Tag: real estate

Red Flag Warnings

Is it time for you to walk away from your dream home ? Red flags can appear anytime during a house-hunting process and depending on the size of the problem, it may just mean you have to keep searching the MLS. Some slight problems or minor defects can be fixed, but some issues can seriously detract from your investment, and even endanger your health and safety.

Foundation Issues: If your home inspection report lists concerns with the integrity of your home’s foundation, don’t ignore them.  While all poured concrete foundations will crack at one time or another, hairline cracks are not an indication of a problem. If a crack is wider than 1/2 inch, however, it’s a good idea to have a foundation contractor examine the area. This also holds true for cracks that appear to have been recently patched. Large cracks can indicate an unstable foundation. Not all foundation issues are expensive to fix. However, major structural problems that require stabilization using hydraulic piers can cost a lot of money.

Electrical Issues: If a light switch does not work when you flip it, it’s probably just a minor electrical issue that can be fixed later. But, Outdated wiring or too little voltage is cause for concern. Not only will you not be able to hook up all your electronics and appliances, but problems with your electrical setup can also increase your risk for a home fire. Major electrical issues can end up being costly projects that require permits, professionals, and inspections to bring up to code. 

Roofing Issues: A complete roof teardown is a substantial investment, so it’s important to know how old the roof is, particularly important in areas of the country where there is a lot of snowfall since that can shorten the life span of a roof.  Besides the costs of replacement or repairs, leaky roofs can lead to other problems like mold, rot, and water damage. 

Mold: If water damage or mold is found in the home, consider it a red flag. In truth, most homes will have some mold in crawl spaces and attics, and not all mold is bad for your health. But, important: mold can mean there are other problems, like water leaks from the roof or major appliances, that could be costly to correct. It’s imperative that the source of the mold is found. Otherwise, the problem could worsen, and you could end up with a health hazard.

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A Realtor’s Fiduciary Duty

The National Association of Realtors indicates that fiduciary duties cover six distinct areas: loyalty, confidentiality, disclosure, obedience, reasonable care and diligence, and accounting. Some—but not all—of these duties are self-explanatory.

Loyalty means a Realtor must act in the best interest of his clients, including placing their client interests above their own. So, for example, if an agent is interested in buying a house that he knows is perfect for one of his clients, he must give the client priority and refrain from making an offer unless and until the client rejects the house.

Confidentiality means Realtors must safeguard their clients’ secrets. Agents often know the lowest price that a seller-client will take, for example, but the agent must keep it a secret. Likewise, if a seller must sell due to an emergency, the agent may not reveal the seller’s distress. Buyer’s agents must also keep their client’s secrets. For example, the highest price that a buyer is willing to pay and that the buyer loves a given house are secrets.

Disclosure means that the Realtor is required to disclose affirmatively all information concerning the transaction as well as the property which might affect the decisions a principal makes, informing the principal what the Realtor knows.

Obedience requires an agent to carry out his client’s legal wishes. No agent is ever obligated to violate the law. In fact, the law calls for fair and honest dealing, no matter whom the agent represents. So if a seller tells an agent to lie about a leaking roof, he is under no obligation to do so. However, if a seller tells her agent to list a house at a given price, the agent must obey. If the price is unreasonable, the agent should encourage the seller to reconsider the price or do as the seller asks, but the agent cannot list it at a different price.

Realtors are obligated to use reasonable care and diligence in pursuing the principal’s affairs. The standard of care expected of a real estate broker representing a seller or buyer is that of a competent real estate professional. By reason of his license, a Realtor is deemed to have skill and expertise in real estate matters superior to that of the average person. As an agent representing others in their real estate dealings, a broker or salesperson is under a duty to use his superior skill and knowledge while pursuing his principal’s affairs. This duty includes an obligation to affirmatively discover facts relating to his principal’s affairs that a reasonable and prudent real estate broker would be expected to investigate. Simply put, this is the same duty any professional, such as a doctor or lawyer, owes to his patient or client.

The duty of accounting means that the agent must account for money and property entrusted to her. Agents must give escrow funds to their brokers or to the client’s attorney who will keep it in an escrow fund. Listing agents must keep track of showings so that they have a record of who has come and gone. They must also ensure that a listed house is secure, either by signing out keys to other licensed agents and accounting for their whereabouts or by hanging a lockbox on the property.

The Bottom Line: Fiduciary abuse is against the law and can leave an agent open to a lawsuit, and it destroys the professional and ethical standing of the real estate agent. As a Realtor, you should always be aware of your fiduciary duties to your clients. It’s a major responsibility and upholding these duties is crucial to developing a strong reputation.

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Selling & Buying a Home in a Buyer’s Market

Today in the United States, home sales are on the rise as mortgage interest rates remain low. Buyers are looking to take advantage of low-interest rates and sellers are looking to get top-dollar for their home in the low inventory, competitive market.   Is it a buyer or seller’s market?

When the supply of homes exceeds the demand it’s a buyer’s market. The inventory of homes listed for sale is large but there aren’t many interested buyers looking. These conditions give buyers leverage over sellers because when supply is higher and demand lower, the market is forced to respond.

In a buyer’s market, real estate prices decrease, and homes linger on the market longer. Because of this, sellers will need to compete with each other in order to attract buyers. What typically happens is sellers drop their asking prices to gain an advantage in the market and they are ready to negotiate offers to prevent buyers from walking away. A buyer’s market does not mean your house won’t sell. Hire an experienced Realtor to help you get your home ready to show and to price it right to sell.

A few tips for buying a home in a buyers market knowing that it’s the ideal time to buy your dream home because the prices are lower and there are less people to compete with shopping the market:

Don’t rush. This is when you can take your time because with less competition it’s not as much of a concern that you might miss out on a property you like.

Have your Realtor show you as many homes for sale as possible. Knowing what is available on the market is favorable because it will not only ensure that you find the perfect home but give you a greater ability to negotiate on price.

A good Realtor will make sure you are familiar with all the comparable properties on the market and this will help in negotiating the price. Use the comps to your advantage.

Know how long a home has been on the market. The longer it has been available the more power you will have to negotiate for a lower price.

A few tips for selling your home in a buyers market:

Make your home stand out. Take advice from an experienced Realtor on what should be done to accomplish this.

There are more properties out there when it’s a buyer’s market and they will be pickier. If your home needs repairs it’s in your best interest to get them fixed.

Clean and depersonalize each room. If buyers can’t envision themselves living in your home, they won’t make offers. Get rid of any clutter, hire a professional cleaning service and touch up your landscaping to prepare to put your home on the market. Pull out any family photos, papers, souvenirs, or anything else that makes it “your” home.

Find the Realtor that will price your home competitively. Look at all the listings in your area and see what they are offering. Make sure your asking price is either on par with or lower than the comparable homes in your area. And when you do get an offer, make sure that you judge it fairly.

A buyer’s market is the most ideal time to buy a home. You will have the advantage as a buyer. Not only are there more homes to choose from, but you have the power in most negotiations. The ability to walk away from a sale knowing there are probably comparable homes on the market gives you the power. Sellers are more likely to make concessions, drop prices and accept less favorable offers.

If your plans are to buy or sell a home soon, align yourself with a trustworthy Realtor. They are well-versed in market trends and can answer questions you may have throughout the buying or selling process.

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Real Estate and Social Media

It’s critically important, whether you’re working with an agent or selling your home on your own, to market it online. Especially now, during the COVID pandemic where there are limits on visiting homes. Using the MLS will get you the most exposure but you must put your best foot forward. Find the best Realtor and interview her to see how she will take advantage of all the opportunities to get your home in front of people. A good Realtor will have access to the best indoor photographers and understand that photos are more important than ever and they must be showcased on all social media platforms. Most American adults are online. More than 1 billion people in the entire world log in to Facebook on any given day. The potential to reach a huge number of people is exceptional.

On the subject of photographs:  The very best Realtor will help you to stage and prepare your home for professional pictures. All rooms should be clear of any clutter. The pictures MLS displays are usually grainy and of poor quality. Homebuyers more times than not, begin the search for their new home online. Take advantage of this. Stand in the doorway to rooms and snap the photo shooting into the room.  There are never too many photos!

Facebook business page:  Now those beautiful photos need to be posted and announced, showcased, and marketed. The Realtor your choose should have a strong Facebook page with a good following of people. The posts should be shared, linked, and even made into an ad. They should know how to target the ad and pinpoint people by location, interests, behaviors, age, and more. Realtors might even host open houses via Facebook LIVE and interact with people that are watching.

Instagram:  The world’s largest photo-sharing platform is the perfect place to showcase the photos taken of the home.  Instagram Stories are gaining in popularity and selling homes. A powerful and fun way to get information out. The great thing about Instagram Stories is that they are automatically featured at the top of a user’s homepage. The poster can expect their story to generate more exposure than a post in this case.  

The Bottom Line: Everyone wants a Realtor that can be trusted and will do everything she can to get the most money for a home in the least amount of time. The Realtor is the homeowner’s advocate. The marketing of the home should be exceptional.  Beyond using the MLS (Multiple Listing Service) there should be professional pictures to use on websites and every social media platform available.

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Get the Edge in a Seller’s Market

A seller’s market is when there are more people buying houses than there are houses for sale.  If you’re looking to buy a home right now, it may be hard to get one at a fair price. In the most sought-after areas, houses are going under contract in a matter of days, even hours. What can you do to be prepared if you must buy a home now?

Hire the best Realtor

Do a search on Realtors. Get the best, with the most experience, you can find. This will give you the advantage you need in a competitive market as she/he will be on the frontlines, keeping you in the know at all times.

Be ready to act instantly

No matter where you live, listings for homes in popular neighborhoods are often few and far between. When these homes do hit the market, they don’t last long. If your heart is set on buying in one of the more popular areas, starting your house hunt early and having patience means that when the moment comes, you’ll need to act quickly.

If you’re really interested in a home, ask your Realtor to get as much info as you can beforehand: property reports, disclosures, etc. Keep your schedule open so that when a home becomes available, you can get to it immediately. .

Get pre-approved

One of the smartest things you can do to ensure your chances of getting the home you want. This part can very well make or break the process. Assume others will be putting in an offer as well and having a pre-approval letter in your hand will give you an edge.

Having your lender verify your ability to afford a home loan for a certain amount lets the seller know you are qualified and motivated. It shows financial security which gives the seller the confidence to feel that the sale will go smoothly with you.

Keep your offer simple

Most offers include contingencies- things like completing inspections and receiving a mortgage commitment -that needs to happen for the transaction to move forward.

When looking at offers, sellers tend to see contingencies as potential opportunities for the deal to fall apart. As a result, they’re more likely to choose an offer that’s relatively “clean” or reduces their risk of potential hang-ups.

In a competitive market, you might see other buyers removing or reducing their contingency periods to make their offer more competitive.

But remember! If you choose to, for example, waive an inspection contingency, you’re agreeing to buy the home regardless of what problems may exist. You’ve got to be OK with that.

Start with a strong sale price

Besides keeping your contingencies in check, there is another component of the offer that will help set you apart from the crowd and it’s fairly obvious — the offer price.

If it is possible for you, consider putting down a larger deposit which will let the seller know you are serious. Be flexible with the closing date to accommodate the seller’s schedule. And know that the sellers are likely to be enticed by a big payout, or if possible, a cash offer. Offer the asking price – and even more, if you think you can swing it. Use a mortgage calculator to see what your monthly payments will look like.

Write a personal note to the seller

Remember that many sellers have an emotional attachment to their home and moving is often hard for them. They’ve put their heart and soul into the home, built families, and made memories in the home. Write a note letting them know why you love their home and how you plan to take care of it. They may love to hear how their home will be in good hands.

Be prepared to negotiate

The whole experience of buying a home is emotional and if the home you are trying to buy has multiple offers, this isn’t the time to throw in a lot of extras. Keep the contract as clean as possible by not asking for extras such as closing cost changes, home warranties, appliances or furniture.

The Bottom Line: Be flexible. As a buyer in a seller’s market, not everything will go the way you want it to. Be patient. If you are working with the best Realtor, they will have the experience to keep you calm while guiding you in the right direction.

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Real Estate Myths Debunked

Just because you read something on the internet does not mean it is true.  Real estate myths are all too common, however, they can be “debunked” with a proper explanation. Most people only deal in buying or selling real estate only once or twice in their lives. Because of this, myths about the real estate industry abound, causing confusion among new buyers and misconceptions about real estate

Set your home price higher than what you expect to get: As a seller, giving your property a price tag that is higher than the prevailing market price may reduce your chances of getting a good deal for your property. Homebuyers and agents usually do not consider homes that are priced beyond market value. Also, you might consider pulling down the price if you are not able to attract offers in the first few weeks of listing your property for sale. Also, buyers and Realtors often get suspicious about properties that have been on the market for too long.

Experienced agents are always the best ones: It is true that longevity and experience in the real estate business can be some of the indicators of an agent’s competence, but these can certainly not be the sole indicators. Among the essential and imperative traits of a credible real estate advisor are honesty, initiative, listening skills, availability and, most importantly, negotiation skills. Both buyers and sellers look for these qualities in their advisors, rather than the duration of their career.

If buyers don’t like the exterior, they will never consider going inside: It may be true in some cases, especially if the buyer is in a hurry to spot just the right property. But in most cases, buyers are out to get properties that work best for them on multiple counts. If the rest of the features of the house are exceptionally good, they might like to ignore the flaws in exteriors. For instance, even if the exterior is not very appealing, the property might have its desired amenities and features like a great layout, a specific number of bedrooms and bathrooms, a portico, or a backyard. In such cases, the buyer could consider making the purchase and revamping the exteriors later.

Going ‘for sale by the owner’ is the best option: You as a home buyer can choose the route you want to take for finding the right property for yourself. The choice is between hiring an advisor who understands your requirements and takes you on a tour of several selected homes that are relevant. Alternatively, you could access online real estate portals, go through newspaper listings, or speak to people you know are selling their properties, and then go out on your own. 

Agents say and do anything to close a deal: It is a common belief that real estate advisors say and do anything to complete a sale, only to pocket their commission. Though there might be a few aberrations, real estate advisors with a professional approach are ethical people who dutifully toil to get you the best deal. Every agent has different skills, different experience levels, and different traits.

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School District Matters

When it comes to resale value, whether you have children or not, researching school districts is a crucial step when buying a new home. it’s best to invest in a home in a top school district. Living in a good school district doesn’t just bring better teachers, better books, and better test scores — it also can help preserve home values and ensure faster resale rates. These homes often sell faster than homes in lesser school districts. In a case of bad economic times, a home in the lower quality school district declines in home value, while the homes in the top school districts will hold their value.

Do the research. Any information you need for absolutely anything is available online. Do a search to determine the school district or even the specific school, that is the best in the town you will be searching for a new home. There are websites that offer test scores, rankings and demographic information, including student diversity by race and gender, the percentage of students on free lunch programs and the student-teacher ratio, to learn about the schools and school districts you are considering. One of the best ways to dig into specifics on districts you’re considering is by talking to other parents. If you’re moving to an unfamiliar area, Facebook groups and other social media sites can be a way to connect. There’s no better way to get a feel for a certain district than engaging with people who are actually in it. 

A survey on Realtor.com asked random people about their overall buying strategy and how they viewed school performance. The results found that a surprising number of people are willing to give up things to get within the boundaries of a good school district. That, for every five buyers, one buyer would be prepared to give up a garage or bedroom for a good school.

They also found that for every three buyers surveyed, one buyer would even settle for a smaller home to get access to a good school. And over half of those surveyed said they would sacrifice nearby shopping options for a better school.

Beyond sacrificing things in their home purchase, buyers were willing to pay more money for a home in a good school district. One out of five of those surveyed said they would pay between six and ten percent more for a home – and one out of ten people surveyed stated that they’d go even higher, paying up to 20 percent more for a home with access to the right schools.

The Bottom Line: Consult with the best Realtor in the area in which you are looking. The next best resource for neighborhood and nearby school knowledge is your local real estate agent. Even if you don’t have kids, between the Realtor and the research you do, buying a home in a good school district affects the value of the home.

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7 Costly Home Selling Mistakes

There are quite a few mistakes that Real Estate Agents see time and again that can really botch the sale of a home. We rounded up seven here:

1. For Sale By Owner

Trying to sell your home by yourself is sheer madness. Hire a good seasoned Realtor. Homes without representation remain on the market longer and end up selling at a lower price than those with a Realtor leading the way.

2. Pricing

Overpricing or underpricing is a huge and costly error. You may think your home is worth more, but remember to set a realistic price based on comparable homes in the area. This is where a Realtor comes in to help you understand the market you are in. She/he will bring the comps – will know what is currently on the market, know the homes that have sold recently and those currently for sale.

3. Not Making Repairs That Are Necessary

You’ll lose money if you don’t remedy repairs before you list your house. It’s less costly to fix things ahead of time, rather than have buyers see all of your home’s faults at a showing. If you don’t, you’re almost guaranteed that prospective buyers will offer less or ask for a credit back for the work that needs to be done before the deal closes. Think you can get away with hiding major problems with your property? Not a chance. Any big problems will be uncovered during the inspections.

4. Not Cleaning Before a Showing

Don’t worry if you can’t afford to hire a professional to come to clean your home before a showing. There are many things you can do on your own. Create a sense of spaciousness by decluttering. From the kitchen countertops to the overstuffed closets to the trophies, awards, family photos lining the shelves in the family room, it’ll cost nothing to box it all up and store it away. A great idea is to have your Realtor or a good friend come by with a fresh set of eyes. Have them point out areas of your home that need work. Because of your familiarity with the home, you may be immune to its trouble spots.

5. Letting your ego get in the way

Many sellers take negotiating personally and lose out on creating a win-win deal (if not the entire deal). Remember, this is a business transaction — perhaps the biggest one of your life. Nothing kills a real estate deal faster than an over-priced home. Don’t let your ego factor into the listing price. Choose the strongest real estate agent and trust them to guide you to the appropriate square footage cost. 

6. Bad Photographs

Studies reveal that professional real estate photos can help a listing sell faster than comparable homes without professional photography.  Blurry or poor-quality photos can be detrimental when selling your home. Real estate listing photos are particularly important when it comes to using the internet to home shop. According to the National Association of Realtors, 92% of buyers use the internet to shop for a home. Without photos, many homebuyers won’t even bother clicking on an online home listing.

7. Neglecting the Outside of Your Home

After all the work done to improve, clean, and make the inside of your home shine, and then neglect the outside, you run the risk of potential buyers leaving without ever entering your home. The very first impression of your home is the curb appeal or lack thereof. Preparing the exterior of your home is just as important as staging the interior. A fresh coat of paint for the home, shutters, and door goes a long way. There should be no visible weeds, and mowed lawn, pruned trees, and other landscaping. Wash the windows and power-wash your siding and walkways. This should bring buyers through your door, increasing the likelihood of a quick sale.

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Kitchen Renovation Before You Sell Your Home

Thinking about selling your home? Consider investing in upgrading your kitchen. There can be big payoffs. A newly renovated kitchen can help you sell your home for more money and sell your home faster. If it doesn’t help accomplish these two goals, it may not be the best use of your time and money.  In general, you shouldn’t spend more than 5 to 10 percent of the value of your home on the renovations. Spend too much and you won’t get a return on the money you’ve invested.

There are a number of relatively low-cost but high-impact updates you can do to get your kitchen to look its best.

Replace old, outdated kitchen appliances. Go for modern energy-saving appliances, as buyers will appreciate the prospect of having a lower electricity bill. Also, maintain a consistent look among all of the new appliances you purchase, as this will give your kitchen a sense of style and cohesiveness.

Reface kitchen cabinets. This is a much cheaper option than replacing cabinetry, but it does the trick and gives your kitchen a fresh new look.

Replace old cabinet hardware. You would be surprised how far this small measure can go in improving the overall look of your kitchen

Replace an old sink and faucet. Buyers love the sparkling look of a brand new sink.

There are mistakes that shouldn’t be made when renovating your kitchen to sell.

Putting new floors right on top of the old floors. Remove the original floors and replace them.

Most of us know what older cabinets look like. If your kitchen has them, you don’t have to replace them but don’t spend money on beautiful countertops and not update the cabinets. Buyers think they are being “fooled” and can see through it.

Don’t try to save money by choosing lower quality appliances. This may mean that to stay within your budget you can’t get a really cool light fixture that you love, but having good appliances that are energy efficient and durable is more important than having an art piece on the ceiling.

If you are going to spend money redoing your kitchen, make sure you’re choosing projects that will give you the most bang for your buck – without taking shortcuts. A renovated kitchen can totally change the look and feel of your home and may result in a faster and more lucrative sale. Call a knowledgeable Realtor and discuss your goals, and they can help you make the right decision.

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Buying A Home “As-Is”

Many people fall in love with a home that is being sold “as-is” What exactly does “Sold As-Is” mean? Sellers will list their home for sale as-is when they don’t want to do any repairs before closing. It means there are no guarantees from the seller that everything’s in working condition. When you buy an“as-is” home and later find major problems, you’re responsible for the repairs.

“As-is” does not always mean there are issues broken beyond repair. Often there are simply minor and even no issues. It means you are buying the home in whatever condition it is currently in. You can have an inspection done but won’t be able to negotiate to get the repairs done. Having a professional inspect the home before the purchase is important. While you would have to pay for the inspection yourself, it is a small investment to make that can help you avoid thousands of dollars in repairs down the road.

A home that is being sold “as is” is most likely priced lower than its neighbors does not mean you would be getting the home for a bargain. If there are repairs to be made, there will be a cost. Many buyers like these types of homes because there is a good chance there are just relatively minor repairs to be made – such as a new roof – and the home is worth more than they paid for it. Of course if the inspection comes back and there is something huge, like a foundation issue, the deal might be better to avoid.

Getting a loan for a home sold “as-is” is much more difficult and complicated than getting a loan for a home that has gone through the traditional processes. Banks use homes as collateral and any home in poor condition can be grounds for a loan being rejected. Buyers would have to come up with the money on their own. If you are a first time home buyer, purchasing a home “as-is” might not be the best direction.

Hiring the best Realtor to help you navigate the process of buying this type of home will be your best decision. It helps to have someone on your side that can provide good advice and help to know when to back out of a deal if they are sure you will lose a lot of money in the long run. Another bonus of having a Realtor is that they can help with the process of securing a loan as well as figuring out an estimate of the budget you will need for any repairs.

The Bottom Line: There are plenty of homes on the market listed “as-is” that discourage many buyers. Of course, you should be cautious, but “as-is” does not always mean that the house is a money pit. Sometimes the seller can’t vouch for any repair work that has been done – thus an inspection can help and a decision can be made accordingly. Or, the home could have been inherited and the seller is not aware of issues and does not want the responsibility of fixing any problems. Whatever the reason, it’s in the buyer’s best interest to get all the information about the house before an offer is made.

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