Bryant Back Bay

Just to give everyone a little perspective on the current condo market in Boston, MA, here is a true story….Thursday, a new listing at the Bryant Back Bay came on the market for $1,794,000+$140,000 for a second garage space. Well, based on the feedback, the auction sale prices are in the rear view mirror.

Saturday there were 5 showings, Sunday Open House had 16 groups come through, Monday morning saw 5 more groups come through and unit went Under Agreement Monday afternoon.

Lesson Learned: The luxury condo market is heating up FAST.  For units to be flying off the market this fast in early February is a pretty clear indication that the Spring market is going to be very strong.  Buyers need to be ready to act if the right opportunity presents itself.

*The best advice we can give you is to find a good Buyer’s agent, preferably from LRG;-), who will monitor the market on a daily basis and notify you when your ideal home comes on the market.

• $13.04 per $1,000 of valuation for Residential.
• $31.92 per $1,000 of valuation for Commercial

Now for some good news. In 2012, qualified homeowners can expect to save $1,644.28 on their tax bill.  What qualifies someone to receive this residential exemption? As defined by the City of Boston:

“The principal residence is the address from which you file  your State income tax return.  Your social security number will be required to verify eligibility.”

If you think your home is assessed to high, you can always file an abatement with the City.  The proper forms can be found by clicking here.

Is this a sign of inflation or just an in line increase? Compared to other major US cities, Boston is relatively inexpensive. Philadelphia is $2/hour, Washington, D.C is $3/hour and Los Angeles is a staggering $4/hour.

Meter prices have not increased in Boston, MA since the mid 80′s. The city will also be implementing a “Smart Card” system in which you can reload a parking debit card at various locations.

Unit      Original Price          Min. Price      Sale Price         $$$/Ft

806       $1,860,000             $1,250,000        $1,606,000      $855

704        $1,910,000             $1,130,000        $1,495,000      $700

705        $1,925,000             $1,130,000        $1,603,000      $745

706        $1,875,000            $1,130,000        $1,603,000      $764

701        $1,710,000             $1,130,000        $1,365,000      $714

904        $1,985,000            $1,250,000        $1,505,000      $791

903       $1,875,000             $1,175,000        $1,489,000      $830

906       $1,975,000             $1,250,000        $1,466,000      $781

905       $2,025,000            $1,250,000        $1,631,000      $840

606       $1,825,000            $1,130,000         $1,446,000      $690

306       $1,540,000            $1,075,000        $1,449,000      $675

The takeaway is simple.  The Luxury Real Estate Market in Boston is very very strong. Below is the original table of properties:

Table of Properties

Unit 906 at The Ritz Carlton Low Rise is being auctioned off on September 15th at 11am.

More details will be unfolding but the unit has been rented for quite sometime at a very high rate per month.  A foreclosure auction would seem unlikely, but it is possible the owner was pocketing the money and burning the bank, as well as the building condo association. It is also possible that the 3 Avery Street Condominium Association forced the sale due to back condo fees.

Let this be a lesson; building CONDO ASSOCIATIONS can, and will put a lien on your unit if you do not pay your condo fees in a timely fashion. You will not be issued a clean 6D certificate(Document from the condo association that states you, the seller, does not have any outstanding balances due to the condo association, or upcoming special assessments) and may hinder the sale of your property in the future.

To see more photos of the unit, or if you have any questions, please visit:

http://www.lrgboston.com/71085243/Boston/Midtown

Terms of Sale: A deposit of $25,000 by certified or bank check will be required at the time & place of sale & balance within 30 days.

All other terms announced at sale. Perry, Krumsiek & Jack, LLP, Boston, MA, Attorney for Mortgagee

The short answer is NO.

As high end, professional real estate brokers, we at Luxury Residential Group ALWAYS advise our clients to seek the guidance and services of a licensed real estate attorney when purchasing property in Massachusetts. 

Real Estate Attorney Duties:

• Look over the offer
• Negotiate the Purchase and Sale on your behalf and look out for your best interests.
• Run the title search to make sure there are no liens on the property
• Acquire title insurance – In MA, there are no title companies.  The attorneys act as brokers to acquire title insurance.  This differs from state to state.
• Review condo documents and budget if purchasing a condo.
• Inspect deed for any defects (If the unit does indeed have that parking space included and if it is deeded or just a “Right” to park).
• Work with the cooperating attorney and brokers to make sure all dates, deadlines and contingencies are met.
• Work with the lender to secure proper financing.
• Conduct the closing and explain all the papers you are signing.
• Disburse closing funds from escrow accounts.
• File the deed and make sure everything goes on record properly.

Along with these services, the use of a lawyer is paramount to protect your legal best interests. Without using an attorney, you leave yourself open to significant liability that go beyond the cost of your condo.  At the end of the day, the services of an attorney should only cost you $1,250 to $2,000.  If they broker the title insurance, it could be less(note, the average cost above, does not include the cost of the title insurance itself).  Your real estate broker understands all the documentation, but they are NOT licensed attorneys. It is unfair to expect them to be.

Luxury Residential Group’s Thoughts:

We applause Google for putting their core principals ahead of their bottom line.  It may be one of the most refreshing, and forever lasting events of our time.  Nothing, throughout history, has been able to force change in China until now. Who would have thunk that Google, an American company, would be able to accomplish something  that no other Government or Human Rights Group could.  We feel that Google will prevail in the end, stay in China and put a huge dent in the Governments stand on censorship.

What does this have to do with Real Estate?

It highlights the fact that no matter how much money is at stake, or how far two parties are apart in a negotiation(could be $500 on a $5 million dollar transaction), one should NEVER challenge or question another’s core principals. It will undoubtedly end all negotiations and profitable relationships moving forward.

Steven Ceprano - Summers and Summers LLP

We had Steven Ceprano of Summers and Summers in Boston, MA answer that question for us:

Conference with client, cover issues such as how to hold title (tenants in common, joint tenants, tenants by the entirety), information on type of property to be purchased (i.e., single family, condominium, multi-family), and financing issues.

Ø      Review offer to purchase

Ø      Negotiate and prepare purchase and sale agreement

Ø      Review condominium documents and financials.

Ø      Advice concerning financing and tailoring of purchase and sales terms to lender’s requirements

Ø      Review the results various inspections

Ø      Review title examination with bank’s attorney

Ø      Attend closing and review papers which buyer is required to sign

Ø      Set up escrows and special arrangements to correct title, complete construction or assure possession

Ø      Arrange title insurance protection for buyer against losses due to title defects, if desired

Ø      Transfer of security deposits and notices to tenants (if purchasing multi family house)

*We at Luxury Residential Group always recommend having the representation of an attorney when purchasing a property in Boston, MA. Please do no not try to make a go of it yourself.  You leave yourself open to too many risks. An attorney generally charges $1,250-$2,000($500-$750 to negotiate the P and S, and another $750 to $1,250 to handle the closing and make sure you have the proper title insurance.

What is Title Insurance?

Title insurance is policy that covers homeowners and mortgage companies from unknown defects in the deed. It is the responsibility of your attorney to do a title search prior to closing. Unfortunately unforeseen circumstances come up.  Both buyers and lenders should have title insurance. The lenders policy only covers their portion of the mortgage.  If you pay cash, or put down a large amount at closing, you should have title insurance covering your portion of the value as well.

You might ask yourself, what does title insurance cover?

Title insurance covers many things, mostly unforeseen and for a large portion uncommon circumstances.  At a recent closing, the buyers attorney (Steven Ceprano of Summers and Summers in Boston) told us a story about something that happened to one of his clients:

A buyer moved forward with the purchase of a property. 1 year later a woman comes forward saying that she never authorized or intended to sell this property.  Her husband at the time forged her signature while she was out of the country and she was notifying the current owners that she was taking the property back.  She had a right to her home that was illegally sold.  Now, had the buyer NOT had title insurance, they would have been out of luck and would have had to go through a lengthy lawsuit to get their money back.  Since they did purchase the policy, the insurance company was responsible for paying them back the money they had put down on the home.  The buyer was free and clear but the insurance company had to go through the process of recouping their losses.

How often does a total loss like this happen? Almost never, but is it worth taking the risk?  We at Luxury Residential Group do not think so.

What is title insurance going to cost me?

Title insurance is something you pay once, at closing, and is usually $3.25-$4.00/$1,000 paid.  For example, if you buy a home or condo for $425,000, you should expect to pay between  $1,375 and $1,700.  Although a good amount of money, it pales in comparison to a $425,000 dollar loss and covers you for as long as you and your heirs own the property.

What you should take away and Luxury Residential Group‘s two cents:

Title defects occur quite often and are usually picked up by the title examiner, hired by your attorney, and paid for by you at the closing.  If a defect is found, it is the responsibility of the seller to take care of and have it removed from the title prior to closing. Unfortunately, a lot of buyers and sellers these days try to do things themselves(P&S, Closings, and filing of the deed) in order to save themselves money on closing costs and doing a thorough title search is overlooked or something that is unknown by the buyer.  Buyer BEWARE, if you do this, you run the risk of SIGNIFICANT losses.  You should ALWAYS hire a professional and experienced attorney.  If you do not, you might find yourself responsible for paying back former owners, lenders, painters, plumbers, gardeners and pretty much any other contractor you can think of who may have gotten burned by the previous owners.  You also run the risk of not only losing your property, but having to fight a lengthy court battle to get your funds back.

We have some some pointers that will save you a lot of time, money and headaches:

1. PRICE, PRICE, PRICE -  We all know that your property is the best.  We understand you put a lot of love, sweat and money into making it perfect.  Unfortunately, if you want to sell it in a downturn, the best strategy is to price it 10-15% below your neighbors who are selling a comparable home. The bottom line is, those same neighbors will be sitting on their property 3 to 5 times longer, and eventually end up at the same price point if not lower than what you sold your property for months earlier.
2. UPGRADES – Not all, but most buyers, prefer not to pay a big premium for your style and upgrades. Yes your finishes are superior, but if you ask a $1.5 to $2.0 million dollar buyer what they would prefer: A higher floor unit, same layout, with lesser finishes but a better view, for $1.7 million, OR, a slightly lower floor unit with superior finishes for $2.0 million, most if not all would go with the higher floor.  The buyer can use the $300,000 to style it to their liking while achieving superior views. Be realistic.
3. MAKE IT EASY AND ENJOYABLE TO SHOW – Always make sure your home is clean, clutter free and smelling good (scents can deter buyers).  Also, do not make it difficult for your broker to show the property.  Things like, “My dog is sleeping”, “the maids didn’t come”, “the in-laws are here for a week” etc etc. Your goal is to sell!! Even though your life might be disrupted for a few months, this is probably the single biggest asset you own, so do your best to deal with the inconvenience.  Allow the broker to show the property on SHORT notice and do their job.  If you don’t, you will undoubtedly miss good opportunities.

Clean and Pristine Condition

From reading this blog posting you know what we are getting at. If you are FORWARD thinking, you will be rewarded.  Everything comes down to price in the end. Listen to your broker, that is why you hired them.  They are looking out for your best interests.  If you feel they are not, find someone else to market your property ASAP.