Riskiest Real Estate Markets

Here's one Forbes list I'm glad Knoxille didn't make it onto: America's 10 Riskiest Real Estate Markets. The 10 unfortunate winners are:



1. Detroit, MI
2. Orlando, FL
3. Cleveland, OH
4. St. Louis, MO
5. Miami, FL
6. Las Vegas, NV
7. Sacramento, CA
8. Denver, CO
9. Tampa, FL
10. Phoenix, AZ

How risky are these markets? This quote from Forbes.com says it all:

There's roulette and there's skydiving. Then there's investing in Detroit and Cleveland real estate.

Ouch.

Repeat after me: there's no place like Knoxville!

Neighborhood of the Week: Holston Hills

So far, NOTW has showcased Sequoyah Hills and Lakemoor Hills. In keeping with the "Hills" theme (no connection to Heidi or Spencer, I promise), this week's neighborhood of the week is the east side "Hills" neighborhood, Holston Hills.

The Knox Heritage website has some nice info on the history of Holston Hills:

One of the best-kept secrets in Knoxville, Holston Hills is named for the river that borders the neighborhood on the south and east . . . Holston Hills dates from the mid-1920s, when part of the neighborhood was developed in connection with the establishment of the Holston Hills Country Club. A group of Knoxville area businessmen who wanted Knoxville to have a top-caliber golf course formed a corporation called Holston Hills, Inc. in 1926 and purchased the 180-acre McDonald farm along the Holston River. The Country Club was built and memberships to the club cost $1,000, including a free home site. The club house was designed by Knoxville architect Charles Barber of Barber & McMurry in 1927 and the golf course was designed and laid out by Donald Ross in 1928. Ross is regarded as among the finest golf course architects in the world.

Many opulent homes were built during the 1920s, but following the stock market crash of 1929 smaller cottage-style homes were built, many of stone and brick. The depression and World War II stopped further housing development, but in the post-war housing boom a number of ranch-style homes were built around the traditional 2-story stone and brick homes of the original development. Holston Hills was included in a major annexation into the city of Knoxville in 1962, which took 12,871 residents.

Take a look at the Knox Heritage website, which includes the full brochure from the '05 Trolley Tour of Holston Hills, from which the above information was taken. The brochure has more detailed information on individual homes in Holston Hills, and could easily be used to recreate that tour in your own vehicle one fine spring afternoon.

Holston Hills*

Current On-Market Listings - 16
Average Asking Price: $201,600
Median Asking Price: $182,400
Average Square Footage: 2333
Most Expensive Listing: $359,900 (3 BR, 3 BA, approx 3300 sq ft)
Least Expensive Listing: $109,900 (3 BR, 1 BA, approx 1900 sq ft)

Current Pending Sales -2
Average Asking Price - $173,500
Median Asking Price - NA

Closed Sales - March 2007 - 5
Average Sales Price - $198,300
Median Sales Price - $161,500
Average Days on Market - 95

Closed Sales - February 2008 - 4
Average Sales Price - $135,425
Median Sales Price - $134,400
Average Days on Market - 105

*Data taken from KAARMLS on 3/31/08 for Holston Hills proper, and does not include adjacent subdivisions, condos or PUDS.

I will update the closings for '08 if any more latecomers get entered in this evening or tomorrow.

If you want any more information about any of these properties, just give me a shout.

I'm almost out of "Hills." What neighborhood would you like to see here next week?

Got Real Estate Questions?

Question of the Week is coming! All Around K-Town needs to know what you need to know about the Knoxville real estate market, home buying or selling, or anything else real estatish. Don't be shy, just drop me a line.

This Week's Poll: Who's to Blame for the Mortgage Meltdown?

This week's poll is up. Please to enjoy to your left over there.

And yes, I'm totally phoning it in this weekend.

Things Look Sunny for K-Town

What's with Knoxville and lists? Not only did we make all those Forbes lists, K-Town was just named one of 12 solar cities. According to WBIR.com:

The city of Knoxville is one of a dozen cities nationwide receiving federal money to boost solar power use.

It was selected as a Solar America City by the Department of Energy.The designation means a $200,000 grant plus technical assistance.The Tennessee Valley authority plans to chip in an additional $100,000 over the course of the two-year project.

Show Some K-Town Love

Show some K-Town love by subscribing to All Around K-Town - c'mon, you know you wanna!

A Better Way to Get Around K-Town

I wanted to make a really bad pun about blog traffic here, but this new traffic blog deserves better. Don Jacobs' Navigating SmartFIX40 blog is up and ready to help you navigate your way through "the most expensive highway project in the state's history." Jacobs says:

On May 1, the downtown section of Interstate 40 will be closed, forcing out-of-town drivers onto designated detour routes, and providing residents an opportunity to find new ways to get to work, shop and frolic.

Anyone who can use the word "frolic" in a sentence describing a 14 month road construction project is ok in my book.

Hat tip to Knoxify for the heads-up on this one.

A Little Too Close to Home

Just saw this story over on KNS:

Knox County Sheriff's Office deputies serving an arrest warrant Wednesday night uncovered a methamphetamine lab in a West Knox County subdivision, authorities said.

Deputies from the KCSO Narcotics Unit arrived at the home, 830 Kevin Road, in the Crestwood Hills subdivision off Walker Springs Road around 5 p.m. after getting a tip from a local neighborhood watch member, KCSO Assistant Chief Deputy Robert Sexton said.

Yikes. As if that weren't bad enough, one of the comments on the story was making fun of this happening in "toney [sic] west knox."

You see, that kind of makes me nuts.

The scary part about this story is not that the meth lab was discovered in West Knoxville, but that it was discovered in a nice, quiet, well-populated subdivision at all.

The question to ask is not how could this happen in West Knoxville, but could this possibly be happening in any other otherwise respectable neighborhoods, be they North, South, East or West?

Introducing: Question of the Week

Have a question about Knoxville real estate or real estate in general? Lucky you, because you can now send your questions directly to me and I will try my darndest to answer at least one each week. So what are you waiting for? Fire away!

Winona Ryder Caused the U.S. Housing Crisis

I'm a little upset. I just found out that my generation is responsible for more than the gratuitous wearing of flannel, the death of Kurt Cobain, the rise of Courtney Love, Winona Ryder in general, and the tech boom and subsequent crash. According to Generation X Finance, Gen X'ers may also have caused the current mortgage & housing crisis. How, you ask?

1. We were too darn optimistic.

Generation X Finance:

If we look at the position of Generation X in the economy, a noticeable trendemerges. The majority of those in this generation that attended collegegraduated in the mid- to late-90s. What was the economy doing then? We wereinthe midst rapid technology growth, and the sky was the limit. The economy wason fire, high-paying jobs were almost being handed out upon graduation, and lifecouldn’t have been better for this generation....
..But without being able to experience or understand the effect of inflation rates in the double-digits and what a bear market feels like, this generation had unbridledoptimism as they set out on their own.

Unbridled optimism? Really? Didn't this guy see Reality Bites?

2. We were childless, overeducated, and rolling in the dough.

Gen X Finance:

Without a family or children to support, the booming economy presented opportunities that most young adults could only dream of. Unlike their boomer parents who typically worked blue-collar jobs and didn’t venture far from their roots, many Gen Xers saw an opportunity to take dream jobs almost anywhere in the country.

And lose them one or two years later in the tech crash, causing them to go home and cry to their mamas. I know - it happened to me.

3. We were overly mobile and buying more house than we could afford.

Gen X Finance:

Since people were not often bound to their hometown by a spouse or young child, this allowednew graduates to pick up and move to the hottest areas in the country. Of course, with the salaries being offered and few financial obligations, this meant many could buy the house of their dreams at a very young age.

Ok, maybe I just didn't have the right friends. I had lots of friends that moved to New York, Chicago and San Francisco during this time and none of them bought homes. They either a) couldn't afford to, b) didn't have the credit to, or c) were scared to, knowing their new "dream jobs" could go up in smoke at any minute.

The people I knew who stayed in Knoxville and bought homes, bought small homes that actually had lower mortgage payments than they were paying in rent.

4. We lost our shirts in the tech crash because we didn't see it coming.

Gen X Finance:

Suddenly, those living the high-life are faced with increased expenses and potential income loss. This is a bad situation to be in if you were dedicating 30-50% of your income to housing. Now, the generation that has experienced nothing but good times is completely lost.

I worked for a software company/internet start-up from 1998 to 2001. Trust me, the only people who didn't see the writing on the wall were the 40 and 50 something CEOS with dollar signs in their eyes. The rest of us rode it out, hoping for a decent severance package.

In summary, the Gen X Finance article states:

When you combine a generation of people who were possibly biting off more than they could chew and leaving themselves unable to cope with economic changes, you find the effect on housing, real estate, and credit to be very significant across the board.

Whatever. Maybe I'm prejudiced, but my experience with my generation has been that we are extremely resillient. I would be interested to know how many of the "4 million foreclosures" that McCain talked about today belong to Gen X'ers. And while I'm sure some of us played a part in what is playing out in the US economy right now, I seriously doubt if we, as a generation, caused it. This situation comes down to a lot of bad personal decisions by many different individuals, all of whom didn't want to admit to themselves that if it seems too good to be true, it probably is.

But you can still totally blame Winona Ryder if you want to.

Can an Agent Use Commission to Pay a Buyer's Closing Costs?

This question comes from the Tennessee Association of Realtors Hotline, where agents can ask questions regarding Tennessee real estate law :

QUESTION: Is it still allowable for a real estate agent to apply a portion of her percentage of commission to the purchase price for a buyer? If so, what is the proper way to word this in a contract?

ANSWER: NO, this is no longer permitted. We recently discussed this issue with the Tennessee Real Estate Commission, and they are of the opinion that the new statute regulating cash gifts, Tenn. Code Ann. 62-13-302(b) will NOT allow the paying of closing costs for their client. This new law states "A real estate licensee shall not give or pay cash rebates, cash gifts or cash prizes in conjunction with any real estate transaction. As part of the Tennessee Real Estate Commission's general rulemaking authority the commission may regulate the practices of real estate licensees in regard to gifts, prizes or rebates that are
not otherwise prohibited by law."

This is a change in the previous rules governing this type of activity. The Real Estate Commission is of the opinion that the paying of closing costs would amount to a cash gift. You can still offer to cut your commission, but this would require that the sales contract be amended in order to reflect that the price has been changed. For example, if you are offering to reduce your commission by $1,000.00, the sales contract would have to be amended demonstrating that the sales price has been reduced by $1,000.00.


To be clear, sellers are allowed to help with a buyer's closing costs, but usually only up to 3% on a conventional loan.

And please don't ask me to cut my commission. It makes me cranky.

Price Conquers All

If Knoxville sellers won't listen to us Realtors, maybe they'll listen to Glen Reynolds:

"A STREET IN MY NEIGHBORHOOD HAS HAD FOUR HOUSES FOR SALE for a long time. Last week they all sold. Hardly evidence of a trend by itself, but there is this report: "Sales of existing homes in the U.S. unexpectedly rose in February for the first time in seven months, easing concern credit restrictions and falling prices would hurt demand." Most of the houses in my neighborhood dropped their price. My sense overall is that homeowners are much too slow to drop their prices in a bad market -- people can accept that a stock might be worth less than last year, or worth less than when you bought it, but they seem to have a hard time mustering the same acceptance where a house is concerned. But drop the price, and it's more likely to sell. And that's what people will have to do, I think. Perhaps they're catching on."

Yes, perhaps they're acknowledging one of the only universal truths in real estate:

Price conquers all!

Neighborhood of the Week: Lakemoor Hills

Since last week's NOTW was Sequoyah Hills, I thought Lakemoor Hills would be interesting to look at this week. Also known as the "poor man's Sequoyah" or "Sequoyah South" due to its location across the river from Sequoyah Hills, Lakemoor Hills is a beautiful, established community just off of Alcoa Highway at Maloney Rd. But don't let the nicknames fool you - with over 250 homes, many with lake frontage, lake views, or ample acreage, Lakemoor Hills is by no means a second class neighborhood.

Lakemoor Hills*

Current On-Market Listings - 6
Average Asking Price: $474,943
Median Asking Price: $369,900
Average Square Footage: 3437
Most Expensive Listing: $995,000 (5 BR, 5 1/2 BA, over 6500 sq ft on over 4 acres)
Least Expensive Listing: $229,900 (3 BR, 2 BA, approx 1833 sq ft)

Current Pending Sales -0
Average Asking Price - NA
Median Asking Price - NA

Closed Sales - February 2007 - 1
Average Sales Price - $495,000
Median Sales Price - NA
Average Days on Market - 160

Closed Sales - February 2008 - 0
Average Sales Price - NA
Median Sales Price - NA
Average Days on Market - NA

*Data taken from KAARMLS on 3/24/08 for Lakemoor Hills proper, and does not include adjacent subdivisions, condos or PUDS.

What neighborhoods would you like to see featured in the future? Any other stats that you're itching to have?

The Truth About Open Houses

Today (being Easter) is the first Sunday in I don't know how long that I haven't spent doing an open house & I have to admit I never quite know what to do with myself with a whole free Sunday. A Sunday with no open house is like peanut butter with no jelly.

Why do I love working on Sunday so much while my husband enjoys his day off? Is it because I love cookies and lemonade? Or because I love playing Scrabble on my cell phone for two hours straight on the days when nobody comes through the door at all? Is it because I want to be like Carolyn Burnham, everyone's favorite Realtor from American Beauty? Or maybe because I love risking my life by dodging across traffic on Kingston Pike to put out open house signs?

No. I do it for the buyers. Well, and the sellers too.

The Buyers

Open houses have always been great places for Realtors to pick up potential clients, but even more so in this day and age when it's easier to find unicorns wandering Wal-Mart than it is to find qualified buyers. Sure, most people start their home search online, but the next place they go is open houses.

I learned how to work open houses early on. It's how I got my start in the business and also how I wound up closing 4 homes in my first summer. I didn't have my own listigs, so I sat in other agents' listings. I'd say about 3/4 of open houses are not held open by the listing agent. Do you think Big Time Agent X is doing an open house every Sunday? Probably not anymore, or if so, only on his or her very high profile listings. That's what new agents are for. New agents will sit in your open house all day long because they are hungry for business.

Let me give you lookers a quick tip: if you don't want to be pestered by an open house agent, tell them, as soon as you walk through the door, that you are already working with another agent. It's like Realtor repellant. Agents are not allowed, by Tennessee state law, to mess with someone who is already working with an agent. You're welcome.

A lot of listing agents don't do open houses, saying that open houses don't sell homes. Statistically speaking they don't -- I've only done it once, and it was in the first summer.

But I don't expect to sell the house I sit in. What I do hope is to sell you on using me as your buyer agent when you buy your next home.

The Sellers

These days I have my own listings, and a softer market can make selling them very stressful. Sellers don't like longer days on market and fewer showings per week. Sellers like activity an open houses are a great way to generate it.

I've already said that an open house may not sell my listing, but that doesn't mean that open houses are wasted marketing. I have an awesome listing right now in Fountain City that is absolutely adorable with tons of updates and a great, level backyard. But none of this home's awesome features matter a bit if nobody goes inside to see them. Open houses have been a great way to get people in the door of that house, and hopefully spread the word to other potential buyers.

Open houses are also a great way to get some brutally honest feedback. Trust me, if people don't like that green shag carpet or think the price is too high, I'm going to hear about it.

So, today I'm going to try to enjoy the rest of my Sunday off. No cookies to buy, no signs to pick up or put out. Maybe I will eat the chocolate bunny I got or maybe I will attempt to clean the house. Today I will try to relax. But tomorrow I will already be thinking about next Sunday, and where I'll be doing my next open house.

One Stop Knoxville Info Shop

Check out Knox'd, a new website with "the latest headlines from the best of Knoxville" - kind of a one stop Knoxville info shop. Very cool.

Thanks to Michael Silence for the tip.

February Homes Sales Report Revisited

Just what you wanted this week, more numbers, right? Josh Flory over at Property Scope has done his write-up on the Knoxville February Home Sales Report and he asks an interesting question:

"The median price for homes with two or fewer bedrooms, or four-plus bedrooms dropped, though. At the small end of the spectrum, the median price fell by a whopping 19.9 percent, to $62,500, while the median price at the high end fell by 3.7 percent, to $240,000.

Any thoughts on why this happened? One interesting quirk is the fact that there were 14 homes in the smallest category that sold for less than $20,000 in February, compared to only three in that category during February of 2007."

I have no idea about the homes under $20,000 quirk, but as for the other, I think the answer has to do with the tightened mortgage qualificaiton criteria. People who would have bought on the lower end last year simply could not qualify this year, while folks looking to buy on the high side wound up qualifying for less loan and had to buy less house.

Does that make sense to anybody else or have I not had enough coffee today?

Get the Skinny on Your Zip Code

One question buyers, especially out of town ones, always ask when we're out looking at property is, "Is this a good area?"

Very fair question. Too bad I can't answer it.

Due to fair housing laws, not to mention general liability issues, agents really can't tell you if neighborhoods are "good" or "bad." Now, you can usually look around and see if you're in Dumpsville or not - cars up on blocks in the front yard, weeds everywhere, the garbage man is too scared to come and get the trash (don't laugh, I've seen it).

But what about if there are no obvious signs?

Try Zip Skinny, a site that provides US Census and data information by zip code. Basic information on a zip includes education levels, marital status, household income, and occupations of the residents. Zip Skinny will also:

• compare info on different zip codes
  
• provide information on schools


• show you a map marking the geographic center of the zip code
  

I looked up my zip, 37919, and found out that over 50% of the residents have at least a BA degree, almost 1/2 have lived in their home for 5 or more years, the median age of residents is 36.8 years, and only 2.1% are unemployed.

Check it out and let me know what you find out about your zip.

K-Town Makes More Lists

Yesterday I posted about Knoxville making the Forbes list of best places to buy foreclosed homes.

Today the Knoxville News Sentinel says Knoxville has once again made the Forbes lists for best metro areas for careers and best cities to do business:

"A low cost of living, an available work force and the region's location at the intersection of three major interstate highways, are among the factors driving job growth in the area...

The magazine cited the region's relatively low business costs - 14 percent below the national average - as one of Knoxville's strengths."

Knoxville Chamber President and CEO Mike Edwards comments on the rankings to KNS:

"Corporate America continues to look at indicators such as Forbes' rankings and they continue to see Knoxville listed. … These rankings drive interest in Knoxville and people give us a look that they may not have given us years ago."

Knoxville 7th Best Place to Buy Foreclosures

Forbes.com just named Knoxville the 7th best place in America to buy a forclosed home, and no, that doesn't mean our housing market is tanking. It's actually a good thing.

Forbes is saying that Knoxville, and the other 9 cities on their list are places worth investing in not only because their real estate markets are not totally tanked, but also because they're actually showing signs of growth.

According to the article:

"Only today's bravest buyers would consider homes in cities like Las Vegas and Tampa, where rampant foreclosures are sinking already weak real estate markets.

But in markets in other cities, where there are hints of stabilization, foreclosed properties might be a good investment. "

Hey, I'll take a hint of stabilization over signs of certain demise any day.

To come up with the list, Forbes looked at median home price, spread between median prices and foreclosure prices (foreclosure savings), annual foreclosure rate, and median home price change from 2006 to 2007. Here are the stats for Knoxville:

Median home price: $125,150
Foreclosure savings: $30,696
Foreclosure rate: 0.6%
Price change 2006-2007: 3.43%

And yes, that 3.43% price change is a good thing.

I've listed all 10 cities on the list below.

1. Charlotte, N.C.

2. Raleigh, N.C.

3. Nashville, Tenn.

4. Oklahoma City, Okla.
5. San Antonio, Texas

6. Albuquerque, N.M.

7. Knoxville, Tenn.

8. Seattle, Wash.

9. Indianapolis, Ind.

10. Washington-Arlington-Alexandria

February Home Sales Report

Better late than never - the February Home Sales Report numbers from KAARMLS are up. Let's start with the good news first:

Average condo sales price is up.

Feb '07 - $164,300

Feb '08 - $169,500

Average sales price for homes with 4 or more bedrooms is up.

Feb '07 - $293,700

Feb '08 - $303,000

Now for the not so good news -

Average sales price for 3 BR homes is down.

Feb '07 - $182,700

Feb '08 - $155,000

Median sales price for 3 BR homes is down.

Feb '07 - $141,600

Feb '08 - $145,000

Median sales price for homes with 4 or more bedrooms is down.
Feb '07 - $249,300
Feb '08 - $240,000

Total number of single family unit sales is down.

Feb '07 - 1,160

Feb '08 - 902

Days on market is up.

Feb '07 - 94

Feb '08 - 100

And finally, here's the "sellers are either in total denial or are eternal optimists" news:

Average listing price for new listings is up.

Feb '07 - $246,100

Feb '08 - $264,600

So, here's my not so scientific analysis:

1. The condo market is still chugging right along.

2. Residential sales are still soft*.

3. Sellers think it's still 2005.

*Please keep in mind that lower average sales price and lower median sales price do not necessarily mean that your personal home has depreciated.

Foreclosure: It Takes Two to Tango

There's a great post today over at Generation X Finance about a story that ran on CNN yesterday. The story was about a couple who lost their home to foreclosure and are now living in a camper. On the surface, this sounds like the saddest story in the world. Until you hear the details:

1. Couple buys 2,700 foot home in Las Vegas for $265,000 with a no money down,interest only loan.
2. Thanks to the booming Las Vegas real estate market, the home doubles in value in a year.
3. Wife loses job, and the couple takes out a home equity line of credit to help pay the bills that are piling up, inlcuding the mortgage.
4. Couple tries to sell their home, but the Las Vegas housing bubble has burst.
5. Broke and unable to sell their home, the couple takes out another $35,000 loan to pay the mortgage.
6. Couple home is foreclosed on by the bank and they are now living in a camper.
7. Couple blames foreclosure on lender, saying their loan docs were "confusing and hard to understand."

The bolded parts of this story are the mistakes that Gen X Finances says the borrowers made. I know what I think about all of this and if you read Gen X Finances original post, you'll know what they think too.

What do you think? Were these people taken for a ride by unethical borrowers or did they dig their own financial hole? Should borrowers in general take more responsibility for the current mortgage crisis?

Neighborhood of the Week: Sequoyah Hills

Sequoyah Hills*

Current On-Market Listings - 36
Average Asking Price: $737,722
Median Asking Price: $556,950
Most Expensive Listing: $2,250,000 (4 BR, 5 1/2 BA, over 5000 sq ft, lake front)
Least Expensive Listing: $274,900 (2BR, 1 BA, approx 1800 sq ft on Southgate)

Current Pending Sales -5
Average Asking Price - $394,460
Median Asking Price - $349,900

Closed Sales - February 2007 - 1
Average Sales Price - $499,900
Median Sales Price - NA
Average Days on Market - 133

Closed Sales - February 2008 - 4
Average Sales Price - $396,506
Median Sales Price - $377,512
Average Days on Market - 122

Interesting that both of the neighborhoods I've looked at so far have had more sales in '08 than '07. I'm curious to see if that trend continues in other neighborhoods as well.

Any suggestions for next week's NOTW?

*Data taken from KAARMLS on 3/17/08 for Sequoyah Hills proper, and does not include adjacent subdivisions, condos or PUDS.

Property Marketing, East Tennessee Style

All you non-Realtor types out there probably don't know about MLS E-Flyers. The concept is simple: instead of sending out 100s of paper flyers to agents all over Knoxville to market new listings or price reductions, you pay some money to an online service like MLSflyers.com, make an E-flyer and send it out to every member of the Knoxville Area Association of Realtors. Yes, it's kind of spam, but a) it only spams Realtors, b) it sells houses and c) it saves trees, so we deal with it.

So, one of my first tasks of the day is to click through these flyers that have accumulated in my inbox overnight. Usually they are pretty standard. Occasionally they here unintentionally hilarious. Here is a headline from an E-Flyer I opened up this morning:

SELLER WILL GIVE BUYER A $1000 WALMART GIFTCARD AND ONE YEAR SATELLITE TV!!!

Not mentioned in the flyer, but perhaps easy enough to guess is that this "home" is also very portable:

Fun FHA Facts

Word on the street is that FHA loans are the new subprime, and according to recent news, there may be even better news on the horizon for borrowers with less than stellar credit, even those who need to refi.
What with all the subprime hubub, FHA loans haven't come into play as much the last few years. According to Investopedia.com, an FHA loan is:

"A mortgage issued by federally qualified lenders and insured by the Federal Housing Administration (FHA). FHA loans are designed for low to moderate income borrowers who are unable to make a large down payment. FHA loans allow the borrower to borrow up to 97% of the value of the home. The 3% down payment requirement can come from a gift or a grant, which makes FHA loans popular with first-time buyers."

But it's not only low to moderate income borrowers or first time home buyers who can benefit from an FHA loan. FHA is also good if your credit score is a little low. FHA will accept a minimum credit score of 580, whereas the minimum for a conventional loan has gone up to 620. It definitely gives you a little more wiggle room.

In addition to allowing a 3% gift, FHA also allows up to 6% in seller concessions, almost twice what most conventional loans allow. That's a lot of closing costs!

Best of all, the FHA loan limit for Knox county was just raised to $271,050 (FHA loan limits for others counties can be found here). With that kind of money, you can almost certainly find yourself some very sweet digs in our fine city.

You Likey?

I'm going to be tweaking the All Around KTown look this weekend, so bear with me for a few days.

What do you think of the new header? Yay? Nay?

3 Reasons Knoxville is a Great Place to Live

Money magazine is getting ready to put together a "best places to live" list and they're asking people to tell them what exactly is it that makes a city a good place to hang your hat. Is it the schools? The weather? The cultural attractions?

This got me thinking about why it is that I call Knoxville home. You see, I am not a native Knoxvillian. I am originally from the Music City, a fact I don't loudly declare around these parts too often. Not being born here means I chose Knoxville as my home. My husband also chose this city as his home before we met and we both agreed before getting married that this is where we will stay.

So what are my reasons for adopting Knoxville as my hometown? There are many others (King Tut's, Fellini Kroger, Disco Kroger, West Town Target, Matt Hinkin's hair, McKay's, & Taste of Thai, just to name a few), but the three big ones are:

1. It's got good folks.

For me, one of the things that I love about Knoxville is the people. Knoxvillians are some of the friendliest people I've ever come across, and I often hear the same thing from people relocating to this area. And I'm not talking about that fake Southern niceness, either. This is a geniune kindness that you're not going to find as readily in the 615 or 901 area codes.

2. It's real pretty.

In fact, I would go so far as to say it's downright beautiful. A few years back I had to move to Memphis for a while and I couldn't take it. No hills, no big leafy trees, no mountain views. Living in Knoxville for an extended period of time will ruin anywhere else for you scenery wise.

3. It's cheap.

The cost of living in Knoxville is incredibly low, even compared to other cities in Tennessee (namely Nashville). Home prices, especially, are very affordable. And as much as native Knoxvillians may not think so, our property taxes, relative to other areas, are also pretty reasonable.

We all call Knoxville home for a reason, either big or small. What are your reasons for choosing Knoxville? What do you think makes KTown a great place to live?

Wednesday Link Round-up: List Edition

10 reasons to hire a real estate agent - The City Wire

7 million dollar foreclosures - CNNMoney.com

5 possible trouble spots in your home - RealEstateJournal.com

Update: Kingston Woods

I mistakenly left West Oaks out of the neighborhood of the week stats I posted yesterday. West Oaks is part of the conglomeration of neighborhoods I'm referring to here as Kingston Woods. However, it turns out I didn't miss much. There are no current pending sales in West Oaks and no sales in February '07 or '08. There is, however, one listing, 732 Waco Rd (not that Waco), with an asking price of $149,900.

Sorry West Oaks!

Neighborhood of the Week: Kingston Woods

Here goes nothin'. I'm trying out a new weekly post here called, you guessed it, neighborhood of the week. Each week, on Monday, I'll highlight current listing, pending, and sales data for one Knox County neighborhood.

The first neighborhood was an easy choice - it's mine! I live in a huge neighborhood south of West Town Mall, which is technically comprised of Kingston Woods, Kingston Park, & Kingston Hills. I'm lumping all three of these together and calling them Kingston Woods for the purposes of these stats.

Kingston Woods

Current* On-Market Listings - 6
Average Asking Price: $216,583
Median Asking Price: $214,900

Current Pending Sales -2
Average Asking Price - $186,975
Median Asking Price - NA

Closed Sales - February 2007 - 0
Average Sales Price - NA
Median Sales Price - NA
Average Days on Market - NA

Closed Sales - February 2008 - 2
Average Sales Price - $217,400
Median Sales Price - NA
Average Days on Market - 90

*Data taken from KAARMLS on 3/10/08

What other neighborhoods would you like to see stats for? Any suggestions for the type of stats you'd like to see?

5 Reasons You Should Learn to Love the Split Foyer

A recent article on RealEstateJournal.com stated that only 9% of Americans prefer split-level, or as they're called around these parts, split foyer, style homes to other home styles.

Maybe it's just that I'm a child of the 70s, raised in those split-foyer basements, but I don't get what's not to love. Here's 5 reasons I think they're worth reconsidering.

1. There are a lot of them.

According to that Realestatejournal.com article, back in 1980, 20% of us thought split-foyers were pretty groovy. And in 1979 11% of all new homes built were split foyers. That means there's still a lot of them around. 107 on the market in Knox county as of today, to be exact (by the way, this number does not include the tri-levels, which are a similar animal, but with their own redeeming qualites. More on those later).

2. A split foyer doesn't always come with green shag carpet and wagon wheel light fixures.

True, walk into some split foyer homes and you'll be instantly transported back to 1973. But others have been updated and have no trace of the 70s or 80s at all. For example, those current split foyer listings include a stately Holston Hills home (list price $349,900) with almost 4,000 sq ft located within walking distance of Holston Hills Country Club and a cute as button renovation (list price $187,500) in Kingsgate in Farragut with all new kitchen and bathrooms. No shag carpet in sight.

3. Because they're not as popular, you'll be in a better negotiating position when buying them.

It's simple supply and demand. Let other buyers fight over those little ranchers. Learn to love the split foyer and you might just get more bang for your buck.

4. They have tons of liveable space.

One level living is great, but high ceilings and open floor plans don't always equal easy livability. There's a reason split foyers used to be so popluar - the floor plans are kind of ingenious. There's very little wasted space and that lower level is a teenager's/crafter's/tinkering husband's delight. That is definitely where my husband and his X-Box would be spending their quality time together.

5. You'll have buns of steel in no time.

And save loads of money on gym memberships to boot. One reason split foyers have gone out of style is the stairs. No one wants to climb them. But why are stairs a bad thing? All we hear every day is how we need to exercise more. Why not get your exercise by walking from your garage to your living room every day? Or by carrying the laundry up and downstairs?

So go ahead, give the split foyer a chance. You might just find out you really like it.

Real Estate Web Sites: Cutting the Cheese

I started writing a post last week about real estate websites. The title was going to be something like, "10 Good Real Estate Web Sites," but I got stuck on about #3 before I had to run off and show more houses. Then I came across this article over on Inman News and I didn't feel so bad about not being able to get to #4. After looking at the first 100 results returned by Google when searching the term "real estate," the author says that all 100 websites came up short. What were they lacking?

"Truth. Honesty. A real voice. Every site I visited spoke to me with a voice wholly not its own, spewing every real estate cliché under the sun."

In a word, they were cheesy.

One of the reasons I started All Around Ktown was, ok I admit it, business was slow.

Another reason was that I was incredibly angry with the folks hosting my personal business web site, which, in the interest of full disclosure, I will hereby admit is about as canned and cheesy as they come. In my defense, I was somehow tricked into a year contract that I never agreed to, much less signed, but which it appears nothing short of litigation is going to let me out of. Believe me, I've tried. Being the cheapskate I am, I refuse to relocate my domain name while I'm still paying for the wretched site and hosting. So, my brain said, "Hey, let's get another domain and forget those guys over at Shmealtor.shmom. We'll blog!"

And the final reason I started All Around Ktown was that I was looking around to see what was out there on the web about real estate, and Knoxville real estate in particular, and found that most of it was just canned cheese designed to get your business.

Popular thought among most Realtor-types holds that time not spent "prospecting" (when did we all become gold miners, anyway?) is wasted time. And time is, of course, money. Sell, sell, sell!

Why take time to produce (what I hope is) quality content that (I hope) people enjoy and why provide (again, what I hope is) timely information that others can (hopefully) use , when you can just hire a company to auto-produce your real estate blog content for you (yes, there are companies that will do that, and no I'm not going to link to them because they're evil)? Best of all you don't even have to try to relate to people or be original in any way! Easy cheesy!

But it's not so easy being cheesy. First, it costs a lot of money. Auto-populated website or blog content doesn't come cheap. And second, throwing up canned content in the hopes of snagging a "prospect" or two is just silly. You might even say it's a waste of time. People aren't stupid. They know when they're reading canned content and it doesn't impress them. It insults their intelligence and that's no way to do business.

So, I hope that you, gentle reader, do not find what you read here the slightest big intelligence insulting or to have even the slightest hint of cheese, be it cheddar, nacho, mozzarella, or even Emmentaler. Because if you do, that would mean that I am truly wasting my time.

100 Web sites, one unfulfilling experience - Inman News

Jan Nielsen's Mad...

...and he's not gonna take it anymore! Mr. Nielsen is a local builder, who, according to the Knoxville MLS, currently has 5 homes for sale in Saddle Ridge in Farragut. I got a mass email sent out by Jan the Builder today and he's not happy about what the media is saying about home prices:

"I am sending this message out of frustration with articles in the media telling us that home prices are down and going further down. Nothing could be further from the truth here in Knoxville.The News- Sentinel, and other media, report prices DOWN over 8% for 2007, but this is based on the Case-Schiller index which measures only the 20 largest metropolitan areas.On the contrary, the OFHEO, which is HUD's office measuring same house sales across the nation, reports that Knoxville had an average appreciation rate of 5.8% UP for 2007.Furthermore, Tennessee was UP (4.1%), our East South Central region was up (4.1%), and the nation was up (0.8%) for all transactions (includes appraisals for refinancing.) You would never guess that 2 out of 3 states reported positive appreciation rates in 2007.You can check this yourselves by visiting ofheo.gov. I bring it to your attention because everyone should know that prices are continuing to go up, not down, in Knoxville."

OFHEO, for the uninitiated, is the Office of Federal Housing Enterprise Oversight. When I actually have time to breathe, I'm going to check out Mr. Nielsen's numbers.

I did have time to check out the House Price Calculator located on their website. According to this nifty tool, my home, which I bought 2nd quarter '06, had a little more than 8% appreciation by 4th quarter '08. I'll take it!

Downtown at Farragut

According to Property Scope, the mixed used town center project, Downtown at Farragut, is moving forward:

"Developer Michael Bates said his firm expects to buy the property and break ground on the site within two months.

The project is slated for 68 acres on Kingston Pike between the Town Hall and Kohl's, land that is currently owned by the family of Farragut mayor Eddy Ford. Bates' plan calls for a town square surrounded by more than 175,000 square feet of retail/dining/entertainment space and 150,000 square feet of offices. Loft residences would be located on upper floors of the buildings."

Check out the rest of the article-

Downtown at Farragut update - Property Scope

Stigmatized Properties: Full Disclosure

Most homeowners in our area know they have to fill out a Property Condition Disclosure form when they are selling their home. And most people know that they are supposed to disclose any adverse facts about the home's physical structure, such as a past water leak or a problem with the foundation.

But occassionally agents and homeowners are faced with selling stigmatized properties - properties that have emotionally distressing histories. Stigmatized properties include homes where a violent crime has occurred or where a previous occupant was infected with HIV. So what do you have to disclose in these situations? According to Tenn. Code Ann. 66-5-207, real estate agents and homeowners do not have to voluntarily disclose

1. Whether anyone who has ever lived in the home was infected by the HIV virus or "other disease which has been determined by medical evidence tobe highly unlikely to be transmitted through the occupancy of a dwellingplace."


2. If a felony occurred on a the property.


3. If a suicide occurred on the property.


4. If a homicide occurred on the property.

According to the code, these are all things that would not affect the dwelling's physical structure, and therefore are not "property conditions" per se.

Even though homeowners do not have to disclose violent crimes in their property disclosures, their agents are required to honestly answer any questions potential buyers may have about such crimes having occurred in the home. If you want to know if a violent crime has occurred in a home that is for sale, try asking the listing agent directly. If you ask directly, and the agent has knowledge of such a crime, he or she is required to tell you.

The same is not true if you ask about HIV or AIDS. According to Realtor magazine:

"As part of its fair housing rules, the U.S. Department of Housing and Urban Development has said it's illegal for real estate professionals to make unsolicited disclosures that a current or former occupant of a home has AIDS, and advises practitioners not to respond to direct questions on this topic from buyers."

Oh, and rumor has it that we also do not have to disclose whether or not a home is haunted. Boo!

Not Nashville, But Also Not Memphis

Could you describe Knoxville in just six words?

Before You Make That Lowball Offer...

Lowball offers are the new black. Every time I go to the office, I hear another horror story about someone's client who insisted on submitting an obscenely low offer on a home, because said client has heard about how horrible the real estate market is. 9 times out of 10, two things are going to happen in this scenario:

1. Seller counters back at near listing price, offended by the lowball offer.

2. Seller rejects offer outright, offended by the lowball offer.

And a lot of times the buyer winds up losing the house either because someone else submits a reasonable offer, or because negotiations break down due to seller's aforementioned offense at low ball offer.

I blame all this lowballing on the media hype over "the national real estate market." The fact that there is no national real estate market escapes these people's notice (more on that later). Buyers think that the collapsing "national market" means they are going to steal houses in Knoxville.

As I've said here before, just because every business pundit on every news channel in the country is saying the real estate sky is falling, that does not mean that it's falling over Knoxville. Yes, we're in a buyer's market and buyers can definitely get away with asking for more concessions now than they could a few years ago. And that's a great thing for all you buyers out there. But with few exceptions, you're not going to get that $250,000 home for $200,000. Really, you're not. Sellers in some parts of the country may be desperate to sell, but most sellers here aren't. They're just really anxious to sell and there's a big difference between those two.

Having said all that, the lowball offer definitely does not have it's propert time and place. But let's start off by looking at where and when it is not a good idea:

• You really want the house.


• You're doing it "just to see" if you can get it, even though the comps and condition do not support a number anywhere near what you're asking.


• You want/need a lot of concessions from the seller.


• Your agent has strongly advised against it, knowing that you really want the house and/or the comps & condition don't support it.

If any of the above is true, you can stop reading this post and go make a reasonable offer.

If you're still in the running to lowball, you need to find out a few things. Ask yourself and/or your agent the following questions:

• Is the home overpriced?
  

Or maybe even grossly overpriced? Your agent can pull comps for you and help you find this out. If it is, your lowball offer is not really a lowball offer at all - it's a reality check for the seller

• Is the house falling apart, but is priced as though it's not?

Market comps ususally assume a home is in market ready condition. If the seller has priced his home at market, but the roof is falling in and it's 1972 inside, a lower offer might be justified.

• How long has the property been on the market?

The current listing sheet may say the home has only been on the market 30 days. But a quick look in the MLS may show you that this is the 3rd time the home has been listed, and all told, it's been on the market for over a year. Longer time on the market means more negotiating power for the buyer.

• Is the property vacant?

Has it been that way for a while? Nobody likes to have a house sitting empty, epecially when the house is in Knoxville and they are in Honolulu. Insurance companies don't like it either. And nobody likes making two mortgage payments.

• Is the seller motivated?

This is something you can't always know up front. But if you somehow find out the seller is getting divorced/about to go bankrupt and has to move that property, stat, then strike while the iron's hot.

• Are you hoping/needing concessions in the contract?

I mentioned this before, but it bears repeating. This is a can't have your cake and eat it too thing. If you need the seller to pay closing costs or pay for repairs up front, lowball is probably not the way to go. It adds insult to injury.

• Are you prepared to walk away from the house?

Repeat after me: the lowballer shall not get emotionally invested in a property. The lowballer must always be willing to walk. Lowballing is gambling, so be prepared to lose.

Ok, so you've asked the important questions and you have a yes answer to two or more. Now you want to lowball! Slow down, grasshopper. You have one, last very important task to complete -

Find out what the seller owes on the property.

It is very rare that a seller is able to afford to write a check at the closing table, much less agree to do it. In some situaitons coming out even will suit the seller fine, but paying someone to buy their home will not.

Once you know what the seller owes, you and your agent can formulate your offer accordingly

At this point, I will ask you one more favor. Please, please, please, please -

listen to what your agent has to say!

Because you do have an agent, right? And he or she is a professional, correct? Real estate is their job and negotiating contracts is their bread and butter.
If you don't trust your agent enough to listen to their advice, then maybe you should find another agent. Seriously.

Once you have your agent's blessing, go forth and lowball. It's apparently the hip thing to do.