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January 19, 2019April 22, 2019

Winter home sale prep

winter home prep — Winter home prep (infographic from cdc.gov)

The winter holidays are over, so there shouldn’t be any more disruption to your winter home sale, right? A winter home sale may not have much competition during the winter months, but the weather could potentially put a stopper on buyer visits. And in the aftermath of this week’s snow storm, you might have second thoughts about your winter home sale. But since you’re one of the savvy home sellers, you know that weather is fleeting and winter home buyers are serious. You know to focus on the winter home sale prep.

Selling during the winter is not much different than selling during any other time of year. In other words, home sale prep is required. And just as you would during the summer, you should prepare for home buyers to visit your home during a winter home sale. Instead of the heat and thunderstorms of summer, you should prepare for the cold and snow of winter. Your home should be warm enough to make visitors comfortable to help them envision living in your home. Also, consider having a large mat in the entrance where visitors can wipe their shoes or remove them, so as to help keep your home clean.

Decluttering and maintaining a clutter-free home during a home sale is a challenge. But during the winter, when we tend to retreat inside and “nest,” maintaining a home ready to view can be a test of your will. Give yourself more time for home sale prep before a home buyer comes knocking. Consider a daily quick onceover through the house to help maintain order. Limiting buyer visits to specific times of day can help you feel in control, as well as designate a daily private time when you can relax.

Weather permitting, winter open houses are still appealing for home buyers. And during the winter when there are few homes listed for sale, there are even fewer open houses making your open house a destination. Summer or Winter, an open house is an ideal way to have many home buyers visit your home in a concentrated time period. You should coordinate visiting times and open houses with your agent to eliminate surprises.

Regardless of how well you care for your home, maintenance issues are always a concern during a home sale. More so during the winter. If your HVAC system is not working efficiently, it may not be heating your home evenly and consistently. Aging shingles can cause of ice dams, and allow water penetration into the home. Blocked gutters and downspouts can cause safety issues by causing standing water and ice on walkways. Poorly insulated doors and windows cause drafts and cold spots in the home.

Prepare your home for a winter sale and address maintenance issues before the house goes on the market. Have your HVAC system serviced and cleaned. Have a licensed roofer check your roof for missing or damaged shingles. Consider having a pre-listing home inspection to spot concerns.

Recent inventory shortages and buyer demand has made winter a great time to sell your home. However, some home buyers still believe that they can lowball a winter home sale. And there is a good chance that you will a receive a lowball offer. You prepare for these buyers by strategizing with your agent on negotiating tactics. If you receive a lowball offer, don’t get offended. Instead, take the opportunity to start a dialogue with the buyer. If the home buyer is serious, they will negotiate in good faith.

Original published at https://dankrell.com/blog/2019/01/19/winter-home-sale-prep

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

January 12, 2019July 23, 2019

Occam’s razor home selling

Occam's razor and selling a home — Staging is one of the four basics of home selling. (infographic from nar.realtor)

Many home owners are preparing to sell their homes this year. And in doing so, home sellers are looking for new and exciting ways to sell their homes fast and for top dollar. But the reality is that selling a home is not rocket science. There really isn’t a secret trick or approach to selling a home. Rather, it’s more like magic, where properly performed fundamental tasks can set the stage for a satisfying experience. If you don’t know how Occam’s razor (or what it is) can help you get the most from your home sale, pay close attention.

Unfortunately, it’s a human trait seek a complex solution to a simple question. In other words, applying Occam’s razer to your home sale can save you time and allow you to get out of your own way. Occam’s razer is a tool that is often used to figure out solutions and devise scientific theories. It has become popularized as the “keep it simple stupid” method. However, Susan Borowski’s history and explanation of Occam’s razor, written for the American Association for the Advancement of Science, gives it teeth (The Origin and Popular Use of Occam’s Razor; aaas.org; June 12, 2012). Borowski states, “Occam’s razor doesn’t necessarily go with the simplest theory, whether it’s right or wrong; it is not an example of simplicity for simplicity’s sake. It merely tries to cut through the clutter to find the best theory based on the best scientific principles and knowledge at the time.”

In other words, focus on the tried and true fundamentals of selling a home. Anything above and beyond may not necessarily help to sell the home faster or for more money, but could help make the process more enjoyable. That in mind, let’s consider these four basic concepts:

First, consider the condition of your home. Do you have deferred maintenance issues? Does your home need a makeover? Homes that get top dollar are “turnkey.” Many home buyers are willing to compete and pay more for recently upgraded and renovated homes. Selling a home with deferred maintenance or lacking recent updates can not only turn off many home buyers, but can encourage low-ball offers. A pre-listing home inspection can help you identify maintenance issues. Also, consider consulting with a design professional to help you understand which updates (if any) are necessary to help your home sale.

Next, work on the home’s presentation to give it a clean and spacious feel. Decluttering is one of those tasks that can be overwhelming, but it’s importance cannot be overstated. Decluttering will force you to decide which items to keep in the home. Additionally, staging your home can help balance space, furniture and décor. This can help home buyers envision living in the home.

Deciding on a list price is often a conundrum. Although enticing, don’t be seduced by the agent who tells you the highest sales price without understanding their rationale. The housing market can turn on a dime. If your home isn’t priced correctly, it can languish on the market. There are many aspects that go into deciding a price, so work with a respected seasoned agent to go through the market details and scenarios.

Finally, when the home is ready to list, how is it to be marketed? Today’s MLS listing syndication takes advantage of the fact that most home buyers actively search homes on the internet. Don’t rely on gimmicks that promise activity on your listing. A complete marketing plan will take into account the factors we discussed here, and apply strategies to attract motivated home buyers.

Original published at https://dankrell.com/blog/2019/01/12/occams-razor-home-selling/

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January 3, 2019December 13, 2022

New home diligence

It’s understandable that new homes are alluring. After all, newly built homes are modern and efficient. And there is the idea that new homes require minimal maintenance for the first year of ownership. But new homes are not flawless.

Last week’s Florida’s Attorney General home builder settlement is the latest reminder that new home buyers need to exercise due diligence. The multi-million-dollar settlement with PulteGroup, Inc came after a two-year investigation. A simultaneous complaint alleges that the home builder violated the Florida Deceptive and Unfair Trade Practices Act by: failing to disclose to certain home buyers in Florida that the homes were being constructed in violation of applicable building codes; unfairly denying certain homeowners’ repair claims for various reasons: unfairly denying certain Florida homeowners’ repair claims without performing an adequate inspection of the home; and unfairly withholding a customer’s deposit in certain instances. The details of the settlement can be found in the Florida AG’s December 28^th news release (myfloridalegal.com).

This settlement comes two years after the Florida AG entered into a settlement with KB Home in 2016 for similar alleged complaints.

Home builder complaints are more common than you think. In fact, Home builder complaints occur throughout the country alleging violations that may include (but not limited to): code violations, improper warranty denials, and improper handling of deposits.

Maryland’s Attorney General fined NVR Inc in 2012 because it was alleged that required warranty protections were omitted from their subsidiary new home contracts. A number of other home builders were fined that year for failing to register with the Consumer Protection Division’s Home Builder Registration Unit. And in 2016, the Maryland AG filed charges against a Rockville home builder for alleged violations of the Home Builder Registration Act, the Maryland Express and Implied Warranties Act, and the Consumer Protection Act. And more recently, the Maryland AG filed charges in September against a Baltimore County home builder for allegedly “failing to comply with Maryland’s Home Builder Registration Act, Consumer Protection Act, and the Custom Home Protection Act.”

Unfortunately, many home buyers let their diligence lapse when buying a new home. New home builder reps are friendly, helpful and often appear to be on your side, so it’s understandable how a home buyer may misconstrue the builder rep’s loyalties. However, when buying a new home, you should conduct your due diligence. You should also consider hiring a Realtor and a licensed home inspector to assist you through the new home buying process.

When buying a Maryland new home, you should know that the state regulates home builders. Before considering a home builder, make sure that the home builder is registered with the Consumer Protection Division’s Home Builder Registration Unit. Before entering into a contract with the home builder, review and understand the contract. You may want to consult an attorney to make sure that your Maryland new home contract complies with the state requirements.

You should also keep in mind that Maryland has established a Home Builder Guaranty Fund that is overseen by the Consumer Protection Division. The fund allows consumers to seek recourse “for losses resulting from an act or omission by a registered builder who constructs a new home for a consumer.” For additional information about due diligence when buying a new home and obtaining the handbook “Buying a New Home, Consumer Rights and Remedies Under Maryland Law,” contact the Maryland Office of Attorney General’s Consumer Protection Division (marylandattorneygeneral.gov/Pages/CPD).

By Dan Krell.
Copyright © 2019.

Original published at https://dankrell.com/blog/2019/01/03/new-home-diligence

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December 29, 2018July 22, 2019

Real estate futurism

Humans are fascinated with the future and technology. Whether it’s the promise of hope and deliverance, or the warning of a dystopian nightmare, there will always be a continued conjecture of the future. And it’s no different with real estate. Real estate experts also like to dream about the future and technology, and depict real estate futurism

Housingwire is one the foremost authorities on anything real estate and housing. It also is a leader in reporting about real estate technology too. This year’s reporting of Housingwire’s Tech100 Awards caught my attention. But it wasn’t about some shiny new technology that is touted to be “the next big thing.” Instead, it was the real estate futurism prediction and where real estate technology is headed (Expert: Here’s where real estate tech will be in five years, And will AI replace humans?; housingwire.com December 21, 2018).

Although the article was only one expert’s opinion of real estate futurism, it’s telling nonetheless. The expert sees that tech assisted appointments and automatic doors are technological advancements. Additionally, home buyers will be using virtual reality to view homes. He sees that consumer searches are geo-located. Big data will know what they want based on their online behavior, and so on. If his list of the industry’s future tech sounds as if it came from the early 2000’s, you’re not alone. If you think about it, much of this five-year tech advancement prediction has already been around in one form or another.

This expert’s vision of real estate tech in the not-so-distant future is basically more of the same. It makes you wonder if the real estate industry is focused on using shiny things to get people’s attention (but really doesn’t do much to make the transaction easier and safer). This interview also signifies that real estate futurism is relegated to existing tech. In other words, real estate technology is not exclusive unto itself, but is only the application of existing technology.

Predicting the future is difficult and requires the ability to depict a new paradigm. Spyros Makridakis, an expert in understanding future technology, writes that tech advancement depends on four things; (1) the benefits of the technology, (2) funding to create/implement the technology; (3) growth in funding the technology; and (4) the urgency to solve a problem (Forecasting the Impact of Artificial Intelligence, Part 5:The Emerging and Long-Term Future; The International Journal of Applied Forecasting; 2018; issue 51 p36-41). Makridakis’ vision of future technology will not be about shiny things that make you go “ohh,” but instead how you interface with technology.

Makridakis’ prediction for the future is that you won’t be using computer screens like you do today. Instead, you will have a type of wrist device that projects holographic images that will “blend virtual and augmented” reality. These devices will be like your smartphone but allow holographic communications. Additionally, brain-computer interfaces will allow you “unlimited access to computer power.” He believes that this paradigm shift will affect how you work and interact socially. He also believes that robots will become personal assistants and be assigned the boring and uninteresting work.

Real estate futurism based on Makridakis’ futuristic thinking could mean a slightly different home buying and selling process. Your augmented brain-computer interface will allow you to process information about a home significantly faster, as well as digitally sign AI prepared contracts and closing documents. And instead of scrolling through pictures or wearing a virtual reality mask, you will be walking through holograms of homes right in our living rooms projected from your wrist.

Original located at https://dankrell.com/blog/2018/12/29/real-estate-futurism

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December 23, 2018June 3, 2020

Does a shutdown affect home sales?

There hasn’t been this much anxiety about a government shutdown since October 2013. Back then, the government was “shutdown” for sixteen days. Of course, when the federal government “shuts down,” it’s really a partially interrupted. A majority of government operations continue. But even a partial government shutdown has the potential to affect home sales.

Since only a portion of government employees get furloughed during a shutdown, there is always confusion about which agencies are affected. Back in 2013 many home buyers were jittery about getting their FHA and VA loans processed so they could settle on time (the FHA is a part of HUD, while VA mortgages are guaranteed by the Department of Veteran Affairs). Additionally, many industry insiders were unsure about the impact a government shutdown would have on the recovering housing market.

Today we have some idea how government housing programs, specifically mortgages, will be affected during this time because most federal agencies publicly post their shutdown contingency plans.

FHA’s 2013 shutdown contingency was focused on maintaining consistency in the housing recovery. The contingency plan stated “The Office of Single Family Housing will endorse new loans under current multi-year appropriation authority in order to support the health and stability of the U.S. mortgage market. Approximately 80% of FHA loans are endorsed by lenders with delegated authority. The remaining 20% are endorsed through the FHA Homeownership Centers, leveraging FHA staff with a contractor that works on-site.”

The current FHA contingency is confident that most FHA loans will be unaffected. However, there is a warning that an extended shutdown can impact home sales. HUD’s Frequently Asked Questions in the event of a Government Shutdown, statement on FHA’s operations states:

“Because we are able to endorse most single family loans, we do not expect the impact on the housing market to be significant, as long as the shutdown is brief. With each day the shutdown continues, we can expect an increase in the impacts on potential homeowners. home sellers and the entire housing market. A protracted shutdown could see a decline in home sales, reversing the trend toward a strengthening market that we’ve been experiencing.”

VA loans may be better positioned. It is widely acknowledged that the Veteran Affairs learned from the government shutdowns that occurred in 1995-96. During that time, “Loan Guaranty certificates of eligibility and certificates of reasonable value [appraisals] were delayed.” However, because VA funding includes “advance appropriations,” a majority of the VA’s operations will continue during a federal government shutdown (including mortgages). The VA’s contingency plan indicates that in the event of a government shutdown 95% of VA employees will be fully funded or required to perform “excepted” functions.

Will a short-term federal government shutdown affect the housing market? Probably not. VA loans are expected to continue without much issue. However, certain HUD functions required for FHA mortgages could be limited, but not expected to cause delays in the short-term.

However, an extended shutdown has the potential to affect home sales. Consider that FHA’s mortgage market share increased to approximately 17 percent in 2017 (compared to about 13 percent in 2013). Significant FHA settlement delays could occur in long-term, which would surely have an impact on the housing market. However, considering that home sales have dropped off since the summer, and the market is typically slow during this time of year, the effect on housing will probably be negligible.

Original published at https://dankrell.com/blog/2018/12/23/shutdown-affect-home-sales

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