Selling

What You Can Do to Get Your House Ready to Sell

April 11, 2020 by Gabrielle

If selling your home is your 2020 goal, let’s get to work preparing your home and setting it up for listing as soon as you’re comfortable. LOTS of homes are being listed even during this COVID-19 slowdown.

If you need to get going on your listing, we’ll take precautions to be as safe as possible for you and any buyer, including quarantine considerations: limited numbers of people in the home, loads of photos and virtual tours, sanitizers, booties,and so on.

If you want to wait until things settle down a bit, this is a perfect time to begin getting your home ready, however. Here are a few tips to help you get started.

Some Highlights:

Believe it or not, there are lots of things you can do to prep your house for a sale without even going to the store.
Your real estate plans don’t have to be completely on hold even while we’ve hit the pause button on other parts of daily life.
Tackling small projects from cleaning the corners you may normally skip to tidying up your yard are easy and necessary wins if you’re thinking of listing your house and making a move.

Economic Slowdown: What the Experts Are Saying

March 23, 2020 by Gabrielle

More and more economists are predicting a recession is imminent as the result of the pullback in the economy caused by COVID-19. According to the National Bureau of Economic Research:

“A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”

Bill McBride, the founder of Calculated Risk, believes we are already in a recession:

“With the sudden economic stop, and with many states shutting down by closing down schools, bars and restaurants…my view is the US economy is now in a recession (started in March 2020), and GDP will decline sharply in Q2. The length of the recession will depend on the course of the pandemic.”

How deep will it go?

No one knows for sure. It depends on how long it takes to beat this virus. Goldman Sachs anticipates we will see a difficult first half of the year, but the economy will recover in the second half (see below):Goldman also projects we’ll have “further strong gains in early 2021.”

This aligns with the projection from Wells Fargo Investment Institute:

“Once the virus infection rate peaks, we expect a recovery to gain momentum into the final quarter of the year and especially into 2021.”

Again, no one knows for sure how long the pandemic will last. The hope is that it will resolve sometime over the next several months. Most agree that when it does, the economy will regain its strength quickly.

*QUARTER 1 DATA FROM GOLDMAN SACHS WAS UPDATED FROM 0% TO -0.2% ON 3/17/20 AFTER THE INITIAL RELEASE.

Bottom Line

This virus is not only impacting the physical health of Americans, but also the financial health of the nation. The sooner we beat it, the sooner our lives will return to normal.

Seller-Paid Closing Costs?

March 18, 2020 by Gabrielle

Buying a home typically takes some cash out-of-pocket. There are a few loan types that require minimal or no down payment, but there are many extra fees and costs required to actually complete a purchase.

From experience, I know that for many buyers closing costs are typically about 2½% to somewhere around 3½%-4% of the purchase price. As an example assuming that the purchase price of a home is $300,000, out-of-pocket costs of actually closing on the sale (in addition to any down payment) might range from about $7,500 to, say, $12,000. Of the total, 1½%-2½% or so are actual loan fees — lender fees, recording fees, processing fees, appraisal fees, etc, — with the remaining 1%-1½% or so made up of prepaid costs such as upfront homeowner insurance, property taxes, homeowner association fees, prepaid interest, and so on.

Purchase Price		$300,000
Loan Fees (1½%)	$4,500
Prepaid Expenses (1%)	$3,000
Total Closing Costs Paid by Buyer		$7,500

So who pays these costs?

One approach often suggested by lenders is that a buyer request the seller foot the bill for all of the costs involved in closing the buyer’s loan.

Depending on the status of the current market or perhaps if a home listing has languished on the market, a seller “might” be willing to pitch in and contribute. However, as is most typical in my greater Pacific Northwest area of quick sales and multiple offers, it’s not realistic to expect a seller to pitch in and help in order to sell their home. That seller is unwilling to reduce the proceeds of their sale (their bottom $$) to pay a portion or all of a buyer’s purchase costs. In the mind of a seller, after all, if a buyer doesn’t have sufficient resources to pay their own way, another buyer will be coming along in the next 10 minutes!

Another strategy is to stack any loan costs on top of the purchase price, with the request that a seller then pay the closing costs out of that increased purchase price. That scenario might look like this:

Purchase Price		$307,500
Loan Fees (1½%)	$4,500
Prepaid Expenses (1%)	$3,000
Total Closing Costs Paid by Seller		$7,500

Note that you must be a bit careful with this type of approach. Not only must you, as the buyer, qualify for a higher loan amount, the actual dollar amount of the closing costs will increase based on the higher price and, perhaps most importantly, the home must also appraise at the higher purchase price. With rapidly escalating prices in my area, adding closing costs to a purchase might be just enough to effect a low appraisal–below that all-inclusive purchase price.

Keep in mind, also, that a seller has their own closing costs to pay, which may include brokerage fees, recording fees, notary, HOA dues, etc, and excise or other taxes. Many of these fees are based on the purchase price and if you’ve added closing costs into the purchase price, the seller must pay fees on that inflated price. You may need to offer a seller a slight bit more to cover their extra expenses.

Obviously, if you can pay your own closing costs as part of your purchase, your offer may be looked upon more favorably by the seller and you may have a greater chance that your offer will be accepted. If you do need assistance, be sure to review all of these factors when obtaining loan approval. I’ve seen many offers fail because a buyer asked a seller to pay closing costs … and I’ve seen transactions fail when appraisals come in low.

Your loan officer should provide you with an estimate of closing costs for your purchase. Your real estate representative should provide you with thoughts an options about how to structure a purchase that includes consideration of closing costs.

Another 568 Homes Sold at 9 AM!

March 6, 2020 by Gabrielle

The Difference an Hour Makes

Some Highlights:

Don’t forget to set your clocks forward this Sunday, March 8 at 2:00 AM PST in observance of Daylight Savings Time
Every hour in the United States, 568 homes are sold and median home values rise by $1.92.
As we “spring forward” this year, let’s get together to see how you can take advantage of every hour in the housing market.

Thinking of Selling?

March 3, 2020 by Gabrielle

Thinking of Selling? Now May Be the Time.

The housing market has started off much stronger this year than it did last year. Lower mortgage interest rates have been a driving factor in that change. The average 30-year rate in 2019, according to Freddie Mac, was 3.94%. Today that rate is closer to 3.5%.

The Census Bureau also just reported the highest homeownership rate since 2014 for people under 35. This is evidence that owning their own home is becoming more important to Millennials as they reach the age where marriage and children are part of their lives.

According to the latest Realtors Confidence Index Survey from the National Association of Realtors (NAR), buyer demand across the country is strong. That’s not the case, however, with seller demand, which remains weak throughout most of the nation. Here’s a breakdown by state:Nationally, demand for housing is high, but supply is extremely low. National Association of Realtors (NAR) also just reported that the actual number of homes currently for sale stands at 1.42 million, which is one of the lowest totals in almost three decades. Additionally, the ratio of homes for sale to the number purchased currently stands at 3.1 months of inventory. In a normal market, that number would be nearly double that at 6.0 months of inventory.

A look at the local picture….

In Pierce and Thurston County the current inventory is 0.6 months. What does this mean? If no new listings were added, the supply of houses for sale would be exhausted in 18 days! Lewis County inventory is at 1.5 months or 45 days. Of course new listings are added each day but not nearly enough to keep up with the demand.

What does this mean for buyers and sellers?

Buyers need to remain patient in the search process. At the same time, buyers must be ready to act immediately once they find the right home.

Sellers may not want to wait until spring to put their houses on the market. With demand so high and supply so low, now is the perfect time to sell your house for the greatest dollar value and the least hassle.

Bottom Line

The real estate market is entering the year like a lion. There’s no indication it will lose that roar, assuming inventory continues to come to market.

4 Critical Facts When Selling Your Manufactured Home

February 15, 2020 by Gabrielle

Selling a manufactured home on land is a bit different than selling a stick-built home. There are a few more inspections and requirements, not to mention finding a lender that will lend!

Here in Western Washington, I’ve had the dubious pleasure of working through a few sticky manufactured home transactions over the last few months. Now, don’t get me wrong — working with the buyers and sellers was truly a pleasure! It’s just that there are so many different steps to be taken that sometimes clients can feel a bit overwhelmed by the whole process; and it’s so necessary to be the knowledgeable hand that helps guide the sale.

With a couple of caveats that every transaction is truly different and that different jurisdictions have slightly different requirements, here are a few starter points.

1. Not every manufactured home qualifies for traditional financing methods – only those built after June 15, 1976. Your home built on May 31, 1976 won’t qualify for traditional financing — you’ll need to appeal to a buyer that has all cash or some source of private funding.

2. Know that in order to get any sort of financing for the purchase of a manufactured home, the home must have gone through a title elimination process. A bit of background – when a manufactured home is purchased, it’s personal property – like a car or boat. Title is maintained by the Department of Licensing just like the title to a car. This is likely a testament to the fact that a manufactured home is towed down the road on its own axles and tires, which are then typically removed when the home is placed on its foundation.

That personal property title must be eliminated and the home married to the real property (the land) on which it sits. Home loans are for real property – not for vehicles.

3. Speaking of Foundations — this gets a bit tricky. Prior to 1996, manufactured homes were often trucked to their site and then set up on a series of concrete blocks. Those blocks often sat on poured or prefab cement slabs. Then tie downs were attached to the underlying steel beams that run the length of the home and subsequently secured to the earth or the cement slabs, or whatever. In our area, which is generally not subject to enormously high winds such as hurricanes, some homes were installed without the tie downs and just sit on the blocks.

Now then – bear with me – FHA and VA loans are often used for manufactured homes. It used to be that conventional funding was a bit more lenient with requirements, but I’ve found lately that conventional and FHA/VA requirements are similar. So here’s the thing. In 1996, HUD (Dept. of Housing and Urban Development) placed a requirement that all manufactured homes on private land must be secured to a “permanent foundation,” which they defined. These permanent foundations are designed to prevent the home from shifting or moving away from their supporting structures.

HUD guidelines state that compliance with the guidelines must be certified for all re-sales.

This means that a homeowner must ensure that the foundation system complies with the guidelines by hiring a licensed professional engineer to examine the current foundation structure and certify, in writing, that the foundation is compliant. If not, the homeowner must have the foundation retrofitted prior to sale.

4. One additional step can also be critical, and yet is so often overlooked by an existing manufactured home homeowner. Prior to adding anything to the exterior structure of the home, such as deck, porch, awning, an extra room, etc., you should have obtained an L&I permit in addition to obtaining the appropriate jurisdictional building permit (if required). That’s right – the Dept. of Labor and Industries must also permit and inspect your addition and certify that it meets the manufactured home standards.

See, manufactured homes are designed to be dismantled from their foundation and pulled down the road. That means all exterior structures surround the house must be self-supporting. For example, that deck must have supports and beams of its own – not merely attached to the home by means of a ledger board.

Similarly, electrical modifications, replacing your hot water heater, adding a wood burning or pellet stove, etc. must be approved by L&I. You’ll likely need proof of the modification. If you did not obtain the L&I permit before altering your home, you may need to obtain an L&I inspection before your home can be sold.

Absolutely your manufactured home can be sold. Paying attention to these 4 Critical Facts when selling your manufactured home can make all the difference in an easy sale!

Carbon Monoxide Detectors Now Required for Home Sales

September 30, 2019 by Gabrielle

Carbon Monoxide Detectors are now required for home sales in Washington state.

In order to sell, or re-sell a home in Washington State, a Seller must now include a carbon monoxide detector in every home. As a Buyer, you’ll want to watch for the presence of the detector. As a Seller, here are the guidelines:

A detector must be placed on each floor of the home
A detector must be placed outside each sleeping area
It doesn’t matter whether or not you have a fuel-burning fireplace in your home
It doesn’t matter whether or not you have an attached garage
It doesn’t matter whether the home is new construction — the law applies to every home

Carbon monoxide detectors are readily available in hardware stores, home centers, super stores such as Fred Meyer and Wal-Mart, and often at Costco and Sams Club. In my own search, I’ve priced them starting from about $35.

If you have any questions about this new requirement, or need additional assistance as you prepare to sell your home, please don’t hesitate to give me a call. As always, I’m delighted to be of help to you in any of your real estate needs.

Why Pet-Friendly Homes Are in High Demand

April 9, 2019 by Gabrielle

One of the many benefits of owning your own home is the freedom to find your ‘furever’ friend. By pointing out the aspects of your home that make it ‘pet-friendly’ in your listing, you’ll attract these buyers, rather than alienating the 68% of American households that have a pet!

If you are one of the many homeowners looking to list your home for sale, how do you stand out to the millions of pet parents searching for their dream home?

Whether a dog person, a cat person, or someone who prefers the company of another pet species, 99% of pet owners say that they consider their animal to be family. When finding a home, 95% of animal owners believe it is important that a housing community allows animals.

A study by the National Association of Realtors (NAR) revealed that there are many aspects of the home buying, selling and owning experience that have been greatly impacted by our love for our pets.

This should come as no surprise, as $72 billion was spent on pets in the U.S in 2018. NAR’s President William E. Brown shed some light on the impact of pet owners and their home search.

“It is important to understand the unique needs and wants of animal owners when it comes to homeownership. REALTORS® understand that when someone buys a home, they are buying it with the needs of their whole family in mind; ask pet owners, and they will enthusiastically agree that their animals are part of their family.”

The Power of Pets When Choosing the Right Home

89% of pet owners say they would not give up their pet due to a housing restriction
81% of Americans say their pets play a role in their housing situation
31% of animal owners have refused to put in an offer on a home because it wasn’t a good fit for their animals
19% of Americans say they would consider moving for their pet
12% percent have moved for their pet

New home builders have actually begun installing retractable pet gates that tuck away neatly inside door jams as a highly requested feature in new homes to attract pet-parents.

So, if you are a homeowner looking to sell in today’s pet-friendly environment, point out the features of your home that will attract pet owners:

Fully fenced in backyard – (91% of pet owners ranked this as the most important feature of a home to accommodate their pet)
Locations of dog parks/walking paths/pet-friendly beaches in the area (71% ranked this as the top feature of any neighborhood they would consider)
Proximity to veterinarians/groomers/pet supply stores (31%)

Bottom Line

Americans love their pets and will look for pet-friendly features in the home they wish to buy, so take advantage of this knowledge by pointing out your home’s ability to meet their needs.

7 Pricing Myths You Need to Get Past If You Want to Sell Your Home

February 11, 2019 by Gabrielle

When homeowners are preparing to put their properties on the market, one aspect is usually foremost in their minds: money. Setting the asking price accurately can mean the difference between getting an offer quickly and having a house languish for months, drawing little interest.

With that in mind, it’s important that potential sellers block out a lot of the noise that often surrounds the intricate art and science of pricing. There are plenty of myths that may cause sellers to lose sleep at night as they attempt to separate fact from fiction.

The following are statements that can stand in the way of a successful sale.