Sunday, August 30, 2015
Dont Fight The Home Inspection
Question: We are selling our house and have just received an offer to purchase. The offer contains a contingency for the buyer to obtain a home inspection report.
The buyer is asking for a general inspection contingency, but our real estate broker is advising us to use the specific inspection contingency. Can you explain the difference and give us some assistance?
Answer: In my opinion, it is imperative for a homebuyer to obtain a home inspection after the contract for sale is signed by all parties. Buyers often purchase real estate based on emotions rather than facts, and a good home inspection is important to satisfy the purchaser that the property is substantially in sound condition.
A buyer should always include in a sales contract a contingency to the effect that the contract is contingent on the purchaser obtaining, at purchasers expense, a satisfactory home inspection within three or five business days after the real estate contract is ratified.
Sellers may think, at first blush, that an inspection is not in their best interests. However, if the seller stops and thinks about it for a moment, it becomes very clear that even from the sellers point of view, it is advisable to let the buyers have a short contingency to back out of the contract if they are not satisfied with the condition of the house.
I would rather have a purchaser back away early in the process than wait until the very last minute and raise all sorts of problems and concerns on the day of settlement.
Of equal importance, if the purchaser has obtained a satisfactory home inspection report, that same purchaser will be hard-pressed to raise issues about the condition of the house on the day of settlement -- or even later. Often, I have heard sellers tell buyers "you removed the home inspection contingency, and if you have a problem with our house, look to your own home inspector."
As you have indicated, there are two basic inspection contingency forms used in the Washington metropolitan area -- both of which are equally applicable for all real estate transactions. The first is known as a general contingency, which gives the buyers the absolute right to back out, if, for any reason whatsoever, they are dissatisfied with the inspection report. In practical terms, however, buyers often tell sellers that the contingency will be removed if the seller makes certain repairs.
The other contingency is known as the "specific contingency," which works likes this: After the buyer has completed the inspection, the buyer must submit a list of items to be repaired or corrected to the seller. The seller has three days to advise the buyer whether they will do any or all of the items on the list. The buyer then has one additional day after receiving the sellers response in which to determine whether to buy the property or to declare the contract null and void.
Obviously, from a buyers point of view, the general contingency is much preferred. Basically, the buyer can walk away from the house for any reason whatsoever. On the other hand, the specific contingency is clearly much better for the seller, since it narrows down the issues, and gives the seller the opportunity to correct certain defects, rather than lose the buyer.
Needless to say, from your point of view as the seller, the specific contingency is in your best interests. However, from a psychological and a marketing point of view, if the buyers are demanding the general contingency, they might be suspect as to why you are insisting on the specific contingency. Keep in mind, your buyer does not know the house at all, and if they feel you are trying to hide something from them, they may become very hesitant to go forward with the purchase of your property.
My own suggestion is to >
You have indicated, however, that there is no time limitation on the contingency. This is not acceptable. If you do not have any time limitation, then the buyer literally can back away from the sale on the date of settlement by producing an inspection report that is unsatisfactory. You should limit the inspection contingency to a period not to exceed three or five days after the sales contract is signed.
You should also insist, however, as a seller, to obtain a copy of the entire inspection report, whether or not the buyer raises any objections based on that report. After all, if the buyer raises problems later at the settlement table -- or even months after taking title, it would be very helpful to have a copy of that report in your possession.
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Importance of HOA Contracts
Each year, thousands of homeowner associations across the country engage in complicated renovation projects that run the gamut from siding replacement to roof overhauls to dryrot repair to new decks and fences. Aside from the complexity of the tasks themselves, all need a carefully crafted construction contract that not only describes the scope of work and price but includes the fine print.
Contractors typically present contracts that address whats most important to them: the money. The scope of work described is usually very general, like "paint buildings". The contract ra>
Similarly, take advantage of other knowledgeable consultants for complex and costly projects. While they arent free, they are generally worth their weight in gold in making sure the work gets done right. They can often steer you to >
Below is a list of contract clauses that should be included. Simply attach them as an addendum to your contractors contract and make them a condition of acceptance. You should have a knowledgeable attorney review the contract as well.Names and business addresses of the parties.Date that the contract is signed.A short narrative that summarizes the agreement. For example, "Nottacare Condominiums is hiring I.M Manly Contractors to remove the old siding and install new siding on Buildings A-D followed by a total repaint of all buildings. see Scope of Work for specifics"Obligations of Each Party: For example, the Contractor agrees to provide the labor and material to complete the scope of work attached in a timely and professional manner. All changes or additions must be approved in writing by the HOA President. The HOA is obligated to pay the Contractor in four progress payments within seven days of billing.Deadline for Performance. This clause usually includes the phrase, "Time is of the essence" to imply that work must be completed barring only unforeseen circumstances like material delay or weather. Working six different jobs at the same time is not a valid excuse for delay.Time Effectivity of the Contract.The Cost of the Work and Materials. This could either be a set price or an hourly labor rate with material at, say, cost plus 10.Payment Schedule. Is it due on completion or in installments?Late Payment Penalties. Can interest be charged?Warranties. These come in two forms, material and labor. Material warranties come from the manufacturer and are subject to proper installation. That means that even though the material warranty is, say, 20 years, improper installation will void the warranty. Labor warranties are offered by the installation contractor and are usually >Terminating the Contract. Define under what condition either or both parties could terminate the contract. Breach of contract can be enforced by either. There should also be a mutual agreement clause to terminate.Arbitration or Dispute Mediation. If there is a problem that cannot be worked out, its usually in both partys interest to have a trained mediator help sort it out rather than engaging dueling lawyers.Paying Attorney Fees. If the matter lands in court, the prevailing party should be entitled to payment of attorney fees and legal costs.
While the fine print seems cumbersome and unnecessary, these clauses ensure either performance or consequences for failure to perform.
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6 Imperative Mistakes to Avoid When Decluttering Your Home
If youre getting ready to move or sell your home, clutter is your worst enemy. It makes packing a nightmare, and finding the one item you need could take an extra 15 minutes to more than an hour. Decluttering is a great way to get rid of the things you dont need before moving or preparing your house for a walkthrough. But you need to avoid some of the common mistakes that come with this seemingly daunting job. Here are some of the roadblocks you could run into and how to handle them:
1 Laziness or procrastination.
If you dont feel like decluttering your house will achieve significant results or make your house feel cleaner, then youre not going to do it effectively. At the same time, if you drag your feet, it may take weeks to get the job done. Have a set goal in mind and stick to it when starting this project, especially if you plan to do the entire house. If you need someone to help or keep you on track, you can hire a home organizer to set a schedule and make the process more manageable.
2 Tackling too much at once.
You cant organize the entire house in a day. Its simply not doable. And it will sound far too overwhelming from the start, deterring you from ever finishing. Spend just a few hours each day decluttering, tackling one room at a time. If thats too much to do, start with one closet or a few drawers and work your way up. Remember, you will always have a bigger mess before you have something more manageable. If you make a mess of your entire house, you may never regain the energy or desire to go back to the project. For more tips on how to organize your home quickly and easily, check out this post from HuffPost Homes.
3 Not having an organization plan.
Once you start pulling items from your closets, drawers and other parts of your room, you need to have an organization plan in place. You dont want to throw everything into one big pile -- that creates another mess to sort through later. Instead, tackle it strategically by putting each item into a dedicated pile: donate, sell or throw away. That way, youll know where it goes and how to handle it once the room is completely decluttered.
4 Letting emotions do the talking.
You may be tempted to keep certain items because of their sentimental worth -- they were a present, belonged to a family member, have old memories attached, etc. -- but oftentimes the pieces we hold onto are of no use. You shouldnt keep pointless items just for emotions sake, unless the emotions are so overwhelming that you simply cant help yourself. Old toys, pieces of clothing, shoes -- these are better off at secondhand stores or in the trash. Yes, there will be pieces of jewelry or photos to keep, but be choosy.
5 Getting rid of things.
Once everything is organized and out of the room, take the next step. Dont let the garbage, donation items or garage sale pieces just sit around. You need to drive them down to the secondhand store or landfill. If you need to sell stuff, arrange a garage sale for the following weekend. Waiting until the opportune moment to finalize your decluttering could lead to more piles, which means more hassle for you.
6 Waiting too long to declutter again.
Once youve decluttered every room -- whether in preparation to move or sell your home -- dont get too >
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Home Sellers Advice: List It or SIY?
|Andrea Davis is the editor for HomeAdvisor, which helps homeowners find home improvement professionals in their area at no charge to ensure the best service in the shortest amount of time.|
There are pros and cons to doing anything yourself. You weigh factors such as your expertise, the enjoyment of doing a certain task, and the cost savings of doing it yourself DIY vs. hiring a professional.
Are for-sale-by-owners successful? The answers may lie in research from the National Association of REALTORS. According to the most recent Profile of Home Buyers and Sellers, the share of home sellers or SIYs who sold their home without the assistance of a real estate agent was only nine percent.
Most SIY sellers dont do anything to market their homes, whereas most real estate professionals advertise listings on multiple listing services and through other means. This could be a real disadvantage for SIY sellers because 92 percent of buyers use the Internet to shop for a home and half use mobile applications on their phones to look at listings.
So where do SIYs get buyers? Not from testing the open market. Forty-four percent of FSBO sellers knew the buyer prior to home purchase, and about 15 percent of SIY sellers were approached directly by buyers.
This results in a lower median selling price for FSBOs than listed homes, 208,700 compared to 235,000. That means the typical listed home -- a home listed professionally with a real estate agent - sells for 13 percent more than a FSBO.
The number one reason why SIY sellers dont want to list their homes is real estate fees which can typically range from five to seven percent of the transaction. But, by not testing their homes in the open market theyre losing more money than the fees.
Significantly, more buyers are using sales professionals to help them find and buy their homes. In 2001, 69 percent of buyers used the services of a real estate professional. By 2011, that number had risen to nine out of 10 and remains true today. So if youre planning to sell your home yourself, you may be dealing with a professional agent instead of the buyer across the table.
As a seller you should realize that buyers have changed. Todays buyers are older, more savvy, and have better credit than in the past. The typical first-time buyer is 31 years of age, while repeat buyers are 53.
They expect to occupy their homes for approximately 12 years, so they plan to buy very carefully. In fact, more than half of buyers said finding the right home was the most difficult part of buying a home. The fact that youre an experienced homeowner may not be as big an advantage as it once would have been.
Last, SIY sellers miss the advantages of having their own agents. When you SIY, you have to do everything the real estate agent would do -- show the home, negotiate, advertise, and keep the transaction moving forward.
Those are just a few things to consider as you decide whether to list it or SIY.
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8 Overrated Interior Design Trends
Trends come and go, and while everyone wants to be on the forefront, with a home that showcases the latest, greatest, hottest and chicest stuff, not all trends are created equal. And not all are meant for everyone.
Get vertigo from busy patterns? Perhaps you want to stay away from that herringbone backsplash. And while were in the kitchen, lets talk about those counters
1. Marble Counters
Those Carrarra marble counters sure look purdy on TV. In real life, they dont look so hot with red wine rings and etched areas where the polish has worn off. Porous marble is notoriously hard to take care of, with staining and scratching a high probability unless your OCD is on constant high alert. A sealer can help, said Houzz, but it wont turn marble into easy-care quartz.
"A sealer wont protect your marble completely, but it will buy you some time if youve left an acidic substance on your surface that wasnt wiped up right away," they said
If you really want the look of marble but with a lower-maintenance material, try the aforementioned quartz. Its non porous, doesnt scratch, and there are versions that can get you close to the look of the real thing.
2. Stainless steel apron-front sinks
Farmhouse sinks continue to grace stylish kitchens, with stainless steel often the material of choice to continue a modern aesthetic. But stainless steel is easily smudged and scratched. If you have kids, dogs, or both, or are simply not looking forward to the care involved in keeping this looking good, perhaps a vertical slab of stainless steel in such a vulnerable spot isnt the right option for you.
Ever helped someone scrape old wallpaper off the walls of their home? Even if youve only seen it on HGTV, you have an idea of how tedious it is. If youre planning to use a particularly bold or graphic print on your walls, take a step back and consider this: Do you want to be the guy on a ladder scraping off inches of wallpaper at a time from this room in a few years when you tire of this pattern you mistakenly covered every inch of this room in?
If the answer is no, perhaps a stencil, peel-and-stick wall covering, or a targeted area instead of a whole room is a better option.
4. Dark wood floors
Yes, they look sleek. But dark wood floors are the black cars of interior design. Ten seconds after youre done cleaning them, they look filthy again. Unless you have a home that self vacuums continuously, you might want to embrace a lighter shade. Might we recommend something that better resembles the color of your backyard dirt?
5. White upholstery
Dog hair. Fruit punch. Cocktail sauce. Muddy backyard. Bronzer. Crayon. Mustard. Those are just the first seven things that came to mind when we thought about what would end up all over our white couch.
There are, apparently, people who love their white upholstery and who will put that giant alabaster sectional right in the middle of the living room or flank their dining room table with six snow-colored captain chairs, and to them, we ask: You dont really let anyone sit there, right?
What is the point of a patio cover? To be covered, right? Unless you can somehow figure out a way to position your face under one of the narrow slats that comprise a pergola, youre not going to get much shade. If you really want some shelter, go for a gazebo or fully roofed patio cover instead.
7. Rain showerhead
While rain showerheads may seem romantic visions of tropical getaways, anyone?, only part of the population believes that. Women dont like rain showerheads, and you want to know why? Our hair. And our face.
That means:The expensive blowout we just got was a huge waste of money;We now have to spend more time blow-drying our hair because it got soaked;Getting ready from here on out will take considerably longer because theres no longer such a thing as a quick rinse;We will emerge from the shower looking like a raccoon and we will need extra time to remedy that situation.
Hundreds of gallons of water pouring down directly on our head is not >
8. Getting rid of the bathtub
Theres a growing trend among bathroom remodelers, many of whom are opting to ditch the bathtub and go with a large walk-in shower if space is an issue. Removing a bathtub when its the only one in the house or on the floor is not recommendedespecially if you have kids or are in a neighborhood filled with young families. It could not only have a negative impact on your life>
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Why Your Gutters Deserve Some TLC
Gutters should be an important consideration when it comes to purchasing a new home because of the expense it can cost you down the line, however, the function of gutters is often overlooked.
Gutters serve two main purposes: to make sure water does not gather on your roof and to make sure water is diverted away from your home. Disregarding the importance of gutters and gutter maintenance can lead to serious and costly damages. See what type of home issues arise when you neglect your gutter system:
Foundation Damage: When water accumulates at the base of your home, it can cause foundation and structural damage that can be serious. As water runs against your foundation for long periods of time, cracks will begin to form and, more seriously, your foundation may begin to crumble. Additionally, your basement will begin to flood as cracks allow water to seep into your home. Foundation issues are not only serious, but costly, as homeowners most likely have to pay thousands of dollars in damage.
Roof Repairs: When gutters are clogged with debris, water has nowhere to go, and it will begin to accumulate on your roof. When neglected long enough, water accumulation can contribute to surface decay and fungi. Traces of algae can weaken the shingles of your roof, causing leaks that range from minor to serious. You may be able to remove algae with an afternoon of low-pressure washing, however, extensive buildup of fungi will most likely require a professional roofing team to clean it. Dismissing clogged gutters may lead to the purchase of a new roof, which can easily cost thousands of dollars.
Mold Growth: Clogged gutters will not only contribute to mold and algae growth on the exterior of your home, but the interior, too As water seeps into the inside of your home, mold can develop, raising health concerns for you and your family. Harmful micro-organisms can cause serious damage and lead to a variety of health symptoms such as throat irritation, nasal congestion, eye complications, coughing, and skin conditions. Mold is difficult to deal with and depending on your situation, a professional may need to take care of it.
Landscape Erosion: Clogged gutters will lead to overflowing water which will land on flower beds, small trees, and shrubs, ruining all of your landscaping efforts. This type of water runoff creates pools and puddles of stagnant water that will attract mosquitoes and other wildlife. Additionally, stagnant water around your foundation will cause your landscape to erode.
Soffit and Fascia Rotting: Your soffits and fascia are the closest part of your home to your gutters. When gutters are clogged, water will collect in your gutters and seep into your soffit and fascia board. With nowhere to go, the water will begin to rot out your fascia and soffit, causing your gutters to pull away from your home and eventually fall.
Guarding your Gutter
Gutter cleaning is still a temporary solution to a recurring problem. As an alternative solution to gutter cleaning, gutter guards are a worthy home investment since they prevent costly damages that are associated with clogged gutters.
It is important to take into consideration that not all gutter guards are created equal. Some gutter covers, like reverse curve gutter guards, feature a large opening on the front side of the gutter. This allows smaller debris to enter and clog your gutters. In fact, homeowners will most likely need to remove a reverse curve gutter guard system in order to clean their gutters twice a year.
Alternatively, a micromesh gutter protection system, like LeafFilter, features small openings that prevents all types of debris like pine needles, seed pods, and helicopters from entering gutters. Additionally, when shopping, it is also important to read gutter guard reviews and understand the companys warranty before installation.
The addition of a gutter protection system can eliminate gutter cleaning from your home maintenance checklist and prevent damages that are caused by clogged gutters.
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Five Ways Bargain-hunting Can Backfire On Home Buyers
|Article contributed by LeafFilter. LeafFilter is a micro mesh gutter guard that attaches to your existing gutters and provides you with clog free gutters for the life of your home.|
Its natural to want to save money when youre making a purchase as large as a home. You want to buy the best home in the best neighborhood at the best price, and you may think the only way to accomplish your goals is to look for bargains. So instead of hiring a real estate agent, you scour the market for FSBOs, short sales, foreclosures, or homes that have been on the Internet too long.
While youre bargain-hunting, here are five things you should keep in mind:
Lowballing sellers doesnt work.
They dont waste time with low-ball offers that they find insulting. Just as you want the home you buy to appreciate in value, sellers purchased their homes as investments, too. They want to net as much as possible, because they took a financial risk and had the foresight to buy the home they chose.
This sense of entitlement -- that homes should only be sold at a profit - may cause them to overprice their homes or be less willing to negotiate. Youll feel the same way when it comes time for you to sell your home, so make your offer reasonably and respectfully. Show the comparables that led you to make the offer. Be open to compromise.
Other buyers are getting professional help.
Ninety percent of buyers use a real estate agent while youre spinning your wheels driving around neighborhoods and calling FSBO sellers who arent home to take your call. Soon, youll notice that the homes youre watching are going under contract with other buyers.
True bargains are rare.
Sometimes a distressed home will impact the prices of the other homes because they typically sell at a discount of 17 percent, according to the National Association of Realtors. The other sellers may discount their homes somewhat, but if theyre not in distress, dont expect them to negotiate as if they are. A bank foreclosure or bank-approved short sale could take months to close.
If a home has been on the market for a long time without a price reduction, theres usually a good reason. You have an unmotivated, unrealistic, or upside-down seller, any of which could waste your time without resulting in a purchase. Move on to a deal that you can actually make.
The home needs work.
Sometimes a home will be marketed "as is," which suggests that it needs a lot of work. Or, a home may be well maintained, but its so out of date it looks like a vintage sit-com set. You could be looking at a money pit.
Are you willing to perform the work or pay someone else to do the work? Before you buy, get a home inspection and then get bids from contractors who can help you bring the home up to todays standards. If the purchase price and repairs come to approximately the same price as an updated home in the same area, then go for it.
Its not a bargain if it doesnt suit your needs.
A home is a good buy only if it suits your familys needs for space, features, comfort, and function. If you buy a home without enough bedrooms or baths, youll pay more in transaction costs to sell the home and buy another thats more suitable. Choose wisely in the first place because it takes time to build equity. Your home should meet your needs for a long time.
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