I am planning to buy new construction. Do I need a real estate agent?

by Sean Hess, Broker & Manager for St. Augustine Team Realty

It is a very good idea to get a real estate agent to help when you buy new construction. Here’s why.

A Realtor brings you a measure of protection.

Realtors are part of a builder’s life blood, so they want to keep their relationship with Realtors in good standing. If a builder starts jerking customers around, or building a bad product, word gets out in the real estate community. A Realtor won’t necessarily steer a customer away from a builder, but they will tell their customers what they heard and recommend a different builder in the same neighborhood with a better reputation.

So, if you are working with a Realtor, the builder will want to keep the Realtor happy and there will be less chance you will get jerked around.

Image by ArmchairBuilder

A sales agent in new construction cannot legally work for you against the builder.

The sales agents working for builders in new construction are almost always single agents. What that means is that they can legally only represent the builder. Everything they do must be for the builder’s benefit. They cannot offer you a good deal they may know about, because if they do that it would mean less profit for the builder. And if they work for your benefit instead of the builder’s benefit, they are breaking the law.

So, having a Realtor on your side puts someone on your team that can work for your benefit.

Is the home a good deal, a bad deal, or an okay deal?

When you go into a sales office the agent is going to tell you how great the house is, how great the upgrades are, and so on. But is it a good deal, is it a bad deal? If you are coming in cold you will never know.

The sales agent might offer you a $5000 upgrade package out of the gate when they were offering $15,000 last week. If you work with a Realtor it doesn’t necessarily mean you’ll get the $15,000 they were offering earlier, but you might get better than $5000 if you had that information in your back pocket.

The Realtor will help you after the build is done, but before you make the final sale.

When the home is built, a good Realtor knows to look for what isn’t there. Did X get installed? Did Y get installed? And for the things that were installed, were they installed right?

You might feel like you are being fussy or a bother about asking a builder to install something minor that is missing. A Realtor isn’t bothered by that at all. And a Realtor won’t mind helping you on your walk though or with pointing out punch list items. I even had home inspections done on new construction just to help the buyer feel more comfortable, something most buyers would never dare ask for on their own.

So get a Realtor in your corner before you go out looking for new construction, it will add a measure of transparency to the transaction and will put someone on your side.

Full article at http://staugustineteamrealty.com/TheStAugBlog/?p=2543

8 Tips for Finding Your New Home

By: G. M. Filisko

 

 

A solid game plan can help you narrow your homebuying search to find the best home for you.

When looking for your new house, make sure to take into consideration how long you plan to stay there. Image: Thinkstock Images/Comstock/Getty Images

House hunting is just like any other shopping expedition. If you identify exactly what you want and do some research, you’ll zoom in on the home you want at the best price. These eight tips will guide you through a smart homebuying process.

1. Know thyself

Understand the type of home that suits your personality. Do you prefer a new or existing home? A ranch or a multistory home? If you’re leaning toward a fixer-upper, are you truly handy, or will you need to budget for contractors?

2. Research before you look

List the features you most want in a home and identify which are necessities and which are extras. Identify three to four neighborhoods you’d like to live in based on commute time, schools, recreation, crime, and price. Then hop onto REALTOR.com to get a feel for the homes available in your price range in your favorite neighborhoods. Use the results to prioritize your wants and needs so you can add in and weed out properties from the inventory you’d like to view.

3. Get your finances in order

Generally, lenders say you can afford a home priced two to three times your gross income. Create a budget so you know how much you’re comfortable spending each month on housing. Don’t wait until you’ve found a home and made an offer to investigate financing.

Gather your financial records and meet with a lender to get a prequalification letter spelling out how much you’re eligible to borrow. The lender won’t necessarily consider the extra fees you’ll pay when you purchase or your plans to begin a family or purchase a new car, so shop in a price range you’re comfortable with. Also, presenting an offer contingent on financing will make your bid less attractive to sellers.

4. Set a moving timeline

Do you have blemishes on your credit that will take time to clear up? If you already own, have you sold your current home? If not, you’ll need to factor in the time needed to sell. If you rent, when is your lease up? Do you expect interest rates to jump anytime soon? All these factors will affect your buying, closing, and moving timelines.

5. Think long term

Your future plans may dictate the type of home you’ll buy. Are you looking for a starter house with plans to move up in a few years, or do you hope to stay in the home for five to 10 years? With a starter, you may need to adjust your expectations. If you plan to nest, be sure your priority list helps you identify a home you’ll still love years from now.

6. Work with a REALTOR®

Ask people you trust for referrals to a real estate professional they trust. Interview agents to determine which have expertise in the neighborhoods and type of homes you’re interested in. Because homebuying triggers many emotions, consider whether an agent’s style meshes with your personality.

Also ask if the agent specializes in buyer representation. Unlike listing agents, whose first duty is to the seller, buyers’ reps work only for you even though they’re typically paid by the seller. Finally, check whether agents are REALTORS®, which means they’re members of the NATIONAL ASSOCIATION OF REALTORS®. NAR has been a champion of homeownership rights for more than a century.

7. Be realistic

It’s OK to be picky about the home and neighborhood you want, but don’t be close-minded, unrealistic, or blinded by minor imperfections. If you insist on living in a cul-de-sac, you may miss out on great homes on streets that are just as quiet and secluded.

On the flip side, don’t be so swayed by a “wow” feature that you forget about other issues—like noise levels—that can have a big impact on your quality of life. Use your priority list to evaluate each property, remembering there’s no such thing as the perfect home.

8. Limit the opinions you solicit

It’s natural to seek reassurance when making a big financial decision. But you know that saying about too many cooks in the kitchen. If you need a second opinion, select one or two people. But remain true to your list of wants and needs so the final decision is based on criteria you’ve identified as important.


Read more: http://buyandsell.houselogic.com/articles/8-tips-finding-your-new-home/#ixzz2P46wH3TU

Should You Move or Remodel?

By: Dona DeZube, HouseLogic.com

 

When your house no longer suits you, you can move or remodel. Find out which big change is the right investment of your housing dollars.

Calculate how much your remodel will cost and add it to the value of your house. If the number is more than 10% above your neighbors' house values, you're over-improving. Image: Masterfile

Deciding whether you should move or remodel? The most important things you need to consider are the four things you can’t change: your home’s value compared to the rest of the neighborhood, how much you love your neighborhood, the size of your lot, and the cost to move your stuff to a new house.

 

Just about everything else—remodeling costs, the hassle of living in a construction zone, or the ability to live happily without one more bathroom—is a personal preference. After all, your home isn’t just your largest investment; it’s also the place where your family lives.

1. Will remodeling make your home better than everyone else’s?

To make the right move-or-remodel decision, you have to know:

• Your home’s value. Easy. Just ask a REALTOR® to estimate it and tell you how it compares with the value of the other homes in your immediate neighborhood. Ask her what she thinks your house will be worth after the improvements, too.

• Your neighbors’ home value. Hit some open houses. Seeing the inside of area homes will inspire you; help you make good choices about finishes, room sizes, and how much to spend; and, admit it, entertain you.

• Your remodeling costs. Once you’ve got your renovation vision, get a quote from a home improvement contractor or, if you’re remodeling it yourself, tally the costs of the items on your supplies shopping list.

Then add the remodeling costs to the value of your home. If the number you get is more than 10% above the average value of homes in your neighborhood, you’re over-improving and probably won’t be able to sell for what you put into the remodel.

Here’s why: No one wants to buy the most expensive home on the block (your home) if they can spend the same money to get a similar home on a block of higher-priced homes. Would you pay $200,000 to live on a block where all the other homes are valued at $100,000? We hope not.

Make home improvements that are typical for the neighborhood. Don’t put granite countertops in a trailer, and don’t put laminate countertops in a Trump Tower condo. Your tour of open houses gives you a chance to verify that your planned remodel isn’t an over- or under-improvement for the neighborhood.

2. Do you love where you live?

Want to keep your kids in the same school district, but can’t find or afford a bigger, better house? Love the neighbors? Have an easy commute to work? Stay put. If you’ve soured on the traffic, the neighborhood’s crime rate, or the nosy neighbors, move on.

3. Do you have room to expand?

If your remodeling plans include increasing the overall size of your home, the size of your lot may be the deciding factor in whether to move or remodel. If you live in a 1,500 sq. ft. ranch on a 3,000 sq. ft. lot, you might be able to add a second story to turn it into a 3,000 sq. ft. two-story, but you’re not likely to add 1,500 sq. ft. at ground level. And if you have a septic tank and well, the location of those will limit how and where you add onto your home (or cost you a bundle to move).

4. Can you afford to move?

Consider these moving costs: sale costs for your existing home, shipping your household goods, buying window treatments and possibly furniture for the new house, costs to fix up your existing home before sale, higher utility costs (if your next house is bigger), insurance cost differences, and property taxes.

Read more: http://buyandsell.houselogic.com/articles/should-you-move-or-remodel/#ixzz27nieVORy

Guess what? YOU'RE a person!!!

As an agent, I get a lot of questions from sellers regarding what is and isn't "the right" thing to do as we prepare to sell their home.  "What color should I paint the living room?"  "If I landscape the yard, will I get my money back on the sale?" "Robin, how do you remain humble about your vast and impressive knowledge of real estate?"  (Well maybe not all of those questions.)

I can typically divide these questions into two categories... style questions and "should I" questions.

Style questions are questions about things such as paint color, landscaping, decorating, etc., and are easy to answer.  Just remember one rule... offend the least number of people.  New homes are painted and tiled in light, neutral colors, not because everyone loves neutral colors, but because the least number of people HATE neutral colors.  Now of course if you have a knack for decorating and feel confident leaving the neutral zone, then by all means go for it.  However, if people describe your tastes as "whimsical", if you feel that the Taco Cabana motif can also blend well in the home, or if you're like the rest of us and just don't know, then you do yourself a favor and stick with neutral.

So that's it for style questions... very easy.

As for the "should I" questions... such as, "Should I clean out the garage before we put the house on the market?" or, "If I replace the carpet, will I get my money back on the sale?" or "Can I leave Mr. Boot's litter box in the utility room?"... on those questions, I'm going to let you in on a secret that most agents don't want you to know.  Ready?  Alright, here it is...

The people that buy your house... are going to be people!  That's right... a person is going to buy your house.  Which is perfect, because guess what???  You're a person too!  And as a person, you're in the perfect position to answer many of these questions.  So let's give it a try...

Do I have to leave the house when people come to view it?
Well, we want the people who are looking at your home to feel comfortable.  We want them to feel free to look around and check it out... and hopefully imagine it being their home some day.  So if YOU were looking at a house, would you feel more or less comfortable having the owners hanging out in the same room?  Less, of course.  There's your answer.

Easy, right?  Alright, another...

If I spend $2,000 replacing our laminate counter-tops with granite, will I get my money back on the sale?
Well, your agent should be able to tell you which improvements will give you the highest payoff on your investment, but even then it's not an exact science.  So, if you were looking at a house in your area and saw one with new granite counter-tops, would it increase your impression of value by $2,000 or something close to it?  Probably, right? (depending on the price range of the home)  So, yes granite may be worth looking into if you have the resources.

Now as for your $50,000 in-ground pool, the $500 phone line you had installed next to your toilet, and the $7,000 imported Venetian glass chandelier... you can kiss that money goodbye!  They may have value to you, but hopefully you can see why the average person would not pay your cost to have them.

Alright, one more...

Can I leave my dogs in the house when people come to view it?
Sure you can!  It's your house... you can set up an emu farm in the living room if you want! (subject to city approval)  But should you?  No!  Would YOU want someone's dogs jumping on your family while you were trying to shop for a home?  Of course not.  As a buyer's agent, I can't tell you how distracting and detrimental it is when a seller leaves little Sparky in the house to greet us.  I know you love him.  I know he's just like family.  I know that when you found him he was just a puppy and he was abandoned by the side of the road, and you saved his life, and in the mornings he lays in your lap while you watch The Today Show and the two of you share an indescribable bond with each other.  I know, I know, I know!  But the people looking at your house don't know... or care.  They just want to see the house.  Do yourself a favor and take Sparky on a walk... he'll love it!

So at the risk of marginalizing my real estate degree, let me say this... a lot of this stuff is not rocket science!  Detach for a moment and put yourself in the position of the buyer... many of these questions will answer themselves.  Your agent should be able to back up your assumptions with solid data and experience so that, together, the two of you can make the correct decisions before and after your house goes on the market.

The "First Week Flash!"

There is a misconception among many sellers that the smart thing to do when selling a home is to start high on the initial asking price.  "That extra cushion in the asking price will give us some room to negotiate", they rationalize, "And who knows?  Maybe, someone will come along and offer more than market value!"

What most sellers don't realize is that pricing their property too high upfront is the equivalent of shooting themselves in the foot.

When your property first goes on the market, you have a very short window of opportunity... a brief period of time that I've heard some agents refer to as the "first-week flash".  This is the period of time when potential buyers see your new listing and feel a higher-than-normal level of interest in your property.  After all, this listing has only been on the market for 2 days!  Maybe it's a great deal and no one has had the chance to jump on it yet!  This is a powerful exercise in market psychology and something to take note of. Understanding and taking advantage of this phenomenon is the reason many of the houses I list for clients have an offer (at market value) within the first 10 days. 

Still, time and time again I see sellers give into the urge to grab for a little more money, and waste this window of opportunity.  Rather than list at market value, they shoot too high and negate any initial interest they may have garnered from the market.  And several weeks later, after no success... they'll reduce the price.  But by that point their house has been stigmatized by it's own DOM (days on market).  Instead of being excited and curious about the new listing in the area, buyers are now suspicious and critical of the property.  "Why has that house been listed for 125 days?", they'll wonder, "Something must be wrong with it, otherwise someone else would have bought it by now."  That's not to say that a price reduction won't help or that houses can only be sold in the first week, but you'll never recreate that initial flash of interest.

So bottom line... be reasonable in your expectations.  They call it "market value" for a reason... it's the value the market is willing to pay!  If you shoot high, you're only shooting yourself.  But if you price it right on day one, your property will have a big advantage over the competition.