Sunday, September 21, 2014

Don't Forget About Inspections

The most frustrating part of the buying or selling is often the inspection period.  What the inspection period provides is an opportunity for the buyer to have a comprehensive inspection on the home that they've offered to purchase to find any defects in the home that may influence the value of the property or the desire for the buyer to purchase the home.  Sellers often forget that the buyer has this right, and buyers don't factor this into the equation nearly enough when searching for a home.  Here is a look at the inspection from the two perspectives:

SELLERS
As a seller, you must always keep in mind that the buyer has the right to an inspection.  Often times sellers get excited about their home being in contract, and then when the inspection time comes up they are taken back or surprised by the findings and the excitement turns to dismay.  The sellers find that they'll need to put $1200 into the home to get it sold and then emotion becomes too much a part of the deal.  My advice to sellers is to always keep this in your mind that inspectors are likely to find something that no longer meets code or something that needed repair.  At the same time, remember that what the buyers request to be repaired or replaced is not final.  This is a negotiation.  You have the right to counter the buyer and/or completely turn down their request.  They can walk away, but it is a negotiation and if you aren't satisfied with their requests, you have the power to say no.

BUYERS
When you search for a home, you shouldn't try to play inspector along the way.  Don't worry about small things, the inspection will catch those.  Find a home that provides the location, layout, and amenities that you want, and trust that the inspection period will provide the details you need to make sure the home is a good investment.  Too often buyers pass judgement on a home that may be perfect for them without considering that the item that influenced that decision is one that would show up as either a non-issue or an item that the seller would repair or replace.

Both parties should always consider that the inspection period is not in place to make sure that the home is perfect.  The general unwritten rule is that items that the buyer requests that the seller repair should only be items that impact the health or safety of the occupants.  There are obviously exceptions to the rule, but it is very important to recognize why the inspection available and to honor that code.  If you view the inspection as an opportunity to ask for all kinds of small things that I call "part of home ownership" you are only destined to have deals go sour.

For more information on inspections or to find an inspector, email me directly at scottmorrison@kw.com 

Take care,
Scott



Saturday, September 13, 2014

Tracking Numbers in Gahanna

September 13th snapshot of the Gahanna real estate market:

For this search I used the search criteria of the property being a single family residence, and the listing must be marked as resting within the limits of Gahanna Jefferson Public Schools.  (note: school district is an optional portion of the MLS, so some Realtors do not report this in the listing)

Activity is from August 1 of this year through September 13:

156 homes currently listed for sale
92 homes currently under contract
76 homes closed during this time period

- Closed sales ranged from $61,000 to $547,000
- Of the 168 homes to close or go into contract during this time, 66 of them were on the market less than 10 days before receiving an offer
- 14 of the 76 closed contracts have closed this month (Sept)
-  Last year during the same time period, 71 homes closed.

Going into average sales prices and other specifics would be misleading because Gahanna is a very hyperlocal area.  Each neighborhood or subdivision needs to be reported separately to gain an accurate idea of what homes are worth in that area.  This fall, I'll be posting neighborhood specific reports to the blog, but if you'd like to obtain a report sooner than later, please email me using the address below.

Take care,
Scott Morrison
scottmorrison@kw.com

From KWRI:

Monday, September 1, 2014

Mortgages: You Can't Just Shop Rate

A common conversation that I inevitably have with buyers begins with them telling me that they are either shopping lenders for the best rate or will be contacting a few different lenders to see where they can get the best rate.  

While low interest rates can be awfully inviting, your financial decisions have to be made on more than factors than just interest rate.  

Here are a few things to consider when searching for the best loan whether you are purchasing or just refinancing... 

1.  You cannot just shop interest rates-  When speaking with a lender make sure that you ask about all of the costs associated with a loan.  A small percentage difference looks enticing when you think about it over a 30 year term, but if that small percentage only saves you $50 a month, it takes a long time to make up for $2500 that you pay for higher closing costs (numbers are only an example, bottom line is to investigate all costs before making a decision).

2.  Have a plan for your stay-  How long will you plan on living in the home?  This is especially important for a refinance.  If it costs you $2000 to refinance your loan, but you'll only save $100 a month... make sure you are going to live in the home a minimum of 20 more months.  Otherwise, the refinance will cost you money in the long run.  

3.  Examine the loan terms-  One thing that often gets lost in the shuffle is the length of the loan.  If you are refinancing a loan that has 20 years left, a lower rate and a lower monthly payment may make sense in the short term.  However, if your loan is refinanced back into a 30 year term, you've just added 10 years of paying interest back into your situation.  The lower monthly payment helps your immediate cash flow, but it likely set you back in terms of paying down the principal.  A good exercise for this is to see use the new loan terms, but calculate how much you'd save if you paid it off in the time frame of the old loan (in this example, 20 years).

Best advice:  Find a lender you trust-  Mortgage are complicated, rely on the experts. Sit down and go through several scenarios with a lender that you trust to help you through the process.  Ask questions that help you see the entire picture, not just the interest rate.  You want to be able to afford the monthly payment, but not at the detriment of your long-term financial health.  

Take care, 
Scott Morrison