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Perks of Selling or Buying a House Over the Holiday Season

November 16, 2017

Photo © Studio D – Adobe Stock

 

Spring is often considered the best time of year to sell. Families can find their dream house, make their purchase, and move in all before the new school year starts. But there are perks for home buyers and sellers who decide to list at the end of the year.

Perks for Sellers
Since most sellers wait until spring to list their home, there are typically fewer homes available for sale over the winter holidays, which means less competition. If sellers price their home competitively and stage it right, they can make their house stand out from the sparse crowd, catching the attention of more buyers.

When You’re Selling…
You can still celebrate the holidays but keep it simple. Instead of hosting a large party, invite a few family members and friends for a quiet dinner in, or head to a restaurant to keep your kitchen tidy and open-house ready. When decorating, remember that not everyone celebrates the same holidays in the same way. Stick to more neutral decorations that transcend any religious event like candles and winter flowers such as paperwhites and poinsettias. Whatever decorations you use, keep them to a minimum so your house remains the center of attention.

Perks for Buyers
Despite the limited selection, buyers can also benefit from purchasing over the winter holiday season. Often a homeowner will put their house on the market in winter because they can’t or won’t wait until spring—that is, they need an immediate sale. Buyers who purchase during the winter holidays might find sellers more willing to negotiate on price or contract terms.

When You’re Buying…
Buying a house is stressful enough without the added pressure of celebrating a family holiday at the same time. To enjoy the season, prepare for your purchase in advance. Before you start your home search, figure out what type of home you want and where it should be located. Decide on a budget and get preapproved for a mortgage. And don’t RSVP “yes” to every party invitation you receive; you will need to keep some time available for viewing homes with your agent.

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117.

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7 bogus pricing myths sellers shouldn’t fall for

November 9, 2017

 

Weighing sellers’ expectations against market realities can be a delicate dance

  • Sellers tend to overprice and spend a tremendous amount of effort trying to defend their price, even if the market doesn’t support it.
  • Pricing a home correctly is a partnership between sellers and their agent, not a battle of wills.

When it comes down to it, the most important advice a real estate agent can give sellers is how to price their home. No matter how beautiful or well-maintained a property may be, how many upgrades it has or how well it shows, if a home is not properly priced, it’s going to be a tough sell.

The battle for agents most often lies with aligning what sellers’ think their home is worth with its true market value.

These disparate realities can be difficult to merge when working with a seller to set a list price or on a price adjustment.

Here are seven pricing myths that often get in the away:

1. It is better to price the home on the high side because the seller can always come down. If buyers are interested, they can make an offer.

Well, not quite. If a home is overpriced, a seller risks losing potential buyers who aren’t stretching their search into an uncomfortable price range.

The asking price sets the stage and may invite or dissuade buyers based on the dollar amount. Just as you would painstakingly prepare your home for sale, you never get a second chance to make a first impression price-wise.

2. If a home is priced just right, a seller risks leaving money on the table. 

Actually, the opposite is true. A well-priced home tends to generate a lot of interest and can result in multiple offers.

A shorter marketing span brings strong offers that could result in a home selling for over asking price.

Buyers are less likely to play “let’s make a deal” and nit-pick every little thing; they feel the urgency of competing with other interested parties for the same house.

3. The price gets better with time. If it doesn’t sell this time, the seller will get a better price by re-listing next spring, next summer, etc.

It has been said before, but it needs to be said again: A home that sits is not like fine wine — it does not get better with time.

The longer a home stays on the market, the more likely buyers are to question its value.

Subsequently, any offers that come in tend to be perceived as too low by an already-frustrated seller who thinks there weren’t any buyers for their home while it was on the market the first time.

Granted, some seasons can be better than others — and that really depends on where a home is geographically located.

Trying to attract maximum traffic in the dead of winter may not be the best strategy, but if priced aggressively, a seller may just get that serious buyer who is ready to close.

Waiting to re-list again may mean competing with other houses on the market that are both nicer and offer more bang for their buck.

The additional carrying costs of a mortgage, maintenance and upkeep as well as the possibility of needing to make repairs to an aging roof or AC system eat into the profitability of commanding a better price next year.

If the home is somewhat dated on the inside, price out the cost of replacing granite counters, updating appliances, repainting and other upgrades, and it will likely be much less expensive to adjust the price without as much hassle.

4. X price is as low as the seller will go.

When faced with an offer that is less than what they want, sellers love to draw a line in the sand and dig their heels in over an arbitrary number that they deem to be “their bottom line.”

Who decides what a property is ultimately worth anyway? Buyers see the glass as half empty versus half full, and in some markets and real estate cycles, they are holding the cards.

Sellers can decline an offer based on a number, but they may never get there with another buyer, and a subsequent offer may be lower or layered with conditions and complications.

5. An offer should come in close to asking price.

Sellers are often disappointed at the initial price when an offer is received and ask “why so low?”

Does a seller really think a buyer is going to be generous with their initial offer?

Unless it is a really hot property, priced aggressively or in a low-inventory market, no buyer is going to willingly offer more than they have to, especially on a first pass. They want to get a sense of the seller’s flexibility or lack thereof before deciding their next move.

6. Outdated features shouldn’t impact the selling price.

So the home has “upgrades” circa 1990 with white melamine cabinets, beveled edge laminate counters and builder grade 12-by-12-inch tile with brass fixtures, and the seller expects the buyer to pay full asking price or close to it?

Reality check!

The buyers are looking at how much they are going to have to spend to bring the home up to today’s standards and are going to deduct accordingly when formulating an offer.

7. The buyer’s offer is simply too far off the asking price to counter.  

A bird in the hand is worth two in the bush. A buyer has stepped up and put pen to the paper with a proposal. An offer is an invitation to negotiate and begin discussions about the property.

It can be easy to get offended, but it’s best to keep emotion out of negotiation as much as possible and work in good faith with what’s presented. A seller will learn quickly if it looks like a deal may come together.

Pricing a property is a delicate dance. The bottom line is that the market doesn’t guarantee as strong a price as sellers usually want or expect — unless the home is a highly sought after, rare type of property.

Setting the stage with the right pricing will often set the tone for how smoothly the listing experience will unfold.

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more.Just send me an email or call me at 619-888-2117. 

Meet Me Outside

November 2, 2017

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117.

How to File a Homeowners Insurance Claim After a Fire

October 26, 2017

By Tobie Stanger:  Consumer Reports

Follow these tips to make sure you’re compensated correctly:

The wildfires in California have destroyed hundreds of homes and businesses. It’s a catastrophe that could happen anywhere, but if you have a homeowners insurance policy, which covers all kinds of fires, including wildfires, you’ll be covered.

The road to recovery, however, won’t start until you get in touch with your insurer or the agent who sold you the homeowners insurance so you can make a claim.

The insurance company will then assign an adjuster, who will assess the damage and submit an estimate for review by the insurance company.

The amount you’re paid will depend on the kind of coverage you have. While “replacement cost” coverage should cover the cost of repairing or replacing your home and any lost or damaged items, “actual cash value” coverage will pay you the value of your home and the damaged items inside, less depreciation.

To make sure you get your due, follow these tips:

Document all losses. After the fire, take plenty of photos of the damage and make a list of items that were destroyed or are in need of repair. Include the amount you paid for the items and gather any receipts you can find. “The more of that you can do before the adjuster arrives, the faster the process will go,” says Jeanne Salvatore, a spokeswoman for the Insurance Information Institute, which represents the property and casualty insurance industry.

Verify the adjuster’s identity. After natural disasters there can sometimes be scammers trying to make money off your misfortune. To reduce the chance of being scammed, ask the insurance company for the adjuster’s name before he or she arrives, and then ask for identification before letting the person into your home.

MORE ABOUT HOMEOWNERS INSURANCE

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Show the adjuster all the damage. Make sure that you are home when the adjuster visits and that he or she gets a complete view of everything that was lost or damaged. It’s not enough just to walk through part of your home.

Document all contact with the insurance company. After the adjuster leaves, remain in contact by email so you have backup of all your communication. Keep notes about when an adjuster visits as well as any missed appointments, unreturned phone calls, what you discussed, and even if he or she was rude. While you probably won’t need this information, it will be useful if any disagreements have to be resolved in court.

Make copies of all documents. Copy everything you give to the adjuster, such as your list of property lost or damaged. If the adjuster advises you to start repairs, get that permission in writing, advises Steve Mostyn, an attorney in Houston who represents consumers against insurers.

Mostyn says that in an emergency situation, the first adjuster may be replaced by a new one during the claims process, so having correspondence in writing could be helpful to you. “There’s often not a good hand-off of information when the next adjuster comes in,” he explains.

Get additional estimates if necessary. If you have custom work in your house, an adjuster may not know how to properly estimate the value. Get an outside estimate from a contractor.

Discuss any exclusion or limits in your policy. If your insurer maintains that your policy doesn’t cover all the damages or if you think the compensation is too low, ask the carrier’s representative to explain in writing how he or she got to the estimate. The rep should also include any reasons for why certain items aren’t covered and whether there are any coverage limits.

If you feel the wording in the policy is misleading, contact a local plaintiff’s attorney who specializes in insurance law. The Consumer Federation of America notes that courts have consistently ruled in favor of policyholders on policy ambiguities. File a complaint with your state’s department of insurance.

Consider Hiring a Public Adjuster

If you have a very large claim, you may want to turn to a public adjuster, an independent adjuster who works on your behalf and represents you on the claim. But be aware of fees. In some states a public adjuster’s fees are capped, typically at 10 to 12 percent of the insurance payout. In other states there are either no caps or adjusters simply charge a flat fee.

To find a public adjuster, check with the National Association of Public Insurance Adjusters. When you reach the adjuster, ask for references from past clients and look to see whether he or she has several years of experience and a state license where required.

In the five states where no licensing is required—Alabama, Alaska, Arkansas, South Dakota, and Wisconsin—contact an attorney who works with catastrophe victims to help you find a reputable adjuster, suggests Diane Swerling, vice president at Swerling Milton Winnick Public Insurance Adjusters in Wellesley, Mass.

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more.Just send me an email or call me at 619-888-2117.

 

8 Costly Missteps New Homeowners Make in Their First Year

October 19, 2017
 




The negotiations are over. Your mortgage is settled. The keys to your first home are in hand.Finally, you can install your dream patio.You can paint the walls without losing your security deposit.Heck, you could knock out a wall. You’re soooo ready to be a homeowner.

So ready in fact, you’re about to make some costly mistakes.

Wait, whaaat?

“You have to rein it in and be smart,” says Daniel Kanter, a homeowner with five years under his belt. Especially in your first year, when your happiness, eagerness (and sometimes ignorance) might convince you to make one of these eight mistakes:

#1 Going With the Lowest Bid

The sounds your HVAC system is making clearly require the knowledge of a professional (or perhaps an exorcist?).

But you’ve been smart and gotten three contractor bids, so why not go with the lowest price?

You might want to check out this story from a Michigan couple. Rather than going with a remodeler who’d delivered good work in the past, they hired a contractor offering to complete the work for less than half the cost, in less time.

A year later, their house was still a construction zone. You don’t want to be in the same spot.

What to do: Double-check that all bids include the same project scope — sometimes one is cheaper because it doesn’t include all the actual costs and details of the project. The contractor may lack the experience to know of additional steps and costs.

#2 Submitting Small Insurance Claims

Insurance is there to cover damage to your property, so why not use it?

Because the maddening reality is that filing a claim or two, especially in a relatively short period, can trigger an increase in your premium. “As a consumer advocate, I hate telling people not to use something they paid for,” says Amy Bach, executive director of nonprofit United Policyholders, which works to empower consumers. But, it’s better to pay out of pocket than submit claims that are less than your deductible.

Save your insurance for the catastrophic stuff. “You want the cleanest record possible,” Bach says. “You want to be seen as the lowest risk. It’s like a driving record — the more tickets you have, the more your insurance.”

Some insurance groups, like the Insurance Information Institute and National Association of Insurance Commissioners, say it’s hard to generalize about premium increases because states’ and providers’ rules differ. But this stat from a report by UP and the Rutgers Center for Risk and Responsibility at Rutgers Law School is pretty sobering: Only two states — Rhode Island and Texas — got top marks for protecting consumers “from improper rate increases and non-renewals” just for making:

  • An inquiry about a claim
  • A claim that isn’t paid because it was less than the deductible
  • A single claim

Your best protection? Maintaining your home so small claims don’t even materialize.

#3 Making Improvements Without Checking the ROI

Brandon Hedges, a REALTOR® in Minneapolis-St. Paul, recalls a couple who, though only planning to stay in their home for a few years, quickly replaced all their windows. When the time came to sell, he had to deliver the crushing news that they wouldn’t get back their full investment — more than $30,000.

New windows can be a great investment if you’re sticking around for awhile, especially if windows are beyond repair, and you want to save on energy bills.

Just because you might personally value an upgrade doesn’t mean the market will. “It’s easy to build yourself out of your neighborhood” and invest more than you can recoup at resale, says Linda Sowell, a REALTOR® in Memphis, Tenn.

What to do: Before you pick up a sledgehammer, check with an agent or appraiser, who usually are happy to share their knowledge about how much moola an improvement will eventually deliver.

#4 Going on a Furnishing Spree

When you enter homeownership with an apartment’s worth of furnishings, entire rooms in your new home are depressingly sparse. You want to feel settled. You want guests at your housewarming party to be able to sit on real furniture.

But try to exercise some retailing willpower. Investing in high-quality furniture over time is just smarter than blowing your budget on a whole house worth of particleboard discount items all at once.

What to do: Live in your home for a while, and you’ll get to know your space. Your living room may really need two full couches, not the love seat and a recliner you pictured there.

#5 Throwing Away Receipts and Paperwork

Shortly after moving in, your sump pump dies. You begrudgingly pay for a new one and try to forget about the cash you just dropped. But don’t! When it comes time to sell, improvements as small as this are like a resume-builder for your home that can boost its price. And, if problems arise down the road, warranty information for something like a new furnace could save you hundreds.

What to do: Stow paperwork like receipts, contracts, and manuals in a three-ring binder with clear plastic sleeves, or photograph your documents and upload them to cloud storage.

#6 Ignoring Small Items on Your Inspection Report

Use your inspection report as your very first home to-do list — even before you start perusing paint colors. Minor issues that helped take a chunk of change off the sale price can cause cumulative (and sometimes hazardous) damage. Over time, loose gutters could yield thousands in foundation damage. Uninsulated pipes? You could pay hundreds to a plumber when they crack in freezing temperatures. And a single faulty electric outlet could indicate dangerous ungrounded electricity.

What to do: Get the opinion and estimate of a contractor (usually at no charge), and then you can make an informed decision. But remember #1 above.

#7 Remodeling Without Doing the Research

No one wants to be a Negative Nancy, but there’s a benefit to knowing the worst-case scenario.

Homeowner Kanter tells the time he hired roofers to remove box gutters from his 1880s home. Little did he know, more often than not aged box gutters come with more extensive rot damage, which his roofers weren’t qualified to handle.

“We had to have four different contractors come in and close stuff up for the winter,” he says. Had he researched the problem, he could have saved money and anxiety by hiring a specialist from the start, he says.

What to do: Before beginning a project, thoroughly research it. Ask neighbors. Ask detailed questions of contractors so you can get your timing, budget, and expectations in line.

#8 Buying Cheap Tools

You need some basic tools for your first home — a hammer, screwdriver set, a ladder, maybe a mower.

But if you pick up a “novelty” kit (like those cute pink ones) or inexpensive off-brand items, don’t be surprised if they break right away, or if components like batteries have to be replaced frequently.

What to do: For a budget-friendly start, buy used tools from known quality brands (check online auctions or local estate sales) that the pros themselves use.

By: Amy Howell Hirt, ClientDirect

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more.Just send me an email or call me at 619-888-2117.

Buyers Aren’t Spooked by Haunted Houses

October 12, 2017

 

With inventories so tight, many consumers say they’re even willing to live in a haunted house.

Thirty-three percent of more than 1,000 consumers recently surveyed say they’re willing to live in a haunted house, and another 25 percent said they’d consider it, according to a newly released survey by realtor.com®.

“Haunted houses are a popular attraction this time of year, but we wanted to see how many people would actually live in one,” says Sarah Staley, a housing expert who commented on the study’s findings. “What we found may be a sign of today’s tight housing market, or for many living in a haunted house doesn’t have to be a deal breaker.”

Further, 47 percent of respondents said they’d live in a home where someone has died, and 27 percent additional respondents said they’d at least consider it, according to the survey.

Still, 40 percent of consumers said they’d need a price reduction in order to choose a haunted home over a non-haunted home. Also, a good neighborhood, extra square footage, and more bedrooms would convince them too, according to the survey. On the other hand, 42 percent of respondents insist they aren’t open to the idea of buying a haunted home, even for those extra perks.

For some consumers, living in a haunted house may not be considered a stretch because they claim they’ve already lived in one. For example, 28 percent of respondents said they have lived in a haunted house, and another 14 percent think they may have. They say their house was haunted because of strange noises, odd feelings in certain rooms, and even some reports of objects moving or disappearing.

Source: realtor.com®

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more.Just send me an email or call me at 619-888-2117.

Before Buying, Real Estate Pros Insist on Doing These 4 Things

October 5, 2017

One house you’re looking at has the wraparound porch you’ve fantasized about, but it’s on a high-traffic street. The condo you like has a doorman in the lobby (you can order online now!), but it has no dedicated parking. What to choose?It’s not every day that you buy a home and make decisions about the next three, five, or 10 years of your life. Since you can’t exactly take a home on a test drive, how do you decide? That got us to thinking about real estate pros. When they’ve seen practically everything on the market, how do they choose?

Four pros who’ve seen it all share their advice and their stories of hunting for just the right home.

Compromise for Your Priorities

Veteran real estate agent Nancy Farkas knew exactly what she wanted in her home: ranch style, three bedrooms, high ceilings. But you know what she bought? A two-story Colonial.

Huh?

For Farkas, an associate partner with Coldwell Banker Heritage REALTORS®, in Dayton, Ohio, the home’s location and price trumped style. “I had a dog I had to go home and walk at noon, and the house was close [to work] and the right price,” she says.

Her advice: Make sure your practical and functional priorities don’t get lost in all the home buying hoo-ha (sparkling granite counters, new hardwood floors, a steam shower!). Remember, you can always add the hoo-ha, but you can’t make a home fit all priorities, such as location and price.

Dig Into the Details (Dull, Yes, But Worth It!)

When Grigory Pekarsky, co-owner and managing broker with Vesta Preferred Real Estate in Chicago, was looking for his first home, one of his priorities was to minimize his maintenance costs. He made sure to find out if the house had a newer roof, good siding, and a newer furnace. But he recommends you go even deeper to uncover a home’s not-so-obvious maintenance costs:

  • Scope out the sewer line – especially if you’re interested in an older home — to make sure there aren’t any tree branches or other debris clogging up the works. Otherwise, you might find some nasty sludge in the basement.
  • Look at the trees. How mature are they? Roots from older trees can invade the sewer line; untrimmed branches can pummel your gutters during storms.
  • Know what’s not covered by homeowners insurance.“I learned seepage isn’t covered. Shame on me,” he says.
  • Ask how old the appliances are.You might need to budget for something new in a few years. Sellers are only required to fix what the inspector finds is broken; they’re not going to upgrade working appliances for you.

Seek a House That Matches Your Lifestyle

Having lived the high-rise apartment life as a renter, Pekarsky knew a single-family home was just what he wanted. He was tired of living in a relatively small space with no yard. He wanted a house he could “grow into in the next three to five years.” That meant multiple bedrooms and bathrooms for the family he plans on having. So what he bought — a three-story, single-family with a finished attic bedroom (shown below) on Chicago’s North Side — suits his lifestyle perfectly.

In addition, “you get the biggest value from owning the land,” he says. “In a single-family [home], people aren’t telling you what to do with the investment.”

On the other hand, Matt Difanis wished he’d bought a condo when he bought his first home, a small bungalow ranch in a charming, historic neighborhood in Champaign, Ill. It was first-home love — until it rained.

“If I didn’t clean out the gutters before every rainstorm, the basement would leak,” says the broker-owner of RE/MAX Realty Associates in Champaign. He didn’t realize that taking care of a single-family home wouldn’t be his cup of tea. “I should have opted for a condo without gutters to clean and a lawn to mow,” he says.

Agent Amy Smythe Harris of Urban Provision REALTORS®, in Woodland, Texas, bought a home with a sizable downstairs suite her parents could use now (and she could use years from now). She says her millennial clients aren’t forward-thinking about their lifestyles. Some are childless and say they don’t care about schools, pools, and tennis courts. Then they become parents a few years later and have to move.

“Once they have kids, the first question [they] ask is about school districts, and the second is about where the parks and pools are,” she says.

The pros’ bottom-line advice: Think of your lifestyle preferences and how those might change in the next few years. After all, the typical homeowner lives in a house for a median of 10 years before selling, NATIONAL ASSOCIATION OF REALTORS® data shows.

Look at the House Through the Lens of Resale

All the real estate pros we talked to — no surprise here — emphasized resale. Take appraiser Michelle C. Bradley of Czekalski Real Estate Inc. in Natrona Heights, Pa. When she built her current home — a 2,200-square-foot ranch — she included a full, unfinished basement, even though she has no use for one and rarely ventures into it.

Why would she do that? Because basements are standard in her southwest Pennsylvania market. But Bradley’s not going to finish the basement until she’s ready to sell. That way, she avoids having to clean it and ensures she’ll install the most fashionable bathroom fixtures at sell time.

Her advice: “Don’t buy or build something unique that you can’t resell. If you’re not in an area with log homes, don’t choose a log home. If you’re not in an area with dome homes, don’t choose a dome home.”

Likewise, don’t buy a home that’s not in line with the neighborhood’s average price. When you go to resell, you’ll find yourself in an uphill battle to maintain your higher price.

Other advice from the pros: Watch out for unfixable flaws that could affect resale, like:

  • What’s next to the home, such as vacant land that could be developed, high-traffic businesses, noisy power generation stations, a cell tower, etc.
  • Lot issues, such as a steep driveway that could double as a ski slope in winter, or a sloped yard that sends water special delivery to your foundation.

Of course, a home isn’t just about resale. It’s just one factor to consider. Remember the first point: Be willing to compromise for your priorities. If the home meets your priorities and you’re going to stay there awhile, then resale might be where you compromise.

By: By: Dona Dezube and Christina Hoffmann, ClientDirect



Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

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