3 Stumbling Blocks of Closing - Part 2

Source: pixabay.com

Appraisals and Inspections

While typically these steps affect the buyers’ side of the deal slightly more, a low appraisal for a seller can be a nightmare. Appraisals and inspections function similarly but are used for different purposes.

What is an appraisal?

An appraisal is typically required by the lending bank to protect themselves by not lending more than the home is worth. They usually hire the person who does the appraisal and could make or break the deal. A home appraisal can cost anywhere from $300-$500 and is typically paid by the buyer upfront, however the cost is typically negotiated in closing, which the seller may give credit towards.

The appraiser visually inspects the home and assesses it’s value. They are looking at location, structural condition, renovations, and recent sales in the area of comparable homes.* Square footage and the number of rooms are typically considered in home comparisons. 

If the home is appraised at a higher value than the sale price, that is certainly a boon for the buyer and automatic equity upon purchase. However, if the appraisal comes in lower, that could throw a monkey wrench in the deal. That means the bank won’t be willing to lend you over the valued amount, forcing the buyer to cover the remaining cost. This can happen particularly in “hot” housing markets where buyers are compelled to make bids against steep competition. There is some recourse in this instance other than walking away. 

A skewed appraisal does not only affect the buyer but the seller as well. Appraisers aren’t perfect and there are many homeowners who act in order to appeal appraisals they feel are inaccurate and unfair. The lending bank typically has a process in place to challenge an appraisal, because unfortunately, this isn’t an uncommon occurrence in a continually fluctuating market. 

Image: Realtor.com

What is an inspection?

Another upfront responsibility of the buyer, while they could theoretically skip this step, it would not be smart to do so. The difference between a home appraiser and a home inspector are many. While an appraiser doesn’t work in favor of the buyer, seller, or even the bank, a home inspector is hired and working in the buyer’s best interest. A home appraiser additionally is not responsible for functions of the home and only does a visual inspection and property comparison.  An inspector will test for radon, asbestos or mold, will consider HVAC, and other home functions such as electrical systems and plumbing.** It is wise for the buyer to be present at the inspection to truly gauge the seriousness of each reported condition.

The whole point of a home inspection is to protect the buyer from purchasing a “lemon.” They may be made aware of problems or replacements to expect in the next few months or years, however, an inspection is not any type of guarantee. 

A seller may also choose to have a home inspection made before listing the property in order to be proactive in addressing any issues. Once a problem is known, it becomes “material fact” and must be disclosed to all future potential buyers.

Many times, if a seller conducts a home inspection, the buyer will want to take a peak without shelling out the cash, or conversely, if a buyer orders an appraisal, the seller wants to see how their property fares.  Either way, the other party may want to see the results of a home inspection or appraisal that they did not pay for. The appraiser or inspector is only liable to the person who paid them. This can often be a point of contention between buyers and sellers. Instead of involving yourself, be sure to work through your trusted Realtor through these potentially tricky steps! 

Resources: Realtor.com | thebalance.com

Stay tuned for Part 3 - Repair Addendum 

Selling? It's all in the details

For those of you getting ready to put your house on the market, there are many DIY things you can that will attract your buyer. Getting rid of clutter, adding a plant to the entryway, and going for neutral colors are all great ways to get the buyer to imagine themselves at home!

Source: pixabay.com

10 Important Details That Are Often Overlooked By Home Sellers
Forbes Real Estate Council | March 7, 2018 | Forbes.com

First impressions are formed in a one-tenth of a second. It is this knee-jerk reaction that helps us formulate whether we like something or not, and it can also make the difference in whether your home sells quickly or not at all. 

Making a good impression with home buyers needs to happen the instant they enter your house, creating interest and a desire to have your home as their own. All too often, sellers forget to take care of the small details that can easily turn a buyer off, ultimately taking longer to sell and often at a reduced price.

Weighing in these important and often overlooked home elements are 10 members of Forbes Real Estate Council. They recommend all home sellers take care of these details before allowing their real estate agent to show their home to a potential buyer:

1. Curb Appeal 

Curb appeal is key. Cleaning up the yard, planting fresh flowers and mulching can go a long way. You want to appeal to the emotions of the buyer. Once you have them hooked, your house will be sold. Cleanliness and appearance are ultra-important. - Timothy VandenToorn, United Properties of West Michigan

2. Minor Touch-Ups

Before you allow your home to be shown, please be sure to touch up anything, including paint, woodwork and small items, especially on the exterior of the home, before they get inside. First impressions are so important, and you need to make sure the little things are taken care of because that's the beginning of the showing. If it starts badly, it's more difficult to get them wanting to buy. - Kevin Taylor, Sand to City Real Estate Team 

3. Welcoming Environment

Don’t forget to make your house look like a home. It’s important to remove the clutter and distracting personal details, but you also want a potential buyer to be able to picture themselves in that house. Bake some cookies before a big day of showings for that lingering cookie smell, or invest in some flameless candles for a cozy ambiance. A welcoming environment is key for first impressions. - Joshua Hunt, TRELORA

4. Clean Closets 


The size of bedroom closets — especially in the master bedroom — can be a make/break moment for a prospective buyer. A neat, organized closet that showcases space and functionality can truly make a difference. - Lisa Fettner, ReferralExchange

 5. The Forgotten Front Door

Many homeowners are accustomed to tidying and cleaning inside the house but many forget about the front door. Given that it's technically "outside," many don't feel it's significant, but the truth is, the front door accumulates a lot of dirt and is frequently what buyers are staring at while they wait for their agent to open the lockbox. Give buyers something pleasant to look at before they enter. - Thomas McCormack, Resources Real Estate

6. Neutral Artwork 

A seller wants buyers to be able to imagine themselves living in their home. But that Velvet Elvis painting you've had since school, that bright orange and green sunburst sculpture over the fireplace you bought on a vacation or that bronze bust of your favorite politician are all no-gos. Store them; bland is best. You don't want to be remembered as "that home with the puke-green yard sculpture." - Kevin Hawkins, WAV Group, Inc.

7. The Smell Test

I cannot tell you how often buyers will reference homes by their scents — and usually not in a good way. Simple fixes for common offenses can usually be found in general, carpet and upholstery cleaning, removing clutter and any/all air fresheners and potpourri, — and in a real pinch, fresh paint on walls. Better to be remembered as the house that smelled of fresh paint. - Beverly Serral, Beverly Serral Signatures 

8. Clean Surroundings

Even before getting to the front door, first impressions start on the road when driving to the property. Keeping the yard trim is one thing, and tidying up the house is another, but if the street or other close properties (such as a vacant lot) are littered with trash, take the time to go out and clean it up. It will make all the difference in the sale. - Kent Clothier, Real Estate Worldwide 

9. Tidy Garage

The garage almost always tells the truth about how the property has been maintained. If it's a complete mess, stuffed full of boxes, furniture and junk, buyers assume the well-staged interior is just a facade. If, on the other hand, the garage is clean and well organized, the buyer assumes that the same level of attention and detail went into maintaining the home. - Joe Boylan, SpringsHomes

10. Appealing Photos And Listing 


Historically, curb appeal was the first impression a potential buyer would encounter. However, with the advent of technology, this is no longer the case. Most buyers will spend time researching your property online before they ever drive up to the physical location. Be sure you have professional photos and that your agent is creating an appealing listing online prior to ever showing the place. - Sarnen Steinbarth, TurboTenant


This article originally appears on Forbes.com

3 Stumbling Blocks of Closing - Part 1

Negotiating Price

You know what the home sold for down the street, but is it really a comparable property?  Negotiating price between the buyer and seller side is not the only area where expertise helps, pricing your home is something your Realtor heavily considers before listing.

What goes into your listing price?

There are actually many factors that go into pricing a home and most experts recommend not relying on just one opinion. Two of the most common methods used are Appraisals and a CMA or Comparative Market Analysis. An appraisal is an estimation by a professional, usually hired by the bank or lender to visually inspect the home to determine it’s value. A CMA is collected research of previously sold homes in your area based on location and similar properties, usually provided by your Realtor to determine a listing price. 

Other factors that determine listing price is inventory. In Richmond, inventory has remained relatively low, so it has been somewhat skewed in favor of the seller. However, even after you and your Realtor determine the listing price, a buyer has the right to negotiate.

Don’t let your emotions get involved

Buying or selling a home is an emotional time for many. Sellers may have an inflated sense of their home’s worth, it is a Realtor's job to set expectations on how to expect a listing price to be received. It is the goal of a top notch Realtor to list your home at a great market value in order to sell without lingering on the market.

Conversely, buyers could think to be a savvy shopper means submitting a low ball offer. This is definitely a risk some buyers are willing to take, but it may put a bad taste in the seller's mouth and sour the deal from the beginning. Another mistake that Realtors see is buyers not willing to make a reasonable concession for a great home just because they don’t like the color of the walls.

Money isn’t everything

Some people value time over money and vice versa. Price is not the only thing negotiable in a closing. Some buyers and sellers will make exceptions if you meet their preferred closing dates!

In any case, handling negotiations in a professional way should be done through your Realtor. While your Realtor is obligated to submit an offer, they can advise on what a fair counteroffer may be.

What neither party wants is a ’No Sale.' 

Stay tuned for Part 2 — Inspections and Appraisals!

Sell Your Home Now! (If you've been thinking about it)

We were so excited to downsize into our new home in Old Town Manchester that we think everyone should do it! But realistically, there are a few reasons why - if you've been thinking about selling, now is a GREAT time to do it. Get ahead of the rush to spring market because the early bird gets the worm!

Here's Why Now Might Be the Perfect Time to Sell Your Home

Rising property values and complicated tax changes are coming together to affect the housing market. Whether you come out a winner will depend on when you act.

Maurie Backman (TMFBookNerd) 
Jan 31, 2018 at 8:02AM

When we think of our greatest monthly expenses, it's not surprising to see housing top the list. And if you're a homeowner, you're likely to see that number increase as your property ages and its maintenance grows all the more cumbersome. In fact, housing costs are such a huge issue that nearly 40 million Americans reportedly can't afford their homes.

So why do they stay? For those who own property, it generally boils down to not wanting to take a loss by selling at a low. And if you were looking to sell over the past 10 years, you ran the risk of doing just that. Once the housing bubble burst in late 2008, home prices took such a serious across-the-board tumble that many owners were stuck between a rock and a hard place: being underwater on their mortgages, yet struggling to keep up with their rising expenses. Thankfully, however, things have slowly but surely improved over the last decade, which means that if you've been looking to unload your property, now might actually be the best time to do it.

Image Source: Getty Images

Why sell now?
Maybe the cost of maintaining your home has gotten out of hand, and you're desperate to downsize. Or perhaps your income situation has changed since you first bought your home (say, you've decided to take a break from the workforce and raise kids), and so you're looking for a more affordable alternative. Either way, if you've been barely keeping up with your housing costs for a while, now's a good time to consider getting out -- especially since home values have risen significantly over the past 10 years.

Zillow reports that the median home value in the country hit $200,700 in July of last year, compared to just $196,600 back in April 2007. In some areas, home prices are up nearly 50% from their mid-recession lows. And a large number of homes have grown to actually exceed their previous peak values. What this means is that if you're looking to sell, now might be the time to do it -- especially since we don't know how changes to the tax code will come to affect home prices in the near future.

Tax reform might come to hurt home prices
Though a number of key homeowner tax breaks still exist under the new laws, certain changes might cause housing prices to decline in the not-so-distant future -- particularly in areas where property values are inflated and real estate taxes are substantial. One thing the new tax laws did was lower the threshold for writing off mortgage interest from $1 million in home loan value to $750,000. Now to be clear, these figures refer to the amount of the loan being signed, not the amount of interest being paid in a given year. But what this means is that anyone who signs a mortgage this year that exceeds $750,000 won't get the same tax benefits as someone who signed one last year. And if buyers are less inclined to purchase pricier homes, it could drive values down.

Second, under the old laws, the state and local tax deduction, or SALT deduction, which also covered property taxes, was unlimited. This meant that homeowners in areas with high property taxes could deduct those bills in full. However, the SALT deduction will be limited to just $10,000 annually from here out, which means homes with higher property tax bills may not hold as much appeal.

One additional change to the tax code is that the interest paid on home equity loans is no longer deductible as it once was. Though this shift is unlikely to have the same impact as the aforementioned changes, it's yet one more benefit of homeownership that's gone away.

What all of this means is that if you've been looking to sell your home, you may want to move on that before potential buyers really grasp the consequences of these serious tax changes. Similarly, if you've been struggling to keep up with your housing costs but previously got a huge tax break in the form of, say, a $15,000 property tax deduction, know that you won't be getting the same deal going forward.


Article originally appears on The Motley Fool.

Duplex for rent in Manchester!

Duplex for rent in Manchester!

This two bedroom, two bathroom apartment has polished concrete floors, stainless steel appliances, granite, and full-size washer and dryer. The first-floor unit is for rent with patio, soon to be fenced in and off street parking. $1350 monthly includes water and trash. New construction on Perry Street -walk to Legend Brewery, Brewers Cafe, and Croakers Spot. Just a mile or two to VCU, MCV with easy access to I95 and I64. Call Randy @ 804-370-2006!

How To Be Prepared at Closing Time

A stack of paperwork can certainly be intimidating, writer Erik J. Martin from Richmond Times-Dispatch gives advice on how to be prepared.

HOW TO BE PREPARED AT THE TABLE

Knowing what to expect from the pile of closing paperwork – and how to be prepared – can make the process go a lot smoother.

 

For starters, plan to have all of your financial ducks in a row well in advance of your closing date, said Jeremy Gulish, a realtor with Keller Williams Towne Square Realty, Morristown, N.J.

 

“With the extensive scrutiny that is now part of mortgage underwriting, I recommend that my clients have everything available to show the underwriter, short of their blood work and urinalysis,” Guilish said.

 

Depending on state and lender requirements, count on bringing the following forms and documents to the closing:

• A driver’s license or state-issued picture ID
• Recent tax returns and pay stubs
• W-2 forms
• The two most recent monthly bank statements of all of your financial accounts
• Proof of additional income (alimony, Social Security, rental income, etc.)
• The purchase and sale agreement and addenda
• A cashier’s check or other “good funds” check for the balance due (the total of which you’ll be notified a day or two prior to closing).

At closing, you’ll be represented by a closer for the lender who will ask you to sign a set of standard federally regulated documents, which you should receive three business days prior to your scheduled closing review with your attorney.

 

You’ll also receive a settlement statement showing details of all charges for completing the purchase. Items like property address, loan and payment amounts, dates and names will need to be reviewed carefully. Plan for a long sit-down; most closings last approximately one hour or longer.

 

“Be prepared to explain any major debits, credit inquiries and financial changes that are reflected in bank accounts,” Gulish said. “It’s also critical that buyers don’t have a career change or major financial debits incurred during the closing process, as their lender may not approve their loan if their financial situation changes.”

Article originally appears in RTD Homes Saturday, September 9, 2017 issue.

A PDF version of this article can be downloaded at Homefields.net

Inaugural Modern Richmond Week!

We are very excited this week about the inaugural Modern Richmond Week homes tour!  We have attended MR events in the past and find it is something that truly fascinates us and that's why we have volunteered to be a part of this great event! There are so many other wonderful tours happening this week and we are lucky to be a part of the Highland Hills Neighborhood Tour - a sold-out event - BUT you can still get a chance to see it by volunteering!

Monday 9/18: ChildSavers
Tuesday 9/19: VCU/ICA Panel (Tickets Required)
Wednesday 9/20: Varina Library Film
Thursday 9/21: Handcraft
Saturday 9/23: Highland Hills Neighborhood Tour (SOLD OUT - Please volunteer to help)
Saturday Evening 9/23: Art Style Design Hosted by Mobelux Reception
Sunday 9/24: Art Style Design Hosted by Mobelux Exhibition
Sunday Evening 9/24: Wrap Party at Flora

Traylor Estates Riverfront Community

We had a great time sharing food and fun at the Traylor Estates' riverfront park this past Saturday!  It is such a great community and was so great to welcome new neighbors!

Traylor Estates is a gorgeous, tree-lined community with approximately 150 homes on private wooded lots.  It's civic and homeowner associations are self-managed, which truly encourages its residents to become involved within the community.

The true gem of this neighborhood is the gated, 2.53 acre riverfront property that is shared by all the members of the community.  With a charcoal grill, picnic areas, and a boat landing, this park is a great place for family and friend gatherings throughout the seasons!

There are currently two listings available in this neighborhood, so if you love being surrounded by nature, with the convenience of nearby shopping and dining, give us a call to see Traylor Estates!

A Gem in Historical Petersburg!

We have an amazing property just listed in Historical Petersburg!  This home is truly unique and is just waiting for the right owner to restore it to its full glory!  The price is right, not to mention all the amazing tax breaks that come along with buying a home like this in the up and coming Petersburg area!  Call to make an appointment today! 

Welcome to the Homefields Advantage!

Welcome to the Spring Real Estate Market!  We have been seeing so much exciting growth in Richmond these past few years.  Named the fourth hottest Real Estate market by Zillow last year, 2017 is already shaping up to break some records of its own!  With low inventory, new construction and home prices are on the rise.  However, mortgage rates remain low while credit availability is increasing. That means now is a great time all around to find your next dream home!  

If you’re thinking about entering the market, Homefields, a Virginia Properties division will gladly offer a Comparative Market Analysis (CMA) on your current property.  Even if now isn’t the right time to sell, a CMA can help any homeowner make the right decision on improvements to enjoy now while increasing the value of your home!

We would like to thank all of those who have helped Homefields grow for their support and referrals!  We pride ourselves in treating every one of our customers like family and invite you to experience the Homefields Advantage!

Visit our new and improved website at Homefields.net

and Like us on Facebook! Facebook.com/HomefieldsAdvantage