Real Estate

The Dobbs Team has been in Forest Village for about 7 months.  When we moved in August, the first thing I noticed was that there was no grass for ME to mow.  We were so consumed with moving and getting set up, it seemed a blessing.  As fall approached, leaves were starting to drop; yet we left the rakes in the attic along with the typical allergic reaction to oak leaves.  As winter approached, I left the snow shovels in the attic, as I knew that the Forest Village Condo Association would take care of the streets and driveways if there were to be a significant snowfall event.  We had a little snow this week, but a push broom was adequate to get the area cleared.

So now, I am starting to get used to this lack of normal outdoor activity.  We still pull our own weeds and maintain our shrubbery, but it is not a big deal.  In Forest Village, the association maintains the horticulture in the very front.  The individual homeowner can add shrubbery on the side and front nearest the living quarters.  They are also responsible for maintaining what they planted.

Inside the house, we still maintain and make the normal improvements that we would in a normal single family residence. There is still the toilet to fix, carpet to clean, and walls to paint that we have been used to our whole life.

Is Patio Home living for you?  Feel free to contact Steve Dobbs at (502) 475-3312 to discuss the pros and cons of condo-style living versus living in a stand-alone house.

If interested, Forest Village Patio Homes will give an in depth description and show you Patio Homes for sale.

I can feel the housing economy is getting better and I wondered about luxury home sales in excess of 1 million dollars.  The Dobbs Team decided a little research was in order.

In 2011 there were 21 homes that sold in excess of a million dollars in the 5 county area of Greater Louisville.  Excluded were sales with excess farm acreage.  Only Jefferson and Oldham counties had properties that met these qualifications.  All homes were existing homes with the exception of one that was new construction.

The average asking price was $1.72 million and average sales price was $1.43 million with an 81.2% sale to list ratio.  Average days on market were 325 days.

The averages weren’t near as much fun as pulling out other data.  Six of these sales happened in 36 days or less; 4 happened in less than 2 days.  I think that this goes to show when you have a nice luxury property that is priced correctly, they still tend to move.  Of the 4 sales happening extremely quick, one was a distressed short sale luxury home.  Throwing it out of the equation, the 3 homes brought 99% of asking price.  I think that this adds further emphasis that luxury houses can also bring top dollar.

 In general, the longer the house was on the market, the lower the sales price ratio.  I looked at the ones that were on the market for over 300 days and found 9.  These brought 85% of asking price; which doesn’t seem too bad.  But wait, what about the sales price versus the original asking price?  This got ugly… Here I found a 59% sales price to initial asking price on these luxury homes.

If you have any questions or comments about the luxury home market, give Steve Dobbs a call at 502-475-3312.

One of the agents in our Louisville KY office had questions about repairs, additions, and other items and wanted to know if inspection stickers were needed.  The home in question had a recently built garage with a lot of outlets.  There was a new hot water in the house along with some other newer electrical items.  Her concern was that there were no inspection stickers and wondered if this was legal.  Her second question wondered if a plumber or electrician can inspect and then place an inspection sticker.  Her third question concerned the need for an inspection sticker.

The home in question was built in 1979 in Jeffersontown, KY and was bank owned.  Of course, it was to be purchased “as-is”.  There was no way to determine who had made the plumbing and electrical repairs / improvements in the past.

The Jeffersontown Code Enforcement informed her that there is no Kentucky or city requirement that a permit sticker has to be on the electrical box.  If there are any problems with the electrical box, an electrician can do the repairs. If the electrician is changing something major, he would pull a permit.  However, he would only be verifying the work that he had performed.  In order to verify everything, the electrician or plumber would need to remove the drywall and inspect all of the wiring and/or plumbing.  This could get pretty expensive.

Now the thoughts came to home insurance.  As calls went to the Kentucky Farm Bureau Insurance, she was informed that an inspection permit is not a requirement for obtaining home insurance.  They further stated that you cannot be denied a claim if there was a code violation.

All of this information was given to the home buyer to let him make the determination if he wanted to pursue this deal.

If you have any questions about this, feel free to contact us.

 If you are looking for a new home in the Louisville KY market, Steve Dobbs and The Dobbs Team stand ready to assist and give you the best service.

In Louisville, KY and the surrounding counties, we can have a problem with Radon in our houses.  The only way to know is to test. Homes with basements are not the only places that Radon can be found.  Radon can be found in homes with crawl spaces and in homes on a slab foundation.

The Louisville, KY area is in a belt of higher Radon levels.

 Consumers can ask for free Radon test kit from the state of Kentucky.  This site also has a lot of information including Radon myths.

Most home inspectors offer to test for Radon during their regular home inspection.  Normally, they will set up a meter for at least 48 hours.  The Radon meter will sample once an hour and give you a current reading as well as an average.  Some of the better Radon monitors have the ability to hook up to a computer and let you print out the average results as well as a graph.

This is a 48-hour graph of our house.

 Obviously, this house needs Radon Mitigation with an average of 12.4.

What if a Radon level of over 4 picocuries is discovered in your new home?  The EPA would recommend Radon mitigation by a professional.  Costs can vary widely, but $800-1,000 is a decent range of what a lot of systems are installed.  Converting a passive Radon system to an active system is the cheapest and mitigating a crawl space is the most expensive. 

A passive Radon System typically is a 3-inch pipe from the sump pump area through the roof of the house.  There will be a small flow of air through the pipe that occurs naturally.  Converting this to an active system would involve installing a fan in the pipe providing a constant movement of air and negative pressure under the concrete.

One of the most important things in Radon Mitigation is the retest.  How do you know if the radon is mitigated if you don’t test?  In the example given, the retest was 6.1 and not acceptable.  We were able to move the suction point and receive an acceptable reading.

We have a lot of information about Radon in KY on our website and have some PDF documents from the EPA as well as information from the state of Kentucky.  Feel free to contact The Dobbs Team if you have any questions about Radon or the Real Estate market in Louisville, KY.

There are several ways to look at this.

Home Buyers that are relocating do not have much of a choice.  For example, the Ford Motor Relocation has brought an influx of workers into the Metro Louisville area from all across the country.  Most of these workers will start work by February 6^th.  Knowing that it often takes 30-45 days to close on their new home purchase, the activity has been brisk as they know that time is of the essence.  Some of the new Ford workers have homes to sell first and will obtain temporary housing before making a home purchase here.  These relocation purchases will drag on for a while.

There are several other reasons that home buyers are looking in the winter.

• Their lease runs out in the winter time.  They don’t want to sign another 12-month rental agreement, so they are motivated by the end of lease terms.
• The buyers are current homeowners who are now under contract. They need a new home, now!!!
• People are always looking for a bargain.  The Foreclosure or Short Sale house may be just what they need for themselves, or to fix up and flip. 
• Along this same line, investors are looking for opportunities year around.
• People looking for their “Dream Home”.  They keep an eye out for a few key properties.  When this home hits the market, our “dreamers” don’t want it to slip away.
• A myriad of personal reasons.  At some point, they are just in the market and The Dobbs Team is there for them.

With all of our buyers, we tell them that the sellers are motivated.  If they were not motivated, homeowners would not have their house on the market in inclement weather. We know that the home buyers are motivated to be out bundled up for cold weather!

 If you have any questions about the Louisville KY home market, contact The Dobbs Team.

 I have conversations with my sellers in the Louisville KY area frequently.  At this time of year, the question comes up about whether to leave the house on the market during the winter months, or even to have the listing active during the holidays.

I think that it comes down to motivation. 

How motivated are Mr. and Mrs. Seller?  I feel sure that the buyers are serious if they are out in Louisville’s winter weather.

So, what is at stake?

• Inclement weather needs to be addressed.  If it snows, and it does snow in Louisville, the sidewalks need to be cleaned.  It is not a welcoming sight to the buyer’s eyes having to traipse through the snow to get to the front door.
• Speaking of snow or rain, there needs to be an absorbent welcome mat inside the front door.  If need be, booties could be provided to protect the carpet.
• The seller does not want to leave their cozy, warm fire; yet the buyers expect to have the house to themselves.  Sacrifices will have to be made.
• If the sellers truly want their home sold; it has to be shown.  Refusing showings just insures that it will be on the market even longer.
• There are fewer properties on the market reducing the competition.  Currently this amounts to 20% reduction from normal home inventory. For buyers that need to relocate or purchase immediately, this is a good thing for the sellers.

The Dobbs Team thinks that sellers need to rate themselves on a motivation scale from 1-10.  Is their home on the market to see what happens, or do they want to see it sold?  Contact The Dobbs Team in Louisville KY and let them give you more detail.

This morning I had discussion with a client moving from Minnesota with the Ford Relocation to Louisville KY.  She asked me about how well Patio Homes in our Louisville Market were moving.  I gave her some generalities over the phone and then decided to dig up a few numbers.

I know that closed home sales and new listings are up this year over last in the entire Louisville MLS.  But, has the absorption rate changed?  I used closed home sales in the August through October time frames for my calculations. 

In Jefferson County, we sold 1765 homes in this 3 month time frame for an average of 588 home sales per month.  We currently have 5101 homes in the Louisville MLS inventory.  By doing the math, we calculate that we have an 8.67 month supply of homes if no more come on the market.

In the group of condos and patio homes, we sold 253 in the same time period or 84 per month.  With a supply of 1282, this gives us a 15.2 month supply of condos and patio homes.

My client’s real interest was in a patio home.  In the Louisville MLS; condos, townhomes, and patio homes are grouped together.  I was able to pull out the numbers for patio homes and give a more definite number.  There were 38 patio homes sold out of a current inventory of 235 patio homes.  This gives us an absorption rate of 12.67 per month.  Doing a little more math gives us an 18 month supply of patio homes.  This is definitely a buyer’s market!

If you have any questions about this, feel free to contact The Dobbs Team in Louisville KY.

The Dobbs Team had the pleasure of bringing a buyer to a short sale in the Locust Creek area of Louisville KY.  This home sold for $1.2 million in 2004 and was extremely well appointed.  Every luxury item that you could imagine was there and then some more. The Millwork was very extensive and very well done.  Interior doors were 8’ tall. As you would expect, the kitchen was a chef’s delight.  There was a separate work preparation island with a 3.5 inch butcher block counter. The basement was very well done and included a theater room and killer bar.

The listing agent was excellent and did a great job in negotiating with the bank and working with their sellers.  They were extremely knowledgeable about the short sale process and actually like the complexity of the challenge that short sales present.  We were 80 days from offer to final close.  We avoided the Jefferson County Commissioner’s sale with less than 24 hours to go.  We have more detailed information about Louisville Distressed Properties on another page.

The lender also did a great job.  Once we received short sale approval, we had a narrow window to get the loan in place.  Our loan officer was able to rise to the challenge and we closed with no hiccups.

It took all parties to make the short sale on this luxury home happen.

Was it a pain in the butt dealing with this short sale?  Yes.  Did my client get a great deal?  YOU BET!!

For more information on how you can get a great deal on a short sale in Louisville KY, feel free to contact the experienced agents at The Dobbs Team. 

Today, I went to the Jefferson County Circuit Court Master Commissioner’s sale on Liberty Street in Louisville.  I had not been in a while and there was a foreclosure house in Glenmary that was on the auction block today.

As always, it was a fast paced auction with each house selling in seconds.  Once they read the description and ask for an opening bid, it is over very quickly.  This is nothing like the old farm auctions where there strive to squeeze every drop from the buyers.  You need to be ready to bid and bid quickly.

Today’s Louisville commissioner’s sale had 139 properties for sale.  Of these, 59 were withdrawn before the sale.  It seems to be a growing trend to pull the property at the last minute as the percentage withdrawn is higher than 2 years ago.  I attribute this to the short sale process actually working along a few loan modifications (very few).  This left 80 properties to go under the hammer in prices ranging from $12,000 to over a million dollars.  Now the interesting part, only 3 of these actually sold to someone besides the bank pressing the action.  For the remaining 77, there will be more legal fees, maintenance fees, real estate commissions, etc.  They will all have been 'cleansed' by the foreclosure process.

Most all of the bidding started at 2/3 of the Commissioner’s appraisal done just before the sale.  Only 2 properties sold lower than 2/3 as that triggers the right of redemption for the homeowner.  If a property sells for less than 2/3 of the appraisal, the homeowner has a year to buy the property back at the sale price plus 10% interest.  And, he keeps whatever improvements have been made in this time frame.

I thought it was perplexing that several times the bid price approached or exceeded appraised price, but the foreclosing bank kept increasing their bid until they owned it.  As I mentioned before, only 3 bidders were successful today.  The property in Glenmary Estates that I had interest was appraised by the master commissioner at $290,000.  I was the runner up bidder but quit letting the bank have the final bid of $274,000.  This was 94% of appraisal.  For me, this was a lot of money to invest in a house that I had never been through.

I mentioned that the sale goes quickly.  From start to finish, the entire sale was over in 60 minutes.  This included announcements and the time getting the 3 buyers to the table to make their purchase of the foreclosed property.

If you have any questions about the foreclosure process in Louisville KY, contact the The Dobbs Team in Louisville KY.  You can also search for Louisville foreclosures or bank owned homes along with Louisville short sale homes on our website.

Radon is a cancer-causing, radioactive gas.  In Kentucky, around 42% of our untreated homes will have levels above the EPA action level of 4.0 pico curies per liter of air.  In Louisville KY (Jefferson County), the Radon level increases to over 60%.  The levels of Radon Gas depend on the type of soil and rock structure beneath our homes.  The Radon levels vary across counties and will vary from house to house in the same neighborhood.  Fortunately, it is usually easily mitigated by a Radon Professional.  Costs will generally run $800-$1,000 and should include a follow up test showing the radon mitigation system is doing its job.

In general, the longer the test the better and more accurate the tests will be.  On most real estate transactions in Louisville, we receive a 48-hour test.  The Dobbs Team prefers a written report with results posted hourly.  This gives us the average that we need to form a decision and often a graph to see how wide the results swing.

On the seller’s disclosure form, the sellers are asked if there has been any testing for Radon gas.  If so, what were the results?  If the home inspection results show a high level of Radon gas, the buyers most often will ask the sellers to install a Radon mitigation system.  The sellers have the right to refuse; but it is now a Catch-22 situation.  Let’s say the deal falls through.  Since the sellers now know of a Radon Test being performed, they need to post a new home Seller’s disclosure with the tested results.  This is certainly a red flag to the next prospective buyer.

The Kentucky Association of Radon Professionals is active in KY and helps homeowners make informed decisions about Radon.  They have produced a Consumer Guide to Radon Reduction in KY PDF file which is very informative. 

It can be very confusing to know what the Radon numbers actually mean.  The Kentucky Association of Radon Professionals have made a chart comparing Radon exposure to smoking cigarettes and chest x-rays.  In KY, we have a high percentage of cigarette smokers.  Radon gas can contribute to lung problems.

The EPA has also quite a bit of information about Radon and have made a booklet on the Home Buyer’s and Seller’s Guide to Radon.  This is even more unbiased information on the dangers of Radon Gas.  The EPA has also produced a booklet on A Citizen’s Guide to Radon.  The Dobbs Team thinks that the informed consumer is the best.

In our last blog, we talked about Absorption Rate and what it means.  As a Louisville REALTOR, I can feel that we are in a buyer’s market, but what about analyzing this?
In the last 60 days, there has been 1104 single family homes closed in Jefferson County, KY.  This would give us an absorption rate of 552/month.  This equates to a 10.6 month supply of homes if sales continue at this rate and no new homes are put on the market.  By anyone’s definition, this is a buyer’s market.
Condo sales in the last 60 days have totaled 161 in Jefferson County.  We have an Absorption Rate of 80.5 per month.  Using our calculator, we come up with an 18.8 month supply.  WOW!
Focusing on a particular area is important as the old adage of “Real Estate is local” certainly applies.  The Highlands has always been a desirable area in Louisville with an eclectic feel.  The shops are great and you can bike or walk and save wear and tear on your car.  The single family home absorption rate of 61.5/month is compared to condos at 10.5/month.  The bottom line is that we have an 8.7 month supply of SFR’s, and a 14.7 month supply of condos.  Still a buyer’s market, but much higher Absorption Rate than the entire market in Jefferson County.
If you have any questions about absorption rates in other areas or surrounding counties, feel free to contact us.

You may have heard about absorption rates in real estate and wondered how this applied to the Greater Louisville KY area. First we need to define Absorption Rate and how Absorption Rate is calculated.

Absorption Rate is the rate at which homes are absorbed into the market. It could also be expressed as the number of months or weeks that it will take to clear the current inventory of real estate listings. A low Absorption Rate would indicate that homes are slow to sell and therefore, slowly absorbed into the market. A high Absorption Rate would be the opposite. The bottom line is that we are weighing supply and demand in the current housing market.

To calculate the Absorption Rate, we would to determine how many active and pending listings are available in a certain area, price range, etc. We use “pendings” as well, because they have not truly closed or “sold” yet. We then need to know how many completed sales were in the last month (or some other time frame). Now we divide the listings available, by the listings sold last month.

In the Fern Creek area, we sold 194 homes in the first 3 months of the year.  We have an Absorption Rate of 64.67/month in that time period.  Sometimes, Absorption Rate is expressed in months of supply.  We had 846 homes to sell at the end of March giving us a 13.1 month supply.  (846 homes/64.67 Absorption Rate)  This example would be a low Absorption Rate.  Keep in mind that this equation does not allow for new homes entering the market.

What about Seller’s market versus Buyer’s market? The old rule of thumb is that we have a seller’s market when we have a high Absorption Rate of 1-4 months. A buyer’s market is from a low Absorption Rate of 7 or more months.

It is easy to get lost in figures. It is best to refine the market numbers to county, market areas, price ranges, type of homes, etc.  In the Louisville KY market, the Absorption Rate in Area 4 may vary widely from Area 8. Condo sales in Louisville versus stand-alone homes will be much different with condos having a much lower Absorption Rate.  Another look at absorption would be price specific. A $500,000 listing will be on the market for much longer than a $100,000 listing due to the increased number of potential buyers.

If you know of someone that needs to buy or sell a home in the Louisville KY area, feel free to contact us at 502-439-8437 or just send The Dobbs Team a note.

There will be an open house at 10610 Fairmount Falls Way this Sunday, May 1st.  This custom built home is located in the prestigious section of Glenmary Estates.  Glenmary Estates is a newer section of Glenmary located on the southernmost edge.  The Glenmary subdivision is in the southeastern edge of Louisville KY along Bardstown Road.

This 1-story ranch is a little unusual because in Glenmary; 1.5-story and 2-story homes seem to dominate.  Upon entry, 12 foot ceilings and the very open floor plan give a dramatic open feel.  The fireplace, with its ornate decorative wood and granite, makes it a real focal point.  As you would expect, the kitchen is modern with Stainless Steel appliances and granite countertops.  To give an example of quality, all of the closets including the basement have built in shelving with no wire rack shelves anywhere.

It is quite obvious there was no expense spared in the construction. It was lived in for 10 months and remains in pristine condition.

For more details, take the Fairmount Falls link. For a different perspective, our Keller Williams website shows information about the area.

Come see The Dobbs Team in action this Sunday and see how they market homes.

Home buyers using FHA backed loans in Louisville KY saw a change in the annual mortgage premium payment this week.  Up until April 18th, the annual premium was .90% for LTV (Loan To Value) of 95% or higher.  It has now increased to 1.15%.

FHA loans are still very attractive as they have one of the lowest minimum down payments required asking for only 3.5%.  This is a far cry from other lenders looking for 20% down.

Let’s use a $200,000 home purchase as an example.  We will figure the normal amount of 3.5% down payment ($7,000).  At the old rate of .90%, we would pay monthly mortgage insurance of $150 per month.  At the newer increased rate of 1.15%, our monthly bill increases to $191 per month.  That is $41 per month or nearly $500 per year.  That will buy a lot of groceries.

For a couple with a borderline debt to income ratio, this increased rate may make them become ineligible for the home of their dreams.

To try several “what if” scenarios for Louisville Home loans, try the mortgage calculator and plug in different purchase price amounts.

For more on this subject, see your Louisville mortgage broker, or contact us.

I recently picked up a listing in Glenmary Estates which is one of the newer sections in the Glenmary Development.  This house was vacant and in its history, had been listed with 5 other real estate agents. Among other things, we decided to rent some furniture and have it professionally staged.

I had shown the house to a client a couple of months ago; he is a careful shopper and will be making a decision in May.  His girlfriend liked it, but he did not care for it.  I convinced him to come back for a second look last week and he reluctantly agreed. He was immediately impressed when he opened the door and ended up staying for an hour. The staging helped define area and gave the house a “lived in” look that helped him imagine what it would look like with his furniture.

Our open house had people “oohing” and “aahing” equally.  Now, let’s have one of them make an offer.

You can see the home in question here.

The Dobbs Team is associated with Keller Williams, the second largest real estate company in the United States. By the end of 2010, they had over 79,000 associates and over 700 market centers. J.D. Power and Associates rated us highest in overall satisfaction by home buyers among the largest full-service real estate firms for the third year in a row.
The real news for KW agents is the roll out of eEdge. This is a new software package that will enable us to manage our leads from our initial contact all the way to the transaction close.
What does this mean to our clients? When eEdge fully rolls out, we will be more efficient.  We will be able to get signatures on our iPads while we are out in the field. We also will be able to invite the listing agent, sales agent, seller and buyer into the transaction.  e-Edge will give us the capability to have paperless transactions.
Obviously, Keller Williams is leading the way in technology and the agents in Louisville, KY are up to the challenge.
As part of the new service, we also have a new web site. http://www.findahomeinlouisvilleky.com/ Their IDX (Internet Data eXchange) features are a little different than what you see on The Dobbs Team site. On each listing from the Louisville MLS, they show the market trend for that particular zip code. They also show the nearby schools, as well as a mortgage calculator info box. On the left side of the screen, they also show nearby listings.
We invite you to check out our new site.

The Dobbs Team closed on a house last week in Mt. Washington, KY.  Seems pretty ordinary until you consider what we wanted to accomplish.  Our client was a young woman that wanted to leave the apartment life. Important to her was having enough money to cancel her lease on the apartment and move into a single family residential home.  We structured the deal to have minimal out of pocket expenses.  We applied for a USDA/ Rural Housing Loan requiring no down payment in Bullitt County.  Through some careful structuring, we were able to close with no money out of pocket. Her only costs were the home inspection.  Feel free to contact us on how we were able to get this done.

We just closed on a house that is one of my success stories.  A young man was looking at an alternative to rent in Louisville, KY.  We searched long and hard and found a 2 bedroom place that had been remodeled for under $50,000.  It wasn’t easy finding a house in this shape in this price range.  His payments including principal, interest, escrow for taxes, escrow for home insurance, and mortgage insurance are less than half of the rent he was paying.  Now he has the joy of home ownership. And saving money.
We found our place in the Churchill Downs and University of Louisville area.  This works great as he will be attending the engineering college next year.

We are still in a buyer's market for Louisville KY. 
In Jefferson County, KY, we are averaging 97 condos, patio homes and townhome sales per month since the start of 2010.  At this writing, we have a 13.5 month supply.
Single Family Residential Homes are a little different story.  We are selling about 600 homes per month in Jefferson County, KY.  This works out to about an 8  month supply.
I think that low interest rates are helping us move inventory.  People are comparing the rent that they are paying versus what it costs to buy a home now and often find, it makes sense to buy a house.
If you have any questions, let us know!

I am holding 4009 Saint Germaine Court open this Sunday from 2-4. Norbourne Estates is an older neighborhood in St Matthews that is just wonderful! The trees are mature, grass green, streets wide, houses well maintained; what else can I say? The house is 72 years old, well built, and move in ready. At $320,000, it is priced to sell.
There are several houses on the street that have had major additions to give them more square footage and their price reflects that fact. Click on Norbourne Estates to take you to this house and the other 4 houses for sale here.
Come see us on Sunday!