How We Pick The Home We Buy
August 31, 2009
Interesting post from the Zillow blog that puts a little science behind what I’ve always told my sellers – home buyers make decisions based on emotion, usually within the very first few moments they’re in the house. In my experience, those first few moments make about 80% of the decision for a large portion of the population.
The post references a Katherine Salant column. Excerpts:
In the first two or three minutes you are in a model home, your sensory organs are feeding data into the emotional centers of your brain. As you glance at the living room, these emotional centers rapidly register the details.
Then, on the spot, the emotional networks vote up or down. The deal starts or ends with the firing of a few billion neurons.
If our nearly instantaneous visceral response is positive, our dopamine receptors go into overdrive, Lehrer said. They make us want that house, and they make us want it immediately.
Once your emotions have voiced their opinions, a different set of neurons in the frontal cortex, which control your brain’s "executive function," start to kick in. They generate seemingly logical reasons why a particular house is the one, Lehrer said. As you continue to think about this purchase, your list of good reasons gets longer: It has all the formal living and dining space that we need for resale! We’ll have a place to put great aunt Julia’s living room set, which we just inherited! We can have romantic dinners for two by the fireplace in the family room!
This is why I’ve always argued that the point of good home marketing is to get a potential home buyer inside the house. When I represent home sellers here in Tucson, I want to show people enough information, pictures, and details that they’re curious to see more, that they’re drawn to see the house in person. I want that visceral emotional reaction from those home buyers.
I don’t want someone looking online and rejecting a house because they looked at 50 pictures and decided they don’t like the oak cabinets or the guest bedrooms seem to small in the virtual tour – I don’t want potential home buyers dismissing a house out of hand because of some perceived flaw or omission, most of which could be changed or otherwise addressed. I want people in the house, seeing it in person, getting that emotional reaction. That’s successful home marketing.
All of which – if you’re looking to buy a home - is why you should work with an agent who knows your wants and needs, who understands that you can get caught up in that visceral reaction, and can remind you to evaluate the house from a more objective view point.
How We Pick The Home We Buy
August 31, 2009
Interesting post from the Zillow blog that puts a little science behind what I’ve always told my sellers – home buyers make decisions based on emotion, usually within the very first few moments they’re in the house. In my experience, those first few moments make about 80% of the decision for a large portion of the population.
The post references a Katherine Salant column. Excerpts:
In the first two or three minutes you are in a model home, your sensory organs are feeding data into the emotional centers of your brain. As you glance at the living room, these emotional centers rapidly register the details.
Then, on the spot, the emotional networks vote up or down. The deal starts or ends with the firing of a few billion neurons.
If our nearly instantaneous visceral response is positive, our dopamine receptors go into overdrive, Lehrer said. They make us want that house, and they make us want it immediately.
Once your emotions have voiced their opinions, a different set of neurons in the frontal cortex, which control your brain’s "executive function," start to kick in. They generate seemingly logical reasons why a particular house is the one, Lehrer said. As you continue to think about this purchase, your list of good reasons gets longer: It has all the formal living and dining space that we need for resale! We’ll have a place to put great aunt Julia’s living room set, which we just inherited! We can have romantic dinners for two by the fireplace in the family room!
This is why I’ve always argued that the point of good home marketing is to get a potential home buyer inside the house. When I represent home sellers here in Tucson, I want to show people enough information, pictures, and details that they’re curious to see more, that they’re drawn to see the house in person. I want that visceral emotional reaction from those home buyers.
I don’t want someone looking online and rejecting a house because they looked at 50 pictures and decided they don’t like the oak cabinets or the guest bedrooms seem to small in the virtual tour – I don’t want potential home buyers dismissing a house out of hand because of some perceived flaw or omission, most of which could be changed or otherwise addressed. I want people in the house, seeing it in person, getting that emotional reaction. That’s successful home marketing.
All of which – if you’re looking to buy a home - is why you should work with an agent who knows your wants and needs, who understands that you can get caught up in that visceral reaction, and can remind you to evaluate the house from a more objective view point.
$8000 Tax Credit for First Time Home Buyers – Expires Soon
August 26, 2009
I’ve talked about it a little in my Tucson real estate market reports, but for those that don’t know – there’s an $8000 tax credit for first time buyers that expires December 1, 2009.
The home buyer tax credit is only for first time buyers, according to the IRS. And those are people who have not owned a home in the last 3 years. Excluded from the credit are first time home buyers who file taxes separately and whose income exceeds $95,000, those who file jointly and whose income exceeds $170,000.
There are a few other guidelines – mortgage guru Dan covers them well in this article.
BUT – you have to close on your home on or before December 1, 2009.
Given a typical escrow is 30-45 days in Tucson – let’s use 45 days just to play safe – if we count backwards, that means you need to have a home under contract by October 16th. Throw in a couple of days for negotiating, and you need to be making offers probably by October 10th, at the absolute latest.
Which is in 46 days.
If you think you may qualify for this program and want to take advantage of it, it’s time to get moving. Get thee to a lender to get pre-approved, and get thee home shopping.
If you’ve got questions, send me an email. Happy to help where I can.
$8000 Tax Credit for First Time Home Buyers – Expires Soon
August 26, 2009
I’ve talked about it a little in my Tucson real estate market reports, but for those that don’t know – there’s an $8000 tax credit for first time buyers that expires December 1, 2009.
The home buyer tax credit is only for first time buyers, according to the IRS. And those are people who have not owned a home in the last 3 years. Excluded from the credit are first time home buyers who file taxes separately and whose income exceeds $95,000, those who file jointly and whose income exceeds $170,000.
There are a few other guidelines – mortgage guru Dan covers them well in this article.
BUT – you have to close on your home on or before December 1, 2009.
Given a typical escrow is 30-45 days in Tucson – let’s use 45 days just to play safe – if we count backwards, that means you need to have a home under contract by October 16th. Throw in a couple of days for negotiating, and you need to be making offers probably by October 10th, at the absolute latest.
Which is in 46 days.
If you think you may qualify for this program and want to take advantage of it, it’s time to get moving. Get thee to a lender to get pre-approved, and get thee home shopping.
If you’ve got questions, send me an email. Happy to help where I can.
HERA, HVCC, and Other Fun Acronyms- Ready for New Lending Rules?
August 3, 2009
Starting July 30th, 2009, there’s some new disclosure rules for mortgages - an update to the Truth in Lending regulation (also called Reg Z, if you want to use the fancy lingo). They call this one HERA - the Housing and Economic Recovery Act. The highlights:
- The new requirements apply to all mortgages where the owner lives in the property as either a primary or secondary residence, and includes refinances.
- Good faith estimates are to be provided within 3 business days after you apply for a loan, and the lender can’t collect any fees before that disclosure is provided - except to collect a reasonable credit report fee.
- Closing can’t happen until 7 days after you get that early disclosure, as a waiting period.
- If your APR increases by more than 0.125%, the lender has to give you an updated disclosure, and wait another 3 days before the loan can close. Remember that an APR includes not only the interest rate, but factors in other closing costs and fees.
So basically, you’re supposed to get disclosures earlier, not pay any big fees until you have time to review them, and if your costs and/or interest rate make a big swing, you’re supposed to get an updated disclosure.
Also - and this rule started May 2009 - for conforming loans, those that conform to Fannie Mae/Freddie Mac guidelines, there’s another rule. This one is HVCC - the Home Valuation Code of Conduct.
HVCC is an attempt to make the appraiser more independent - less likely to be influenced by a lender or an agent or a buyer or a seller - and to make sure a borrower gets to see their appraisal. HVCC states that borrowers receive a copy of their appraisal report no less than 3 days prior to closing their loan - unless the borrower waives this requirement.
There was quite a bit of hubbub when HVCC came out - that agents weren’t allowed to communicate with the appraiser, that they’d delay closing because of long appraisal timeline allocations, that appraisers were working in areas outside their expertise. FHFA issued a document to try and clarify some of those conerns. Fannie Mae has a FAQ about HVCC as well. And of course, links to all kinds of HVCC information over at Realtor.org.
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