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Thursday, June 10, 2004

Vermont Realtors Say War-Weary Homebuyers Seek Country Comforts

by Blanche Evans

Rural Vermont areas such as the Upper Valley, Waterbury, and Rutland County are attracting city-tired homebuyers, who find they can relax in the country, yet hit the highways and be close to city amenities when they want.

Upper Valley

"The Upper Valley includes some Windsor County communities like Hartford, Norwich, Windsor, Sharon, Vermont," says Realtor Hal Sheeler. "We have the natural beauty of gorgeous wooded landscapes, mountains, and rivers. Upper Valley communities also enjoy close proximity to Dartmouth College/Hanover amenities, to Killington and Okemo ski areas, and many recreational opportunities.

He explains, "You can still find a home where you can't see a neighbor or live in a Hartford condo and be only 10 minutes from Dartmouth. Interstates 91 and 89 can get you "anywhere" - up to Montreal or down to Massachusetts. It's a wonderful place to live.The further away that you get from the Hanover/Dartmouth area, the better your chance of finding that dream farm, land, or home at a reasonable price. That seems to be changing, however. The stock market declines and war concerns sent a lot of people out looking for their rural roots, for places to escape urban jitters and find peace, and for investment. Professionals working in Hanover or Lebanon often live in other Upper Valley towns, finding not only that the prices are still a little lower, and they may be able to get wondrous views and a little more land."

Waterbury

"Located in between Stowe, Burlington and Montpelier on I-89," says Realtor Teresa Merelman, "the Waterbury area has seen increasing prices and strong demand. Waterbury's location right off I-89 has continued to make it a sought-after town. According to the 2000 census, Waterbury has a population of 4,915. Waterbury has 51.35 square miles of land. Currently there are 23 active listings. The average list price is $434,752 and the median list price is $369,000. Between 1/1/04 and 5/17/04, there have been 13 residential closings. The average sale price was $243,877 and the mean sale price was $247,500. The average days on market was 61."

Rutland County

"Located in Central Vermont, stretching from the spine of the Green Mountains in the east to the Lakes Region in the west, from Manchester in the south, to Middlebury in the north, Rutland County and the vicinity has a very active real estate market this spring," says Realtor Margaret Henkel, "With mortgage rates still at near all-time lows, buyers can get more for their dollar than ever. Homes priced to accurately reflect today's market values, that are in good condition, sell very quickly. Today's buyers are looking for homes that are well maintained and ready to move into. Because prices have risen eight to 10 percent each year for the last three years on average in the county, very few buyers are willing to purchase homes that look "tired" or in need of repairs."

Henkel suggests, "We don't foresee interest rates rising until after the election in November. Furthermore, property in Central Vermont has not appreciated enough in the last three years to have created a "real estate bubble" as has happened in other parts of the country. When interest rates finally do rise in the future, real estate prices are not expected to go down in our area. For this reason, Vermont real estate continues to be an excellent investment and we are seeing a lot of investment purchasing."

Published: June 10, 2004

Blanche Evans is the publisher of Agent News and the associate editor of Realty Times, the Internet's largest independent real estate news service. She is the author of two best-selling real estate books: The Hottest e-Careers In Real Estate, Real Estate Education Company, an Internet marketing primer for real estate professionals, and homesurfing.net: The Insider's Guide To Buying And Selling Your Home Using The Internet, Dearborn, a consumer homebuying and selling guide. In 2000, she was recognized by the editors of REALTOR(r) Magazines as one of the "25 Most Influential People In Real Estate," and in 2003 when the "Most Influential" list was updated, she was recognized as one of nine "Notables." She is also a frequent contributor to "Your Money" on CNN fn.

Copyright © 2004 Realty Times. All Rights Reserved.

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To Sell Or Rent: A Difficult Decision

by Henry Savage

Question: I own a condominium in Jersey City, New Jersey. I have a mortgage balance of $53,000 at a 7.50 percent rate. I am not interested in refinancing but I am considering moving and turning the condo into a rental.

If I sell, I'm pretty sure I could get $150,000 for the unit. If I rent, I should be able to get $1,150 per month. Most two-bedroom units are renting for $1,000 but my unit is much bigger. Including the condo fee, I pay $922 per month, so I could have a nice positive monthly cash flow.

However, I am concerned about keeping it rented. There are problems with the boiler in the winter and sometimes we have no heat. Management won't fix it! Also, it's a noisy unit -- I can hear the people above me walking across the floor.

So my question remains: Should I stay or should I go? Other owners are telling me to hold on to it and that the unit will keep going up in value. Any advice is greatly appreciated.

Answer: Wow. I don't know how to answer your question. In reading your comments, it appears you may be living in a condominium that is at best, poorly managed, and at worst, underfunded. No heat in the winter? That's pretty serious. It appears that your homeowner's association has no money or the building is suffering from poor management.

Noise is a pretty common problem in condos. Some buildings are made better than others, and some isolate sound better than others.

It sounds to me that you have made your decision to move. The question is whether you should sell or rent. My advice is to explore these options in a bit more detail. Let's look at the option of renting.

First, you need to find out what's going on with the property management. Read the latest financial report. Call the president of the homeowner's association and ask him or her why the boiler isn't being fixed. Get an understanding of the financial health of the association. Call the management company that's hired by the homeowner's association and ask them the same questions.

If your research shows that the association is in financial good health but the management company is shirking its responsibilities, you need to lobby the board of directors to hire a new property management company. If your research shows that the association doesn't have any money, you have a bigger problem. No money leads to maintenance problems, increased condo fees and special assessments. These things do not help property values.

You also need to increase your research on the rental market. How sure are you that you can secure a lease for $1,150 per month? Is there strong rental demand, not just in the building but in the neighborhood?

Now let's look at selling. How strong is the sales market in your building? Are units selling quickly or becoming stagnant on the market? By most accounts, the nationwide real estate sales market continues to be brisk, so now might be a good time to sell.

It's also important to consider the money that's tied up in your unit. If you move without selling, do you have enough liquid savings for a reasonable down payment on a new home? After selling costs and paying off the mortgage, you have about $85,000 in equity that could be turned into cash. You need to carefully examine whether or not you want that much money tied up in a condo that has a broken boiler.

My knee-jerk advice would be to sell, take your cash and move on. But my reasonable advice would be to take the steps mentioned in this column -- educate yourself on the facts and you'll be able to render the best decision.

Published: June 10, 2004

Henry Savage, the president of PMC Mortgage Corporation in Alexandria, VA, is a mortgage columnist whose work has appeared in numerous consumer, real estate, and mortgage publications. Mr. Savage welcomes your questions for possible use in this column, however because of the volume of mail received, Mr. Savage cannot answer questions individually.

Copyright © 2004 Realty Times. All Rights Reserved.

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