Residential Real Estate in SW Washington State

Residential Real Estate Services with Passion, Integrity, Knowledge

Don’t Let Your Luck Run Out

by

With rates climbing and the promise of two or three additional federal rate hikes this calendar year, it’s important to be prepared. Even if you don’t feel you’re ready to buy this year, take a look at the infographic below to see what happens to a potential purchase with a rate of 4.8%.What you want to look at is whether you can save enough money fast enough to keep up with both the raise in interest rates and the 1% a month (or more) increase in prices.

As an aside, my favorite loan officer tells me that rates for very well qualified buyers this week was about 4.375%, already higher than this example.

Some Highlights:

  • The “Cost of Waiting to Buy” is defined as the additional funds it would take to buy a home if prices and interest rates were to increase over a period of time.
  • Freddie Mac predicts that interest rates will increase to 4.8% by this time next year, while home prices are predicted to appreciate by 4.8% according to CoreLogic.
  • Waiting until next year to buy could cost you thousands of dollars a year for the life of your mortgage!

Do You Know the Real Cost of Renting vs. Buying?

by

 

Some Highlights:

  • Historically, the choice between renting or buying a home has been a close decision.
  • Looking at the percentage of income needed to rent a median-priced home today (30%), vs. the percentage needed to buy a median-priced home (15%), the choice becomes obvious.
  • Every market is different. Before you renew your lease again, find out if you could use your housing costs to own a home of your own!

The Great News About Rising Prices for Homeowners

by

Recently there has been a lot of talk about home prices and if they are accelerating too quickly. In some areas of the country, seller supply (homes for sale) cannot keep up with the number of buyers out looking for a home, which has caused prices to rise.

The great news about rising prices, however, is that according to CoreLogic’s US Economic Outlook, the average American household gained over $11,000 in equity over the course of the last year, largely due to home value increases.

The map below was created using the same report from CoreLogic and shows the average equity gain per mortgaged home from June 2015 to June 2016 (the latest data available).

The Great News About Rising Prices for Homeowners | Simplifying The Market

 

For those who are worried that we are doomed to repeat 2006 all over again, it is important to note that homeowners are investing their new-found equity in their homes and themselves, not in depreciating assets.

The added equity is helping families put their children through college, invest in starting small businesses, allowing them to pay off their mortgage sooner or move up to the home that will better suit their needs now.

Bottom Line

CoreLogic predicts that home prices will appreciate by another 5% by this time next year. If you are a homeowner looking to take advantage of your home equity by moving up to your dream home, let’s get together to discuss your options!

Mortgage Pre-Approval for Buyers “and” Sellers!

by

Financing Ad
Photo credit: Everyspoon via Flicker

Some time ago, I received a link to a Forbes article that  pretty much debunks what most people think about obtaining mortgage preapproval: “The Mortgage Pre-Approval Con” The article explains how mortgage preapproval works, what information is requested and evaluated by a mortgage officer, and so on. It’s a good article and pretty much says it as it is.

However, one critical fact missing is that most experienced Broker/Agents (that’d be me!) also work with mortgage professionals we trust. That’s because we have experience with them; we know that when they issue a preapproval, they have the level of knowledge and experience to perform. They also meet deadlines — one of the most difficult challenges facing purchases at the moment.

When working with Sellers, I may ask the Buyer presenting an offer to also be preapproved through a lender I trust. Of course that buyer can work with whomever they want … I just want to assure my client, the seller, that by accepting an offer there’s a good chance the sale will actually be completed.

Working with loan officers that have been vetted through experience, minimizes the “con” in mortgage pre-approval! 

For a list of loan officers I trust and work with, visit my Lender Resource page.

15 Things Your Buyer’s Agent Should (Will!!) Do For You

by

My daughter is currently shopping for a house outside of Washington State, where I’m licensed and practice. Although I cautioned her and her husband against making sign calls and suggesting (strongly!) that she work with a Realtor I interviewed on her behalf and recommend, they decided to make a sign call and then moved forward with that agent. And not happily so. When I spoke with her by phone yesterday, her comment to me was

“Oh Mom, the agent just opens the doors. We’re perfectly capable of finding houses on our own and we don’t need any other help.”

Yikes! Now this young lady, of whom I am very proud by the way, has been raised to think for herself. However, she’s also seen me work and, gee I would have thought, understood exactly how much work I really do on behalf of my clients. Needless to say, I was terribly disappointed with her assumption that all I do is “open doors!” For Pete’s Sake!

With that in mind, I set out this morning to create a list of what I typically do for most buyer transactions. Certainly not every buyer requires each item, and certainly these are done with an eye to the specific house, experience of the buyer, and so on. I know there’s more, but this is a good stepping off point.

1.    Find Houses

  • Help you identify areas, neighborhoods, commute options
  • Set up searches that narrow the list of “everything out there” into homes that more precisely fit your requirements
  • Keep an ear to the ground, coupled with hard research, to find homes that are just coming on the market, price reductions, those that have offers that may not have been reported in the MLS, and so on
  • Help you narrow down your choices
  • What about For Sale By Owner properties?

2.    Open Doors

  • Yes, there’s that elusive MLS keybox. And for that, you need me.
  • Help you assess any/every house you see with regard to its condition
  • Help you assess any/every house you see with regard to how it may fit your lifestyle / needs
  • Evaluate the Competition — research and assess your “choice” with regard to asking price, condition, availability, and issues

3.    Financing

  • Recommend proven lenders
  • Review and help you understand your Good Faith Estimate (GFE)
  • Review and help you understand your HUD Statement
  • Keep you up-to-date on financing options
  • Help you understand/evaluate those you’ve been offered; i.e., does FHA make more sense than Conventional loans … or how about a USDA option, etc.?
  • Help you understand how your financing choices may affect a home you are considering

4.    Write Your Offer

  • Believe it or not, there’s a lot of legal knowledge that goes behind writing a strong and safe offer for you … and a bit of an art, too. After all, what if you need to back out? Is your earnest money protected, or did you just give it away? And heavens, what if you change your mind?
  • Help you put together an offer that’s as strong as possible, identifying any strengths and/or sticking points and presenting them in the offer in the most favorable way.
  • What if the house is in a distressed situation? What if it’s a Short Sale? What if it’s Bank Owned?
  • Be sure your paperwork is complete and top notch at every step

5.    Open Escrow

  • Help you understand forms that escrow may send to you
  • Stay on top of the escrow process to be sure your everything is complete so that your home purchase will close on time

6.    Legal Documents

  • Be sure that you have copies of all legal paperwork regarding your home
  • Be sure that you have a complete copy of the title report
  • Read the title report with you to identify any tricky spots
  • Be sure that you have a copy of and have read and understand any CC&Rs
  • Be sure that you have access to and have read homeowner association documents, including minutes from meetings that might identify future issues with your purchase

7.    Recommend other proven professionals:

  • Inspectors
  • Roofers, electricians, painters, plumbers, landscapers, etc.
  • Attorneys, accountants, tax professionals
  • Testing services for wells, septics

8.    Help you identify, locate, and understand specific jurisdictional requirements

  • County septics, wells, etc.
  • Setbacks
  • Permits, etc.

9.    Be your representative

  • Present and negotiate on your behalf in a positive and professional manner
  • Present you in the best possible light
  • Be there for you at every event: all showings, inspections, repair trips, signings, builder meetings, septic inspections, well inspections, etc.

10.    Be the intermediary between yourself … and everyone else! (The listing agent, the seller, title reps, escrow officers, etc.)

  • Clarify and draft responses to all communications, being sure that each item is presented in a clear, precise, concise and professional manner
  • Schedule appointments to meet everyone’s schedules
  • Field endless phone calls and e-mail messages regarding the transaction

11.    Counsel

  • Help you remain objective throughout the homebuyer process
  • Appreciate your excitement and enthusiasm for the house you find … and help you evaluate that choice as a business decision
  • Offer suggestions when faced with difficult or complex decisions
  • Act as your sounding board when things just aren’t going smoothly

12.    Offer skillful & professional guidance

  • Suggest research you may want to undertake — what is the permit process, what about wetlands, property corners, schools, bus routes, etc.
  • Help you identify issues that could cause difficulty down the road, i.e., “lawsuits waiting to happen”

13.    Communicate, communicate, communicate

  • Do you know what’s going on?
  • Do you know when answers are due?
  • Do you know your deadlines?
  • Did you get it done?

14.    Be there for you after the purchase

  • Answer questions
  • Suggest solutions (how do I adjust the hot tub? — or … I love this one … “The alarm keeps going off, could you please call the Seller and see if this is normal?”)

and finally …

15.   Get it done!

  • Things fall apart at the most inopportune moments. We’re here to be sure your transaction stays on track and to help when things go sideways!

 

You Can Test Drive a Car … But Not a House!

by

The last couple of weekends have included a few hours helping our son decide what car to buy. We’ve been to this dealer and that, had him prequalified … and have driven a number of cars, usually with the all-chatty salesman in the backseat telling us exactly why this car is THE one to buy. We’ve driven some brand new cars and are now taking a look at a few that a just a couple of years old (Mom insisting that maybe the payment will be a bit easier on his monthly budget.)

Now that we’ve graduated to the used car market, I’ve been busy reading CarFax reports, looking over my son’s shoulder and hanging onto the passenger “Lord Help Me!” strap conveniently located just above most of the passenger windows. (Word to the wise … don’t ever go on a test drive with a 21-year old male …. )

Now that I’m safely home, I’ve been able to reflect on the disparity between buying a car and buying a house. We’re out driving around in a $18,000 car, testing the brakes, going around corners, up steep hills, accelerating on the freeway–all with a eye on making sure that the vehicle seems safe, feels good, and is worth going to the step of taking it to our trusted mechanic before going down the buying path.

However, buying a house … many times more expensive, doesn’t include that same test drive. There’s no chance to sit in the house long enough to decide if it’s drafty, cook a meal in the kitchen and see if the layout really truly works or pack the closets to see if the clothes all fit. All of those things are a bit subjective. We think it’ll work. We walk through the house–maybe a few times–then begin the purchase process. With careful thought and due diligence, we hire a trusted inspector to test and prod the house to reveal its strengths and weaknesses. We measure the rooms, sometimes draw them out on paper and hope everything fits.

But test drive? Nope. That’s reserved for much smaller purchases … like cars, trucks, and RVs.

As Agents/Brokers, it’s important to provide as many opportunities for our Buyer clients to look at a house at their own pace. To figuratively kick the tires, lay on the floor of the empty bedroom to see if the bed fits and stand in the pantry to evaluate the food storage. Because buying a home is truly the largest purchase they’ll ever make. It’s the best we can do .. their test drive begins the day they move in.

*photo courtesy of egg on stilts via Flickr

A Great Lender Helps From Start to Finish, Especially in a Short Sale

by

business meeting

One of the very first steps in the home buying process is determining how a Buyer will pay for their new home. Not only must a Buyer determine much they can afford, but how an offer must be structured–whether closing costs must be paid by a Seller, gift funds will be used for a down payment, how much of a down payment will be paid, and so on.

Having a great lender as part of the Buying team is critical, but especially so with short sale purchases.

It can be difficult for a lender to help a Buyer determine exactly how much they might need to close the sale. A good faith estimate on the front end of a short sale might not be appropriate; interest rates, dates of closing, and other terms may change before lender approval occurs several months later.

Will the Buyer have sufficient funds to close? Will they have sufficient reserves; will they be comfortable with their payment?

A GREAT lender prepares an estimate of costs at the beginning, then meets periodically with the Buyer throughout the process, updating them on the changes and making sure they understand the numbers. They help the transaction succeed – from start to finish.

Working with an agent experienced in both listing and assisting buyers with short sales … and considering their recommendations for a great short sale lender will ensure success and confidence as a buyer proceeds through the process.

Questions to Ask a Loan Officer

by

Photo thanks to Scott Macleod Liddle via Flicker

From my own practice, I know that Buyers often believe that they have the knowledge to make an informed choice in choose a loan officer or mortgage. Buyers are smart folks — they’ve done their homework; they’ve formed a relationship with their own bank; they feel that they can compare apples-to-apples when shopping for a mortgage.

In addition to comparing rates and costs, however, Buyers need to also ask these important questions of a mortgage professional:

  • Can you really close this purchase?
  • Will you provide the loan documents to escrow 2-3 days ahead of the closing date so that my purchase can close on time?
  • What is the minimum number of days you need to close this on time?
  • Will you call me back within a hour (or so) when I have a question?
  • Will you be in close contact with my Broker/Agent so that she knows what’s going on?
  • Will you explain the numbers to me that I don’t understand?
  • How many new purchase mortgages have you completed in the last year? What types? (i.e., do you have experience with VA loans, FHA, rehab loans, etc)
  • Will you meet or beat the builder’s preferred lender’s rates or current offer?
  • If you’re not a bank, to whom do you anticipate that your company typically sell my mortgage?
  • Will you be my trusted advisor, not just for this purchase, but going forward from here so that I know when it might be wise to consider refinancing? (or whatever)

See, it’s not just about rates and closing costs. It’s about making a wise decision based on the knowledge of your loan officer. I have a short list of trusted mortgage folks with whom I’ve worked for years! It’s a short list, because it’s very hard to find excellent loan officers! Both of these mortgage professionals do what they say, when they say, with the terms they say. They stay in touch with me so I can be of service to you. They stay in touch with you so you know what’s going on. Click here to visit the page that contains the names of these two ladies.

There are only two names on the list at the moment because I’m very picky. These two are consistent, and they’re always there for my clients and for me. I like that … It’s all about trust.

Part II–New Construction In and Around Auburn, WA

by

This post was originally published in March of 2012! I’ve recycled the post as there is still significant new construction in and around Auburn, WA, although many of these subdivisions are now completed. However, each of these builders continues to build homes locally and should be considered when buying new construction!

framing10In Part I of this post, I reviewed new construction and communities by DR Horton, Soundbuilt Homes, Schneider Family Homes, and Conner Homes. Because new construction is such a huge part of our south King County and north Pierce County Auburn location, I’ve split my quick overview into two posts.

In addition, you’ll find a few more tips about buying new construction in the post 20 Tips to Buying New Construction.

Premier Homes

hammerI haven’t had a chance to work with any of the Premier Homes folks yet, but wanted to include them in this list as they have a nice community (Northlake) just barely southeast of Lakeland Hills in the Pierce County side of Auburn. At the same location, Lennar Corporation recently acquired the remaining home sites at Northlake and is now building them as Woodland Meadows. I’ve toured a couple of new construction Premier Homes over the last few weeks and they are beautifully finished and a good option for someone shopping in the upper $200’s. A quick drive through the neighborhood last weekend showed lots of activity on the Lennar home sites!

Polygon Homes

hammerPolygon’s home plans have long been some of my very favorites. They’re wonderful folks to work with too! In addition, the Polygon builder team has one of the best home warranties, supporting their homes door-to-door for 3 years (with an optional 2 additional years at the Buyer’s cost), with a total of 10 years for the home structure. Coho Creek in the Covington area (just behind Kentwood High School) has homes available from the mid $200’s up to the low $300’s ranging from about 1,700-2,500 square feet.

Near the south edge of Auburn in Bonney Lake, you’ll find The Estates at Lakeland Hills with slightly larger homes ranging from the higher $200’s up into the mid- $300’s. There aren’t too many of these homesites left, however; The Estates is just about sold-out!

Richmond American

hammerRichmond American recently purchased SDC Homes and appears to be continuing with many of the original SDC home plans and finishes. In addition, Pinnacle Estates is a gorgeous Richmond American community in the Lakeland area of Auburn—BIG beautiful homes with awesome views that sit up high on the east and southern ridge of the area. Note that Richmond American, in my opinion, probably builds some of the biggest homes for the money that I’ve seen, along with their signature art niche’s in the entry halls of most of their homes. Really attractive!

Henley USA (MainVue Homes)

hammerMainVue developments are springing up all over the place. Their newest development on the east hill, Kendall Ridge, is a gorgeous site – incredible views of the Cascade Foothills and Mount Rainier are available from the sites that site on the Ridge. (As an aside, the photo that comprises the banner of my Web site was taken from this development a couple of years ago – when there was just dirt!)

The MainVue floor plans are unique, gorgeous, and truly a breath of fresh air with huge glass doors framing their outdoor rooms (covered patios). Prices are a bit higher than some of the other builders, but with their less common floor plans, appear to be attracting quite a few avid followers. Expect prices to be in the mid $300’s to mid-$400’s at most MainVue communities.

Edgeview

hammerWhen driving anywhere near Lakeland Hills, it would be hard to miss the many bright red signs pointing to the new Edgeview Homes community on the far east side of the area …just off of of Evergreen Way and Kersey Way. Edgeview is built high up a on ridge, and comprises probably a couple hundred home sites, community parks, playgrounds and even an off-leash dog park (yay!!). The largest home plan in the community is just over 2400 square feet, and most of the home sites are somewhat on the smaller side – maybe not important when all of the parks and playgrounds are factored in. Prices range from the low $200’s to mid/upper $200’s.

Covington Pointe

hammerI haven’t had a chance to visit Covington Pointe, but really need to! This is a rare 55+ community, located conveniently near the Multicare Center just off of 180th. The community is gated and features gorgeous one-level homes (no stairs!). I’ve included it here because I haven’t seen any new 55+ communities for quite some time.

Kendall Homes

hammerJust outside of the Auburn area are three communities being built by Kendall Homes. I wanted to include them in this list, however, as I did just assist a buyer in their purchase of a new Kendall Homes house … and it was a great experience! Of note, especially, was the willingness of the folks at Kendall Homes to make some slight modifications for my client. They removed a wall, repositioned a door, modified a shower enclosure, and, outside of the contract, allowed him to purchase his range and have it installed just in time to satisfy the final appraisal and inspection. For communities in the area, visit Mountain View in Maple Valley (just off Witte Road), and 132nd Court and Vermilion.

Quadrant Homes

hammerUnfortunately, there aren’t any Quadrant communities currently being built in Auburn that I can see. I’ve really been a fan of their new Revolution series; an update to their offerings that was long overdue in our area. There are a couple of small Quadrant communities in nearby Kent, along with a few homes here and there in other locations. Be sure to ask about their new homes when you talk with your agent. I think you’ll be impressed!

Part I — New Construction In and Around Auburn WA

Should You Refinance Your Home?

by

If you feel you have sufficient income to continue making payments on your home, but need to lower the payments, one of the best choices — providing current interest rates are justifiably less than your existing rate —  is to refinance the home.

By refinancing, you may be able to remain with your existing lender, or perhaps take advantage of better terms offered by another.

In addition to examining the current interest rates, the next question a homeowner must face when pursuing a refinancing option surround the property itself: Is the value of the property sufficient to support a new, replacement loan? Remember that an appraisal for the property will be done by your lender and must reflect that the loan amount sought is no more than the current guideline for lending. In a conventional loan, that generally means that the loan can be for no more than about 95% of the appraisal amount, based on your particular loan. At the moment, FHA will loan up to 96.5% of the home’s value.

Finally, you must determine whether your current credit position will support a new, replacement, loan. If you’ve fallen behind in your payments on your mortgage or perhaps on other debts, it may be difficult to qualify for a refinance mortgage.

 

 

The information presented on this Site should not be construed as legal or financial advice. You are advised to seek consultation with a qualified Attorney and Accountant. ©Gabrielle Nemes, 2010