Blog :: 2011

Invest in Your Future with Montpelier and Barre Multi-Family Properties

Welcome 2012 with an investment in your future! 

As the New Year begins, this is a time when many of us recalibrate and take some time to think about how we might improve our lives.  If you have been considering investing in real estate to build for your future, your children's education(s) or maybe for your retirement the options available now are great.

Multi-family residential properties.  These present a tried and true formula for building equity.  Ownership and management of apartments take effort and patience.  In the Capital Region where very little new rental housing has been built in the last 20+ years there is opportunity to purchase properties and upgrade them.  Market demand for nice rentals is strong and supply is limited.

Some potential investors are unsure about financing options to purchase multi-family properties.  The general rule is that properties with four units or less can be financed with a conventional fixed interest rate if one qualifies with a down payment in the 25% to 33% range.

Larger properties with more than four units are treated as commercial properties from a banking point of view.  The implication of this is that mortgages can be approved locally by each banker or lender and are not as likely to be packaged for sale on the Secondary Market.  This gives lenders more opportunity to customize these mortgages.  Often interest rates can be fixed for five year terms but rarely do we see longer term fixed rate mortgage for this category.

At present, the supply of multi-family properties on the market is strong.  The list below indicates how many properties are listed as of the end of 2011:

Barre City - 31

Barre Town - 7

U-32 Towns - 1

Montpelier - 13

Northfield - 10

Waterbury - 4

The variety of types, quality, and condition of these properties provides a potential investor with options at different price points.

A few to consider in Montpelier are:

93 Berlin Street, Montpelier                          2 Apartments              $174,900

55-57 Northfield Street, Montpelier              2 Apartments          $190,000

93 Berlin Street, Montpelier                          2 Apartments              $174,900

17 North Franklin Street, Montpelier             3 Apartments              $199,500

5 Liberty Street, Montpelier                           2 Apartments              $250,000

1 First Avenue, Montpelier                             4 Apartments              $298,000

8 First Avenue, Montpelier                             4 Apartments              $365,000

4 Loomis Street, Montpelier                           3 Apartments              $369,000

242 Elm Street, Montpelier                            4 Apartments              $415,000

Call us for more details on any of these.  We will be happy to provide you with more information or arrange for you to visit and see these.

November Real Estate Market Report--Montpelier, Barre, Northfield, and U32

 November Real Estate Market Report--Montpelier, Barre, Northfield, and U32

Ray Mikus, Broker

Heney Realtors

Here are the unofficial real estate numbers for the Montpelier-Barre area.

  Active in Oct New in Oct Under deposit in Oct Closed in Oct Price Change in Oct Sold Last 12 months
Barre City

69

5

8

2

17

48

Barre Town

67

2

7

7

7

64

Montpelier

52

3

8

5

7

65

U32

61

8

6

6

6

59

Northfield

42

4

4

4

4

22

Totals

291

22

33

24

41

258

 And, comparing to last year...

  Active '11 Active '10 New Oct '11 New Oct '10 Sold Oct '11 Sold Oct '10 Sold Oct '10-Oct 11 Sold Oct '09-Oct '10 Absorb. Rate 12 months '10-'11 Absorb. Rate 12 months '09-'10
Barre City

69

72

5

11

2

7

48

68

1.44

1.06

Barre Town

67

54

2

3

7

12

64

67

1.05

.81

Mplr

52

44

3

9

5

5

65

63

.80

.70

U32

61

64

8

7

6

2

59

64

1.03

1.00

Nfld

42

39

4

7

4

1

22

26

1.91

1.50

Totals

291

273

22

37

24

27

258

288

1.13

.95

 

Going Through the Numbers: Ok , that's a lot of data.  Looking through this, Barre City appears to be the market with the most volatility. 17 price changes in October. Half the new listings this October than last October.  20 fewer sales in this 12 month cycle compared to last year.  Is it the time to buy in Barre City? It looks like it to me...

Another set of numbers worth talking about is the absorption rate. That's the ratio of homes on the market to the number of homes that have sold in the last 12 months. Montpelier's absorption rate is .8 of a year, meaning that right now, there's a nine month supply of housing at the current sale rate.  Overall, in this Central Vermont real estate market, the total absorption rate rose to 1.13 in October, meaning that there's roughly a 13 month supply of housing. I'm not freaking out. You shouldn't either.

 

You Know You're Curious

Real Estate Voyeur: Get your attention with that headline? I've made the analogy before that real estate is like love. It's natural to want to know what an ex is up to. Same thing with a home that you may have looked at online or seen in person.  If you're ever curious about whether a house sold, or what properties have sold for, just call or email. I might know off the top of my head. If not, I'm a pretty good private eye. Curiosity killed the cat, but satisfaction brought it back. For more on this topic, visit the real estate voyeur blog post.

 

 

 

You Just Never Know:  Popular belief is that October is a slower part of the market.  Properties are so individual. Recently, I had a listing that had three offers on it in two days. This wasn't a steal of a property. It was priced correctly in this market, it showed well, and then, BAM. Three offers.

Here's why I tell you this:  Sellers--There are buyers out there who are ready, willing, and able to make good offers. It happens all year round. If you're discouraged, hang in there. You just never know.

Buyers--There are other buyers who are ready to jump into this market. Waiting a few days, or weeks while you eyeball a property won't always work.  If you see something that you like, or if your Realtor tells you about a good deal, be ready to pull the trigger. (And yes, I can tell you when there's a particularly good deal...)You just never know.

October's Closed Transactions

Town Address Ask Price Sale Price
Barre City 58 Blackwell St $54,900 $42,500
Barre City 7 Elmwood Ave $139,900 $139,900
       
Barre Town 11 Short St $99,900 $80,000
Barre Town 442 Websterville Road $134,900 $128,000
Barre Town 20 Hillcrest Ln $149,900 $144,900
Barre Town 193 Richardson Rd $179,900 $175,000
Barre Town 246 East Cobble Hill Rd $219,900 $200,000
Barre Town 31 Barre View St $235,000 $229,000
Barre Town 410 Camp St $329,000 $310,000
       
Berlin 13 Cecile Ave $179,900 $175,000
Berlin 69 Hideaway Drive #9 $226,900 $215,500
Berlin 1433 Darling Rd $795,000 $739,000
Calais 31 Back St $191,000 $191,000
East Montpelier 670 Cherry Tree Hill Rd $296,500 $275,000
Middlesex 441 Center Rd $169,900 $170,000
       
Montpelier 6 Independence $142,900 $142,900
Montpelier 215 Barre St #108A $164,900 $162,900
Montpelier 30 Sibley Ave $245,000 $225,000
Montpelier 13 Terrace St $319,000 $294,000
Montpelier 20 Baldwin St $359,000 $350,000
       
Northfield 1363 Route 12 A $39,900 $37,500
Northfield 28 Riverside Ln $49,500 $37,500
Northfield 1370 Turkey Hill Road $49,900 $46,000
Northfield 528 Turkey Hill Rd $137,500 $115,000

 

Halloween Costume Winners:  This year's contest had lots of great entries. Check them all out at

You Know You're Curious

www.facebook.com/heneyrealtors. Click on the Halloween Costume Contest album to see them.  Relishing my role of arbitrary judge (with Carol helping me, of course), here are the winners:

No Dilly Dallying Award:  Matt and Heather Martin, Kyle and Talitha Landis-Marinello, Jen Sugai

Cutest Baby Costume: Kristen and Phil Whitman (and their Blue Bear)

Best Birthday/Halloween Costume--Believe it or not, there were two entries of people with birthdays right around Halloween--Pat and Steph Smart.

Best Family Costume--Joanie LaPointe and her gruesome family. Please tell me that's makeup.

You Know You're Curious

You Know You're Curious

Don't be a stranger. Call or email if you have any questions about buying, selling, or investing in real estate. Also, if you know anyone who you think would enjoy getting this report, let me know.

Real Estate Voyeur

 

Aren't You Just a Little Curious?

It's ok to admit it. There have been times when you've been curious as to how an old boyfriend or girlfriend is doing. Who'd they end up with? Where do they live? We're not here to judge.

These days, Facebook can let you keep an eye on the people from your past.

But lots of times, people that are looking at homes for sale in Montpelier or Barre have similar curiosity about properties they've actually looked at.  You looked at the house a few times on the internet, maybe you even had a showing.

Then, you notice a month later that the house no longer seems to be on the market. What happened? Did it sell? When? For how much? You're just dying to know! 

If you're ever curious about what happened to a particular property (condo, multi-family, land, or house) in the area, just call or email our office.

The Realtors at Heney Realtors are like detectives. We often know off the top of our heads what happened , but if not, we're good at tracking down the history of properties.

So go ahead and ask. Curiosity may have killed the cat, but satisfaction brought it back.

By Ray Mikus

Interesting Trend: Buyers Looking for Smaller Homes in Central Vermont

Compact Homes

I've seen an interesting trend recently: Buyers looking for smaller houses for sale in the Barre and Montpelier area.

First time buyers and people looking to downsize into smaller homes (two bedrooms, or two bedrooms with an office) have always been part of the natural real estate market in Central Vermont, and the demand for these properties tends to be fairly steady.

A great way to get into home ownership is to buy something that's just the right size. Coming from an apartment, two bedrooms and 1400 square feet might seem palatial.

And it can be. As time goes on and life changes, perhaps more space is needed (bedrooms, home office, yard, etc.). Guess what? There's someone else looking for a great way to get into home ownership. See how that works?

But recently I've met buyers who are thinking ahead to their retirements. They're looking for homes that have the option of first floor living, but that don't necessarily require it. For example, there's a full bathroom and a bedroom on the first floor, but also another of each on the second floor.

"Compact homes", as someone has called them, are not for everyone. But the right ones might give pleasant surprises in terms of energy efficiency, maintenance, and cost.

Halloween Costume Contest!

What's So Scary About This??

It's time again for the Halloween Costume Contest. This year, we're making it easier than ever to enter.

All you have to do is take a picture, and then upload it to the Heney Realtors facebook page. Should be easy to remember...it's facebook.com/heneyrealtors.

Prizes (yes, plural) will be awarded for any number of arbitrary categories. We'll also make an album so that all of our fans can check out the other great costumes.

Note: The first three entries will win the coveted "No Dilly Dallying Prize".

Entries are due by Wednesday 11/2.

So get out there, get creative, have fun, and get your photo uploaded!

Using Equity to Buy Property

It can make sense to use a home equity loan on a property you already own to purchase another property. We've seen buyers use existing equity to make a down payment on a second home, an investment property, or in cases where one person is buying a property for someone else (a child, a parent, etc.).

Use Your Equity

Funds are made available at the issuance of the home equity loan, and then turned around and applied to the new purchase. Buyers can use a home equity loan for the entire amount of a purchase. In that case, the transaction can move almost as quickly as a cash (no mortgage) transaction. Almost. The bank will still require an appraisal of the property being collateralized for the home equity loan. Also, and this is important to remember, there is a MANDATORY three business day waiting period from the time a home equity loan is approved and when the funds can be available. The intention of this federally required rescission period is so that people don't rush into things. As a buyer using a home equity loan, it's important to know that if the closing on the second property is scheduled for the 15th, the closing for the home equity loan has to be by the 12th (assuming that's a business week). There's just no way around it.  You can't waive or sign off on that right. You've just got to wait the three business days.

So, anyone thinking of using accumulated equity in an existing property to purchase, or help purchase another property, just remember to pad in that extra time.

  For more details, call or email.

By Ray Mikus

October Market Update--Check Out the Numbers

October's Unofficial Numbers--By Ray Mikus

  Active New In September Closed In September Under Deposit Price Change
Barre City 80 7 3 7 21
BarreTown 77 15 7 9 10
Montpelier 64 11 6 7 8
U-32 74 4 8 12 11
Northfield 43 4 0 5 9
Totals 338 41 24 40 59

And comparing to a year ago ...

  New To Market September 2010 New To Market September 2011 Closed September 2009-September 2010 Closed September 2010-September 2011
Barre City 14 7 67 51
BarreTown 9 15 62 64
Montpelier 5 11 67 66
U-32 9 4 65 64
Northfield 7 4 26 18
Totals 44 41 287 263

 

Clusters

For all the talk about the decline in sales, and the state of the real estate market, look at how tightly clustered sales have been in this area. Barre Town, Montpelier and U-32 all had nearly identical 12 month sales in 2009-2010 and 2010-2011. Barre City and Northfield, well, the number of sales were down.

But don't think that sellers in Barre City and Northfield aren't aware of that. Look at the number of price changes this month in those two markets. Sellers who are staying in the market are going to sell their houses. Those that are testing high prices have gotten their answers. No jumping to conclusions! There are houses that are priced correctly and are still on the market.

Gettin' Smart

I recently had a great opportunity to expand my professional knowledge at the annual Vermont Realtors' Conference in South Burlington. For two days, I took courses and networked with some great people, including the President of the National Association of Realtors Ron Phipps and the Government Affairs Director for the Vermont Association of Realtors Chris MacDonald.

Just about everyone from our office was able to attend and take courses. I took a specialized course on property evaluation (residential and investment), a course on the new RESPA requirements and a course on cooperative and effective negotiation. All in all, it was a great two days. I did miss being in the office, though.

Fast Movers

Recently, our office has had two properties that were listed and then within days went under deposit. That tells me that buyers are hungry for properties, and that when they find the right one, smart buyers aren't wasting time. In both cases, the buyers were able to move fast and were able to get ahead of other offers. Getting the inside scoop from a Realtor who really tracks the market helped these folks immeasurably.

Most Improved Player

This month's most improved player award goes to 58 Wheelock Street in Montpelier. The first time I saw the house, I made some recommendations on how to make it show better to buyers. I always do that to help my sellers. But these sellers took my advice and ran with it. They took up carpet to expose beautiful hardwood floors, took off, um, "vintage" wallpaper in the dining room and, er, "antique" wallpaper in the upstairs landing. Both of those are now a crisp, clean white. The house is breathtaking. Like I said, most improved.

Low Lying Fruit

Investors looking to add to their portfolio of multi-family properties are in one of the best markets in years. Rents for apartments have remained steady over the course of the economic downturn, but prices have come down significantly. Plus, there is a great supply of investment opportunities. Owner occupied multi-families can get in with 5% down and 80% of the rental income can count toward financing ratios. Talk to me or a lender for details. Non-owner occupied still needs 20% down in most cases. There are deals out there. I'm happy to help you run numbers and find some tasty properties.

  Active Multi-Family Properties Closed In Last 12 Months
Montpelier 15 3
Barre 39 4

 

Are you kidding? With cap rates in many cases exceeding 10%, low interest rates and stable rents there are some buys out there in the multi-family investment property market.

September's Closed Transactions

Address Town List Price Sale Price
28 Fairview St. Barre City $115,000 $105,000
8 East Parkside Barre City $124,900 $119,000
1 Waterman St. Barre City $165,000 $158,000
       
98 Miller Road Barre Town $109,900 $115,000
111 Websterville Road Barre Town $134,900 $136,900
325 Beckley Hill Road Barre Town $156,000 $148,000
27 Waterman Barre Town $165,900 $159,000
5 East Street Ext. Barre Town $180,000 $170,000
79 Cassie Street Barre Town $169,900 $174,000
731 Graniteville Road Barre Town $80,100 $76,000
       
141 Vine Street Berlin $225,000 $228,000
104 Highland Avenue Berlin $250,000 $230,000
62 Route 302 Berlin $129,500 $122,700
       
50 Mugford Rd. East Montpelier $28,500 $26,500
500 Rt. 14S East Montpelier $115,020 $115,100
       
10 Dolan Road Middlesex $208,000 $200,000
194 East Hill Rd Middlesex $300,000 $300,000
136 North Bear Swamp Middlesex $195,000 $194,500

Closing Costs? The Bottom Line

Buying a house in Central Vermont isn't free. But there shouldn't be too many surprises either.  One question that people often have is "What are the closing costs?"

Think of it in two parts:  Process costs and the closing costs.

 

Process costs include home inspections, water tests, loan application fees, and appraisals. $400-$1000 is a reasonable range depending on the complexity of the property.

Closing costs typically include the Vermont Transfer Tax, loan origination fees, attorney fees (title search and title insurance policy), tax and fuel perorations, and recording fees.  The transfer tax depends on the value of the property. Tax prorations depend on when in the town's tax year cycle the purchase takes place. Fuel perorations depend on how much oil or propane is left in the tank at the time of the purchase.

Very roughly, figuring 3%-5% of the purchase price for total closing and process costs is a good place to start.   Again, that's a ballpark number.

Give a call or an email for more detail.

By Ray Mikus

Finding that Perfect Home

Your Perfect Home?

Sometimes finding the perfect home in the Montpelier/Barre area is like falling in love. You can't describe ahead of time what you're looking for, but when it hits you, you know. I'm a romantic at heart, but more often, there's some real thinking and list making that goes into finding the perfect house. Usually more than with falling in love. Usually. It's a good idea to go through these lists with everyone who's going to have a say in the homebuying process. Some buyers like to go through this exercise separately, and then see how they compare. It can be interesting to see what's important to different people. (Wait--why do we need a third bedroom??) Here are some key things to keep in mind when looking to buy a home in the Montpelier area. With each of these, think about not only if they're important, but how important. Could you live without a first floor laundry, but simply not even consider a home that doesn't have a master bedroom? Location 1. Town--Which town(s)? 2. Distance--Walking distance to town, bicycling distance, or out in the country? 3. Yard--How much yard or land are you looking for? 4. Schools--Which school districts do you want? 5. Amenities--Is having paved roads, or town water and sewer important to you?

Type of House 1. Construction--wood frame, log home, manufactured, etc. 2. Condition--well-maintained, some deferred maintenance, fixer upper? Another way to think of this is to think of your preferred tools: Sledge hammer and respirator? Paintbrush and screwdriver? Leather sofa and lemonade? 3. Style--single family, multi-family, 1 story, 2 story, cape, colonial, raised ranch, manufactured, farmhouse, Victorian, yurt, etc. 4. Garage--attached, detached, 1 car, 2 car, shop, heated, etc. 5. Basement--finished, finishable, neither? 6. Porch? Deck? Sunroom? 7. Any special requirements for out buildings? 8. Age--new, mid-century, older, very old

Features of the House 1. Size--approximate square footage 2. Lifestyle--what's important to you? Entertaining guests, large bedrooms, separate spaces, etc. 3. Kitchen--eat-in, updated, level of finish 4. Dining Room--formal, informal, kitchen-dining combo 5. Bedrooms--number, size, 1st floor needed, master suite, any special furniture needs 6. Bathrooms--number of full, half, etc. 7. Accessory Unit--in-law apartment 8. Any special storage or closet needs? 9. Laundry/mudroom--1st floor laundry needed? 10. Fireplace/Stove 11. Heating System--oil, gas, wood, hot water, hot air, solar 12. Electrical System--any special requirements? 13. Plumbing--town water and sewer or well and septic tank?

Price Range--Think about a down payment and a mortgage. If you haven't talked with a lender yet to get pre-approved for a mortgage, go ahead and get started. We can give recommendations for good local lenders. Price is important. A wise person once said, "The perfect house is the one that's just out of everyone's price range." True! Not knowing what you can and want to pay for housing is going to result in a confused property search. The best thing to do is to run through your numbers, and get a solid idea as to what price range you're looking for.