10 TIPS FOR TURNING YOUR NEW HOUSE INTO “OUR HOME” Written by PJ Wade on Monday, 31 August 2015 2:10 pm PRINT | EMAIL Close More Deals – Qualify homebuyer leads fast and free When you’re moving into a new house, the more you know about it before you must know— during a high-pressure day, emergency, or crisis — the happier you and your family will be. Closing day took care of the legal and financial aspects of taking on ownership of your new home while move-in day got you and your stuff into the premises. We helped you, sanity intact, move-in with Three Sanity-Saving Tips For Moving-In Day. To top off this success, we’ve compiled a list of practical “must do’s” to ensure settling in is the beginning of belonging. Get off to a great start in your new home — new or resale — by attending to these “little details” which will also make this feel like “our home.” Ignore them and they can cause problems down the road. Involve the whole family in dealing with these 10 tips and everyone will feel at home. #1. Our New Passwords: Change codes and passwords for security systems and anything else you are taking over from the previous owner. Make sure the new version is significantly different, so it can’t easily be guessed. Record passwords and keep in a safe place. #2. Our New Keys: Change the locks on the house, garage, outbuildings, and gates. If you’re happy with the existing hardware, a local locksmith can re-key or change the lock cylinder or replace the interchangeable core, depending on your system. Check window locks to ensure all are fully functional. #3. Our Smoke/CO Detectors: Check with the local fire department to learn where smoke/ CO detectors and fire extinguishers are required or recommended. Interconnect units if possible. Check existing units for expiry dates. Never install a smoke/CO detector in your home without understanding how it operates whether it is hardwired or not. If not, install new batteries today and add a replacement date to your maintenance calendar. (This will also be a move-in anniversary reminder.) #4. Our Manuals: Start a digital and/or paper folder for manuals for every appliance, detector, and operational device that could need repair or replacement. Jot down maintenance reminders on your maintenance calendar while you inventory what you have. #5. Our Electrical Breaker Panel: Where is it? What does each circuit breaker connect to? Get out the labels and do a room-by-room check so you know what’s what and record this by each breaker. If you have cable or other wired services, find out when the exterior and interior cables and hardware were last updated. You may be due for an upgrade. #6. Our Water Shut-off: Where is the main shut-off? How do you turn off the water line to the refrigerator, dishwasher, washing machine, and every other potential source of leaks? Check temperature settings where applicable to suit your conservation plans. If the water heater or anything else, is rented, compare this arrangement to the cost of buying a new one. #7. Our Furnace: Clean or replace filters in the furnace, range hood, air conditioner, and any other filtered appliances. Note times for the next clean on your maintenance calendar. #8. Our Clean, Dry Home: Steam cleaning carpets is a no brainer, but make sure gutters and downspouts are cleaned, too. To ensure the house stays dry, check that the grading is correct all the way around the house. Are windows and doors properly caulked to keep interiors cosy and draft-free? If you’ll be parking under sap-dripping evergreen trees, you’ll need something to safely remove the sap, but not the car paint. #9. Our Undisturbed Garbage: Ask neighbors about local pests and wildlife to make sure you prevent their invasion. That’s a lot easier than getting rid of them once they settle in — pests, that is, not neighbors. A copy of the garbage pickup schedule is essential. #10. Our New Closets: Don’t make do with someone else’s closets. Fit out closets with racks and shelving that suits you. Do it now instead of later wishing you had and you’ll always be pleased you moved into your closets properly from the start.
© Patrick T. Fallon/Bloomberg Open House signage is displayed outside of a home for sale in Redondo Beach, California. Don’t let signs of a home’s previous life deter you from making it your dream home. The sellers may not have had the time, money, or willpower to professionally stage or remodel their homes before their open house, but that isn’t always a bad thing. While a turnkey home is ideal for people who want to move right in and make no changes, don’t ignore those “time warp” homes. They can be incredible gems that just need a little polishing. As you step into each home while you’re house hunting, try your best to ignore these nine buyer turnoffs that are actually pretty easy to adjust. Custom Real Estate Signs – No Minimums, Quality Guaranteed. BuildASign.com/RealEstateSigns Bing is rated ★★★★★ ★★★★★(1310 reviews) 2300+ followers on Twitter AdNo Minimums, Quality Guaranteed. Buy Now – 15% Off + Free Shipping! Free Shipping on Custom Signs Custom License Plates – $13 Cheap Yard Signs Magnetic Car Signs – $20 +Free Ship Bumper Stickers Under $1 Free Troops Banners 1. An older home “Old” isn’t synonymous with bad. In fact, sometimes newer homes are more affordable simply because they were built with cheap materials — and that may cost you more money in upkeep than a home built decades ago with quality materials that have proven to stand the test of time. Remember that there are many simple fixes to modernize a dated home, and many older homes are full of charm and character that you can’t find in a brand-new build.
0:07 / 2:11 How Will I Know I’m Ready to Buy a Home?
32 shares Does Zillow promote dual agency and anti-consumerism? Some say yes, others say no CORPORATEZILLOW September 16, 2015 Steve Cook dual agency1 zillow35 Sometimes our best friends think they are doing us a favor when they should do their homework first. Case in point, the flap over Morgan Stanley’s recent report to investors on Zillow that implies the search giant has an anti-consumer slant in their advertising platform that is said to promote dual agency. Before we dig into the study and responses it has drummed up, let’s get up to date on the sticky dual agency issue. How dual agency works Every newbie learns in real estate school that dual agency relationships can be toxic because 1) in some states they are outright illegal, and 2) in the remaining states, disclosure rules are complicated and vary significantly. For example, some require written disclosure forms be signed by all parties. Others require disclosure forms be attached to the sales contract. Further, some brokerages have policies on dual agency, others do not. The lure of bringing home a double-ended commission is very real and there’s no doubt, especially in these times of rampant pocket listings, that some agents and brokers play with fire for the big pay day. The payoff, however, pales quickly when the slightest oversight in carrying out one’s fiduciary duty can lead to failure to disclose one party or the other, the result can be very nasty lawsuit or even loss of license. Examples of dual agency lawsuits: For example, two years ago, a top agent at Sotheby’s New York was sued after a seller alleged that he had breached their exclusive sale contract for his Manhattan apartment by clandestinely working with a prospective purchaser, effectively lowering the sale value of the home. The case led to a New York State investigation last year that implicated the CEO of Sotheby’s. Or, consider the Ohio agent last year who decided to go dual in violation of her own company’s policy and ended up being personally liable for failing to fully disclose all of a property’s defects to the buyer, even though the seller provided them to her in writing. It cost her $216,337 plus legal fees. Advertise with The Real Daily Then, there was there was the Mississippi case where a broker acting as a dual agent failed to tell the buyers that the house had suffered $35,000 worth of termite damage. The case resulted in suits and counter suits and went all the way to the state Court of Appeals, where the broker lost. Does dual agency hurt home values? Years ago, NAR estimated that nearly one-quarter of all lawsuits filed where real estate licensees are named as defendants involve “agency” disputes. Clearly, dual agency is as big an issue today as it was decades ago. Moreover, there’s evidence that dual agency is a bad deal for the seller. A study published two years ago by the Journal for Real Estate Research found that dual-agency sales that occur in the first 30 days of the listing contract sell for roughly an 18% premium because agents may be able to more efficiently match the property with the right buyer if they search within their own network. But sales during the last 30 days of the listing contract sell for roughly a 6% discount, or $9,300 less. Overall, a dual-agency representation reduces sale prices by about 1.7%, according to the study. Now, on to Zillow and dual agency Enter Morgan Stanley’s research arm, Alphawise, with a September 10 report. “Our Alphawise study suggests that Zillow is enabling agents to increase their number of dual agency transactions… The key implication is that dual agency transactions offer lucrative economics, and by driving an increase in these transactions, Zillow is strongly reinforcing the return on investment (ROI) proposition for agents who successfully advertise with the platform. “Our Alphawise study finds that for +60% of Zillow premier agents, advertising on Zillow enabled them to increase their number of dual agency transactions and specifically drove a ~30% increase in these transactions.” Zillow’s advertisements are leading to a 60 percent increase in dual agency deals? NAEBA implies a lack of loyalty to consumers The report did not sit well with the National Association of Exclusive Buyer Agents, a sworn enemy of dual agency. “While that may be great news for the agents who get twice the pay for the same transaction, it’s not great news for consumers,” said NAEBA in a statement. “Real estate buyers deserve to have someone on their side throughout the transaction,” says Chris Whitehead, NAEBA President. “Settling on a Zillow Premier Agent who is unlikely to be loyal only to them is not in the consumer’s best interest.”
Home truths: Know before you buy BUYER BEWARE Even in a favorable market, house hunters should be cautious.You can’t get more direct than this e-mail we received from Maria Rosenfeld of Miami: “I’m a first-time home buyer and need help on getting started. I don’t know how to buy a home. What are the steps I need to follow?
”Even if you’ve been in the real-estate game before, today’s market is confounding. An estimated 1.1 million homes are in foreclosure, the most since 1979. And it’s not just subprime mortgages that are a problem; the default rate for borrowers who qualified for prime loans is climbing as well.
“Buying, selling, remodeling” offers advice for consumers who face a variety of scenarios in today’s fragile housing market. Sellers are obviously in a tough position. And we’ve been hearing how great it is to be a buyer right now and how it may be a good idea for investors to pick up a house or two while prices are low. I turned to our finance editors at Consumer Reports, our finance advocates at Consumers Union, and experts at other consumer groups for their advice. They had strong words of caution.A home is to live in. For most people, seeing real estate as an investment that will surely appreciate is risky business.
For one thing, while prices are already down in many parts of the country, they might go lower. So the cheap house you buy now could still sink in value. And while we’ve become accustomed to 6 or 7 percent returns on real estate, historically prices have just kept pace with or barely exceeded inflation. It’s probably wise to buy a home you want to live in rather than an investment with four walls.Choose your mortgage (and your broker) carefully.
The mortgage broker may be more focused on selling you a mortgage than on getting you the best deal—that’s your job. Find out what you can afford and the best terms for you; up to half of borrowers who took a subprime loan would have qualified for a conventional mortgage with better terms. Start by going to www.bankrate.com or www.hsh.com for worksheets.
Don’t count on refinancing out of a bad loan; falling home values could prevent that.Search on your own terms. Once you have a clear idea of your budget, your hunt should be easier. Consider an exclusive buyer-broker who will represent only you, not the sellers. Nonexclusive real-estate agents tend to show you their own listings first, since they won’t have to share the commission if they represent both the buyer and the seller.
Then they’ll probably show you their firm’s listings, since they stand to gain from those sales as well. It can help to search online first and target some homes that might be right for you, no matter who has the listing.
Buyers should beware using seller’s agent
By Michael Estrin • Bankrate.com
There’s an adage that says you get what you pay for. The warning is especially relevant for homebuyers who work with the listing agent in a so-called single-agent transaction.
“I’ve heard too many war stories about buyers who think they’ll get a better deal by going directly to the listing agent of the property,” says Bill Golden, a Re/Max agent in Atlanta. “Most often, they do not get a better deal, and they end up not being represented properly in the negotiations.”
In fact, buyers who use the listing agent aren’t represented at all, which is why single-agent transactions seem abhorrent to many real-estate professionals.
“If you were being sued by someone, would you use the same attorney as the person suing you? Of course not,” says Deb Tomaro, a Re/Max agent in Bloomington, Ind. But data from the National Association of Realtors seems to suggest that as many as 10 percent of residential transactions could be single-agent deals. (The trade group doesn’t have direct figures on buyers using listing agents, but instead relies on member surveys, which track real estate firms, not individual agents.)
Confusingly, the terms “dual agency” and “single-agent” transaction mean the same thing, with the difference being that of perspective: The agent sees his or her role as that of a dual agent because the agent represents both parties, whereas a buyer would view a deal with only one agent as a single-agent transaction.
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Why do buyers work with the listing agent?
Typically, buyers who choose to work with the listing agent say they do so because they think they’re getting a better deal. But agents like Jon Sterling of Chase International in Tahoe City, Calif., have doubts.
“The idea that buyers can negotiate to get the listing agent to give up part of their commission because the buyers are unrepresented is a myth,” he says. “Sure, some people have been successful doing that. It’s the exception, not the rule.”
It also doesn’t make much sense when you consider that sellers, not buyers, typically pay commissions, according to associate professor Eric Chen, who teaches business at the University of Saint Joseph in West Hartford, Conn.
“If the buyer is working with the listing agent, be aware of the conflict of interest problem that exists,” says Chen. “Remember that the listing agent is interested in getting a deal done, and the higher the purchase price, the bigger the commission to the agent.”
Do buyers actually pay more?
Data are mixed on whether buyers in single-agent transactions end up paying more, according to Bennie Waller, a finance and real estate professor at Longwood University in Farmville, Va., who has co-authored two papers on the topic. But the reason for the mixed results, says Waller, most likely has to do with the time the property is on the market. Single-agent deals that happen within 30 days of listing typically sell for a 10 to 18 percent premium. But when the property sells within the last 30 days of the listing contract, the price actually drops by 5 to 6 percent.
What’s the harm?
The problem with the single-agent deal is that it makes it impossible for the agent to fulfill a fiduciary duty to both parties.
“The agent has an inherent conflict of interest when working with the buyer,” says John O’Brien, a Chicago attorney who handles real estate transactions. “It is very difficult for the agent to keep his knowledge of the buyer’s negotiating points, including their best price, from becoming known to the seller, either directly or through the agent’s advice to the seller regarding counter-offers.”
Beyond price, buyers should understand that a single-agent deal creates the opportunity for a problem on virtually every deal point, says Chen.
“Because of the conflict of interest, there is a real chance that the agent doesn’t have the buyer’s best interests in mind,” Chen says. “It doesn’t necessarily happen every time. However, the pressure, opportunity and rationalization are all there for the seller’s agent to act in their own client’s interest and against the interests of the seller.”
Not everyone sees an automatic conflict of interest.
“There are some who feel that it is an automatic conflict to represent both parties,” says Sterling Watkins, a broker-owner with Help-U-Sell of Folsom, Calif. “I happen to disagree. If no confidences are violated, each party has a chance to make a decision at every turn in the road.”
Although Watkins certainly has the minority opinion on the matter, it’s worth pointing out that most real estate firm contracts do contemplate the possibility of a single-agent deal. But, as Chen says, “that language usually looks an awful lot like a waiver.”
Most prospective house hunters or sellers think they have a “good” agent. Either it’s someone who they previously worked with or perhaps a referral from a friend or a co-worker. One of the big reasons for having confidence in their agent is a belief that the agent is “on their side” and “honest” etc etc. I would suggest however that by a certain point in the process, your agent is your enemy and you are negotiating against them more than the other party. This post deals with the buy side of the house buying game. The next post will deal with the sell side.
In the beginning: happy friends
When a house buyer first signs up with an agent, things are usually pretty rosy, the agent assures the person that they can find an appropriate house for a price you can afford and everything will be great. The agent has “lots” of experience and knows the area inside out. At this stage of the game, you and your agent are mostly on the same page. You want to buy a house and they want you to buy a house. Your agent will most certainly want to get the process over with sooner rather than later, but that’s usually the case with the buyer as well.
During the search: uneasy allies
Agents know that they need to spend a fair bit of time with a buyer, especially ones who want to look at a lot of houses. After a while however it’s not worth it for an agent to continue a long search especially if their contract is running out. This is the time when the agent will start trying to convince the buyer to lower their standards and raise their prices. Sometimes this is educational if the buyer has unrealistic expectation, but mainly this is to speed up the process so the agent can get paid. I should point out however that real agents are normally quite useful during the search since they often know more than you do about the general real estate and can get you access to private showings. The other big benefit is their access to sale price information for similar houses.
Related – How to win a house bidding war
Thinking about putting in an offer? Trust no one!
The point when the buyer submits a offer on a house is a time when a lot of house buyers, particularly first timers feel out of their element and defer to their agent for advice. This is the worst thing you can do. Your agent gets paid when the deal gets done and only when it gets done.
This is a time when knowledge of the real estate market should be a big help in determining how much negotiation should be done. As well, if the buyer is not in a hurry to buy then that sets up a great negotiation opportunity. However if there is one thing that real estate agents don’t like it’s clients who negotiate hard – why? Because the only way to negotiate properly in a deal is to be able to walk away if the price you want isn’t met. The way an agent sees this type of situation is that if a deal falls through, they have to spend a lot more time looking at houses with you before they get paid.
Things that your agent might say (and you should ignore) when you are about to put in a bid are:
- “Don’t bid too low or you will offend the sellers”. This is garbage – if the sellers can’t handle a low ball bid then they are unrealistic. And what exactly is a bid that is “too low”? I’m not saying put in an unrealistic bid, but don’t be afraid to start low and work your way up. It’s important to know the market so that you don’t have to rely on the asking price or your agent to tell you the proper market value of the house.
- “Don’t bid too low or you might offend the selling agent and might I have to work with them in the future”. This stunning example of gall and self-interest was actually told to Mr. Cheap. I don’t think this one needs any further comments.
- “You should get a bid in quickly before someone else puts a bid in”.This is a favourite of my agent – create a sense of false urgency, get the deal in motion and get it done ASAP. Sometimes this is good advice, but other times – such as when the house has been sitting on the market for a month or longer then it’s just not appropriate.
- “Someone else is looking at the house later today and they are really interested”. This lie usually originates with the selling agent, but smart buying agents are usually more than willing to play along because it will increase the chances of their buyer putting in an offer in that day.
Negotiation – don’t listen to a word your agent has to say.
At this point you are potentially pretty close to buying a house. You want to buy the house at the lowest price, the seller wants to sell the house to you at the highest price and your agent wants you to buy the house and doesn’t care at all what price you pay because they just want the deal done right now. Since paying a higher price will get the deal done quicker, a lot of agents will encourage you to bid higher which basically means that you are negotiating against them as well as the seller.
Things that your agent might say (and you should ignore) when you are negotiating are:
- “Meet them halfway or in the middle”. This sounds quite reasonable at first- if the asking price of a house is $500,000 and you bid $460,000 and they come back with $490,000 then isn’t splitting the difference at $475,000 quite reasonable? Not if you can get the house for $470,000 or $465k,000 The fact is that the asking price of the house and your first bid are very arbitrary numbers and splitting the difference between the two might end up in a price that is not market value.
- “Are you willing to lose this house for $2,000?” (or $5,000, $8,000) This is a tough one – on the one hand it seems silly to not buy a house and be only a half of a percent away from a deal, but on the other hand shouldn’t your agent be asking this question to the seller? Ie – “We are going to walk, do you really want to lose this deal for $2,000?”
- “Are you willing to lose this house for $12 a month?” This is part two of the previous point which is applied if you don’t bite on the first attempt. It’s also a more useful gambit if the “separation” is a bit greater. If you and the seller are $12,000 apart, that sounds pretty significant, but what if you are only $75 a month apart (for 25 years) or even better what if you are only $63/month apart (over 40 years). That doesn’t sound like much (even if it is).
The more you educate yourself about the real estate market you are looking in and how real estate agents operate, the better off you will be when buying a house. Real estate agents are quite useful because they can get you access to houses for sale and will often drive you around to look at them plus they have access to the sale price of other houses. Whatever you do, never forget that they get paid when the deal gets done and only then. They don’t get paid for showing you more houses or walking away from close deals.
Tune in tomorrow when we take a look at the trustworthiness of real estate agents when selling a house.
Take a look at another perspective on real estate agents that Mr. Cheap wrote.
Do you have any good “lines” that you were told when buying a house?
Learn How The National Association of Exclusive Buyer Agents Can Help Home Buyers
The National Association of Exclusive Buyer Agents (NAEBA) is an organization of real estate professionals who have dedicated their business lives to representing only buyers of real estate. We don’t list homes for sale and never represent sellers. This restriction to one side of the real estate transaction stands out as vitally important in light of what has happened in real estate in the last decade or so.
Since several states discarded the common law of agency in the mid-nineties, the real estate agent’s duties of obedience, undivided loyalty, confidentiality and reasonable care have been greatly diminished. More importantly, most consumers are not aware of agency concepts. The net effect all too often has been that real estate salespersons, and frequently affiliated loan officers, have pushed home buyers and speculative investors into inappropriate loans. This practice went largely unnoticed and unregulated, playing a major role in the mortgage and financial crises that began in August of 2007. It continues to plague us today.
Real estate agencies that represent both sellers and buyers, known in the industry as dual agency brokers, maximize their income but shortchange both buyer and seller clients. Though dual agency is legal in almost all states, the ethics of such representation is questionable even when the seller and buyer understand and consent.
Disclosing whom the real estate agent represents is an accepted standard. The timing of such disclosure varies by state in a patchwork of requirements by law or regulation. However, as Blanche Evans pointed out in a 2006 article in Realty Times, a study by the National Association of Realtors revealed that only 30% of homebuyers received a disclosure statement at the first meeting, 28% when the contract was written, 22% didn’t receive one at all and 20% were uncertain if they received one.
First time home buyers, as a group, fared worse with only 23% receiving disclosure at their first meeting.
When you purchase a home, whether it’s your first or fifth, you deserve an agent who is trained and dedicated to serving only you the Buyer. The NAEBA members continue to provide full agency duties of obedience, undivided loyalty, confidentiality, full disclosure, accounting and utmost care to their clients. I hope that when you buy your next home you will choose one of our members and benefit from 100% representation 100% of the time.
Benjamin Clark, 2009 – 2010 NAEBA President
See Why The Media and Consumer Groups Recommend an Exclusive Buyer Agent
Exclusive Buyer Agents are recommended throughout the media, by consumer organizations, and by HUD.
What you need is what’s known as an “exclusive buyer agent.”
CNN Money. “Money 101, Lesson 8: Buying a Home.” Undated. http://money.cnn.com/magazines/moneymag/money101/
What Is A Real Estate Agent?
What Is An Exclusive Buyer’s Agent?
Why Use An Exclusive Buyer’s Agent?
The Case For Buyer Agents
How Do I Find An Exclusive Buyer’s Agent?
National Assocation Of Exclusive Buyer Agents
Real estate glossary
Learn About Different Types of Buyer Agents
An Exclusive Buyer’s Agent or EBA is someone who is an expert in the buy-side of a real estate transaction. Just as you would see a cardiologist for your heart or would hire an electrician to wire your home, an EBA is a specialist in the real estate industry. Most NAEBA member EBAs have years of experience and have learned to strongly negotiate on a buyer’s behalf, what to look for when viewing a property, and how to overcome obstacles that a buyer may face along the way.
Exclusive Buyer’s Agents give buyers their undivided loyalty. Most real estate agents and buyer’s agents work in traditional brokerages that take listings. Because of that, they have an inventory that they must sell. In addition, if that brokerage brings both the buyer and the seller into the transaction, they get to keep the entire commission, making the transaction more profitable. These can be strong incentives to steer a buyer to one of their own listings. It also means that their buyer loses many of the benefits of hiring a real estate agent including negotiating on his behalf as well as the agent’s ability to point out reasons why the buyer might not want to purchase that particular property. Since Exclusive Buyer’s Agents must work in a brokerage that only works with buyers and never takes listings, a buyer can rest assured that the EBA will remain on their side throughout the entire transaction, getting the buyer the lowest price and the best terms possible.