This Month in Real Estate, John Papasan talks about, 'The Spring Home Shopping season.'

Home Warranty Advantage

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Homeowners Insurance is great – it covers a lot of things like fire, theft and vandalism – and in case there is a storm that causes significant damage, the policy’s right there to protect the owner.  But what about a policy that looks after the interests of the property while it listed on the market and one that works to the advantage of both sides of the buying and selling fence?  A home warranty is a perfect supplement to a homeowner’s insurance policy and it broadens the overall coverage in a variety of ways.  Here is a rundown of the variances between the two and how a seller getting a warranty policy on their home for sale is a great tool!

 

The Benefits of a Home Warranty Policy

While home insurance largely covers catastrophic incidences and damage, a home warranty policy goes far beyond in that it address the home including wear and tear items.  Also, maintenance and repair is typically includes in a home warranty policy.  As a selling tool, this is fantastic, because during the process – or even after the home is sold – for up to 13 months, the areas of the home covered under the policy are warranted.  Oftentimes, a buyer will come across an issue with something in the home that could become a deal breaker but with the added peace of mind of a warranty, the seller can sit back and relax knowing that most things will likely be covered.  Examples of things that fall into range of coverage on a home warranty are flooring, plumbing systems, electrical systems, and wear and tear of these areas plus also the furnace and in come cases, the roofing or other major components of the home.

Home Insurance Policy Advantages

The single biggest difference between a home warranty versus a home owners insurance policy is that the latter covers the basic replacement value in general if there is a major catastrophe such as a storm that cause damage, fire, theft or vandalism or personal liability.  There is not personal liability coverage under the home warranty policy, rather it focuses on the “used” contents of the home.

How a Home Warranty Policy Helps in a Real Estate Transaction

Home Warranty of America is a company that provides very good coverage under their policy (for a list of their benefits, click here) including 13-months of free seller coverage, with coverage beginning on the first of their home being listed for sale.  The free coverage period for the seller lasts for up to 180 days and the policy is only paid for upon sale of the home at closing.  The best part of a home warranty policy is that even after the buyer has taken possession of the property, the coverage continues.  That means that as a seller, you will not have to contend with any last minutes issues that can and do come up. When applying for the warranty, be sure to choose coverage that address all potential concerns you may have for the home so that if there were a need for repairs or coverage, you would have it provided as a benefit.

An industry association held a study in which it was determined that not only do homes sell up to 50% faster when there is a home warranty policy in place, but also the selling price typically comes within three percent of the list price.  In today’s real estate market – this is an advantage that any seller would want to avail! We offer a Home Warranty with Home Warranty of America for the low cost of $420. Call us for details.

Should You Sell Now or Wait for Spring?

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One of the most common questions that we get each and every year is whether a home seller should try to sell their home during the cold, winter months or wait for spring to put it on the market? There are pros and cons to every situation, but I want to give you a few things to think about that you may not have considered.

Many people believe that it is always best to list and sell a home during spring. After all, isn't that when everyone else does it? Plus, there are some negatives to selling during the winter.

For one thing, winter is the holiday season. You have Thanksgiving and Christmas, among other holidays. Many people don't want the showings during the holidays. They don't like the idea of people walking through their home with snow on their shoes. They have their holiday decorations up and don't really want anyone messing with their festive home.

Many sellers think that there are less buyers during the winter, and that is probably true. However, consider this: buyers who are looking around the holidays are serious. Why else would they be looking for a home at that time of the year? Many relocation companies move employees during the winter because they want to get things done before the end of the year. Relocation buyers are often some of the strongest purchasers you can find.

Some sellers are also under the assumption that prices go up in the spring. Unfortunately, the current real estate market does not point to the idea that prices will rise in the spring. Experts hope that they do not fall further, in fact. Waiting for prices to go up so quickly may be a dangerous game for a seller to play.

There are some absolute positives to putting your home on the market during winter. First, the interest rates are very low right now. Buyers are getting into homes for 3.75% to 4% right now. No one can predict the future, so you want to strike while the iron is hot.

Also, there are less homes on the market in winter which means way less competition for a home seller. The greater metro area had 20% less listings going into the winter months than will be true during spring.

On a good note, homes are still selling. I checked the records, and last winter through February, our team sold 60 homes! I also checked the MLS records and saw that 2,363 homes sold last year in our area. Your home only has to be ONE of them.

In short, if you don't mind the little inconveniences of selling during winter, you can reap big rewards. Call on us today to find out more about putting your home on the market the right way.

20 Things You Can Do To Get Your Home To Sell Faster

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Want to have the upper hand on your selling competition?  Follow these 20 tips and watch your house sell faster than you can say, “SOLD!”

1. Apply a fresh coat of paint – try to use neutral colors that would appeal to most palates and would easily blend with most buyers’ tastes.

2. Stage the home – a buyer ideally should be able to envision living in the space. Set things up in a way that allow fluidity and extra space because better flow will be more attractive to prospective buyers and it will also allow them to see everything there is to see in the home.

3. Remove all traces of personalization – too many personal artifacts can hinder a sale because buyers can’t see the home for what it is. Keep things clean and try to set things up as you might see a home in professional photographs.

4. Steam clean all fabric surfaces – without realizing it, many homeowners neglect to clean much-needed areas and it costs them a sale.  Grungy surfaces will be cleaned, and it will also freshen up the space plus eliminate any odors from smoking or pets.

5. Replace less-than-perfect carpet – if you can afford it replacing stained carpet is a small investment that will go a long way.

6. Fix any loose ends – there are a surprising number of small things around the house that need repairing – usually items that can pop up during the buyer’s home inspection.  By working to address these items in advance, you save lots of time.

7. Decorate using neutral colors – neutral colors allow a buyer to imagine their own color palates rather than have to attempt to see through the homeowner’s tastes.

8. Provide incentives – pay for homeowners’ insurance for a year or leave existing paid for contracts of home-maintenance so that the new homeowners can use them till the contracts end.

9. Market the property using multiple marketing tools – Deviate from the standard listing practices and move toward the use of technological advances. Engage in proactive marketing such as using YouTube, Facebook, Twitter, 360-degree panoramic videos, individual property websites, instant real-time communication with prospects and more.

10. Hire a top-producing Realtor – the person you hire as your real estate agent will be a decision that will largely impact your success.  Top-producing Realtors usually have a wide network of associates, colleagues, business and person acquaintances as well as vendors and suppliers – all very useful to sellers.

11. Spruce up the curb appeal – The way a home looks from the moment one sees it is a very important impression on the buyer.  Neaten up messy flowerbeds, get rid of weeds, make sure the grass is watered and check the function of your storm door or entry-area.

12. Put out a new welcome mat at the front door – nothing says, “buy me” more than the feeling of warm, cozy and being welcome.  A nice welcome mat is a small expense but it has a large impact as the first impression.

13. Allow easy and frequent access to your home for showing – provide prospective buyers ample opportunity to access your home.  The last thing you want is for a buyer to be interested only to lose that interest if they can’t see the home quickly.

14. Be willing to negotiate – Don’t be hung up on the price or the concessions you offered from the start.  If the feeling is right, be willing to come down a bit on price or give a little more concessions.

15. Price it right – Here is a great article on Trulia about the 7 Deadly Sins of Overpricing your property.

16. Leave in the extras – Buyers are attracted to homes that have major appliances included in the deal – simple.

17. Get a pre-sell home inspection and address any issues – A move-in read y home is clearly going to be the first choice for buyers.

18. Offer to pay part of the closing costs – it takes concessions to appease the savvy buyers of today.

19. Give your pets a new home– Pet smells is a turnoff to someone considering your home.  Consider moving it temporarily until the open house and/or showing period is over.

20. Highlight the home’s best features – If your home’s open floor plan and a great crosswind are fabulous then do your best to show them off.  It will definitely be a selling factor giving you an edge over your competitors.

Comprehensive Fall Task Checklist

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DOWNLOAD YOUR PRINTABLE FALL CHECKLIST HERE

Organize and Get a Jump on Winter

The following list of chores includes tasks that need to be done every year, though some can be every two years or so. We've tried to include everything we could think of, but depending on your home and location, you may have other chores that are equally important.

In and around the house:

- Buy and store a supply of wood. Less seasoned wood may be cheaper; let it dry this year and use it next year. Just don't burn it until it's dry! Read more information about wood stoves.

- Have your backup heat source serviced. Wood stoves and pellet stove should be checked to make sure they are in good condition and ready for another year of service. Have your chimney cleaned, especially if you use a woodstove or fireplace a lot during the cold season. Find out more about chimney maintenance.

- Clean the gutters.

- Check downspouts and splash blocks. Water should flow freely away from the house.

- Examine the roof and gutters. Make repairs yourself, or hire someone, but do it now.

- Check ridge vents and make sure they are clear of any obstructions.

- Schedule heating system service if you haven’t done it in a while.

- Check the smoke alarm and carbon-monoxide detector. Replace batteries.

- Weatherize your home. Use caulk, weather-stripping, and check for new, inexpensive ways to reduce heat loss. We have a few energy tips that might be helpful.

- Check your foundation before winter sets in. It may be too late to do anything if you find cracks or damage, but you can take a picture and document any problems you find. It will give you a point of reference next spring when you make your post-winter inspection and give you an idea of how quickly problems are progressing.

- Wander through your home and make sure that all heat vents are clear. Stuff gets moved during the summer and often vents get blocked, especially in homes without central air conditioning.

- Replace that air filter before you turn on the heat. Pick memorable date (like the first Saturday of every month) and make replacing the filter a monthly chore. Buy a season’s supply of filters. Many come in packs of three or more and you can save money as well as time.

- Add insulation. If your home needs more, start at the top and work down to get the most for your money. Most warm air leaves through the roof so concentrate your insulation there, adding extra to the walls and under floors as time and money permit.

- Remove screens, clean, and repair before putting them away. Replace with storm windows if you don't have dual-pane, low-e windows.

Images by: http://www.freedigitalphotos.net/images/view_photog.php?photogid=472

Why Sellers Should Get a Pre-List Home Inspection to Ensure Better Selling Results

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With the state of our real estate market the way it is at the moment, sellers need to do all they can to ensure that their home sells.  Average days on market figures have been on the rise especially with the turn of the season toward cooler months, typically a slow period for real estate anyway.  But if you find yourself in the position to need to sell your home now despite all these factors, the last thing you can afford is to lose your sale to other homes on the street that may have been in better condition.

A pre-list home inspection is one of the best ways to remain proactive and manage any issues that may come up with your home so there are no additional hurdles in the sale process.

“But Why Should I Pay For It If The Buyer Is Responsible For The Home Inspection Cost?”

Even though it is customary for the buyer to order a home inspection on a prospective home purchase, the reason a seller would do so is to preempt any concerns that may pop up during the appraisal and inspection process ordered by the buyer.  The benefit of being able to know in advance any safety, structural or aesthetic concerns that may hinder the sale in the future puts the sellers at an edge over others who may not have done the same.

Being Proactive Rather Than Reactive

As a seller if you are actively making an effort to present your home in the best condition possible it only demonstrates your flexibility and willingness to accommodate buyers.  Today’s buyers are definitely more savvy and they know they have the upper hand in many cases so when they come across a seller that is willing to go the extra mile to make sure nothing goes wrong it only further solidifies the sale.  Not only that, what you do with the results of the home inspection is what really counts.  Proactively correcting problems that show up in the inspection is what needs to be done.

“If I’m Selling, Why Do I Need To Spend Money On The House?”

Too many times a seller will be daunted by a few dollars needing to be spent to fix up the house or bring it up to par and in presentable condition.  In actuality, spending only $200 on cosmetic things like a coat of paint or professional carpet cleaning is a small investment that will yield bigger returns when yours is the home that sells on the street.  Keep in mind that for you it is only $200 but it saves the buyer the hassle of doing the repairs or fixes and also they may not see the repairs as $200 worth during negotiations.  In fact, many buyers will try to squeeze out as much as ten times more if they can.  What better than to remove the ammunition from the buyer’s pricing gun when it comes time for negotiations? It is much better for the seller to be able to fix problems rather than to incorporate them into price.
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At the end of the day, by being just a little proactive rather than reactive you can avoid needing to defend issues that may come up during a buyer’s home inspection process, and end up netting thousands of dollars more on the sale of your home.

Better Prepared People, Walk Out With Better and Faster Results

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Prequalifying for a mortgage is a step that has almost become a necessity these days.  As the market continues to be a soft one, where buyers definitely have the upper edge, there is definitely some buying competition out there.  One way to have an extra edge is to show up with a prequalifying letter from your mortgage lender.   What do you need to take with you to the lender when seeking prequalification?

Two, Two and Two

Most lenders require two years of tax returns, two years of business tax statements and two months of bank statements.  If you are not self-employed, then instead of the business tax statements, it would be the previous two months’ paystubs.  As mentioned in the video, some mortgage lenders require just 30 days of bank statements and things can change here and there from one lender to the next.

Be prepared to asked for additional information – in fact, if at all possible, take whatever possibly relevant documentation that you feel may help you to demonstrate your ability to manage a mortgage and your financial viability.  This could mean evidence of other liquid assets, reporting other forms of income that may or may not be showing on the previous years’ tax returns, or anything else that might be useful.  You will need to provide your driver’s license at the time of applying for a mortgage prequalification too.

Full and Complete Documentation

If you provide the bank with incomplete documentation, it will only end up delaying your prequalification process.  When submitting tax documents, be sure to include the entire tax return, with every schedule, worksheet and attachment that was sent in to the IRS.  This can serve to avoid the need for a 4506t audit, which would only further delay the process – either now, or down the line.

Similarly, be sure to provide official bank statements rather than something pulled from the Internet.  It will be helpful when the statements clearly indicate that you are the owner of the account.
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All in all, the entire process can be a long and drawn out one especially in light of recent mortgage processing guidelines tightening.  As long as you are prepared to provide the lender whatever information may be necessary and are willing to be patient if it takes longer than expected at times, you can be on your way to owning a home, despite being an independent contractor or self employed person!