West Essex Neighborhoods and Homes

From the
Coldwell Banker Residential Brokerage
Market Watch Newsletter...

Two months ago, 60% of homebuyers were first-time buyers. Last month, 60% were repeat buyers showing that more homeowners are moving up. As the first-time buyers with the $8,000 tax credit incentive bought the starter homes, more sellers could move up to a new, larger home. Today's environment with lower prices is the perfect model for "moving up".

Selling High and Buying Higher

The fast moving days of 2004-2005 actually were not the best time for buyers. There was a sharp increase in home prices and although there was low inventory giving rise to those increases, a significant number of homes were sold. Sellers were selling high and buying higher as prices spiked up.

We know that this is a great market for first time home buyers, but...

Is this a move-up market?

You bet it is and here's why. If a homeowner wants to move from a townhouse or condo to a larger home, many are concerned their current home is not at the value it was a few years ago. Because all properties in the area have depreciated by the same percentage, there is a monetary advantage in moving up now. Assume a home was valued at $250,000 and then depreciated by 20%, leaving a current value of $200,000. A previously valued $500,000 home at 20% less is now $400,000. A homeowner would sell their home for $50,000 less than its high value, but could buy the larger home for $100,000 less, giving that homeowner a $50,000 positive increase.

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Ten years ago my wife, Linda, and I decided to do a major remodeling job on our home. We added more square feet of living space and moved the kitchen and one of the baths.  It was a big job.  The result of our efforts and investment was...and remains...the best thing we ever did.  So, what does this have to do with buying a first home or any other home, you ask?  It has to do with the clues one can look for to help in assessing the quality of a house and your potential home. 

As you probably know, building code officials need to approve the remodeling work that is done on a house including the framing, electrical and plumbing systems, fire alarm systems, etc.  With the help of our general contractor we selected subcontractors who were well known for the quality of their work.  In fact, it was common for inspectors to say things like, "This is Bob Stavella's work, isn't it?"  In other words, Bob Stavella had earned a reputation for doing outstanding electrical work, which not only made electrical inspections go more smoothly, it gave Linda and me a warm and fuzzy feeling knowing that we hired the best. 

Okay, you are out house hunting.  You step into a house for the first time and it's spotless.  It is very clear from what you see that the people who live there possess a deep affection for the house.  Then you descend into the basement and your eyes are drawn to the heating and plumbing system.  You are blown away.  Even if you don't know a whit about heating and plumbing you know you are viewing the work of a master.  In fact, if the house is in my neighborhood, you might be looking at the work of a master plumber and friend named Don Dowling, owner of Don Dowling Plumbing and Heating.  Here are some images that tell Don's story a lot better than I could. 

Pretty good, huh?  Could you confidently buy this house assuming it had the other things you were looking for?  You bet, you could and the reason is that quality in a home is viral.  It tends to spread from one system to another and from one room and floor to another.  Now, the chances are that you won't see too much work that looks like Don Dowling's, but you should be on the lookout for clues that signal quality even if it doesn't rise to the level of art. 

But, alas, many houses you will see in your search...especially a search for a first home...will have some glaring deficiencies.  Even if the house has been well cared for, the baths need redoing, the kitchen looks like it's out of a 50's sitcom, and the boiler prompts a quick look for a coal chute.  These are deals, but they are not necessarily big deals.  The key is to know what you are getting into and that's where I can help.  As a former developer and rehab contractor I have seen it all and have transformed some pretty ghastly structures into some very good homes.  I'll use that experience to help you navigate around some big deal issues that you probably don't want to tackle.  Your home inspection service (using one is an absolute must) will do the rest. 

So, you see a bunch of houses and finally buy one that you really love at a price that you love even more, because it needs some work.  Now what?  My recommendation is to hire the best contractors that you can, because it will be their work that potential buyers will see when you are ready to move to your second dream house. 

By the way, you can reach Don Dowling at (973) 228-7400.  He does wonderful work in my neighborhood.  Tell him McCabe sent you.

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If you use wire transfers from time to time as I do, getting an email stating something like this is not completely unlikely:

"The money transfer you have sent on the 20th of April was not collected by the recipient. Due to the Western Union regulation the transfers which are not collected in 30 business days are to be returned to sender. To collect cash you need to print the invoice attached to this mail and visit the nearest Western Union branch."

I have learned never to open a document from an unknown source so I did not "print the invoice attached".  Had I done so, here is what would have happened according to http://fraudo.com/2009/05/21/western-union-uncollected-money/:

"The email has an attachment that is supposed to be an invoice. Instead the attachment infects your PC with a virus that waits for you to use internet banking then steals your password."

So, beware!

Brian