Home After Home: Louisiana: Baton Rouge

When you are buying real estate or selling real estate in Baton Rouge or anywhere for that matter, the negotiations are one of the most critical components.  Ask yourself a few questions before entering into any negotiation.

1. When do I want or need to close the sale?
2. What is the most I will pay for this home? or What is the least I will sell this home?
3. What incentives can I give to the other party so that they will want to work with me?
4. What else is a make-it or break-it factor for me?

Number 1 is important because it can control your move in and move out dates.  If you have a lease you may want to close near the end of your lease, but not AFTER the expiration of the lease. If you have a home to sell and a home to buy you may need to coordinate these dates so that they "sync".

2. Price.  They say that's all that matters, but it's not ALL that matters. Price is important but I doubt a few thousand dollars within your target number would keep you from moving forward... or at least it shouldn't. Know what you want your bottom line to be, but be flexible enough that if you get close to it, you can still make progress.  Here's another tip that may help. Don't make a counteroffer over a couple of thousand dollars either. Yes I know that $2,000 is a lot of money.  But is it enough money to keep you from realizing your goals and making the move you're wanting or needing to make? It shouldn't.  That's not enough money to keep you stagnant so don't let it stall you in a negotiation. Your real estate agent should be compentent enough to provide you with cost estimates so that you know how much money you need to bring to the closing or how much money you'll walk away with from the closing.  These numbers are "estimates" but they should be close enough for you to make an informed decision. Ask your realtor for a "seller's net sheet" or a closing cost workup if you are a buyer.

Incentives! Don't forget the gravy.  Gravy is what makes the deal more palatable to the other side.  If you are a seller leaving the washer, dryer, and refrigerator might be the gravy to the buyer. If you are a buyer, coordinating a closing date that works for the seller may be the gravy for them.  Buyer's: It's also helpful to know that if you are preapproved or have proof that you have cash to buyer and don't have to sell a home then you are more attractive to the seller than other buyers.  Figure out what little "extra" you can give the other side to help them out and you're negotiation will start and end much smoother!

Number 4: Make-it or Break-it.  You need to know what is a deal-breaker for you before you enter into the negotiations.  This will save you time, effort, and stress! For instance, if you are a buyer and you only have $5,000 to work with and you know that will cover your downpayment but not your closing costs, then you know that it's a deal breaker for you if the seller doesn't cover your closing costs.  If you are a seller and are moving for a job relocation, your deal-breaker may be if the buyer can't fit with your closing dates.  Know what your absolute deal-breakers are upfront.  When you start to think through this process, you'll realize that some items that you thought were deal-breakers may be more flexible.

That's only a few items that go into a good negotiation.  It's not like buying a car. If you don't like the deal at the car dealership you can leave and go to another dealership and find the exact same car. No. With houses it's different. You're buying a home. Or you're selling a house. In either case, you can't just turn tail and walk away.  There isn't always another exact replica of that house that you want to buy in that neighborhood (although, I guess in some neighborhoods there are) and if you are selling there isn't always another buyer standing in line to buy your home.  So work with what you have to get you what you want.  In the end, you'll be happy that you made a deal that works for everyone AND you got to move on with your life!

If you are considering a move to Baton Rouge, then you might want to read up on what's going on in and around town. Of course, you want to look at the real estate in Baton Rouge, but you also need to know that there's lots of action here and lots to do if you know where to find it.  Here are a few of my top picks.

Sports
With two universities in Baton Rouge, LSU and Southern, there's lots of sports action, year round.  This time of year, most of the action is in the new Alex Box Stadium at LSU and it's a home-run hitter for Baseball fans.  To keep up with LSU sports schedules (basketball, football, baseball, and more) go to www.LSUSports.net. That's where all the current information is along with the results of the latest games.  And to get current sports information for Southern go to www.subr.edu/athletics/.

Theater
If you want to take in a play or a musical you'll probably be looking for the Baton Rouge Little Theater company or Swine Palace Productions.  Both offer a great selection of plays.  For a nice evening out, try their websites to see "what's playing". www.BRLT.org or www.SwinePalace.org

Arts
If it's Art you're looking for there are several smaller galleries around town, but I'll mention only two here. There's the Baton Rouge Art Gallery and the Shaw Center for the Arts. Both have interesting schedules.  The Shaw Center for the Arts is a newer building in downtown Baton Rouge near the riverfront and it includes a theater which shows plays and a sushi restaurant on top floor.

Entertainment
If you're looking for a little entertainment you might want to check out Live After Five which is an outdoor, open-air music concert (party) on the streets of downtown Baton Rouge on Friday's 5p-8p. Before you go, be sure to view the current schedule so you can see who's playing!

Now, that's enough to get you started. Even if you are only in town for a few days to look at homes that are available, try to make time to enjoy yourself while you're here!

How does buying a "short sale" affect the buyer?  So many buyers are asking this question and it’s a good one.  Sometimes us REALTORS sound like we are speaking a foreign language.  We talk about ARM’s, Buy Downs, BPO’s, CMA’s, Negative Am, and so on.  It’s worth explaining rather than using our “industry dialect”
Lets first talk about “short sales” and how it affects buyers.  A short sale is simply a transfer of ownership with the seller’s lender agreeing to accept less then the total amount owed on the seller’s loan or loans.  All of the seller’s loans on the property must be paid or satisfied by the banks in order to convey a “clean” title to the buyer.   There are situations when the proceeds of the sale will not satisfy the seller’s payoff.  So the seller is “short”, thus a “short sale”.  For any buyer purchasing such a property it can be a blessing in disguise.

 
● GETTING GOOD VALUE - The buyer is likely to get these properties below appraised value.  Ultimately the bank has the final say on all the terms of the agreement. 

● BEING PREPARED - The sales process takes longer then traditional sales.   Since there is one more person involved, obtaining an accepted sales agreement takes longer.  In light of the fact that many lenders across the nation are flooded with Short Sales and Foreclosures, the one property that you are buying is of little priority to the bank.  It is only one drop in the bucket that is already full to the rim.   We sometimes wait weeks or even months to get a response from a bank on an offer on a property.

● ACCEPTED AGREEMENT - Once the bank agrees, the buyer then proceeds with the terms of the agreement just as they would with any other sale.   Inspections, appraisal, and all the usual details spelled out in the sales agreement.  Keep in mind, the property may or may not have utilities turned on.  Many times the buyer will turn on the utilities in order to do inspections.  In some cases, the buyer is so thrilled with the terms of the sale they may elect not to have utilities turned on for inspections.  This is on a case by case basis to the satisfaction of the buyer and in compliance with the terms of the agreement.   In most cases, the buyer will be purchasing the property in its “as is” condition.  Expect no repairs to be done by the seller or the bank.  This is one reason the buyer will get a good value.   The bank will have their process.  After receiving a complete package from the listing agent and the seller, it is highly likely the bank will order a Broker’s Price Opinion (BPO) or an Appraisal.  Then the bank will present to their investor for approval of the contract.  This all sounds easy, but is a time consuming process that can take weeks or even months.  When the REALTOR tells you the property has been assigned to a short sale negotiator, then the ball will begin rolling.  Until then, time is frozen, and no progress occurs.  Having successfully closed many short sales in Baton Rouge, La, I have learned to teach agents and buyers to expect enormous delays in the process. Remember “patience is a virtue”.

● CLOSING THE SALE - The bank must also approve the final sales documents before the closing takes place.  Primarily they are interested in approving the HUD which is a statement showing the details of all money involved in the transaction.  Since it’s a short sale, they definitely do not want to see any proceeds going to the seller.  Will the buyer be faced with any unusual title issues?  As long as a reputable closing agent does their job, the answer is no.  One of the jobs of the closing agent is to verify that the title conveyed is clean with no liens or encumbrances.  The buyer can also buy an owner’s title insurance policy from the closing agent.  So when you accept the keys to your home at the act of sale, you can feel good about your home.

● HOME OWNERSHIP - It’s been said that the misfortune of one can be the fortune of another.  This can be true to buyers who are buying such properties.  Just remember, your penance is weathering the time factor and remaining patient.   This is can prove to be money in the bank for you.   Happy house hunting!

I was out the other night at the poker tables when the player next to me found out that I am a REALTOR. She asked, "What's the average price per square foot for Baton Rouge?" What a question! I figured it would be good to answer that question in a blog post.

First, let me say that Baton Rouge hasn't been hit hard by the failing economy around the rest of the country. We have not had the bottom fall out of our real estate market. In fact, while we have felt the repercussions of weakened economy, the impact has been minimal.  Throughout 2009 we felt the impact of fewer sales. Coupled with fewer sales there has also been a slight drop in home prices.  As the lending practices have tightened, the sales have slacked up.  Here's a chart that shows the number of sales in Jan and the number of sales for the whole year for the Baton Rouge Real Estate Market over the past few years.

Here in 2010, we've had 204 transactions for January.   This number actually surprised me when I looked at it. What we are feeling is an increased demand in the movement of buyers and an increase in the number of sellers ready to list.

But that's just the "number" of transactions in Baton Rouge. Now, let's look at average sales price over the same period.

Those numbers show some movement and stabilization in the market.  You can see that our prices haven't just bottomed out like some other markets around the country.  Now, my prediction - not that I'm an expert in statistics - is that we'll see prices graduate upward a bit in 2010.

So, now that we've covered the background here are some rough numbers for a few neighborhoods around town. This is not intended to be a market analysis for your home. Your home should be compared to homes that have similar finishings, similar size, and similar age.  These are averages based on the past year of of all sales in each area.

For information on your home or a home you are looking to buy talk to your realtor about specific data that pertains to your subject property.

The important point in all of this is not just that real estate is local. It's more than local. I could provide you with an average price per square foot for Baton Rouge, but what would that tell you? I say it would tell you absolutely nothing about Baton Rouge. The ranges vary greatly from neighborhood to the next. All of the neighborhoods on the list above are very desireable areas with lots of activity, but still there is a great variance from one part of town to the other.

After having knee surgery, Butch Strother, developed clots.  The doctors then noticed a blockage near his heart.  Now he is scheduled for bypass surgery and could use the support and prayers of our community.  If you would like to show your support (and have a good meal) please come by and pick up a jambalaya lunch on Tuesday, August 11, 2009 at:

RE/MAX First

4750 Sherwood Common Blvd.

Baton Rouge, LA 70816

If you plan to have a lunch send an email so that they'll have a head count and can prepare the appropriate number of lunches.  Send your email by 8/10 to get your lunch request in timely!

Lunch pickups can be made 10:30a - 1:00p on 8/11.

Butch is a great guy so when you plan to go out to have lunch next Tues, just plan to come on over to RE/MAX First and pick up lunch instead.