Winners and Losers in Real Estate

Home Values. Who decides?

How Much Is That Person’s Coffee Mug ( Seller’s Property) Worth?

Why is it more difficult now to bring buyers and sellers together in real estate transactions than just a few years ago? Princeton economist Daniel Kahneman, Nobel Prize winning author of Thinking Fast and Thinking Slow sheds light on this seemingly perplexing question. Take a simple coffee mug for example.

“Kahneman’s work shows empirically what many individuals have long felt when confronted with economic models of rational cost-benefit calculation — people don’t always think rationally, even if they consider themselves rational actors. To give a concrete example, in a classic experiment, Kahneman gave half of the participants a mug and the other half no mug. He and his colleagues then asked how much those who had the mug would be willing to sell it for and how much those who did not have a mug would be willing to pay for one. Those who had a mug were not willing to give it up for under $7; those without one would only pay $3 to buy one. The result? What economists now call “the endowment effect” — individuals value what they have more than what they could have, even though rationally the mug should have the same value whether it is being bought or sold.” WWS News, Princeton University

Sellers and Buyers of real estate naturally exhibit the same tendencies. Sellers frequently value their home or other real estate substantially more highly than prospective buyers do, and more so the longer they have lived in the home or owned the property.  How much is that home worth?  “ It all depends on if you actually have one.  In the Kahneman study the mug owners estimated the value of the mug to be about double what the non-mug owners were willing to pay.  Rational? Maybe not, but that’s the point. Studies like this one, demonstrating that people respond differently to a proposition depending on whether it is presented in terms of a loss or a gain, are part of the 30 years of work that earned Princeton psychology professor Daniel Kahneman the 2002 Nobel Prize in economic sciences.”*

While most real estate sellers don’t usually seek double what the average buyer is willing to pay, there is a natural divergence between buyer and seller perception of value in real estate. A fascinating change occurs however, from the time the owner places their property on the market to the time the property actually sells and that change can be graphed. From the beginning when the seller feels someone would have to pry him loose from his home to the end when he just wants out at any price, his perception of value of his property clearly declines. It is a known fact that every seller will lower their expectations and price over time.

What is that property really worth? In one sense, whatever someone is willing to pay and if no offers are made, that is a sound indication the listed price was just too high.

The Article Below is Courtesy of  www.iBerkshires.com an online news source for Berkshire County MA residents

Berkshire County Housing Market On Upswing

By Stephen Dravis
Special to iBerkshires
07:10PM / Saturday, April 07, 2012

Berkshire County Real Estate as well as Williamstown Real Estate is showing anecdotal evidence of a good start in 2012.

The anecdotes make things sound really good.  “I had two showings recently where the buyers were paying with cash – one was from Boston and one was from Connecticut – and they literally signed a contract to buy during my showing,” said Realtor Paul Harsch of Williamstown, who has listings in Massachusetts, New York and Vermont. “That showed that we had priced these houses well and that they showed really well.

“We’ve written up several contract in the last two to three weeks. We’ve really been busy.”    Although no one is predicting a return to the sellers’ markets before the “Great Recession,” the region shows signs of recovery from the doldrums of 2011, according to sales figures from the first two months of the year.  Data from the Berkshire County Board of Realtors shows that 103 residences changed hands in January and February, 2012, up 5 percent from the same period a year ago.

This Williamstown Home was sold March 2012

In North County, the numbers are even better, with 25 sales in the first two months of this year, compared with 18 in 2011, a rise of 38 percent. North County homes selling from Jan. 1 to Feb. 28 spent an average of 143 days on the market, down from 207 days in the same sales period a year ago, a difference of 30 percent.  The flip side of those strong sales numbers: The median price of a home in North County the first two months of the year was down 54 percent from a year ago, from $193,500 in 2011 to $125,000 this year.  That is the price that sellers pay as the market readjusts to new realities, Harsch said.

“Some [buyers] have figured, ‘It can’t get any worse, interest rates are fabulous and can’t get any lower,’ in terms of timing, it would be hard to argue it will get much better from the buyer’s point of view,” he said. “On the other hand, there are sellers who, for some reason, are not ready to meet buyers at current market values. That has held the market back, somewhat.”

The county real estate market took a hit last year, when the total number of sales slumped to 828, a drop of 5.5 percent from 2010′s pace.

Harsch is not alone in seeing positive signs for the 2012 market.  “I’m very encouraged,” Berkshire County Board of Realtors President Chapin Fish said. “There have been a lot of people showing and people looking. I think there’s a certain amount of pessimism fatigue, and people are ready to move forward.”  Fish, who works primarily in South County, said optimism is not limited to the Berkshires. “I was on a webinar (April 4) with Barbara Corcoran, who founded (Manhattan’s) Corcoran Group, and she felt, and I have to agree, that the low point of the market was four or five months ago,” Fish said. Fish said most of the activity is in the lower-priced homes, but he also is sensing more interest in land, which has been a quiet sector of the real estate market in recent years.

Another hot sector: condominiums.  “Keep in mind, condos represent only about 10 percent of our sales market, but we’ve seen significant gains in the first two months of 2012 in every part of Berkshire County,” Berkshire County Board of Realtors CEO Sandy Carroll said. “Sales jumped 200 percent, dollar value jumped from $164,000 transacted last year to $1.6 million this year, and our median prices are climbing, with a gain of over 15 percent.”  Harsch said the local market benefits from a strong community of local banks that make it easy for qualified buyers to obtain loans.

Sellers, on the other hand, are sometimes hamstrung by existing loans that make it difficult for them to realistically price their homes, he said.  “It’s a difficult and somewhat unwelcome adjustment,” Harsch said. “Let’s face it, no one wants to see their property values decline. But another way to look at it is they’re returning to a norm after escalating in an unprecedented manner from 2000 to 2007.

“We’re returning to a norm, but anyone who bought during the go-go years is struggling with the new realities.”     Full Article link on the iBerkshires News page

Harsch Associates Real Estate is pleased to announce the Spring 2012 recipients of the real estate firm’s Charitable Gifting Program.

Harsch Associates sets aside 1% of its gross pretax income from each sale and the buyer/seller chooses their favorite charity organizations to receive the money. Listing property or buying property through a Harsch Associates Real Estate Agent ensures your

favorite non-profit organization will receive direct support .

The spring 2012 recipients are:

Berkshire Family and Individual Resources,

Berlin Central School District,

Children of Fallen Soldiers,

Cystic Fibrosis Foundation,

Ecu-Health Care,

Flying Cloud Institute,

Greylock ABC,

The Haiti Plunge,

Hancock Volunteer Fire Department,

HooRWA,

Humane Society,

Little Red School House,

Mount Greylock Soccer,

North Adams Ambulance,

Northern Berkshire Community Action,

Northern Berkshire Habitat for Humanity,

Northern Berkshire Santa Fund,

Williamstown Cal Ripken Little League,

Williamstown Village Ambulance,

Williamstown Community Chest,

Williamstown Elementary School,

Williamstown Rural Lands Foundation,

Williamstown Youth Center.

Everyone at Harsch Associates extends a sincere thank you to all of our clients.

Berkshire Business Brokerage

Williamstown real estate agency Harsch Associates has brokered many business sales in Berkshire County MA.  Businesses in Berkshire County range from international corporations like Sabic to the everyday mom and pop main street businesses like small retail businesses and restaurants.

Since 1975 Paul Harsch of Harsch Associates has provided a specialty skill in business brokerage to the Berkshire business community and in adjacent Vermont and NY.  From motels, to small manufacturing firms, retail stores, inns, and service businesses, Paul has provided a level of skill and experience which surpasses the typical real estate licensee.

Paul’s educational and professional credentials include a BA degree earned from Williams College followed by course credentials from industry groups. These include: Massachusetts Realtors® Institute – GRI Designation, Certified Residential Specialist – CRS Designation, Certified Residential Brokerage Manager – CRB Designation, Certified Business Intermediary – CBI Designation, and American Institute of Real Estate Appraisers – Course 1A.

Paul is a member of NAR – National Association of Realtors®, the Residential Council of National Association of Realtors®, the Berkshire County Board of Realtors® and has served as Past Vice President and past Director past member of the MLS Committee, the Southwestern Vermont Board of Realtors where he served as past Chair of MLS and held membership in IBBA – the International Business Brokers Association.

Paul’s past clients and sales successes in business brokerage have included businesses from Great Barrington in the south to Bennington, Vermont many of which included real estate components.
Past business sales include the Village Inn in Lenox, MA, five different motels in Williamstown, restaurants, the Spice ‘N Nice health food store in Bennington, VT, and most recently Catherine’s Chocolates in Great Barrington, MA. Current offerings include a motel in Cambridge, NY.

Paul’s business brokerage expertise stems from 37 years of experience, specialized training in business brokerage and intimate knowledge of the region. Paul specializes in profitable businesses with strong track records, thorough financial records and promising futures. Contact Paul today to begin your search for a business opportunity in the Berkshires or to sell your current business.  413-458-5000

Business Brokerage is both a skill and an art.

Williamstown Home is a definite 10 !

Williamstown MA in Northern Berkshire County has many lovely homes on the real estate market this spring.  Berkshire County MA has always been known as a  great place to live or retire or vacation.  Harsch Associates Berkshire Real Estate is proud to present one of our newest listings located at 10 Ide Road on a corner lot and surrounded by a white picket fence.

Caringly conceived and crafted by a renowned local contractor, this nearly new

A chef kitchen with island and bay window breakfast area

Williamstown home welcomes all who enter its warm spaces with inviting appeal. Your first reaction will be delight as you gaze on the hand crafted details everywhere your eye settles, from the window moldings, to the country look kitchen cabinetry, the muted colors and the light everywhere. There is nothing overlooked in this thoughtfully laid out four/five bedroom home. The ground floor master suite is a symphony of luxury at this price, including separate dressing room, huge walk-in closet, sparkling bathroom featuring jet tub, twin sinks with cabinets and shelving galore, and separate walk-in shower room. Both the cathedral living room and sun room/library/office enjoy the cozy convenience of gas fireplaces. The chef’s kitchen and family dining area complement the formal dining room. The second floor offers two generous bedrooms with adjoining bath, office/studio, and guest bedroom suite. The lower level provides an enormous entertainment room with wet bar, wine cellar and three quarter bath. All of this plus central AC, plus  two covered porches, a stone patio and the two car garage are contained in an eye-appealing New England Cape style white clapboard home settled nicely on its half acre landscaped grounds surrounded by a classic white picket fence. So many more details that you must see this lovely home to begin to appreciate its quality and features.   Call us today to visit this home !

Want to preview the home right now?  Virtual Tour

Giving Back to our Community

Harsch Associates|Williamstown MA| Charitable Donation Program

For all real estate listings placed with Harsch Associates and all purchase agreements signed with buyers, Harsch Associates Real Estate will donate 1% of Harsch Associates’ brokerage fees to the clients’ choice of a local charitable organization.  The charity must have a 501 status and be engaged in charitable work in the immediate community where the property is located. “We have added another reason for buyers and sellers to choose Harsch Associates Real Estate,” stated Paul Harsch, president. “We have long supported worthy non-profit groups and organizations in our market area.   We are committed to our community and we are confident that our clients share this commitment to community.  The choice of where their donation will be sent allows our clients to choose how to share that commitment.   Each client will receive recognition for the donation made in their name.

Harsch will establish a working committee to select a number of area charities to receive the funds and also allow clients to direct the funds from their transaction to any other charitable organizations that fit basic guidelines which insure the receiving entity is directing the majority of its funds to benefit the residents of the market area where the property is located. “Our goal is to give back to the immediate community in which the buyer and seller are living” stated Margie Durning, the business manager for the firm who will be responsible for the accounting for the funds.

“We realize just how important giving is to receiving and when clients choose our firm, this is another way in which we can provide our support to the communities that support us” added Paul Harsch.

“I’ve lived here since 1972” said Carolyn Umlauf, one of the firm’s senior associates “and I love this community. In this way, our company is helping those who depend on public and private support and which do such important good work within our community”.

Harsch Associates was selected in ’09 as the exclusive sales brokerage firm for the Cable Mills condominiums project to be located on Water Street in Williamstown. Not since the 1970’s has a residential project of this size been created in the Northern Berkshires. Kevin White, sales associate at Harsch and Director of Sales for the Cable Mills project believes that the sale of condominiums within the next six months will form a significant portion of the contributions distributed in July 2010.  “The one percent donation program is a way to reinforce Cable Mills’ commitment to our community,” said Mr. White.

The gifting program is simple. When either a buyer or seller comes to Harsch Associates, they will select the charitable organization to which they wish the donation made. All donations for sales that are concluded within the new program’s six-month period will be made in July 2010. Donations will be made at the end of the calendar year for sales that close during the second half of the year.

“We have devoted ourselves at Harsch Associates to creating what we believe to be an outstanding marketing platform with the goal of making the process of buying or selling real estate as efficient, beneficial and trouble free as possible for our clients.,” said Mr. Harsch. “Not only do we strive to deliver outstanding service and results but we also can now provide each client with the added good feeling of knowing that a portion of the company’s brokerage fees is automatically going to help the community in a concrete manner they personally can direct.” Harsch Associates will be the first real estate agency in its market area to formally commit a fixed level of its brokerage fees to help those less fortunate.

For more information about this innovative program contact Paul Harsch at 413-458-5000

or write to Paul Harsch at Harsch Associates, 311 Main St., Williamstown, MA 01267.

Revolutionary War Antique Home

This Williamstown Real Estate property comes with a colorful history relating back to the Revolutionary War.  Located in Northern Berkshire County within walking distance to Williams College this Williamstown home was built by Judah Willliams whose fortune was made during the Revolutionary War.  Judah Williams supplied the necessities of war to the Continental Army in his position as commissary.   This landmark antique home is surrounded by lush old trees and is set back from Main Street by an expanse of town green.

The home has been maintained as closely as possible with the original floors, high ceilings, and a lovely perennial garden.  Comfort and energy efficiency have been taken in account and ensured with the new replacement windows, additional insulation and updated master suite with private bath.  A relatively new reproduction carriage barn offers space for two vehicles.  This home has a high walkability quotient as it is located very close to Williams College and the restaurants and shops located on Spring Street.  Take a virtual tour of  674 Main Street Williamstown MA now.  Currently this home is priced at $535,000

Looking for a Berkshire OM?

Finding your “OM” in Berkshire County is a great recommendation by Krista Rossow of the National Geographic Society.  She shares with us the article below.  Find more great Spring Travel tips for visiting the Berkshires at this site The Berkshires.  Read Krista’s article below.

Spring is here, or just about to be! Time to start planning your out-of-town escapes. And, boy, do we have some ideas for you. Check out our list of Best Spring Trips for 2012. As an added bonus, we’ll be featuring a few extra ideas on the Intelligent Travel blog this week.

For those of you who could use a spring cleaning for mind and body, the transitional months before summer are a great time to schedule a personal getaway. Here are three places where you can get your “om” on.

Nestled in in the verdant Berkshires of western Massachusetts, Kripalu Center for Yoga and Health is open year round, offering programs that cater to a broad spectrum of interests, from meditation and yoga to nutrition and cooking. It also has an R&R retreat program where you can hand pick your classes and activities for the day. In your down time, visit a nearby lake to kayak or swim, steep in the sauna, hike the grounds, or go off-property to catch a concert at Tanglewood or visit the Norman Rockwell Museum. For information on Kripalu, email registration@kripalu.org or call 866-200-5203.

So you like your yoga, but you like your food and wine, too? Sign up for a “Vino and Vinyasa” retreat in the vine-covered hills of Sonoma, California at the end of April (4/26-29). Practice yoga during the day and dine on organic, locally-sourced gourmet meals paired with sustainable wines from OM Winery at night. In your free time, explore the countryside or check out one of the fabulous wineries nearby such as B.R. Cohn or Kenwood. You’ll come away a verified oenophil-ogi. Contact Sarah Marshall at sarah@omwinery.com or 707-259-1252 for more information.

The Expert Realtor- Conscious Competence+Mastery

When it comes to buying a home in the Berkshires does it make sense to seek help from a expert Realtor®?   The simple answer is YES.

Purchasing Williamstown real estate using an expert real estate agent can save you anywhere from a few thousand dollars to tens of thousands of dollars or more.  What is the best way to save money on your Williamstown real estate purchase?   Choose and work with an expert Realtor®.   Tom Hopkins a real estate expert who  has trained many new and master Realtors® has some good advice for buyers.  Tom created and shares with buyers and sellers the 3 stages of Realtor® competency.  Wise advice for a buyer to consider if saving money is your goal.

3 Stages of Berkshire County Realtor® competency

1. Unconscious competency- novice or beginner Realtor® with a new license in hand and little experience in sales- usually less than 25 Berkshire County property sales
2. Conscious incompetence- usually after several years in the business the seasoned Realtor® realizes how many skills are required to master the art of the deal and getting all parties to the closing table.  This is when many Realtors® choose to obtain additional education and certification. Usually more than 25 Berkshire sales but less than 150 closed sales.  Reaching 250 closed sales indicates professional competence.
3. Conscious Competence- more than 15 years in the business of selling Berkshire County Real estate, more than 500 sales, advanced trainings and certifications, multiple testimonials from previous clients, a professional business manner which projects competence, a dedicated office environment in which to meet and greet potential buyers and sellers, an outstanding Internet Web Site which ranks at the top of the Google search results (today 90% of home buyers start their search online)

Educational hours required to obtain a real estate license in Massachusetts are minimal.  A Berkshire County Realtor® can hang out a shingle and begin practice with only 40 hours (5 days) training and education. A nail technician can be required to obtain 1200 hours of education.   Cosmetologists require 1800 hours of education.  Your Realtor® will be assisting you with the largest purchase of your life.  Confirm competence before you hire your Realtor® and you will save thousands of dollars on the transaction by benefitting from a master real estate agent’s conscious competence.

Winter in the Berkshires

Berkshire County entertainment  moves to warmer indoor sites in winter and continues uninterrupted in January and February.   Berkshire County is a winter wonderland  during snow ski season.  But our Berkshire Winter entertainment goes way beyond the  sleek slopes and downhill ski runs.  We are sharing this New York Times Article written by columnist Mark Vanhoenacker.  You can read the entire article by clicking the link at the bottom of our page which will take you to the New York Times website.  Wishing you lots of snow and warm fires during this winter season!

For many, the Berkshire Mountains are inimitably tied to one season: summer, when the area’s tandem blooms of high culture and cherished New England countryside draw a devoted global audience to this sparsely populated corner of Massachusetts.