If you are paying Cash for real estate, especially here in in a high cost area like Westchester, I have some advice as a broker who has worked with many cash buyers. First, congratulations on havng the recources to pay cash. You are blessed.

Here are a few steps that will help you in your efforts.

1. Get a statement for the account with the funds. It can be printed up from your online account, gotten from your bank branch or financial institution, or one of the statements they mail out periodically. 
2. Get a sharpie or magic marker. 
3. Take the sharpie or magic marker and black out your account number. Photocopy the document. 
4. Give the copied document to your agent so they submit it with your offer. 
5. If steps 1-4 won’t suffice for some unfathomable reason, a letter from your personal banker, CPA or attorney stating that you have the funds in liquid form will do. This is frankly, more work, but it will suffice. 

If you haven’t met Paco, you’ll be hearing about him on the news. Paco is the little rescued Chihuahua who chased armed robbers out of his master’s store. He didn’t care that they had a shotgun or dwarfed him, he still barked his head off and chased them out of the store like they were dinner if he caught up. 

Paco didn’t rest on his laurels or tell the robbers what he did in 2006. Paco didn’t tell his master to let the lawyers work it out. Paco was indifferent to the odds. He took matters into his own paws charge. 

My old head rowing coach in college, Tully Vaughan, always said this: “Crew doesn’t build character. It reveals character.”  Character is just something you have. You don’t learn to pull Excalibur out of the stone, you can or you can’t. You don’t work up to holding the hammer of Thor at the gym. You either belong in Asgaard or you don’t. Here’s what you don’t know about someone until you do know- whether they have the heart of a wolf or a chihuahua. Paco has the heart of a wolf. 

If I seem overdramatic about some dog barking at strangers and probably not knowing what a gun even is, perhaps I am. But I have a soft spot in my heart for the diminutive and the underdog. Being a shorter dude myself and often underestimated, I eat this stuff up. I have been a giant killer since the days I opened my firm for business. 

Dogs don’t understand fanfare. They understand belly rubs. If Paco could speak, he’d just say he was doing his job. 

To me, the take away is to do your job with Paco’s faith and you’ll kill giants. To consumers, there is also a lesson- biggest isn’t best. The agent who’ll do the best job for you may not work for the swanky label, they work for the result. My boss is a collective of 4 with a combined age of 26. There isn’t much I wouldn’t do for them. 

Go out today and make magic. 

Some bonus inspiration:

Raw surveilance footage of the event on the owner’s Youtube account. 
Heather Dorniden’s amazing comeback. (hat tip to BLiz Spear)
People are awesome.

I don’t often blog about listings because I focus more on commentary here, but I think the walking tours we now do for our listings are very appealing. I do them Bob Vila style, with a candid, conversational walk through as if we were chatting together touring the house. I don’t use a script, so where language limps I add an annotation for clarity or to flat out correct myself. 

We just listed this home, and I think you’ll find that the tour will pique your curiosity to see the place, not just for what the walkthrough shows, but also for what it does not show, such as the pond on the other side of the grounds. 

Price taxes, and other specifics are on the walk through, and if you dig the place or have questions, give me a call or send an email. 

This is a beautiful home in Philipstown with a small pond, lovely grounds and considerate owners, and I believe that it is priced right as well. Enjoy my nasal voice. 

Somers is near and dear to my heart. I went to high school here at John F Kennedy Catholic. The area is located in northern Westchester County and is very wooded and pleasant, with the NYC reservoir system running along much of its eastern border. Appearances can be deceiving: There is quite a bit of industry here, with huge complexes for both IBM and Pepsi hidden from street view on bucolic campuses. Somers also lays claim to being the cradle of the American circus, with the high school mascot as the “Tusker” and town hall at the Elephant Hotel. 

The real estate market is also active.The following is the market activity for the 2nd quarter of 2001 for single family homes taken from the Empire Access MLS. 

This past quarter, 26 homes sold at a median price of $538,500. 

For the same period in 2010, 33 homes closed at a median price of $585,000. 

Given the effect of the Stimulus on 2010 stats, Somers should be considered very stable. 

There are 19 homes under contract at a median price of $475,000, which suggests that the lower priced sector is having more activity than more expensive homes. 

137 homes are active at a median asking price of $580,000. 

No mention of Somers would be complete without also noting Heritage Hills, the huge condiminium community here, which has the bulk of 69 units on the market at a median list price of $369,000. Last quarter there were 22 condo sales closed at a median price of $372,500. 

To find a home in Somers online, get yourself a free Listingbook account and search the MLS like an agent. 

Located in northwest Westchester County, the Hendrick Hudson School district is in the town of Cortlandt and encompasses parts of Croton, Cortlandt Manor, Peekskill, and all of Montrose, Verplanck and the village of Buchanan. All information is for single family homes from the Empire Access Multiple Listing Service. 

For the 2nd quarter of 2011, 11 home closed at a median sale price of $495,000. 

For the 2nd quarter of 2010, 21 homes closed at a median price of $369,000. 

I see a little bit of supply/demand dynamics here- fewer homes are selling with higher prices. More homes sold last year at lower prices. 

16 homes are under contract at a median asking price of $402,500. If they close in the next 45 days, we’ll be looking at a market that is more like 2010 than last quarter. 

97 homes are active and available at a median asking price of $451,000. 

The area is holding its own. Inventory is quite high, and that will suppress prices. When prices do go down, transaction volume will go up. 

Previous posts on Hen Hud schools are here. 

Find a home in Hen Hud schools with a free Listingbook account. 

Pleasantville’s real estate market for the second quarter of 2011 is an analysis of single family home activity for the period April 1, 2011 to June 30, 2011 for the Pleasantville school district. All information is derived from the Empire Access MLS. 

For the second quarter of 2011, Pleasantville had 12 closings at a median price of $445,000.

For the same period in 2010, there were 13 closings at a median price of $535,000. 

That is a significant drop in median price. To appreciate how far down prices have come, in 2004, there were 22 closings at a median price of $647,500. From the peak, Pleasantville is down over $200,000 in median price. 

There are 72 homes for sale now at a median asking price of $604,200. That is almost 2 years of inventory. 

The light at the end of the tunnel for the area is on the homes currently under contract: 9 homes are under contract, and they have a median asking price of $719,000. 

Remember, we are measuring quarters here, not single months, so the likelihood of an anomaly is far smaller. That high median price for the contracted homes is real, it is significant, and it is good news. 

Previous postings on Pleasantville.

Find a great home in Pleasantville on Listingbook. 

The Westchester Putnam Association of Realtors has released their 2nd quarter report for the two counties real estate sales. It’s valuable data, and I thought I’d do something a little different- namely, take the entire first half of 2011 and see how we are stacking up with the first half of 2010. 

Here’s the scoop for single family home sales, county wide, for the period from January 1 through June 30, 2011 from the Empire Access MLS:

1710 single family homes have sold at a median sales price of $592,475. 

Here are the numbers from the first half of 2010:

1958 single family homes sold at a median sales price of $604,250. 

While we’re down 248 sales, there is reason for optimism, because much of 2010 was fueled by the artificial effect of the tax stimulus, which poached deals from the future and never did any real good from my point of view. The 4th quarter of 2010 was miserable. So, if 2011 is more consistent than the up and down of 2011, we still have a chance to compare well to last year. 

But, thus far, no matter the reason, we’re down both in volume and value. 

The first words of M. Scott Peck’s seminal book The Road Less Traveled are “Life is hard.” It was actually required reading in a senior elective at Villanova back in 1988. I thought of it yesterday as I was driving and I snapped the shot below, a sight all of us in the industry are familiar with: the road. It was hard not to take the photo- what lay ahead seemed to go on forever, framed by a pretty blue sky that seemed indifferent to my thoughts and concerns. 

Real estate, like life, is not easy. It is my career, my vocation, and it is what feeds and clothes my family. And right now, the industry is in a downturn with no short road out-it is what it is. However, like driving, I like it. And the times that it is “easy” or at least not difficult, are those times when I don’t resist the hard parts. 

I think that all of us in housing know this. It’s difficult when it is difficult, and it’s easy when it is easy. We just keep driving forward, eyes on the road and hands on the wheel, engaged, paying attention, and hopefully appreciating what we behold on the way. 

I hate to rain on a guy’s parade.

As a colleague from another industry sat across my desk, we pondered why his home, listed with another broker prior to meeting me, had not sold. Looking at the market activity, his bottom line and what it appeared he’d get were about $10,000 apart. My suggestion was to lower his price and be done with it. He was not excited about that prospect, and said he was considering renting the place until the market turned around. Among the first questions I asked was what his cash flow position would be if he were to lease the place. He thought it would be about $500, which would be a $6,000 annual profit. 

God bless him. 

Having done the landlord thing I knew that if the surface appearance of $500 positive cash flow simply compared rent minus mortgage, my colleague was in for a rude awakening. So we teased it out, and to his credit, he approached the discussion with earnestness -no easy task when it’s your place. 

Here’s a summary of what I told him could happen to that $500 every month, assuming *100%* occupancy. 

• Insurance. You have to convert your policy to a landlord policy for a non owner occupant. Does that raise or lower the premium? I think we know the answer there. 
• Water bill. Tenants don’t pay the water bill in a condominium, the landlord does. Who uses more water, renters or owner occupants? I think that answer is also fairly obvious. 
• Taxes. While they are often already in the mortgage, they tend to change in one direction only here in New York: up. 
• Routine maintenance. My friend is selling because he is buying a bigger home for his family. His new home with have a furnace, central air, plumbing and electrical systems which will require routine care. So will his old home. That fixed cost will double, unless you like living dangerously and don’t peform routine maintenance on the systems in a tenant occupied home. Which leads us to…
• Big Ticket items. A landlord with $500 cash flow is better known as a landlord who is one new furnace away from having his year’s profit decimated. The same goes for the central air, and things like water heaters and garbage disposals also chip away. You wouldn’t believe what tenants flush down the toilet and put in the garbage disposal. Plumbers aren’t cheap. 
• Tenant foibles. Like the great Derek Jeter, some things don’t show in the stats- you have to tell the story. Such as the following: 
  • Tenant: The dryer is broken!
  • Landlord: But it is 2 only years old
  • Tenant: It won’t heat up! I can’t dry my clothes! You have to fix it!
  • Landlord: I’ll be right over…
    Sure enough, the dryer won’t get warm. Until the landlord pulls out the lint screen, which by this time has a family of alpacas stuck to it, because the tenant never owned a home and always had a coin laundry back in their apartment in Yonkers. Yippee. 
    The landlord rationalizes he did not have to pay a repairman, and tries not to think that his quiet evening with his family is wrecked, or his tenant is a doofus. Kumbaya. 
• Wear and tear. Tenants have been known to punch holes in things. And they put flooring and painting contractors’ kids through college. Replacing carpeting eats away at cash flow. So does replacing broken windows floor tiles, and garage door openers. Trust me.
• Guests. Lovers. Grown kids and extended family. None of whom are on the lease, but often visit and never leave. And they have no accountability to you, but the neighbors notice. These are the hole punchers. 
• Pets. I could write a book on this one. Cats especially, for some reason, but say goodbye to the carpets. And yes, you’ll be repairing th hardwood too. And oh. That. Smell. 
• Security Deposit. Yeah, they’ll try to use that for the last month’s rent in some cases. Sorry. 
• Quality of life. Then there is the being joined at the hip to people who punch holes in things, run the furnace like it’s a rental car, run the water like they are baptizing the Philistines, and sometimes may not pay their rent on time or return phone calls. If you’ve ever waited in your car at 9pm waiting for this son of a person to get home so you can ask where the missing money order is, you’ll know it’s not cool like in the Sopranos. 

For $500 a month? No, try for NOTHING. Especially if you are in the 40% tax bracket. Here’s a better idea: If you want to get $500 a month extra, wait tables on the weekends. 

I topped out at 14 units 8 years ago, and I still get jitters when I hear the phrase “lot line cleanout.” If you are moving out of town, you’ll need to pay a property manager, which also effects the bottom line. Think about that if you are relocating from Westchester to Jebip. My colleague needed a far bigger margin or to just lower the price and sell it. 

If this sounds antithetical for a broker to talk folks out of real estate investing, it isn’t. I deal with professional investors, not weekend warriors, because the late night infomercials are a lie. 

I sleep better at night. I hope my friend will now as well.