Lancaster County PA Realty Check: April 2008

 
Last Friday I had the privilege of taking a tour through the marvelous new wing of the Manheim Township, PA High School!  Realtors from Lancaster County were invited to a continental breakfast to view the new wing and get an update on the latest improvements.

The wing greatly expands and remodels the original school building build in the 1950s. 

To start off, the entire project has been planned with green technology in mind.  A state of the art geothermal heating system taps the heat from under-water wells that maintain a temperature of 65 degrees Farenheit throughout the year.

300 wells were dug to a depth of 450 feet each.  60 pipes each connect to 5 wells.  The pipes connect to a grid under three athletic fields.  Only a small amount of supplemental energy is needed to maintain comfortable temperatures in the building.

Low-emissivity glass windows retain heat in the winter.  A light-sensitive lighting system constantly adjusts to the amount of natural light coming in from the outside, to save energy.

A new performing arts theater with a 60-foot ceiling is still under construction in part of the original 1950s section of the complex.

A fantastic new gymnasium with amazing flexibility is almost entirely completed.  2,000 people will be able to be seated around it for special events.  Up to ten basketball teams will be able to practice at the same time, with separate nets and backstops which can be lowered from the ceiling.  An oval track is planned for the upper perimeter.

The new state of the art library is a sight to behold.  Ten specialized databases are available for searches on the computer system.  Study areas are interspersed throughout the wide, spacious library area.  Although the modern, attractive bookshelves are still largely unfilled, 23,000 books have already been put in place on the shelves.

The new cafeteria seats 650 students at a time.  Vast glass expanses overlook the high school grounds. Separate food stands in the serving area provide new healthy choices, such as a salad bar and gourmet foods, as well as more traditional fare.

The school district is currently trying to raise private money to renovate the pool, which while already impressive, is over fifty years old.  The base of the pool has been deteriorating, and the old pumping system has already had to be renovated.

The new additions have been designed in such a way as to be able to easily accommodate future expansions of the student population.

I came away with a great respect for the highly intelligent and imaginative planning that has gone into the latest improvements for the students of the Manheim Township School District.

Did you know that the NAR (National Association of Realtors) is the largest trade association in the US?  With 1.3 million members, the NAR is a major proponent for home ownership and property rights.

NAR's national publicity campaigns have promoted a more professional image of Realtors(R) helping buyers find just the right house, and helping sellers market their homes in the most effective way.

I was not big fan of the previous campaigns that stated "You have a life.  Real estate is our life."  Nonetheless, it did make the point that Realtors are prepared to work hard and ethically for the public.

Everyone knows that a Realtor will show homes to buyers.  Everyone knows that Realtors have sophisticated marketing tools for selling homes.  Here's my question: Why hasn't the concept of Buyer Representation received more public emphasis from the NAR?

Many buyers start their research on the internet to look for a home.  Almost invariably they start out by looking at the homes that are listed in what they calculate should be their price range.  After narrowing the field down to a controllable number, buyers often assume that they will do better by contacting the listing agents for each listing, and having each agent describe the features of their particular listing, and show the home if it sounds good to the buyer.

The buying public is woefully unaware of the fact that they are unrepresented as they go through this process.  They often feel as though an agent is an adversary to be tolerated since the agent is the one with the keys to the homes!

Nothing could be further from the truth!   But NAR, with its public megaphone, has largely ignored the aspect of promoting Buyer Representation.  Everyone know that sellers will have an agent tasked with the responsibility of representing the homesellers' best interests.  But what about buyers?  Do they know the difference between being a customer and a client?

Unfortunately, many buyers don't know what they don't know, and the National Association is in an ideal position to educate the public.  There is little emphasis on the importance of choosing a competent Realtor to represent buyers before the choice of a property is made.

An agent representing the buyer can offer objective advice about each home, including possible reasons NOT to buy a particular house. 

A Realtor representing a buyer can be an experienced negotiator, keeping the buyer's negotiating position confidential.

A Realtor representing a buyer can provide due diligence in suggesting specialized inspections that may be indicated, or provide advice on the advantages or dangers of various financing options.

A buyer can have representation in most cases for FREE.  Why wouldn't every buyer want to take advantage of a service that could give them so much protection and value - and even save them a great deal of money - for NO COST TO THEM?

As an Accredited Buyer Representative in Lancaster County, PA, I am very much aware of the need for more public education on the subject of representation.  If you have any questions about buyer representation, I would be happy to answer your concerns via email, or call (717) 951-5552.

Copyright2008BrianSchulman©

Are you looking for a suburban townhome at a really reasonable price?  This town house has had a BIG price reduction, and is now available for only $114,900!

It's located in a great subdivision, close to Route 30, near shopping centers - yet off the busy streets, and with a lovely park nearby.

Central air conditioning, off-street parking, a corner fireplace and a modern kitchen are some of the features of this economical home.

This home is now available for immediate occupancy.

For your own private showing, call Brian Schulman at (717) 951-5552.

Copyright2008BrianSchulman©

There has been a great deal of negative publicity about the subprime mortgage industry.  High interest rates and the adjustable rates that are now resetting have been a major cause of foreclosures and the unrest in the housing market.

Don't misunderstand me.  There's plenty of blame to go around.  Many borderline borrowers went way beyond common sense in the houses and mortgages they committed themselves to.  Many real estate agents did not adequately prepare their buyers for the worst cases possible in their mortgage terms.  And many loan originators were only too happy to have more transactions provided by the extremely liberal past credit requirements, even if the resulting loans would be riskier.

Having said that, there is now a concerted effort in the media to find blame and point fingers.  There is certainly a place for reasoned analysis of what happened.  As it is said, those who are ignorant of history are doomed to repeat it.  But there is also a risk in going overboard.  The sensationalism is pushing lenders and buyers way too far in the opposite direction.

Markets are driven by alternating cycles of greed and fear.  Right now we're in a fear cycle.  Lenders have overreacted by making some qualification standards too strict.  Many buyers, too, are fearful of making any commitment in such an atmosphere.  It may take a while, but the pendulum always swings back around again.

There was (and still is) a need for what used to be called subprime lenders.  We can't use that term anymore because of the stigma attached to it.  There were indeed dishonest opportunists in the industry who overcharged borrowers and sneaked insidious terms into their contracts.  But that doesn't mean that the need for risk-priced mortgages has disappeared.

There always will be a continuing need for higher risk loans to higher risk borrowers at a commensurately higher rate  of interest or fees.  The renewed popularity of FHA shows that this market isn't going away.

And for buyers with good credit, the traditional mortgages are still available, with the best interest rates in years. 

If you would like a no-obligation consultation on the real estate market or mortgage situation in Lancaster County, PA, please feel free to call me at (717) 951-5552.

Copyright2008BrianSchulman©

Every month new statistics are published regarding the state of the housing industry.  Recently these statistics seem quite depressing!  While not discounting the fact that the real estate market has been soft in most areas of the country, several factors combine to make these statistics somewhat sensational and rather misleading.

In the first place, all real estate is local.  Just like the old joke about location, location, location.  National statistics don't tell the story of what conditions are like in your area.

Furthermore, even if you separate the local statistics into average sold price or median sales price, it still doesn't tell the whole story.  Average sales price is arrived at by taking the total sold prices and dividing that figure by the number of homes sold.  But  even this figure doesn't tell you what you need to know. 

What are your particular neighborhood figures?

Are higher priced homes selling well?

Are medium priced homes taking longer to sell?

Is there a slow-down among lower-priced city homes? 

In other words, you see that figures need to be broken down into neighborhoods, types, and price ranges in order to be meaningful.  How long the homes took to sell is also a factor that usually isn't mentioned in the media.

What about median home prices?  The median sales price simply means that half the number of homes sold at above the median price, and half the homes sold below it.  But is that as meaningful as it would seem?  Not so much as one would think.  The problem with both the average price and the median price is this:  we're comparing apples and oranges.

If it were the same houses that we were comparing from month to month, the comparison would be meaningful.  But we're not comparing the same houses.  We're comparing a whole different set of houses that went to settlement each month.  Were they nicer than the houses that sold the previous month?  Were they on equally nice lots?  Were the sold homes predominantly  in different price ranges?  The overall trends can be meaningful in a general sense, but month-to-month comparisons aren't particularly useful.

The thing to keep in mind out of all this is that in order for real estate statistics to be meaningful, they must be as specific as possible to a particular neighborhood and price range.  An experienced Realtor can help you analyze the data.  

If you have any questions on real estate home sales in Lancaster County, PA, please feel free to call me at (717) 951-5552.

 Copyright2008BrianSchulman©

Let's say that you bought an inexpensive investment property for cash.  Let's say that the property needed some work, and you fixed it up so that it is now ready to be rented.  Now you'd like to get some of your money out of the property, so that you can either pay back your line of credit, or start in on another project.

How do you get your improved equity out of the property so you can move on to your next goal?  Refinancing this type of property is different than financing owner-occupied houses.

In the first year since you purchased the propertry, most lenders will only lend on a percentage of what you actually paid to buy it.  An exception to this may be if you can produce documented evidence of significant improvements that you have made since the purchase.  If you can show receipts for the improvements, some lenders may be willing to lend based on the current appraised value of the improved home.

Another consideration will be the relatively small mortgage that such a property will justify.  A number of lenders won't lend less than $40,000 or $50,000 as a matter of policy.  If your project justifies a smaller loan than that, many lenders won't consider it.

You might also check with your own bank, with whom you already have a relationship.  Banks will probably be better in this case than mortgage brokers, who would have to package and resell their loans on the secondary market, and therefore must adhere to FNMA or FHLMC requirements.

If you would like more information on how a qualified REALTOR with Lancaster County property management experience can help investors save money and reduce their risk, please call (717) 951-5552 or email brian@FindLancasterHomes.com .

©BrianSchulman2008

As I drove through Millersville, PA this morning, traffic was blocked on North George Street, the main thoroughfare past the University.  There were several Millersville University police cars, a policewoman directing traffic, and what looked like a TV news crew truck.

At first I thought it must have been another vising politician.  With the Pennsylvania presidential primary scheduled for April 22, Hillary had been here last week with a large police entourage, and Senator Obama was in Lancaster earlier this week.

It turned out that the University was under lockdown for 90 minutes.  A student had reported to police that he was afraid of another student.  He apparently believed that the other student had a gun and was a threat to the student body.  With recent shootings at other universities, such reports are taken very seriously.  A student was detained and taken in for questioning.

Penn Manor High School and Eshleman Elementary Schools, both nearby and in the Penn Manor School District, were also locked down.

Students were told to remain calm, to stay inside their buildings, and that they were not in danger.

Copyright2008BrianSchulman©