Chattanooga Real Estate Blog

More bad news for the nationwide real estate market.  RealtyTrac released its September Foreclosure Market Report showing 112,210 properties nationwide entered some stage of foreclosure during the month, a decrease of less than 1 percent from August, and a 63 percent increase from September 2005.

Tennessee didn’t fair well.  Coming in at 13^th in the nation, one in every 889 households entered some state of foreclosure in September for a total of 2757.  That’s an increase of 16.23% from August and a whopping 28.05% from September 2005.

Ketner’s Mill Country Arts Fair is in its 30th year and still going strong.  Today was the first day and it will be winding up tomorrow. Over 100 artisans are there doing demonstrations and selling their products.  Over 20 food vendors are selling everything from funnel cakes to texas taters.  Go on a wagon ride, watch the mill in action grinding fresh cornmeal and watch a demonstration on the making of Sorghum Molasses using "donkey power".

Celebrate the 85th Anniversary of East Ridge by attending the 2nd Annual Pumpkin and Cider Festival at Camp Jordan.  Expect to find live music, plenty of food, arts and crafts, and lots of games for both adults and children.

It’s just a 30 minute ride north on I75 to the Cleveland Apple Festival.  It’s a family festival where you will find live bluegrass music, food booths, pony and hay rides, entertainment, children’s activities and much more!

You get to choose the best firehouse chile tomorrow at the 4th Annual Firehouse Chili Cookoff.  Starting at noon at the Chattanooga Market five fire stations will be competing to see who makes the best chili.  Five dollars will get you a three ounce serving from each team.  There will also be a childrens interactive area. All proceeds will be going to the Muscular Dystrophy Association.

If you enjoy the orchestra, you should attend the first Champagne Concert of the season with the Chamber Orchestra of Tennessee.  This year the first concert will be held at the Fairyland Club on Lookout Mountain.  This is the 6th season for this wonderful series.

The 3rd Annual Y-ME of Chattanooga Fashion Show will at the Chattanooga Trade and Convention Center.  There will be a silent auction and refreshments at 2 pm with the fashion show beginning at 3 pm.  This year 24 local breast cancer survivors will serve as models.  "No one faces breast cancer alone."

According to a survey conducted by market researchers at Harris Interactive between March 31 and April 6, boomers not only believe in owning real estate, they plan to keep buying as they head toward retirement.  In fact, 1 out of 4 boomers will likely purchase some sort of real estate in the next 12 months.

The BaltimoreSun.com has the findings of the survey as well as a lot of other interesting statistics regarding baby boomers.  For example: 

"The value of boomers’ primary homes varies sharply by geographic region. Overall, the median market value of their homes nationwide is $181,700. But in the Midwest, the median is $143,400, in the South it’s $147,800, the Northeast $215,000, and in the West $359,100. One of every 14 boomer households in the Western states owns a home worth $1 million or more."

There is some pretty revealing info included.  Take a few minutes and read it. 

Now we will take a look at a few of the Standards of Practice of Article 1, Duties to Clients and Customers.

Standard of Practice 1-1
REALTORS^®, when acting as principals in a real estate transaction, remain obligated by the duties imposed by the Code of Ethics. (Amended 1/93)

This one is obvious.  A REALTOR^®  must adhear to the Code of Ethics.  Not much to say on this one.

Standard of Practice 1-2
REALTORS^® are acting as agents or in legally recognized non-agency capacities except that any duty imposed exclusively on agents by law or regulation shall not be imposed by this Code of Ethics on REALTORS^® acting in non-agency capacities.

As used in this Code of Ethics, “client” means the person(s) or entity(ies) with whom a REALTOR^® or a REALTOR^®’s firm has an agency or legally recognized non-agency relationship; “customer” means a party to a real estate transaction who receives information, services, or benefits but has no contractual relationship with the REALTOR^® or the REALTOR^®’s firm; “prospect” means a purchaser, seller, tenant, or landlord who is not subject to a representation relationship with the REALTOR^® or REALTOR^®’s firm; “agent” means a real estate licensee (including brokers and sales associates) acting in an agency relationship as defined by state law or regulation; and “broker” means a real estate licensee (including brokers and sales associates) acting as an agent or in a legally recognized non-agency capacity. (Adopted 1/95, Amended 1/04)

The terminology can be very confusing. 

Basically, the public can be refered to by one of 3 words.  If you are my "client" then I have a contract with you to represent you in either the purchase or sell of real estate.  If you are my "customer", I have no contract with you but have provided some information that is not "client level service".  If you don’t fall into one of the catagories above then you are a "prospect". 

I have certain responsibilities and obligations to each of them with the most and highest level of service being owed to my clients.  I will go into agency in the next day or two.

We, REALTORS^®, are either "agents" or "brokers".  If I have a contract with you, I am an "agent".  If I don’t have a contract, I am a "broker".

I know this is a little dry but you have to know the terminology in order to understand the parts each person plays and what the duties are to them based on their part in the transaction.  Kind of like math.  You have to have good knowledge of the basics or you are doomed to failure in trig.

That’s all I have time for right now.  I have some clients on the way in so next time we’ll continue on with the Standards of Practice for Article 1.

Lets take a look at the Code of Ethics with a Pledge of Performance and Service that every REALTOR® agrees too.  A full and complete version can be found here. 

The Code of Ethics is broken down into 3 sections:  Duties to Clients and Customers, Duties to the Public and Duties to REALTORS®.  Each of these sections is further broken down into articles which are then broken down into sections know as Standards of Practice. 

Since I believe the public nor the FTC have any idea what we mean when we say "Code of Ethics" I’m going to posting my thoughts on each Article and SOP over the next few weeks.

Article 1

When representing a buyer, seller, landlord, tenant, or other client as an agent, REALTORS^® pledge themselves to protect and promote the interests of their client. This obligation to the client is primary, but it does not relieve REALTORS^® of their obligation to treat all parties honestly. When serving a buyer, seller, landlord, tenant or other party in a non-agency capacity, REALTORS^® remain obligated to treat all parties honestly.

What does this mean?  It means the primary concern of a REALTOR® is to promote the interests of our clients as long as it is legal.  Pretty simple.  I want my clients to receive the best possible service and for them to succeed in reaching their goal, whether it’s buying a home or selling a home.  My interests don’t play into the scenerio.  If I put my interests above my clients then I am violating the number one item in the Code of Ethics that I have agreed to abide by.  We actually work for our clients not for ourselves.

This Article always makes me think of the Andy Griffith episode where Barney decides he wants to sell real estate.  He puts together a deal where several families are selling their houses and buying others.  Opie tells the people who want to by their house about some problems.  They decide not to buy and Andy decides not to buy the one he was going to that has a lake in basement when it rains.  Barney gets mad because everyone backs out and no one buys or sells.  He has a fit because of all the commission money he just lost. 

That’s not the way it is anymore.  Unfortunately, that is still the perception that a lot of people and apparently the goverment has of the industry.  I’m not even sure it was that bad in the early 60′s when this episode was filmed.  We now have agency and disclosure in addition to the code.  Real Estate has come a long way since the days of Barney when it was every man for himself. 

Next up we’ll discuss the individual Standards of Practice points in Article 1.

In the past, payment shock as been what a new homeowner felt when they realized their mortgage payment was substantially higher than their rent payment.  Now, payment shock occurs when a homeowner has just realized that his adjustable-rate mortgage payment is taking a big leap.

All those people who bought homes over the last few years with interest only and adjustable rate mortgage (ARM) loans are experiencing this payment shock now.  They were good programs when the market was booming and rates were down.  But now the market has slowed and rates have climbed a little.  And long with the climbing rate comes the increase in payment amount.

Eileen Smith with Courier Post Online has written a good article discussing the options a homeowner has at this point.  If you can refinance with a fixed rate that is lower than your adusted rate it might be advisable to do so.  However, some loans have a pre payment penalty so it is important that you read over your mortgage agreement.  You may or may not be stuck with the high adjustable rate.

Interest rates compliments of:

Interest rates compliments of:

Owens Financial Group
Melanie Huddleston
1007 Ashland Terrace
Suite 104B
Chattanooga, TN 37415
423-648-7630

 Conventional Fixed Rate

30 yr  =  6%

15 yr  =  5.75%

FHA and VA

30 yr  =  6%