In a sellers' market: 3 ways for buyers to win a bidding war

Barely 12 months ago, buyers could confidently peruse piles of listing sheets before making a lowball offer and getting a nice discount off the list price.
Not anymore. Last month, there were about 44% fewer homes on the market in Chicago than in February of last year, according to Midwest Real Estate Data. The city had only a 3.8-month supply of housing units, compared to an 8.9-month supply a year ago.
Surprise: it's a seller's market. And that means many homebuyers are likely to find themselves in a bidding war.
I've seen it more than a few times over the last year. You hunt and you search and you think you've found a winner. You and your agent pour over comps and market stats. You figure out what the seller paid for the home and what they owe on it. Your agent grills the listing agent to find seller hot buttons. You construct the perfect negotiation strategy, and submit your offer, ready to get the deal of a lifetime.
Then you get the call, and hear the crushing news that more buyers are hearing these days: "We have received multiple offers. Please submit your highest and best offer by tomorrow at 5 p.m."
So now what? A good listing agent won't tell you much about the other offer. It could be $20,000 less than yours or $20,000 higher. There could be one other offer or four. You're going to have to put your best foot forward. Here are three tips to help you fight for your new home and win:

#1 Remember: It's not all about money
Sometimes it is about timing. Pick a closing date advantageous to the sellers. Can you close quickly, saving the sellers money? Or can you close later, giving them time to find a new home? Find out what matters to them.
Have your agent select a brief (five days or less) attorney review and inspection period. This will minimize the amount of market time a seller could potentially lose if you were to back out of the contract as a result of something found during the inspection. It will also give the seller more time to confidently search for a new home.
Important: This requires you to have your act together. Who's your inspector? Who's your attorney? Call both of them before you put the contract in so you still have time to do your due diligence. Finally, make a large earnest money deposit - say 5 to 10 percent of price - to show the sellers you're serious. They know a buyer with some skin in the game is less likely to jerk them around and then bail on a contract.

#2 Make the seller like you
An offer with a well-written cover letter stands out, and it never hurts to try to relate to a seller. Are you newlyweds buying your first condo? Are the sellers moving out because they just had their first child and need more space?
Great. Play up the nostalgia. Have your agent tell the sellers a bit about yourself and why you like their property. When evaluating multiple offers as a listing agent, I find this is a nice touch. Agents often fire off contracts with no cover letter and little presentation. This gives the impression that their clients aren't as committed to buying the property, and I'm likely to convey that to a seller.
Then, go back to #1 and make sure your agent emphasizes those points in the cover letter. Tell them what you do for a living and how thoroughly your lender has pre-qualified you (Tip: get thoroughly pre-qualified). Sellers should get the impression that you are a buyer with no potential financing issues who is committed to buying their property.

#3 Pay what the property is worth to you
This one should go without saying, but sometimes buyers get caught up in the emotions of the process. Overpaying for a property isn't winning, and neither is stubbornly sticking to a lowball offer.
Have your agent put together a detailed comparative market analysis to determine the fair market value of the property. From there, as I always say: "add love, subtract fear." It's okay to pay a touch more if you really love the place, especially if you've been looking for awhile. But keep in mind, the property will need to appraise for this price if you're getting financing. And it's okay to bid a bit less if you feel you have other strong options.
I took a buyer to see three condos that each had been on the market for three months. That was a Thursday. My buyer left for the weekend to go skiing. When he came home, all three had offers in on them, and two of them had multiple offers. That's the residential housing market in Chicago right now.
My final word of advice: "buyer be ready." Get all your homework done before you make that offer. If you want to survive in this sellers' market, you have to be ready.

Site of former department store in Beverly Hills on market again

One of the most desirable pieces of real estate in the country — the site of a former department store in Beverly Hills — is on the market again.

Unlike other commercial properties across Southern California that have seen major long-stalled developments finally get underway in the last few years, this one has been a struggle. Once home to an upscale Robinsons-May store, the property has seen multiple owners who have so far been unable to bring a condominium complex designed by a famous architect to life.
Fortunes have been won and lost in the process, however, and vast sums are again on the line.
Joint Treasure International, a Hong Kong private equity firm, bought the 8-acre parcel near the intersection of Wilshire and Santa Monica boulevards in 2010 for $148 million. The firm had said it would complete an existing plan to build 235 condos on the property at 9900 Wilshire Blvd.
The 62-year-old building, which stands across Merv Griffin Way from the Beverly Hilton Hotel, has been unoccupied for nearly a decade. In a separate development, the owner of the hotel announced this month that he will start work soon on a Waldorf Astoria hotel that will rise next to the Hilton.
Representatives of Joint Treasure could not be reached to explain why they want to sell the Robinsons-May property or how much they hope to get for it. Real estate experts familiar with the Beverly Hills market think that the property is worth more than twice what Joint Treasure paid for it, perhaps in the mid-$300-million range.
Developers have found it challenging in recent years to find lenders willing to fund condo projects. Even though the housing market has been recovering, condo prices are still a bit low to justify new construction in most neighborhoods.
Beverly Hills, with its international cachet, is different, real estate broker Laurie Lustig-Bower said. "We are severely under-supplied for high-end condos in Beverly Hills," she said. Condos in the nearby Montage have sold for more than $10 million.
Lustig-Bower's international property brokerage, CBRE Group Inc., is marketing the property with Savills, a London real estate services firm.
"We think there is a high probability the new owner will be from overseas," Lustig-Bower said. Investors from Europe, the Middle East and especially Asia are likely buyers, she said.
The top selling point of the property is that previous owners successfully navigated Beverly Hills' arduous city planning process and secured approvals to build a condo complex designed by Richard Meier, architect of the Getty Center.
"Upon transfer of ownership, the incoming buyer will leverage the value already created and be able to immediately commence construction — a truly rare circumstance in the highly regulated and supply-constrained city of Beverly Hills," the selling brokers said in a statement.
Meier's design includes underground parking for 876 cars and nearly 21,000 square feet of shops and restaurants.
Condominiums at 9900 Wilshire could be sold to buyers from around the world, many of whom would probably have residences in other cities as well.
"I think we'll see a lot of local interest too," Lustig-Bower said.
Joint Treasure bought the property in 2010 in a private auction from Banco Inbursa, a bank controlled by Mexican billionaire Carlos Slim. The bank took possession of the property that year after completing foreclosure proceedings against CPC Group, which was operated by jet-setting British developers Nicholas and Christian Candy.
The Candys made headlines in 2007 when they bought the parcel for $500 million in one of the largest transactions in the history of Los Angeles County. The seller, New Pacific Realty Corp. in Beverly Hills, paid $33.5 million for the property three years earlier.
New Pacific created the plan that called for razing the empty department store and building a $500-million, ultra-luxury condominium and retail complex designed by Meier. Joint Treasure said it would follow through with the same basic plan but never started construction.
Beverly Hills is experiencing a surge in investment, said real estate broker Jay Luchs of Newmark Grubb Knight Frank. Rodeo Drive is fully leased for the first time in years, and nearby Beverly Drive is attracting more top-end national and international fashion retailers.
"Owners of these companies want to buy houses here," he said "Their CEOs and important people want to be here."
The growing commercial property demand has helped raise residential prices, Luchs said.
"Everything changed over last five or seven years — $5 million is nothing now," he said. "The best homes are $15 million to $20 million or more."

7 Ways to Make Your Home More Appealing to Buyers

When you're ready to sell your house, it pays to assess your home and make improvements before the for-sale sign goes in the yard. By doing so, you'll help buyers see the beauty of your home -- and that helps put the sold sign up faster. Especially in today's tough market for home sellers, attention to details and a willingness to go the extra mile can make all the difference.
 Here is a list of tips to make your home stand out from the rest.



Be objective
                                            

One of the hardest things for homeowners is to see their house from a buyer's perspective. If you can't be objective about how your home looks, take pictures of it. Take photos from the street, the kitchen, living room and master bedroom. These are the rooms that matter most to buyers.

 

Start at the front

                       

Give the front of your home a makeover. Hire a landscape company to freshen the grounds, trim shrubs and trees, and add mulching. Repaint the mailbox, add new house numbers and hide trashcans. These improvements help hook buyers at the curb, enticing them to view your home.

 

Add Life

 

Invest in good quality real or silk plants. Spindly plants are eyesores. Look in any d¿¿cor magazine and you'll notice how plants are placed attractively in the room. Use these as guides on what plants to buy and where to place.

 

Put Money Into Your Kitchen

 

Investing in the kitchen is one of the best returns on investment for homeowners. The kitchen is the one room that really excites buyers, so make it work for you by adding a new backsplash, fresh coat of paint on the cabinets and trendy pulls. Dated lighting, peeling laminate and crowded countertops will have buyers backing out of the house.

 

 

Set The Table

 

Model homes and homes in design magazines always feature a dining room table that's set, but few homeowners with homes for sale set the formal dining room table. Setting the table makes the room inviting and helps buyers imagine themselves in it.

 

Open The Door To Sales

 

The front door is the first place on your home a prospective buyer sees and touches when they arrive. Repainting or revarnishing the door and polishing up the hardware will create a vision of beauty and buyer anticipation because it says the house is cared for right up front.

 

Create A Focal Point In Every Room

 

Each room should have a feature that defines the space. A focal point helps visually draw buyers into the room -- and where the eyes go, the heart often follows. Using the photos you've taken earlier, plan a focal point for the main rooms of the house, including the kitchen.

 

 

The Top 5 Ways to Boost your Credit Score

Don't let your less-than-stellar credit score get you down. Instead, check out these 5 crucial steps to raise your score:

1. Monitor your credit. You can't boost your credit score if you don't even know what it is, much less why. In order to make improvements, you need to know your credit scores and learn more about your credit history and the accounts that affect it. The top credit monitoring services not only provide you with your 3-bureau credit report and scores for free, but they also monitor your credit daily and alert you of any changes. This will help you get educated about your credit and protect you from identity fraud, which can be detrimental to your score. On top of providing you with your personal credit information, many of these services, like Identity Guard, for example, offer personalized "what-if simulators" that will estimate how your credit scores might improve if you took various actions. Not only that, but they explain how certain items in your credit history have positively or negatively affected your score.
Services we recommend include Identity Guard, which monitors your credit daily, updates your credit score every 3 months and comes with a complimentary subscription to Zone Alarm Internet Security Suite, and FreeScoresAndMore.com, which includes all of the same perks plus updates your report and scores every month. Read full reviews of our top picks for credit report monitoring here.
Want to give it a try? Get your 3-bureau credit scores for free by signing up for a free trial.

2. Fix any errors on your credit report. Once you start looking at your credit reports, there is a possibility that you may find an error. In fact, almost 52 million Americans had errors on their credit reports in 2012, according to the FTC. These errors may be simple office mistakes or worse, identity fraud. No matter what the cause of the error is, it could be lowering your credit score. Credit monitoring services like Identity Guard, FreeScoresAndMore.com and TrustedID have helpful resources that can help you file disputes to the credit bureaus, plus they have knowledgable customer support that can help you to boot.
In order to fix any credit report errors, you need to contact the particular credit bureau in which the error was found. To do this, you must first review all three of your credit reports — Equifax, Experian and Transunion. As discussed above, the easiest way to get your credit reports is to sign up for credit monitoring.
If you only wish to look at your credit report to find any errors, you should note that every consumer is entitled to a free credit report each year from annualcreditreport.com. The reason why we recommend signing up for an ongoing credit report monitoring service, however, is because annualcreditreport.com does not provide you with credit scores, it does not help explain your credit scores and because you can only get the report once a year, you will not get the benefit of monitoring, which will help alert you to any changes and in turn, any errors.

3. Minimize your Credit Utilization Ratio. In order to fix your credit score, it is important to know specific variables that affect it. On top of fixing credit report errors and making timely payments on your loans (which I will discuss below), considering your Credit Utilization Ratio is a key element in boosting  your score. The ratio is calculated like this:

A higher credit utilization ratio affects your credit score negatively because it shows that you are using more of your credit limit. In other words, it is good to have a large amount of credit available, but bad to be using a large fraction of it.
To combat a high credit utilization ratio:
- Try not using your loans and/or credit cards to their limit.
- Do not close old credit cards, even if you do not use them. The more credit you have available and not in use, the lower (better) your credit utilization ratio will be
- If you do not have enough available credit to lower your ratio, open a new credit card. Currently, there are a number of cards that offer 0% interest for the first 12 to 18 months, read up on these credit cards here.
Note that if you're thinking of signing up for a new credit card, make sure to only apply if you think you will be approved. This is because the credit inquiries that result  from applying for a credit card may lower your credit score slightly in the short term; however, if you are approved, the improvement in your credit utilization ratio will more than make up for the initial effect of applying for credit. Want to learn more about signing up? Visit our credit card FAQs page.

4. Stay on top of your balances and payments.

If you want to stay on top of your credit score, you need to stay on top of your credit accounts. Not making payments on time lowers your credit score significantly and causes you to pay finance charges. Sign onto your accounts online and make sure you know your balances and payment deadlines, in short — get organized. If you are currently in default on a credit account, it is definitely best to at least pay the minimum amount in order to get current. While a late payment history is definitely bad, currently late payments will destroy your score — pay on time!
If you're tired of paying off your credit card only to accrue more interest, try transferring your balance to a credit card with 0% interest. This way, you can make payments each month without worrying about interest payments. Check out these top balance transfer credit cards.
Signing up for credit report monitoring is a good way to view your credit reports, which lay out all of your past and current accounts in an organized way. This allows you to view all of your accounts and to catch any mistakes you may have made in the past that affected your score negatively.

5. Get a secured credit card. Having and using credit responsibly will raise your credit score, but if you are unable to get a regular, unsecured credit card because of a limited credit history or other credit issues, then a secured credit card, like the Capital One Secured Mastercard, that actually reports to the three bureaus is a great option for you. When you sign up for a secured card, you are required to provide cash collateral, which becomes your credit limit. You can then use this card as you would a regular credit card — making purchases and paying off your balance at deadline each month. For example, if you put a $300 deposit on the secured card, this is the amount you are allowed to spend.
By using a secured credit card and making payments on it  you are showing that you are responsible with credit. This will reflect well on your credit score, and if you maintain a positive payment history on the card, oftentimes the company may qualify you for an unsecured credit card. Again, you need to make sure that you sign up for a secured credit card that reports to the three credit bureaus.
 

 

How did home sellers handle multiple offers?

 

 

10 Hottest Fresh Architecture Trends in 2014

1.  Passive Homes

One of the most prevalent trends in the architectural world today is the shift towards a reduction in the consumption of energy; a reduction in carbon emissions, a focus on green principles. The passive home deals with this entire issue of wasted energy and carbon emissions, and it’s because of this solution which PassivHaus provides which has made them the center of focus and architectural design thus far in 2014.

As mentioned in one of our other articles, ‘Passive Houses: 13 Reasons Why the Future Will Be Dominated by this New Pioneering Trend‘, we show how a passive home can save up to 90% in heating costs.  As a large chunk of the world’s energy consumption is gobbled up by the home, if only this trend became accessible to every single person, the positive impact on the world would be significant.

We envisage, as the economic woes of the world start to lift, more and more governments will begin to offer PassivHaus grants and funding.  If this happens: This’ll be a trend which will have a very real impact in changing the world and our children’s future for the better.

Passive homes will be a strong trend in 2014; but mark our words that this trend will continue to swell year on year for the foreseeable future.

2.  Designing for Relaxation

It has been said that the living of today are exposed to more information in one day (content of the New York Times) than an average person in the 17th century is exposed to in their entire lifetime.  One could argue that the type of information a person of the 17th century was exposed to is of a different kind of information in which most of us today would be blind to; but let’s focus in on the principle of information overload.

The fact is that most people don’t know how to organize and process the sheer volumes of information they face everyday; what’s important and what isn’t; etc.  It’s for this very reason more and more people are turning an area of their home into a place of retreat; a place to relax and unwind.  The most popular choice in 2014 is the home spa; a place where one can escape to and unwind.  

The home spa industry is growing at a healthy rate.  In quarter four of 2013, it grew by 10% compared to the same quarter the previous year. The home spa industry is healthy and will continue to be a favorite in architectural design in 2014.

Further evidence of this trend can be demonstrated through new builds in the United States.  Over 50% of new builds are now equipped with a whirlpool bath.

3.  Flex Rooms

What are flex rooms?  Flex rooms are rooms or areas in the house which have a range of uses, or could be changed at some point during the year.  It’s usually a place in the house which is used for more than one purpose, for example an entrance hall also being used as a dining room.

Why is this a popular trend and why will it be strong in 2014?  The strength behind this trend can find its strength in three main factors; baby boomers, income and versatility.

Let’s start with baby boomers.  Architects are now designing homes to accommodate the growing elderly population who are opting to stay with family.  These houses have to be well organized, usually segregated from the rest of the house in some way in a self contained unit.  This allows for separation between the family (sanity preservation) and it also allows the living space to be rented out if need be.

Secondly, income.  As disposable income has dropped significantly and pensions lost in the crash of 2008, retirees have been forced to move in with their families as they simply can’t afford to live by themselves, or pay for a retirement home.

Thirdly, versatility.  Options are empowering and give the homeowner choices.  Flex rooms enable maximum usage with the space given; maximum usage output per square foot of living space – It also allows for change of use if so required.

 4.  Prefabricated Buildings

With the development of manufacturing technology, investment into the whole area of prefabrication (especially in China) has helped move this trend into significance.  Don’t just think homes either, this trend stretches far and wide, encompassing hotels, office buildings, sheds and end of garden builds.

The main draw of this trend are the monetary savings in which it offers.  The repetitive manufacturing process means savings in raw materials and saving in manpower.  Entire walls and furnished floor space are pre-made in a factory, which are then delivered direct to the plot, ready to be assembled in some giant Meccano like structure.

Project management is easier, build time is less, work force required is reduced; all money saving factors and all reasons why this is a growing trend which’ll continue to develop in 2014.

I think one of the most powerful visual examples of the power of prefabrication can be seen in this video where a 30 story building is built in 15 days.

5.  Health Conscious Designs

The materials which are used in building, decorating and furnishing the home are an issue which is being addressed by architects and designers.

Paints, upholstery, insulation, wood stain and other synthetic materials used in the home which cause hypoallergenic reactions and possible serious health problems are being replaced with those which don’t have such negative side effects.

Alternatives to these potentially unhealthy materials are always available, it’s just a matter of sourcing them at a price which clients are willing to pay.  It may be a matter of selling the potentially significant health benefits of these materials to help overcome the potential cost increase; the winning strategy to win their approval.  It’s just like the concept: If you have never had a heart attack, eat and live as though you have had one, to prevent (or at least reduce the risk) that problem from occurring.

In the same vein, architects are looking to cut down on the hypoallergenic and prospective carcinogenic materials, a trend which we’ll see in 2014.

6.  Kitchens: Hub of the Home

This is one which we particularly like; the kitchen being the focal point of the home.  No longer will the kitchen be that room which is built in the dark recesses of the house – Now it’s being elevated to center stage.  The kitchen is set to be the room in the house which is being used for more than just cooking.  We are seeing it being used as a place to think, study and work in addition to whole range of other multitasking uses.

It’s a similar dynamic to the flex home, but more specific.  Having the kitchen as the hive of activity within the house is great for bringing the family together and strengthening relationships.  It’s the trend for 2014 which should continue for years to come.

7.  Inventive Storage Capacity

You might have noticed while driving around the massive, often bold colored storage locker buildings; they’re everywhere.  It seems like this trend has grown like an out-of-control garden over the past 10 years, but there is a fundamental reason for it.  People have acquired so much ‘stuff’ they don’t know what to do with it, so much so that they are paying monthly payments to store their junk precious items in storage.

Without tackling the underlying problems that would be the job of psychiatry professionals; architects realize the need and are catering for it.  More storage space is obviously needed in the home, and they are designing varied solutions with style & finesse.  Clutter around the house can be unsightly, and in a world of design where less is more, clutter needs to be dealt with; even if it’s merely storing it.

Again, based on need, this trend is a growth trend which’ll be popular in 2014.

8.  Reusing Existing Buildings

Some of the best designs in 2014 won’t necessarily be newly built buildings on the cutting edge of architectural genius, but rather using the existing shells of buildings to build around.  Buildings which have a rustic industrial aura, church buildings, factories and buildings with historical character are all existing buildings or derelict shells have character features which are difficult to recreate in modern design.  It’s a wonderful endeavor that helps to save historical beauty, which is why we’re glad this is a growing trend in 2014.

9.  Utilizing the Outdoors

Where the outdoors was once a place exclusively for the garden or yard, it is now being used for outdoor rooms.  The advance of outdoor eco-friendly materials has enabled architects to become more creative with the use of outdoor areas.  Space is a valuable commodity, so it makes logical sense that this trend is growing; especially as population growth increases whilst house prices remain staunch.  The trend will be especially popular in areas where the weather is kind, but even in places such as the U.K. you’ll find brave and creative architects making it work.

10.  Disaster-Friendly Designs

It seems that nobody is safe from flooding, storms, fires and earthquakes these days.  Growing up in England I’ve always categorized these dangers as problems that other country’s have.Hurricanes: I think Florida.  Earthquakes I think Tektonic regions.  Floods I think of Tsunamis in tropical countries.  England this winter has experienced the worst flooding in 250 years, with flooded homes and damage costing an estimated $2 billion dollars.  Whatever the cause for the erratic conditions we are facing as a human race; it’s reach is far and wide, and it’s an issue for geographical areas which previously weren’t affected – These areas are now investing into solutions to protect against such natural disasters.

As such, architects are now future proofing their designs for natural disasters such as flooding, storms and the likes.  This is a trend which has been forced upon us by need, and it’s an important one for coming decade.

Los Angeles is the Biggest Anti-Sprawl Success Story in the US

Los Angeles is changing its identity. It's moving away from the car and the single-family house and toward transit and denser living. And now it's even getting dramatically less sprawly. According to a study from Smart Growth America that factored in density, land use mix, robustness of "activity centers" like downtowns, and street accessibility (length of blocks, etc.), the LA metro area is now the twenty-first least sprawly place in the US, and the seventh least sprawly among metropolitan areas with more than one million residents. (The study also reminds us that LA is the second densest place in the US overall, after New York.)

Los Angeles's staggering urban density, coupled with denser housing developments and the efforts to improve transit, all helped make LA the "biggest success story," according to one researcher quoted in The Atlantic Cities. "Los Angeles has actually densified very substantially," says that researcher, and the report specifically calls out the area for its anti-sprawl policies, including a push for light rail and transit-oriented development and giving out density bonuses, which let developers build more densely if they include affordable housing.

In the end, says one urban planner, the reduced sprawl is the result of the demands and tastes of the population, especially "young professionals and empty-nesters," as the LA Times puts it, who value walkability and are willing to pay for it. So people like living in less sprawly places, it turs out, and that of course means they're expensive: "the places that fared best on the sprawl index – which is topped by New York and San Francisco – also tend to have high housing costs."