Buying a home can be a fulfilling and exciting experience. With emotions running high, it is often times easy for a home buyer to skip crucial steps and make costly mistakes.
The following are three of the most common mistakes that home buyers make when purchasing a home:
When you finally find the property that you want, don’t play games. Work with your real estate agent and devise a reasonable offer based on available data – usually the recent sales of similar homes in the area.
It is common for some home buyers to believe that taking their time and making a seller “sweat” is a fair strategy to get the best possible home price. Don’t be so foolish! More often than not there are several others interested in buying the same home. When you find the home you want, go after it with full focusto ensure that you get it before it’s gone.
Another helpful tip is to not make too low of an initial offer, or ask for excessive repairs as a concession. Again, there are others looking at the same home and in the case of multiple offers, the seller will usually choose the reasonable one.
To be sure, when you sign your name on a real estate contract, you are committing yourself and resources to a large financial obligation. Although it is common sense to always read and understand all of the terms and conditions of any agreement, sadly many home buyers do not.
The best idea is to have your real estate agent go over your contracts with you, section by section to ensure that you understand what you are signing. Remember, real estate contracts are legally binding, it’s vitally important that you uncover any potential issues prior to signing.
Your home loan pre-approval amount should act as a guide – demonstrating what you could possibly pay for a monthly home payment if you maxed out your finances. Your loan pre-approval should not be the actual home price that you buy at.
The reason is simple, buying a home at the top of your price range may leave you “house poor.” (Which basically means you may be able to make the monthly mortgage payment and recurring expenses, but you will likely have no finances left over for recreation and other projects.
It is wise to remain within your comfortable payment range, instead of buying at the top of your approval level. Adhering to this train of thought, you should still have sufficient money left over each month to cover other expenses.
By consulting a local real estate professional, and avoiding these three common home buying mistakes, many home buyers (including you) can avoid the anguish and stress associated with the risky side of the home buying experience.
Buying a new home is often a complex and overwhelming process. From properly negotiating the sale, to filling out mortgage paperwork, there are so many moving pieces to closing on a property that buyers can be left feeling frustrated and bewildered.
For many, the solution to this stressful situation is to hire a real estate professional.
A real estate agent can walk you through each step of the home buying process, offering sound real estate advice as you go.
Here are four key areas that a real estate agent can help you with buying a home:
Providing your real estate agent with some of your financial details such as your annual income, personal savings, and revolving debt, they can assist you in acquiring a loan pre-approval with a reputable mortgage lender.
It is then between you and the mortgage bank or lender to discuss available financing options including: specific monthly payment amounts you can afford, and what you can reasonably expect for a down payment and final closing costs.
For most home buyers, choosing the right home is a highly emotional process. A real estate agent will assist you by offering objective market information about each property you find.
From local community and neighborhood information like the quality of schools and city zoning, to more home-specific details like roof condition and amenities, a good real estate professional can help you find exactly the home you’re looking for.
Once you have found your dream home, your agent will likely research data points to find recent comparable home sales of similar properties in the area to help determine a fair purchase price.
Based on the local real estate market data and comparable sales, as well as other factors like inspections and repairs, a real estate agent will then help you structure the right offer and then negotiate with the seller to get you the best possible price.
Closing on the home of your dreams, or settlement, can be quite a complicated process. In some states, an escrow or title company manages the closing process, while in other areas a real estate attorney handles the final transaction.
Sometimes there are closing delays such as loan underwriting, appraisals, inspections and surveys by a third party to the transaction.
This is where a good real estate agent is invaluable as they can ferret out any detail discrepancies and keep the other parties moving toward the finish line – closing on your new home.
Regardless of where you are closing, local real estate agents understand the lingo, guidelines and procedures that will help everything go smoothly.
By partnering with a knowledgeable local real estate professional who knows the ins and outs of the local market, chances are you will get the right home and walk away with a great experience.
Think that you are ready to buy a new home? If so, here are five best practices to implement in preparation for the new home buying process:
A great place to start is getting a full picture of your credit. You will definitely want to obtain copies of your current credit report. Also, be sure the details are correct, and consider fixing any potential problems you may find.
Next, find a reputable mortgage lender, apply and get pre-approved for a home loan. This will put you in the best financial position to make a well-priced offer when you find the perfect house.
Just like engagement rings, there’s a smart rule of thumb to go by when buying a home: approximately 2.5 x’s your annual income. There are a number of mortgage planning tools and loan calculators online that can show you how income, debt, and recurring monthly expenses affect what you can afford.
Remember, there are considerations beyond the sticker price, such as property taxes, energy costs, insurance, annual maintenance etc.
While the web offers home buyers access to home listings and online resources, many aspects of the home buying process require a level of home buying expertise you can’t pick up from surfing the internet.
Most often you’re better off using a professional real estate agent than hacking through the home buying process alone.
Where possible, consider recruiting an exclusive buyer’s agent who will have your personal and financial interests at the forefront of the purchase. Also, don’t be afraid to ask them to help you with negotiating strategies during the buying process.
Before making your first bid on a property, do some due diligence to determine the temperature of the local real estate market.
Are the current conditions more favorable for home sellers or buyers?
ALWAYS MAKE NOTE OF SALES TRENDS OF SIMILAR HOMES IN THE AREA OR NEIGHBORHOOD.
Be sure to look at home prices for the last few consecutive months to come up with an asking price that’s competitive and realistic.
You shouldn’t buy unless you’re sure you’ll be staying put for at least a few years, but beyond that you should always buy in a neighborhood with good schools as this will have an impact on your home’s resale value later.
As for the house itself, you should plan to hire your own home inspector that can point out potential problems that could require costly repairs down the line.
The details to every home purchase are going to be different, but if you stick to these 5 home buying best practices you will have a head start on a successful new home buying experience.
If you’re eager to jump into real estate investing, look before you leap, recommends Oliver Somoza, the founder of Turnkey Property Pro in Philadelphia. The best thing you can do is to take your time and do a lot of research on your local market conditions for home prices and rentals before you spend your money. Specifically, Somoza suggests:
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Urban dwellers often idealize what it’s like to live on acreage outside city limits, and there are indeed some advantages. Land costs drop in the country. The further away from the city you get, the cheaper acreage becomes. Many people buy land because they want to build a custom home to their own specifications. They also want cleaner air and more space.
But the realities of buying your piece of the country can cost you big time after closing. Obtaining a mortgage for your dream home might be tougher than you anticipated! Consider potential problems before you decide to dump urban living and buy land on which to build your dream home.
Finding skilled craftsman who are willing to travel to your location might be difficult. Those who are willing will probably charge more to compensate for driving the distance. Transporting building materials and paying for delivery will likely cost more than if you built a home in the city as well.
Although modern conveniences are usually available, they aren’t always reliable in the middle of nowhere. Many homeowners in the country keep generators as back up for times when utilities fail.
Going into town for groceries and other needs generally requires planning and long trips. And if it snows and the roads aren’t promptly and properly plowed, you could be stuck at home for days.
It might be a good idea to rent a home first before buying land and beginning construction, particularly if you’re unfamiliar with the area. You can get to know the community and hear stories from local owners that you won’t necessarily be privy to if you pull up in an SUV with a fat wallet in your pocket, asking about MLS listings.
Be aware of the pitfalls of this approach, however. All your neighbors might not be overjoyed to hear that you’re going to buy up that land behind their homes and erect your own palace there, obstructing their pristine views. You might meet up with some resistance—even organized resistance involving municipal and county authorities.
Resale value is often softer in the country than the city. That’s because the pool of potential buyers is smaller. If demand is low and supply is high, home prices will be more negotiable. As a tenant, you can try to time the real estate market and be ready to buy that parcel of land as soon as it becomes available.
Check with local authorities, including city, county, and state, to determine zoning ordinances. Find out whether you can build the type of home you want before you commit to buying the land. For example, a community within 20 minutes of Sacramento city limits doesn’t permit construction of any structure on parcels smaller than 20 acres.
Realize that you might be trading exhaust fumes from city buses for the lovely odors produced by pig farms. Some farm animals such as geese and donkeys produce squawks and brays that travel for miles. Horses along country roads drop steaming piles of waste. It’s not like anybody carries along a plastic bag and picks up after their horses.
Obtain a natural hazard disclosure and look for soil problems. A disclosure will tell you if the land is a protected habitat, which would prohibit building. Is the area a known fire hazard? Is the fire department supported solely by volunteers? Many homeowners in the country maintain private ponds for fire emergencies.
If the land is located near hills, how likely is it to move? Some slab foundations can crack if the land is unstable. Find out if your parcel lies within the path of a potential landslide. You might want to consider building a raised foundation and make sure you have flood insurance if you construct near a body of water.
Obtain an easement and make sure it’s recorded if access to your land is provided by driving across an adjoining parcel. Find out who maintains the roads and what your pro rata cost share might be for upkeep.
What rights do neighbors have to cross your land? Are the boundaries clearly marked? Obtain title insurance. This will disclose easements and restrictive covenants or conditions. You might want to order a survey of the land as well.
Water is important, and not all water is potable. Sometimes water rights don’t “run with the land,” which would mean that you couldn’t dig a well.
Find out the depth of your water table and determine the difficulty of digging. Is the ground mostly rock?
It can be costly to bring electricity, telephone, or cable service to the property if they’re not already established nearby. Will you need to install a propane tank? What will it cost to install a septic system if you can’t hook up to a sewer?
If so, you’ll probably want to get rid of it, but proceed carefully. Depending on the size of the structure or building, you might need a professional demolition contractor to reduce it to rubble and haul the rubble off, and this can be a considerable added expense.
You might also need local permits for this type of work, and if utilities are available to your location, make absolutely sure they’re turned off ahead of time. The contractor will most likely take care of this for you, but double check.
If you’re not planning to finance the land purchase through a conventional lender—which would require a lender appraisal—obtain your own appraisal to determine an appropriate price before making an offer. Comparable sales are sometimes difficult to find when you’re buying land.
It’s common to pay cash for land because getting a loan for this type of purchase can be tricky. Raw land can’t be leveraged by a bank.
If you do get a loan—and there are a few lenders out there who specialize in and will touch this type of transaction—don’t expect to be approved for more than maybe 50 percent of the purchase price. You might have more success if your land has utility access and is reasonably accessible by roadway.
Of course, a construction loan to build your home is something else entirely. In this case, the structure can act as collateral. Some financing will allow for subordination to a new construction loan.
The post Tips for Buying Land in the Country to Build a New Home appeared first on Terra International Realty.
It is normal to harbor fears about making the wrong decision when you’re looking at homes to buy. Many first-time home buyers wonder how they will know when they have found the right house.
Here are 3 preliminary things you should know about finding the right house:
If You Have Found the Right House, Can You Sleep On It?
Right now, you might be wondering how you will know that you have found the right house if you don’t sleep on it. What’s wrong with sleeping on it? Everything is wrong with sleeping on it. Trust yourself. Don’t second guess your instincts. Your instincts will not steer you in the wrong direction.
Have you heard the phrase: shuffle your feet, lose your seat?
Somebody else could buy your house out from under you while you’re counting sheep. You might not know it, but there are other home buyers with similar intentions looking at homes today in the very neighborhoods where you want to buy.
The last thing you want to hear your buyer’s agent say is another buyer made an offer, and it was accepted minutes before your offer was submitted. Happens all the time, too. Unless you’re buying a brand new home, there is not another home around the corner just like the home that now you can’t buy. When you find that house, buy it.
Part of the excitement of looking at homes is not knowing which could be your new home when you pull up to the curb. Is it the one on the left, or does the house on the right strike your fancy? If it is the house on the right, and you like it better than the house on the left, that could be a sign. It means there is something about this house that appeals to you. Curb appeal is talking.
Within three seconds of entering the house, you will know whether it feels warm and comforting. Does it seem to speak to you? Does the house invite you to explore? Does it feel, well… Right? Like home? Then it probably is.
Sometimes buyers feel so uncomfortable near a bathroom that they won’t walk into the room. They are afraid to let their feet touch that bathroom floor. They will stand outside, grab the door frame, and poke their heads in for a minute. If you can walk into the bathroom and feel compelled to open the shower door or stroke the vanity marble, this is your house.
Maybe your agent points out a flaw and says, “There is a stain in the kitchen sink,” and you want to slap them for saying something so mean about this house. You want to defend every flaw you see. If you even see the flaws, because right now, flaws do not matter. You’re falling in love.
If you walk into the master bedroom and can immediately envision your bed against a particular wall, this might be your house. If you find yourself thinking that the living room window is a perfect spot to put a tree come Christmas, you’re already hooked.
Perhaps deep purple is not your favorite color. Maybe it’s blue. Maybe you’re thinking those purple walls in the kid’s room would look better in a pale blue jean color. You might even know the name of the paint color you plan to use because you’ve been thumbing through Pottery Barn catalogs and this home looks just like those.
The dynamics might not hit every bullet point on your list, but it meets the basic requirements. The house has the number of rooms and space you need. Maybe it doesn’t have a garage, and in a flash of enlightenment, you realize that buying a house with a garage is not important. Maybe you suddenly realize you could build a garage. Being flexible about which issues are deal-killers is a good quality to develop.
All of the other homes you’ve been looking at no longer appeal to you. The homes on that list you’ve been carrying around seem insignificant. Moreover, the homes you had previously rated a No. 8 have now fallen to a No. 2 rating. The homes you have seen pale in comparison. You would feel like a traitor to this home if you went to visit other homes. This is it. I’m telling you.
It would not be unusual for you to snap a few photos to upload to Instagram before you’ve finished touring the home. You feel excited. The excitement seems to manifest itself. You shoot more photographs. Suddenly your phone is in burst mode, and before you realize it, you have hundreds of photos.
Except for that nagging little thought – that wonders if you should sleep on it – every other thought in your head says this is the perfect house for you. You are consumed. You can’t think about anything else apart from owning this house. Dinner? Who needs to eat? You need this house. You wonder if you should be committed or see a doctor. Yup, this is your house. Just do it.
The first question many agents generally hear from buyers after closing is: how do I remove the photos of my new house from Zillow and all of the other real estate websites? They think the listing agent will do it for them, but it is not that easy.
It starts with MLS. Sellers want their home advertised everywhere possible online. Increasing the exposure to online shoppers tends to maximize profit potential; their thought process is the more websites, the merrier. Many websites feed from MLS. Sellers don’t necessarily care about the ramifications or the buyers’ privacy after the transaction closes
A funny thing happens, though, after buyers become homeowners. Although the buyers may have lusted after their new home on their smartphone prior to purchasing, right after the sale closes they may suddenly feel differently. What was once a fantasy becomes a reality. They now claim ownership, and ownership feelings can be intensely and extremely private. So private, in fact, that they feel invaded by the online photos. They want to stop anybody else’s eyeballs from falling upon their built-in dishwasher or 6-burner range.
Legal opinions can vary, but most lawyers agree the photos do not belong to the homeowner, nor does the homeowner have the legal right to demand the removal of the photos. Furthermore, some of them simply cannot be removed.
To figure out how to remove photos of your home from real estate websites, it helps to begin by understanding how the photos ended up there in the first place. It starts with MLS. Depending on your local MLS, that system might distribute its contents downline to 20, 60 or 100-plus different websites. Automatically. This includes popular homes for sale websites such as Zillow, Trulia or Realtor.com: the big three.
For many years, agents could just post listings to Zillow. However, Zillow’s policy now prevents it, and it has negotiated feeds directly from MLS companies across the country.
Each website might also distribute the data to its sister websites. Agents might blog about their new listings on social media–like Facebook, Instagram, Twitter, and Pinterest–and post photos. In the case of Pinterest, other users can then snatch the photos to “pin” on their own page. It’s like a never-ending galaxy that often leaves the homeowner in a black hole.
The single best way to remove photos of your home from real estate websites is to ask for this in your purchase offer. Make the removal of those photos from MLS a contingency of sale. This means once you have removed your contract contingencies and are close to funding the loan, you might ask the listing agent to immediately remove all photographs from MLS. Keep in mind, however, this doesn’t necessarily mean removal from other websites or social media platforms.
If you’ve already closed and you want the photos removed, start with the listing agent. Be polite and nice. State your case. You might even suggest that you realize the request might seem insignificant to the agent, but you would appreciate if the agent could take a moment to remove the photos from some of the websites to which the agent has access, such as Zillow.
The agent is under no obligation to grant your request; however, many real estate brokerages and–by extension–the agents themselves, prefer to foster goodwill in the community and might help you out.
You can also remove photographs from Zillow yourself by creating a Zillow account. Then, sign in to your account and claim the home. Once the home has been claimed by you, you have the ability to remove photographs. Zillow customer service representatives can also assist if you find this step challenging. Zillow feeds its listings to Trulia, so once removed from Zillow, the photographs will also vanish from Trulia.
Most other websites, with the exception of MLS, will remove photos if you ask their customer service department for assistance. MLS is fairly strict and does not want to alter its research archives. To find these websites, enter your home address into the search box of your favorite search engine. For example, I entered the address of a random home I sold six years ago, just to count the number of entries that still exist. This home was still listed on 72 entries, some with photos and some without.
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It’s not unusual for home buyers to sometimes think the world of real estate would be a whole lot easier if only sellers and buyers could just sit down together and discuss an offer. But there are a lot of reasons to hire real estate agents. It is also entirely possible that you could alienate the seller if you try to bypass the listing agent and call the seller directly.
While sellers may feel comfortable showing you around their home and talking about their home improvement projects, most do not want to discuss terms of an offer directly with a buyer. If they wanted to sell as an FSBO, they would not have hired an agent. If you call the seller, you take the risk of alienation.
Not only do sellers tend to feel uncomfortable talking about the terms of an offer, they don’t want to bypass their agent because they believe their agent knows more about real estate than they do. They trust their listing agent. A real estate agent offers a seller knowledge, experience, and a fiduciary relationship.
An agent acts as a buffer between the parties because, let’s face it, a buyer’s goal is probably to buy that home for the lowest price possible, and the seller’s goal is to sell that home for the highest price possible. Those are opposite goals. The seller could view your position as adversarial, and if you try to call the seller, you could solidify that viewpoint.
A buyer chooses a buyer’s agent to represent their best interests. Even though the seller ends up paying the buyer’s agent via a commission split, the buyer’s agent is still responsible only to the buyer. It is the buyer’s agent’s job to present your offer to the listing agent. If you’d like your agent to present your offer directly to the seller, your agent can ask the listing agent for permission to do so. In those situations, though, the listing agent is still usually present with the seller.
If you feel that your buyer’s agent is incapable of representing you to the extent that you feel a need to bypass the agent, you should probably hire a different agent.
A few years ago, a buyer wanted to buy a Colonial in Midtown Sacramento. He felt that the listing agent did not want him to buy the home, for unknown reasons. The buyer believed the listing agent might have drawn a counter offer and asked the seller to sign the counter offer without explaining the ramifications to the seller.
The buyer went to the seller’s house, knocked on her door and expressed his concerns. The seller was polite but distant. After the buyer left, the seller called her agent to complain. This made the listing agent upset. The listing agent was uncooperative from that point forward, and the buyer did not buy that home.
In another transaction, a listing agent explained to a buyer’s agent what the buyer needed to do to buy a short sale. The buyer did not believe his agent and fired his agent. Then the buyer went directly to the seller.
The buyer was a younger male and the seller was an older, single woman. The seller interpreted the buyer’s exaggerated excitement for aggression, and she relayed her fears to her listing agent who, in turn, contacted the buyer’s agent.
The buyer asked if he could work directly with the listing agent. By this time, his tactics had alienated everybody involved, including the listing agent. The buyer sabotaged his own transaction. In the end, nobody wanted to work with him, much less sell the home to him.
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Real estate can be a tremendous investment opportunity. And for those who are in for the long run, rental properties really can’t be beat. But when it comes to taking that crucial first step, most people aren’t sure where to start.
If you’re in this boat — looking to get started with real estate but leery to dive in — don’t worry. That’s a good sign. Being careful with any investment is always a good idea, and real estate is no exception. The more prepared you are, the greater your chances of coming out on top.
If you are thinking about investing in real estate, here are 10 considerations to help you to get off to a great start.
Before you take the plunge, take stock of your financial situation. Is there anything that you can do to put yourself in a stronger position to invest? Things such as paying down or consolidating debt, along with working on improving your credit score, can help you to qualify for a better loan. You’ll also want to save up for a down payment. A larger down payment is ideal for reducing your monthly payments, your insurance and even your risk.
Next, you’ll want to learn as much as you can about real estate investing and rental property management. Brush up on the basics of landlording, and get some good books that offer sound investment advice. There is a lot more involved with becoming a landlord than meets the eye, and being prepared will help you sidestep many common pitfalls along the way.
While you may feel pressured into “going big” when it comes to your first investment, there’s nothing wrong with starting small. In fact, it’s how many successful investors get started. Starting small offers a number of benefits; namely, it’ll give you a chance to gain an understanding of how investing works before there’s a lot more at stake.
Before you commit to a property, it’s important to know exactly what type of returns you’re looking for. Start by establishing your investing criteria, and resolve to only invest in properties that meet your standards. So be sure to have an idea about cap rate and cash-on-cash returns, along with net yield and cash flow.
As a new or first-time investor, you might be looking at property that’s close to home. However, be careful that you’re not limiting yourself. When you open yourself to the possibility of an investment property outside your local area, you’ll be able to take advantage of up-and-coming markets that may have better opportunities. With the property management options and resources available today, investing in out-of-town property is easier than ever.
Investing is a business, and you should treat it like one. Just as you’d have a solid business plan in place for a company, along with clear and actionable plans, key milestones and systems, you’ll want to do the same for your investments. Remember: Your goal is to generate a profit, so make sure you lay the groundwork necessary to do so. Don’t simply invest in the first property that catches your eye. Just as you would in a business, make sure every opportunity checks out.
Securing a mentor is one of the best things that you can do if you’re new to the world of investing. What better way to learn than by seeking the advice of someone who’s been there, done that? If you’re not sure where to start, consider partnering with someone who may be able to offer you solid advice in their field — for example, a good investor-friendly real estate agent. You’ll also want to peruse the Bigger Pockets investing forums, where you can find plenty of experienced investors who are willing to offer helpful advice.
Along with finding a mentor, you’ll also want to start building a social circle. Work on building relationships with other investors and real estate agents. You never know when they might be able to help you find a winning deal. It’s hard, if not impossible, to succeed on your own. Fortunately, there are plenty of people out there who are willing to lend a hand. Seek to connect with them.
Implementing systems is vital, especially as it pertains to tenant sourcing, screening and management. Having a system for tenant screening, for example, will allow you to ensure that you screen each applicant equally and fairly, helping to prevent harmful accusations of discrimination. If you’re not able to put the time into creating systems yourself, you’ll want to outsource the work of property management to a reputable firm or manager.
Finally, while there are a number of benefits to real estate investing — including equity growth, tax breaks, leverage and appreciation as your property, ideally, increases in value — the primary benefit of real estate investing is cash flow in the form of monthly income.
A property that is producing a solid 10% or higher return is “cash flowing,” and it’s a good deal. But if it’s not, then you’ll want to reconsider.
While buying an investment property can be a nerve-racking time, it doesn’t have to be. Being informed can help you to ensure that you’re getting off to the best start possible. So brush up on your real estate investing best practices, and then get out there and take that crucial first step to start growing your own rental empire.
Buyers have a myriad of reasons for wanting to change agents. Perhaps they can’t adequately answer your questions, don’t respond promptly to inquiries, or appear more interested in their own needs than yours.
If you have found a second agent and perceive that individual as possessing the qualities you desire, then you probably have ample grounds for switching agents. Some type of conflict is inevitable, but you can make the transition somewhat easier on yourself.
Note that if you have not signed a buyer’s broker agreement, you are not owned by any real estate agent. No agent has a claim on you, and you can switch to another agent you prefer at any time.
But if you have signed an agreement and wish to work with someone else, here are three things to consider:
If you have signed an agreement, it may contain important language that you need to be aware of. Check for a cancellation clause. This will allow you to legally part before the contract expires. You should also look for conditions that may have been written in the event you want to terminate the agreement before it expires. For example, there may be an exit granted with a specific period of time, say 48 hours’ notice. Both the broker duties and buyer duties will be written out. If your broker is in breach of these duties, you can report that or simply create a list of grievances and refer to the contract once you’ve made the decision to stop working with that broker.
There may be a termination agreement written into the contract already that supports either party wanting to end the relationship. The rights to termination will be clearly stated. Generally, you should be able to cease working with the real estate agent with a letter of cancellation or termination. Check your contract for this language. And make sure you get a signed termination letter from the real estate agent so that you can prove your parting is legitimate.
Even if you have a list of grievances, be professional and courteous. Acknowledge that your specific needs aren’t being met as a platform to learn from for the future. A good real estate agent will ultimately agree that it’s in your best interest to end the relationship, especially if the telltale signs have been apparent for a while. By being honest and upfront, and parting amicably, the relationship may be able to continue in other ways. A good real estate agent may even suggest other agents to work with or even make referrals.
You can say that you would like to continue to work with the real estate brokerage firm overall, if your broker is a part of a larger entity, and ask if there is a colleague he or she might suggest if you are indeed parting on good terms. That way, you save the overall relationship with the firm.
But if you feel strongly that you don’t want to get into any specifics, you can simply thank the agent for his or her time and inform them that you have chosen a different agent.
This is an important step in order to protect yourself from having to pay any commission if an issue were to arise after you’ve terminated the relationship. Do this after you have informed the agent you would like to end the partnership. You don’t have to explain why, but do outline it when you want to officially part ways. That will ensure that the agent doesn’t continue to search properties for you.
Capstone Asset, a start-up real estate development firm jointly owned by Thai and Hong Kong investors, expresses their positive outlook toward the Bangkok property market. The newly established developer is eyeing a mixed-use project including Grade B office spaces to maximise the market’s limited supply.
Daniel Yu, Capstone’s executive director and co-founder, told the Bangkok Post that the company sees the property market in a positive light because Thailand has proven to be a resilient property market with plenty of opportunities to different real estate projects.
Mr Yu qualified his response, however: “We [Capstone] are not worried, but we must be selective because the entire market is not attractive. It is more difficult to get a freehold plot in good locations to develop a mixed-use project because of high land prices.”
Capstone has been in discussions with a landlord to lease a strip of land that is within walking distance from a BTS station, outside of the central business district area. Besides Grade B office spaces, the project will also accommodate retail stores and a hotel.
Grade B offices that are 800 and 850 baht per square metre per month are investment-worthy in view of limited supplies, according to Titiwat Kuvijitsuwan, also an executive director and co-founder of Capstone.
Former colleagues at SET-listed Minor International, a hospitality firm, Mr Titiwat and Mr Yu co-founded Capstone early this year. The company is marketed as a boutique development firm that focuses on the lifestyle sector.
Prior to the development stage, Capstone was involved in a joint venture with Asset Five Group, a residential developer. Together, the two companies developed Tonson One Residence – a 2.85 billion baht luxury condo.
The project will stretch out across a 385.3 rai plot of land on Soi Tonson, along Phloenchit Road. Around 2.5 million baht per square was paid to the Suthat Na Ayudhya family plot in 2018 just to make this project possible.
Once completed, the 19-storey tower will have a total of 80 units. The smallest units will be 57 square metres while the biggest units will not exceed 387 square metres. Expected price range is between 300,000 and 500,000 baht per square metre or 20 million baht at the very least.
CBRE Thailand says luxury and super-luxury condo supply in the Phloenchit-Lang Suan area accounts for 6 to 8 per cent of the total condo supply in the capital city.
The Phloenchit-Lang area also has record land prices:
Lease option sales first became popular financing instruments in the late 1970s and the early 1980s. They were used primarily used as a way to circumvent alienation clauses in mortgages, but they have some other advantages as well. Proponents claimed the sale was not a sale because it was a lease, but courts have argued otherwise.
Today, options to purchase, lease options, and lease purchase agreements are three separate financing documents. They’re very similar, but they differ in the finer details.
The variances are state-specific and not all states have identical laws. Consult with a real estate lawyer before entering into one of these agreements with a seller so you’re sure you understand its implications.
The buyer pays the seller option money for the right to purchase the property later when he enters into an option arrangement. This option money can be substantial, or it can be as little as $1.
The buyer and the seller might agree to a purchase price at that time, or the buyer can agree to pay market value at the time his option is exercised. It’s negotiable, but many buyers want to lock in the future purchase price at the beginning.
The term of the option agreement is negotiable as well, but the most common duration is generally from one year to three years.
Option money is rarely refundable. Nobody else can buy the property during the option period, but the buyer can sell the option to somebody else.
The buyer isn’t obligated to buy the property. If the buyer doesn’t exercise the option and purchase the property at the end of the option, the option simply expires.
A lease option works much the same way. The buyer pays the seller option money for the right to purchase the property later. In this case, however, the lease option money can be substantial.
As with an option, the buyer and seller can agree to a purchase price at the inception of the agreement or the buyer might agree to pay market value at the time the option is exercised. It’s negotiable but, again, most buyers want to lock in the future purchase price at the beginning of the lease option agreement.
The buyer agrees to lease the property from the seller for a predetermined rental amount during the term of the lease option agreement. The term is also negotiable, like an option, it’s usually from one year to three years.
The option money generally does not apply toward the down payment, but a portion of the monthly rental payment can apply to the purchase price. Option money is rarely refundable.
Nobody else can buy the property during the lease option period and in this case, the buyer generally cannot assign the lease option without the seller’s approval.
If the buyer doesn’t exercise the lease option and purchase the property at the end of the term, the option expires. The buyer is not obligated to buy the property.
It is another variation on the same theme with some minor differences. The buyer pays the seller option money for the right to purchase the property later. The buyer and seller agree on a purchase price, often at or a bit higher than current market value.
During the term of the option, the buyer agrees to lease the property from the seller for a predetermined rental amount. The term of the lease-purchase agreement is negotiable, but again, the common duration is generally from one year to three years.
The buyer applies for bank financing and pays the seller in full at the end of the term. The option money generally does not apply toward the down payment, but a portion of the monthly lease payment goes toward the purchase price. The monthly lease amount is typically higher than the fair market rental value for this reason.
Option money is nonrefundable. Nobody else can buy the property unless the buyer defaults. The buyer typically cannot assign the lease-purchase agreement without the seller’s approval.
Buyers are often responsible for maintaining the property and paying all expenses associated with its upkeep during the term, including taxes and insurance, and they’re contractually obligated to buy the property.
Hire a real estate lawyer to draw up the documents and explain your rights, including those of possession and default consequences, if you decide to take one of these routes to home ownership or to sell your property.
The property might be encumbered by underlying loans that contain alienation clauses, giving the lender the right to accelerate the loan when the owner enters into such an agreement. You’ll want to look into this.
Sometimes sellers give the option money to their real estate agent as full payment of commission. Agents aren’t always involved in the exercise of lease options or the fulfillment of lease-purchase agreements, and you’ll probably still need a real estate lawyer even if you’ve retained real estate agent representation. Agents are not lawyers, and they can’t give you legal advice.
Obtain all the disclosures and do your due diligence just like you would with a regular sale. This means getting a home inspection, examining the title policy, getting an appraisal, and reading any and all seller disclosures.
Consider obtaining pest inspections, a roof certification, a home warranty plan, and hiring other qualified inspectors as well.
Lease purchase agreements are commonly offered by owners of hard-to-sell properties. Think about it—the owner would sell it to a conventional buyer who would pay the seller cash if the property was a plum and easy to sell.
Sellers generally get market value at today’s prices and relief from coming out of pocket for the mortgage payment on a vacant property during the term.
Although the lease payments can exceed market rent, the buyer is building a down payment in some cases and she’s banking that the property will appreciate beyond the agreed-upon purchase price.
Buyers generally make a small down payment with little or no qualifying and this makes a lease purchase an attractive way to ease into the benefits of homeownership.
Buyers enter into a forced savings plan when part of the lease payment is credited toward the purchase price at the end of the lease option agreement.
If the buyer defaults, the seller does not refund any portion of the lease payments or the option money and he can retain the right to sue for specific performance.
The Internal Revenue Service can and has classified these transactions as installment sales, not leases. Special rules can apply to them at tax time.
A portion of the buyer’s rental payments can sometimes be categorized as interest and would, therefore, be tax deductible to her.
As for the seller, the option payment can be treated as a down payment or the initial payment of the transaction. The total amount of the payments can ultimately contribute to a capital gain or loss, both of which have tax implications. Rental income also contributes to capital gains.
The seller can no longer claim depreciation on the property if it’s considered that he no longer owns it—he entered into an installment sale.
Several other potential tax rules apply as well so you might want to consult with an accountant prior to entering into such a deal.
For more information, contact a real estate lawyer. This information is an overview and is not meant to be construed as legal advice.
Spring is the optimum time to sell a home. Regardless of whether it’s a hot, cold or neutral market, inventory almost always rises in the spring because the largest number of buyers are actively searching for a new home during April, May, and June.
If your home has been languishing on the market since the holidays, take it off the market. Give it a chance to “cool down” for a few weeks before putting it back on the market.
Nobody is going to look at your home in the spring if it’s been on the market for months. The Days on Market (DOM) matters to home buyers because buyers gravitate toward fresh, new listings. Below are other things you can do to improve the odds that your home will stand out among the sea of new listings flooding the spring-time real estate market:
Give these tips for selling your home during springtime a try.
Sparkle is free, and it sells homes. A potential buyer may not realize why your home seems so inviting but will feel drawn to it if the windows are spotless and your mirrors reflect sunlight. Cleaning is the first step in preparing your home for sale.
Clean out dead leaves and debris in your lawn. Don’t let overgrown vegetation block the windows or path to the entrance. Cutting bushes and tree limbs will let the sun inside and showcase the exterior of your home.
Artfully-manicured lawns are given an edge and tell buyers you pay attention to small details. Diagonally mowed lawns make your yard appear larger.
Yellow flowers specifically stimulate buying urges. After a long winter, everybody is anxious to see the first signs of spring. Yellow tulips and daffodils induce feelings of happiness and contentment. Arrange containers in groups of three or five near the entrance.
Send your window coverings to the dry cleaners or wash, dry, and press them. Toss blinds into a soapy bathtub for a quick wash. Get rid of all accumulated dust and spider webs. Crisp linens and a spring-time breeze through the windows invite the season inside.
Freshly-cut lilac branches or peonies bring life to your space. Why not flatter your neighbors and ask if you can borrow flowers from their yards? Natural scents are more appealing than artificial, and trigger fewer allergies among those susceptible.
Peony vases are designed to hold peonies upright but wash the flowers first to avoid carrying ants inside. Clever home staging brings color and fragrance indoors.
Your hardwood floors should be refinished, if necessary. Make your ceramic and linoleum floors twinkle and shine. Bleach dull grout and thoroughly clean all area rugs.
Even if it means replacing items, towels, linens, throws and sofa pillows are inexpensive accents you can buy. In soft spring colors, they will light up a room. Layer towels on bathroom towel racks and place rolled washcloths on the counters in a fashionable pyramid.
No matter where you live, spring weather is often unpredictable. In some states, it can be 72 degrees one day and snowing the next. If it’s raining, give buyers a place to stash umbrellas and wipe their feet before entering your home.
Some sellers lay down plastic runners across floors for protection, but that tends to ruin the effect of a glittering polish job.
Stationery and party supply stores sell helium balloons for about a dollar each. So, there’s no reason not to pick up a dozen balloons to tie to your open house signs. Balloons build excitement and will get your home noticed by home shoppers.
Don’t skimp on your home marketing materials. You want home buyers to select your flyer among the dozens they pick up, and color gets noticed more than black and white.
Show home buyers how easily they can afford to buy your home by giving them two or three financing options. The first thing on buyers’ minds when considering a home purchase is the monthly mortgage payment. Don’t make them guess.
Spend a little more on newspaper and online advertising by including a color photograph in your ad. Remember, a picture is worth a thousand words. Look through your photo galleries for a seasonal photograph that flaunts your home to its best advantage.
Call a local title company to obtain a free direct-mail list of your surrounding neighbors. Print oversized postcards in color and include a UV coating to give the marketing oomph. Top it off by using first-class postage.
Put a dozen or so bottles of water in a sink of ice for buyers. You can also tape labels to the bottles, printed from your computer, with your phone number, a photograph, and address of your home.
Touring homes makes buyers hungry. Give them a snack. It will give buyers an opportunity to linger in your kitchen and marvel at its elegant touches which might otherwise be overlooked.
In 2018, Chinese nationals poured in an impressive 40 billion baht ($1.25 billion USD) on Thai properties, as reported by the Bank of Thailand.
Chinese buyers were also the biggest source of condominium purchases. Other large-scale condominium spenders include citizens from Japan, Singapore, Singapore, Taiwan, the United Kingdom and the United States.
There has been declining interest from Russians, who have invested much Pattaya and Phuket condominium markets for several years now. Colliers International property analyst Phattarachai Taweewong attributes this drop in interest to a weaker rouble.
Carrie Law, CEO and director of Juwai.com, the biggest property website in China, said that low prices and taxes in Thailand were particularly appealing to Chinese buyers.
She further added: “Canada and Australia have declining property markets and new foreign buyer taxes. This helps drive investment away from those countries. Thailand does not impose extra taxes on foreign buyers. Prices start in the low US$100,000s. That’s very appealing.”
Juwai had an overwhelming number of Thai property enquiries in 2018. Its total sales in Thailand topped last year’s charts for the first time. Once popular property markets like Australia and Canada dropped to second and fourth place, respectively, with this huge interest in Thai property.
Many property buyers hail from some of China’s most progressive areas – Beijing, Guangdong, Jiangsu Shanghai and Zhejiang. According to Law: “Beijing has a strong lead, with nearly twice the share of buyers that either Shanghai or Guangdong has.”
Juwai.com notes that approximately half its buyers said they purchased property for personal use. 15 per cent of Thai property buyers needed a holiday property. 6.3 per cent of property buyers said they want a property for their retirement years. Around 70 per cent of all Chinese property buyers told Juwai.com that they hope buying real estate in Thailand would prove to be a good investment.
Foreigners may occupy 49 per cent of condo units in any condo building in Thailand. They cannot own land, however.
Bangkok-based Phoenix Property Development and Consultancy analyst, Surachet Kongcheep, said property in Thailand is “not too expensive”. Because they’re relatively cheap, Chinese buyers invest in units that are below 3 million baht.
According to Phattarachai, Thai properties in China were so popular in China that condo units promoted in the mainland “were sold out before the domestic sales”.
Thailand is currently on the verge of a supply bubble in the property market, he said. Compared to the usual 40,000 to 50,000 units launched each year, there were around 58,000 new condominium units in 2017. 66,000 new units were also built last year.
The Bank of Thailand imposed tighter lending policies to regulate the property market and prevent any real estate bubble. This, however, has made it difficult for Thai people to buy homes. In effect, property sales slowed down.
On the brighter side, experts say foreign buyers, especially Chinese investors, will keep the Thai property market afloat
Phattarachai said: “foreigners paid 92 billion baht (US$2.88 billion) to obtain properties last year, compared with 70 billion baht in 2017. We expect the figure to reach 100 billion baht this year.”
Chinese industrial investors will also be an asset to the property market as they transfer their production bases to Thailand. Juwai.com’s Law said this will help lessen the effects of the US-China trade war.
“Thailand is one of the biggest beneficiaries of the trade war due to its excellent logistics, sophisticated manufacturing and export sector, and a cost of labour that is less than half of China’s,” she added. Because of close commercial ties, we can expect more property investment in the future.
Marketing your home becomes easier if you can identify the current real estate market. Agents tend to put a lot more money and work into selling listings when markets transition from seller’s to buyer’s markets but strong marketing techniques are just smart business sense regardless.
Some homes cry out for drone photography, especially if they’re situated on the waterfront, in the mountains, near a park, or on large acreage. An aerial view would be an important advantage to showcase the surrounding neighborhood in these cases.
Another interesting element that’s often utilized in luxury home marketing is a night view of the home illuminated by outdoor lighting.
Good marketing can bring higher prices in a seller’s market and it can mean the difference between “sold” or “expired” in a buyer’s market. Good marketing might not sell your house but it will make the phone ring and if buyers don’t call, you won’t sell.
Most home buyers begin a home search online so posting good photos is essential. Listings without photos or with only an exterior shot are often ignored. But that doesn’t mean an exterior shot from the front isn’t very important.
Your house photo will look 10 times better than your competition’s if you crop out sidewalks and streets. Remove vehicles from your driveway and from the front of your home. Shoot both close up and angled photos and avoid shade falling on the house — wait for another time of day if necessary. Clear away any vegetation that’s blocking the front door or the path to door.
Take pictures of the clubhouse, pool, spa, or tennis courts if you own a condo or townhome without a yard. But keep in mind that buyers will want to see it if you do have a yard.
Emphasize space and shoot long. Mow the lawn and trim the bushes. Remove any evidence of pets and put away children’s toys. Avoid shooting into the sun.
Take photographs of every room even if you suspect that a certain room won’t photograph well. Shoot it anyway because the photo quality might just surprise you. It might be usable.
Open drapes and blinds and turn on the lights. Focus on interesting details like the condition of a wood floor or a fireplace mantle. Remove trash cans and close the toilet lids in the bathrooms and use floral arrangements in kitchens and dining rooms.
Avoid shooting into mirrors because your image will reflect.
Virtual tours aren’t just for showcase million-dollar homes anymore. Every home should have one, even if it’s only two spins. Buyers love, love, love virtual tours.
A good virtual tour will grab a buyer by the hand and lead her from room to room, whether it’s 360 or a video. Depending on the tour company, you can add sound, music, or an exciting, professionally written description that scrolls with the movement of the tour.
Virtual tours can also include individual photos available for download or to print.
Signage encourages home shoppers to immediately call you or your agent. It’s free advertising! A well-designed “For Sale” sign will generate phone calls. Put up two signs if your home is on a corner lot.
Keep in mind that some homeowner’s associations prohibit real estate signs. They only allow window signs.
Try talking to a neighbor whose home is located near the corner of a busy street, asking for permission to put a sign in that yard with an arrow pointing toward yours.
Agent signs should include the phone number of their closest office when their brokerage operates multiple offices. They should also include the agent’s cellphone number.
Print advertising reaches buyers who read newspapers and online ads reach the rest. You’re doing a good job if your neighbors say, “I see your home advertised everywhere I look!”
Put ads in major newspapers. Find out which days pull the most readers. It’s usually Sunday but some newspapers also publish “picture classifieds” on other days.
Don’t overlook local newspapers. You can often run a larger ad for less money that will more closely target those who are looking in your specific area.
Check on press dates before you place ads in real estate publications. And finally, make use of every website you can find, as most online listings are free.
You can buy mailing lists from list brokers if you’re an unrepresented seller. Ask about a direct mail program if you’re represented by an agent. Oversized four-color postcards are good because they’re inexpensive to mail and they’re eye-catching.
Give them to neighbors. Everybody has friends and relatives who might want to move near them. Give them to agents who represent buyers in your neighborhood and to buyers who live in other areas and often relocate to your neighborhood.
Not every home is suitable for an open house because of its location or other factors, but sometimes the only way to find out is to try. If nobody comes, that’s probably a good indication.
If your home is located near a high traffic area where buyers often swarm, it’s probably a good candidate. Place open house signs throughout the area directing buyers to your location. Advertise your open house in the newspaper and post open house times online.
(Don’t forget to invite the neighbors. They’re going to come anyway.)
You can skip this step if you’re planning to sell your home without representation, but it’s a good idea to draw as many agents and brokers as possible to view your home. Most buyers are represented by agents.
Agents who linger in your home will better remember details to later describe to buyers and the best way to entice an agent to hang around is food. It doesn’t have to be anything expensive. Sandwiches will suffice. The hope is that they’ll admire your home as they munch and network, then they’ll bring back a buyer.
Technology has made it very easy to create and send electronic flyers. You can include multiple photographs of your house. Costs vary but these generally aren’t prohibitively expensive to produce.
Send them to real estate agents who sell in your area and to friends, family, and coworkers. Out-of-area brokers and agents who represent buyers in your area can be targets, too.
This one isn’t a suggestion — it’s a must-do. Your listing agent will certainly make sure your house is listed in the Multiple Listing Service if you’re represented. But even if you’re not, the MLS can accommodate for-sale-by-owner listings.
Find a discount broker who’s willing to enter the information about your property for you without actually representing you. Many will do so for a flat fee. Posting your home here will make sure that many, many agents and buyers are aware of its availability.