The right way to take advantage of low downpayment loans.

An FHA loan is a great way for a home buyer to get into a property with a low down payment of only 3.5%. Although the initial fees are high, most of the costs can be covered by the seller at closing. This program allows many first time homebuyers who do not have a large down payment(10%-20%) to get into a home sooner. However, with any low down payment program, there are a few simple things that the homeowner should be aware of and be prepared for to ensure that they don’t run into financial problems later on when they sell since the cost of sale in MA can be anywhere from 5-7% of the sale price.

First, buying a home with a low down payment should be a long term commitment. If you are planning to stay only a few years and then selling, you should not be putting such a low down payment. I recommend buyers who put less than 5% down to stay a minimum of 5 years. This allows you time to build some equity in the home so when you are ready to sell, you are not bringing additional money to the closing table. Building equity in the home also opens you up to additional financing options which can decrease your monthly payments.

Second, when buying a home, you should never assume your property value will appreciate. It is true that real estate values go up over time, but that is calculated over 10-20 years. Based on today’s market, it is safe to assume that short term, real estate values will remain stable or decrease slightly. If you plan on moving in less than 5 years, plan your financials accordingly.

To properly plan your financials, you should pretend like you are saving to put 10% down. Open another savings account and put some extra money away each month such that when it comes time to sell, you have effectively 10% equity. For example, you buy a home today for $400,000 with 5% down. You plan on moving in 5 years. This means that you should set aside approximately $300/month to ensure there is 10% equity at the end of 5 years. The good news is that this forces you to save money and if you end up not needing these funds to sell, you are well on your way to saving for your next home or have extra money for emergencies.

Lastly, remember that low down payment loan programs are a great way to help buyers get into homes sooner and in many cases, owning is better than renting. However, owning a home does come with additional financial responsibilities and being financially prepared will help you make the transition much easier.

If you know anyone thinking of buying a home while interest rates are low and property values are low, please contact me and I will be happy to help.

More Condo Auctions in Natick

The new construction luxury condos located at 20 South Ave, Natick will be coming up for auction. Thirteen condominium units will be auctioned off on Thursday November 19th at 7:00pm. 11 of the units will be auctioned off with minimum bids of approximately 60% of recent List Price. 2 of the units will be auctioned on absolute basis where the highest bidder wins the unit regardless of how low the bid is!

These luxury 2 bed+ 2 bath+ 1500sqft-2000sqft condominiums are currently about 50% sold out and the developer has decided to auction off the remainder of the units for a quick sale. These units should sell for between $300k-$450k depending on size and unit placement.

If you are interested in taking a look at these, please contact me before the auction so we can go preview the property before auction day.

Also, I believe there will be more luxury condominium auctions coming up in Natick in the next year. Another project located at 93 E Central St(Castle Courtyard) currently has unrealistic expectations of their price and zero units have sold since they started market it over a year ago. I think this condo project will be the next one to go to auction so stay tuned!

Natick Mall Condo Auction Results

Here are the results for the condo auction. Moving forward, the remainder of the condos will be for sale at auction prices with minor price adjustments according to view and floor.

If you know anyone interested in buying or selling a home, please let me know! I'd be glad to help. Also, if you know anyone who might be interested in purchasing one of these condos in Natick, I can arrange for that as well.

Paul Shao
Keller Williams Realty
508-960-4095

Note: The S stands for Study.

Unit #	Bed/Bath	SQFT	Last Asking	Sale Price	% Discount	$/sqft
902	2/2	1068	$679,900	$335,000	51%	$314
1002	2/2	1068	$699,900	$365,000	48%	$342
626	2/2	1212	$829,900	$394,000	53%	$325
632	2/2	1212	$839,900	$391,000	53%	$323
1006	2/2	1168	$695,900	$367,000	47%	$314
906	2/2	1168	$639,900	$348,000	46%	$298
806	2/2	1168	$644,900	$353,000	45%	$302
948	2/2	1236	$649,900	$411,000	37%	$333
848	2/2	1236	$624,900	$402,000	36%	$325
748	2/2	1236	$599,900	$385,000	36%	$311
943	2/2	1310	$839,900	$413,000	51%	$315
843	2/2	1310	$819,900	$417,000	49%	$318
722	2/2	1330	$614,900	$380,000	38%	$286
622	2/2	1330	$698,900	$388,000	44%	$292
701	2/2	1167	$649,900	$333,000	49%	$285
601	2/2	1167	$634,900	$335,000	47%	$287
926	2/2	1212	$645,900	$346,000	46%	$285
826	2/2	1212	$784,900	$347,000	56%	$286
932	2/2	1212	$659,900	$350,000	47%	$289
1004	1+S/2	1078	$734,900	$327,000	56%	$303
904	1+S/2	1078	$699,900	$315,000	55%	$292
704	1+S/2	1078	$739,900	$364,000	51%	$338
924	1+S/2	1041	$509,900	$312,000	39%	$300
824	1+S/2	1041	$604,900	$310,000	49%	$298
624	1+S/2	1041	$579,900	$308,000	47%	$296
1003	1/1.5	875	$509,900	$266,000	48%	$304
903	1/1.5	875	$489,900	$260,000	47%	$297
603	1/1.5	875	$449,900	$255,000	43%	$291
944	1/1.5	922	$559,900	$290,000	48%	$315
844	1/1.5	922	$534,900	$285,000	47%	$309
744	1/1.5	922	$514,900	$281,000	45%	$305
942	1/1.5	796	$504,900	$249,000	51%	$313
842	1/1.5	796	$479,900	$249,000	48%	$313
1013	3/2	1774	$1,114,900	$510,000	54%	$287
913	3/2	1774	$1,114,900	$501,000	55%	$282
813	3/2	1774	$1,114,900	$489,000	56%	$276
1205	3/3	2110	$1,684,900	$626,000	63%	$297
1105	3/3	2210	$1,584,900	$604,000	62%	$273
1209	3/3	2056	$1,599,900	$570,000	64%	$277
1204	2/2.5	1596	$1,284,900	$470,000	63%	$294
923	2+S/2	1495	$949,900	$399,000	58%	$267
927	2+S/2	1591	$984,900	$447,000	55%	$281
929	2+S/2	1495	$964,900	$395,000	59%	$264

What will the natick mall condos sell for at auction?

9/17/2009

As you probably heard, 42 units at the Natick Mall(Nouvelle) condos are going to auction. Why are they only auctioning off 42 out of the 200+ units? There are two simple reasons.

1. Mostly importantly, the purpose of the auction is to generate a lot of interest in this condo project. They will use the auction units to bait potential buyers into seeing these condos and hopefully buy a unit in the future at market value.

2. Second, it’s to determine the market value of these condos. They want to figure out what buyers are willing to pay for these units. Once the auction determines the market value, they will price the remainder of the units accordingly based on the results of the auction.

So what will these properties sell for at auction? My analysis is as follows:

1 bedroom 1.5 bath 800-900sqft units will sell for $240k-$260k
1 bedroom + study 2 bath ~1050sqft units will sell for $300k-$330k
2 bedroom 2 bath 1100sqft -1300sqft units will sell for $360k-$400k
2 bedroom + study, 2 bath 1500sqft-1600sqft will sell for $420k-$450k
3 bedroom 2 bath 1800 sqft will sell for $470k-$500k
3 bedroom 3 bath 2100sqft penthouse will sell for $600k-$700k

Are you sure you want to be a Realtor?

This post was inspired by the fact that too many new real estate agents are coming into the real estate business thinking it's easy and they don't know what they are getting into. We find that they fail miserably 6 months later because they didn't know it would be this difficult. For all those thinking of getting into real estate, please read this first.

Are you thinking of getting into the residential real estate sales business? This article describes what it takes to have a successful career as a real estate salesperson. Do you want to know the truth about being in the real estate business? If so, read on…

First, let’s define a successful real estate agent. A successful real estate agent sells 15+ homes a year and makes over $100,000 in gross commissions. A successful agent is motivated to succeed, wants to make a lot of money, and will do whatever it takes to achieve his goals. This article only applies to individuals who want become a successful real estate salesperson. Do you want to be successful? Those who only want to make $30k-$50k can stop reading.

Who else can stop reading? If you are getting into real estate because you want to make your own hours, work from home, and not follow a specific work schedule, you can stop reading. This business is not for you.

If you are getting into real estate to be your own boss and not have anyone tell you want to do, this business is not for you.

If you are getting into business for yourself because you think it’s easy and you don’t have to work hard. This business is not for you.

If you plan on sitting around and wait for your company to hand you leads, this business is not for you.

So what does it take to be a great real estate agent and run a successful business? What are the best agents in the country doing to succeed? First and foremost, a successful agent sticks to a strict schedule. Here’s an example:

Morning(required)

Arrive at the office between 7am and 7:30am.
Practice and role-play scripts and presentations for 30 minutes to an hour.
Prospect/Lead Generate 2-4 hours each day talking to at least 15-20 people.

Afternoon

Follow-up with leads and clients.
Go on a buyer or seller appointment every day.
Preview homes to learn inventory.
Get contracts signed, negotiate, and close.

A successful agent goes after new business constantly. A successful agent faces rejection day in and day out and still pushes forward looking for that new business. And most importantly, a successful agent does not wait for business, he seeks business. Are you motivated and disciplined enough to go after business?

Lastly, great real estate agents strive daily to improve their skills and expand their knowledge through education. They have somebody to hold them accountable to their business and will hire a coach/mentor to help grow and develop their business and improve their sales skills. If you want to be successful, you must have a coach. Are you willing to take that step?

If you answered “yes” to all of the questions above, you have a strong enough mindset to be successful in this business. Now, is the most important question… what are the startup costs?

Board and MLS Fees: $1,000/year
Office expenses: $100/month = $1,200/year
Signs and Business Cards: $200/year
Coaching and Training: $12,000/year
Personal Reserves: 6 months of living expenses

These reserves and startup costs will help you comfortably adjust to your new career. The less reserve you have, the more pressure you will feel to succeed, which can actually be a great motivating factor to help you achieve your goals.

Now that you have a good overview of what is required to be successful in the real estate business, are you still interested in becoming a real estate agent? If so, let’s get you started.