Our fearless leader and namesake Ralph, is in New York City this week for the 19th Annual RISMedia Leadership Conference, where he’ll be joined by dozens of other real estate industry professionals as they explore the best practices in building and maintaining a high functioning real estate agent team. This year’s event, which takes place at The Roosevelt Hotel in Manhattan, promises to be another memorable RISMedia-coordinated event, and those of us here at Ralph Roberts Realty couldn’t be happier about Ralph attending and speaking at this year’s event.

There’s been so much talk as of late about real estate agent teams. Are they good for the real estate industry? Are they bad for the broker? Regardless of the answer, real estate agent teams are popping up all across this great nation of ours, and Ralph, who recently took on the lead authorship role for the new book “Power Teams: The Complete Guide to Building and Managing a Winning Real Estate Agent Teams” (co-authored by John Featherston, Founder/CEO & Publisher of RISMedia) will be attending this year’s Conference to talk about the unique ways real estate agent teams like ours work with buyers and sellers, vendors, members of the media, and more.

Ralph’s session–a panel discussion he’ll be facilitating titled The ABCs of Forming a Winning Agent Team–will inform Leadership Conference attendees about the basic steps toward forming their own agent teams. Joining him, as Panelists, are a number of successful Realtors from around the United States who already know the in’s and out’s of running a successful real estate agent team, including:

• John Bendall, Team Leader, The Bendall Group
• Bryan Felder, Realtor, The Virginia Realty Group
• Faye Rispoli, Broker Associate, RE/MAX Premier
• Howard Witz, Associate Broker, Fillmore Real Estate

Why are we telling you about all of this? It’s simple, really: Recognizing that you have many choices when it comes to representation and expertise when buying or selling a home, we here at Ralph Roberts Realty want to stress the importance of working with a real estate agent team that not only knows the local area but also understands how national trends and cutting edge business practices can and will save you time and money. Ralph’s participation in real estate industry events like RISMedia’s Annual Leadership Conference allow our entire team to gain an understanding of how other successful real estate agent teams best serve their clients, which at the end of the day directly benefits you–our client!

To learn more about what our real estate agent team can do for you and your family, call our office today and be sure to mention this blog post. The office number is (586) 751-0000.

House Michigan!, a new cable television show designed for Michigan residents, will air on cable stations statewide beginning this. The new program will provide practical information and advice for Michigan residents on homeownership, affordable rental housing, ending homelessness and creating vibrant cities and neighborhoods, which are all things we care about here at Ralph Roberts Realty.

From Keith Molin, Interim Executive Director of the Michigan State Housing Development Authority (MSHDA):

“This is a program that goes right to the core of what’s vital to the quality of life for every person living in the state of Michigan. Residents will learn about affordable, safe and secure mortgage loans, mortgage refinancing loan options, how to prevent foreclosure, affordable rental housing options, including rental for people with special needs, and where to go for help with homelessness and domestic violence issues.”

House Michigan! programming will provide realistic advice to improve the quality of life for everyone and lead to vibrant cities and neighborhoods across the state. Molin hosts the program himself, which includes interviews invited guests.

According to the MSHDA, House Michigan! has been released to more than 80 cable stations statewide and is expected to run multiple times throughout each month, with new shows produced monthly. Check local listings for air dates and times.

You probably don’t need us to tell you that Michigan’s economy is currently on low. We’re facing one of the worst housing meltdowns of all time, foreclosures are at near record levels, many people have lost their jobs, and a lot of once proud local business establishments are either shutting down or moving to more fertile ground.

(Incidentally, Dante Chinni has an interesting little take on our local economy in an item appearing in today’s The Christian Science Monitor: “In affluent Michigan, a firsthand look at the trickle-up recession.”)

In any event, if you’re thinking about buying, fixing up, and eventually flipping a property, you may want to read an article featuring our founder and CEO (Ralph R. Roberts) in this week’s edition of Crain’s Detroit Business:

For more, including Ralph’s own thoughts on flipping houses in this economy, read “Some area house flippers find upside to housing downturn” by Tom Andrew of Crain’s Detroit Business.

It ain’t the guns nor armament,
Nor funds that they can pay,
But the close co-operation,
That makes them win the day.

It ain’t the individual,
Nor the army as a whole,
But the everlasting team-work
Of every bloomin’ soul.

From the team here at Ralph Roberts Realty, here’s wishing everyone reading this blog entry a happy, relaxing and safe Fourth of July/holiday weekend.

If you’re out an about this weekend and are looking to find some of the most affordable deals anywhere in the country, give us a call at (586) 751-0000, or drop us a note at RalphRoberts@RalphRoberts.com.

We are pleased to announce that our founder–Ralph R. Roberts, GRI, CRS–has a new book. Power Teams: The Complete Guide to Building and Managing a Winning Real Estate Agent Team, is now available from RISMedia. Co-authored with RISMedia President & CEO John Featherston, Power Teams is a definitive resource for Realtors and real estate agent teams alike. Like all of Ralph’s other books, this one is packed with proven strategies and best practices, and comes with the added benefit of including insight from some of the nation’s leading real estate agent teams.

From Ralph’s co-author and publisher, John Featherston:

Being a real estate agent just isn’t what it used to be. Today’s real estate consumers are more sophisticated and knowledgeable than ever before. Ralph and I both believe that in order to remain competitive, agents have to do much more–place more phone calls, ramp up their marketing efforts, offer additional services, and spend more time with their clients to better understand the needs of today’s real estate consumers. Many agents are feeling the strain and looking to the team concept as a solution for themselves and their customers. In Power Teams, we help agents–and brokers–overcome the obstacles of creating and succeeding with an agent teams.

In Power Teams, Ralph and John set out to:

• Define and explain the agent team concept
• Review the various agent team models
• Help agents decide whether the agent team concept is right for them
• Show agents how to build a team from the ground up

To order a copy of Power Teams, please contact Pat Hatton, RISMedia Account Executive, at (800) 724-6000 ext. 124 or e-mail. pat@rismedia.com

Today’s edition of The New York Times features the good work of our founder, Ralph R. Roberts, GRS, CRI. In addition to serving as the inspiration behind Ralph Roberts Realty, Ralph is a vivacious author, writing more articles and books over the last three years than perhaps anyone else in real estate.

To read today’s New York Times article, please click on the image below:

Our founder and CEO, Ralph R. Roberts, CRS, GRI, was interviewed for an article about investing in foreclosures that appeared in this past Sunday’s edition of The Tampa Tribune. As many people may know, Ralph wrote the book on investing in foreclosures and our staff here at Ralph Roberts Realty regularly helps people in the metro-Detroit area understand the pitfalls and upside associated with investing in foreclosures.

If you’re considering investing in foreclosures, read Ralph’s book, Foreclosure Investing For Dummies. In the meantime, here’s The Tampa Tribune interview:

The Tampa Tribune
Published: March 16, 2008

TAMPA - One in every 254 homeowners in the Sunshine State received a foreclosure filing in February. That’s the third-highest in the nation.

The foreclosure crisis is negatively affecting neighborhoods and the economy.

But like every crisis, this is viewed by some as an opportunity to profit.

As more homeowners and lenders get desperate to unload properties, they cut prices, making foreclosure homes enticing to real estate investors. Books on getting rich quick off foreclosures arrive on bookshelves daily, and experts are traveling the country holding foreclosure seminars. The process looks so easy that even people with no real estate experience are hanging out at county courthouses, poised to make offers on foreclosure properties.

With foreclosures on the rise and mortgage interest rates low, this may indeed be the perfect time to invest. But, experts warn, it’s easy to get trapped by pitfalls in the market. If you’re not careful, some warn, you may wind up in foreclosure yourself.

The Tampa Tribune interviewed three experts on investing in foreclosure properties and offers a sampling of their advice. The experts are:

- Ralph R. Roberts, co-author of “Foreclosure Investing For Dummies” and a real estate agent and investor in Michigan.

- Mike Kane, chief executive officer of St. Petersburg-based ForeclosuresDaily.com, which sells foreclosure data and holds classes on investing.

- Annalisa Burgos, real estate editor of FrontDoor.com, a Web site that features content from HGTV.

Don’t assume it’s a good deal just because the home is in foreclosure. And make sure you get a fair price.

“Sometimes people get caught up in the foreclosure hype and end up paying more for a home in foreclosure than they would pay for the same house down the street that’s not in foreclosure,” Roberts says. “Foreclosure homes are not always a good deal.

“People don’t realize that you make your profit when you buy and then you realize the profit when you sell. If you pay too much, you won’t make the profit on the back end. Even if you think you’re getting the home for a great price, you have to factor in the costs of fixing up the house.”

Do your homework.

Do a title search. Find out who all the lien holders are, and make sure you know the homeowner’s situation. You could get stuck having to pay those liens.

“Some novice investors can get into trouble when the lender holding the second mortgage forecloses before the main lender,” Kane says. “The investor may actually be buying the second mortgage and find out they still owe the first mortgage.”

Get an inspection, if possible.

Some deals that look too good to be true are just that, Burgos says. An inspection may show foundation, roof or termite problems. Some auctions don’t allow investors to conduct inspections before the sale, she says. Investors should be aware that at those sales, the deal may be final, even if the home has problems.

Some auctions will allow investors to tour the home. If that’s the case, Kane suggests you take a professional inspector or a friend with a good eye for problems.

Don’t wait for the home to work through the foreclosure process.

Buying a home directly from the homeowner, before a lender takes it back, could result in the best deals, the experts say. You can get lists of homes entering the foreclosure process at local courthouses or from some Web sites.

Frustrated homeowners are sometimes willing to give deep discounts to avoid a foreclosure on their record. Lenders who have a lot of foreclosure homes on their books are increasingly willing to accept short sales, which means they’ll allow the homeowner to sell the property for less than they owe.

This method isn’t best for most novices, Burgos warns, because it requires heavy negotiating with homeowners and lenders.

Don’t buy in a neighborhood with numerous distressed properties on the same block.

If multiple homes on the same street are in foreclosure, that could be a red flag that there was investor fraud in the neighborhood during the boom years, Roberts says. If that’s the case, homes may be overpriced, and you don’t want to invest there.

Walk the neighborhoods and talk to neighbors, he suggests.

“If the whole neighborhood is in trouble, you can’t fix that with your one investment home.”

Invest close to home.

Roberts recommends beginner investors print out a map showing where they work and where they live. Draw a triangle around the two locations and don’t invest outside of that area.

“You don’t want to drive 45 minutes to work and then have to drive 45 minutes more to get to your investment property,” he says. “You need to be able to get there easily and often.”

Buy and hold.

“In this market, people can’t even sell their own homes, so it’s difficult to quickly flip a foreclosure home,” Burgos says.

During the housing boom, investors bought homes and immediately flipped them to other buyers for a profit. That time is over, Roberts says. You can make a lot of money investing in foreclosure properties, he says, but you should be prepared to keep and maintain the property for several years.

Ilyce Glink–the award-winning, nationally-syndicated real estate columnist–recently put together a Q&A REO properties for Inman News that I thought would be good to share here:

Question: I have put an offer on a single-family residence at $2,000 over the asking price. The property is a short sale and the bank has already received seven offers on it. The deadline to accept or deny my offer was 5 p.m. last Wednesday. Instead of accepting or rejecting my offer, the bank contacted the agent saying they are waiting until Monday to make a decision. What are my options and what are they trying to do?

Answer (from Ilyce): Here’s what’s happening: The bank is trying to make a decision in a timely manner and your attempt to force the issue isn’t working. (Nice try, but no dice.) So, you have a choice. You can formally withdraw your offer or you can let it sit and see what happens.

Each lender has a process by which it has to evaluate each of the offers that has come in for an REO property to see which one is the best — best isn’t always the highest offer, by the way. It could mean they’re looking for the strongest buyer or one who is able to use the bank’s financing (which is another way for them to recoup their investment.)

I’d have your agent stay in touch with the lender to smooth things along and make sure the lender has all the information he or she needs to make a decision. It’s possible the lender will come back to you (and everyone else) on Monday to ask for another round of bidding. Or, the lender might simply come back and say, yes or no.

Unless you formally withdraw your offer, at that time you can decide whether to agree to purchase the property if you’re given the opportunity.

By the way, I hope you’re using a real estate attorney. Foreclosures and short sales are tough purchases and I’d hate to see you get caught because you didn’t have anyone representing your legal interest in the deal. Unless your broker is also a real estate attorney (and even if he is, he can’t be both to you in the same transaction in some states), you should hire a real estate attorney.

Then, later in the piece, Ilyce fields this question:

Q: My son and his wife are interested in purchasing a foreclosure property as their primary residence. They’re looking for a townhouse because they can’t afford to pay the full cost for a single-family home. Can you tell us what percentage of the foreclosed loan the former owner’s private mortgage insurance covers? When will that be paid and to whom is it paid? Can my son and his wife expect a significant reduction in the sale price of a foreclosed home if the private mortgage insurance kicked in?

A: Private mortgage insurance (PMI) covers the portion of the mortgage that exceeds 80 percent of the purchase price of the home.

For example, if a home buyer gets a mortgage for 90 percent of the purchase price of a home (or for 90 percent of the appraised value of the home if the owner is refinancing) and the purchase price or value is $100,000, PMI would cover the top 10 percent of the loan.

PMI will protect the lender in case the lender forecloses on the home and then sells the home for less than $90,000 but more than $80,000. If the home were to sell for less than $80,000, the lender would have the PMI protection coverage on $10,000, the difference between $80,000 and $90,000, but would take a loss on the sale if the sales price is less than $80,000.

In another example, if the first mortgage is for 100 percent of the purchase price of the property, PMI would cover the lender against a loss over the top 20 percent of the mortgage.

You have to keep in mind that most loans that exceed 80 percent of the purchase price of a home have PMI, but in many cases they do not. If a homeowner obtains a first mortgage for $80,000 on a home purchase valued at $100,000 but gets a second loan for $10,000, this purchase or refinance would not involve PMI coverage.

How does this play out in practice? Right now, all of the companies that sell private mortgage insurance are reporting enormous losses from 2007, due to short sales and foreclosures. Most of these publicly traded companies are reporting their first losses ever.

When someone sells a home for less than the mortgage amount, PMI kicks in and reimburses the lender for the portion of the mortgage that was covered by the loan. So if the mortgage lender agrees to accept a short sale for $10,000 less than the mortgage amount and the loan had PMI, the PMI company would write a check for $10,000 (or a portion of that amount) to the lender, making the lender whole.

But I’ve been unable to find a way to figure out exactly how much the lender is reimbursed by the private mortgage insurer. The good news is that information isn’t relevant when making an offer for an REO property. (REO is industry jargon that stands for “real estate owned,” which means the lender has foreclosed on the property and is the current owner.)

The discount you’re going to get from a lender on a piece of REO property depends on a combination of how much the local real estate market has tanked, how desperate the lender is to unload the property, and how much other homes are selling for in the neighborhood.

You may get a substantial discount, but it won’t have anything to do with how much the lender has been paid by the company who underwrote the private mortgage insurance policy.

Your attorney and real estate agent should be able to help you further. For information on how to identify and purchase foreclosures, check out real estate agent Ralph Roberts’ book “Foreclosure Investing For Dummies.” Roberts, who tells me he has personally purchased more than 2,000 foreclosures, does a nice job of explaining how to identify an appropriate foreclosure, negotiate for it, find the financing for it, and close on it.

Thanks, Ilyce, for the recommendation of my book. If anyone reading this post would like to pose additional questions about REOs, feel free to leave a comment below, or see Foreclosure Investing For Dummies for more information.

As many people know, my family suffered a tragic loss in 2006 with the unexpected passing of our 18-year-old daughter, Kolleen. As a result of Kolleen’s death, many of her close friends became our close friends too, and as a result, part of my immediate and Ralph Roberts Realty family.

One such friend, Mary Kathryn (LaFave) Eckler (a.k.a., MK) and her husband Benjamin, recently graced us with another member of our extended family, Benjamin Dean Eckler, Jr. (pictured here):

While Kolleen’s passing was, and always will be, tragic, it was able to bring together so many wonderful people. From everyone in my immediate family–affectionally known as MaRo and KyRo and KaRo and RaRo–and everyone here at Ralph Roberts Realty, congratulations to Mary Kathryn and Benjamin, Sr. on your new little angel; please continue to share his joy and wonder as he learns and grows (Kolleen would have loved this little 9-pound and 22-1/4 inches long fella as if he were her own, and promptly nicknamed him “BenRo”

Every time the real estate market turns, someone potentially benefits and someone potentially loses out. When property values soar, home owners worry about paying higher property taxes. When values worsen, the end never seems in sight. In the current downturn, the losers are clearly identified as those facing foreclosure or who–because of market, job and credit conditions–feel like they have nowhere else to turn but towards using their house as an ATM machine or selling at a deeply reduced price.

The good news–if you can call it that–is, there are some mighty good deals to be had these days, and one needs to look no further than yesterday’s front page of The Free Press to see what we’re referring to. See the picture of the house below–the one with all the arrows pointing toward it?

Here’s a better picture:

If you had to guess how much this house is selling for–based just on the above image alone–what would you say? $750,000 to $1,000,000? After all, it has:

• 7 bedrooms
• 5 full bathrooms
• 2 half bathrooms
• Living room
• Dining room
• Family room
• Breakfast room
• Florida room / Sunroom
• In-law quarters
• Library
• Partially finished basement

All told, this mansion built in 1905 has over 7,000 square feet (7,187 to be exact), but because of current housing conditions, it is priced to move, and move quickly. Before we tell you the asking price, read the following clip from yesterday’s The Free Press:

Struggling housing market has Detroit’s gems slashing prices

January 19, 2008

BY ZACHARY GORCHOW
FREE PRESS STAFF WRITER

How can you own a house worthy of a millionaire, at a price typical of your standard three-bedroom, two-bath bungalow?

It sounds too good to be true. But in fact, buyers can find scores of historic, large homes available for astonishing bargains — some under $200,000 — in beautiful Detroit neighborhoods, deals that real estate agents say haven’t been this good in decades.

The listings are eye-popping, like the stunning six-bedroom, four-bath, 5,500-square-foot, 1923 colonial in the Boston-Edison neighborhood for $249,500 — about $45 a square foot. Or the five-bedroom, three-bath, 2,700-square-foot colonial in the University District for $149,900. If it’s a Cape Cod you’re eyeing, there’s the seven-bedroom, three-and-a-half-bath, 4,650-square-foot home in Indian Village for $314,999.

But what frustrates real estate agents and owners is the struggle to sell such historic gems — even at these prices. And some have slashed their asking prices by tens of thousands of dollars…

…The real estate market is sluggish everywhere in metro Detroit, and prices have plummeted.
But it’s in Detroit where prices have dropped the most, said Ron Simpson, the outgoing president of the Detroit Association of Realtors… Buyers have long been able to get more house for their money in Detroit than most suburbs, but today’s deals in the city are at “a whole new level,” Simpson said. …

… In the West Village on the city’s east side, when residents learn of someone interested in buying a house in Detroit, they recruit them to their neighborhood by taking them on a one-on-one tour and introducing them to the neighbors, said Bill Swanson, 33, a West Village resident who has conducted some of the tours. Four people have bought homes in the neighborhood in the last year thanks to this effort, Swanson said. “Once you meet people and realize it’s a great neighborhood, it makes buying in the neighborhood really easy,” he said.

Indian Village is another prized area in Detroit. There, a seven-bedroom, six-bath, 7,187-square-foot colonial is listed for $349,995. “A comparable house somewhere else would be millions,” said Joy Santiago, the house’s real estate agent. “It definitely should have gone by now. These are really good prices.”

That’s right… the 7,000+ square foot house referenced above–it’s in the Indian Village section of Detroit–is priced at just $349,995! In many other markets, this historical gem would sell for around $800k to $1 million. Interested in learning more? Here a few additional shots, this time from the interior:

To learn more about this property or others like it, call our office today and ask for Joy Santiago. The office number is (586) 751-0000.