AT HOME IN ALASKA

 

Dec. 12, 2017

Before You Make an Offer, Here Are 4 Tips for Success!

So, you’ve been searching for that perfect house to call a ‘home,’ and you finally found it! The price is right, and in such a competitive market, you want to make sure that you make a good offer so that you can guarantee that your dream of making this house yours comes true!

Freddie Mac covered “4 Tips for Making an Offer” in their Executive Perspective. Here are the 4 tips they covered along with some additional information for your consideration:

1. Understand How Much You Can Afford

“While it’s not nearly as fun as house hunting, fully understanding your finances is critical in making an offer.”

This ‘tip’ or ‘step’ should really take place before you start your home search process.

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and will allow you to make your offer with the confidence of knowing that you have already been approved for a mortgage for that amount. You will also need to know if you are prepared to make any repairs that may need to be made to the house (ex: new roof, new furnace).

2. Act Fast

“Even though there are fewer investors, the inventory of homes for sale is also low and competition for housing continues to heat up in many parts of the country.” 

The inventory of homes listed for sale has remained well below the 6-month supply that is needed for a ‘normal’ market. Buyer demand has continued to outpace the supply of homes for sale, causing buyers to compete with each other for their dream homes.

Make sure that as soon as you decide that you want to make an offer, you work with your agent to present it as soon as possible.

3. Make a Solid Offer

Freddie Mac offers this advice to help make your offer the strongest it can be:

“Your strongest offer will be comparable with other sales and listings in the neighborhood. A licensed real estate agent active in the neighborhoods you are considering will be instrumental in helping you put in a solid offer based on their experience and other key considerations such as recent sales of similar homes, the condition of the house and what you can afford.”

Talk with your agent to find out if there are any ways that you can make your offer stand out in this competitive market!

4. Be Prepared to Negotiate

“It’s likely that you’ll get at least one counteroffer from the sellers so be prepared. The two things most likely to be negotiated are the selling price and closing date. Given that, you’ll be glad you did your homework first to understand how much you can afford.

Your agent will also be key in the negotiation process, giving you guidance on the counteroffer and making sure that the agreed-to contract terms are met.”

If your offer is approved, Freddie Mac urges you to “always get an independent home inspection, so you know the true condition of the home.” If the inspector uncovers undisclosed problems or issues, you can discuss any repairs that may need to be made with the seller, or cancel the contract.

Bottom Line 

Whether buying your first home or your fifth, having a local real estate professional who is an expert in their market on your side is your best bet to make sure the process goes smoothly. Let’s talk about how we can make your dreams of homeownership a reality!

Nov. 30, 2017

Renting or Buying…Either Way, You’re Paying Someone’s Mortgage

There are some people who have not purchased homes yet because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich,”

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Nov. 30, 2017

7 Secrets About Short Sales You Need To Know Before Making An Offer

Are you interested in buying a short sale? Even if your aren’t, and you’re in the market to buy a house, you should know about “short sales”. There’s always a chance that a house you fall in love with will be subject to a short sale. So, do you avoid a short sale like the plague? Or do you roll up your sleeves and make an offer?

You Probably Know This, But Just In Case

A short sale is when a homeowner sells their property for less than the amount they owe. Not that the homeowner can just agree to a price and sell you the house for any old amount. They will need approval from their lender. Not too many years ago, short sales weren’t really something you’d see on the market. Then the market tanked, and it became a solution for many people who owed more than they could sell their house for. It was a better alternative than foreclosure, for homeowners and for lenders. At this point, short sales have been around for a quite while. And they keep on showing up. Maybe not as much as they have in recent years, but there doesn’t seem to be an end in sight. Unless the market goes back to the heydays of the early 2000s. Which means you need to at least be aware of them, and know whether or not you want to deal with trying to buy one. So, let’s get into some seven things you should know in case the house you want to buy is a short sale.

1. Not Every Short Sale Is A “Deal”

A lot of buyers say that they want to go after short sales, because they want to get a good deal. Just because a house is being sold “short” (for less than the owner owes), does not mean it’s a good deal. If there are equal options for you to choose from on the market that are not short sales, it may not make any sense at all to go after a short sale. You really should only go after a short sale if you are getting a good deal. Or, if there are no other options, that are as good or even better, for about the same price. It isn’t worth the hassle.

2. Even If It Is A Deal, You’re Going To Pay For It

You’re going to pay for it in patience. Lots and lots of patience. Which boils down to time. And time is money. The time you’re waiting for a short sale to be approved could cost you in many ways. Just to name a few:

  • You might miss other opportunities you would have liked to go after.
  • You might incur costs because you need to line up temporary housing while you’re waiting for the deal to close.
  • You could spend money on due diligence (inspections, mortgage process, etc.) all for nothing, if the sale never goes through.
  • Your mortgage rate could go up during the process of waiting.

Lenders have gotten a bit better and quicker about the process at this point. When this trend first started, they were swamped, and it was all kind of new for everybody. So it took time. Now that the kinks have been worked out, it can happen more quickly. But not necessarily. There is no way to know how long it will take. Err on the side of caution, and plan on it taking anywhere from six months to a year. But it’ll probably be more like between three to six months. Regardless, it will almost always take longer than a straight up sale between you and a homeowner who does not need to sell their house short. So, again, the deal better be worth your time and patience.

3. Expect To Buy It “As-Is”

Almost every seller in the world wants to sell their home “as-is”. Meaning they want to negotiate that the buyer won’t further negotiate any issues that are found in a home inspection during the process. But the reality is, it’s pretty rare for a homeowner to sell their home truly “as-is”. There’s almost always some sort of concession or repair made, once a buyer does their home inspection. No matter how firm the seller wants to be, or how good of a price they gave the buyer, it happens. And sellers will typically agree to some, or even all of the requests made by a buyer. It’s just easier than losing the deal. But it isn’t always just home inspection issues. It could be something related to permits, or certificates the town requires, for instance. In a short sale, the lender isn’t going to step and fix anything, or consider a credit for repairs usually. And they aren’t going to get any permit or certificate issues resolved. It’s hard enough getting them to agree to the lower-than-owed price they accept. So don’t expect it. Don’t even hope for it. And the owner probably isn’t in any financial position to do any repairs, given their situation. And frankly, they probably are pretty much checked out at that point anyway. They want nothing to do with what you want. They get nothing out of it. Unless they are that desperate to just get this chapter of their life over with, and somehow figure out a way to make some repairs. Point is, expect to take on whatever problems the house comes with… Which means, again, it better be a pretty good deal.

4. Don’t Be Surprised If The Lender Counteroffers

Unfortunately, not all real estate agents or homeowners even get the lender on board with the fact that they’re trying to sell the house short. So, you could negotiate what seems to be a great deal with the owner, only to have their lender come back and counter your offer for way more than the house was even listed for. So, let’s say the house is listed for $250,000. You negotiate it down to $225,000. But then the offer is submitted to the lender for approval, and they counter at $325,000...probably because they are owed that much. This strikes a lot of buyers as crazy. How can a lender do that!? The house was listed for less! Well, they weren’t in on the process when the owner and agent made those decisions. Now they are. It might take some time for them to come around. Many buyers get so frustrated that they back out of the deal because of the lender not coming to agreement on the price. Only to see the lender eventually lower their expectations and accept an offer for the price the buyer had offered... or even less! So, it might make sense to just hang in there and wait the bank out. Stand your ground. Be patient. Wait. Or, let another buyer or two loosen the jar lid, and throw offers at the property. Let them get frustrated and get the lender to see the light. Then step in with your offer after one or two other buyers failed to get from offer to a closed deal. But that does take patience. And some amount of strategy. And there is no guarantee…

5. The Deal May Never Be Approved

Whether or not a short sale is approved is out of your control. There are a lot of factors. One of the most frustrating things is that a lot of owners who are trying to sell short do not put in the effort they need to. There’s a lot they need to supply in terms of information. And their motivation is minimal. Beyond that, they are stressed out and probably depressed. So there are times that the homeowner delays the process, if not kills the process altogether. It can get to a point where they progress too far, and fall into foreclosure. And that process can drag on for quite some time. Sometimes, owners feel it would be even better to just get foreclosed. It buys them more time. And a short sale, while better for them than a foreclosure, is no bed of roses. It is still going to negatively affect them. And a lender could simply not agree to a short sale. Maybe the owner is in better financial shape than they feel is necessary to approve a short sale. Or perhaps they just decide it makes more sense to foreclose. It can be frustrating. Your hands are tied. There’s a lot of hurry up and wait. And very little you can do to get anyone to move faster. Even constant follow-up, complaining, or threatening to kill the deal will not make the process move faster. So, just be prepared that you could waste your time, all for nothing. And you will spend money on your end of the process that will never be returned.

6. Be Prepared To Move Fast

When and if a short sale is approved, the chances are that the lender will give you a short time to actually close the deal. So, while they could take months and months just to say yes...they might give you two weeks to close the approved deal. And if you don’t, it could throw the process back into review. The biggest hassle here is with your mortgage (if you are borrowing money to purchase). Your lender needs some time to get your loan approved and “clear to close”. You could be super diligent and get as much of your mortgage process done months ahead of the short sale being approved, but there is still a lot that needs to be done in the final stages. So make sure you’re working closely with your lender, and be good about getting them everything they need ahead of time.

7. Hire A Real Estate Agent Who Is Okay Working With Short Sales

It’s so important to work with a real estate agent who is willing to be in it for the long and hard haul… Not every agent wants to deal with short sales. This is understandable. Agents don’t get paid more for dealing with this type of sale. In fact, they often get paid less. And they are more work. And they are less of a guarantee. And agents work with very little guarantee that their efforts will result in compensation as it is. So, do be aware of this, and thoughtful about it. So, when you hire a buyer’s agent to work with you on a short sale, you need to also be in it with them for the long and hard haul! It is the right thing to do. And it will pay off… Because so many buyers give up on getting a great deal on a short sale because an agent will persuade them to avoid going after one altogether, or encourage a buyer to move on if the process is taking too long. Again, not judging...they have valid reasons for being that way. But it is important for you to know. One thing your buyer’s agent should do before you make an offer on a short sale is to assess whether the listing agent on the property knows what they are doing. Many do not. And in those cases, you might as well not even waste your time. As scary as this all may sound, short sales aren’t something you need to avoid. Just know what you’re getting into beforehand. And be patient. You will pay for the deal in patience, but knowing what you know now, it should be worth every penny of patience you pay.

Nov. 29, 2017

Low Interest Rates Have a High Impact on Your Purchasing Power

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.92%, which is still near record lows in comparison to recent history!

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

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Oct. 5, 2017

You Don’t Want to Hear This from Your Listing Agent

You’ve decided to sell your house. You begin to interview potential real estate agents to help you through the process. You need someone you trust enough to:

  • Set the market value on possibly the largest asset your family owns (your home)
  • Set the time schedule for the successful liquidation of that asset
  • Set the fee for the services required to liquidate that asset

An agent must be concerned first and foremost with you and your family to garner that degree of trust. Make sure this is the case.

Be careful if the agent you are interviewing begins the interview by:

  • Bragging about their success
  • Bragging about their company’s success

An agent’s success and the success of their company can be important considerations when deciding on the right real estate professional to represent you in the sale of your house. However, you first need to know that they care about what you need and what you expect from the sale. If the agent is not interested in first establishing your needs, how successful they may seem is much less important.

Look for someone with the heart of a teacher’ who comes in prepared to explain the current real estate market to you, and is patient enough to take the time to show you how it may impact the sale of your home; not someone only interested in trying to sell you on how great they are.

You have many agents from which to choose. Pick someone who truly cares.

Aug. 22, 2017

One Glaring Real Estate Lesson We Can All Learn From The Solar Eclipse

You've probably heard lots of people scurrying to find solar eclipse glasses. There's going to be quite a few people who simply can't get a pair in time for the eclipse. People waited too long to get them. Perhaps because they weren't entirely in tune with how rare, and how big of an event the eclipse is. But also because they underestimated the supply, availability, and accessibility of the glasses compared to the demand for them. Who'd have thought they'd be about as rare as the eclipse itself?

Don't wait 'til it's too late

This is similar to something seen in real estate... When people hear there's a great house on the market, they often wait to go see it or make an offer...until it's too late to do anything about it. By the time they motivate, the house has been scooped up by another buyer, and often there were even more buyers who were trying to buy it, but lost out.

Houses aren't "a dime a dozen"

The solar eclipse glasses were practically "a dime a dozen". They were all basically the same, inexpensive, and plenty to go around...yet still not enough for everyone who wanted a pair. Houses, on the other hand, are often one-of-a-kind... ...which makes it all the more likely that if you hesitate even the slightest bit, you're going to miss your opportunity.

But there's always another...

Lots of people won't be able to look directly at the eclipse, since they don't have the glasses. They're going to miss the rare opportunity. There will be disappointment. But even though they're rare, another one will occur fairly soon in the U.S in about 7 years. Or, you can see one in a mere 2 years in other parts of the world. They're still rare, no matter how you cut it. But you can see an eclipse at other times if you're willing to travel. Same thing goes for houses... If you lose out on a house because you hesitated, it's disappointing, but it's not the only opportunity you'll have. In fact, you could probably find a similar house to the one you like pretty soon after losing the one you had your eye on...if you're willing to travel. But most people want to find the house of their dreams where they live, not somewhere else. So don't miss your opportunity when you see the perfect house, in the perfect location. Jump on it. Otherwise, you may be waiting a while for the next one to appear.

Aug. 21, 2017

Preparing to be a Home Buyer

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Copyright 2017 NATIONAL ASSOCIATION OF REALTORS®

June 30, 2017

Here’s What Real Estate And Independence Day Have In Common



What's the first thing you think of when you think 4th of July?

Probably fireworks, right?

Okay, maybe you think about barbecues, pool parties, or parades first.

The point is, the first thought for most people isn't about the nitty-gritty that we're actually celebrating — our independence as a nation.

Deep down, we all know that's what it's all about. And we respect it. But, we're also human. Who can blame us for enjoying our freedom watching fireworks, without giving all that much thought about everything our founding fathers did to get us here?

So it is in real estate...

There's a lot of focus on the "fireworks" in real estate. The big, glorious, flashy, exciting moments. Like...

  • The moment your house first hits the market.
  • Seeing the pictures of your house all over the Internet.
  • Throngs of people walking through your first open house.
  • Receiving offers from buyers...maybe even multiple offers.
  • Going under contract.
  • Walking into "the" house, and falling in love with it.
  • Making an offer on the house you love, and having it accepted.
  • Closing on the sale or purchase of your home.

All really exciting "firework" moments.

But they're not the full story. There's a lot of stuff behind the scenes in order to get to those fun, celebratory moments. A lot of thought, knowledge, skill, and work... Not necessarily fun, or sexy stuff. But it's all important. It's all necessary to get to those exciting "fireworks" moments.

Not that the behind the scenes stuff should be something you think about. As a consumer, you should enjoy the glorious moments. Leave the nitty-gritty to your agent.

Just know that there's more to it than the "fireworks" you want to see when you buy or sell a house.

June 28, 2017

10 Things You Should Never Say to a Real Estate Agent

 

 

Let’s be clear on one thing: by nature, real estate agents are not fragile beings. We've heard it all. And for the most part, we have a great sense of humor about things. In other words, you can tell us virtually anything — in fact, you should if it’s pertinent to buying or selling your home. It’s just that there’s a handful of things clients say that can rub us the wrong way. These things aren’t offensive, per se’, and you probably mean no harm when saying them. But we need to discuss these things. Thus, this list. Let’s file it under “edutainment” — important enough to warrant a dialogue, but light enough for you to realize it’s not the end of the world if you’ve said these things to an agent in the past. Here they are.

1. “I want to buy a home, but I don't want to commit to one agent.”

Loyalty is a two-way street. If you want an agent's help, understand that he or she will spend a considerable amount of time, money, and effort shuttling you from house to house, scheduling home viewings, and previewing listings on your behalf. The tradeoff for this hard work is to sign a buyer's agency agreement, allowing them to formally represent you as a client (versus merely a customer). There are major differences between the two. Learn more about agency relationships here.

2. “Don't show my home unless I'm available.”

Look down. See a hole in your shoe? That’s because you’re shooting yourself in the foot. Real estate agents are busy. Therefore, if you want to maximize your home’s exposure, you’re gonna have to be flexible (i.e., as "hands off" as possible). I get it, though. You cringe at the thought of muddy shoes dragging across your beige carpet (or whatever else your concern may be). You naturally want to be present to keep an eye on things, but try to control that urge. Buyers get uncomfortable with sellers standing over them while they view a home -- and that’s if you’re lucky enough to draw the buyer inside in the first place, considering all the hoops created by stipulating that other people’s schedules must align with yours.

3. “But Zillow said…”

Stop listening to Zillow. Relying on Zillow to determine your home’s value is, at best, a crapshoot. Zillow itself even encourages buyers, sellers and homeowners to conduct other research such as “getting a comparative market analysis (CMA) from a real estate agent” and “getting an appraisal from a professional appraiser.” Sure, Zillow’s Zestimates® are quick, easy, and free… but so is dating advice from your thrice-divorced Uncle Larry. The point? Just let a local real estate professional (who will actually see your home’s unique features in person) determine its fair market value.

4. “I'll get pre-approved for a mortgage later.”

This puts you at a huge disadvantage right out of the starting block. First, an agent worth his or her salt won’t agree to invest countless hours showing homes to someone who isn’t approved for a loan. Secondly, it’s an unfair burden on the seller to bring tire-kickers into their home (which is how you’ll be perceived). Therefore, listing agents and sellers will often require a pre-approval letter alongside your offer. This letter strengthens your offer by instilling confidence in all parties that you’re financially capable of purchasing the home.

5. "I don't want to bother my Realtor®. Can you just show me the house?"

Not just no, but heck no. To be clear, you’re more than welcome to view it, but there’s a protocol in play here. Contrary to what you think, asking your agent to see a home is not “bothering” them. It’s their job. It’s how they get paid. It’s what they love doing. If there are extenuating circumstances preventing your agent from showing you a home, let him or her call the listing agent directly. Don’t worry, you’ll get to view the home one way or another. But if you’re already represented, then going straight to the listing agent is considered is a faux pas in this industry (and a bit of a slap in the face to your agent). Just don’t do it.

6. "Real-a-tor"

The correct pronunciation is Real-tor. No need to throw that extra syllable in there.

7. "Oh, you sell real estate? You must make good money."

Hold your horses… not necessarily. According to NAR (National Association of REALTORS®), the median gross income of REALTORS® was $42,500 in 2016, and that’s before expenses like MLS fees, marketing, insurance and everything else. Also, keep in mind that commissions are split between the brokerages representing the buyer and seller. In other words, of that X% you paid your agent to sell your home, he or she saw only a tiny fraction of that.

8. "I’m planning to sell my home by owner. I just want to know how to do it."

We all know that time is money, but so is knowledge. It’s not always free, and it certainly can’t be passed from one brain to another through osmosis -- especially not how to sell a home. So if you ask this question to an agent, don’t be offended if you don’t get the answer you were seeking. It’s not that agents want you to fail… it’s just that advising you how to sell a home isn’t as easy as, say, forwarding a recipe for chocolate pound cake. I should know. Many people tried to replicate my grandmother’s chocolate pound cake. They even had the recipe. But they all failed miserably, every time. Bottom line? If you want to benefit from experience, be willing to pay for it (especially when it comes to real estate).

9. “I’ll only sell my home to a buyer who is (insert race, gender, religion, etc. here)”

This is a big no-no, and one that’s liable to get you sued (unless, of course, you list with a real estate professional who’d certainly know better than to discriminate). Federal equal housing laws were passed in 1968 in the wake of the Civil Rights Movement, and they prohibit renters and home sellers from discriminating against individuals on the basis of race, sex, religion and other factors. So in a nutshell: focus on getting your home sold, and forget about to whom.

10. "I'd love to get paid to look at pretty houses all day, every day."

So would agents. “Looking at pretty houses” is only one of about 184 things real estate agents do for their client

June 18, 2017

Maintaining Your Home

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Copyright 2017 NATIONAL ASSOCIATION OF REALTORS®