Eight Ways To Bolster Your Appraisal

With historically low interest rates and rising property values, many homeowners are trying to refinance their mortgages. Often the most stressful part of the process is the appraisal. If you are in this situation this article we found on Reuters may help you out. Below are what they cite as the eight ways to help the appraised value of your property. (Source ) While all of these may not apply to your specific property or situation, we found the information really helpful. If you are curious about your home's value for either sale or refinance, do not hesitate to contact us we would love to help you out.

Here are eight ways you can bolster your appraisal:

1. MAKE SURE APPRAISER KNOWS YOUR NEIGHBORHOOD

Is the appraiser from within a 10-mile radius of your property? "This is one of the first questions you should ask the appraiser," says Ben Salem, a real estate agent with Rodeo Realty in Beverly Hills, California. He recalled a recent case where an appraiser visited an unfamiliar property in nearby Orange County and produced an appraisal that Salem said was $150,000 off. "If the appraiser doesn't know the area intimately, chances are the appraisal will not come back close to what a property is really worth."

You can request that your lender send a local appraiser; if that still doesn't happen, supply as much information as you can about the quality of your neighborhood.

2. PROVIDE YOUR OWN COMPARABLES

Provide your appraiser with at least three solid and well-priced comparable properties. You will save her some work, and insure that she is getting price information from homes that really are similar to yours. (For this info we suggest you call a local Realtor to help you out so you can give the appraiser the most accurate data available).

 

3. KNOW WHAT ADDS THE MOST VALUE

If you're going to do minor renovations, start with your kitchen and bathrooms, says G. Stacy Sirmans, a professor of real estate at Florida State University. He reviewed 150 variables that affect home values for a study sponsored by the National Association of Realtors. Wood floors, landscaping and an enclosed garage can also drive up appraisals.

4. DOCUMENT YOUR FIX-UPS

If you've put money into the house, prove it, says Salem.

"Before-and-after photos, along with a well-defined spreadsheet of what was spent on each renovation, should persuade an appraiser to turn in a number that far exceeds what he or she first called out."

Don't forget to highlight all-important structural improvements to electrical systems, heating and cooling systems - which are harder to see, but can dramatically boost an appraisal. Show receipts.

 

5. TALK UP YOUR TOWN

If your town has recently seen exciting developments, such as upscale restaurants, museums, parks or other amenities, make sure your appraiser knows about them, says Craig Silverman, principal and chief appraiser at Silverman & Co. in Newtown, Pennsylvania.

 

6. DISTINGUISH BETWEEN UPSTAIRS AND DOWNSTAIRS

Many homeowners covet that refinished basement, but that doesn't mean appraisers look at it the same way. "Improvements and additions made below grade, such as a finished basement, do not add to the overall square footage of your house," says John Walsh, president of Total Mortgage Services in New York. "So they don't add anywhere near as much value as improvements made above grade."

According to Remodeling magazine, a basement renovation that cost $63,000 in 2011-12 will recoup roughly 66 percent of that in added home value. That's not as good as an attic bedroom, which will recoup 73 percent of its cost. Even similar bedrooms typically count for more if they are upstairs instead of downstairs.

7. CLEAN UP

Even jaded appraisers can be swayed by a good looking yard. "Tree trimming, cleaning up, a few flowers in the flower beds and paint touch up can all help the appraisal," says Agnes Huff, a real estate investor based in Los Angeles.

That advice holds true indoors, too. "Get rid of all the clutter in your home," says Jonathan Miller, a longtime appraiser in New York. "It makes the home appear larger."

8. GIVE THE APPRAISER SOME SPACE

Don't follow the appraiser around like a puppy. "I can't tell you how many homeowners or listing agents follow me around in my personal space during the inspection," he says. "It's a major red flag there is a problem with the home."

And while you're at it, make the appraiser's job as pleasant as possible by giving your home a pleasant smell. At a minimum, clean out the litter box. Baking some fresh cookies and offering him one or two probably won't sway your appraisal, nor should it. But it couldn't hurt.

Stagnant Agents + Changing Market = Frustrated Buyers

Just in case you have been living under a rock for the past 9-12 months, we have a serious lack of inventory in Stanislaus County- like a month's worth or less. Because of this the job of a buyer's agent is changing, and what may have worked in the past is not working anymore. The result is overworked agents and extremely disappointed and frustrated buyers.

Fast forward to yesterday when I read a Facebook post by a lender friend of mine asking what agents are doing these days to get offers accepted for their clients, because he has a lot of pre-approved buyers looking but they aren’t having much luck getting an offer accepted.

There were some really great responses by other Realtors- which got me thinking:

AS A BUYER, HOW DOES YOUR AGENT  AFFECT YOUR ABILITY TO GET YOUR OFFER ACCEPTED IN A COMPETITIVE MARKET?

Despite what many buyers think, their agent has just as much to do with their ability to successfully buy a home as the dollar amount they offer the seller. Here is some of what I see are the "best practices" your agent should be using to get your offer accepted:

• Your agent should be advising you to put yourself in the best position possible to get your offer accepted. If you come to them as a new client assuming you can ask the seller to pay all your closing costs, and they do not tell you otherwise and instead help you find a way to get the money another way they are not giving you very good advice. You are going to write offer after offer and likely not understand that is the ONE thing holding you back from getting an acceptance.

•  Your agent should be encouraging you to look at homes priced below the max you want to spend. If they are encouraging you to only look at homes that are at or above your max they are setting you up for more disappointment. If you are only willing to spend $150,000, you should be looking at homes that are $140,000-$145,000 so you can offer MORE than asking price. Not less.

• If you come to your agent as a new client with a preapproval from a lender they are unfamiliar with, they should be encouraging you to get a second opinion or explore alternative loan programs. Our market is changing- and with it so is the lending market. There are more programs out there now with low down payments besides FHA!  Your agent should be telling you this; because changing loan programs may cut down on costs so much that you can afford $20,000 more in house and afford to “play the game” when it comes to making offers above asking price.

• Lastly, are they a true professional? Honestly, this is probably the most important point on this list. It really, really matters how professional, courteous and respectful your agent is with the SELLERS of the homes you are looking at. Rapport matters! If you as the buyer and your agent are kind, polite and take a minute to build rapport with a seller when given the chance it will carry you MILES when they are looking at a pile of nearly identical offers. THEY WILL REMEMBER YOU THE SAME WAY THEY REMEMBER THE AGENT WHO WAS LATE AND/OR WAS SHORT AND UNFRIENDLY TO THEM!  Also, it really, really matters what kind of relationship your agent has with other agents in town. Having solid, long-standing trusting relationships with other agents does help to get offers accepted. If your agent is rude, unprofessional and/or has a reputation of not playing well with others it is most definitely going to hurt you. I should note here too the same goes for your lender! If you have a lender with a bad reputation it will make your offer get flat- out rejected the majority of the time.

If you are shopping for a home and you are already working with an agent, ask yourself if they are doing any or all of these things to create the best possible scenario for YOU. The market is changing. Is your agent changing with it?

Having Trouble Getting Your Offer Accepted? Try Writing A Letter!

Let's be real- writing a thoughtful letter to someone to get what you want is not a new idea. In fact, it has been happening in real estate for quite some time but hasn't been incredibly prevalent.

With our inventory woes in Stanislaus County buyers are getting creative- and it is working.

In our most recent short sale, we received multiple offers as we expected. The offers were largely similar in price and terms- but one stood out from all the rest. It included a very thoughtfully written personal letter from the buyer to the seller. In it she thanked them for allowing her to see their home and elaborated a little bit about her individual situation and the difficulty she's had finding a home. It touched them so much it persuaded them to accept her offer over the others we had received.

A personal letter accomplishes a couple things- first, it builds rapport between you and the seller. It puts a "face" to the name on the contract and enlightens them to your situation. Many sellers were at one time in the same situation and can be extremely empathetic. Secondly, since many sellers make decisions from an emotional standpoint rather than an empirical or strictly financial standpoint so having that rapport with them can give you that emotional edge that you need for them to select your offer over the others they have received.

Of course if you are writing an offer on a bank or corporate owned property this tactic will not be nearly as effective. But, as our market is turning around and there are more traditional equity sellers it is definitely something you should consider when you make on offer on your dream home.

If you are ready to start your search, visit our website www.LivingModesto.com or give us a call at 209-614-3303 or 209-505-3297. We look forward to hearing from you!

Why It Pays To Hire A Realtor When You BUY A House

It Pays to Hire a Realtor.

Sounds pretty cliché, right?

But actually it’s true.

I think it is pretty obvious to most people that hiring a Realtor to sell your home has its advantages- but in this blog post I am going to talk about why it pays to hire a Realtor when you buy a home.

The reasons are actually pretty simple.

As the buyer, it doesn’t cost you anything to use a Realtor

 Most people don’t know how I get paid when I sell them a house. At some point they will awkwardly ask me “uh, so do we have to pay you?”. The answer is always “no”. 99% of the time in real estate the seller is who pays the commissions to the agents. One argument against this point is that if there are no agents involved it costs the seller less money to sell and then may offer the home at a lower price to the buyer. Why is this wrong? If there is any money left on the table, trust me it will go in the seller’s pocket- not in the form of a discount for you.

Realtors have access to the most up-to-date information

Since the internet became the main staple for home-searchers many people think they can go online and in an evening find their dream home. While there are some great websites out there- there is something that almost nobody understands about that information. The platform Realtors use to “list” homes is called an MLS (Multiple Listing Service). The other websites that feature homes for sale get their information from the local MLS through something called an IDX feed. The accuracy and frequency of the updates of the information though is determined by the third party website. What this means is that what you are seeing may not be very current or accurate information because they can display it in ways that they see fit. In essence, if you are relying on those other sites for your info you will waste a lot of your time and likely get your hopes up over homes that are no longer available or not even for sale.

Your Realtor will hold the seller accountable to their disclosure duties

When you sell a home you are required by law to disclose certain things to the buyer. Most sellers (and definitely most buyers) have no idea what all those things are. It is the job of the agents to ensure that the seller makes the disclosures and that the buyer understands the disclosures.  Not knowing what the seller is obligated to disclose to you may cause you to buy a house that has major issues and/or defects that you can’t easily see, such as roof leaks, plumbing or electrical problems, flooding or drainage problems or even a past death on the property.

Your Realtor will ensure you get the right inspections

Along with the disclosures, buyers need to conduct their own inspections of the property. Not every property needs every kind of inspection though so it is important that you have an agent to guide you on what to get and find you the right professional to do the job for you. A proper inspection can help reveal issues that even the seller may not be aware of.

Not everyone is a candidate to buy on their own

If you are a seasoned investor and a friend calls and offers to sell you a house at a bargain, you will likely jump at the opportunity- and rightfully so. This is not the instance that this blog post is in reference to. When you have never bought an investment property and you still live in the only house you’ve ever bought 20 years ago, you are most definitely NOT a candidate to buy a house without representation. There is a litany of things that can go wrong that can cost you thousands and may land you in court.

You can’t rely on the escrow company to guide you

There is a misnomer with a lot of people that the escrow officer will help a buyer and/or seller with contracts. The inherent purpose of the escrow holder is to be a neutral third party between the buyer and seller. For this reason, they cannot get involved in the drafting of contracts and addendums and they cannot give advice on what either buyer or seller should sign or not sign. So if you are buying a home without representation assuming escrow will help you- you may be surprised (and feel a little lost) when they tell you they can’t help you.

 The bottom line here is this- know yourself. If you are the type of person who can’t buy a pair of shoes without guidance from your best friend you probably shouldn’t try to buy a house without the representation of a Realtor. A good realtor will give you their objective opinion and really help guide you in the right direction to protect your interests and your wallet.

If you are ready to start looking for a new home, call us today! We look forward to getting to work for you.

Fiscal Cliff-Dive Averted?

Unless you live under a rock or are just waking up from your New Year's Eve hangover you have undoubtedly heard that congress came to an agreement to help avoid the so-called "fiscal cliff".

The most notable aspect is the extension of the mortgage debt forgiveness. This was a temporary loophole in tax law that allowed for certain homeowners to be exempt from federal income tax on the amount of debt forgiven through short sale, foreclosure or loan modification. The new deadline is January 1, 2014.

The potential tax ramifications to most homeowners of paying income tax on an additonal $100,000 or more in income is pretty crushing for most people- and this is on top of whatever other financial burdens and hardships they are having. While this may not be the best news for our nation's deficit, it may be a step in the right direction to get our economy back on track.

This also comes as a relief to sellers who are in the process of completing a short sale on a home but weren't able to close before the end of the year.

If you are thinking a short sale may be the right option for you, call us today for a FREE no obligation consultation! We will help you look at your options and decide what is right for you.