paulbalzotti's Q&A

What I wrote about shortsale is totally accurate based on my experiences representing both buyers and sellers on succesful shortsales. I am not advocating for shortsales at all. With most buyers, I recommend they avoid them completely. You can wait for months and then the lender can counter your offer or not accept it completely, and the whole thing is not fun. All I was doing was explaining why the listing agents lower the list price below market value. The seller is often times faced with foreclosure, and it is simply the only way to get a qualified buyer to be motivated to wait it out and purchase it. Many of these can be nightmares, but many others close successfully, with the buyers getitng a great deal, and the sellers avoiding foreclosure.

It is definitely a tactic to get maximum interest in the house and get a good offer in place that the sellers can take to their lender. Sellers need to price slighly below market when it is a shortsale, in order to get a qualified buyer to be motivated enough to wait for a shortsale to (hopefully) go through. If it is priced the same as the comparables, nobody would consider it.That is the main reason why you can't compare a sold short sale to a typical sale. The price usually closes atleast 10% below market value, because that is what a buyer will discount in order to be willing to wait the 3-6 months for a sale to approve. Often times, the buyers is also buying "as is" and stuck paying utilities for the distressed sellers that are usually in pre-foreclosure.  

That was a terrible inspector and not typical of what they do. Buyers are much more likely to miss things and have the experience you had when they use just the contractor friend.  I would advice a buyer to always pay for an inspection, and then have the trusted contractor friend or family member come out to the inspection for an extra set of eyes and another perspective.Inspectors are not perfect and can miss things, but they are the only ones with the tools and the training to give you a full report of everything that needs to be done. A good inspector will also provide proper perspective on the issues. They can explain if an issue is typical wear and tear, if it's defective, and/or if' it's a safety issue. They also are up to current code and are trained to refer you to a specialist when it's beyond the scope of their expertise. Bottom line is you don't want someone your friends with just wondering around pointing at things that are wrong. It is too big of a purchase to go about it that way and take that risk. A good inspector will always more than pay for themselves.

Kimberly, you have indicated that you want to write an offer now, so to me that ssumes you have already seen it when it was listed. Is that the case? If so, you should ask the seller is if they signed a standard NWMLS listing agreement when it was listed. The default language in the NWMLS listing agreement says that seller is to pay the commission "to any person whose attention it was brought, through the signs, advertising, or other action of Broker, or any information secured directly or indirectly from or through Broker during the term of this agreement".I'm certainly not an attorney, and I'm not sure if this language even pertains to how you saw it..But you should find out if the seller signed that standard listing agreement before moving forward. I am not advocating that the listing agent needs to get paid, but if I were you, I just would not assume the seller knows for sure. It could become a mess if the listing broker finds out during or after the fact. Again, good luck :-)

If you found the property from the advertising of the listing agent, and it was just 30 days earlier listed, the listing agent will likely be entitled to a commission from the seller if you write an offer. It's up to you who you contact, but it's important to be aware of this. The seller might offer you a lower price not accounting for paying the listing agent, and then end up in a dispute with the listing broker....so for all of these reasons and more, I would get your own agent in touch with the seller or past listing agent and make sure everything is done the right way. Good luck!

Your partner will be able to buy and qualify for the $8,000 tax credit. He needs to be on the loan for the new purchase, and then you would probably need to wait an then add your name to the title. If you need to co-sign on the loan, and your both moving into this house, he may only be able to claim $4,000.If you go on www.IRS.gov and search for the form 5405, that explains how he can claim the tax credit afer the purchase. You really need to refer to the 5405, and have him talk to his tax advisor.Good luck!

Write your offer subject to inspection, and then hire a professional inspector. If the foundation, wiring, siding and more is all bad, then maybe a tear down is possible, but most don't tear a house completely down, and try to work with the structure f it is sound.. Deciding whether to tear it down, or just rip it down to the studs or just remodel the finishes....this all depends on the house, your budget, and your objective. If you are a bit more specific about the house and the objective, I'd be happy to give you my input. Good luck :-)

"Expect that prices will remain depressed for at least a generation"."A dropping asset has never made anybody rich so I tend to think it should be avoided instead of embraced"I understand why most believe the market correction has a ways to go, and it is yet to be determined what will happen with Real Estate values in Washington over the next few years., I wish this debate could stay respectful, but even though I invest in Real Estate and spend most of my day watching real-time sales activity, apparently being a full time Realtor who is active in the market...ironically makes my opinion less valuable to some, and also makes me the same as every Realtor everyone has ever talked to or worked with.I am not going to keep responding to a host of people trying their best to pick apart every reason to consider buying in today's "buyers" market..I think there is opportunities out there for first time home buyers investing for the long term, but clearly, most on this forum disagree and think the best bet is to keep renting for a long time.Mike will probably never buy a house if he listens to most of these post, and  I will respectfully retire from this Q&A with this...When real estate trends change, most people have been looking the wrong way at the wrong things and never see it coming. At market cycle peaks, for example, they see profits quickly erode away because they hold on to overpriced properties for much too long, with the expectation that prices will keep going up. And then years later, at market cycle bottoms, these same people miss out on bargains because they are convinced that prices will continue to fall. Even today, between 50 to 75 percent of the average American's net worth is store-housed in the home they live in or investment Real Estate!

You are right if you lose your job, your in a bad spot. I would not suggest buying a house if you have a decent chance of being unemployed in the near future. I have a buyer who backed out of his home search because his plant is doing layoffs, and that makes an enormous amount of sense. Prices have came down this winter, and many overpriced listings have came down a ton....but the houses my buyers have purchased are not losing $$ before closing. Most of the sellers are coming down, and most appraisal are coming in above the purchase prices buyers are getting. And that is with new appraisal standards that requires very conservative analysis and only recent solds.Finally, I am not losing money on my rental if I am not selling! Today's prices are only relevant if you are selling today. If I sell in 20 years, the price may go down, up, down, and back up again, Meanwhile, I am having renters pay down my mortgage and expecting the value to atleast go up slowly, on the least with inflation.Do you only buy when value's are going up? That means you have to have seen values going up for some period before you jumped in and purchased. It's impossible to time these things perfectly. Again it's cyclacel market, and should be a long term investmentThe supply of housing in Seattle dropped from 10 months all winter long, down to an 8 month in early April. An 8 month supply of housing is slightly above average, but not bad, When supply is less than 6 months, prices are usually going up, and when supply is more than 9 months, prices are usually dropping. In Arizona, where my Dad's a broker, inventory was as high as 28 months at one point last year. The Seattle market did take a beating this last year, but I believe we at or atleast near the bottom in most prime locations in our area.  

It's called claiming depreciation on a depreciation schedule.And my rent is covering my mortgage payment, so I am not losing any money. As I mentioned, I plan to keep the condo long term.I don't really want to get in too much detail about my taxes or anyone elses. I am not a tax expert, but I know this is really a common deduction that many investors use with rental properties.