Lancaster County PA Realty Check: September 2007

Sellers - Don't Let Your Buyer Move In Before Settlement

Every so often, when a vacant house is for sale, a buyer will have a situation where they need to leave their current home before their settlement on the new house.  They may be renters whose current home is being sold to someone else and they are being forced to leave.  Sometimes the house they are purchasing needs work, and the buyers want to take possession and do the needed repairs themselves before settlement.

It may seem easy for the seller to have their agent write up a pre-settlement occupancy agreement, and receive a little rent before the settlement.  Please trust me on this:  DON'T DO IT! 

What will happen virtually every time is that the new buyer, after moving in, will discover little things (or not-so-little things) that they hadn't noticed originally, and want the seller to either fix them or make an adjustment off the price of the home.

Buyers have ample opportunities to thoroughly inspect houses before they purchase.  Buyers have the right to ask for a professional home inspection, and I highly encourage them to do so.  The purchase can be made contingent upon a home inspection report satisfactory to the buyers.

However, if the buyer is allowed to move in before settlement, the seller is asking for trouble.  Let me give you an example:  I once had a chain of four homes waiting to settle.  I had a buyer for a townhouse.  The seller of that townhouse was buying a small detached house.  The seller of the small detached house was buying a larger detached house.  I was representing the seller of the larger detached house, and they were also going to buy a luxury home.

You can see that I was highly invested in making this whole series of transactions work!  My seller of the larger home wanted to move into the luxury home, which was vacant, a month before settlement so they could redecorate.   A pre-settlement occupancy agreement was negotiated, and they moved in.  Even though they had had a professional home inspection beforehand, once they move in and started redecorating, they found a number of issues that they were not pleased with.

Some of their complaints were reasonable, and some weren't reasonable.  They threatened not to go through with the purchase if they did not get a large reduction in the price.  Of course, if this sale didn't go through, all of the other sales that were dependent on it would fall through as well.  Even though some of the demands were unreasonable, the seller of the luxury home was forced to make expensive concessions.

Let me emphasize that buyers need to take every opportunity to be sure that they are familiar with the condition of the house that they are planning to purchase.  But once the inspections are made and the buyer is satisfied with the results, possession should not take place until the financing is "clear to close" and the settlement takes place.

Some days you're the windshield; other days you're the bug...  I was reminded of this old saying recently as I read all the hand-wringing stories of how bad the housing market has become.

If you don't have a long term perspective, I'm sure it looks like the worst of times.  Sub-prime mortgages drying up, housing prices going down, builders pulling in their horns on new construction, too many listings on the market.

Do you feel like the windshield or the bug?  Are you a "doer" or a victim?  Are you reacting to the situation actively or passively?

I've been in business forty years (wait a minute - that can't be right - maybe there was an error on the calendar!?!  LOL)  I've seen booms and I've seen busts worse than what's going on now.  Quite frankly, the booms were not as great for me as "advertised", and the busts didn't put me out of business - though they surely did their best to try!

My point is - whether you think you can succeed or think you can't succeed, you're right.

Buyers - Take advantage of the soft prices and pick up some great home values!

Sellers - Price your homes realistically, sell quickly, and take advantage of savings on your new home purchase!

Agents - Stay in contact with your sphere of influence - they're your greatest resource.  It takes five times as much money to find a new client as it does to keep an old one.  Past clients are also a source of referrals if you've done a good job, so treat them well - they're like gold!

Copyright2007BrianSchulman©

Chickies Rock County Park, Columbia PA

Located on Chickies Hill between Marietta and Columbia, PA, Chickies Rock County Park offers some of the most spectacular views of the Susquehanna River available anywhere in the Susquehanna Valley.

Located off Route 441, the park starts with a parking area. 

Walking trails meander west toward the river...

Although the river can be seen from Columbia, it's farther away from Route 441 than it appears.  The hike to the overlooks is a little over a mile, uphill but not too difficult.  After you break through the woods, the trail opens wider.

When you get near the river, the terrain suddenly shifts steeply downhill.  Although there are barriers on the Chickies Rock ledge, caution is advised.  Local stories are told about suicides over the ledge, and accidental deaths of people who took unnecessary risks after drinking too much!

Chickies Rock was named after the Indian word "Chiquesalunga", meaning "place of the crayfish".  The county park consists of 442 acres. 

Caring Singles held its annual Autumn picnic Sunday at the Manheim Township Community Park in Neffsville.

For some reason, this picnic is always blessed with great weather, and this year was no exception!  The temperature reached 80 degrees, but a cool breeze kept things totally comfortable.

Red Rose Singles is a non-religious, non-profit, non-discriminatory organization.  Its purpose is to provide support for single, separated, divorced or widowed persons.  In addition, Red Rose Singles hosts get-togethers such as dine-outs and hikes.

Red Rose Singles meets the first Tuesday of each month at the Farm & Home Center, 1383 Arcadia Rd, Lancaster, PA.  Registration starts at 7:00 PM, and the meeting starts at 7:30 PM.  There is no charge for first-time guests.  The meetings alternate between group discussions, and speakers or entertainment.  Refreshments are served afterward.

Copyright2007BrianSchulman©

Meyer Rothschild, 1744-1812, the founder of the Rothschild banking dynasty, was famously quoted for saying, "Buy when there is blood flowing in the streets!"  He meant, buy when no one thinks there will ever be a market for real estate again.

Many buyers is today's soft housing market seem to have bought into this frame of mind.  I keep hearing from buyers, "I'm looking for a real estate investment, but only if I can STEAL it!"

Not all or even most sellers are desperate to sell at this moment.  Even if they were, they have high mortgages to cover in many cases.  There are more listings on the market than normal, but there is no glut on the market in most locations.  For these reasons, most real estate prices have been softening, but by no means collapsing.

Greedy low ball buyers risk never finding a deal that they can recognize as a good value.  They can waste many hours of their real estate agents' time.  They can offend sellers to the point that no one wants to deal with them.  But they're unlikely to end up owning a good investment unless they become more realistic.

Right now is a great time for buyers to find great deals in real estate.  Unusually good values are available.  But (thank goodness) there is no blood in the streets!                                            

Copyright2007BrianSchulman©

Both the stock market and mortgage rates reacted positively to the Federal Reserve's rate cut announcement today.  A federal funds rate reduction of 1/2% was announced after the Federal Reserve Open Markets Committee meeting.  Many pundits had speculated that a rate cut of only 1/4% was more likely, since the Fed is primarily interested in preventing the resurgence of inflation.

However, the softness of the economy in general, and of the housing market in particular, has apparently reduced the Fed's fear of inflation, and increased the probability of a recession if rates were not reduced more than a minimal amount.  Recent polls show that home builders are bearish in all four regions of the United States.

The rate reduction is good news for the millions of homeowners with adjustable rates set to adjust in the next year or two years.  Since subprime mortgages are almost non-existent now, these borrowers would be in trouble except for the fact that the FHA mortgage, with some significant new improvements, is back in style again!

While subprime mortgages priced risk through increased interest rates, FHA prices risk through MIP, its mortgage insurance.  This is a prime reason why FHA still has reasonable interest rates!   Also,  FHA has recently become much more liberal in its appraisal requirements and down payments.  It was already quite liberal in credit requirements (no minimum FICO) and gift policies.

It will now be easier for many homeowners to refi out of their adjustable rates.  This should reduce the number of foreclosures, which in turn will reduce the number of properties on the market.

Fewer homes on the market will reduce the softness in housing prices, and start us back on the road to a more normal housing market.

Copyright2007BrianSchulman©

Lancaster PA Latino Parade

The 27th annual Puerto Rican Day Parade was held in Lancaster September fifteenth on a beautiful, cool, sunny Saturday!

The parade started on South Duke Street, turned on Orange Street, then went up Queen Street to end at Binn's Park.

Music filled the air, and a the sidewalks were crowded with celebrants watching the dancers, marchers, and musicians.  It would have been hard not to get caught up in the Latin beat!

The parade theme this year was "Latino Youth: Nuestro Futuro Positivo" (Our Positive Future).

Lancaster PA Civil War Encampment

September fifteenth turned out to a beautiful pre-autumn day for the recreation of a Civil War Encampment on the grounds of the Lancaster County Historical Society, at the corner of North President and Marietta Avenue.

The pungent smell of campfires burning permeated  the cool morning air.

The "Mayor" was in attendance in full top hat and tails!

A military drill practice included a musket firing demonstration.

The Lancaster Civil War Round Table was in attendance.  They meet on the second Thursday of every month at 7:00 pm (except December) at the Lititz Public Library, 651 Kissel Hill Rd. in Lititz. Meetings are free and open to the public.  Donations to defray the cost of speakers (authors, historians, battlefield guides) are appreciated, but not required.

A lively fife rendition of "The Battle Hymn of the Republic" reverberated through the field!

This young lady insisted that I wait until she put away her camera so that my shot wouldn't be historically inconsistent.  (Unfortunately a car on Marietta Avenue sneaked into the photo anyway!)

The beautiful stone barn at the historic Rock Ford Plantation will be the setting for an antiques show Saturday, September 15 from 9 am to 4 pm.

Rock Ford Plantation is the estate of Edward Hand, a Revolutionary War  General.  The plantation was saved from destruction in 1957 by the Junior League of Lancaster.

Antique dealers will have furniture and antiques for sale in the barn.  The public is also invited to bring their own antiques for  an "Antiques Road Show" type evaluation.  If an heirloon is too large or heavy to bring, photographs may be brought instead - but if bringing photos, they must be of sufficient angles and detail that the experts in attendance can evaluate the condition and any marks on the piece.

Rock Ford Plantation, 881 Rock Ford Road, is south of Lancaster and can be reached off Chesapeake Street.  The antique show is part of the celebration of the fiftieth year of Rock Ford's being saved from demolition.

Copyright2007BrianSchulman©

For the 19th year, the Lancaster County Historical Society, 230 North President Avenue, will conduct a Civil War encampment on its grounds at the corner of North President and Marietta Avenues.

Some fifty volunteers in period uniforms and costumes will portray Union soldiers and civilians.  the reenactment will be open to the public 10 am to 5 pm Saturday, September 15, and 10 am to 4 pm on Sunday, September 16.  Refreshments will be available.  There will also be a candlelight tour at 7 pm Saturday.

Musket firing demonstrations, military drills, and even a surgeon with an authentic civil war era amputation kit will be on hand to interact with the public.  Classes are also available on Civil War topics.  For information on registering for the classes, or for more information on the encampment, the public can call  (717) 392-4633, or log onto www.LancastorHistory.org.