Recently in Homebuying Category

June 6, 2011

Houses With No Fix-Up Responsibilities Don't Exist!

The decision of where to live in retirement is tough enough by itself. But when you've got two spouses who disagree on priorities, the stress levels can shoot through the roof.

This was exemplified by a conversation I recently overheard (couldn't help but overhear, really) in which a man was describing how his wife not only wants to downsize for retirement, but dreams of finding a home that doesn't need any more fix-ups -- a newly built home, perhaps.

What's more, she has apparently been protesting whenever her husband fixes up their current home, on grounds that they'll soon be selling it and moving to that mythical "house that won't need fixing." The man doesn't agree with any of her arguments, but felt like protesting would risk their marriage.

I had to bite my tongue -- though it's the wife I'd really like to give some commonsense advice to (assuming hubby is telling the straight story).

d9b.JPGFirst off, a house that doesn't need fixing? It doesn't exist. Older houses, though in many cases well built at the time, will inevitably need attention to combat the effects of aging. A new roof, new foundation, structural changes if you want to remodel and need to bring other aspects of the place up to code in order to get a permit, are all on the list of likely fix-ups.

Newer houses, meanwhile, though fresh and up to code, can be a nightmare. Hurried and often shoddy construction -- basic stuff, like windows installed wrong way out -- by developers trying to make a buck in a tough economy are typical complaints . (For more on that, see Nolo's article, "Newly Built Houses: Pros and Cons of Buying.")

As for putting off maintenance because you think you're about to sell? Bad idea, unless you want to sell for far less than you could have. Deferred maintenance leads potential buyers to wonder what deeper problems you've also been ignoring, and to lower their offer price accordingly -- or just pass on the house altogether. Just what shape the house should be in is covered in Nolo's FAQ, "How much should I fix up the house before selling it?"

Sad to say, I'll probably never find out the end of this story. But I imagine it's playing out among numerous couples around this country, with numerous endings.     
May 19, 2011

Fighting Over Fixtures: Not Just a U.S. Syndrome

The United States practically invented litigiousness, so you might think that the frequent arguments between home buyers and sellers about what stays and what goes was a uniquely U.S. phenomenon.

Disputes regularly crop up about curtains, light fixtures, appliances, plants in the garden, cabinet knobs, and more. Sometimes the seller leaves the buyer a rude surprise and strips the house of favorite features just before departing. 

So, we can take some small comfort in discovering similar behavior goes on right across the pond (albeit with more charming vocabulary, for those of us with Anglophiliac tendencies). It's all revealed by Country Life magazine from the U.K., in a December 2010 article called, "Fighting over fixtures and fittings."

Here, we learn about:
  • the seller who demanded money for each of the "loo-roll holders" in the bathrooms
  • the seller who counted up all the lightbulbs he was leaving in the house (mansion, really) and asked to be compensated for those
  • the sale that nearly fell through over the sit-down lawnmower (the real estate agent saved the day by purchasing it for the buyers out of his own pocket)
  • the seller who insisted on removing both the integrated dishwasher and the "bespoke panel" that topped it (I had to look up "bespoke" -- it means custom-made)
  • the seller who removed the mahogany loo seats without replacing them
  • and more!
lightbulb-735969.jpgDo these disputes become more understandable when we realize that Country Life focuses on high-end properties, as in multi-room manors or country houses? Those lightbulbs and loo-paper rolls can really add up.

But the human tendency to get bogged down on small details seems to transcend country or price.

As one agent quoted in the article aptly put it, the two parties tend to develop "stiff-legged terrier syndrome. . . . even with houses worth several million pounds."

For a reminder of what a home seller is expected to leave behind in a U.S. property -- although the buyer and seller can always negotiate differently -- see the first question in Nolo's "Selling Your House FAQ."  
April 27, 2011

Looking Past the Staging: Lesson 1 for Buyers

In more and more parts of the United States, the days of walking into a home for sale and seeing kids' photos, favorite team pennants on the walls, and a kitty litter box in the bathroom are long gone.

They've been replaced by "staging," in which most or all of the seller's possessions are cleared out and replaced by specially chosen and designed furniture and accessories. The final effect should make the house look both inviting and thrilling -- a place to imagine your life will be better than it's ever been.

Do I encourage staging for sellers? Absolutely: I've seen it produce fast sales at full price or above in too many cases to doubt its effectiveness. 

But if you're a home buyer, you need to keep your wits about you. Remember that, as wonderful as homeownership might be, your life will still involve the need for things like space for normal-sized furniture, storage, and so forth.

Take the photo below, for example. It's a beautifully done staging job, which makes everyone who sees it go, "Aww." As a seller, I'd be delighted.

IMG_3213.JPGBut if you're the buyer, you have to ask yourself: Will this room fit a bed and desk for when the baby is a teenager? Maybe not. Using pint-sized furniture is a common way for stagers to make a small room look bigger. In fact, you might want to bring a tape measure and a list of measurements of your important pieces of furniture.   

More lessons to come . . . .

Continue reading "Looking Past the Staging: Lesson 1 for Buyers" »

April 25, 2011

Presentation for Home Buyers at Laurel Book Store, Oakland, May 11

logo_only_small.JPGHey, Bay Area friends hoping to become homeowners, come on down to one of our best beloved independent bookstores, in Oakland's Laurel District, on Wednesday, May 11th at 7 pm.

Why? Aside from the Laurel Book Store being an excellent place to hang out and buy books and other cool stuff, I'll be making a presentation based on my book, Nolo's Essential Guide to Buying Your First Home, just out in its 3rd edition. (And a Nolo bestseller!)

The theme I'm planning to focus on is, "How Buying a House Is -- And Isn't -- Like Buying a Pair of Jeans." You'll have to be the judge of how far I can stretch that analogy to fit. In any case, I'll cover lots of useful topics, from how to evaluate your finances to how to negotiate the best deal. 

And click here for the details from the Laurel Book Store's events page. 
April 15, 2011

Is That Open House Really for Sale?

In my earlier post, about asking questions when visiting open houses, I forgot one of the most important questions: How fast are things moving here, i.e. what's the timeline for receiving offers?

IMG_3307.JPGYou might discover -- as is not uncommon -- that it's already too late, or very nearly so. The house is in contract,  but the agent is holding the open house anyway.

Why would the seller go ahead with an open house with an already pending sale? Several reasons are possible, such as:

  • just in case the first contract falls through -- in which case other potential buyers will have seen the house, and the seller doesn't waste time restarting the process
  • to try to bring in a backup offer, which will come into play if the first contract falls through (though its real purpose, from the seller's standpoint, is often to put pressure on the existing buyer to act in a cooperative manner and not start nickel-and-diming the seller over issues like repair needs)
  • for the sake of the agent, who can use this chance to meet with the homebuying public and perhaps pick up new clients.
Of course, if you're visiting houses with a real estate agent, the agent should already have the inside scoop on the place. But if you're just starting your search, or operating on a casual basis with an agent whom you've arranged to call if you see a place you like, be aware of this issue. It's no fun falling in love with a house only to find out someone else got there first.

(P.S. The photo above doesn't represent a place that continued holding open houses after getting a contract signed -- it's just a random photo to relieve your eyes from the text!)
April 4, 2011

Visiting Open Houses? Ask Questions!

I've started engaging in one of my favorite springtime hobbies: visiting open houses. I'm not alone, either -- I was literally bumping elbows with other visitors on the staircases.

Some of the visitors looked genuinely interested in the homes, a few were conferring seriously with their agents in the corner, and others were probably nosy neighbors just like me.

But the one thing no one seemed to be doing was asking the listing agent, who was typically just standing in the front room looking bored, any serious questions. I sometimes ask questions, just for my own curiosity -- and I often get some interesting answers.

For example, by asking "What's going to happen to that vacant lot behind that back fence?" I learned that it was up for sale as well, and would likely contain a new structure soon. If I'd been a serious buyer, that's something I would have wanted to know about well before falling in love with the place.

Tulip path.JPGIt doesn't take a real estate expert to think of likely questions to ask: Just look around, and think about the practicalities of living in the place, or what the future might bring.

Also read the brochure. If it says "Monthly condo fees," ask for a dollar figure. If there's been a price reduction, ask what the original price was, and how long the place has been on the market.

Or if you can't think of anything else, ask how the open house has been going, and whether other people have requested disclosure packets or expressed serious interest in the place. You might get some interesting answers too! 
March 18, 2011

Overdraft Protection Worse for Credit Score Than Bouncing a Check?

Yes, I was surprised too. But apparently opting  for overdraft protection on a checking account may result in a credit inquiry and is viewed similarly to you adding another credit card to your mix, both of which can actually hurt your score a bit. Meanwhile, banks don't report bounced checks to the credit bureaus. And as every homebuyer knows, every point on your credit score can be important when qualifying for a mortgage to buy a home.

Get the details in Marcie Geffner's article, "Banking and Your Credit Score."
February 10, 2011

First-Time Homebuyers -- Could Your Landlord Ruin Your Credit Score?

If you're renting now, and planning to buy, you need to read this new article by Attorney Janet Portman -- particularly if you've got a difficult landlord, and may have to withhold rent payments anytime soon.

The long and short of it is that Experian, one of the three major credit reporting agencies, has implemented a new program that allows some landlords (particularly those with a lot of properties) to regularly report their tenants' payment records. All very well and good for the tenants who always pay on time, but not so great for those who don't -- even if the nonpayment was for perfectly legal reasons.

A positive credit history and score is crucial when trying to line up financing to buy a home. So unless you're one of the lucky few who plans to pay all in cash (rumor has it they exist), keeping your score high should be tops on your priority list. For more advice on that, see Nolo's article on "Credit Scoring." 
January 24, 2011

For California Home Buyers and Sellers: New Editions of Nolo Books

What's so special about California real estate? Well, lets see: This state requires sellers to disclose more to buyers about the condition of the property than most other states do; its real estate market requires careful local study, with foreclosures the norm in some areas and bidding wars still taking place in others; and because California law doesn't require lawyers to be involved in the transaction, it gives buyers and sellers good reason to find a great agent and educate themselves about the process.

And that's just the beginning. (Notice I didn't even mention researching whether your house -- or prospective house -- is on an earthquake fault line?) All of these are among the many topics covered in the latest editions of Nolo's popular books, How to Buy a House in California and For Sale By Owner in California -- recently updated with the latest on legal requirements, market trends, mortgage options, and more.
January 17, 2011

Condo Shopping: What's With the Salesperson's Countertop Obsession?

With snow blanketing the East Coast, it's no surprise our out-of-town visitors thought checking out retirement condos in California would be a nice way to spend an afternoon. Better yet, prices are down, as many condo units sit unsold.

So, we waltzed into the sales office of a high-rise luxury condo unit in Oakland. The salesperson looked happy to have a reason to get out of her office -- it appears she's been sitting there since 2008, slowly selling off the inventory.

In fact, she's probably getting a little bored. Which may explain the countertop obsession. While we were looking at the model unit, and asking sensible questions like, "What are the monthly homeowner dues?" (at over $400 per month, I hope she was planning to mention that topic soon), she was pointing out the color of the granite countertops.

Indeed, those countertops do come in an amazing array of colors, from black to green to tan, with evocative names like "Uba Tuba" and "Baltic Brown." They're shiny. They're fun to touch. In fact, the more I looked at them, the more I wanted to be the one choosing countertops for my unit -- which I guess means I would've had to buy a unit. Hmm, if I were a cynic, I might believe that that was her plan all along, to get us thinking about decorating before having made the decision to buy, so that buying becomes almost a foregone conclusion.

Good thing I'm not a cynic.