For Rehoboth Beach Real Estate Investors, a "Bubblicious" Re
If you are one of Rehoboth Beach’s real estate investors (or have been interested in how real estate stacks up against other investment classes), the insights of AIG investment honcho Doug Dachille would likely get your attention. Dachille is American International Group’s Chief Investment Officer. That makes him the decision-maker for the insurance giant’s $350,000,000,000 (that’s billion) portfolio.
Last Friday, Bloomberg TV aired a candid interview on the subject of how he feels real estate investors are likely to fare. The attention-getting interview ran under the heading, “AIG’s Dachille Rejects ‘Bubblicious’ Critique of Real Estate.”
It might seem that your typical real estate investor in Rehoboth Beach has little in common with the director of such a gigantic bankroll, but that’s not necessarily the case. It turns out that insurer AIG—just like any local real estate investor—labors under the necessity to safely maximize returns in order “to back obligations to policy-holders.” With government debt interest rates unappetizingly low, it has set the giants (like AIG, MetLife Inc., and Prudential Financial Inc.) scrambling for investment outlets. One answer has been to enter the arena of real estate investors, principally as lenders.
“Insurers hold funds for long periods of time…[so they] have been counting on real estate lending to obtain higher yields available to investors who are willing to sacrifice liquidity.”
So where does the “bubblicious” headline come in? It turns out to be a rejection of an earlier analyst who appraised the current real estate market as looking “a little bubblicious”—one that could face shocks should interest rates climb. That kind of worrisome analysis could cause some sleepless nights for Rehoboth Beach real estate investors with memories of the previous real estate bubble.
A return to peaceful snoozing would have been restored if they happened to catch Dachille’s response. With a very sizeable ($22.9 billion) portion of AIG’s stake in direct commercial mortgage loan exposure, he sees the ability to raise rents as a satisfactory counter to the inflation risk. “Commercial real estate is very similar to an inflation-protected bond,” he said; “What’s…bubblicious?”
Dachille regards the sector as presenting an attractive place for long-term returns—with a risk factor on a par with alternatives currently offering much lower yields. He revealed that AIG has been scaling back investments in hedge funds for a number of reasons. One that might ring true for Rehoboth Beach real estate investors is many funds’ relative lack of transparency. As Bloomberg summarized, “He was uneasy about funds when he can’t track their trades.”
- Written by Russell Stucki
A Real Estate Agent in Rehoboth Beach Wears Many Hats
The best real estate agent schooling isn’t something that takes place in a classroom. That kind of school is necessary, of course, because some of the most important work every Rehoboth Beach real estate agent does has to do with being intimately familiar with the letter of current state laws and Department of Real Estate strictures.
Observing best practices—keeping on top of all the current professional guidelines and legal regulations—does form a solid foundation for building a career in the profession. But important as that is, it’s only a foundation. You have to get busy and build something on it.
As every Rehoboth Beach real estate agent soon discovers, doing the kind of effective job that sets you apart begins early in the morning, and often continues long past what is quitting time in many a 9-to-5 occupation. What’s unusual about what goes on during that day is the array of specialized activities to be attended to. Just about every day, you will be energetically juggling tasks satisfying a wide range of different needs, for instance—
- Pulling and reviewing activity reports from the Rehoboth Beach Multiple Listing Service
Keeping your finger on the pulse of the community yields the up-to-the-hour intelligence that’s a vital resource for sellers and buyers in our active Rehoboth Beach market
- Monitoring and responding to online contacts
Increasingly, as email and messaging become central to real estate activity, near- instantaneous response times are the norm
- Scheduling showings
Arranging showings to accommodate both owners and buyers—and handling the inevitable last minute changes—calls for organizational perseverance (and an abidingly calm demeanor)
- Creating and executing media marketing
Fashioning the kind of attractively worded and designed listings is only the start of the all-important media campaigning that translates into results for your clients
Simultaneously, an accomplished real estate agent often will be keeping track of closing deadline requirements, handling negotiations between buyers and sellers, facilitating communications with home loan brokers, home inspectors, photographers, staging companies and any number of other facilitators…and fielding the dozen other details that might crop up unexpectedly in the course of the day.
- Written by Russell Stucki
Rehoboth Beach Home Inspections Can Cause Jitters Galore
It’s probably just an inevitable part of the human condition.
For almost everyone, awaiting any Rehoboth Beach home inspection is pure, unadulterated jitters time. Nail-biting time. Edge-of-your-seat time.
It isn’t because anyone seriously expects any of our Rehoboth Beach home inspectors to be ogres. Certainly the inspectors I recommend are uniformly courteous, professional, and quite empathetic. They should be empathetic, because of the situation—which consists of a buyer standing by, ready to become the proud owner of seller’s Rehoboth Beach dream house. With only the home inspection remaining to be conducted…
In other words, the inspector is asked to perform a professional service, the purpose of which is to uncover any previously unknown defects.
Potentially derailing the otherwise blissful scenario of uniting of buyer with house.
That is why, in the backs of both seller’s and buyers’ minds, there is usually some form of this scenario: the seller is in the act of dropping the front door keys into the outstretched hand of the buyer, only to have the home inspector snatch them out of the air. Caved-in roof has suddenly materialized; termite-infested inner walls discovered; fireplace housing found to actually be made of strawberry jello (all right, I made that one up). The point is, if you have house-hunted extensively to little avail—then finally found THE place of your dreams, you really really don’t want your Rehoboth Beach home inspection to turn up any bad news. Ditto if it’s your home about to be sold. With the additional factor that if some defect turns up that you knew nothing about, you still could wind up looking like a jerk…
Given the tension and anxiety involved with the profession, it’s just short of miraculous that our home inspectors aren’t all fighting peptic ulcers. The reason is probably because, when all is said and done, performing a thorough home inspection is a high-skill accomplishment—one of great value to both buyer and seller.
For the seller, the home inspection ritual is an exercise that bolsters the buyer’s confidence in the wisdom of such a momentous transaction. Without it, who knows how many homes would not change hands as readily? For the buyer, even when no defects are discovered (as is often the case), the home inspection report serves as an invaluable handbook, filled with useful details about the nature and status of the residence’s structure and systems.
Some agents believe they should spare jittery home buying clients a nerve-wracking experience by counseling them to stay away during the actual home inspection. However, accompanying the inspector is a valuable way to get in-depth knowledge about the workings of their new residence. Plus—there’s no better way to get over those jitters than to acquaint yourself with the real value you are about to acquire.
- Written by Russell Stucki
Top 5 Rehoboth Beach Home Buying Bargaining Point Basics
When a new buyer first approaches their initial Rehoboth Beach home buying effort, chances are they have only a general idea of what the process involves. Although they are successful people who have arrived at a juncture in their lives and careers where it’s now possible to buy a home of their own, most of the details—and even the terminology—is specific to this single kind of transaction. More than in most other purchases, there are a number of junctures where negotiations determine the outcome.
It’s pretty common to assume that their Rehoboth Beach home buying venture can be wrapped up with a single offer—one that will either be accepted or not. But along the way, from the home loan provider to the title insurer to the seller, other bargaining points frequently appear.
A first Rehoboth Beach home buying venture is sure to run more smoothly if these basics don’t come as a bolt from the blue. Most of these five fundamental bargaining point basics might be guessed at, but anticipating them all will put any first-time buyer in a much better prepared position:
- Down payment. It’s not true that buyers must put 20% down to buy a house. Or 10%. The amount of the down payment is a bargaining point with the lender, who usually offers trade-off choices.
- Pre-qualification/Pre-approval. The difference between the two terms can make a difference in how eager some sellers are to talk turkey. Pre-qualified means the lender has received a potential borrower’s information; Pre-approved means the bank has verified it, which presents the buyer in a stronger light.
- Closing costs. The down payment isn’t the only “up front” cost: there are a variety of other home-buying fees and charges that must be paid before the deal is financed. It’s a myth that the seller is obligated to pay closing costs—it can be a bargaining point, though.
- Home inspection. The inspection report informs the buyer what might need to be fixed now or at some future time. If the buyer has made an offer contingent on a flawless report, if problems are identified the seller can offer to correct them, pay a named amount for a cash-back credit—or refuse (a “take it or leave it” stance). In any case, it’s another bargaining point.
- Asking Price/Offering Price. This is the bargaining point that is fundamental in every Rehoboth Beach home buying venture. The seller can accept, reject, or compromise with a counter-offer. Then again, if more than one buyer is interested in a property, stand back: a bidding war could erupt!
- Written by Russell Stucki