Real Estate

How Dayton home sellers can create their own Seller’s Market in 2011

March 6, 2011 By Teri Lussier 3 Comments

You’ve heard that this is a Buyer’s Market? Well here’s the thing: Every market presents a great opportunity for someone, and if you are a seller in Dayton Ohio, there could be a chance for you to make money, even in this market.

Consider: Everybody needs a place to live, and Daytonians are no different. So while you may have heard about changes in lending practices and how this will make it more difficult for buyers to obtain a loan through a lender, what this really means is that other options have now opened up for both buyers and sellers, but particularly for sellers.

Once upon a time (way, way back in the 80’s) a typical home loan came with a double digit interest rate of 12-18%. Shocking and unheard of today, but it was the norm 30 years ago. Buying a house was difficult and there was a real barrier to home ownership, but this meant a few things happened: One is that you really had to work at purchasing a home. You had to want it, value it, understand the implications of a loan and how it would impact your life. That’s not a bad thing, is it? The other thing that happened is that home sellers could actually compete against banks by financing the loan themselves. Seller financing, lease to own, lease to purchase, and land contracts, these were common alternatives to a conventional loan.

Once interest rates dropped and loans became easier to obtain, owner financing become less attractive to buyers and almost impossible to compete against for sellers, but that niche market has come back as an attractive alternative for sellers looking for options in this market.

Seller or owner financing can provide value to those sellers who might be looking for a way to aggressively compete in a strong buyer’s market because your buyer pool is going to increase significantly. It’s one of the most frequent requests I receive from home buyers. Or, maybe as a seller you are looking for a different way put your investment money to work? Well-planned seller financing could produce a higher return than a traditional rental or other investment. And you might consider seller financing if you simply want another stream of income, but are looking for an occupant who is a little more serious about the property than a renter.

But seller financing can benefit buyers in a few ways as well. Buyers who might have a poor credit score now and therefor can’t get a traditional loan, but are well on the road to recovery, can still buy a home and enjoy the benefits of home ownership. And the purchase process itself is much quicker, and possibly less expensive, without the added participation of a lender and all the added fees. One thing for a buyer to be aware of- there is a huge demand for seller financing right now. That particular niche is a strong seller’s market, which means you could be paying a premium for the property. In all things financial- caveat emptor.

Owner financing isn’t an option every situation, but if you are buying or selling a home in Dayton, you might want to educate yourself to all the possibilities- which is beyond the scope of this one article. Take your time and talk to experienced professionals. Lawyers, real estate agents, tax accountants, can all provide you with information, and often guide you through the process to help you make solid decisions about any real estate transaction.

The real estate market continues to change, in fact it will always be changing, but as I’ve said before, the key to making the most out any real estate market is by keeping your eyes open for whatever new opportunities the most current market presents.

Looking forward: Opportunities in the Dayton real estate market for 2011

February 10, 2011 By Teri Lussier 4 Comments

“Sometimes we stare so long at a door that is closing that we see too late the one that is open.” -Alexander Graham Bell

By now we are all aware that the foreclosure crisis is many layers deep, touches every person in America, and the impact will be felt for at least a few generations. The stories of those most affected by foreclosure are frequently discussed in any news medium you care to look. But there’s another story out there and it’s just as important to tell. There are new and beneficial real estate opportunities that have suddenly presented themselves to those people who have decided to move beyond fear and look at Dayton Ohio real estate with new eyes. I’d like to share a few of those stories.

Did you ever see the video of the baby elephant who gets stuck in the watering hole? The baby needs help, the mama needs help, the extended family works together to get this baby unstuck. Most mothers will tell you that once you become a mother, all children are your children. Your kid’s friends are extended family, and that was the situation with recent buyers.

Their daughter’s friend had become family and needed a place to live. The buyers- middle class folks who lived in a modest 3 bdrm, 1 bath brick ranch home in Clark County- were in a position to help. It was good timing for them. They saw a need, saw the opportunity, figured out a way to make it work. They looked at several homes, made a few low ball offers, and we found a seller who was willing to negotiate. They purchased an outdated property for cash, fixed it up, and are now renting it to the friend. A simple business transaction? On paper, yes. But emotionally, this was an extremely satisfying transaction for everyone involved, including the seller. The property was an estate sale, so there was a lot of emotion involved from the seller’s side as well, and they were very happy to know how the property was going to be cared for.

I’m seeing more parents purchasing homes for their kids. Lower home prices mean that the parents, who often have more cash, have better credit, and have the skills and ability to take a distressed property and renovate it, can do that for their extended families, and that’s good, but there’s more to this story because the other thing that’s happening is that it’s creating some continuity in the Dayton area. Young families are putting down roots.

This is happening across economic lines. Cash buyers are looking in neighborhoods that were once neglected. You can buy a big home in the Dayton area for under $15,000 and absentee owners are getting some competition from Dayton area families who want to own a home but can only pay cash.

I have a client who lost a good job. He has access to cash, and has become an attentive landlord, using real estate to provide income for his family. One of his purchases was located around the corner from his home, it’s a short sale that he is now renting back to the previous owners. In this transaction, everyone made the most of a difficult situation. Local people are becoming conscientious landlords; renting to their own children, or are purchasing property in their own communities. This can create a vested interest in making sure that rental property is maintained and cared for. Not only does the landlord benefit, but neighborhoods and communities can benefit from this as well.

First time home buyers are another buyer niche that can create wealth through real estate even in this market. This is not the same wealth that the market sustained prior to 2007, this is slow, steady and purposeful planning by using low interest rates to purchase very specific investment properties in just the right locations, in order to create another stream of income for these younger home buyers.

I don’t know what the long term effect of the upheaval and resulting change in attitudes and opportunities will be, but in the short term it means that there are families moving into neighborhoods that need the stabilization families often bring. It means Dayton can have communities in which there are renters and landlords who have ties to each other and to the neighborhoods in which they live. Each of my clients has taken a crisis and found the positive opportunities available. There is no denying that doors have closed to many people, and I’m not here to proclaim the old Realtor’s saw about “This is a great time to buy!” because obviously that’s not the case for many people, but, every change and challenge bring an opportunity for someone, and right now there are plenty of doors that have just been thrown wide open for a whole new group of people; doors could have only opened in a real estate market like Dayton, circa 2011.

One Year To A Better Neighborhood

January 16, 2011 By Teri Lussier Leave a Comment

Before Dayton had “Originals”, we were a “City of Neighbors”. I’m not sure when we stopped being so neighborly, but one of the things I hear from buyers is that they want to live in a neighborhood where residents really know each other. They want a sense of community and camaraderie. People don’t just buy a home, they buy into a neighborhood and they want to know that not only are there are people within shouting distance who’ve got their back, they want to find a neighborhood where their own presence is felt and appreciated. Not all neighborhoods come with a ready-made sense of community so maybe it’s up to you to be the change.

The start of a new year is the perfect time to make a plan for your community, so I’m offering some ideas for becoming a stronger neighborhood. One for each month, these are generic, easy, simple- a spring board for what might work in your own community, but hopefully they will get you started. If you have kids, your job is easy. Kids are natural neighbors who use the block as a playground and every new person is a potential friend, whereas adults use the home as a refuge. Fight the urge to shut the door against strangers in your own neighborhood. There’s a difference between being friendly and being nosy and very few people in your neighborhood will complain about the former.

January: Hire a kid.
We get snow in January, and believe me, there is a teenager in your neighborhood who would love to make some money shoveling snow. Hire them. Hire them! Set your expectations high and hold that kid to those expectations, but hire the kid, and hire them to shovel your elderly neighbor’s driveway as well. Don’t make the 3-foot-nothing kindergartners on the block trudge through 5 inches of snow.

February: Take a walk.
There are usually a few days in February where the weather breaks. Get out of the house and take a look around. Notice which neighbors are gardeners and who likes landscaping. Where is the neglect in the neighborhood? Is there a need there that can be filled? Wave hello. In the car, on the sidewalk, across the street- wave hello. Acknowledge that you recognize that you are sharing space with your neighbor and 95% of the people you wave to, will wave back. Who knows? They may even smile. 🙂

March: Clean up your yard.
March winds mean a lot of flotsam and jetsam starts blowing around the neighborhood. Clean it up, your mom doesn’t live there. When you walk, take a bag with you and pick up the garbage you see. I know you didn’t put it there, but you live there, and trust me when I tell you that your neighbors will notice and will start to take pride in their neighborhood, too.

April: Meet the gardeners.
Someone in your neighborhood is a horticulturist by passion. Because you’ve been out walking and paying attention, you’ll know who they are. Early weekend mornings, go meet them. Walk past, say hello, compliment their yard, get their advice, find out where they shop for plants and how they treat their soil. If you don’t care for plantings, perhaps you can find the best lawn in the neighborhood and talk to them. These people are regularly outside, they know what is going on in the neighborhood. They are clued into the community same as the house with all the kids. Get to know these people. If you have the opportunity to start a community garden, do it!

May: Neighborhood Open House.
The historic districts in Dayton do these on a regular basis, but why not your neighborhood? Contact the Realtors who have listings in the neighborhood and get this started. My guess is that any Realtor worth her salt would jump on this idea in a heartbeat and do a lot of the heavy lifting for you. It’s a great way to spruce things up, show off the community, and bring people into the neighborhood.

June: A neighborhood cookout or block party.
Pot luck, casual, bring the kids, keep it outside. Easy does it. Invite local police if that would be helpful, appropriate, and productive.

July: Exterior updates to the house.
Attitudes are contagious. Painting the shutters, or replacing windows, or a new roof will get your neighbors out of their homes to talk about it with you, and you will soon see improvements to their homes as well. Very few people want to live in the worse home on the block, and some blocks simply need one or two home owners to decide that the neighborhood is worth it, before that attitude becomes the norm. If you don’t have a front porch, create the feeling of one and use it on summer evenings.

August: Back to school.
Go to a school board meeting. I’m not sure what affects property values like the local school system. That means you have to know what is going on and you have to hold your elected board members accountable. It’s okay to be the PITA citizen who expects results.

September: Fall Pot Luck.
One last chance to get outside together while the weather is warm. There will be a lot of changes to talk about: Neighbors who have come and gone; a neighbor who is in need; the roads or sidewalks in disrepair; which home is in foreclosure and do you take on maintenance for the vacant property?

October: Trick or Treat.
Beggar’s Night is a great time to get to know your neighbors, don’t turn off the lights and hide in the dark. The younger kids will be out early so buy enough candy for the first hour or half hour and get to know the families in the neighborhood, if you haven’t already.

November: Leaf raking.
Raking, not blowing. Raking leaves invites the neighbors to stop and chat with you, while a leaf blower is a noisy apparatus that repels your neighbors. Rake your leaves and skip the trip to the gym.

December: Share with your neighbors.
Self-explanatory.

There you have it. A painless way to get to know your neighbors. Each neighbor has something unique to bring to the neighborhood, and not everyone will be receptive to participation. Respect those differences, but find a way to build on them, and you’ve got the beginnings of a vibrant, growing community.

Okay, I’ve shared my ideas- let’s hear from you all. What makes your neighborhood such a great place to live and how do you create a sense of community?

Photo courtesy of TLussier

The Litehouse Development solves a few of Dayton’s housing problems

September 11, 2010 By Teri Lussier 3 Comments

… but probably not what you think.

You know that the city of Dayton has a vacancy problem, and there has been a lot of discussion about what to do with vacant, abandoned properties. Tearing them down is one option of course, and probably the one that gets the most discussion, and there is a problem with tearing them down because then you have an empty space, and what do you do with that? I believe that the vacancy problem is two-fold. Not only does Dayton have too many homes, Dayton has too many of the wrong type of home.

Yes, Virginia, there really are people who want to live in Dayton Ohio. They want to experience all that Dayton has to offer- celebratory and inexpensive stuff to do, vibrant arts community, not-so-big city life. They want to be home owners, not renters, but they can’t find a house. Oh I know we have plenty of homes- too many homes in some neighborhoods. But for a certain type of buyer: young or creative or entertainment-seeking types who would be a perfect fit in the downtown area, Dayton doesn’t have what they are looking for because the housing stock that exists, is simply not a good fit for everyone. Downtown Dayton’s housing stock is plentiful, but it’s old, and the truth is that not everyone loves a historic home. Not everyone wants to live in or care for a historic home, and that’s okay, except, if you want a brick ranch, mid-century modern, vintage 20’s bungalow, or modern dwelling, then you have to live elsewhere. So the solution might be to mix things up a bit- not only tear down the unwanted housing stock, but build property that people want: Affordable, low maintenance, cool, hip, modern spaces that appeal to and attract a new breed of owners into the Dayton market.

I visited the Litehouse model home site last week during their Open House and was intrigued by what I saw. The exterior is modern and unlike anything else in the Dayton area. The interior is unusual as well, being a vertical stacked space that packs amenities onto a tiny physical footprint. This should appeal to a very specific buyer, but more than that, it’s going to add to the presence of residents in the direct downtown area, and that’s a cool thing, good for all the city residents.

The Litehouse townhomes focus on greener living, with local manufacturing, Leed standardization, Energy Star appliances to keep these homes as efficient as possible. This is going to be a growing trend and it’s nice to see a builder using proactive solutions for those buyers who are already looking in this direction. They are also looking to attract buyers who want an affordable home. This is going to be key for getting more buyers into Dayton: Affordable, modern, green properties that give buyers another downtown living option. The plan is to create a community of approximately 40 homes, and once a few more are occupied, you’ll see them attract more buyers- most people don’t want to be the first in a new development, although, you do get a nice view of Patterson Blvd right now.

These are sexy properties with a new attitude about how a home can function and what a home can be. Take a look at the couple to the right. Standing on the unfinished roof-top terrace of one of the Litehouse units, you can see the natural response to the possibilities this space might afford- the body language says it all. This is the type of housing that Dayton needs more of and it’s good for the entire Dayton area that we have the opportunity to watch this development add to our real estate options in Dayton Ohio.

So, how do you buy a new home? You can plunge ahead and contact the developer yourself if you’d like, or you can have a Realtor take you to a developer if you want a little extra guidance through the process. It’s similar to buying any home, except, as one developer told me, there is no other person’s dirt to wonder about.

The question is, can majestic historic beauties live in peace and camaraderie with ultra-modern clean cut lines? For all the talk about not wanting to live in little boxes that all look just the same, most people like a sense of continuity and similarity within their own neighborhood. With the Litehouse development, we can begin to integrate the new and old while we adjust to the future of Dayton real estate.

Photo credits: Teri Lussier

How 1,500 Vacant Dayton Lots Could Blossom into the Growth of Civilization

May 24, 2010 By Teri Lussier 1 Comment

There are 1,500 vacant lots in the city of Dayton. Fifteen hundred?!? Let that sink in for a moment. These aren’t boarded up homes, vacant homes, abandoned homes, these are vacant lots that the City of Dayton has to maintain, somehow. It’s staggering to think about. I see plenty of these lots, and you do too, but to think about 1,500? So the question of what we should do with these lots comes with some urgency behind it, but also some promise and potential. Dayton now has Jonathan Cain with the Lot Links program and several months ago he took some time to talk to me about Lot Links. Mr Cain, like Leah Werner, is a true champion of the potential in Dayton. He’s excited about the possibilities and the opportunities the Lot Links program could represent, if we really thought about it, and he’s open to discussion and willing to help, and looking for a chance to spread the word about this program to clubs, churches and any organization that wants to learn more about it.

You may know that Lot Links is an inexpensive way for Dayton residents to purchase vacant lots that are owned by the City of Dayton. Jonathan told me that most purchasers are neighboring home owners who want to expand their yard space to create a play area for the kids, or a garden, or to put up a garage. Useful purposes all, and those lots would fit well into an established neighborhood without much distraction or disruption in neighborhood aesthetics. You can purchase a lot for as little as $235.00, although a buildable lot is $635.00- still cheap land ownership and the city guarantees clean title without liens. The problem, as I see it, is that land ownership has to be profitable somehow. It doesn’t do any good to simply own a lot. Either you have a house and all the positives that can potentially come with home ownership: Freedom, independence, stability, or you have property with which you can create income: Food production, rental space of some sort, a business.

Ohio is often considered the “Mother of Presidents” with eight Presidents who thought of Ohio as their home (seven if you don’t count William Henry Harrison who was born in Virginia, but was raised and is buried here). Ohio has an extraordinary and rich history and no small part in shaping our country. One of my favorite quotes is from Ohioan and President William Howard Taft “Next to the right of liberty, the right of property is the most important individual right guaranteed by the Constitution and the one which, united with that of personal liberty, has contributed more to the growth of civilization than any other institution established by the human race…”

Back to those fifteen hundred empty lots? That’s a lot of property. But we also now have the opportunity to offer people, for dirt cheap, the chance to enjoy one of the most “important right(s) guaranteed by the Constitution”. How can we use this opportunity to its best advantage? I have a few ideas. We can, and probably should, have a community garden every few blocks- gardening is good for us, but that’s not likely to be an income-producing or highest and best use of land. Expanding your lot size adds value to a house, as does a garage, so for a neighbor to acquire a lot for their own use, that’s a good idea. We tend to think of these lots as either private residential, or some sort of community property, but I think it might be beneficial to start to consider business uses and allow room for developing the lots in profitable ways- I’ve begun to think of this as “micro-development”.

If we want to promote the “growth of civilization” in Dayton Ohio we might do worse than making room for unique uses for all these vacant lots: Allow someone to build a garage and rent it to a neighboring homeowner; pave an empty lot and rent out off-street parking; true urban gardening including chickens for income producing fresh eggs. In other words, we open the land for micro-development, for someone to use for a small business. It’s weird, perhaps. It’s certainly not what we signed on for when we decided to plant roots in Dayton, but the only constant in life is change, and the strong adapt. Momentum builds momentum and rethinking highest and best uses for what we have in abundance is a possible way out of our current situation.

We can flourish, if only in small ways at the start, by reveling in our right of property, which is one thing Dayton has plenty of right now- inexpensive and available property. San Francisco doesn’t have it, nor does Oakwood for that matter. Dayton has an opportunity to celebrate what President Taft understood was crucial, integral, part and parcel to what makes America such an extraordinary place- our right to own property. It would be a shame for us to ignore such strengths.

Photo: Teri Lussier

Correction: Initially this article stated there were 15,000 vacant lots; it has been corrected to 1,500.