Spyglass Realty 2nd Quarter Austin Real Estate Newsletter

Well, the July market stats are out (see link below) from the board of realtors and its a mixed bag all across the board. Overall, through the entire MLS, the median home price is up, year over year. This is because the under $300,000 price range continues to flourish. Its the most sought after price range in the city.

If you look at the sales numbers throughout Austin, central Austin shows a substantial decrease in sales over last July. Some areas, including Westlake, the Southwest Parkway corridor and 78704 show an actual decrease in property values. Before you look too deep into these numbers, know that much of this is due to a small sampling of data. Area 6 is the part of 78704 east of Lamar. This is an interesting area because there is SO much of a difference in price ranges between the northern part and southern part, that if more properties sold in the southern part, the data can be skewed. So much so, that I think this should be divided into two new MLS sections that I would label 6N and 6S, with the dividing boarder being Oltorf. The average sold price in this section decreased by .5% for properties that were in the same square footage range. I think if we narrowed this down, you would see that many more properties sold in the southern part of area 6 than the northern part and the norther part, which led to a data report that is hard to interpret.

Looking at area 7 (the part of 78704 west of Lamar) you see a substantial decrease in value. The median home price shows to be down 22.8% over July of 2013. Now in this section, not only is the data sampling small (only 11 homes sold in July of 2014) but the size range of the homes is dramatically different. In 2013 the average square footage was 1581. In 2014 its 1062, a staggering 32% reduction in the size of the homes sold. The average price per square foot is actually up 11% from $323 in 2013 to $359 a foot in 2014.

Still, its a mixed bag of information. As you will see in the below article link, July showed to be the first month of increase inventory in years. So people keep asking “whats going on here?” The amount of people moving to Austin does not seem to decrease and the headlines for companies moving to Austin and hiring hasn’t slowed down. My theory is that people moving to Austin have heard about the crazy market we’ve had here in the 24 months preceding June and they are being very cautious as to how they enter this market, if at all. Many would-be buyers are electing to rent instead of buy.

You see in the past 24 months, many sellers would look at a comparative market analysis and decide to price their property some 3 to 5, and in some cases even 10 percent above the highest comparable home that sold. And shockingly, it did sell. Buyers were willing to make up the difference between appraised price and contract price. Well with this recent slowdown, such tactics aren’t going to be successful. Can you sell your home in 2014? Of course, but you have to be reasonable.

If you are buying or were in the process of buying, this gives you a unique opportunity (compared to the previous 24 months) to enter into a market without the insane competition that we saw in 2013 or the early half of 2014. I believe that we have seen most (if not all) of the appreciation we are going to see in 2014 already.

I recently evaluated some properties in 78704. A property there sold for $449,000 in March in just 6 days. There are currently two actives on the same exact street and they are almost identical models. They have 51 and 73 days on the market, respectively. They are priced between $440,000 and $450,000 and sitting. But they were originally priced in the 470,000 range. I personally believe that had these sellers priced their homes in the range between $445,000 and $449,000, they would have sold within the first two weeks at, or close to, list price. But now they have a stale listing, and a savvy buyer will take advantage of this to get a price some $10,000 below what it should have been priced at.

I can tell you that I have lost out on a couple of listings recently to other agents that agreed to price listing at rates that were way too high. When I see them hit MLS, I breath a sigh of relief that I did not get that listing. Slow and steady wins the race, folks.

The take-away: if you’re a buyer, this is good time to get a decent deal compared to the 24 months preceding June. If you are seller, you can still sell, you just have to be reasonable with your list price. Don’t let greed lure you into selling your home lower than you should ultimately be getting. The DYI pricing program is over. Now more than ever do you need a qualified and service oriented agent. And, if you are reading this, well guess what? You’re on the right track :)

If you have enjoyed this article and want to keep tabs on whats going on in Austin, like our Facebook Page by clicking that link.

We have some great articles below.

Texas inventory is up for the first time in years. – Check it out.

If you have lived in Austin for a while, you probably have heard people at some point saying that Austin is losing its identity with its growth. Well, thats song has been played for nearly 30 years now. Check out this article showing that people have been worrying about that since 1983. 30 years later and we still love it! Story here.

Alamo Drafthouse South Lamar and the Highball are finally reopening, and what a reopening it is! The Greatest Karaoke Bar In The World. The End.

And, finally, here are the Austin real estate stats for July, 2014.

What happens if my Texas property does not meet appraisal?

I recently worked with a home buyer that asked this question on a property he was buying, worried that it would not appraise.

It impacts everything. The buyer has a complete out if that happens. There are four ways that that can go down:

  1. The seller drops the price to meet appraisal price
  2. The buyer brings in over and above whats needed to meet value
  3. The Seller and the buyer meet in the middle
  4. The contract is canceled and you go your separate ways

But no matter what way it goes, the buyer’s earnest money is protected. A couple of years ago I priced a downtown condo at $299,000 and about we got a full priced offer on it. Well, about a week after the property went under contract a similar unit closed at $295,000. The appraiser gave us a value of $296,000 and my seller agreed to drop the price to $296,000. But the buyer was getting cold feet and, in an act of pure lunacy, submitted through his agent that he would move forward with the property if we lowered the price to $275,000. Seller’s can lower the price to appraise value, but buyers are NOT obligated to purchase the property if they don’t want to. Well of course we sent him a rejection and listed and sold the home within days at $296,000.

Many consumers (and some agents) believe that the date on the third party financing addendum is the date that the buyer needs to have his appraisal complete and back in order to get his earnest money refunded.  This is simply not true.  In the example above, appraisal came in 4 days before we were set to close and days after the third party financing period expired.

Appraisals in Austin can be especially difficult in hot areas where few properties sell and there is a lack of data for comparable properties with about the same square footage. You see, appraisers have to “bracket” the property with comps that have square footage of 200 above to 200 below.

I have been very lucky (and skillful to some degree) in my listings because if I have any doubt there will be an appraisal problem, I change the access instructions to say “appointment with agent” and then put on MLS that there is no lockbox, even though there might be. The point of this is to make the appraiser go through me to access the property, that way I can go over pricing and what comps I use.

I’ve been doing this so long that every now and then I get an appraiser that say “Ryan I’m doing an appraisal on one of your listings, whatcha got?”. And now a days appraisers are required in many instances to reach out to listing agents for the past comparable properties and ask about the house. Some listing agents see this as a nuisance to have call an appraiser about a property that is already sold. I see this as an opportunity to build good will with an appraiser that could very well be the appraiser on my next listing.

No, a personal relationship is not supposed to effect the outcome of an appraisal. But, it sometimes does, especially if its right on that line of meeting value or not. This is a relationship business and it pays to build a relationship with each and every person you meet in this industry.

Feel free to call me at 512 965 1480 if you have questions about this.  Or email ryan@spyglassrealty.com.

Brewed in the Heart of Texas


It’s an old friend, a new love, a daring adventure, a celebration of special events, a bonding moment, a refresher on a hot day or a hearty feast on a cold one. Beer is one of the most popularly accepted alcoholic beverages and is the third most fashionable drink after water and tea. They come in different types and can be categorized according to the color, ingredients and alcohol content. These altogether are known as beer styles, which continues to vary due to the weather and climate of their brewery location. This guide highlights the darlings of the local Central Texas beer world. An industry in a category of it’s own, reflecting the
style, culture, climate and eccentric personality of Central Texas.

Click here to download the guide.

Why You Shouldn’t Sell Off Market

As you know, this market is red hot. For most sellers, the question remains, “What separates a regular agent from one who stands out and what can a stand-out agent do to increase my odds for a higher price in a shorter amount of time?”

In our quest for differentiated value, we’ve studied the techniques of top producing agents around the country and have adopted the ones that we feel are most productive to our clients.

I see properties that are pending on sites all the time that never hit the market. There are obviously rare cases where this will be beneficial for the seller, such as not wanting a bunch of people in the house or for privacy reasons. But in this market, if you do not expose the property to the masses (by way of MLS), there is a good chance that the seller is leaving money on the table.

We go to great lengths to expose our listings to the public, long before a property is listed. We use Zillow and Trulia, Facebook and Google adwords (all run through professional advertising companies), and we also push the properties out through our vast network of top producing agents. The difference between us and other brokerages is that we rarely (unless instructed) allow the buyers or their agents to preview the property until its listed on MLS. We drive demand to the property and collect names and numbers of potential buyers and their agents so that, when the property is listed, we have the potential for several offers at once.

By not allowing pre-views of the property before it’s listed, we prevent the seller from feeling pressure to sell before the market has a chance to react to the listing. We firmly believe that the only way to affectively market a home is to provide a strong pre-MLS advertising package. We’ve yet to see one that provides as much coverage as the package that we employ.

I’d be happy to go over this with you.

Austin the Shining Star

Austin, the Shining Star of the National Stage

You’d have to live under a rock to not know that the housing market in Austin is hotter than ever. Don’t be fooled into thinking that the rest of the country is faring as well as we are. Yes, they are doing well, but with the latest unemployment numbers hitting 4.4% in Austin, we are the shining star in the real estate national stage.

So it brings us to the question that I get on an almost daily basis: If I sell my home, where am I going to go? That’s a great questions. I’ve been fortunate enough, these past couple of years, to be in a position where I work 60% to 70% listings compared to buyers. Many of my sellers, for one reason or another, are moving out of Austin. That’s’ great for them, in the sense that they don’t have to try to fight this market, but if you are selling a home in 78704 and trying to downsize, that’s where you get into the madness of multiple offers. It boils down to this: the cheaper the home (for the most part), the harder it is to acquire. Special consideration to where you are going to go needs to be made before you even list your home. If its downsizing, you need to be prepared for the possibility that you are going to have to fight for that home.

As an avid Dave Ramsey follower, I have, in past years, been extremely reluctant to advise my clients to buy BEFORE they sell their home. That’s not the case any more. With current market conditions, I now believe you would be in better situation by buying first. Obviously there are risks and we do our best to put a plan into place to mitigate those risks. But now more than ever are those risks tolerable.

If you are upsizing your home, things get better. The higher the price point, the smaller the pool of buyers. It’s still no cake walk, but we see less multiple offers the higher the price range a buyer is looking in.

If you are considering selling a home and want to talk about the plans we put into place to help you navigate these issues, feel free to call me for a consultation.

A Family’s Guide to 78704

When it comes to parks, the first thing people think of is Zilker Park because it’s, arguably, the best park in the city. Zilker’s massive playground includes activities for all ages as well as the Zilker Zephyr – a miniature train that runs daily from 10AM to 5PM. There are also 358 acres of parkland for activities such as kite flying, soccer and ball games. You can rent a canoe in various locations for about $12 per hour and you can buy bird seed for feeding the pigeons at the Zilker Zephyr.

Nestled within Zilker’s massive sprawl lies Barton Springs Pool, a natural springs pool fed by the Edwards Aquifer. There’s no better place to cool off during the hot summer months.

If you’re looking for a little shade, or maybe just to get away from the crowds of Zilker, Little Stacy Park (located on Alameda, just south of the river) might be for you. The park has a free wading pool, playgrounds, covered picnic shelters and restrooms. A great place for kids!

Splash pads? 78704’s got ‘em. There are two parks that include this very popular feature. Ricky Guerrero Park, (located on S. 6TH) and Butler Park (formerly Town Lake Park – Located on Barton Springs RD).

What a lot of people don’t realize is the shear number of parks in 78704. There are over 30! Even the parks connected to schools are available to for public use. Little Zilker Park, also known as the Zilker Neighborhood Park, adjoins the Zilker Elementary School. The neighborhood community has recently completed many improvements to the park and has a full five year plan for even more. Then there’s Big Stacey Park which is connected to Travis Heights Elementary. Big Stacy Park includes a well sized, free-admission, swimming pool complete with swimming lanes and a deep end suitable for diving. Big Stacy even connects to Little Stacy through the very walkable and family friendly Blunn Creek Greenbelt area.

There are more family friendly locations than just parks in 78704. Many restaurants in the area, not only make themselves kid friendly, but go out of their way to create welcoming family environment.

Freddie’s Place, in the Bouldin Creek area, features American comfort food – made from scratch – in a backyard atmosphere. There is music, washer pits and even a playground for the kids.

Phil’s Icehouse, the self-styled “Happiest burger joint in Texas”, is located on South Lamar. Phil’s has both indoor and outdoor seating, plenty of space for the entire family, and outside, you’ll find a wonderful playscape.

These are just a few of the family friendly spots in 78704.

Now Distributing to Bouldin and Travis Heights

Spyglass Realty has been working the West section of 78704 for several years now. We are excited about our expansion into the rest of 78704.

If you haven’t heard of us, we provide a series of services that most other agents don’t employ, such as complimentary staging and advanced pre-marketing. Our goal was to keep our focus to West of Lamar and South of Oltorf, mainly because there were already long-time brokerages that were focusing on Bouldin and Travis Heights. That has changed.

Throughout the years, we’ve seen some of these long-time agents retire or move out, leaving a small handful of “specialists” in Bouldin and Travis Heights.

Because the majority of our business is in 78704, and because we dominate the search terms in these areas, we get a a lot of calls from buyers and sellers in this area. It’s not like we were omitting Bouldin and Travis Heights, we just weren’t mailing to these areas yet. What we found was that a majority of the agents who were selling in this area were not even located in this area. And we also found working with buyers, that the listing agents who were prominent in Bouldin an Travis Heights who did live in this area, not only didn’t employ ALL of our techniques, but also lacked some of the common services that you would expect to see from just the basic, run-of-the-mill agent. We had an occasion where a long time “player” in Travis Heights wouldn’t return our call on a listing that had been on the market for 2 months!

We then saw a real space in these areas for a service-oriented company such as ours. And here we are. Now we are sending our quarterly newsletter into the areas of Bouldin and Travis Heights. If you aren’t familiar with us by now, keep an eye out. We have marketing techniques that aren’t employed by any other agent in the city (yet) and you will soon see our unique ads at a lot of uncommon locations.

Our goal, when listing a property, is to bring the attention to that property days and even weeks before it’s listed. We drive traffic to a property pre-MLS but we don’t sell the property (unless otherwise instructed) until the property hits MLS. This is how we get the highest and best price for our seller and we are able to negotiate the best terms for our sellers to combat issues like appraisal and canceling during the inspection.

For buyers, we are able to find properties pre-MLS through our network of other top producing agents (as a top 50 agent years-running, I do a lot of networking). And yes, if you are selling and looking to move elsewhere, we do work outside of 78704.

78704 is where we call home so this is where our advertising is focused.

How to Structure an Offer

How to Structure an Offer in a Competitive Multiple Offer Situation

Once you’ve sold a property (or before in some cases) you have the daunting task of trying to secure the next property that you will be moving to. Again, through national networking, we have devised a system of best practices for our buyers to structure an offer that gives them the best possible chance of securing that next property.

  • 1. You don’t have to give up your due diligence to write an aggressive offer. As a listing agent, I see multiple offers all the time with 10 days for inspection period. Our inspectors are on stand by and we can often get an inspection with 2 or 3 days of executing a contract. That gives us plenty of time to review the inspection report. A hefty option fee ($500 or more) can also go a long way to instill confidence.
  • 2. Write low days for financing contingency. This is a big one. I see agents putting 20 to 30 days for the buyer to obtain financing before the earnest money goes hard. We work with the number one volume producer of loans in Austin and he vets our buyers BEFORE he writes the pre-approval letter. If the buyers finances are solid, then they don’t need 20 days. The financing period can be over and if the property doesn’t appraise, the difference between contract price and appraisal price can still be negotiated. Also, because our lender does so much business in Austin, his pre-approval letter carries weight among top producing listing agents. Recently, we have put ZERO days for financing contingency on several of the offers we have written for multiple offers.
  • 3. Putting a contingency in the contract for a difference in appraisal price OR the removal of the appraisal contingency all-together. There are implications about this that you may want to seek legal advice for, but I have seen, on several occasions, offers that outline the difference the buyer would be willing to bring in between list price and appraisal price. It doesn’t make much sense to offer 10 to 30 thousand over list price if the property has no chance of appraising at that price. A listing agent and seller are going to want to have some confidence that the buyer will be able to make up all or some of the difference if the appraiser doesn’t bring the value in. Obviously the buyer has to have a strong grasp on what this would do to his finances or this isn’t an option.
  • These are just three of ten different techniques that we use when working with buyers to help them secure a property in a multiple offer situation and I would dare say that we are more successful than many of our colleagues that do not employ these maneuvers simply because the agents or the buyers don’t understand the implications of doing this. We do. Understanding these options for buyers also helps us to negotiate with buyers (when working with sellers) so that we can suggest the strongest possible terms to buyers agents and explain to them, why these techniques are not as big a risk as one would think.

    Call me to find out more about these aggressive techniques.

Spyglass 78704 Mural

In April of this year, our company partnered with Austin Civil Engineering to enhance the side of our building, located at 2708 S Lamar. Our goal was to come up with a mural that would capture the spirit of 78704 and I think this does it. Hats off to the artist Wiley Ross. You can see more of his work on his website, wileyross.com.


Spyglass Realty 1st Quarter Newsletter

As we end the first quarter of the year, national speculation shows that sales are down in some areas of the country. This could be due to the onslaught of winter storms during the first quarter of the year, experts say. This has caused the fed to re-consider their tapering of QE3, also know as quantitative easement.

Sales are expected to grow through the summer as new developments come online. Outside of Austin, most of the new development neighborhoods are being erected in Leander, Cedar Park, Georgetown and many parts of Hays county.

At this time, the February numbers, which were just released, show median home prices up 10% over one year before, standing at $225,000 in January. The average home price was up as well, 11% to $288,650.

Area 7, which encompasses Barton Hills and Zilker, shows the median home price up a huge 16.8% year over year, landing at $550,000. The “average price” is down (presumably because the data is showing less properties and the homes that sold were down). Both the average and the median price per square foot show a decrease in price. The data also shows that in February 2013 of last year there were 8 properties. A very small sampling of data shows there were 20 in the same time span of 2014. So are values down in area 7? There is also the “pocket listing” problem. Many agents are electing to try to sell properties off market for various reasons. This is fine, but if it is not put into MLS, then your neighbors will not realize the gain, through appraisal, when they list the home.

For example, if the comparable properties only sold for $640,000 and you believe that someone will buy your home for $700,000, you can list your home for $700,000 and find a ready, willing and able buyer who will pay the asking price, but if this buyer is getting a loan, and the appraisal comes out at $640,000, the bank will only lend to that amount. Meaning that the only way to circumvent this is to get a cash buyer or to negotiate the financing contingency out of the contract. We’ve done this a few times on the latter, but only if there are several offers, and the winning buyer is able to bring in cash over and above the down payment. Ideally, Austin real estate agents should put pocket listings into MLS after they close in order for subsequent sales to appreciate properly.

As the summer season approaches, be prepared to see multiple offers throughout on reasonably priced properties. Also be prepared to see interest rates rise as we enter the fourth quarter of the year and the Feds QE3 tappers.