it quickly.  Good marketing, including proper maintenance and staging of your property will make a difference.
• If you are a buyer in the market for a home right now, you will have a good selection of homes available, and sellers may be willing to deal more than they normally would.  In the Fayetteville market, it is not at all unusual for sellers to contribute to a buyer’s closing expenses, and if you are planning to use a VA loan to purchase your home you may be able to buy a home with very little out-of-pocket expense.
• If you are an investor, there are good properties available.  Anecdotally, the rental market in Fayetteville has improved appreciably.  Houses seem to be renting faster–it may be that more people are choosing to rent over buy while they wait for economic conditions to improve.

Selling or buying a home right now requires a little patience and an experienced broker if you are hoping to make the best of market conditions.  Please email me or call me if you want some advice or are unsure of the best way to proceed.   You can still meet your objectives for buying or selling even in the current market.

Rebecca Russell
Haymount