My New Blog

So many For Sale signs everywhere you look… so many newspaper/magazine advertisements that rarely produce buyers… so many listings that have been listed for over a year… so many brokers hungry for listings with no real intention to spend any significant time finding a qualified buyer.

There was a time when 35% of all real estate sales were the result of buyers riding around and seeing a For Sale sign on a property that seemed to be of interest to them. Today, the For Sale sign accounts for less than 10% of buyer motivation. Why? Most buyers don’t shop anymore by driving around or scanning advertisements. They shop on-line via those agency website that appeal to them and that offer useful information. www.Realtors.com is the largest resource of information and buyers become easily-addicted to previewing properties in the comfort of their home. They often contact the broker of their choice and partner to identify desirable locations, features and prices that fit their budgets. A good broker realizes that most of these prospective buyers will not be ready to actually purchase a property for six months or more. They are shopping to become better acquainted with what’s available and what prices are being asked for properties of interest to them.

Professional brokers use this time to develop a trusting relationship with these eventual buyers. Too many brokers are motivated by the quest of a quick commission rather than developing a relationship with buyers that will endure long after the closing because a friendship often evolves. The lead time can be used to answer questions, identify concerns, and obtain mortgage pre-approvals. It's also a time to have the broker visit properties of threshold interest for an on-site preview to take some pictures to send along to a shopping buyer by the regular exchange of e-mails.

Listings often languish on-the-market for long periods of time not so much because the property isn’t deserving of serious buyer interest, but all too often because the broker representing the seller hasn’t a clue as to what it really takes to make a mutually-satisfying sale happen. The mechanics of selling properties doesn’t require any special skills; it requires persistent and creative attention to staging the property (a la HGTV programs), emphasizing the best features, and overcoming the negative aspects of the property. Selling properties is more about matching properties to people’s preferences… not a churning process of employing smoke and mirrors tactics.

Residential:

• High-end waterfront properties ($1-4 million) don’t seem to be influenced by the recession since “owning a piece of deep-water Maine dirt with a quality home that affords unobstructed ocean views” will always be in demand for premium undiscounted prices. Buyers of these properties usually purchase with cash and they know that the property values will appreciate nicely. The best opportunities are often not formally “on the market.” I find that being a native Mainer and well-connected to those who have these showcase properties has allowed me to occasion some great opportunities for buyers who enter into buyer-broker agreement with me. The days of finding salt water farms with 20 acres of land on the ocean for $60,000 are gone forever. This is true no matter how far DownEast you go!

• Low-end properties ($100,000 to $200,000) are plentifully available at heavily-discounted prices varying from 20 -30% reductions in the asking price. Even lower contract prices are sometimes negotiated by buyer brokers if the seller is highly motivated. It’s now a “buyer’s market” and there are many attractive opportunities to gets good deals. That’s why most of my business results from representing prequalified buyers. About 30% of the buyers that I work with are looking to temporarily bank these properties until the market re-stabilizes itself and they will probably flip them for an attractive profit. The tax credit incentive of $8,000 for first-time home buyers doesn’t seem to prompt purchases since low-end buyers often have only skinny incomes to apply the tax credit to. Energy conservation tax credits are more popular especially for the old sea captain mansions in prime historical locations that are deserving of restoration. Those buyers that are on a fixed retirement/social security income and just want to be anywhere in Maine because of the quality of life, can still find good deals if they work with an experienced and knowledgeable local buyer broker.

• Mid-range properties can be grouped into two categories: Those from $200,000 to $400,000 and those ranging from $400,000 to $1 million. The former properties are available in a wide variety of settings with very attractive price reductions being possible but one needs to carefully inspect the condition of the structure using an experienced home inspector (Cost run about $350). The latter properties in the next higher price range are a very diverse group of opportunities, Some have water frontage or water views and motivated sellers are offering attractive values for the price, but the buyer needs to be shepherded by a Realtor with local knowledge and seasoned negotiating skills. If it’s on a spectacular piece of waterfront land but the dwelling is only a ranch home in good condition (such as one listing I now have in Edgecomb), I’m finding that oftentimes the buyers are several friendly families that purchase the property together an use it mostly during the non-winter months as a shared hub location to enjoy the many attractive vacation opportunities in Maine.

Land:

• High-end land (on the water or with a to-die-for vista view) …and having over 2 acres in size with available soils for a septic system, are now going for $200,000 to $500,000 depending on the quality and location of the property. It’s not often that these properties will be discounted, but they are, in my opinion, a good investment that should nicely appreciate in value. As Will Rogers said, they aren’t making anymore land.”

• Rural land which is suitable for building a summer cottage or year round modest home (on at least 2 acres) is available and usually at good-value prices (say $80,000 to $150,000). Many are being purchased by buyers looking for a second home “in Maine.”

Other Observations:

• Most of the foreclosure or bank short sales aren’t, in my opinion, worth seriously considering. I’ve had better luck with my insider seller information and coaching my buyer to make a take-it or leave-it cash offer without any conditions and a closing in 30 days. Cash is still king!

• Generally speaking, there is a pathology for “the mind of Mainers. They are genuinely friendly and welcoming if newcomers buyers treat them respect and a cordiality that does not try to promote “change.” Many Mainers are, in their opinion, 20 years behind the times… in the right direction. Your broker needs to know this mindset and be able to guide you to a satisfying real estate solution for you.

I’d like to think that this blog information is useful, especially to buyers who might want me to represent them in the MidCoast Maine marketplace as their buyer broker. Call me on my cell phone (207-228-3248) anytime if you’d like to know more about how I might be a useful resource to you in your search for a Maine home.