Many people ask us whether they should hire an agent to sell or to buy their home or whether they should first try as a For Sale by Owner (FSBO). In today’s market, we believe this is an easy decision: you need an experienced professional!
You need an expert guide if you are traveling a dangerous path
The field of real estate is loaded with land mines. You need a true expert to guide you through the dangerous pitfalls that currently exist. Finding a buyer ready, willing and able to pay fair market value for your home at a time when lending standards are so stringent is not an easy task. Finding reasonable financing can also be tricky when interest rates are volatile like they have been over the last several months.
You need a skilled negotiator
In today’s market, hiring a talented negotiator could save you thousands, perhaps tens of thousands of dollars. Each step of the way – from the original offer, to the possible re-negotiation of that offer after a home inspection, to the possible cancellation of the deal based on a troubled appraisal – you need someone who can keep the deal together until it closes.
Realize that when an agent is negotiating their commission with you, they are negotiating their own salary; the salary that keeps a roof over their family’s head; the salary that puts food on their family’s table. If they are quick to take less when negotiating for themselves and their families, what makes you think they will not act the same way when negotiating for you and your family? If they were Clark Kent when negotiating with you, they will not turn into Superman when negotiating with the buyer or seller in your deal.
Bottom Line
We believe that famous sayings become famous because they are true. You get what you pay for. Just like a good accountant or a good attorney, a good agent will save you money…not cost you money.
Written by KCM Blog
Wednesday, October 9, 2013
Monday, October 7, 2013
Advantages to Buying a Home With Cash
Buying a home with cash has definite advantages in today’s market. National Association of Realtors® research on cash sales shows that about 30 percent of residential sales are cash transactions. Among investors and international buyers, more than 70 percent of properties are bought outright. If you can afford to buy up front, the advantages are many:
Sellers prefer cash buyers
Home sellers generally prefer quick, smooth sales. They know that even buyers who have been preapproved for mortgages might be denied by the lender later on. For example, a buyer who is an independent contractor might have difficulty proving two years of regular employment, or a buyer depending on a family member for a personal loan might later opt out (or the relative might). Therefore, when possible, sellers prefer to steer clear of buyers who have to apply for a mortgage. If you are buying with all cash, you have greater negotiating power on price, closing time, repairs, and more. Sellers are often willing to reduce the house’s price for cash buyers.
Cash purchases avoid the risk of low appraisals
Home appraisals are notoriously fickle. Lenders determine a home’s worth by weighing it against comparable sales — other homes in the neighborhood that may have sold at low prices for unknown reasons. A low appraisal could lead the lender to reduce the amount of the loan offer, even after seller and buyer have agreed on a price. If the loan amount comes up short, the buyer often cannot afford to buy the home. All-cash buyers sidestep mortgage applications, avoiding the need for a potentially deal-breaking home appraisal.
Cash purchases save money and time
Indisputably, cash purchases carry lower costs. Mortgage interest on a 30-year loan can double or triple the original purchase price. Additionally, closing costs are significantly lower when purchases are made with cash. Cash purchases also save buyers valuable time, eliminating the need to gather elusive documents and search for the optimal lender.
Peace of mind is priceless
Most importantly, all-cash purchases bring an inviolable sense of security. Owning your home outright means never having to worry about covering your mortgage. In the face of disaster, such as job loss or injury, full ownership eliminates the risk of losing your home to foreclosure. Moreover, if you have paid cash, you will have excellent equity in the house. In case of financial emergency, you can draw on that equity for quick cash.
Figure out how to pay in cash
Buying your house with cash might seem like an impossible dream. Here are some tips to help you achieve it:
Written by Gilan Gertz
- Sellers are likely to favor buyers who can pay in cash.
- The home price may be reduced for those who pay in full up front.
- All-cash purchases streamline the home-buying process: No loans means less paperwork and no delays for mortgage approval.
- Cash buyers can save money on closing costs, bank appraisals, mortgage applications and fees, title insurance, and so on.
- Cash purchases eliminate the risk of loan denial.
- Cash buyers pay much less for their homes in the long run: No loans means no interest.
- Cash buyers never have to worry about losing their homes because they can’t afford to repay their mortgage loans.
- Cash buyers gain full, immediate equity in their home.
Sellers prefer cash buyers
Home sellers generally prefer quick, smooth sales. They know that even buyers who have been preapproved for mortgages might be denied by the lender later on. For example, a buyer who is an independent contractor might have difficulty proving two years of regular employment, or a buyer depending on a family member for a personal loan might later opt out (or the relative might). Therefore, when possible, sellers prefer to steer clear of buyers who have to apply for a mortgage. If you are buying with all cash, you have greater negotiating power on price, closing time, repairs, and more. Sellers are often willing to reduce the house’s price for cash buyers.
Cash purchases avoid the risk of low appraisals
Home appraisals are notoriously fickle. Lenders determine a home’s worth by weighing it against comparable sales — other homes in the neighborhood that may have sold at low prices for unknown reasons. A low appraisal could lead the lender to reduce the amount of the loan offer, even after seller and buyer have agreed on a price. If the loan amount comes up short, the buyer often cannot afford to buy the home. All-cash buyers sidestep mortgage applications, avoiding the need for a potentially deal-breaking home appraisal.
Cash purchases save money and time
Indisputably, cash purchases carry lower costs. Mortgage interest on a 30-year loan can double or triple the original purchase price. Additionally, closing costs are significantly lower when purchases are made with cash. Cash purchases also save buyers valuable time, eliminating the need to gather elusive documents and search for the optimal lender.
Peace of mind is priceless
Most importantly, all-cash purchases bring an inviolable sense of security. Owning your home outright means never having to worry about covering your mortgage. In the face of disaster, such as job loss or injury, full ownership eliminates the risk of losing your home to foreclosure. Moreover, if you have paid cash, you will have excellent equity in the house. In case of financial emergency, you can draw on that equity for quick cash.
Figure out how to pay in cash
Buying your house with cash might seem like an impossible dream. Here are some tips to help you achieve it:
- Set aside unexpected windfalls, such as work bonuses or inheritances.
- Lock money in a long-term CD to earn interest.
- Once you have accrued cash, look for a house you can afford without borrowing extra money.
- Consider moving to a less populated area, further from a big city, where home prices are likely to be lower.
- Avoid the temptation to waste money. Tell your friends and family about your goal of buying a home; they will help keep your spending on track.
Written by Gilan Gertz
Friday, October 4, 2013
Tips for Buying a Home in the Fall
So, you’re finally off the fence and ready to buy a home before prices — and mortgage rates — rise any further. Here’s what you need to know about jumping into the market at this time of year.
Know your market
The bottom line is that different markets behave differently during the fall. According to Zillow’s August Real Estate Market Reports, national home values rose 0.4 percent from July, marking the third consecutive month in which monthly home values rose more slowly than the month prior. However, markets in California, Las Vegas and Minneapolis are still seeing an extremely brisk pace of home value appreciation (2 percent or higher). As we exit this year’s selling season, we will start to see a slowdown in home value appreciation.
Selection is limited
Many frustrated sellers who weren’t able to unload their properties during the busy peak spring/summer buying season may take their homes off the market, particularly as the holidays approach and the action comes to a screeching halt. This means you can expect the selection to be even more limited than it currently is in some markets.
There’s room to negotiate
Was there a home you saw and loved a few months ago? Is it still on the market? If it hasn’t sold after one of the hottest real estate summers since the economic downturn, you likely have room to negotiate. While some buyers will pull their homes off the market, others who have been holding out for the best possible price may now be ready to come down. While some homeowners are determined to get a set price, others may simply want out at this juncture.
Check maintenance areas
Fall is the ideal time to check things such as gutter drainage and the general upkeep of the yard. How does everything look? Does anything need repair? Visit the home on a rainy day and see for yourself. Then go inside and check out the furnace, looking for drafts, leakage issues and other possible structural/maintenance problems. If they’re apparent, determine how much money it’s going to take to get everything up to snuff and factor that into your offer, adjusting your price accordingly.
Written by Vera Gibbons
Know your market
The bottom line is that different markets behave differently during the fall. According to Zillow’s August Real Estate Market Reports, national home values rose 0.4 percent from July, marking the third consecutive month in which monthly home values rose more slowly than the month prior. However, markets in California, Las Vegas and Minneapolis are still seeing an extremely brisk pace of home value appreciation (2 percent or higher). As we exit this year’s selling season, we will start to see a slowdown in home value appreciation.
Selection is limited
Many frustrated sellers who weren’t able to unload their properties during the busy peak spring/summer buying season may take their homes off the market, particularly as the holidays approach and the action comes to a screeching halt. This means you can expect the selection to be even more limited than it currently is in some markets.
There’s room to negotiate
Was there a home you saw and loved a few months ago? Is it still on the market? If it hasn’t sold after one of the hottest real estate summers since the economic downturn, you likely have room to negotiate. While some buyers will pull their homes off the market, others who have been holding out for the best possible price may now be ready to come down. While some homeowners are determined to get a set price, others may simply want out at this juncture.
Check maintenance areas
Fall is the ideal time to check things such as gutter drainage and the general upkeep of the yard. How does everything look? Does anything need repair? Visit the home on a rainy day and see for yourself. Then go inside and check out the furnace, looking for drafts, leakage issues and other possible structural/maintenance problems. If they’re apparent, determine how much money it’s going to take to get everything up to snuff and factor that into your offer, adjusting your price accordingly.
Written by Vera Gibbons
Wednesday, October 2, 2013
Should You Buy a Condo? A Breakdown to Help You Decide
Is a condo a good home purchase? That, say most real estate agents, depends on your lifestyle and wish list.
From cost to negotiating with neighbors, here are a few factors to keep in mind when considering whether to purchase a condo.
Condo advantages
As the housing market rebounds, condos are a strong purchase choice, says real estate agent Monte Levin of Coldwell Banker Previews International, especially in the Boston real estate market, where he works.
“The real estate markets in the central neighborhoods of Boston were not as badly affected by the recession as many other areas of the country,” Levin said. “That being said, we have been experiencing very strong demand and low supply, and prices have been moving up steadily.”
Many of the homes in those central Boston neighborhoods — Back Bay, Beacon Hill and South End — are condos. It’s in these largely urban areas of big metros that the resale value of condos is strong, Levin says.
“Empty nesters who are leaving the suburbs for the city to enjoy all that the city has to offer,” are a significant factor, Levin said. “These buyers are usually scaling down from large suburban homes and are trading size for the convenience of a condominium in the city.”
It’s this convenience, says Madison Hildebrand of Coldwell Banker Previews International in Malibu, that appeals to buyers.
“Condos give an opportunity to those looking for a second home or vacation home who are not interested in the maintenance of a single-family home,” said Hildebrand, star of Bravo TV’s “Million Dollar Listing.”
“Areas like Marina del Rey, a beach community but located conveniently to the city, are perfect getaways for those traveling from other states or even from abroad.”
More than anything, however, condos also are appealing for their low cost. Even with homeowners association (HOA) fees, a condo can be a great investment for first-time home buyers, both agents agreed.
“Condos can be a great stepping stone for first-time buyers,” Hildebrand said. ”Expenses are shared between condo owners for maintenance of the property.”
Condo disadvantages
If there’s anything that concerns potential homeowners most, it’s the possibility of HOA fees, which vary greatly from building to building, says Hildebrand.
“When purchasing a condo, one must consider the taxes, insurance, mortgage and HOA fees, making sure it fits in their monthly budget,” he said.
The fees are typically non-negotiable and can change at any time, but with these fees comes the convenience of living in a low-maintenance property.
Shared walls and having to deal more closely with neighbors are also drawbacks for some buyers.
“If you like to be in greater control of your ‘destiny’ and don’t want the physical proximity of other people, condo living probably isn’t [for you],” Levin said. “In condo living, one has to negotiate with other condo owners in their association on improvements, added services and condo owner rules.”
Condo or single-family?
Ultimately, says Levin, it’s more about the location and the design of the home than whether it’s a single-family dwelling or condo.
“If you buy well to suit your lifestyle, you should benefit from a sound investment, be it condo or single-family,” he said.
Written by Erika Riggs
From cost to negotiating with neighbors, here are a few factors to keep in mind when considering whether to purchase a condo.
Condo advantages
As the housing market rebounds, condos are a strong purchase choice, says real estate agent Monte Levin of Coldwell Banker Previews International, especially in the Boston real estate market, where he works.
“The real estate markets in the central neighborhoods of Boston were not as badly affected by the recession as many other areas of the country,” Levin said. “That being said, we have been experiencing very strong demand and low supply, and prices have been moving up steadily.”
Many of the homes in those central Boston neighborhoods — Back Bay, Beacon Hill and South End — are condos. It’s in these largely urban areas of big metros that the resale value of condos is strong, Levin says.
“Empty nesters who are leaving the suburbs for the city to enjoy all that the city has to offer,” are a significant factor, Levin said. “These buyers are usually scaling down from large suburban homes and are trading size for the convenience of a condominium in the city.”
It’s this convenience, says Madison Hildebrand of Coldwell Banker Previews International in Malibu, that appeals to buyers.
“Condos give an opportunity to those looking for a second home or vacation home who are not interested in the maintenance of a single-family home,” said Hildebrand, star of Bravo TV’s “Million Dollar Listing.”
“Areas like Marina del Rey, a beach community but located conveniently to the city, are perfect getaways for those traveling from other states or even from abroad.”
More than anything, however, condos also are appealing for their low cost. Even with homeowners association (HOA) fees, a condo can be a great investment for first-time home buyers, both agents agreed.
“Condos can be a great stepping stone for first-time buyers,” Hildebrand said. ”Expenses are shared between condo owners for maintenance of the property.”
Condo disadvantages
If there’s anything that concerns potential homeowners most, it’s the possibility of HOA fees, which vary greatly from building to building, says Hildebrand.
“When purchasing a condo, one must consider the taxes, insurance, mortgage and HOA fees, making sure it fits in their monthly budget,” he said.
The fees are typically non-negotiable and can change at any time, but with these fees comes the convenience of living in a low-maintenance property.
Shared walls and having to deal more closely with neighbors are also drawbacks for some buyers.
“If you like to be in greater control of your ‘destiny’ and don’t want the physical proximity of other people, condo living probably isn’t [for you],” Levin said. “In condo living, one has to negotiate with other condo owners in their association on improvements, added services and condo owner rules.”
Condo or single-family?
Ultimately, says Levin, it’s more about the location and the design of the home than whether it’s a single-family dwelling or condo.
“If you buy well to suit your lifestyle, you should benefit from a sound investment, be it condo or single-family,” he said.
Written by Erika Riggs
Monday, September 30, 2013
Finding and Using Your Own Realtor
Actually, the best thing for you to do when you see an advertisement in the paper is to call your own Realtor and tell them about the ad. Since addresses usually do not appear in advertisements, your Realtor will call the listing agent and find out the MLS number for the property. If the listing is on the internet, it probably already provides the MLS number.
The MLS number allows the agent to access the listing directly on the Multiple Listing Service. That reveals a lot more information than what is available to you on the web.
The house may turn out to be a great home for you, but it may also be a property the Realtor has already disregarded because it backed up to a busy noisy street and you have told your Realtor you wanted a quiet neighborhood.
You Have to Find an Agent. How do you do that?
If you're reading this, you're probably on the Internet. One key to a successful relationship between a real estate agent and their client is that, in addition to representing your interests competently, they educate you about the process as it unfolds. So don't simply look for property on the web - look for an agent that informs you about the process.
Referrals are always a good way to go. Perhaps a friend, co-worker, or family member recently bought a house in the same community and had a good experience. However, if they bought a house twenty miles from where you want to move, it may not be a good idea to use the same Realtor.
You want an agent who knows the area in detail and has already previewed many of the homes available for sale in that community. Community knowledge should be important to you because you are not just buying a house. You are buying a home in a local neighborhood in a specific community.
Every Realtor can show you every property available for sale in the Multiple Listing Service. Since that is true, you can call any real estate office and find a Realtor willing to show you houses for sale. The problem is that you do not know if you are talking to an excellent Realtor or a lazy inactive one.
By Unknown
Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com
The MLS number allows the agent to access the listing directly on the Multiple Listing Service. That reveals a lot more information than what is available to you on the web.
The house may turn out to be a great home for you, but it may also be a property the Realtor has already disregarded because it backed up to a busy noisy street and you have told your Realtor you wanted a quiet neighborhood.
You Have to Find an Agent. How do you do that?
If you're reading this, you're probably on the Internet. One key to a successful relationship between a real estate agent and their client is that, in addition to representing your interests competently, they educate you about the process as it unfolds. So don't simply look for property on the web - look for an agent that informs you about the process.
Referrals are always a good way to go. Perhaps a friend, co-worker, or family member recently bought a house in the same community and had a good experience. However, if they bought a house twenty miles from where you want to move, it may not be a good idea to use the same Realtor.
You want an agent who knows the area in detail and has already previewed many of the homes available for sale in that community. Community knowledge should be important to you because you are not just buying a house. You are buying a home in a local neighborhood in a specific community.
Every Realtor can show you every property available for sale in the Multiple Listing Service. Since that is true, you can call any real estate office and find a Realtor willing to show you houses for sale. The problem is that you do not know if you are talking to an excellent Realtor or a lazy inactive one.
By Unknown
Thinking about Buying or Selling?
Call Alvin's Team Today! 877-651-7810
Or visit our website: www.LivingLakeTahoe.com
Monday, September 23, 2013
Buyers in a Hurry to Lock in Rates
As mortgage rates move up, buyers are moving in to secure interest rates before they're priced out of the market. Most lenders offer buyers a loan lock-in period of 30, 45, 60, or 90 days. Lenders then are obligated to offer the home loan at that lock-in rate, even if rates have risen during that time. Some lenders lately have even revived “lock and shop” programs, allowing buyers to lock in an interest rate for an unlimited time before they even find a property to purchase.
Lawrence Yun, chief economist for the National Association of REALTORS®, called August’s surge in home sales likely the “last hurrah” for the next year to 18 months as mortgage rate increases and rising prices likely dampen affordability and sales in the coming months. Sales of previously-owned homes rose in August to the highest level in more than six years.
“Rising mortgage rates hurried some people into making the decision” to close on a deal, Yun says.
Mortgage rates have been on the rise since May when the Fed indicated that it would soon be winding down its $85 billion monthly bond purchases, which had helped keep mortgage rates near all-time lows.
Mortgage rates have moved up more than a full percentage point since May. The Fed announced last week it would delay its taper, which temporarily brought mortgage rates down last week from yearly highs. The 30-year fixed-rate mortgage fell to 4.5 percent last week, according to Freddie Mac.
PulteGroup said it expects the increase in borrowing costs to affect consumer segments differently.
For example, James Zeumer, head of Pulte’s investor relations, says that a half-percentage point rise in interest rates could mean that some first-time buyers “will be out of the game.” Move-up buyers, on the other hand, may “have a little bit more flexibility.”
Written by Realtor Mag
Lawrence Yun, chief economist for the National Association of REALTORS®, called August’s surge in home sales likely the “last hurrah” for the next year to 18 months as mortgage rate increases and rising prices likely dampen affordability and sales in the coming months. Sales of previously-owned homes rose in August to the highest level in more than six years.
“Rising mortgage rates hurried some people into making the decision” to close on a deal, Yun says.
Mortgage rates have been on the rise since May when the Fed indicated that it would soon be winding down its $85 billion monthly bond purchases, which had helped keep mortgage rates near all-time lows.
Mortgage rates have moved up more than a full percentage point since May. The Fed announced last week it would delay its taper, which temporarily brought mortgage rates down last week from yearly highs. The 30-year fixed-rate mortgage fell to 4.5 percent last week, according to Freddie Mac.
PulteGroup said it expects the increase in borrowing costs to affect consumer segments differently.
For example, James Zeumer, head of Pulte’s investor relations, says that a half-percentage point rise in interest rates could mean that some first-time buyers “will be out of the game.” Move-up buyers, on the other hand, may “have a little bit more flexibility.”
Written by Realtor Mag
Wednesday, September 18, 2013
Take the Stress Out of Homebuying
Buying a home should be fun, not stressful. As you look for your dream home, keep in mind these tips for making the process as peaceful as possible.
Written by Realtor Mag
- Find a real estate agent who you connect with. Home buying is not only a big financial commitment, but also an emotional one. It’s critical that the REALTOR® you chose is both highly skilled and a good fit with your personality.
- Remember, there’s no “right” time to buy, just as there’s no perfect time to sell. If you find a home now, don’t try to second-guess interest rates or the housing market by waiting longer — you risk losing out on the home of your dreams. The housing market usually doesn’t change fast enough to make that much difference in price, and a good home won’t stay on the market long.
- Don’t ask for too many opinions. It’s natural to want reassurance for such a big decision, but too many ideas from too many people will make it much harder to make a decision. Focus on the wants and needs of your immediate family — the people who will be living in the home.
- Accept that no house is ever perfect. If it’s in the right location, the yard may be a bit smaller than you had hoped. The kitchen may be perfect, but the roof needs repair. Make a list of your top priorities and focus in on things that are most important to you. Let the minor ones go.
- Don’t try to be a killer negotiator. Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price or by refusing to budge on your offer may cost you the home you love. Negotiation is give and take.
- Remember your home doesn’t exist in a vacuum. Don’t get so caught up in the physical aspects of the house itself — room size, kitchen, etc. — that you forget about important issues as noise level, location to amenities, and other aspects that also have a big impact on your quality of life.
- Plan ahead. Don’t wait until you’ve found a home and made an offer to get approved for a mortgage, investigate home insurance, and consider a schedule for moving. Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to sellers.
- Factor in maintenance and repair costs in your post-home buying budget. Even if you buy a new home, there will be costs. Don’t leave yourself short and let your home deteriorate.
- Accept that a little buyer’s remorse is inevitable and will probably pass. Buying a home, especially for the first time, is a big financial commitment. But it also yields big benefits. Don’t lose sight of why you wanted to buy a home and what made you fall in love with the property you purchased.
- Choose a home first because you love it; then think about appreciation. While U.S. homes have appreciated an average of 5.4 percent annually over from 1998 to 2002, a home’s most important role is to serve as a comfortable, safe place to live.
Written by Realtor Mag
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