Preping Yourself and Your Home for the Market

 

How many have recently attended an open house? Was it enjoyable?...almost like taking a trip to a home show eh..although less grand, way less crowded and less commercialized. When it comes time for you to sell your home, will you be mentally prepared? Many of you will default or defer to your real estate agent to conduct such matters...which is fine but what happens when reality sets in? Here are a few ways to prepare yourself :

• Expect a flood of visitors
• Expect high traffic for the first two weeks: phone calls, showings, agent previewing, last minute showings
• Expect that you'll have strangers in your home, invading your privacy
• Expect to understand that your security can become compromised
• Expect honest and frank feedback, it's business...don't take it personally, you were once buyers and possibly will be again
• Expect to be emotionally detach from your house...so you can see the big picture and avoid regrets.

For those who value privacy and personal space the experience of having strangers come in your home can be rather shocking but it is obvious why you placed your house on the market, right?...To get it sold. If your house isn't easily accessible, i.e. restrictive showing hours, it will not reach its potential dollar value and if you choose not have interior photos, you can guarantee you'll have less showing and potentially less profit.

 

Sometimes, especially when the property is new on the market, open houses can invite a crowd of visitors...where one sales agent alone isn't able to supervise everyone and security measures can become difficult. You, as homeowners, can do a few things to help secure your homes for open houses and while it is on the market:

 

1. Secure your home

• put away personal items: photos
• put away valuables: collectibles, jewelry, money
• if you have an alarm, use it
• secure your beloved pets in a safe location or remove them to a safe location
• put away confidential documents, i.e. credit cards, checks, bank statements, etc.
• put away your prescription drugs

2. Remove undesirable or fowl smells: i.e. strong cooking smells

3. Open the curtains, let in natural lighting and provide ample lighting

4. De-clutter: i.e. halls ways, rooms, closets, etc.

5. Soothing background music

6. Stage your home yourself or hire a professional stager

 

Staging Tips

Deodorizing Tips

Got the Tax Credit, What now?

Mind you, obviously, I am not a tax accountant or a lawyer...a relatively frequently asked question among first time homebuyers is: Now that I've gotten my homebuyer tax credit when can I file it, for what year, with what forms,and with what proof of purchase?

Well, as I am not an accountant I certainly will defer you to some helpful site to shed some light...costing you nothing except for a few clicks and ask that you strive to perform your due diligence to become well informed and take accountability for those decisions....Annnd ask that you would defer to the experts for further clarification, i.e. lawyers, accountants and the works.

Extended tax credit beneficiaries are those who close between November 7, 2009 and April 30, 2010 or have mutual agreement agreed offer by April 30, 2010 and closed by June 1, 2010.  You need to determine to which tax year you would like to take advantage of the said tax credit on or before April 15, 2010 or 2009 tax return or file tax credit on or before April 15, 2011 for 2010 tax return.  You can claim 2009 buyer tax credit even when the purchase was completed/closed after December 31, 2009 OR file an amended return after April 15, 2010.

What documents do you need?  Hmm...you need a proof of purchase, YOUR proof of purchase.  Well, this becomes unclear as to what particular purchase and sale documents are necessary to provide proof.  But in short the following are a necessity:

1. Tax Form 5405 - to help determine the amount you qualify for
2. Apply the tax credit when you file your 2009 or 2010 tax return, which ever you choose
3. And attach documentation of purchase, the details of which have not been released.  You may wish to consult with a trustworthy and qualified tax accountant.

Homebuyer Tax Credit - Summary Chart  (slow load...so have patience)
Frequently Asked Homebuyer Tax Credit Questions
Tax Credit towards FHA downpayment - Limited States

A Presale Buyer's Guide, Avoid the Heartache by Knowing What to Expect

How many of you know what a presale is?  A presale is an empty lot, with the intent to have a house built on it, usually with a pre-determined floor plan; however, if the builder has not pre-determined a floor plan, the buyer is given the option to pick among a select few, limited by the size the lot can accommodate.  In summary this is what typically happens after both parties have come to an agreement in price and terms:

1) Buyer picks lot location
     a) which sometimes may or may not include an option to reserve, usually $5,000-$10,000 to reserve. This amount is usually counted towards the buyer’s home purchase if they were to follow through. However, if they did not, in the past...most recent past, some builders required buyers to forfeit their “reserve” deposit if they chose not to follow through. Don’t confuse this with the earnest money deposit.

2) Buyer picks floor plan option, if the choice is available

3) Buyer picks upgrade options, some options must be prepaid in advance whether it is due to permit requirements, ordering parts, or construction stage requirements; builder wants advance payment.
     a) Some upgrade options may require buyer to make payment to a third party like a flooring company
     b) The true customize home builders provide limitless buyer upgrade options

4) Buyer to wait patiently while builder shuffle paperwork, deal with the city and county, their contractor, their subcontractors, their field experts, their ordered parts and while waiting eagerly…watching for their home to rise from the ground up.
     a) Buyers are not encouraged to be at the building site while work is being done: avoids liability, interference and miscommunication. However they are allow to see it from a distance.

5) Schedule final walk through with builder/managing supervisor/attending supervisor to glean over any mistakes, mishaps and to have them corrected; the list of items to correct is called a “punch list”. I call it the blue tape list because they use blue tape to note areas the buyer sees as concerns.  A copy of the walk through list should also be provided.

6) Schedule a home inspector to come the same time or earlier that day to thoroughly inspect the house so it can be part of this “punch list”. Schedule for a re-inspection of the work done, it would be a good idea to address this request somewhere in the presale purchase and sale. Important to note, it is always best to have as much of the punch list completed, as some builders are known to not follow through after the house closes, even when promised. Can you force them to complete it? Yes, it requires your time, attentiveness and follow through with third parties who could help:
     a) City/county inspectors (i.e. where applicable)
     b) The listing broker’s office
     c) Write and petition the builder under the one year builder’s warranty. It is important that you address your concerns within that one year period and it is important that you keep good and thorough documentation in all communications sent (if in letter form have it certified). Keep tract who you’ve spoken with, details of the conversations, date and time. If the builder has offered another warranty on top of their one year builder’s warranty, like a 6yr warranty or a 2-10 Warranty, the buyer can, after due diligence in seeking recompense from their builder and have gotten no response, they can file a claim against the additional warranty to have those problems resolved. How they (the additional warranty folks) will take care of it will be a matter between them and the builder who has membership with them.
     d) File a complaint with the Department of Licensing, under Labor and Industry department
     e) File a complaint with the real estate licensing department if they have a real estate license
     f) File a complaint with the contractor licensing department
     g) The buyer can stop escrow from closing after signing, to force the builder to compete the project. However, seek the advice of your real estate professional as it will depend on the outline of the contract and how it may or may not jeopardize your earnest money deposit.


Oh yes, one more thing...especially if you are new to the area request utility contact information from the builder and/or escrow before closing and confirm with those companies that all  the utility billing information has been updated to reflect your correct billing address. So, to end in a more positive note, presale is fantasticaly economical with customizable options even to meet the most finicky buyers with limitless imagination, eager to watch their dream home come to life.

Closing Costs, What you should expect.

Closing Costs seems like this big enourmous intangible bottomless pit that no one seems to know until  near the very end of a transaction or  at the least one can feel its looming shadow....

What can you expect from your closings costs?

Buyer's Typical Closing Costs, these fees (subject to any contractural agreement between the parties involved) are independent of loan downpayment(s).

• One half of escrow fee
• Lender's ALTA Extended Title Insurance Premium
• Document preparation
• Pro-rated fees: real estate tax, Homeowners Due (HOA), some utilities
• Reconveyance & recording fees
• Homeowners/Hazard Insurance premium for the first year
• Inspection Fees
• Loan charges
• Other miscellaneous fee: courier,

Seller's Typical Closing Costs
(subject to any contractural agreement between the parties involved)

• Work orders, if applicable
• One half of Escrow Fee
• Title Insurance Premium
• Homeowners Due (HOA)
• Real Estate Fee
• Home Warranty
• Assessment, or bonds
• Loan payoff amount and fees, i.e. prepayment penalty if any 
• Liens, if any
• Recording charges
• Excise Tax (King & Pierce County is 1.78%) plus applicable sales tax