Full Service Real Estate

Considering a fixer? The positive side is that they can be found in any place and any neighborhood demographic. These properties tend to lack care and have received poor maintenance. Their value, regardless of the type of neighborhood, will be drastically lower than similar houses in the area.

Is It Worth It?

To know if it is worth your money and time, do the research. Determine how much it will cost you to bring the value up to its full market value. Is that value within your budget? Then, review how much of your money you will get back. If the cost of the home plus improvements is not what the market value of the home will be, it may not be worth it to you.

When first starting to invest in fixers as real estate property, consider working only with homes that do not need structural repair. This will help you break into the game and learn the process for fixing up a property.

Historical Status

There is a 20% investment tax credit for qualified improvement expenses. The property must be listed on the National Register of Historic Places and/or have the appropriate local and state historic districts. The downside of historical buildings is that significant structure changes and demolition are not allowed deductions.

There are a few different ways to finance property with historical status, and Your Full Service Agent™ can set up a meeting with a mortgage broker, if you are not currently working with one, to explore the financing options for historical properties.

Financing for Fixers

Like with historical properties, there are several financing options available. It is best to speak with a mortgage broker about your options since there are many ways to approach it. Your Full Service Agent™ will take the decision you make about financing and help you find a fixer that fits your criteria.

Building Codes

• A set of rules, called codes, set minimum public-safety standards for every aspect of home building and improvement.
• Be aware that different parts of home improvement and building have different codes and inspection processes to be aware of.
• Some types of remodeling require permits and inspections. Before you begin a project, do the research to make sure you don’t need them. Also, when purchasing a home that has been significantly remodeled, ask for proof of permits before buying the home because you become liable after you purchase the home.

Finding a Contractor

HomeServices is a complimentary program for our clients. It allows you to access a preferred list of vendors who are licensed and bonded for customizing, maintaining, and updating your home. You have access to this program the entire time you live in the home you purchase using Your Full Service Agent™.

Local Real Estate Statistics for May reviewing Pierce, Snohomish, and King Counties.

Local Real Estate Statics for April 2008 for King, Snohomish, and Pierce Counties in Washington State.

Searching for Foreclosures

Foreclosure means that the lender repossessed the property due to owners who failed or could not pay their mortgage for a variety of different reasons. In Seattle, the foreclosure rate is very small, and being so small it is a very niche market.

The research relating to foreclosed properties can be immense, and your real estate agent will be able to assist with the research for liens, undisclosed information, including court judgments, so that work can be done to clear the items and if nothing else, just knowing as much about the property as possible.

• Non-judicial foreclosures are related to defaults on mortgages or deeds of trust. The lender is unable to get a deficiency judgment from a court potentially raising concerns for title insurance companies that could cause the inability to issue a policy.
• Judicial foreclosures are court-supervised sales that cover the cost of the remaining mortgage and any unpaid balance.

Buying Foreclosures

Many avenues exist to find properties in foreclosure. Watch the newspaper legal notice section and postings on the property or in the location where a trustee sale will occur. Trustee sale bids start at the amount of the outstanding loan amount. These properties are sold as-is. This is risky because there is limited knowledge about the condition of the home, and interior inspections are not possible before the sale.

Remember, this is a niche market, and that means there are many experienced real estate buyers in the market. Your Full Service Agent ™ specializing in foreclosed properties will be of value to you, helping you navigate the foreclosure real estate market.

There are some areas to be aware of when looking at foreclosed properties:

• HUD down payments vary based on several criteria including if the property is eligible for FHA insurance. They do require earnest money.
• VA foreclosed properties may be purchased below market value with a small down payment due to their loan guarantees.
• You will be required to pay cash – there is no financing available for this type of real estate purchase. Second best to cash is a line of credit from your bank.

Local Real Estate Statics for March 2008 for King, Snohomish, and Pierce Counties in Washington State.

• Head to the post office and fill out a change of address form. You can also do this online from USPS.com.
• Make a list of all your accounts: bank, credit, subscriptions, newspaper, etc. Start calling the companies or submitting the necessary information online for each of your accounts.
• Create an e-mail or e-card to send to all of your friends and family with your new address and estimated date of arrival in your new home.
• Clean out and prepare any appliances that you are taking with you.
• Know what your homeowner’s insurance will cover during the move. If you are using movers, know what their policy covers.
• Call all of your utilities and have them disconnected at your existing home and connected at your new home.
• If you are using movers, know the weight of everything that will be moved because cost is usually based on weight. Padding is important and excessive padding may add a lot of weight which will up your moving costs.
• Label the moving boxes by room so that you know where things are supposed to go when you arrive, and then you can have the movers place the boxes in the appropriate place. In addition, have a box ready with snacks, toilet paper, paper plates and cups.

Moving Out of Town

• Contact all of your doctors (including veterinarians) and get copies of your records to give to your new physicians.
• Contact your family’s schools and start the transfer of those files to the new schools.
• If you have pets, take into consideration what they will need and how that will affect your route – hotel policies, walking stops, food, etc.
• If you have a safe deposit box, make arrangements to close it and transfer the items within it.
• Plan your route ahead of time and have an emergency contact person who knows where you should be along the way.
• Don’t carry too much cash! Traveler’s checks and ATM/credit cards will work at most places.
• Before you arrive, ask the people you know in your new neighborhood to introduce you to people that they know in the area.

Help Out the New Owners of your Home

• Pull out warranties and owner’s manuals for all appliances that stay with the home.
• Leave a quick list of your favorite services to help them get acquainted with the area. Include dry cleaners, pet sitters, salons, lawn services, etc.
• Put the garage door opener with an extra set of keys on the counter to easily be seen by the new owners.

There are two types of family residences to invest in: single-family homes and condominiums.

Single-Family Homes

A single-family home is a structure that has only one family unit. Sometimes they can have external structures or common areas with separate entrances that offer a rental opportunity. Purchasing a single-family home to rent out, one that you don’t live in, also offers ample opportunity.

Depending on the area, there may be CC&Rs (Covenants, Codes, and Restrictions) that exist to help property owner’s work together to maintain the neighborhood common property and the value of their individual properties.

Condominiums

Condominiums are complexes of homes in a single building. These residences appreciate differently than single-family homes. For urban living, single home buyers, and families who are downsizing after children have moved out, condominiums are a great housing solution.

As investments go, condominiums are fantastic in areas of high growth and where there is limited space. More people want to live closer to work and enjoy the amenities cities have with minimal commute time.

Home Owners’ Associations

Many neighborhoods and condominium complexes have home owners’ associations. These associations are created for the common good of those included in the association. Restrictions and guidelines for these items may be referred to as CC&Rs.

Well managed associations ensure that everyone works together to maintain the properties and their value. While the intent of home owners’ associations are well intended to benefit all, there may be some things you can’t or don’t want to conform to. Make sure before you buy any property that you know and are comfortable with all the rules. One way to find the attitude and general approach to home owner association management is to talk with the President. Part of that conversation is to learn about the culture of the neighborhood or complex and to learn about how the association works, any projects that the association is funding and problems that require attention.

With any neighborhood you consider moving to talk to the people who live there. This also will allow you to get a feel for the culture and know if it s a location where you will be comfortable.

In addition to this active work on your part, Your Full Service Agent™ will be able to pull demographic information about the area for you.

Return on Rentals

Financing for rentals will require an area rent survey that is provided by a certified appraiser. The potential income you can expect to receive monthly by owning a rental property will depend on past rent, location, current housing market, and the condition of the property. To be a prepared rental owner, you need to have a positive cash-flow and reserve funds to handle expenses that occur unexpectedly as well as to cover the cost of maintenance during slower occupancy times. The cash coming in must cover your loan, taxes, insurance, and regular maintenance.

Once your decision to sell is made, there are preparation steps to take that will make your home stand out among the competition. There are three things that come into play when buyers are looking at a home:

1. Location
2. Price
3. Features and Condition

When reading the rest of this article, keep these three things in mind because you need to look at your home as if you were considering buying it to make sure that your home shows well.

Understand the Market

Your Full Service Agent™ will provide you a complete market analysis of your neighborhood showing current market activity. Based on your needs, you need to know specific statistics to ensure that you understand what to expect when your house is on the market – you don’t want any surprises.

In addition, Your Full Service Agent™ will tell you about the current market for the area around your home. Different areas within a city, even just 5 or 10 miles away from your home, can have different market conditions. You will be informed about the overall market conditions as well as the specific area in which you currently live. What happens in real estate markets in other parts of the country may not be what is happening here.

Knowing how Your Full Service Agent™ will market your property and what data they will provide while your home is on the market is instrumental in keeping tabs on the market. Statistics will provide you information to use to make further decisions as needed during the time your home is listed for sale.

Remove Clutter and Clean

Remember when you purchased your home. What did you notice about your home’s layout and features that made you decide to make an offer? These are the items that will help you sell your home now.

Clutter hides in plain sight everywhere: counters, the pantry, closets, bathrooms, cabinets and drawers. When selling your home, minimize as much as possible. This includes furniture and home décor as well. Less can provide a great positive impact on most spaces. If you can’t part with donating or selling the items you determine to remove from your living space while your home is listed for sale, rent a storage unit and remove as much as possible from your home to make it feel open and inviting.

Take the time to clean everything inside – the deeper the clean the more inviting and appealing your home will be to prospective buyers. Scrub corners of the kitchen and bathrooms, move the refrigerator, clean out all appliances, wipe off counters, wash the windows and clean every fixture in your home. Buff and polish floors and clean all window coverings.

Your home’s exterior is the first impression that a prospective buyer will see. Don’t forget to head outside and clean the gutters, driveway, paint, weed the flower beds (if it is off season), trim bushes and trees, bring in some in season plants, clean out garages and sheds, and rake leaves if needed.

Now Look at Your Home

With an uncluttered and clean home, you can take a new look at the house. From the outside of the house, what do you see first? Is that what you want a prospective buyer to see? As you come up the walk, what catches your eye? When you walk in, how does it feel? What do you notice?

From curb appeal to the feeling you get when coming into your home, you want to experience what a prospective buyer will see and feel. Anything that you don’t like at this point, investigate if and how it can be changed and updated.

Updates and Repairs

In addition to the items you would want improved with your potential buyer hat on, there may be things that you need to repair to attract buyers. Anything from grout in the bathrooms to removing dead plants from the yard are included in this step.

Painting walls is a very cost effective way to give your home a face lift. As our client, HomeServices will provide you access to companies that can assist you with painting, repairs, and updates.

Whatever you choose not to update or repair turns into a bargaining chip in the negotiation process when you receive offers.

Show It to Sell It

Your Full Service Agent™ will hold open houses and create a virtual tour of your home. In addition to the open houses and internet information, your home has to be ready to show at a moments notice.

Open blinds and curtains and keep everything put away. Pets that stay at home while you are at work are something that showing agents need to know about. Leave instructions! It is better, if possible, to have your pets out of your home for any showing.