Indy Home Book » For Home Buyers

Building in Winter

Richard — Sat, 14 Jan 2012 05:27:04 +0000

The winter weather doesn’t phase the progress on new home construction very much around here. It takes a little coordination so that the foundation work is done prior to or after the coldest weather. But there are usually enough good weather days afterwards to frame the home, get it under roof and finish the exterior work all through the winter months. This home in west Carmel that I previewed with clients today is just now completing the drywall stage. Portable gas heaters were keeping the temperature toasty inside to dry the water from the just finished drywall. All the interior finishes and fixturing can be done in even the coldest weather. This home should be completed by the end of next month.

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2012 – Day One

Richard — Mon, 02 Jan 2012 01:43:57 +0000

I spent the late afternoon of the first day of 2012 by showing homes in west Carmel to some buyers, and on my way home I couldn’t resist stopping briefly to take this photo of the Clock Tower in Coxhall Gardens which was lit up like a beacon in the dwindling twilight. Even though it’s a holiday, I didn’t mind working a little while. It didn’t take that much time, plus I really enjoy being with them which is the most important thing. It makes it fun. Normally I’d wonder about setting an appointment to show someones home on a holiday, but I could tell by reading the listings that the homes were vacant. So, very easy to show without intruding in the sellers home or their plans.

Just like everyone else, I have a personal life too, but I’ve been doing this for so long that it’s second nature to change into my Realtor hat for enough time to take care of whatever needs to be done, and then take it off again. The communication technology that we have nowadays helps to make that possible by allowing me to be anywhere with all resources at my command.

Today was a good day. Wondering what the rest of 2012 will bring. I’m an eternal optimist.

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Choosing the Right Home

Richard — Mon, 19 Sep 2011 15:00:08 +0000

Even though each home Buyer has very different goals and vision of their next home, there are similarities in the home buying process every time. Moving to a new home is a pivotal event for anyone, and it’s not uncommon for the whole process to take a year, sometimes two or more until the actual move is completed. It takes that long for the ideas, feelings, vision and motivation to evolve and for the right home to cross their path. A home is so much more than just bricks and mortar, it needs to dovetail with all the facets of their lives. The initial vision always changes along the way as the Buyer begins and continues to encounter the market, either looking at properties online, in print media, Open Houses and viewing inside and out with their agent. The vision changes as they get a handle on the market, what is available for sale and what has sold…and largely about value as it relates to location, features, quality, etc. Even more important, they discover things about themselves, what they really like, what they don’t like, what they have-to-have and what they absolutely do not want. Each home they encounter asks questions and something inside themselves gives an answer. Finally the right home crosses their path and begins “talking to them” from the moment they pull up outside. The dialogue continues as they walk the exterior and tour the interior, and afterwards as they reflect on what they have experienced. Sometimes I wonder if a Buyer chooses their new home, or if the home chooses them? For me it’s an interesting process to witness every time, to contribute to and be a part of. The intent is simply for them to be happy.

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Selling Homes One by One

Richard — Thu, 01 Sep 2011 18:42:27 +0000

A transaction I had been working on for quite a while closed today. As closings go it was a little different because the buyer wasn’t local and couldn’t attend on the day closing was to be. So the seller signed their documents here, then copies overnighted to the buyer and signed the next day, and overnighted back to be finalized on day three today. Usually buyers and sellers along with their agents meet at a title company together to close, and the whole process takes usually a little less than an hour. But I’ve seen all kinds of variations of that. Like, one party is only free in the morning and the other party is only free in the afternoon…so a two part closing. Or occasionally there is a divorcing couple who are selling but don’t want to be in the same room as each other. That’s kind of fun to deal with, but we do. Anyway or either way, all’s well that ends well so they say. My focus is on making sure my client is happy with the outcome and try very hard so that the other party is too. That time is an important one in people’s lives and the closing should be friendly and a have positive energy to it. One chapter ending and another beginning for everyone.

I had closings on my mind so I took a look at the stats today for the nine counties that make up the greater metropolitan Indianapolis area. Our Board of Realtors site says that so far this year 14,353 homes or condos have sold/closed in 2011. And there are 15,193 homes or condos that are listed for sale. If you are one of those that has a home for sale or thinking about putting your home on the market, as you can see, homes are selling…one by one.

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Details, Details. Getting a Mortgage Loan

Richard — Sun, 28 Aug 2011 17:05:29 +0000

One change that happened as a result of the sub-prime mortgage meltdown a few years back is that the government reacted by tightening up the lending rules and documentation needed for obtaining a loan… or as I like to put it, they stopped all the funny business going on. The old rules were too loose and there was poor oversight and a lot of bad loans were made, quite a few of them on purpose it’s sad to say to people who didn’t deserve them. We all paid the price for that huge bailout to Wall Street who bought large portfolios of what turned out to be bad loans. Amazing what greed will entice people to do, or maybe not so amazing? But we continue to pay the price now with tighter restrictions to even the most credit-worthy individuals. The consensus is the government was too loose before but now they have gone too far the other way. Have you gotten a new mortgage lately? The process can be arduous. What’s driving that is there is tremendous oversight of every detail imaginable on lenders themselves, and at any time they can be audited for paperwork. So, the list of documents they ask from borrowers is long and questions asked are detailed. Lenders can’t take a chance on being reported for a violation. So, don’t take it personally if applying for a loan, everyone else has to do the same thing. Besides, it’s worth it. Have you seen the rates these days? My advice to borrowers, just give the lender the documents they ask for. Smile and jump through every hoop. They need it or they wouldn’t ask for it. Besides, if you don’t, you won’t get the money!

Take a look at today’s rates… updated daily. Current Mortgage Rates

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Counter Offer Strategy

Richard — Sat, 20 Aug 2011 23:18:52 +0000

Now days, when an offer is made on a property, it feels like there are larger differences of opinion on price and terms between buyers and sellers at the start of negotiations, than what’s been typical. That doesn’t mean it’s that way for most properties, but I’ve seen and heard of some crazy-low offers being made on properties these days, even if the property is priced correctly. I guess I don’t blame people for trying to get the best deal possible. It’s a free market. But I think some have been watching too much television or taking bad advice away from articles they have read. The media enjoys making all-inclusive general statements about anything. That’s what they do. It could be a piece about a slow real estate market someplace, or comments about a financially distressed property situation here or there, and so somehow that is processed by some to believe that every seller, every home is ripe for a low-ball offer now. It’s kind of interesting times actually. I honestly haven’t seen it quite like this before, ever.

But the offering strategy is still the same as it always was and always will be. Buyers offer what they want for whatever reason seems appropriate to them, and Sellers counter with what they would like to do or need to do. And the dialogue continues with more counter offers until they either agree, or disagree. Each home, each Seller, each Buyer has a different set of circumstances. Some Sellers don’t have any room to negotiate because of what they owe. Some do. Some absolutely have to sell. Some don’t. Some Buyers must buy a home to move into by a certain date. Some don’t. There are endless examples to give. The point is, in a national market there are millions of different situations…and every local market is made up of thousands of unique situations. Each neighborhood has homes with dozens of different story-lines and each individual home has different circumstances that effect the outcome of an offer. So…let the negotiations begin.

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Accepted Offer…Buyers Agent

Richard — Fri, 29 Jul 2011 00:00:38 +0000

It’s best to be very patient when searching for a home, waiting for just the right one that matches your vision, encountering properties online, in print, and on foot, waiting until just the right home appears in your sights. And then it’s best to pull the trigger quickly on submitting a written offer to purchase so it doesn’t get away to someone else. Usually after some brief negotiations, the offer is accepted by both Buyer and Seller. Upon acceptance of an offer, as a Buyers agent, I change hats from a market expert and search facilitator, to a transaction specialist and closing coordinator. As the home-search process began, I would have made sure you obtained a pre-approval for a loan by a lender you feel comfortable with…not a pre-qualification that isn’t worth the paper it’s printed on, but a pre-approval where the lender has analysed your credit report and scores, and you have submitted all your financial data, with the lender approving your loan subject only to finding a suitable property in your price range. I always include a Buyers pre-approval letter when submitting an offer to the Sellers agent as the Seller will feel more confident about accepting the offer and taking the home off the market. If the financing is ready to go, then a Buyer is already about half-done on their end when an offer is accepted. As a Buyers agent, I watch all the details of the Purchase Agreement (Offer to Purchase) and make sure the process goes according to plan for the Buyer within the terms of the Purchase Agreement which is the last word on what will happen in the transaction. The title policies are ordered from a title company who will also close the sale. I supply the title company with all the information and documentation necessary for the buyers side of the transaction and coordinate the closing with the Sellers agent. I also stay in touch with the lender and Buyer to make sure the loan commitment is finalized and that funding of the loan is on track with the closing. Also, a commitment must be obtained for the homeowners insurance policy, to be in force on the property at the time of closing.

Beside financing and title work, the other major piece of the sale is home inspections. This gives the Buyer the opportunity to understand exactly what they are buying and approve the condition of the home. Every sale can be different as each buyer has different concerns and every home has potentially different issues that warant an inspection. Typically though, most buyers get a whole-house and a wood-destroying insect inspection. They sometimes want an interior air quality report too to detect levels of radon gas, and probably less frequently a lead-base paint inspection if the home was built prior to 1978 before manufacturers stopped adding lead to house paint. Typically, if the whole-house inspection reveals the possibility of mold or lead-base paint, then an inspection from experts in those fields can also be ordered. All inspections are usually completed within a week or two after an accepted offer, so the Buyer can study the results and respond in writing to the Seller if there are any major defects in a home that they feel they just cannot live. Under Indiana law, “Defect” means a condition that would have a significant adverse effect on the value of the property, that would significantly impair the health or safety of future occupants of the Property, or that if not repaired, removed, or replaced would significantly shorten or adversely affect the expected normal life of the premises. If there is a major defect that the Buyer feels must be addressed and the Seller is unwilling or unable to repair, the Buyer can terminate the agreement or waive the defect and continue toward closing. Homes are very complex, and there are almost always things that are not in perfect condition, but inspection negotiations are usually worked out one way or another between Buyers and Sellers.

With the loan on track, the agreement on inspections in the rear-view mirror, and me watching all the remaining details, there is nothing to do but coast into closing and get ready to enjoy your new home. Well, that is, after the packing and moving trucks are finished!

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Second Showing

Richard — Sun, 10 Jul 2011 13:38:54 +0000

When an agent wants to set an appointment to show my listing, they contact my scheduling service and shortly afterwards I get an email notification from the service with information about the appointment time and the agent who is showing it. The service can tell if the agent has shown this property before, and if so, asks them if it’s a second showing. If it is, the email I receive will say “2nd Showing” someplace on it. That’s semi-interesting to know as it means there might be deeper interest from a prospect that saw it before. A lot of times, buyers come back at least once again before moving forward with a written purchase agreement. But if a property is special and in a highly desirable area then it could be gone if they take their time trying to decide. As a listing agent, it’s good when there’s a second showing, but long ago, when I was just starting in the business, I excitedly told a seasoned agent that there was a showing on my listing and they remarked “showin’ ain’t sellin”… translated, a showing means nothing unless there’s a written offer, and one that is accepted. To prove that point, I’ve had homes listed that received over 50 showings, several of them second showings, without an offer. If so, 99% of the time that means it’s a desirable home but the market feels it’s way overpriced.

If I’m on the other side, working with a buyer, then the most important thing is that they feel comfortable with any decision, so accompanying them to look at a home several times is perfect with me. But if the home is very close to the description of what they are looking for and a desirable property on the market, it’s in their interest for me to remind them that it could be gone if they take their time making a decision. I’ve seen people loose a home they really wanted because their offer was minutes later than another one that the seller just accepted.

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Diminishing the American Dream

Richard — Wed, 18 May 2011 18:57:05 +0000

I stay away from politics normally, but this is an needed exception. There is a Bill being considered in the US Congress now that everyone needs to be aware of who owns a home or who may buy one in the future. It proposes changes to regulations involved with Qualified Residential Mortgages, drastically changing the rules of who would be able to obtain a mortgage loan. Sellers and Buyers would both be impacted by this. It would be a lot tougher for Sellers to sell their property and so the value of their property would be affected as well. Essentially it requires that even the most credit worthy buyers have a minimum of 20% down payment in order to get a conventional loan to purchase a home. Buyers with excellent credit can now purchase homes with 10% or even 5% down payment now. Please read this White Paper for more details and what the impact would mean.

The intention was well meaning…strengthening lending laws so there won’t be another meltdown like the one a couple years ago due to the sub-prime mortgage debacle. But this just shows what can happen when non-experts don’t think things through in a practical way. The proposed regulatory provisions are too narrowly defined. If you thought the market has been tough the last few years, that would be nothing compared to what would happen if this were to pass. Owning a home would be out of reach for a huge number of Americans. According to the National Association of Realtors research, 60% of recent home buyers made less than a 20% down payment, and it would take 14 years for a typical person to save up a 20% down payment to buy a median-priced home.

I’ve contacted my Senators and Congressman about this already. But if you feel inclined to weigh in with your respective congressmen on this issue, please call, email or write them. If you are from Indiana, here are links to the contact information for Senators Coats and Lugar. For all other states Click Here and “Find Your Senator” in the box in the upper right. And for contact information for the Congressman representing your district, here is a link to the US House of Representative website. Just input your zip code in the box in the upper right.

I strongly believe that this Bill would wrongfully diminish home ownership and is counter-productive to strengthening our economy. Owning our own home gets us involved as citizens in making the country a better place to live, and is one of the cornerstone concepts, right along with freedom and liberty.

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Horizontal Living

Richard — Mon, 04 Apr 2011 02:51:19 +0000

Easily the most efficient design for a home is the traditional two-story. A one-level home with the same square footage costs a lot more to build, as the foundation and roof could be twice the size of it’s two-story version. The electric wiring, water lines and furnace runs needed for a one-level home are longer and therefore add more to building costs too. After being built, a two-story home usually is more efficient to heat and cool as well. But despite those logical reasons for a two-level home, the one-level home becomes the one that’s the most practical at a certain point for most people. The reason is simply the stairs. As people age, having to traverse the stairway over and over becomes less attractive and why they feel like making a change to a one-level home. It’s always been like that, but there is an increasing demand for one-level homes in recent years because the average age in the population is increasing. Some make the change at a younger age than others, but it’s inevitable for most people, that their two-story home will at some point become less attractive to them. The problem is, there really aren’t enough one-level homes around that have the modern amenities and features that people want nowadays. Builders aren’t really building very many spec homes these days, especially one-level varieties. So having a custom home designed and built is sometimes the only solution to get a home exactly like what they want. Even though existing home sales have always been the largest part of my business, helping people with building a new custom home occurs more often than it did before. I think it’s a sign of the times and the increasing popularity of the one-level home. Horizontal living…the idea gets better with age.

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