Author: yajneshkw

Six common mistakes made by first-time home buyers | PhillyVoice

The list of mistakes, both big and small, that first-time home-buyers make is a long one. No buyer, no matter how knowledgeable, is immune to all of them. But the following six are among the most common, and they can all be avoided largely just by being aware of them – and exercising some self-control and common sense when the excitement of the moment takes over!

Skipping the home inspection

It’s such a temptation when you’re eager to be a homeowner to say forget about the inspection. Inspections can be a downer, uncovering expensive repairs, throwing a monkey wrench into the closing date, re-opening negotiations with the seller. But buying a house without truly knowing the shape it’s in is a recipe for disaster. And often only the trained eye of a home inspector can see the really serious issues or flaws. Even if the inspection is time-consuming and inexpensive, causes delays, and may complicate the deal, it’s not something you can skip.

Not getting pre-approved for a mortgage

Every real estate agent has disappointing stories of clients who decided a particular home was perfect for them, only to discover later that they couldn’t qualify for a mortgage that would cover the purchase. Whatever your credit score or income, it’s essential to get pre-approved for a loan before placing an offer on a home. That way you can avoid wasting everyone’s time, including the seller’s, the brokers’, and your own. If you’re shopping without a pre-approved mortgage, you in essence have no real sense of what you can afford. Veteran real estate professionals have a saying: home-buying doesn’t begin with looking at houses, it begins with getting pre-qualified for a mortgage.

Not having any ‘vision’

Many first-time buyers have looked at so few properties in their lives that, when shopping for their first house, they get caught up in insignificant and irrelevant details – the color of the seller’s drapes, too-loud wallpaper in the dining room, or the fact that the kitchen is cluttered with the seller’s toys. They forget that they have to look beyond all this at the bones of a house – its overall condition, location, floor plan, and value. Cosmetic fixes and inexpensive repairs are easy. Also, it’s a mistake to be too picky. You can have a “wish list” of 50 features you want in your first home – but the home, in your price range and desired location, that has all 50 features does not exist. Home-buying, like so many things in life, requires compromise.

Trying to go it alone

Reputable real estate agents, expert loan officers or brokers, experienced real-estate lawyers – all these people all partners in the home buying process. It’s a classic amateur error to try to do-it-yourself. The complexities of residential real estate sales these days almost always make that a fool’s errand. Make sure you buy your first home professionally – and correctly.

Spending all your money on down-payment and closing costs

With a 20 percent down payment, most conventional mortgages waive the requirement of having mortgage insurance – which can be expensive. Because of this, many first-time buyers will struggle to put together the 20 percent down payment and use up all their savings – leaving them cash-poor in a new house. This is never a good position to be in. Better to put down 15 percent, pay for the mortgage insurance, and leave yourself the cushion you’re sure to need.

Making up your mind on one visit

It’s surprising how many people don’t return to the house they’re planning on buying several times before actually closing the deal. Have you seen the house at night? On weekends when children are playing? When traffic is heavy? Do you have any sense of the kind of neighbors you’ll have? Falling in love with a house at first sight is great. Now spend some time to getting to know it before submitting an offer and there’s no turning back.

No buyer does everything right, and in retrospect you can always point to “coulda woulda shoulda” things you might have done differently. However, you can at least be aware of the major, avoidable mistakes up front. It’s still true — buying a house is, for most people, the single largest investment they’ll ever make. The fewer errors you make along the way, the better.

Five Reasons To Work With a Realtor and You Can’t Ignore The Fourth | HULIQ

Many home buyers and sellers are wary of working with a real estate agent to buy or sell a property. However it is important to note that a transaction of sale involves many details and requires the participation of several specialists (Realtors, mortgage loan providers, home inspectors) from various areas, especially if the buyer is a foreigner or if the purchase is made through a mortgage financing.

Here are five reasons to visit a real estate agent for your when buying or selling a house.

The first is that the Realtor is a licensed professional. This means, for peace of mind, that the course of the real estate agent’s work should be done within the legal framework governing the profession’s department. Otherwise the Realtor puts his or her license at risk.

Second: The Realtor is a facilitator who is able to deal with all parts of the required process and ensure that the times of the contract documentation are met. Also, the Realtor is not interested that you buy a specific property, but rather the one that best suits your needs and makes you happier, or represents a good investment opportunity.

Third, is that the Real estate agent is a negotiator who knows the business environment and is working for the client’s benefit to obtain and negotiate qualitative and quantitative benefits within the transaction. Your Realtor’s interest is to achieve his or her customer’s satisfaction through a successful transaction that meets your expectations.

Fourth: The Realtor is a promoter. When selling your home, in addition to announcing the house for sale, your Realtor develops and entire marketing plan through other ways and colleagues ensuring you get the best fair price for your home. Your Realtor interviews and filters potential buyers and coordinate visits of only those stakeholders that are pre-qualified to purchase (How Buyers That Aren’t Pre-approved for a Mortgage Loan Are Hurting Themselves). This avoids the visits by curious people who don’t have the ability to purchase your home, saving you time.

If You Are a Home Buyer

Fifth, is that the good Realtor is a diligent representative. When they help you to buy a house, they can search for properties that meet your future needs at a price you are able to pay. They arrange appointments, and will keep you informed of new properties that go out to market with similar characteristics. And best of all, the commission is paid by the seller because the seller is more interested in selling the property.

Tips on buying your dream home

Everyone knows that buying a home is a serious decision, but choosing the right realtor is just as important.

There are many aspects to consider when hiring a realtor. Heath Anders and Matt Pierce from Anders Pierce Realty described a few tips and tricks for hiring a realtor and choosing your dream home.

First, it’s essential to get along with your realtor. Having a trustworthy realtor can make the home-buying process easier and less stressful.

In addition to being personable and responsive, the best realtors are familiar with things like building restrictions in certain neighborhoods and floodplain locations.

“You want somebody local who really knows the area,” Pierce said.

No matter how perfect a house seems, it’s important to get an inspection before putting in an offer.

“Whether it’s a new house or it’s a 100-year-old house, get it inspected,” Anders advised.

Finally, don’t forget to have your finances in order before you make an offer. Taking the extra time to find a trustworthy lender can make the difference between closing and losing out on a home.

Mortgage Rates Are Staying Below 4% | Realtor Magazine

Interest rates may remain lower longer than originally expected. The Federal Reserve released recent comments that suggested it may continue to hold off in raising short-term interest rates and weaker-than-expected consumer demand is all pushing Treasury yields lower.

“As the shock of the weak September employment report wore off, Treasury rates drifted higher,” says Sean Becketti, Freddie Mac’s chief economist. “In response, the 30-year mortgage rate climbed 6 basis points to 3.82 percent, marking 12 consecutive weeks below 4 percent. Late-breaking news suggests mortgage rates may remain in this territory a while longer. After this week’s survey closed, Federal Reserve Governor Daniel Tarullo was quoted suggesting the Fed may not act this year, and Wednesday the 10-year Treasury closed under 2 percent in reaction to economic releases indicating weak consumer demand.”

As such, for the 12th consecutive week, 30-year fixed-rate mortgages have remained below 4 percent.

Freddie Mac reports the following national averages with mortgage rates for the week ending Oct. 15:

• 30-year fixed-rate mortgages: averaged 3.82 percent, with an average 0.6 point, rising from last week’s 3.76 percent average. A year ago, 30-year rates averaged 3.97 percent.
• 15-year fixed-rate mortgages: averaged 3.03 percent, with an average 0.6 point, increasing from last week’s 2.99 percent average. Last year this time, 15-year rates averaged 3.18 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 2.88 percent, with an average 0.4 point, holding the same as last week. A year ago, 5-year ARMs averaged 2.92 percent.
• 1-year ARMs: averaged 2.54 percent, with an average 0.2 point, dropping from last week’s 2.55 percent. Last year at this time, 1-year ARMs averaged 2.38 percent.

Beware Home-Selling Myths – NASDAQ.com

Like many folks, you sell a home only a few times in your life and so likely don’t know the potentially tricky rules and laws concerning real estate sales. Here are some half-truths, both new and established.

Recent data say that the average American buys and sells a primary home about every eight years – many move far less frequently – for reasons ranging from wanting a different size dwelling to change of a job. A lot of information about the tax consequences of selling a home fly around the Internet and other sources – some mostly bunk and much of the rest limited in applicability.

Understand a few of these half-truths before you sell your home and how they may or may not apply to your situation.

If I sell, I need to buy another home with the proceeds or owe tax.  Untrue as long as you live in the home as your primary residence for two of the preceding five years. An exemption of the tax on such a residence sale permits up to $250,000 ($500,000 for a married couple) of gain in value over the original purchase price plus improvements to the property.

For example, if you purchase a home for $100,000, update the kitchen for $10,000, live in the house for three years and then sell it for $120,000, you realize a gain of $10,000 on the sale. This sale is exempt from tax since you lived in the home as your primary residence for at least the required two years.

Roots of this half-truth reach back to a law, expired in 1996, that when you sold your primary home you needed to purchase a new one within two years with any gains from the sale. Many folks think this stipulation still applies since they haven’t sold a home in a long time.

If I sell my home, I owe an extra 3.8% surtax due to Obamacare. True only in some limited cases. This one gets traction via emails and Internet postings and enjoys a rather long life; I wrote about it more than two years ago.

Using numbers in the above example, you might owe the surtax if you wind up with a non-exempt gain on the sale of your primary home. This could happen because either you didn’t live in the home for two of the previous five years or the gain exceeded the exempted limit and your modified adjusted gross income exceeds $200,000 for singles or $250,000 for marrieds.

I can write off against income any loss on the sale of my home. Not true for a primary or secondary home. You generally don’t pay capital gains tax on a gain when you sell your home. Likewise, you can’t take a capital loss if you lose money on the sale.

This applies for all personal property not held for investment purposes. If you sell a rental property at a loss, you can write the loss off against other investment gains.

Changing homes causes enough stress. Know the truths from the myths about home selling before you even stick the sign on the lawn.

The Sneaky Science of Selling Your Home Revealed! – Real Estate News and Advice – realtor.com

Selling a home isn’t just about slapping down a fresh coat of paint—you need to delve into home buyers’ brains and figure out what makes them tick. From the moment they spot your listing to the instant they walk through your door, what persuades them to make an offer, and stick around to close the deal? To find out, we culled the most recent scientific studies that examine the home-buying mind to find out what turns it on—and off—and how you can use this information to your advantage.

Buyers know within seconds if they want a home

With a decision as weighty as a home purchase, one might think that buyers deliberate over all the pros and cons before they decide to sign on the dotted line. Yet studies show this is not the case.

According to the “Psychology of House Hunting” report by BMO Financial Group, 80% of prospective buyers know if a home is right for them within seconds of stepping inside. The reason? Researchers theorize that our minds process far more information in less time than we think, so a lengthy deliberation process may be a waste of time.

Take-home lesson: Since buyers know within seconds of entering your home whether it’s The One, you’ll want to spiff up the area they’ll see in that time frame—namely, your foyer.

“It can be a challenge to keep this area tidy since that’s where homeowners put their mail, keys, coats, shoes, dog leashes, and other items,” says Sissy Lappin, a real estate broker

Containers are key for keeping this mess under control: baskets or racks for shoes, bowls for keys and change—and, unless you have a nearby closet, you can never have too many coat hooks. Be sure to stash any seldom-used items elsewhere. Anywhere else.

They find aromatherapy confusing

It’s not all about what home buyers see; what they smell matters, too. But that doesn’t mean you should fill your home with potpourri or freshly baked cookies.

These “complex” scents can actually backfire in homes, according to a study by Eric Spangenberg at Washington State University, who found that shoppers will spend 32% more in stores where he piped in a simple orange scent rather than a multifaceted blend of orange, basil, and green tea. The reason? Complex scents may be nice, but they’re also more distracting as people try to figure out what they are.

As Spangenberg explained to the Wall Street Journal, “They are not there to process the smells. They are there to process whether this is a place they want to live.”

Take-home lesson: If you go for a scent, keep it fresh and simple. Spangenberg recommends lemon, basil, or pine. You have no time to grab scented candles?

“As a quick fix, I splash Pine-Sol down the sink,” says Lappin. “While certain scents might appeal to one gender but turn off the other, everyone loves the smell of clean.”

They’re wary of the number 9 in a price

On just about any shopping spree, we’re wooed by “charm prices”—in other words, T-shirts or towels priced at $9.99 rather than a round $10—because consumers tend to think that prices ending in 9 are a way better deal. Only with big purchases like homes, charm pricing makes buyers wary.

 

According to a study by Old Dominion University, 9’s near the end of a home price—say, $199,000 versus $200,000—are a turnoff. Why? Because these homes appear to be trying too hard to look like a bargain, and buyers don’t like that whiff of desperation when it comes to such a big purchase.

Take-home lesson: Avoid 9’s near the end of your asking price, because buyers may have a knee-jerk impulse to turn away.

“Charm pricing may be fine for T-shirts, but it looks sleazy on a home,” Lappin says. “You feel like you need a shower after seeing the price.”

Prices with round numbers are a turnoff, too

Another number no-no? Pricing your home with round numbers with lots of zeroes, like $200,000, seems like you pulled this number out of a hat. A more specific number like $217,000, on the other hand, makes it look like you’ve really done your homework and know exactly what your home is worth.

One study by Columbia Business School found that negotiators who ask for specific amounts are more successful than those who make rounded offers.

Take-home lesson: Avoid the round number trap and make sure your asking price is specific.

“It will sound like you’ve run the numbers on your home, right down to the exact square footage,” says Lappin. “Oftentimes buyers will ask, ‘Where does this number come from?’ and I’ll say, ‘This seller has done their research and it will take an hour to explain it.’ That’s usually enough to convince them to fall in line.”

Buyers fall hard for staged homes

Staging a home to sell is all the rage these days, and research shows it works: A study by the Real Estate Staging Association looked at 63 unstaged homes that sat on the market for an average of 143 days. Once those houses were professionally staged, they sold, on average, 40 days after their makeover.

Take-home lesson: Pay attention to presentation. But you may not have to open your wallet for a professional stager; the basic premises are simple ones that anyone can put into practice. For one: If you’re already moved out, get some furniture back in the house.

“Seeing a house without furniture is like seeing someone naked in bright light: You can see all their flaws,” says Lappin. Or, if your home does have furniture, make sure it’s the right furniture for each room.

“If you turned your college kid’s bedroom into an office/workout room, change it back to a bedroom,” says Lappin. “I don’t care if it’s four-bedroom—if you only have a bed in one room, it will be perceived as a one-bedroom house. It may sound weird, but that’s how people think. They may say they have imaginations, but they really don’t. On a subliminal level, they take what they see to heart.”

Tips for Holiday Season House Hunting – SFGate

This time of year typically marks the unofficial time people begin thinking about the holidays. After Halloween, time seems to speed up and before we know it the seasonal frenzy begins. Real estate activity during the holiday season is typically discouraged because of the challenges posed on both sides of a transaction.

For sellers, there is the inconvenience of having to keep the home clean; leaving on a moment’s notice for showings; and limiting holiday entertaining. For buyers, there may be limited access to houses if sellers place showing restrictions due to personal schedules and commitments.

There are other considerations that both sides should keep in mind.

Buyers will find fewer homes on the market, but the homes that are available have motivated
sellers. This may provide a better negotiating climate, and there is less likely to be the type of
competition for homes you see during high season. In turn, sellers will find equally motivated
buyers, and may find that offers and closings move more quickly.

Holiday sellers should table any plans to entertain, have houseguests, or do excessive decorating. Focus on showing off the features of your home that will appeal to a buyer – not your family decorations and holiday traditions.

The good news is, those buying and selling during the holiday season are serious about their real estate agendas. Despite the warnings about the timing, they are committed to getting the transaction done and seasonal notions or other challenges do not deter them.

You’re Ready to Sell Your House. Really? – Courier Journal: Randall On Real Estate

Why are you considering selling? Is it because you know you’re ready, and can visualize yourself in another house? If not, there may be external reasons. You have to decide if those reasons are valid. If there’s no way around it, I’m sorry. That happens sometimes. People sometimes have to move before they are ready, and it is emotional. But just know that you get to take the most important parts of your home with you, no matter what: your family and the memories you’ve made there. The people living inside are what makes a house a home. As hard as it may be to accept now, you will make new memories at a new location, and will take the memories you made in your current home with you wherever you go.

If your home has been on the market a while, could you be the reason your home hasn’t sold yet? If so, are those reasons emotional ones? Would it actually put you out if it sold? Or would it be a relief, an open avenue to new beginnings? Think back on suggestions your Realtor made before listing, and feedback you have received from showings. The items in feedback may not be important to you, but the buyer pointed them out to their Realtor as reasons why they would not buy your house. Obviously, you can’t do much about the floor plan. But if you get multiple mentions of carpet needing to be replaced, then replacing your carpet may be the only thing holding you back. If it’s a suggestion from your Realtor, why haven’t you done it? For example, most people have to de-personalize their homes in order for them to show well. You want the buyers to be able to picture themselves in the house, not you. Above all, that means taking down pictures. If that is tough for you, you may not be ready. 

You might have even done these things partially, but are not 100% committed. Being ready to sell means being willing to make it work. Are you willing to do whatever it takes, within reason, to sell it? Know that, whatever your answer is, it’s ok. But if you are still emotionally invested and not ready to let go of your home, and you don’t HAVE to move, then maybe it’s not quite time to list it