Archive for September, 2009

Short Sales at Artificial Prices Hurt the East Boston Market

Two recent property sales in East Boston exemplify how short sales can contribute to a neighborhood’s plummeting property values. Recently, two of East Boston’s largest and finest triple-deckers were put up for sale and sold for about $100,000 less than market value in less than a week, without giving potential buyers an opportunity to bid or pay true market value for these properties. In both cases, the real estate agents listed and sold the properties quickly to their own buyers and then proceeded to negotiate with their sellers’ banks in order to have sale prices accepted and the sellers relieved of mortgage debt.

61 Homer Street is a large three-family with four parking spaces. It was listed on May 14 for $400,000; an offer was accepted on May 15. It sold on September 21 for $315,000. The City of Boston’s assessed value was $412,600. It could have sold on the open market for about $425,000. Similarly, 127 Princeton Street, a large three-family, was listed on August 21 for $499,000. It had an accepted offer on August 24. It sold on September 14 for $258,000. The City of Boston’s assessed value was $346,400. It could have sold on the open market for about $350,000.

By accepting artificially low sales prices of $315,000 and $258,000, lenders on these properties allowed sellers to walk away from debts and allowed real estate agents to limit sales to their own buyers and earn larger commissions than they otherwise would have. Meanwhile, neighborhood values were hurt. If lenders had required these properties to stay on the market for at least one to two weeks at somewhere near their market or assessed values, these properties could have sold for more money, creating documented sales at higher prices. It would then be easier for other buyers to obtain fair appraisals of properties purchased from “regular sellers” and easier for homeowners who are looking to refinance, the opportunity to obtain decent and fair appraisals on their properties. The sale of two of the neighborhood’s largest and finest triple-deckers at artificially low prices will have a lasting negative impact on homeowners throughout East Boston. While two homeowners might have been relieved of their debts, the neighborhood is paying the price.

Please check back as we continue to update you on East Boston real estate happenings.  To see all our listings, or to search MLS properties, head to the Tony’s Realty Website.

Email Tony with your questions or comments.

.

Advertisements

East Boston Bank-Owned Properties Quickly Sell Above Asking

While the East Boston summer real estate season has been filled with many traditional sales—non short sales and non bank-owned sales—there is still a lot of attention paid to bank-owned three-family properties in the neighborhood. In the last two months, 3 bank-owned triple-deckers were sold; another 4 are under agreement. These properties usually sell very quickly, in less than 2 weeks, and almost always sell above asking price. Buyers interested in bank-owned properties should be aware of current market conditions. If a property is determined to be well priced or even priced below current market value, buyers will usually have to pay above asking price in order to have their offer accepted—otherwise, someone will have snagged the property from underneath them.

A few examples: A 2,946 square foot three-family at 72 West Eagle Street was listed at $159,800; it sold for $170,000. A 2,529 square foot three-family at 345 Meridian Street was listed at $185,900; it sold for $200,000. A 2,160 square foot three-family at 200 Lexington Street was listed at $191,900; it sold for $192,000.

Not only do bank-owned properties usually sell at asking price or above, they go “under agreement” relatively quickly, usually in less than one or two weeks. The following properties are under agreement but have not yet closed: 179 London Street (3,108 square feet) was listed at $235,000; it had an accepted offer in 7 days. 42 Gove Street (1,995 square feet) was listed at $166,900; it had an accepted offer in 9 days. 204 Bennington Street (1,989 square feet) was listed at $175,000; it had an accepted offer in 5 days. And, 319 Saratoga Street (2,103 square feet) was listed at $200,000; it had an accepted offer in 8 days.

Please check back as we continue to update you on East Boston real estate happenings.  To see all our listings, or to search MLS properties, head to the Tony’s Realty Website.

Email Tony with your questions or comments.

.

Tony’s Realty in the News

See this September 20, 2009 Boston Globe Magazine article where Tony’s Realty agents are quoted regarding the topic preparing a home for sale:  10 Steps to Take Before You Sell

 

East Boston Attracts a Diverse Range of Buyers

A question buyers and sellers often ask of Tony’s Realty is “who is buying real estate in East Boston?” Based upon observations of Tony’s Realty agents, the answer oftentimes depends upon the type of property being purchased. Most condos in East Boston are purchased by professional first time homebuyers, most of whom have maybe 3% to 10% available for a down payment. Many bank owned condominiums, most of which are in buildings with no associations, are sold to investors who pay cash. These are primarily used as investment properties and rented out. Sometimes, if a condo association is established and a high owner occupancy rate can be achieved in a building, investor purchased bank owned condos can be resold for a profit, again with most buyers being younger professionals.

Larger multi-family properties in East Boston, especially those with apartments having two or three bedrooms, are almost exclusively sold to immigrant families currently living in East Boston as tenants. These usually become owner occupied properties. Smaller, bank owned multifamily properties are usually sold to investors, often paying cash, who use the properties as rental buildings.

Single-family homes attract both younger professionals as well as immigrant families. Occasionally, native East Bostonians or city employees such as firemen or policemen will purchase Orient Heights properties. Unlike condos, which sell almost exclusively to younger professionals or two or three family homes, which sell almost exclusively to immigrant families, single-family homes attract buyers from both of East Boston’s two major pools of buyers.

Please check back as we continue to update you on East Boston real estate happenings.  To see all our listings, or to search MLS properties, head to the Tony’s Realty Website.

Email Tony with your questions or comments.

.

Fall Home Prepping Reaps Benefits for Spring Sales

The East Boston real estate market was very busy between May 1 and mid August. While the market generally slows down as summer ends, we predict a busy 8 weeks beginning after Labor Day and ending around Halloween. The subsequent months, November thru March, should be relatively slow. With shorter days, and wet and cold weather, enthusiasm for moving usually starts to dwindle.

If you are thinking of selling within the next six to nine months, but are not prepared to sell during the remaining 8 busy weeks of the season, it is best to spend the subsequent November thru March months preparing your property as best as possible for a spring market. Service or replace old furnaces, de-clutter and simplify each room, empty attics or basements, fix broken window panes or screens, grout bathrooms, install GFI outlets in kitchens and bathrooms, remove any asbestos, refinish hardwood floors, clean or replace carpets, paint walls and ceilings, fix leaky roofs, and obtain certificates of lead paint compliance for rental units. Spending between $1,000 to $10,000 during the late fall and winter months to make a property more presentable will enable a faster sale and a higher price during the busier April thru October selling months.

Please check back as we continue to update you on East Boston real estate happenings.  To see all our listings, or to search MLS properties, head to the Tony’s Realty Website.

Email Tony with your questions or comments.

 .