The Ups and Downs of Mortgage Rates

I know you don’t have a crystal ball, but what do you think about mortgage rates right now?

The short answer: I think they will only go up!  We just had a slight drop in the rates this past week, but that is not expected to hold. If you are considering buying, now is definitely the very best time to take out a loan – by next month rates could have bounced back up again! There is really only one problem I see with this otherwise sage advice – inventory is very limited right now!  You may not find anything that you want to buy!

The good news is we do have a new mortgage product that will allow you to lock the rate for 60 days, even if you haven’t found a home!  The process is quite simple.  The loan application is processed just like if you had found a home – you make full application and turn in your paperwork.  You then have 30 days to get a home under agreement and the remaining 30 days to close.  For those of you who are committed to buying in the short term, this is a very good option to guarantee you the lower rate while still giving you time to shop. If you don’t find a home within 30 days, you do lose the rate lock but you would have still completed the paperwork for your future loan application!

Prospective sellers, lower rates are good news for you too!  Buyers can afford more when rates are lower and home prices therefore tend to be a little higher. We are officially in the long-awaited spring market, rates have dropped a bit AND we have a scarcity of inventory – the perfect trifecta if you are contemplating a sale! Give me a call and we can develop a strategy to maximize your return in this favorable climate!

 

 

 

1432 Beaver
Complete architect-designed interior renovation of this elegant Sewickley Village Queen Anne Victorian. Sited on a private 1.7 acre lot in the heart of Sewickley Village.  Meticulous renovation and transformation into a home that works perfectly for millennial families. 5000SFF+. Remodeled kitchen. Completely redesigned master suite, with sitting area. Impressive development of the lower level. $1,150,000  Read more…

 

 

1 Ohio River Blvd
NEW PRICE!! Outstanding opportunity to own this signature commercial building with over 4000SF of space. Great visibility at the prominent intersection of Route 65 and Beaver, 2 minutes from I-79 and only 11 miles from downtown Pittsburgh. Off-street parking for 8-10 cars. Suitable for many uses, the two-story space is currently configured with several offices and conference spaces, mezzanine area, additional open areas and two restrooms. An excellent investment opportunity, this is a versatile building with a flexible layout, high ceilings, a multitude of possible uses and an ideal location.  $169,000  Read more…

I’m ready to answer any questions you have regarding your real estate needs.
 
 
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

Getting a Jump on the Market

Now that Christmas is behind us, we are thinking about making a housing change in 2019.  What is the optimal timing?

The strength of our early spring market is always weather dependent here in sunny Pittsburgh! In a “normal” winter our spring market starts in earnest in mid-January. Certainly by February you would want your home on the market if you are seeking a spring sale. Our early spring buyers (January, February and March) tend to be our best, especially following a period of such unheard of inventory lows. There is currently a long line of buyers eagerly waiting for new market introductions – the competition will likely be great in the early months of our new year, maybe even driving in more of the bidding wars we saw this past fall.

Of course, the interest rates have climbed steadily throughout 2018 and that may put a bit of a damper on rising prices in 2019 – but if inventory remains as low as it has been in 2018, the impact should be minimal.  And if we have a rough winter, as some predict, it may slow the start of our spring market.  But of course, we won’t know that until we are in the thick of it.

All things considered, my best advice to you is to give me a call today so that we can design a strategy that is best for your family and your personal goals. Being ready to go in the spring market as soon as it starts to show signs of life, be it January, February or March, will inure to your benefit!

 

111 Skymark

Gorgeous all brick newer construction in wonderful Sewickley neighborhood. 2 acre private lot. Fully-equipped newer kitchen with custom cabinetry, high end appliances including Sub-Zero, Wolf range, double ovens and Dacor warming drawer open to great room and amazing three season porch with impressive stone fireplace. Mudroom access to attached four car garage. Upper level laundry. Incredible master suite w/ spa-style luxury bath plus three additional bedrooms and three additional baths. Fun for all in the lower level with home theater, game room, exercise studio, full bath and indoor “endless” pool. $1,450,000    Learn More…

 

439 Maple Lane

Its time to think summer!  It might be cold outside, but come spring you will love the endless hours of family fun you can have in this incredible pool complex!  Heated pool, hot tub and bar will make your new home party central! A top-to-bottom remodel of this timeless Edgeworth colonial, with gorgeous new white kitchen with granite tops open to stunning dining room.  Hardwood floors unify great room, study, entry hall and mudroom. Up to eight bedrooms, 4.5 baths, 3 car detached garage. $1,421,000     Learn More…

I’m ready to answer any questions you have regarding your real estate needs.
 
 
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

Giving Thanks

This time of year we all take the time to give thanks for all of the wonderful things in our lives.  I have much to be thankful for.  The obvious chart toppers are good health, wonderful family and friends, and a warm home to come home to each day (which I particularly appreciate on these chilly November days!)  My gratitude extends much further, however, to all of the people I work with every day that make real estate transactions so seamless for my clients – from the best mortgage brokers and closers to incredible home inspectors and handymen, contractors, electricians, roofers… that I can count on to give their best to my clients.  With them by my side (or on speed dial) I have been able to provide the highest level of service to those with whom I work, and for that I am grateful.

My gratitude, however, extends even further – to forces I can’t control.  We have been very fortunate to have historically low interest rates for a very long period of time (and even though they have been inching up, they are still comparatively quite low), and a taxing structure that has favored home ownership as an investment.  I am always reminded that Uncle Sam, through the mortgage interest deduction, effectively pays a portion of my mortgage every month. Through the system as structured, we are not only able to own homes for less than we could pay to rent them, but at the same time we are building equity which will be there for us when we retire and are seeking that nest egg to purchase our retirement home with.

Are you taking advantage of all that is available to you?  It’s hard to imagine that there will ever be a better time to begin or increase the size of your nest egg in real estate.   If you’re ready to downsize and cash in your nest egg, it’s an absolutely ideal time – inventory is low, interest rates are still on the historically low side and we have buyers waiting in line for Sewickley homes.  The spring market starts in January – the time to sell is now!  Enjoy your holiday, and give thanks for all that is wonderful in your life!

A New Home for the Holidays

907 Nevin

Where else in Sewickley can you get an essentially new home with 4 bedrooms, 3.5 baths AND a 2 car garage for under $400,000?!  Top to bottom renovation to this adorable Village home! 4 bedrooms, 3.5 new, stylish baths, 3 finished levels, new 2 car garage. Incredible open floorplan unified by new hardwood floors.  New kitchen with white cabinetry, granite tops, stainless appliances. Doors open to large and inviting, private rear deck.  Move right in and enjoy! $389,000  Read More….

 

319 Scaife

Exceptional Sewickley Heights home will take your breath away with its unparalleled beauty. Sited on 5 private acres, it combines the authentic charm of a Sewickley Heights carriage home with modern amenities and stunning design.  Magazine perfect kitchen with top-of-the-line appliances and granite tops opens to a captivating dining room with fireplace and relaxing family room.  French doors open from the gorgeous living room, also with fireplace, onto the sprawling stone terrace, which spills out effortlessly onto the manicured grounds.  Enjoy coffee or wine relaxing under the wisteria-draped trellis. Incredible master suite with three walk-in closets and remarkable custom bath with radiant floors, Victoria and Albert soaking tub and large shower with custom glass enclosure.  Charming enclosed courtyard. Three car attached garage.  $2,150,000    Read More…

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

The Almost Perfect Home

We have been searching for our new Sewickley home for about 9 months with no luck – there doesn’t seem to be much of a selection and we cant find our perfect home – any advice for a family of weary home lookers?

Sewickley is a small town which makes it a unique and wonderful place to live, but with it’s small town appeal comes a definitely smaller number of homes to begin with and yes, in some price brackets, inventory has been far tighter than it has been in the past. It is beginning to feel like Sewickley is such a great place to live that no one wants to move!

When we moved here 25 years ago from D.C., we had a long list of “must haves” that we searched the greater Pittsburgh area for. Our real estate agent showed us only one home in Sewickley – that’s all that was available in our price range at that time! It met very few of our must haves – it did not have a master bedroom, it did not have a two car garage, it did not have central A/C and it did not have a family room. But it did have tree lined streets and sidewalks to everywhere and that was our #1 criteria, so we bought the home despite all of its perceived shortcomings.

In the intervening years (and in the two Sewickley home purchases we have made since then), I have learned that if one wants to live in Sewickley, he or she will ultimately need to bend on the must haves a bit. Price will not help – no matter what the price point, there are simply no perfect homes. It is important to evaluate each home through a slightly different lens. Consider how close a possible home comes to meeting your needs. If it meets about 80% of your “hope to haves” and if you could change another 10% over time to be much closer to what you hope to have, with the remaining 10% being things you wish you could change but realistically cant and will have to learn to live with, then the home is likely a home run and one you should seriously consider buying. I call this the 80/10/10 rule – and I have observed that once buyers come to terms with this concept, they can finally find their place to call home. Those that hold out for “perfect” – looking for the home that meets 90%+ of their hope to haves – will find themselves sitting on the sidelines as one home after another sells – that needle in the haystack simply does not exist.

And so, for example, if you have found a great home with the space you need that is in terrific condition in a nice neighborhood and with a great yard, but you don’t love the kitchen and you think it is a bit too far from Starbucks, give it another look. 80% is likely a yes. The kitchen (10%) can be changed over time. And you can learn to adjust to the extra ½ mile to Starbucks – its still walkable! My best advice to you is to start looking at homes through this 80/10/10 lens – you may be surprised to find that “perfect enough” has been waiting for you all along!

63 Thorn Street

Expertly remodeled, 63 Thorn paints a modern landscape on a charming traditional palate to create an exceptional home for the millennium home buyer.  Sited on a large lot with fully fenced back yard. The expertly designed and crafted kitchen (which is open to the kitchen) is flooded with light from an entire wall of windows that bring the private backyard into this warm and inviting space.  The dining room has also been opened to the back yard through an impressive wall of windows and doors, and spills effortless out onto the new back deck.  The second level is home to a new master suite with large closet and spa-like private bath.  Four additional bedrooms, two full baths and a convenient second floor laundry room complete the upper levels.  $1,595,000 More Info Here…

219 Orchard

A spectacular Sewickley Village transformation!  Large two-story addition of 1000SF+ incorporates a new large family room, mudroom and luxurious master suite. This complete renovation included all new wiring, zoned central A/C added to the home, 2.5 new baths including a gorgeous master bath, addition of main level laundry and new kitchen featuring abundant white cabinetry topped with Quartz, stainless appliances, and large center island overlooking the large great room. New master suite includes vaulted ceiling, spacious walk-in closet with laundry chute, Fenced rear yard with patio. $599,000 More Info Here…

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

The Inspection “Hot Potato”

As a home seller, are there inspection type items that we are simply going to be stuck addressing?

Who can forget the old childhood game – pass the hot potato?  The object, of course, was to not be holding the hot potato when the music stops.  We have our fair share of “hot potatoes” in real estate too, and just like in the childhood game, someone always gets stuck holding the hot potato.

You may wonder, what are these hot potatoes of which I write?  Years ago, it was radon.  If you were selling your home and it had radon levels in excess of the EPA limit of 4.0 pCi/L, you got stuck paying the remediation bill (usually less than $1000) because a buyer isn’t going to agree to buy a home with a radon problem.  That hasn’t changed, but if a home has sold in recent years and ever had radon, chances are it has been remediated.

Next, the media exploded with stories of illness caused by mold in homes and suddenly, sellers were faced with mold inspections.  There is the very bad black mold (Stachybotrs), but honestly, all molds have the potential to make you sick.  As you can imagine, buyers aren’t going to buy a home with a mold problem either, and once again, the seller bears the cost of remediation and often, the cost to solve the cause of the mold problem as well. The cost can be several hundred to several thousand dollars.

These days, the hot potatoes have expanded to include two tricky electrical issues.  Pushmatic electrical panel boxes are very expensive to maintain and the manufacturer is no longer in business.  Most buyers will require a seller to replace these panel boxes – the cost per panel is generally $1500+.  Knob and tube wiring is the other big hot potato for homes built before 1930.  Rewiring an entire home can range between $10,000 – $20,000 and so many homes retain this original wiring.  Most insurance companies will no longer issue new insurance policies on homes with this antiquated wiring.  Therefore, if knob and tube wiring is discovered on an inspection, the cost of the rewire also generally falls to the seller – very few buyers are willing to buy a home (at least not unless they are getting a substantial discount) if it has knob & tube wiring present.

If you own a home with one of these hot potatoes – radon, mold, pushmatic panel or knob & tube wiring – things that years ago wouldn’t have raised an eyebrow – you should expect that when you go to sell your home, you will be stuck with the cost of getting rid of the hot potato, if you haven’t already done so!

907 Nevin

Fantastic remodel at a great price! Top to bottom renovation to this adorable Village home! 4 bedrooms, 3.5 new, stylish baths, 3 finished levels, new 2 car garage. Incredible open floorplan unified by new hardwood floors.  New kitchen with white cabinetry, granite tops, stainless appliances. Doors open to large and inviting, private rear deck.  Move right in and enjoy! $399,000  More Info Here…

319 Scaife

Exceptional Sewickley Heights home will take your breath away with its unparalleled beauty. Sited on 5 private acres, it combines the authentic charm of a Sewickley Heights carriage home with modern amenities and stunning design.  Magazine perfect kitchen with top-of-the-line appliances and granite tops opens to a captivating dining room with fireplace and relaxing family room.  French doors open from the gorgeous living room, also with fireplace, onto the sprawling stone terrace, which spills out effortlessly onto the manicured grounds.  Enjoy coffee or wine relaxing under the wisteria-draped trellis. Incredible master suite with three walk-in closets and remarkable custom bath with radiant floors, Victoria and Albert soaking tub and large shower with custom glass enclosure.  Charming enclosed courtyard. Three car attached garage.  $2,150,000 More Info Here…

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

OFFER IN HAND? Better Move Quick!

We received an offer on our home but would like time to figure out where we are going next before we respond.
Is that reasonable?

Momentum is important in life.   We learn this lesson early on.  As a child, you learn that the likelihood of a getting that candy bar in the grocery store is at its peak the moment after you ask.  You are willing to give more to get in those initial moments – you might have offered to clean your room if you could just have that candy bar. The parent also knows that she can get more initially in exchange for that candy bar – your interest will wane if she doesn’t take advantage of your interest at that moment.  That lesson continues throughout life.

And so it is with real estate.  Sellers who respond and negotiate quickly to offers are far more likely to catch a buyer in the heat of the moment and achieve a higher price.  If a buyer is given too much time between the time their offer (or later counter offer) is made and the time they hear from the seller, they are far more likely to rethink their willingness to pay more, or perhaps even their interest in buying at all.  By dragging their feat in responding, in over-analyzing whether they will achieve a higher offer later, or whether they can live with the buyers terms as proposed, many sellers leave thousands of dollars on the table that they could have captured if they had just negotiated with haste.

A failure to respond quickly also increases the risk that a buyer will be distracted by another listing.  One of my favorite true stories is the buyer who signed an offer on a Saturday – the seller was too busy to meet with their agent and review the offer until Monday evening.  As luck would have it, another property came on the market Monday morning and by the time the seller responded (on Monday evening) to their Saturday offer, the buyer had made an offer on and fully negotiated the purchase of a different property.  That seller waited 9 more months for the offer they finally accepted at $55,000 less than the offer they were too busy to hear.  Sellers, don’t make these mistakes!  When you are fortunate enough to get an offer, respond and negotiate quickly for your best chance at a good result.  If you are not sure where you will go next, there is always the possibility of a rental, which is likely a better option than losing a good buyer.

FEATURED HOMES

 

219 Orchard

A spectacular Sewickley Village transformation!  Large two-story addition of 1000SF+ incorporates a new large family room, mudroom and luxurious master suite. This complete renovation included all new wiring, zoned central A/C added to the home, 2.5 new baths including a gorgeous master bath, addition of main level laundry and new kitchen featuring abundant white cabinetry topped with Quartz, stainless appliances, and large center island overlooking the large great room. New master suite includes vaulted ceiling, spacious walk-in closet with laundry chute, Fenced rear yard with patio.  $629,000

 

625 East

The opportunity of a lifetime! All of the elements of the ideal Village experience merge beautifully in one home! Tastefully remodeled, elegant yet comfortable! Located on one of Sewickley’s finest streets. Built and maintained with impeccable attention to every detail. Richly appointed throughout. Beautiful kitchen loaded with amenities. Private study with richly molded walls and handsome wood-burning fireplace. Family room/morning room with arched windows flood the room with light. Restful owners suite with luxurious his and hers baths. Amazing dressing room with mahogany center island. Four to five additional bedrooms, three laundry areas, finished lower level with game room and home gym. Two-car garage with bonus room above. Beautiful, private grounds with large stone patio. $2,800,000

 

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

THE RISING INTEREST RATES vs. HOUSING MARKET

What impact do you think rising interest rates will have on the real estate market?

I can’t tell you how many years the Fed has been warning us that they are going to raise the interest rates, and then nothing happened. But now, it looks like it is finally happening. Less than one year ago, conforming loans with good credit could be procured, on a good day, at rates below 3% fixed. Now they have inched up to 4.25% for conforming loans and 4.75% for jumbo loans. While these are still historically great rates, the days of mortgage interest rates in the 3% range appear to be gone and we are slowly inching toward 5%.

What impact will this have on the market? Typically, when rates increase the market slows. Buying power decreases – a buyer will qualify for a smaller mortgage amount when rates are higher. Even if a buyer qualifies for a loan amount, they may not want to pay the added amount each month attributable to the higher rate. Many buyers are cognizant of how much they don’t have available to spend on quality of life purchases, such as dinners out, when they have larger mortgage payments. This boils down to the fact that they may be unwilling or unable to buy at a price they could have last year, and this could depress housing prices.

However, this is counterbalanced by the fact that we are in a market with record low levels of inventory, so it is highly unlikely that interest rates will have any effect on housing prices in the short run. If anything, rising rates should cause buyers to move quickly and lock in homes and mortgages before rates continue to climb. And this would be the most sensible short-term response to rising rates. Buyers – rates are actually going up! The time to act is now!

FEATURED HOMES

73 Thorn Street
NEW LISTING — A wonderful renovation of this classic Sewickley Village Victorian! Offering modern amenities yet loaded with charm, you cannot beat the central Village location! Original details, including beautiful mantles, handsome moldings and a striking staircase anchor the home in history and balance the newer kitchen with stainless and granite and 4.5 newer baths, creating a home that seamlessly merges the past with the present. In addition to generous living and dining rooms and kitchen open to family room, the main level features a convenient laundry room. The upper two levels are home to five bedrooms plus two dens. The covered back porch is perfect for relaxing on warm evening and flows effortlessly onto the large lawn. Two car garage. Please join me for my open house Sunday, 1-4pm at 73 Thorn Street, Sewickley. $1,225,000

1 Oak Drive
NEW LISTING – Well-maintained brick Tudor-style home close to Sewickley Village. Spacious floor plan. Thoughtfully updated with quality renovations that have maintained the home’s character and original workmanship while including the desired modern amenities. Remodeled and expanded kitchen features custom cabinetry with granite tops, stainless appliances. Convenient mudroom. Three bedrooms including master and two remodeled baths. Lower level family room. Two-car garage, plenty of outdoor space including the charming brick patio! $475,000.  See More… 

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

WHEN CAN WE MOVE IN?

When we buy a new home, when can we expect to be able to move in?

The answer to your question varies from state to state.  In Pennsylvania, possession transfers immediately at closing!  How does this impact the buyers and sellers?

Sellers, you must be completely moved out before closing day.  The latest day your movers should come is the day before closing.  You need to be sure to leave enough time to clean the home after they leave.  If you don’t already own your new home and plan to close on it immediately after closing on your old home, you need to plan for your movers to store your things on the moving van overnight.  However, it is generally smart to move out a couple of days before closing, to make sure that you have time to clean and dispose of any items the movers didn’t take.  Its not acceptable to leave things you don’t want behind for the new buyers – if you don’t dispose of them yourself, there is a good chance you will have to provide funds to the buyer at closing to get any remaining items removed.

Buyers, you can start your move in as soon as you pay for the home and finish signing your closing documents!  It is not, however, ok to start moving in before closing or to start making repairs and improvements before closing.  Both of these scenarios create insurance (and other) issues for the seller.  Please plan accordingly – if you need time to renovate before moving in, plan for storing your items with your mover until your work is complete.  Properly advise your movers of the closing time so that they are not counting on starting the move-in early.

Your one hour closing is the time that everything transfers – keys, responsibilities for upkeep, taxes… Sellers must be completely out as of that moment and Buyers may enter once that moment has passed!

FEATURED HOME

137 Sebago Lake Drive 

Absolutely perfect inside and out with stylish design aesthetic. New roof, new gutters, new flashings,  new windows, new landscaping, new sprinkler system, new lighting, new HVAC.  Custom, all brick loaded will amenities. Stunning views of Diamond Run’s 6th fairway & green. 4BR, 4+4 baths, 3 car attached garage, finished walk-out lower level. $895,000   See more photos and details here….

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

THE HOME INSPECTION DILEMMA

We are buying a new home.  Can we skip the home inspection and save a few bucks?

I do not recommend that you skip a home inspection, even with a new home.  Please keep in mind if buying a new home that no matter how nice and reassuring the builder or his realtor representative are, they do not represent you!  I have on many occasions witnessed a builder trying to gloss over obvious deficiencies with new homes.  You need a home inspector to carefully assess your new home so that you aren’t burdened with repair bills later for improper conditions that existed at the time of your closing. While the inspector is there, it’s a good idea to get a pest and radon inspection in addition to a general home inspection.  Both pests and radon are commonplace and can be significant – its wise to know what you are dealing with before you move in.

However, do not make the mistake of assuming that all home inspectors are equally skilled at their profession. Some inspectors gloss over many areas of concern and take a VERY big picture approach, which, while generally not alarming, can also be very unhelpful as you plan for your future improvements to the home.  Others can be incredibly harsh and point out flaws that are inaccurate or irrelevant, leading you to over-react. Before booking a home inspector, do your due diligence – make sure they are ASHI certified  and read their online reviews (as you I am sure you did when you chose your Realtor).

Finally, once you move in, keep in mind that it is recommended that homeowners have their homes professionally inspected once every ten years.  The mere passage of time can take a toll on a home, and better that you find problems and correct them before they become big problems. Repeating pest and radon inspections at that time is also a good idea – they are also best addressed sooner rather than later.  If you have any questions about whether you should be getting your home inspected, please give me a call!  412.779.6060

RECENTLY SOLD — represented buyers.
Click the photo to see more of my past sales history!

 

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

TO TUB or NOT TO TUB, That is the question.

Both our bathrooms have claw-foot tubs which I am thinking of replacing with walk-in showers.  What is the value of having a tub in the bathroom in place of a shower or in addition to a shower?

Every home must have at least one bathtub.  A prospective buyer might have kids or just like a good soak and many will reject a home if there isn’t a tub available.  More often than not, if there is only one tub in a home it is in a kid’s bathroom, and this is most commonly configured as a tub/shower combination.  There could be a tub in the master bathroom as well, but only if there is abundant space. If you have to choose between a large, luxurious (spacious) shower in the master or a tub/shower, ditch the tub and go for a pure shower.  If there are multiple kids bathrooms, then only one needs to have a tub.  Typically, that tub is not a claw foot tub unless it has a shower ring (which is not tremendously appealing).  When claw foot tubs remain, they are typically in a bathroom that has plenty of room for both a shower and a tub. Re-glazed, these antique tubs can be the focal point of a remodeled luxury bath.

As far as value goes, value is really only recouped if you remodel the entire bathroom.  In other words, if you put in a new shower but leave the old floor tile and old vanity, you really have added no value.  If you redo the whole bathroom, you will likely recoup more that what you pay to remodel the bathroom, as long as you shop smartly when doing your remodel and sell your home while the bathroom still feels current (under 15 years). It is also very important to make choices that are classic and stand the test of time if you don’t want your home to feel dated sooner rather than later. I suggest, given the age of your home, that you make classic choices — Carrera marble, white subway tile, and silver-tone fixtures would all be timeless choices appropriate for an historic home.

Of course, I am available to provide on-site advice if that would be helpful to you as you have many options – give me a call – I’m happy to provide my free advice!

FEATURED HOMES

316 Beaver Street #204  

Luxury and convenience seamlessly blend in this chic central Sewickley Village condo. Just steps to the shops and restaurants, this beautifully renovated unit features 2 bedrooms, 2 baths, large living room with built-ins, dining room, family room, eat-in kitchen and private balcony.  In-unit laundry plus 2 indoor parking spaces.  New hardwood floors unify the living spaces. $435,000.  See more… 

 

102 American Way

The living is easy in this absolutely wonderful Sewickley Ridge one-level townhome.  Located in Ohio Township’s highly popular and sought-after Traditions at Sewickley Ridge community, it is less than one year old and in move-in condition – ready for you to call home!  2 bedrooms, 2 baths, 2 car garage, open concept floorplan, delightful screened porch. Chic ascetic with white cabinetry, granite tops, hardwood floors. Why delay your downsize any longer? $389,000   See more…

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

THE “JOYS” of SELLING

Selling a home can be a trying process.  They say forewarned is forearmed. Any annoyances a seller should be expecting?

Below is a short list of many of the “joys” sellers might experience during the listing process.  Being aware that these are possibilities will hopefully help you take them in good humor if they happen to you!

  • The agent showing your home will miss appointments and not call or show up.
  • Appointments will be made and cancelled at the last minute.
  • Some showings will last about five minutes and some will last 3 hours.
  • There will be a day when I call you and say someone wants to see your house, and you are going to ask me when. And I will say: “Look out your windows, they are sitting outside now”!
  • Agents are going to knock on your door or even drive by, see you in the yard and ask if can they see you house.
  • Agents showing your home will forget to turn lights off.
  • Agents showing your home will let your pets out (best to remove them from your home for showings) or your neighbor’s pet in.
  • Agents will provide unhelpful feedback – buyers buy homes when they attach emotionally to a home and when they don’t, their feedback is often nonsensical.
  • Agents will not provide any feedback – incredibly annoying, I know.
  • The agent on the sign will be in witness protection and not return any phone calls.
  • Expect lowball offers (at least it is a starting point).
  • Things will come up on the inspection that you had no idea were wrong with your home and you will be sure the inspector made a mistake.
  • The buyer will make ridiculous inspection requests.
  • The buyer will ask to bring in contractors for estimates for work they want to do after the closing at the seemingly most inconvenient times.
  • The property might not appraise at what you are selling it for.
  • The closing date on the contract may change.

FEATURED HOMES

7 Harvester Court

Tired of looking at one “project” after another for a home that is “move in ready”? Your search is over!  This custom-built all brick colonial was just renovated with 3 new luxury baths, newer kitchen, new roof, new HVAC, new deck, new paint in modern aesthetic and more. Totally turn-key for you and your family! 4 bedrooms, 3.5 baths, 3 car garage, finished walk-out lower level, nearly 2 acre lot. $775,000. Get more details and see more photos…

141 Beech Ridge Drive

Spectacular 22,000+SF estate nestled on 8 private acres in Sewickley. Remarkable newer custom construction.  Half-court indoor basketball court, full racquetball/squash court, complete locker room facilities including sauna, 60’x30’ heated in-ground concrete salt water pool w/ stone waterfalls, patio w/ outdoor fireplace, 5 bedrooms, 5 full & 4 half baths, 9 fireplaces, 6 garage spaces, two kitchens, wine room, roof-top observation deck, new home theater.  Simply remarkable! $4,500,000  See More Photos & Details…

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
HOWARD HANNA
REAL ESTATE SERVICES
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
kbarge@howardhanna.com

For What It’s “Worth”…

In your May 11th article, your first item you noted about real estate is that a home is worth what a buyer is willing to pay.  I thought a home is worth what it appraises for?”

In my May 11th article (available to those of you who missed it on my website), I did list 12 important things everyone should know about real estate, the first being that yes, a home is only worth what a buyer is willing to pay.

Appraisals are typically done in conjunction with a mortgage application, although they are sometimes done as part of an estate administration or by a homeowner who wants to get a better sense of what a home is worth.  Many appraisers are not experts in the neighborhood they are trying to appraise a home in and miss the block by block nuances that greatly affect value.  However, even if they are well versed in a particular area, they may not have been in every home and may not understand the special circumstances surrounding why one buyer may have paid a premium and another buyer may have purchased at a discount.  Appraisers often don’t have their finger on the pulse of buyer expectations – unlike Realtors, they do not interact directly with buyers and don’t have the opportunity to hear them complain about wallpaper, colored carpets, dated lighting and outdated kitchens and baths.  They don’t see firsthand how eager buyers are to purchase newly remodeled homes and the premiums they will deliver for those homes and they aren’t privy to the conversations Realtors have trying to convince a buyer to take on a project. So sometimes they are just too high and that price will not be achievable absent a sizable remodel.

It is also irrelevant how much money a seller has invested in a home.  It is important to keep in mind unless renovations were made in conjunction with a home-staging professional in an effort to sell your home, improvements were made for the homeowner’s enjoyment and may not carry any value for a home buyer.

In the end, Buyers in 2017 America are quite savvy.  Most view all inventory for many months before choosing a home.  They probably know better than a home seller how a home stacks up against what has recently sold.  If they don’t, it is all readily available online.  So in the end, the price is determined by how convinced a buyer is that the value is in the home.

FEATURED HOMES:

7 Harvester Court

7 Harvester Court

 

Beautifully remodeled custom built home offers 3 new luxury baths, newer kitchen, new roof, new HVAC, new deck, new paint in modern aesthetic and more. Totally turn-key for you and your family! 4 bedrooms, 3.5 baths, 3 car garage, finished walk-out lower level. $775,000.

 

 

 

1008 Beaver Road

1008 Beaver Road

Less than .5 miles to central Sewickley Village yet sited on private 4 acre lot. Inside, discover a modern  home with beautiful finishes. Stylishly remodeled kitchen w/ Subzero fridge, Viking professional range, charming butler’s pantry. With six bedrooms, two home offices, a formal study, cozy family room with fireplace, living room with semi-circular bay window, sunroom, enormous recreation room/gym, and a 2 attached car garage (and much more!), this home is a show stopper!  $1,950,000

 

 

 

 

As an Associate Broker at
HOWARD HANNA REAL ESTATE SERVICES,
Kathe Barge, CRS, ABR, CNE, is ready to answer any
questions you may have regarding your real estate needs.  Feel free to contact her at the office (412) 741-2200 x238or on her mobile phone (412) 779-6060.

Waiting for “Mr. Right”

Will there be more homes coming on the market soon? We’ve been looking for a while and it doesn’t seem like there are many homes available.

Our inventory of available homes has never been lower! And yes, there will be more homes coming on the market soon. I have many wonderful homes almost ready to enter the spring market – sellers working hard to make their home appealing to you. But don’t expect an avalanche – I fully anticipate that there will be fewer than usual homes coming on the market this spring. And with the coming of the spring market there will be many more buyers, much more competition, and a rise in the prices realized by sellers. The window is almost closed for buyers to be able to get a good deal this spring from a seller anxious to sell. Buyers will soon find themselves in bidding wars, in many cases for homes they could have purchased a month earlier at a discount.

Will your perfect home be one of the ones coming on the market in the coming weeks? There is always that chance, but if you are looking for that historically charming Village home that has 4 bedrooms, 3.5 baths, a two car garage with modern kitchen and baths, a gray/greige color palette, and a yard big enough for fun… get in line! There is a large crowd of people waiting for that product and you are well advised to be pre-approved by a lender and ready to put in a strong offer very quickly, with no guarantee you will be the winner. Another reasonable alternative is to reconsider what we have on the market – there are many terrific homes that with a little effort, could be your dream home.

Why is inventory so low? Here in Sewickley, our community’s popularity is growing every year. The school district continues to garner accolades and rank highly and the secret is out – this is a super cool and fun place to live that is really close to both Pittsburgh and the airport. Why not Sewickley? So as more people try to find a spot here and fewer people depart, fewer and fewer homes are available for sale. The scarcity of homes will continue to put upward pressure on prices. And of course, if your priority is a home in Sewickley, you may just need to consider where you can compromise to make your dream a reality!

Financing Your Buy Before You Sell

What financing options exist for transitioning between homes if we don’t have to sell our current home to buy our new one and our objective is to remain debt free when the transition is complete?

The process of selling one home and buying another often feels like there are many moving pieces. If you are fortunate enough to be able to buy a new home before you sell your old home, you have put yourself in a wonderfully strong position as a buyer to be able to make an offer on a new home that is not contingent on your old home selling. As we enter what will be a very strong spring market, that will be a big advantage for you!

You have a variety of options on how to pay for your new home. Perhaps you have cash – but with the recent run up in the stock market, this may not be the best time to liquidate your investments.

A particularly affordable alternative might be to put a home equity line of credit (“HELOC”) on your current home, IF you have enough equity in your current home to provide the cash you need to buy your new home. HELOCs tend to involve very low costs to the borrower up-front. They can also remain untapped until you need the money, so you are not paying any interest charges while you are searching for your new home. You can pay the HELOC off as soon as your old home sells, leaving you with less debt (or possibly none) on your new home. Finally, it is something you can arrange for now and be well positioned to jump on a great home when one comes on the market.

Of course, being able to buy without selling may mean you can qualify for a traditional mortgage on your new home. Whether this is the right choice for you will depend on whether and how much debt you want to end up with in the end. If you need a large amount of cash upfront but ultimately would prefer to carry a smaller mortgage (or no mortgage) once your old home sells, consider financing through a combination of loans and pay the second loan off when your old home sells, leaving your with only the first mortgage in the smaller amount. If you intend to carry no debt, there are products with low upfront costs that you can pay off as soon as your home sells.

There are many options to consider when creating a plan that to achieve your long term financial goals – give me a call and I can connect you to trusted financing providers who can help you develop a solid startegy before you find your dream home!

Who Represents You?

Can we choose a buyer’s agent even if we have seen homes with the listing agents?

The answer is an unequivocal yes! As a buyer, you are absolutely entitled to choose your own representation in a transaction. It might be that the listing agent is in fact the individual that you feel will best represent you – approximately 1/3 of my transactions involve dual agency, and they proceed smoothly for all parties. But if you have been looking at homes or going to open houses and find the perfect agent for you in that process, it is fine to engage that agent as your representative even if you have seen homes with other agents.

It is of course in your best interests to ultimately select and work exclusively with a buyer’s agent. Your buyer’s agent should provide a personalized high level of service to you. When viewing homes, you should expect your buyer’s agent to provide you with information about the home, neighborhood and community to help you in your decision making process. You should expect your buyer’s agent to provide you with an analysis of comparable sales, develop a negotiating strategy and help you analyze and negotiate the home inspection. These are important benefits that you will receive when you engage a buyer’s agent that cannot be provided in the absence of that relationship.

Many buyers use open houses and viewings with listing agents as their opportunity to interview agents and determine who will best represent them as a buyer’s agent. This makes complete sense if you do not have a prior agency relationship that you were pleased with. Transitioning between homes is a very personal process that can, for some, also be very stressful. For many of us, it also involves the purchase and/or sale of our largest asset. The importance of due diligence, reference checking and interviews cannot be overstated when choosing your real estate representative, and once you have made that decision, it is important to communicate that to other real estate agents when interacting with them. I will be hosting an open house this Sunday, 1-3pm, at 30 Wilson Drive in Ben Avon Heights and next Sunday, February 5, 1-3 pm at 1008 Beaver Street in Sewickley – stop by, check out these amazing homes, and if you don’t already know me, I would love the opportunity to meet you!

New Years Resolution #1

If there was one thing you would advise us to do to our home this year, what would that be?

Whether you are planning to sell your home this year or not, the best thing you can do to your home this year is a home inspection! We all live in our homes but rarely take the time to stop and give them a careful look. Weather beats up the outside of our homes year round. Caulking fails, flashing fails, paint peels and exposes wood to rot. We forget to clean our gutters on a regular basis – gutters and downspouts fill with decaying debris, causing water to back up into our homes and cause mold problems. We forget to have our furnaces serviced and fittings loosen and cause condensate to leak and rust our furnaces. The list goes on and on. Simply living in and not doing a regular check up on your home, you are leaving it open to the possibility of major repair bills later and major depreciation in your investment’s value. A home inspection will give you a to do list of projects to tackle throughout the year to keep your home in great shape and maintain its value!

You may not think about this until you go to sell your home. Some of the wear and tear may be obvious to a buyer, who will typically have checked out every available home, be able to see signs of your “benign neglect,” and pass on yours because of its comparatively negative condition. Even if a buyer doesn’t’ notice at first, there is no doubt that a home inspector will notice! After working hard to get your home sold, you may find yourself in the all too common situation of being presented with a long list of inspection requests that you need to complete in order to hold your deal together, or worse yet, a buyer who backs out of your deal because the house needs “too much work,” leaving you in the position of having to fix everything and start all over again. A homeowner should expect simply keeping a home in acceptable condition will cost them $3,000 – $10,000 a year, depending on the size of the home – some years wil be more if its time for a major project, and some less. If you’re not investing this, chances are someday you will when you are faced with a long list of inspection issues.

The first thing on my household resolution list this new year is a home inspection and I suggest you add it to the top of your list as well. Give me a call if you need the names of reputable local inspectors.

Selling During the Holidays

The holidays are here and our home is on the market – any tips for selling during the holidays?

The holidays can be a challenging time to sell your home – the number of people looking for a home is much lower than almost any other time of year. But those who do look around the holidays are usually very serious buyers and so it is worth making sure that your home presents as well as possible.

Start with a good fall cleanup! It’s definitely time to put your yard to bed! Make sure your yard is well raked and all dead plants removed. Curb appeal is even more important in colder months when the landscaping is less lush and appealing to a buyer. Make sure gutters are cleaned and everything outside is looking crisp.

Make sure you keep your thermostat up for showings – walking into a cold house for a showing can be a real turn-off. Warmer homes will cause buyers to linger when its cold outside – which will allow them time to admire your home’s wonderful amenities.   And of course, with as gray as Pittsburgh can be in the winter, be sure all of your lights are on for showings (and that you have working lightbulbs in all of the lights). Its also a good idea to put a few lights on timers if you are away so the home always looks cheerful from the street.

Holiday decorations always add cheer to a home, but be careful not to overdo it! Keep your decorations this year on the more minimal side, and try to avoid religious themed decorations. Be sure that you de-clutter BEFORE you decorate and also be sure that your decorations coordinate well with your décor scheme. And of course, avoid large inflatables in your yard!

Finally, don’t forget that if it snows, you must keep your driveway and walk clear of snow so that the buyers can easily get inside

The Million Dollar Question!

Do you have any thoughts as to how the election will affect our housing market?

That is the million dollar question these days!

The quick answer: in the long run, I don’t expect it will have any effect. Real estate is very local. What happens in one part of the country often has nothing to do with what happens elsewhere. Pittsburgh tends to be a more cautious market. Our prices don’t escalate quickly and they also didn’t plummet after the recession. We have seen a very slow and steady upswing in our prices and I expect that to continue – because it is slow and steady, as Pittsburgh has always been.

Our sales have, however, came to a near standstill in recent weeks. But the elections are over and we have a new President elect – so where does that leave us?

When it comes to the real estate market, it really doesn’t matter who you voted for or what you think of the election results – it is common when there is an anticipated change in leadership for our real estate market to slow down. And so I expect, as has happened in prior leadership change years, that our real estate sales will be very slow from now until after Inauguration Day. Cautious Pittsburghers will be interested to see who is chosen to fill cabinet positions and what plans are laid out for the coming years. Home purchases are a big event in most people’s lives and they will want a greater sense of certainty before they make a big change like a new home. And then I fully expect, as has been the case with other elections, that normalcy will return to our market.

Because I expect the next three months to be slow in real estate sales, I do expect that will lead to a pent up demand and a strong spring market. If you are thinking of selling, now is the perfect time to put together a plan for selling your house this spring. The election is over and you can be certain one thing will not change – I will still be here selling houses for you!

Why Buy Now?

Dear Kathe,

Why should we consider buying now? Isn’t it better to wait until spring?

This fall, the market has been a bit sluggish, perhaps led by election anxiety, and now the holidays are quickly approaching. We are, however, expecting a very strong spring market. The millennials are expected to make a huge impact on our housing market this spring. Over 50% of home purchases are projected to come from first time home buyers. Many millennials are moving into their first homes, many are moving out of apartments and/or out of cities to a more “family friendly” environment. Sewickley , a walking community that has become so very popular in millennium America, is well positioned to see the impact of that surge.

This expected demand is going to put incredible pressure on our spring market. It is anticipated that prices will be increasing and bidding wars will become commonplace. All of this suggests that now is the absolute best time to buy if you are thinking of moving! There are very few people who buy this time of year, as most are too preoccupied with getting ready for the holidays. While inventory is lower than it will likely be come spring, the absence of many buyers gives you a much better chance to strike a good deal. Why pay over asking price in a bidding war come March when you could negotiate a discount now? Rather than putting yourself at a competitive and financial disadvantage, start the home search process now.

And of course, if you are thinking of selling, carve out some time this fall to prepare yourself for a spring introduction in January/February. Market trends show that the sale surge happens in March, not April, so you should be getting ready now! If you will be selling a starter home (which here can be up to $500,000) and are well prepped and well priced, you should expect a positive market response and maybe even a bidding war!

Selling Your Vacant Home

Dear Kathe:

We may move out and leave our home vacant and for sale – is there anything special we should know?

First and most importantly, you must consider your insurance coverage. If you have a loss and you have not notified your insurance company that you have vacated the home, they may deny coverage for your loss. Some companies may not provide coverage for your vacant home and you will need to switch insurers. Some will provide coverage for a limited amount of time, and some will provide coverage as long as you leave your furniture in place. However, most will deny coverage for any loss related to water, so whenever you leave a home vacant for any amount of time, its important to turn the water off at the main. If its winter time, you should consider having a plumber professionally winterize your home.

Second its rarely a good idea to leave a home totally empty. Some homes do show better without the owner’s furniture, but even in those cases its important to leave bathrooms, the kitchen, fireplace mantles… staged so that the home feels loved and inviting to prospective buyers. Be sure to have a few lights on timers – buyers often drive by homes at night and you don’t want yours looking haunted! Of course, there are professional home stagers that can help you with any level of staging, whether its working with your existing furnishings, accessorizing bathrooms and the kitchen, or bringing in new furniture to fill the empty space.

You should have a house keeper who comes monthly to keep the home fresh and bug free and a yard service to keep the yard freshly mown and free of weeds, as well as leaves rank and snow shoveled. Finally, you should be sure to keep the temperature set at a comfortable temperature – in the winter no lower than 60 degrees and preferable 65 degrees.

Leaving a home vacant certainly makes showings easier, but it does require some extra attention to make sure the home does not feel abandoned and remains appealing to prospective buyers!

Will Our Deal Close?

Dear Kathe:

What assurances are there to a seller that if they enter into a contract to sell their home, it will actually close?

Reaching an agreement on the sale of your home is an important first step to getting your home closed. However, before a seller has any assurance that a home will actually close, several hurdles must be overcome. First, the inspections have to be completed. In most instances, the buyer has the right to terminate a transaction if they learn anything on the inspection that they are uncomfortable with, and in almost every instance, the buyer has the right to terminate if the seller does not agree to make the buyer’s requested repairs. So a seller has no assurances at all that their home will close until the inspection period is complete, which generally takes 21 days.

The same thinking would apply if the Agreement includes an appraisal contingency – until the appraisal is complete (which also takes 21-30 days), there is a risk that the home will fail to appraise and the transaction will not close.

If the buyer has a mortgage contingency, then there is a risk until a “clean” commitment letter is received from the lender that the buyer will not get their loan approved, in which case the transaction will not close. Usually it takes about 45 days from the date of agreement to know with any certainty that the buyer has received a loan commitment.

There is also the rare instance where a buyer never provides the contractually specified deposit money or second deposit money. This is a breach of agreement and if this happens, it’s reasonably unlikely that the buyer will cure that breach and close.

Finally, very rarely there are buyers who complete all of the steps in the process and just refuse to close. In those instances, the seller is often entitled to the deposit money, but that may seem like a small consolation prize when their home is empty and back on the market.

Working with a skilled real estate professional will help you to manage the risks and move toward a successful closing. So while the short answer is that there is never a guarantee until the home actually closes, with proper management of the details the risk to a seller of moving out and leaving behind an empty home can be minimized.

 

Finding the Right Agent to Represent You!

Dear Kathe,

We have our home listed with another agent and are unhappy with the service we are receiving. We can’t help but wonder what process we should have gone through to find the right agent. Any ideas?

When choosing a Realtor, it’s important to do more research than asking a colleague, friend or service provider who they would recommend. I often help my clients find an agent in the new city they are moving to, and I start online.

First, I look for agents who do a lot of business in the area my client is moving to. How many listings does the agent have? I look at her sold listings on Zillow and see how many she has sold, both in the area and in the price range my clients will be buying into to make sure she has the experience they will need.

I then look at her individual website for her certifications and qualifications. These credentials require extensive commitment to training by the agent, and training means the agent is best equipped to achieve the very best result for you.  Much of this training requires years of dedication to learning and excellence.  All agents are not brokers, for example.  An Associate Broker’s license takes a minimum of three years commitment to additional learning and hands on experience. If you are buying or selling a Signature home, there is an even higher level of training available to an agents such as Distinctive Homes Specialist.  Christie’s Great Estates Specialist.  These programs add yet another level of  skill and expertise to an agent’s repertoire.

I like to say “a monkey can stick a sign in your yard.”  It takes years of training and experience though to sell real estate while making it look smooth and easy.  By earning credentials, we learn how to price optimally, how to market strategically, how to use the latest technology for your benefit, the complex ins and outs of our lengthy Agreement of Sale (the intricacies of which are just waiting to ensnare the inexperienced), how to negotiate for success, how to navigate the rough seas of inspections and how to close on time.  Every one of these skills inures directly to your benefit and your bottom line.

I also look to see how developed her website is (is it more than a simple blurb) and how many reviews/ quality of reviews she has on Zillow. This gives a sense of how committed the agent is to the business.

Finally, I interview the prospective agents to determine marketing plans, detailed knowledge of the area and their personal market statistics.   So take the time – get to know our credentials – and make an educated decision when choosing your next real estate agent.

Picture This… Why You Need a Survey

Dear Kathe,

Should we get a survey in connection with our new home purchase or can we rely on the seller’s old survey?

Often buyers do not order a survey of their new home and while this saves a buyer at least $400 – $500, ordering a new survey when you buy a home is a good investment.   Surveys are valuable because they will show you whether there are any boundary issues with the property that might be expensive to fix later. For example, the neighbor may have built his new shed slightly over the property line. Getting that fixed might strain neighbor relations and cost you money. Better to let the current owner handle it before closing. Surveys can also reveal undisclosed easements across your property. You might find out that the neighbor has the legal right to have their driveway on a piece of your property or that the neighbor has a right to use your driveway to get to their property.   While you may be ok with shared use, it is certainly something you want to make an informed decision about and not something you want to find out after the fact.

Surveys are also valuable because they show you where you can build and where you can install items such as decks, patios, pools and sheds. These can be expensive to undo if you make a mistake and end up on your neighbor’s property – better to make an upfront investment in a survey and get it right the first time. Surveys are essential if you are planning to install a fence or invisible fence. In these situations its actually an excellent idea to have the surveyor return to “stake” the property line so that you are certain you don’t put your fence on your neighbor’s land.

Finally, without a survey, at closing your title insurance company will issue a policy with “survey exceptions,” meaning that if you later find out there is an issue, the title insurance policy will not pay to resolve the issue. In order to get the best possible title insurance coverage, it is important to get a new survey.

When you are moving toward closing on your new home your settlement company will ask you whether you want a survey and I recommend that you respond yes!

 

 

Should I Buy First or Sell First?

Dear Kathe,

We want to downsize but are not sure how to go about that process – do we buy our new home first or sell our current one first? 

Your question touches on one of the trickiest scenarios in real estate – sell first or buy first? The answer is different depending on an individual’s circumstances. Buying first is usually the best choice – you can take your time finding the perfect next house. And you can move out of your current home before listing it for sale, which will allow you to stage and present the home without clutter and without the hassle of having to tidy up for showings. However, buying first requires a few things. You must qualify to own two homes at once. You must have a down payment for your new home in a savings account, or an existing home equity line in place on your current home that will allow you to pull out the cash you need for a down payment. And you must be okay with the concept that you may be carrying two homes for an undefined amount of time.

If you do not qualify to own two homes at one time, do not have the required down payment for the new home, or are just too nervous about owning two homes for an undefined amount of time, then your only option is to sell first. It’s a good idea before putting your home on the market to get pre-approved for your new home purchase (you want to be sure you qualify before selling yourself out of your existing home) and to start looking online for new home possibilities. When you get an offer, you may need to act quickly. The buyer for your home is unlikely to be able to wait for you to figure out what you are going to do next. If you need to wait to figure that out, you may lose the buyer. Additionally, to purchase a new home, that seller is likely going to expect that you have already moved through inspections on your current home and have a solid deal. Therefore, you will want to agree to a longer closing date on your current home to give you time to get through the inspection negotiations and select a new home. Of course, there is always the option of renting if you cant find the right home!

It is tricky, but with proper strategic guidance it can be accomplished smoothly and successfully.

Selling with Old Mechanicals

Dear Kathe,

We have a very old (25 years) furnace.. It is still working well and we don’t have the cash to replace it. We are planning to sell our home next year. What advice do you have?

A 25 year old furnace is a very old furnace, well beyond the useful life expected of such equipment. If a buyer makes an offer on your home and then finds out how old your furnace is, there is a very high likelihood that they will be asking you to buy a new furnace as part of their inspection response. There are a few things you can do to set yourself up for a positive outcome.

First, when you complete your seller disclosure, be sure to write on the document that the furnace is past the end of its useful life and may need to be replaced soon. Price your home accordingly and be sure that your agent highlights to buyers agents that you have priced your home at a lower price point because of its older mechanicals. This will prevent the buyer from expecting you to buy them a new furnace – they should take the age of the furnace into account when making their offer.

Second, put a home warranty on your home when you list it. This will provide coverage to you should the furnace break while you own the home and will give the buyer 12 months of coverage should anything happen in their fist year of ownership (and it is renewable).

Finally, consider buying a new furnace. Many contractors are willing to accept payment at closing if you make arrangements for this upfront. With a new furnace you can ask more for your home and are more likely to draw more enthusiasm form the buyers who do see your home.

Prequalification or Preapproval? Which is Right for You?

Dear Kathe,

We are planning on buying a new home in the coming months? Should we get prequalified or preapproved for a loan? What is the difference?

Its always important to make one of your first steps in buying a home a conversation with a lender. Pre-qualifications are easy – you just pick up the phone and tell the lender your income and amount you have available to put down towards the purchase, they check your credit and issue a preapproval letter. However, this does not hold much clout with the seller.

A preapproval is a much more rigorous process. Basically, you apply for the loan without having found a house. You give the lender all of the documentation they think they need and they out it through the loan underwriters. This is much more time consuming – these days lenders require quite a long list of documentation and explanation to approve a loan. However, this is something you will have to go through anyhow when you are ready to buy, so its not a bad idea to get it done upfront.

The preapproval process will also save you potential heartache later. Sometimes buyers are surprised at what gets in the way of a loan, You may have child support or student loan debt, for example, that you don’t think to mention in the very simple prequalification process that lowers what you can afford on a monthly basis. It would be unfortunate to find your dream home only to go through the loan approval process and find out that you don’t qualify to buy it. Additionally, sellers strongly prefer preapproval letters from buyers because they know lenders have taken a thorough look. A preapproval letter will make your offer much stronger, which could be important if more than one offer is received.

Keep in mind that whether you go through the prequalification or the preapproval process, this does not bind you to a specific lender. Once you have a home under agreement, you are free to shop rates and costs to choose the best lender for you.

Partnering for the Sale

Dear Kathe,

 Our home has been on the market for a while – we are getting a fair amount of traffic but so far, no offers. We are concerned that others are selling and ours is not. What are your thoughts?

 Selling a home is a partnership – a realtor cannot waive a magic wand and make a home sell. An agent’s initial primary job is to make sure that your home is well advertised and to provide honest advice and feedback about condition. If you are getting a reasonable amount of showings, then that’s a good sign that the marketing is working well. Hopefully, you have gotten feedback from these showing and have taken steps to overcome any perceived drawbacks. Some things can’t be overcome – if a buyer needs an extra bedroom or garage, there isn’t much to do about that, but if there are concerns that you can address, be sure that you do.

Take a quick tour of your home, invite a neighbor over for a look or visit other open houses to make sure your home is presenting as well as your competition. Take staging to a new level. If you have checked all of the typical boxes (no wallpaper, neutral carpets throughout, neutral paint, no clutter, removing personal items such as family photos and religious décor…) take the time to consider what else YOU can do to help improve the chances of an offer. If your rooms don’t look open and spacious, remove more items to a storage facility. Did you remember to clean your windows this spring? Dirty windows can make a home very dull inside. In this heat, have you been watering your landscaping so that it is alive and thriving? How about your lawn? Green or dead? Have you removed the signs of your own wear & tear – are switch plates and walls clean and smudge free? Have you de-cluttered too much making your home sterile? Pottery Barn is still the easiest look to sell—make sure that while your home is reasonably free of personal items such as family photos, it has some warmth – fluffy white towels in the bathrooms, attractive throw pillows on couches and beds… Unsure of what you need? Bring in a home stager for some professional advice. Remember, selling a home is team work – you need to be doing your part!

Finally, price must constantly be evaluated. Keep in mind the oldest rule of thumb in the book – 13 weeks or 13 showings – if you still don’t have an offer, its probably price. Yes, improving condition can improve price. But if you are getting the showings and you aren’t drawing an offer and can’t make significant changes to the home to overcome objections, you must reduce your price, or be very patient waiting for what could be years for that one buyer to come along.

A Pre-inspection is Your Best Offense!

Dear Kathe,

Friends of mine just had the sale of their home fall through because of a home inspection. How can that be prevented?

 Yes – sellers should have their home pre-inspected before listing to prevent these kinds of issues! Finding a buyer and agreeing on a purchase price is only one small component of a real estate transaction and yet it is often all that sellers focus on.  What happens between then and closing, however, is often the more difficult part of the process.  Issues with a home uncovered on an inspection often cost a seller thousands in unexpected repairs and when sometimes even result in a terminated transaction.  Inspectors are incredibly thorough (sometimes even finding problems that aren’t problems) and so every home seller should anticipate that the home inspector will find deficiencies and that the buyer will expect correction.

All home sellers should seriously consider having their homes pre-inspected.  For as little as $250 – $500 for a basic pre-inspection you will quickly have an insiders view of how a buyer’s inspector will assess your home.  Use the inspection as a maintenance check list – find a handyman to come in and fix all of the little things so that they don’t come up again on a buyer’s inspection.  If there are larger items that you do not have the ability to repair, such as a roof nearing the end of its useful life, get an estimate or two for the repair or replacement.  Note the issue on your disclosure and include a copy of the estimate.  This should prevent you from having to credit the buyer for the repair later – buyers are supposed to review the disclosure and take any disclosed items into account in making their offer to you.

Of course, if your inspection is good or just has a lot of little items that a handyman can fix, attach the handyman’s receipt showing the repair provide a copy of the inspection in the house for buyers to see with a note indicating that the home has been pre-inspected and repaired and that they buyer can buy with confidence knowing that they are buying a house in great shape!  In a town full of older and aging homes, this will really help your marketing!

So before you list your home – consider a pre-inspection.  It will give buyers the confidence they need to move ahead with a purchase, may combat concerns that there are likely problems that would lower their initial offer to you, and will hopefully result in a smooth transaction once you do have your home under agreement.

 

Do Your Floors Tell a Story?

Dear Kathe, 

We live in a somewhat dated home we would like to get ready to sell — we have older caret and flooring — an advice of what direction we should head in when updating?

These days, the trend in interior design is to unify interiors.  Flooring is seen as a base on which to build a room.  The most universally liked flooring style is one that remains the same throughout an entire level of a home.  Unlike the 70s & 80s, when the trend was to choose a floorcovering for each room, these days it is far more popular to just pick one (or at most two) per level.  You will therefore often find that the entire main level is hardwood.  The entire second level may also be hardwood, but it could also be a neutral unifying carpet.  The design scheme then builds off this neutral base, perhaps layering on area rugs to add personal style.

In light of these trends, nothing dates a home faster than if there are a multitude of different floor coverings on one level.  It could be that each bedroom has a different color carpet.  It could be that there are four different materials on the main level – tile in the kitchen, marble in the foyer, hardwood in the family room and carpet in the living and dining rooms.  These floors all tell a story – the person who chose them was seeking a specific look in each individual room.  Those days are gone, the person has likely moved on, but the floors still hint of stories past.  Interestingly, when buyers visit homes like these they cannot usually pinpoint what they don’t like – they just say “its not for me,” or maybe “its too dated.”  What they can’t usually put their finder on is that they are missing the harmony that generally comes from unified floor coverings.

What does this mean for you, the home owner?  As you update your home, keep your floor coverings uniform throughout a level (up to two choices per level are usually ok).

My Crystal Ball is Out for Repair!

Dear Kathe,

How much more “life” do you think our spring market has left in it?

My crystal ball is out being repaired so I’m afraid my response will need to be a best guess, without it’s reliable aid! In all honesty, what the market is or is not doing in a given week or season is never more than a guess. There are certain norms that we have come to count on: the spring market is stronger than the fall market; homes in the Village sell faster than homes “up the hill,” which often require more patience. But being able to predict how long buyers will continue buying in any season, or how many buyers companies may transfer in, or how many buyers will accept the jobs they are offered and actually come to Pittsburgh, choosing Sewickley as their home base, is impossible to predict with any certainty.

And of course, there is the added uncertainty of what impact a Presidential election has on our market – historically it often slows around election time. It’s been a strong spring market. Buyers have come in waves – there was a huge surge in the March. Sales have been strong in certain brackets and not in others, but that could change on a dime. We saw a small surge “up the hill” but that market has quieted again.

To answer your question, I expect sales to continue along their usual patterns, with a reasonable number of sales in June and some in July as well. We are in our final push of families who need to be in for the school year. I expect that things will slow as they always do in August when most people desert Sewickley! Usually things pick back up again in October. If your home hasn’t sold yet, there is still a chance it could sell this spring, particularly if its well conditioned and priced perfectly. If you are thinking about listing in the future, it’s the perfect time to give me a call and develop a strategic plan for entering the market in the months to come!

Where Did All the Color Go?

Dear Kathe,

Why does it seem that almost every home we view online is so neutral? What happened to all the color?

 I recently reviewed a portion of a local market in the mid-price ranges and interestingly, almost every home that is under agreement has zero wallpaper and is painted in a neutral color palate (including beiges, grays, greiges and a few other nearly neutral tones). Only one of these homes had any true color on its walls, and that home took nearly a year and several price drops to go under agreement.

Professional home stagers have been counseling for years to remove all wallpaper before putting your home on the market –asking someone to buy a home with wallpaper is as personal as asking them to buy someone else’s wedding dress. No matter how beautiful, it’s rarely done and appeals to very few. Stagers are also quick to recommend neutralizing your paint palate. While there are some warmer neutrals, these days the cooler neutrals like gray and greige are the more popular tones with the buying public. Even having a more colorful child’s room can be a big turnoff.

It seems the selling public has in large part heeded this advice. The homes that are actually selling for the most part have been stripped of their wallpaper and painted in a more current, more neutral paint palate. Absent a compelling reason to choose a home that is not “sale ready” such as a severely discounted price, buyers are far more likely to overlook other “road blocks” to a sale such as a lack of a garage than they are to look past a personalized and colorful decorating scheme.

Does this mean that we must all live in color-free homes? Of course not! Your home should reflect your personality and your personal furnishings undoubtedly tie your color choices together. But it is important when we move toward a customized design scheme to remember that when its time to sell, part of the cost of selling will be repainting these spaces back to a more neutral palate!

Pocket Listings — Are They For You?

Dear Kathe, 

We have noticed that several homes have sold lately before they have hit the MLS. Are these “pocket listings” a good way to sell your home?

If a home sells before it hits the MLS, as a “pocket listing” as they are often called, it is highly likely that the seller could have sold the home for significantly more money. The MLS exposes a home to a large number of prospective buyers in a very short amount of time. This widespread exposure is what has the potential to drive the price up for the seller.

A “pocket listing” is more like a secret sale. The agent you are dealing with may have a buyer that is willing to buy your home, but if it’s that easy, chances are you could have received more money if the general public had a chance at your home, and a bidding war could have possibly ensued. If an agent is being straightforward with the seller and discusses the strategies involved with using the market pressure of the MLS to drive in a higher price, it’s a rare seller who will willingly leave money on the table.

So why do we occasionally see these seemingly “secret sales” taking place? Some sellers perceive these pocket listings as a good thing – some don’t want to be hassled with multiple showings, some don’t want the general public to know their home is available for sale. Some agents choose this strategy because they want to keep all of the commission for themselves and that only happens if their own buyer is the successful bidder. If a seller’s goal is to maximize financial return, however, a pocket listing, or accepting an agreement of sale before the home is marketed in the MLS, is rarely the best strategy.

So no, my 17 years experience indicates that a pocket listing is usually not in a seller’s best interests. The highest returns I have seen sellers achieve occur in scenarios when they have used strategies to maximize the excitement within the buying community through proper pricing, excellent conditioning and staging and full MLS exposure.

The Pace of the Sale

Dear Kathe,

Why do some homes seem to fly off the market and others take years to sell?

Location. Price. Condition. These are the three most important factors that go into how long a home is on the market. Unique attributes and depth of market segment would be fourth and fifth!

Location is really where it all begins. If your home is in an easy to sell location, the market will be far more tolerant of imperfections in other areas, such as wallpaper or a slightly aggressive price. Location is sometimes relative to a particular buyer – their work address may make one part of town more desirable than another, but generally speaking, buyer excitement about properties rises and falls with address.

Condition is also a very important factor in pricing. Homes that look like they are straight from the pages of a Pottery Barn catalog tend to sell more quickly, and tend to bear higher prices than are sometimes warranted. Those that are dated, with older wallpaper and carpeting, for example, tend to sit – unless, of course, they are in a hot location and deeply discounted, in which case our stable of “flippers” will be ready to buy with cash and close quick for the opportunity at a profit when they renovate.

Price is the easiest of all factors to change. If priced well, even less popular locations and homes that have condition challenges can sell quickly. But if you are trying to match the price of competing sales that were in better locations, better condition or with more amenities, you may find your home takes far longer to sell.

Finally, you may have a home with unique features. A home with no off-street parking can be a challenge to sell at any price point, and it is a matter of being patient and waiting for the right buyer who appreciates the home’s other attributes. You may not have a master bathroom. You may not have any green space in your “yard.” You may have a kitchen barely big enough for one. You may have only two bedrooms. There are many factors that could lengthen time on the market even with perfect condition and price. And of course, depth of the market segment is relevant as well. The higher you go in price, the fewer qualified buyers there will be and the longer your home will take to sell.

My Magic Wand

Dear Kathe,

Our home is on the market and not sold – where are the buyers this spring? How can we get it sold?

 Our spring market has seen some very unusual fluctuations.  In some weeks there have been surges, with several houses going under agreement in a week, and other weeks have been quiet.  The one million dollar price range has been hot for the first time in a couple of years.  The under $300,000 market is also moving very well.  If you’re home is in the “middle” then yes, it’s been slower than expected and it’s hard to know why.  Speculation has included the election, of course, as well as cutbacks in some oil and gas companies.

Sadly, real estate agents don’t have magic wands that we can wave to make a buyer appear for your home.  If it’s been on the market for more than a few weeks it’s likely the local prospects have seen it and determined that its not a fit for them.  The most likely buyer is someone currently outside the area, and there is just no predicting when a company is going to relocate someone who might be looking for a home.

 Therefore, what you must do is make sure it is the best choice in the price range when a buyer does arrive on the scene.  It is important to make sure that it shows perfectly – there is a lot of competition – other sellers who really want a buyer as well.  I have written many articles that you can find on my blog at www.kathebarge.com that cover critical topics like de-cluttering and staging, and updating your home.  It might be time to bring in a professional stager.  It might be time to update paint colors, freshen any dated carpets, update lighting fixtures or baths. Many of these things can be done very cost effectively and could give your home the edge with the next buyer through town.

 It may also be time to have a professional appraisal done of your home, both to check to make sure that you have it priced competitively and to give any buyer prospects confidence that the value is there.

 In the end, homes with completely updated features and current design palates continue to be the first ones to sell.  If that’s not your home and changes aren’t possible, then review price, do the best you can to stage and de-clutter, and then be patient.  Buyers can be very fickle – your buyer will come!

The Fine Art of Negotiating

Dear Kathe,

How much negotiation should we expect when buying a home?

Some homes sell for 100% of asking price, even months after they have come on the market. Others sell for 25% off ask. How does a buyer even begin to know how much to expect to “negotiate off” the asking price of a home?

Community practices are a good place to start. In the North Hills, for example, homes typically sell for very close to asking price – if a home is priced too far above what the market will bear, buyers simply sit and wait for sellers to reduce. In Sewickley Heights, on the other hand, large discounts are commonplace.

It’s also important to consider how long a home has been on the market since it’s last price reduction. If it’s been a few months, there may be more room to negotiate.

The time of year and market activity and other important factors. In the spring market, homes are far more likely to yield higher realizations. This has been a very hot spring market – if you are buying this time of year and looking for a large discount, you may be disappointed.

Listing agent pricing styles are also relevant – some agents price to allow for large amounts of negotiation and others prefer to choose a price very close to market value in an effort to engender more enthusiasm about a home –knowing the agent’s average realization will help you determine the best approach to take if you actually want to be successful in your negotiations.

Finally, and most importantly, its important to review and understand the comparable homes, including price per square foot and neighborhood particularities. If a home is priced at or below the price at which comparable homes in similar locations have sold, it’s highly unlikely a deep discount offer will succeed.

Before you determine how much to offer and how you will approach your negotiations, ask yourself how much you want to own the home. If you are dreaming about raising your family there and your goal is to actually own the home, take a realistic look at the above factors before diving too deep with your offer.

Should It Stay or Should It Go?

Dear Kathe, 

My mother recently passed leaving me and my brother a well-maintained but not updated house built in 1960.  It’s full of furniture that is clean but bulky and out of style and almond-colored appliances that work fine but are 20-30 years old and don’t match. We plan to sell the house.  My brother thinks the house will sell better if it has some furniture and appliances in it; I think it would sell better with empty rooms (it has beautiful hardwood and tile floors that have been covered with carpet since the day they were built) and the distracting appliances removed. What would you advise?

First, you absolutely must empty the home – these days young buyers want Pottery Barn, not grandma and grandpa’s house.  Buyers also do not respond well when personal effects of a decedent remain behind after they are gone – so it’s important that it be completely empty before anyone tours the home.

Second, any old carpet should be removed. If there are hardwood floors underneath, that is what buyers want these days and you will do far better in your realized price if the floors are fully exposed. If they are not in good shape, it is possible to buy a Bruce product at the hardware store that does an acceptable job making them look presentable and is easily mopped on.

You must have a stove in the house in order for the buyer to get a mortgage. Therefore, you either need to keep the old one or buy a new one.  Refrigerators, however, do not need to be retained and you may be able to get a credit for turning an inefficient old refrigerator in.

I would also recommend that you and your brother have the home pre-inspected and appraised in order to make the selling process as smooth as possible!

Contingency – Buyer’s Side

Dear Kathe,

Is it possible to buy a new home contingent on selling our current home?

It certainly is possible to make an offer on a new home contingent on selling your current home! However, an offer with a home sale contingency is not a strong offer. You are asking the seller to stop marketing their home in the hopes that you will sell yours, which can feel like a big gamble to the seller. If this is the direction you need to go in, there are some important tips to keep in mind.

  • Sellers are more likely to consider your home sale contingency if their home has been on the market for a long time with no other interest, if we are in a slow market season (fall) and they are unlikely to have any other serious interest in the short term, and/or if you are offering them a very high price which makes it worth taking a chance on you. If you want your offer with a home sale contingency to succeed, make them an offer at or close to asking price.
  • Sellers are more likely to consider your home sale contingency if your home is already on the market and you can show that it is priced well for a quick sale and is getting significant showings. If you want your offer with a home sale contingency to be accepted, don’t list your current house at a top-of-the-market price.
  • Sellers are more likely to consider your home sale contingency is you choose the type of contingency that allows them to actively market the home to other buyers. Of course, from your perspective you would prefer to lock the house up, but that is unlikely to happen. The right to continue marketing contingency at least allows you to know that you can buy the home at an agreed upon price as long as you get yours sold before another buyer comes along.

Of course, two better options include getting your home on the market and sold so that you can make an offer contingent only upon it’s closing, or exploring options with a mortgage broker that would allow you to make a non-contingent offer.

The Cost to Close

Dear Kathe,
Is a seller expected to help pay for the buyer’s closing costs and if so, how much?

Sellers often contribute to buyers’ closing costs in lower price ranges and in first time home buyer situations. Typically buyer closing costs are not less 3% of the cost of the home and may be as much s 6%. Buyer closing costs include expenses such as transfer taxes (1%), lender fees, title insurance, property tax proration, homeowners’ insurance premiums and pre-paid mortgage interest. These fees can add up quickly. Sometimes buyers do not have enough cash saved to be able to pay their required down payment and their closing costs as well. They may be very well qualified to buy in that their salary is high enough to afford the monthly payment, but they just don’t have enough cash saved.

When this happens, buyers will look to sellers for help in paying the closing costs that the buyer would normally have paid. This is normally expressed as a percentage of the purchase price. For example, the buyer might ask the seller to pay 3% of the purchase price toward their closing costs. The seller is automatically netting 3% less in this scenario, before they pay their own closing costs which normally range between 7% – 8% of the sales price.

Before you jump to the conclusion that sellers often won’t agree to contribute toward a buyer’s closing costs, stop and look at the greater picture. Normally sellers who help with closing costs are receiving 100% (or very close to that) of their asking price. On the other hand, it’s a rare day that any listing sells for 100% of its asking price, and the average “realization” before seller expenses in Quaker Valley School District is less than 90%. So paying 3% in closing cost assistance but getting a 100% (or close) offer might be your best deal!

What Does “Paper Separately” Mean Anyway?

Dear Kathe:
When you buy a house, what sorts of things can you paper separately so it doesn’t show up as purchase price? I know of a $1.5M sale that was recorded for $1.3M, for example.

There are times when a buyer may want to reflect a lower price on their deed than what they may initially be willing to pay for a home. There are several ways that this can be done if that is your goal. One option for a buyer wishing to reflect a lower deed price is for the buyer to offer to pay the seller’s commission. For example, if the seller of the home you seek to buy is offering a 6% commission and you are planning to offer $500,000, if you offered to pay the real estate commission of $30,000, you could reduce your offer price, which is reflected on your deed, to $470,000.

At the time of closing, a buyer and a seller each pay a 1% transfer tax in our area. You could also offer to pay the transfer tax that the seller would otherwise have paid, in my example being $5,000, and reduce your offer accordingly, in this case to $465,000.

Finally, if you are planning to buy any of the personalty with the home, you can schedule that separately as well. For example, you may have asked the seller to include in the sale their pool and ping pong tables as well as all of their custom draperies and central vac equipment. You may feel these items are worth $20,000 and offer to buy these items separately from the seller, thereby reducing the offer price in this case to $445,000.

With these three cost allocation methods, you will have reduced your deed price from the $500,000 you were willing to pay to $445,000 offer price which will be reflected on your deed, plus $55,000 in allocated costs. Of course, to do this you would have to have the cash on hand to pay for the allocated costs plus your planned down payment – banks will not consider the amount you pay for any such allocated costs as part of your down payment. In this case, you would likely need at least $150,000 cash on hand to utilize these cost allocation strategies. Accordingly, these strategies only work for homeowners who have saved large sums of cash that they are willing to invest in their homes.

Where Did They Get THAT Price!?

Dear Kathe,

How do we decide how to price our home? We know buyers like to negotiate!

Deciding on an asking price is a challenging task, particularly in Sewickley.  Interestingly, in Pittsburgh’s North Hills, sellers realize much closer to their asking price, often 97% and higher.  However, if a property is overpriced in the North Hills, buyers will simply write the property off – low-ball offers are not made.  In Sewickley, however, we have developed the unique tradition of negotiating fairly heavily on the sale of a home.  In prior years, the average realization was only 89% and offers often start as low as 80% below asking price.  So how is a seller to price a property?  If a seller prices 20% over the price a home is likely to sell for to allow for negotiating, it is likely to be seen as “overpriced.”  If the seller prices only 2% over likely sales prices, many buyers will factor in the large discounts we often see and bring in inappropriately low offers.  Developing a strategy for both pricing and marketing is therefore critical to make sure that a home is both well received and does not sit and get stale on the market.

If you’re facing a deadline due to job relocation or other reasons, then you need to price competitively, even more competitively than expected in today’s market.  You’ll need to list at significantly less than your competition.  And keep your commission higher as an incentive for a quicker offer.  That may seem tough to stomach, but it’s better than continuing your monthly loan payments or the hassle of trying to find tenants to rent your home and of being a landlord for a year or more.

If your home has been listed for some time, but not generating interest, you may need to lower your price.  Of the three elements that sell a home – price, location, and condition – price is the one you’ll have the most control over.  Review your listing company’s programs and marketing, making sure that you are taking advantage of all of them.

Make sure your home shows better than its competition.  Its condition should outshine all of the other listings in its price range.  Take time to de-clutter, store off site what you can live without, stage and make sure you attend to all of the little maintenance projects you may have been putting off.

In the end, Sewickley statistics show that if your home does not have an agreement on it within 75 days of the listing date, you will not achieve 90% or more of your original asking price.  This makes the original list price a critical decision and also makes it clear that after 75 days, it is absolutely essential to reevaluate your price in light of market feedback and price.

The Long Wait Until Closing

Continuing from last week:

Dear Kathe,

We’re first time home buyers – where do we begin? 

At this point in our journey to your new home, hopefully you have resolved any home inspection issues that you have and your financing is in process.

There are many pieces to the home financing puzzle that you will not see and some that you will.  Financing has gotten quite tight now and you will need to be prepared for a high level of documentation required by the lender.  They may ask you to document sources of deposits.  They may ask you to document other expenses you are responsible for.  They may need copies of letters of employment or bonus guarantee letters.  Be prepared to respond quickly to any and all requests.  While you are addressing these requests, the lender will order an appraisal to confirm value of the home.  There is a range of reasonable in which a home may sell – the lender is simply trying to make sure that you are in that range.

Once your loan is approved you begin the long wait until closing.  If you had a particularly delayed closing, you will begin to wonder if you are supposed to be doing something else.  The next steps happen right before closing.  You will set up your insurance coverage on the home with your insurance agent a few weeks in advance.  Coverage options vary widely so you will want to work with an insurance agent who will thoroughly review all of your options with you.  About a week before, you will need to call the utility companies to move the utility bills to your name.  If you forget to do this, the utilities will simply be turned off and it will cost you more to get them turned back on again.  For water and sewer, you will need to show up in person to get them connected, so be sure to schedule that in to your work schedule.  Finally, the day before closing you will do your walk through to make sure the home is as you expected it would be.  If the seller accidentally removed something you thought was to remain or forgot to make a requested repair, now is the time to raise those issues.  Once you close, so does your window of opportunity to resolve any last minute concerns with the seller.

On the day of the closing, you will spend about an hour signing many documents and presenting a cashier’s check for any balance you owe above and beyond the mortgage.  Once that is completed, you will receive the keys and may begin the happy process of unpacking into your new home!

Negotiations Begin!

Continuing from last week:

Dear Kathe,

We’re first time home buyers – where do we begin? 

If you’re following along each week, by now you have been pre-approved for a loan, selected a Buyer’s Agent, looked at and selected a Property, made an offer and are negotiating for your new home!

The process of negotiating for a home is one of give and take.  Your Buyer’s Agent should be able to explain negotiating norms in the areas in which you are interested.  For example, in our North Hills communities, Sellers price their homes more tightly and they generally sell in the range of 98% of list price.  If you bring an offer at 90% of list price, you may not even get a response.  In Sewickley, there is often a bit more flexibility.  Keep in mind, however, that price isn’t the only concern.  Closing date is important – if you can’t get the date you want, you may need to pay for temporary housing and storage of your things.  Inclusions are important – if a Seller starts removing things from the home, they are things you may need to spend money to replace and this may affect what you are willing to pay for the home.  You must keep all of this in mind as you try to negotiate to a final Agreement to purchase the home.

Once you and the seller reach a deal, both parties sign the Agreement and you are officially “under agreement.”  At this point, the contract takes over and specifies exactly what you must do next.  Your Buyer’s Agent should lay all of this out for you in easy-to-use timelines.  This is absolutely critical – if you miss deadlines, you could lose your deposit money in some scenarios.  You generally have 1-2 weeks to apply for a mortgage.  Do not delay.  The lending process is quite complex these days – there will be a lot of detailed information requested – this will take you time to compile.

At the exact same time that you are applying for your mortgage, you will also be inspecting your new home (yes, it will be very busy for a few weeks).  More on inspections next week…

Get Thee to a Buyer’s Agent

Continuing from last week:

We’re first time home buyers – where do we begin? 

Hopefully after reading my article last week, you were motivated to get serious about buying a home and began the process.  As I discussed last week, you should be saving your down payment, keeping your credit in excellent shape, getting pre-approved by a recommended lender and researching and selecting a Buyer’s Agent.  So what’s next.? The fun begins!

Your Buyer’s Agent should set you up to receive new listings via email as soon as they become available.  To streamline the process, it is a good idea for you to pre-screen these homes before going to see them.  Check them out online and on google earth, do a drive by to make sure there is nothing that you would object to that is readily apparent.  Once you have done your initial screening, go to see the home as soon as possible.  Our inventory is at record lows.  If you love a home you can be sure that there are at least a dozen other buyers considering the home and you will need to be ready to make an immediate offer.  Along these lines, it is important that you have developed a relationship with your Buyer’s Agent and trust her judgment.  When the right home becomes available you may have to pay full price to get it, and you need to be working with someone you feel you can trust on those decisions.  In this market there is rarely time to test out the seller if it is a great house and is well priced.

When making the offer, allow about 2 hours to go over the contract with your Buyer’s Agent.  You will want your agent to review the details with you and there are many decisions you will need to make when writing the offer.

You will need to work with your agent to decide how much to offer initially, how much hand money to put down, a closing date, the mortgage terms you plan to apply for and time periods for inspections.  You will list the items that are in the house that you expect to stay there, such as dishwashers, refrigerators and window treatments.  There are many other custom terms you may want to include – you may want to include an appraisal contingency.  You may be looking for the seller to address certain deficiencies that you noted while walking through, such as cleaning gutters.  All of the things that are important to you about the home must be written into the contract or they will not happen in the future.  Oral agreements are not binding when it comes to the sale of property.  Your Buyer’s Agent has hopefully paid close attention to everything you noted while viewing the home and will make sure that the Offer reflects all of your wishes.

Once you have signed the offer (and no, you can’t just make a verbal offer – as mentioned above, everything concerning land must be in writing) the offer will be presented to the seller and you will begin negotiations with your seller.  Stay tuned as the process of buying your home continues to unfold next week…