Searching For Your New Home

You want a home. There are houses for sale. How hard can it be to find the right fit? For anyone who has house hunted before, you know the answer. It can be a time-consuming and difficult process if you don't know where to start. In order to get started in the right direction, it's paramount that you have a good idea for what you're looking. Make a wish list that includes everything from your neighborhood preferences and budget to housing amenities. "What if I don't know what I want?" you ask. There are buyers out there that just aren't sure if they're in the market for a condo or a single-family home. They don't know if they want to be near downtown or out in the 'burbs. If this sounds like you, then your agent can be a big help. They can show you a few different options, explaining the pros and cons of each. Hopefully, this preview session will help you make a firm decision on the direction you're headed. Next, learn how to navigate your local MLS. In today's technology age, it's all about previewing a house online before you take the time to go on a showing. Just because a house meets the criteria you've set forth for your agent doesn't mean it's a house you'll want to see in person. Realtor.com is a good place to start. They display all the listings for your area, searchable by bedrooms, square foots, bathrooms, zip codes, price range, and more. Has your agent sent you listing info containing an MLS (Multiple Listing Service) number? You should be able to input that number on the MLS website to take you directly to that particular listing. Better yet, have your agent sign you up for daily or weekly email updates. They can send you links to newly listed homes that fit within your given wish list criteria. Finally, have an open mind. Some houses look stellar on paper (online). They appear to be your dream home. Once you see them in person, however, they simply don't measure up. The opposite can be true for houses as well. A house may look shabby and run-down online (perhaps due to bad photos or bad decorating), but in person you realize the neighborhood is perfect and the house sturdy. All it needs are some cosmetic fixes. Don't keep second guessing yourself. If from the beginning you have a solid plan on what you want, you'll be more likely to make a decisive move when the time comes. Waiting too long could mean losing out on a home you really want. Being realistic about your wants and budget is a good way to make the house hunting process a whole lot smoother. Keep in mind that there may not be the perfect home, but there will be a home that is right for you.

Written by Carla Hill

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Real Estate Market Offering Good Opportunity For Buyers

In some areas the real estate market is "hopping". New homes are being sold faster than they can be built and some new homeowners are purchasing great properties for a lower price than five years ago and with a very low interest rate. That's making today's buyers feel more secure about their investment.
If you're a buyer watching the real estate market and wondering if it's poised for a very strong recovery, here are a few things to think about. The already low interest rates look like they'll be around for a while longer. According to the Federal Reserve, more mortgage-backed securities and bonds will be purchased. Currently its purchasing about $45 billion a month. What this could mean is that interest rates could go even lower. Keeping the interest rates low is a strategy to encourage people to enter the real estate market again. Even though in some areas there have been reports of bidding wars, some buyers still believe the market is somewhat unrealistically high. They're, of course, hoping for lower prices. As buyers wait things out that causes more stress for sellers who are in a precarious position of potentially missing a mortgage payment on an already "underwater" home. On the rise are home modifications and short sales. Banks and mortgage servicers are realizing it's better to work things out together than foreclose. Government laws are also helping homeowners in crisis. The law that allows tax relief for mortgage debt forgiveness (from homes that fell victim to short sales, foreclosures, or "phantom" income on loan modifications) has been extended another year. Meanwhile banks are still taking a hit from the government. It's expected that billions of dollars of fines, fees, and settlements are still coming. Financial practices are being scrutinized and a federal watchdog group created in 2010 is ensuring legal financial practices are used. Trouble for some is success for others. Right now, the temptation is great for buyers interested in some deep discounts. According to RealtyTrac, the online entity that tracks foreclosed properties, homes sold in foreclosure nationwide were, on average, 39 percent lower than conventional sale prices during the fourth quarter. Some markets offered even greater discounts on home prices. Short sales also offered a good price for buyers, averaging 23 percent below market. However, if you decide to purchase a foreclosure or a short-sale home, you should know that these homes may be in poor condition. If the property is purchased by a buyer who wants to live in the home, this can be challenging. Getting through the laundry-list of repairs will require some extra income other than that used for the downpayment of the home. But you could get a very good price if you're willing to live with some of the home's issues. Some of the areas that often top the list of necessary repairs for these types of homes are in the plumbing, heating, and air conditioning systems. Also, damage to the roofs, ceilings, and walls may be from the property being vacant for a long time and/or vandalized (in some cases by the angry former owner). If you can find a home at a discounted price and you have the ability, patience, and money to do the repairs, this is a very good time for you to start your hunt. Just be sure to have the home inspected carefully and completely understand the condition of the home that you are buying.

Written by Phoebe Chongchua

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

 

Preparing To Buy A Home Preparing to buy a home is a bit like preparing to go on a very long journey. You have to have your finances in order, know where you're going, what you're hoping to accomplish and how much time and how much money you can afford to spend. Financial matters. When it comes to owning real estate nothing is more important, for obvious reasons. As we've seen, if you get locked into a mortgage you can't afford, the result can be devastating. But even if you can afford the mortgage, you might not want to be "house rich and cash poor". You have to consider other things that are important to you such as travel and your spending habits. If for instance, you like to travel for months at a time, it might be wise to consider a smaller house with a less expensive mortgage instead of a large home with a big mortgage, which could cause you more work and less financial ability to spend on other things you like. Another consideration is the length of time you want to have the mortgage. Many young people choose a 30-year fixed mortgage but if you're a senior citizen you might want to opt for a 15-year loan. The best thing you can do is make a list of your financial matters and the questions you have about buying a home and then consult with a highly experienced loan officer. A knowledgeable loan officer can be like having a tour guide with you all the time in a foreign country where you don't speak the language. The jargon used in the mortgage industry documents can be confusing. Having someone who can clearly explain the documents, what to expect, the time frame, and the process is priceless. Debt-to-income. The ratio of your debt-to-income is vital when purchasing a home. These guidelines have become more strict since the housing crisis so it's critical to consult with experts about your personal financial situation. Generally speaking, you should have a debt-to-income ratio of no more that 36 percent–meaning all you owe (including your mortgage, taxes, and insurance) should not equal more than 36 percent of your income. Remember there are still monthly expenses of your home on top of your debt. And, of course, the less you owe and the more you make, the better position you're in for buying a home and creating your own financial freedom. These days, along with keeping your expenses and debt manageable, a key factor to buying a home is having a healthy downpayment. Most lenders would consider 20 percent a good downpayment. The more you bring in, the less you have to borrow. Remember the collapse of the housing market was brought on by small or no downpayment loans and many buyers who simply didn't understand the risks. Know how long you'll stay. This is really important because the cost of buying and selling a home is expensive and very time-consuming. If you're not planning on staying in your home more than seven to ten years, think about renting. You may still decide to buy, but you need to understand the cost of purchasing and maintaining a home. Investigate the economic difference between buying and renting. Be realistic about how frequently you've moved in the past and whether you're now ready to settle in for several years. You can always rent your home out but this assumes that you'll be a landlord (willing to take on all those duties) and then also have to find another place to live and either rent or buy. After considering all of these factors and making certain that you're ready to buy, then take the next step and find the best agent in your real estate market. Your agent will help you further prepare to buy the home of your dreams.

Written by Phoebe Chongchua

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

How Home Buyers Use Technology

When searching for a real estate agent, make sure he or she is tech savvy. You are. The point person in your quest for your dream home should be packing the latest technology too. Check the stats compiled by MountainSeed Appraisal Management in Atlanta, GA.

A vast majority, 90 percent of home buyers use the internet to kick off their search for housing.

Home buyers today are mobile. They aren’t just sitting at a desk, online looking for a home. Mobile applications are also a weapon of choice.

Nearly 30 percent are smart phone home shopping while waiting in line; 27 percent are searching over dinner and 26 percent are guests at someone’s home and likely just bored stiff.

On average a person conducts 11 digital searches before making another move, like calling in an agent, attending an open house or otherwise 3-Ding their search.

Agents in certain states have a greater need to get with the digital thing. The states with the highest number of online queries for first time home buyers are Delaware (The First State is first); Louisiana (it can get pretty muggy traipsing around); Mississippi (ditto); South Dakota (there’s just too much to walk around); and Wyoming (ditto). "I think it is important to note that not only are home buyers using technology more than ever, but also home owners. When possible, many are looking at refi rates, paying their mortgage payment by smart phone, or simply perusing their mortgage statement," said David Craig, vice president of sales at CEDAR Document Technologies an Atlanta, GA-based communications technology company. Craig added, "it is also important to note that ‘mobile’ doesn’t necessarily mean a borrower is on the move. Many people today opt for their (smart) phone while sitting at home before ever opening a laptop or using a desktop computer.”

Written by Mark K. Hicks

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

The Scoop on Closing Costs

Are you a buyer preparing to close on a house? Now is a good time to refresh yourself on the most common closing costs. There are more expenses to buying a house than just the monthly mortgage payment. More than likely you'll need to come up with some cold, hard cash in order to finalize the deal. Here are some common closing costs to consider:

Down Payment: Due to today's economic climate, most buyers will need to put down at least 20 percent. This makes good financial sense. If you can't afford to put 20 percent down then you probably can't afford to buy this particular house.

Loan Origination: This is what the lender charges you to underwrite the loan, meaning what they charge for their time and all the paperwork they need to do.

Points: You'll often see that different lenders have different "rates" and different "points" they charge. By paying points, you can receive a lower interest rate, but this means more cash at closing.

Credit Score: You can access your credit report for free at annualcreditreport.com, however, in order to see your credit "score" -- the magic number that lenders use to determine your interest rate -- you'll need to pay a small fee.

Home Inspection: You want to be sure, no matter if the house is new or old, that you get a home inspection by a qualified inspector. You may love the house and the price, but if you find out that a big ticket item needs replaced you will be able to renegotiate the price or decide to change your tune on buying the home. A typical inspection will run you from around $300 to $500.

Private Mortgage Insurance (PMI): This is what a lender charges if you are putting less than 20 percent down on the cost of the home. It usually runs about .5 to 1 percent of the total cost of the loan and is simply a safeguard to protect the lender should you default.

Other Small Fees: Insurance escrow, property tax escrow, notary feeds, land surveys, deed recording, etc. Be sure to ask your real estate agent which will apply to your contract and what the expected costs will be. Congratulations on the decision to buy! Owning a home can be a wonderfully fulfilling experience. Just be sure you're ready for the closing costs coming your way!
 

Written by Carla Hill Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Buying a Condo

Buying and living in a condominium community has both benefits and drawbacks. This is why purchasing a unit in the right community for you is so important. Condo communities can be as different as night and day. Some have strict rules, while others are lax in their enforcement. Additionally, there are always variances in the costs associated with certain communities. Some have large monthly HOA fees. Others are minimal. What sort of questions should you be asking your real estate agent and the local condo board? Let's find out. First, you should find out about the financial health of the community. You'll want to see if there are adequate funds in reserve. A reserve fund is held for large future repairs, such as replacing roofs, drives, sidewalks, and pools. The condo board must be charging an adequate amount every month to keep this reserve fund in pace with inflation. If a board hasn't been doing their due diligence, you may be slapped with a big bill when a future repair needs to be made. This could range from the a few hundred to thousands of dollars. Does this community allow you to rent out your unit? Sometime down the road you may find yourself wanting to move or rent out your unit, even to family. Many communities are very renter friendly and this will be no problem. Others strictly prohibit non-owner occupied units. You'll also want to ask what the percentage of tenant-occupied units is. Is this a mostly rental-based community? This can bring with it the usual complaints of rentals. There may be less upkeep, more noise, and less of a sense of permanent community. Along this same line of thought you should ask what the turnover rate is. Are residents settling in for years (an indication they like it there) or is this a community that sees people come and go? Is the condo board involved in any sort of litigation at the moment, meaning are they being sued by a former resident? Conversely, is there any litigation they are pursuing against any current or past residents? These kinds of questions can give you a real feel for the tone of the community. Finally, be sure to ask about the bylaws and restrictions of the property. You may have your heart set on having a garden or doing your own landscaping. The condo board may have other ideas. What if you want to make certain upgrades or improvements to your unit? Is this allowed? Be sure to ask for a copy of these bylaws and then have a professional look them over. Living in a condo can be a wonderful experience. They can be tidy and low maintenance as well as a great social hub. Just be sure to do a little research when you're in the market to buy so you can be sure to purchase in the perfect community for you.

Written by Carla Hill

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Basic Tips for First-time Buyers

It's a scary step going from renter to first-time homeowner. Where does one start on the search for the perfect home? How much home can you really afford? Are you ready to sign on that dotted line? Homeownership is a good long-term investment. The keyword, though, is long-term. There are many extra costs associated with owning a home, including such things as repairs, maintenance, insurance, and cosmetic upgrades. Additionally, homes across the nation are still experiencing declines in value. This means you'll need to stay in a home longer before you'll build equity, likely in excess of five years. The most logical place to start then is with how much you can really afford.

1. What can you afford? This is a tricky question. Of course, there is the number your lender gives you. "You qualify for X amount." It's up to you, however, to decide if that amount is reasonable for your lifestyle. Just because you qualify for X amount doesn't mean you should buy a home priced at that. You may find a cheaper home services all of your needs, while leaving you plenty of extra monthly cash for traveling, entertainment, and other of life's pleasures.
   
2. Long-term use: Think long-term in terms of the size of the home and its location. You may be a single person or a young couple now, but kids can be a game changer. A once perfectly sized home can seem cramped. With homeowners needing to stay put longer in order not to sell at a loss, it's even more important for first-time buyers to think long-term.
   
3. Fixer or move-in ready? Some buyers love to buy a fixer-upper home in a prestigious neighborhood. It's a foot in the door, literally. With a few upgrades and cosmetic fixes you can bring an outdated home into the new decade. Other buyers abhor projects. They want a home that needs nothing. They love the kitchen, baths, and even paint colors. Which type of buyer are you?
   
4. Attached or Detached living? A condo can be maintenance free, but it will also come with HOA fees. A townhouse may give you more outdoor space, but you'll still be sharing walls with a neighbor. Are you wanting lots of privacy? Are you looking forward to the autonomy that a detached home affords you? Be sure to discuss all of your options with your real estate agent.
   
5. Hiring an agent: If you are like most first-time buyers you'll start your search online. That's a great place to start, but to traverse the roads of real estate competently and safety, you should enlist the help of a real estate agent. They will not only show you the newest listings and the best fitting homes, but will also guide you through all the carefully worded contracts coming your way.
   
6. Be ready to pull the trigger: While it is currently a buyers market in most areas of the nation, you still need to be ready to buy when a good deal presents itself. Some first-time buyers can become trigger shy when the time finally comes to make an offer. It's no wonder. Seeing your name next to all those zeros can be quite a pill to swallow. So, mentally prepare ahead of time for the act of signing on the dotted line.
   
7. Lender Pre-qualification: Sellers want pre-qualified buyers viewing their homes. This shows that you are serious about buying. It will also show you how much you can spend and even if you can qualify for a mortgage. Lending is tight and if you have blighted credit you may have a hard time procuring a loan.
   
8. Downpayment: How much of a downpayment do you have saved? Are there family members who might be willing to help out? Most lenders are now requiring 20 percent down on any home purchase. This means for a $100,000 home you'll need $20,000 in cash to put down.
   
9. Resale: If you are planning on staying put for the long haul, resale might not be a real concern, but if this is going to be a starter house, you should be sure to consider how easy a home will be to resell later down the road.
   
10. Finally, be sure to consider the "what ifs" of life. What if you or your spouse lose your job? Will you still be able to afford your mortgage payments? What if you become ill? Will you still want to climb those three flights of stairs? What if you have children? Will you quickly outgrow your home? All of these scenarios should be given careful consideration.

Homeownership can be a genuine joy. It can bring stability and a sense of pride to any household. Take the time to think over these ten tips and you'll be sure to make a great decision for your first purchase!

Written by Carla Hill

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Move Up or Stay Put?

Between price reductions and record low interest rates, many homeowners are asking themselves if now is a good time to move up. Buying under today's conditions can mean getting more home for less buck. You'll pay a smaller amount of interest over time and can snag that dream home for a fraction of it's boom era price. Additionally, with the large number of distressed homes on the market, you may even find a home at a steep 10 to 20 percent discount. Before you start mentally decorating that dream home, however, you should consider what “moving up” means for you. For some buyers, moving up means a better neighborhood. For others it means a bigger home with more space or amenities. Here are five questions every buyer should consider before making the move. First, where do you stand on equity? In simple terms, equity is the difference between what you owe and what your home is worth. You might already know this amount, but if you don't, you can always call your lender to get more details. Despite recent declines in home prices -- and some areas have had steeper declines than others -- if you've lived in your home for over five years you may have built a substantial amount of equity. Equity gives you some wiggle room during the selling process. You can rest a bit easier that you will sell for a profit instead of a loss. Second, what is the state of your financial situation? Some jobs are more stable than others. You do not want to take on a new financial burden if you fear that there may be downsizing at your company. Are you a two income household? What would happen if one of you were to lose your job? Can you really afford to move up? This means having at least 20 percent to put down, being able to pay off your current mortgage, and not having to lay a finger on your retirement funds to make the new purchase. Third, are you willing to move during a market that is still seeing home price declines. Yes, you might be able to get into your dream home, but will be you also might see your new home's value decline in the months and years to come. Fourth, what is pricing like for your current neighborhood? You may wish to get a comprehensive market analysis to find out the current value of your home as well as the specifics on your neighborhood competition. Finally, what is your real reason for wanting to move? Are you an empty nester wanting to simplify life by downsizing to a smaller home, condo, or townhome? Are multiple generations living under the same roof? Are you wanting to move to a newer neighborhood? Consider what it is that you really want. Does moving up make sense for you at this moment in time? While there are some great deals to be had, it has to make good financial sense right now.

Written by Carla Hill

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Vacation Home Market

Are you in the market to buy a vacation home? If so, you're not alone. There is a ripe and ready segment of today's market that is geared up for taking advantage of today's favorable buying conditions. According to the latest National Association of Realtors Investment and Vacation Home Buyers Survey, vacation-home sales rose 7.0 percent in 2011. Investment property purchases were up a staggering 64.5 percent. Many of these were distressed properties being sold at steep discounts. In comparison to the total sales, vacation-homes were 11 percent of all transactions for 2011, up a healthy 10 percent in 2010. NAR Chief Economist Lawrence Yun said investors with cash took advantage of market conditions in 2011. "During the past year investors have been swooping into the market to take advantage of bargain home prices," he said. "Rising rental income easily beat cash sitting in banks as an added inducement. In addition, 41 percent of investment buyers purchased more than one property." These investment buyers are pulling out the cash as they look into buying these rental properties. Forty-nine percent of investment buyers paid cash in 2011. Forty-two percent of vacation-home buyers did the same. "Clearly we're looking at investors with financial resources who see real estate as a good investment and who aren't hesitant to use cash," Yun said. "Of buyers who financed their purchase with a mortgage, large downpayments were typical. The median downpayment for both investment- and vacation-home buyers in 2011 was 27 percent." What types of buyers are scooping up today's vacation homes? The NAR survey said lifestyle factors are the leading motivator. These homes are more likely found in suburban and rural areas. The median vacation-home price was down 19.1 percent from 2010 to $121,300. The NAR reports, "The typical vacation-home buyer was 50 years old, had a median household income of $88,600 and purchased a property that was a median distance of 305 miles from the primary residence; 35 percent of vacation homes were within 100 miles and 37 percent were more than 500 miles. Buyers plan to own their recreational property for a median of 10 years." Additionally, 16 percent of vacation buyers bought the property for a family member (such as a child going attending school), friend, or relative to use. Regionally, 42 percent of vacation home were purchased in the South, 30 percent in the West, 15 percent in the Northeast, and 12 percent in the Midwest.

Written by Carla Hill

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com

Five Pitfalls That Keep Buyers From Finding The Right Home

Buying a home is like searching for a mate. You'll go on many first dates and in the end, the one that has most but maybe not all of the characteristics that you want, will win your heart.
However, first-time buyers and sometimes even serial homebuyers are disappointed by how long the process takes. Yet they may not understand how their expectations, beliefs, and lack of action may be causing the delay in finding the right home. Here are five pitfalls that buyers can fall into that cause them to let the right home slip by.

Seeing a home "as-is". I don't mean that buyers should not view homes on the market that are listed for sale "as-is"; rather I mean not being able to see beyond the "as-is" home. In other words, some buyers walk into a home and are immediately turned off by something as simple as the color of paint which can be easily changed, or maybe it's the carpet or wallpaper. Regardless, when buyers see the home "as-is" without the ability to envision it differently, they do themselves a huge disservice and fall into a pitfall of thinking that the home is not right simply because of the condition they are currently seeing it in.

Not working with an expert agent. Buyers can weed through the paper and click around the Web looking for open houses and listings but a quality agent can help identify the best-suited properties much faster. An expert agent also often knows about other listings that are about to come on the market and would not be in the paper or on the Web yet. It's worth it to spend time interviewing agents to find the right one who can help you find the right home. If you fall into the pitfall of trying to do everything on your own, you're likely going to miss seeing some of the houses that might offer the best match for your wants and needs.

Letting the important things slide. We've all done this when making an expensive purchase. We compromise on something that is important simply because it's less expensive. Later we regret it. Whether it's a new car, new house, or flat screen TV, when you're making large purchases, you need to know which things are important and non-negotiable and then stick to that list. Of course, there may be some small, less important things that you'll compromise on, but if you compromise on something big that is important to you, you're likely going to be disappointed down the road. There is a reason you were searching for a three-bedroom home. So, for instance, when you fall in love with that quaint, cozy two-bedroom home, remember that you had specific reasons for needing an additional bedroom. If you've clearly defined your living needs and wants before you begin house hunting, you'll have guidelines to keep you on track. You might find that the smaller home has a secondary unit on the property and, while it's not a third bedroom, it will suit your needs. So, yes, be flexible and think of the possibilities, but do remember your list of what you originally deemed important. The tendency is to get caught up in the moment, either because a home is so charming or because it appears to be such a good deal that you start to say, "Well, I can make-do without that." Maybe you can...but you'd better be certain before you close escrow.

Living strictly in the moment. Most of the time I write about practicing living in the moment because so many of us lead hectic lives. But when you're buying a home, you'd better be thinking about the future. What's good for you today will likely need to be good for you for many years to come. So, do your homework to find the right home. Work with your agent to find out how the neighborhood is changing. What future plans are there for the community? Pay attention to the congestion of an area and to the types of retail shops and restaurants that are coming into the community...then compare that to your future plans. You can't always know what lies ahead but many times you can see what types of projects have been proposed for undeveloped land in the area.

Skipping an inspection. I've written a lot about this one. Inspections are critical. They're the equivalent of taking a car you want to buy to your car repair shop for a look before you buy. Just like you don't want to end up with a lemon for a car, you don't want a home that has too many and too costly repairs needed. Inspections give you a "health" check of the home. They let you know what you're in for should you buy the home. You'll be glad you have a report to help validate your reasons for wanting to purchase this home over others.

Avoiding these pitfalls will help you more quickly find the right home and the right investment for your future.

Written by Phoebe Chongchua

Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com