Real Estate Articles

Selling a home without the services of a professional real estate agent can be a complex process that requires a lot of time and commitment.

It can also leave homeowners with a few more gray hairs.

First, home sales require complex legal documentation. There are many templates to use, but they skim only the surface of the legalities.

Often the best way for an owner to deal with this issue is to have a lawyer draw up the paperwork after the rough details have been worked out with a potential buyer.

Second, finding a qualified buyer can be difficult.  Agents typically ensures that potential buyers are qualified to buy the property before they cross your doorstep.

Mortgage pre-approvals and extensive consultation typically ensures that the buyer is serious before a showing takes place.

Homeowners have limited access to a potential buyer’s financial qualifications before the sale.

Third, you must assess whether you have the ability to market your home and court potential buyers.

Real estate agents insulate the seller from direct contact with a potential buyer, reducing the emotion involved in the sale.

Using a real estate agent can seem more costly than selling a home on your own, but sellers need to measure whether they are prepared to invest their time and energy into the sale of their home.

When you drive up to your dream home it’s difficult to imagine a substitute residence, especially if you are a first-time buyer. Its curb appeal is unbeatable, you think to yourself.

But there are a number of things to consider before you take the plunge.

Location is one of the big factors.

Even in a down market people are willing to pay more for a home when the conveniences and other features indicate a favorable property.

Check out the conveniences and ask yourself some questions. Is the neighborhood safe? How about the schools? Are they among the best?

Real estate agents used to provide buyers with information about crime and whether the home was in a safe neighborhood, but that may now be more difficult to come by as the National Association of Realtors warned in a recent issue of Realtor magazine that agents should not disclose crime statistics, state that a neighborhood is a safe place to live or mention anything about the quality of the schools.

Why?

Agents must not violate Fair Housing Act steering guidelines. Agents are now suggesting that clients contact police for crime data and set up personal visits to schools for their quality performance data.

Some other things to think about include:

Noises and Smells: Are sounds from trains audible at bedtime? What about fire truck and ambulance sirens? Is freeway or factory noise constant? Are odors from a landfill obvious?

Construction: The city will know if planned roads and open land developments are acceptable.

Be Observant: Is the street a main thoroughfare for kids and teens, especially after school? Chat with neighbors if possible. A walk up and down the street will reveal barking dogs, and too many cars parked in driveways may indicate renters who don’t take pride in maintaining their properties. At night, watch out for drag racers and/or band rehearsals.

A comparative market analysis (CMA) is one of the most important considerations in any real estate transaction. It not only benefits both the buyer and seller, but a properly performed CMA is a critical step in establishing price versus value. Here is what you need to know about a CMA before buying or selling a home:

How It Works

A CMA is typically done by a real estate agent with extensive experience in the property type and location. A careful evaluation of the parcel is done to assess the condition, amenities and unique status of the specific property in comparison with others in the same vicinity. To obtain the best CMA, it is necessary to work with a qualified real estate professional who knows and understands the location.

How It Benefits the Buyer

A CMA helps the buyer differentiate unique aspects of the property so it can be compared with other potential properties in the immediate area. By weighing price, amenities, location and other variables, the buyer is more informed and able to support fiscal and other factors involved in the purchase.

How It Benefits the Seller

An important aspect of selling a property is the ability to price it right. A CMA alerts sellers to comparable properties and helps set an entry price point. Aggressive or highly motivated sellers would want to list their homes at the lower end of the spectrum, while others may take a more leisurely approach by pricing at the higher end but appealing to specific amenities.

Deciding whether to hire a home stager isn’t an easy decision. In tough economic times there’s a tendency for homeowners to cut back on any added fees. However, that could be a big mistake. Research indicates that the need for a home stager is even more important during a buyer’s market as competition is tougher. The following quiz can help you determine if you’d benefit from hiring a home stager:

1.  Does the Sales Price of the Home Place It Into the Luxury or Jumbo Mortgage Range? If so, there’s a good chance you’d benefit from hiring a home stager. Not only is the competition among higher-priced homes even more dramatic than  it is in affordable areas, but potential buyers expect to be impressed.

2.  Does the Property Have Problem Areas? For example, older homes may have eight-foot flat ceilings, smaller bedrooms and other age-related amenities that have fallen out of favor. Hiring a professional problem-solver is a good investment to ensure that you obtain top dollar for your property without breaking the bank.

3.  Was the Property a Cookie-Cutter Model? This is a commonly encountered problem for condo owners and for those who own properties in modest single-family, tract-built neighborhoods where there is limited variation to differentiate one property from another. The challenge is to stand out from the crowd in order to attract attention and seal the deal.

The bottom line here is that in a tough buyer’s market the benefits of hiring a home stager far outweigh the cost.

If you’re thinking about buying a home, it’s best to test for radon before the deal is done.

Home sales often occur at a fast pace, leaving little time to check for such problems. But it’s important to do so in order to avoid difficulties afterwards.

Radon is a cancer-causing gas that has secretly infiltrated millions of homes in the United States. The Environmental Protection Agency (EPA) estimates that it causes thousands of deaths each year.  The Surgeon General reports that only smoking is a greater cause of lung cancer.

Radon gas testing is rapidly becoming a common component in the home inspection process.

Radon is a naturally occurring gas which results from the breakdown of uranium, which is found in nearly all soils.

This radioactive gas typically moves up through the ground, penetrating cracks and openings in your home. Radon can be present in building materials or can infiltrate the home through the groundwater; however, these issues alone are often not enough to cause a substantial radon gas problem.

Testing for radon is relatively easy and inexpensive. Home kits are available for those who want to do it themselves. They are easy to use and accurate. The alternative is to hire a company to test your home or a home you are thinking of buying. The most common method of testing involves the placement of a device in the home for a period of two to 90 days.

Annual testing may be required for homes with a marginal gas reading, as levels fluctuate.

As there’s no known safe level of radon gas, certain upgrades can be made to a home to reduce the levels.

A soil suction radon prevention system uses a vent pipe system with a fan installed to draw radon gas from beneath the house and send it to the outside.

In addition, the foundation, crawl space and other cracks leading into the home should be sealed to reduce the amount of gas seepage.

Condo living often elicits images of carefree weekends sitting beside the pool, but there are some pros and cons to consider before making a purchase.

1. The Lifestyle Itself: One of the biggest advantages of condo living can also become a disadvantage. The sense of community, amenities and other features that originally attracted you to a community may change as your needs and desires change. Make sure you select a condo that truly reflects a lifestyle you will love.

2. Shared Responsibility: A condo association establishes many rules and regulations – typically by majority vote. Likewise, maintenance and repair costs are also shared by members. Things can get dicey when individual members are at odds with the majority. Examine your willingness to abide by rules, regulations and associated expenses to be adopted by the community.

3. Privacy and Autonomy: In some instances, condo living can resemble apartment living with less space and individual autonomy. To make the most of condo living it’s essential for residents to remain involved in the decisions and activities of the community. Those with a need for privacy and autonomy may feel more comfortable with single-family homes or other housing alternatives.

4. Still a Need for Repairs: Many major repairs and maintenance items are taken care of by condo associations, but not all, so condo owners aren’t completely off the hook. Condo owners should set aside a little time to take care of routine repairs and interior maintenance on their units.

The appraisal process can leave sellers in a state of confusion. Unfortunately, lack of knowledge can be detrimental to obtaining the best price and fast closing for even the most competitive properties. Following are some guidelines to follow for best results:

1. Understand the Home Value Code of Conduct (HVCC): The code stipulates that brokers, loan officers and others who earn income from the close of a loan cannot select a specific appraiser or attempt to influence an appraised property value by questioning or disputing the appraisal.

2. Understand the Appraisal Process: Determining the value of a property requires experience in evaluating the local market, type of property and market value. Most appraisers take location, condition of the home, comparable sales in the area and potential income data into consideration when creating a Uniform Residential Appraisal Report or similar form.

3. Delineate the Scope of Work: Determine in advance whether or not you need a limited or complete appraisal, including the intended use of the report, delivery date and who will have access to the appraiser.

4. Don’t Confuse Price With Value: Many sellers confuse asking price with the market value of their home. While the two should relate to one another, they are not necessarily the same. For example, investment income may represent a premium over the market value due to the additional income generated. Ask your agent about special situations that may impact price versus value.

When it comes to buying and selling real estate, timing is of the utmost importance. Unfortunately, it’s also a topic few people truly understand. The following are some tips to keep in mind when speaking with your real estate agent.

Sell before buying or buy before selling?

It’s an age-old question, but asking a few strategic questions might enable you to narrow your decision down to the right choice for your individual situation.

Is selling or buying a necessity or do you have some flexibility?

Job relocation, change of marital status or other life situations often require a relocation within a specified period of time. Equally important are the needs of the other party. Work with your agent to understand the opportunities and limitations of both sides in order to create a win-win situation.

Buying before selling typically benefits those who simply must move or relocate within a specified period of time and who are unable or unwilling to lease or rent. It is also a popular option for those seeking an exchange of property under Section 1031 of the U.S. Internal Revenue Code or for those who are attempting to minimize taxation via other deals.

Can you obtain financing or afford to carry both mortgages for any period of time?

If so, you may have a little more flexibility at your disposal. Speak to your agent about a leaseback or other temporary term. It’s often possible to use these when negotiating terms.
Selling before buying can benefit those who are unable to obtain financing with an existing mortgage in place or who wish to use cash proceeds from the prior sale to fund repairs, renovations or an entire purchase.

In many instances, it is possible to arrange a simultaneous closing for both the home purchased and the home sold with contingencies that reflect this situation on both transactions.

Matters of the heart tend to hurt rather than help the negotiation process when it comes to buying and selling real estate. The following tips will help you manage the emotional ties that bind buyers and sellers to bad decisions.

Use an Agent: Agents do more than just show a home. They provide an impartial and objective opinion about the condition of a property, pricing and comparable real estate on the market.

Establish a Priority List Then Stick to It: Every stakeholder in the buying and selling process should have a priority list that includes needs and wants. Creating such a list helps you stay organized and reduces the risk of becoming emotionally entangled in a bidding war or falling in love with unnecessary yet expensive features that won’t add to the functionality of the home. Ask your agent to focus on finding buyers or homes that meet the main needs on your priority list, and move to the wants later.

Get a Second Opinion: Ask a friend or family member for his or her opinion, especially if you aren’t certain. But be prepared to listen to constructive criticism. Appraisers, inspectors and agents are also vital sources of expert information.

Document: Take plenty of photographs when buying or selling so you can share them with others. Sellers can assist buyers by providing a fact sheet that includes room dimensions, existing warranties, upgrades and other important features of the property. Or buyers can bring along a tape measure and a notebook to jot down important details.

Deciding whether to purchase a fixer-upper or go with a home in need of fewer repairs isn’t always simple.
The following information can help you calculate the true cost of purchasing a fixer:

Supplies, Labor and Time: Whether you do the job yourself or hire outside labor, repairs and renovations are notorious for costing more than you planned. If the home can’t be lived in while repairs are made, the additional cost of covering the mortgage, taxes and insurance while the home is vacant can also substantially add to the total cost.

Taxes and Insurance: Improvements often add to the cost of property taxes and insurance, so be sure to consider the long-term consequences. Properly performed repairs and renovations may help or hurt property tax values and homeowner insurance costs. It’s a good idea to get an estimate in advance. On the other hand, hiring outside crews to perform needed repairs can result in a tax write-off for investment properties.

Long-Term Profit Potential: Repairs and renovations can make your home more valuable, but only if the surrounding area is desirable. Whether investing for long-term appreciation or cash flow, carefully evaluate the desirability of the neighborhood.

Financing: Lenders often have different rates and requirements for properties in need of repair. Find out in advance if you are eligible for special funding, grants or tax incentives, especially when working with affordable housing options or first-time homebuyer programs.

Building Codes and Zoning: It is imperative to understand local building codes and zoning regulations before purchasing a fixer-upper. Never assume you can modify a structure without considering the building code. Likewise, zoning may dramatically alter the ability to use a property in a specific manner or make certain changes or additions. It’s just one more reason it’s more important than ever to work closely with your agent when purchasing a fixer-upper.

Communicating with your real estate agent is the key to developing a winning strategy to show your property in the best possible light.

The following tips might help you avoid frustration and increase the odds of a successful showing:

Be Honest: The first step is to be completely honest with your agent. Make sure the agent knows about the benefits and pitfalls of the property in advance, including needed repairs and deferred maintenance.

Get Organized: The more information about the property you can provide, the better. Make a list of all past repairs, warranties that may still be in effect, improvements made to the property, and what is included or excluded in the sale. Copies of receipts, warranty documents and other paperwork give your agent a great headstart.

Set a Schedule: Let the agent know the appropriate times for showing the home, as well as any other instructions. Notify agents of special situations well in advance, especially concerning pets or other important matters.

Knowledge and Network: Your agent is an expert in the local real estate community, so use him or her to your advantage. Allow the agent to develop a marketing plan and use local resources that maximize the appeal of your property. Likewise, ask the agent’s opinion about service providers and other vendors who may assist in the process of selling or purchasing property.

The decision of whether to remodel an existing home or buy another one has become more difficult because of the price of real estate declining across much of the nation.

A few years ago, the benefits of remodeling were quite simple due to the cost savings. Today it isn’t as straightforward.

The following are some things to think about when deciding whether to remodel or purchase a new property:

Lifestyle: Does your home continue to reflect your lifestyle? Experts agree the home should reflect anticipated lifestyle changes for the next five to seven years. If not, it might be a good idea to consider purchasing a new property.

Maintenance: Does your home require more maintenance and upkeep than desired, especially compared to newer homes? New homes offer the ability to “right size” the levels of yard work, repairs and other needs associated with home ownership.

Cost and Value: There are many factors that can weigh into the cost and value of a given property, including tax credits/write-offs, long-term appreciation, current level of depreciation, access to amenities, property taxes and insurance, utilities, maintenance, and much more. If you are not sure how to properly evaluate the true cost and value of your current property compared to a prospective property, ask your agent to provide estimates of principal, interest, taxes and insurance for comparable properties in the same neighborhood.

Community: Access and affiliation with friends, family and the local community are important when deciding whether or not to remodel or buy new, yet they are easily overlooked by many homeowners.

Depending upon the age of the neighborhood, it may be difficult or even impossible to find other properties in the immediate area.

On the other hand, over time many communities experience a decline in desirability as crime rates, traffic and other problems start to creep in.

Whether you are buying or selling, the language of real estate is often complex and confusing. Following is a plain-language explanation of commonly encountered real-estate-related lingo.

Title: Title to a property essentially denotes ownership interest and is designated by the name(s) on specific legal documents such as mortgages and deeds. The title can be held by an individual, couple or even a corporation.

Deed: A deed is used to transfer ownership of property from one person or entity to another person or entity.

Deed of Trust: A deed of trust is a document that transfers title in a property, with the stipulation that the transfer is contingent upon repayment of an existing loan.

Mortgage: A mortgage is a loan you take out to buy property.

Clear Title: Clear title indicates that the property is free of liens or legal questions surrounding ownership.

Chain of Title: The record of historical ownership of a property. The title company or real estate attorney typically reviews the record in order to determine clear title.

Clouded Title: Any property that has an existing question regarding ownership, chain of title or even liens may have a “clouded” rather than “clear” title, which may adversely impact the ability to obtain financing or properly record the title. Most clouded title issues require a release, court action or other legal intervention to remediate.

If it seems like short sales have suddenly exploded in the real estate arena, it’s not your imagination.

Once considered relatively rare, short sales have become a common phenomenon in the past 18 months, thanks in large part to the banking and mortgage crisis.

To find out if you can benefit from a short sale, here’s some helpful information about the practice.

What Is a Short Sale?

Short sales occur when the bank and seller agree to a purchase price for real estate that is less than the original mortgage amount and does not cover the entire cost of the existing debt obligation.

Who Benefits?

Depending upon how the deal is structured, everyone can benefit from a short sale.

The seller benefits from the ability to save his or her credit rating and avoid bankruptcy or face a mountain of debt, the buyer benefits from acquiring a property at below market price, and the lender benefits from a sure sale that reduces the risk of a property going to auction or of having to foot the bill for foreclosure and additional expenses.

Considerations and Consequences

Short sales are not without consequences, so take time to carefully weigh all options before making a decision.

Sellers need to carefully review the terms prior to signing a final contract.

Some lenders expect the seller to make up the difference between the selling price and the full amount of the original mortgage.

Buyers should also proceed with caution, as many properties have additional liens, deferred maintenance, back taxes or other expensive fees that become the obligation of the buyer.

Additionally, short sales may require substantial time before obtaining final approval, which can make it difficult to lock in favorable rates or result in the loss of other prospective properties.

Home is where the heart is, but everyone knows that the heart of a home is the kitchen. It should come as no surprise, then, that the kitchen is one of the most important considerations prospective buyers have in mind when evaluating property.

Use these quick and easy kitchen fixes to add interest and obtain top dollar for your property without breaking the bank.

Lighten Up. Older homes frequently suffer from low-light conditions, ugly light fixtures and power-hungry appliances. Replace unappealing tungsten bulbs with energy-efficient LED lights for an instant update that looks great and saves money. Invest in up-to-date appliances that improve performance and save money with energy-efficient settings, antibacterial wash modes and enhanced water filtration.

Counter-offer. Replacing countertops and freshening cabinets can be a relatively low-cost way to update your kitchen. Many hardwood cabinets can be easily restored with a coat of paint or quick varnish. Combine this with a new countertop, you can achieve a totally refreshed appearance without the high price. Add some stylish knobs and pulls to complete the look.

Don’t Throw Money Down the Drain. Here’s a quick and easy do-it-yourself job that just about anyone can tackle. Replace that ugly, worn-out faucet with a shiny new fixture to instantly update a focal point of any kitchen. It takes very little time, ensures a sleek new look and eliminates drips and other common faucet problems.

When it comes to selling a home, almost everyone understands the value of working with a knowledgeable real estate agent.

But buyers can often benefit even more than they might expect.

Find out the top reasons more buyers than ever choose to work with an agent when searching for their next home or investment property.

Saves Time

Undoubtedly one of the most commonly cited benefits of working with an agent when buying a property is the ability to save time. Real estate agents do the hard work for you by obtaining all the details and then showing you only those properties that meet your preestablished criteria.

Saves Money

Not only does working with an agent allow you to focus efforts on properties that meet your needs, but research also shows that it actually saves money in the long run. Sellers view agents as more objective during the negotiation process, and buyers that work with agents have access to the best deals. Remember, even in a buyer’s market, the best deals go fast. Many properties are already under contract by the time they make it into the magazines or online MLS listings, whereas many agents send out weekly or even daily updates of newly listed properties.

Reduces Stress

Real estate agents are able to work with lending officers, appraisers and others to streamline the entire transaction and keep things moving along by providing a single, reliable point of contact. Should anything go wrong, agents are able to access their network of contacts and expertise to assist every step of the way.

Access

Some of the best buying opportunities never even make it to the MLS listings; instead, foreclosures, bank-owned properties and even government repossessions are often handled by specific agents. Likewise, agents are often aware of creative finance options or specialized programs that may benefit veterans, first-time buyers, investors or even small-business owners.

Few things are more dreaded than moving day but new storage solutions can ease some of the stress. Learn how to select the right storage space for your needs, based upon your specific situation, without breaking the bank.

Flexible Time. If your top priority is a flexible schedule, a POD might be the perfect choice for you. PODs are large containers that allow you to pack – and unpack – at your own pace. Because PODs are closer to the ground, they also tend to be easier to load and unload.

Long-Term or Transitional Storage. If you are relocating for a job, downsizing or planning to move within a short period of time, longer-term on-site storage might make the most sense. Rather than selling all your belongings or buying a bigger home, shop around for a local self-storage facility within a short distance of your new home. It’s a great way to clear the clutter without sacrificing cost.

Whichever method you select, keep these tips in mind:

Ask about insurance: Don’t assume your homeowners policy covers belongings in storage. Verify it in advance or ask about a rider to ensure that your belongings are fully protected.

Evaluate on-site security: Not all storage solutions are equal – always verify the security measures are in place before making a final decision.”

Climate control. If you intend to store valuable antiques, expensive electronics or other items that may be impacted by high humidity or temperature extremes, consider opting for climate-controlled units instead.

Thanks in part to changing demographics combined with the economic downturn, a major move to get back to the basics is a hot trend in today’s real estate market.

For those seeking maximum value at a minimum price, keep these essentials in mind.

Bigger Isn’t Better: Bigger spaces are associated with higher utility bills, increased property taxes, expensive insurance and even more maintenance concerns. Instead of picking the largest house you can afford, search for the one with the amenities that your family will truly use.

Good Neighbors in Great Hoods: Friends, family and wonderful neighborhoods are major attractions. In fact, research shows that homes located in top-rated school districts routinely fetch 10% or more than do similar-sized homes in less desirable districts. Family-oriented neighborhoods with parks and other amenities are highly desirable, while empty-nesters can save thousands by searching for similar homes outside of popular school districts.

Fruit Trees and Gardening Are a Big Trend: Throughout the nation, high-maintenance lawns are giving way to eco-friendly (and budget-happy) gardens, fruit trees and other down-to-earth activities. Ask about HOA restrictions and the cost of water bills prior to buying with the intent of starting a garden.

Going Green Is Bigger Than Ever: From energy-efficient appliances to environmentally friendly building materials, green is not only “in” but bigger and better than ever. Save thousands of dollars by searching for homes that have already implemented upgrades like LED lighting and Energy Star appliances.

Entertaining: As the economic excess of recent years continues to drive down the market, people are interested in entertaining, exercising and even eating at home more. Focus on properties that support your interests and lifestyle for today and tomorrow. Remember, the average person remains in a home for seven years, so buy right to make sure that your next house truly feels like home.

It’s only natural for your home to reflect your personal style, but when it comes time to sell, what makes a house a home becomes a major hindrance. Learn how to depersonalize your home in order to obtain the best price.

Go Neutral: Unless your favorite color scheme is completely neutral, it’s time to get out the paint and restore the color to something less noticeable. Eggshell, white tones and beige are good options. Don’t forget the other senses – in addition to color, make sure that the smell of your home is also neutral. Never assume that what you find pleasant smelling will appeal to others. Instead, have your home professionally cleaned using an enzymatic treatment that neutralizes all odors, including heavy perfumes and deodorizers.

Minimize: Eliminate all unnecessary furniture, belongings and clutter as much as possible prior to photographing and showing the home. Not only does it allow people to see the property more clearly, but it helps break down the mental and physical barrier separating buyers from seeing the house as their own.

Highlight the Home: Never showcase personal belongings – instead, highlight the home itself. Tour the house room by room to discover the essence of each area. Create a beautiful view, ambient lighting or other inviting scenario that attracts visitors without overwhelming them. Eliminate distractions that identify the home as belonging to you while allowing them to see themselves living in the house.

Thinking about selling your home but worried about the competition?

Whether you live in a cookie-cutter neighborhood where every home looks more or less the same or you simply need a few fresh ideas to help your home stand out from the rest for sale on the same street, use these simple tips to make it the best on the block.

Tackle Trouble Spots

Like every home, yours has a few trouble spots that you have probably learned to live with.
Unfortunately, time might make the heart grow fonder, but unfortunately it rarely helps sell a home.
Have an independent appraisal performed and pay special attention to needed repairs, deferred maintenance and any “ugly” areas.

Invest in fresh paint, plants and other quick fixes designed to enhance curb appeal.

Find a Focal Point

Make sure there is something memorable about your home from the moment prospective buyers see the front door until they leave.

Avoid candles, fresh flowers or other potential allergy or chemical sensitivity triggers and opt for neutral yet elegant décor or decorations instead.

Every room should capture attention while inviting visitors to explore.

Make It Theirs

Remember, attract – don’t detract. Clear clutter and make sure each room is open enough that buyers are able to envision their belongings in the room – not yours.

Neutral colors, natural lighting and a casual ambiance combined with simple yet inspiring plants, paintings or other props help create a “special spot” they will want to call home.

Price It Right

Buyers will often look at your house only if the price is right. It’s easy for them to compare the price of your house with the prices of others on the street, so it’s essential to make sure yours is priced competitively.