Wednesday, December 12, 2012

Ten Common Issue’s found in Home Inspections


Greetings,

I had a client recently ask me, “What should I be concerned with in my home inspection report?”  Well, I took a second to think, as this is not as simple as an answer as it sounds. You see, different people will be concerned with different items.   After careful thought, I responded with a question in turn.  “What is important to you?”  “We just want to make sure the house is safe, and we aren’t getting ripped off.”  And that was the answer to their question.  They should be concerned with issue’s that might concern their health and safety (could range from structural, electrical, or air/water quality), as well as any major  issues (defects like remaining life span of the roof,  improper insulation, or furnace dependability) that could present major financial impositions within a short time period after taking possession.    After the report, we sat together and discussed each of the issue’s the inspector found, and they came to the conclusions on their own on which issue’s where important to them and should be remedied.  We have to remember, that while an inspection is for self educating purposes about your potential purchase, it may also be used as a tool to come to a mutual agreement to fix problems the seller may not have known about.  So, here’s a list for buyers, sellers, and others who may want to know what could be going on in their houses.  The top ten issues with homes that I’ve come across as a REALTOR®.
1.      The Handy Man Special. “Oh, my husband is a great handyman”. We’ve all heard the phrase, “Jack of all trades, Master of none.”  Unfortunately, he probably shouldn’t have been adding more outlets to the kitchen, or finishing of the porch into a three seasons room.  Homeowner improvements are a common thing inspectors notice for two reasons, it was probably done wrong, and there was no permit pulled to do it.
2.      Electrical Issues. Building codes are continually changing, and it requires diligence to keep up with them.  Certain issues with wiring, like hidden junction boxes, obsolete wiring like knob and tube, and not having an electrical panel, or sub panel, updated from fuses to circuit breakers are just some of the most common issues.
© Cabezonication | Stock Free Images 
3.      Roof Issues.  This unfortunately, can lead to a major expense in the near future if not detected by the inspector.  Certain things such as shingle conditions, loss of shingle adhesion, and improper flashing can cause havoc on the interior of the home, not to mention the cost to replace the faulty items themselves.
4.      Heating System.  Here in Maine, the furnace is a big deal.  While high efficiency is a plus, more importantly is how much life the system has left in it.  There’s not an inspector in the world that will tell you the furnace will be ok tomorrow, let alone another 5 years from now, but there are good indicators an inspector can use that can raise a cause for alarm.  If undetected, a replacement furnace could cost a lot of money.
5.      Perimeter Drainage and Grading.  There are many factors that can affect whether or not you will have a dry basement. One of those being if there is a drainage system around the house.  A good drainage system will weep water away from the foundation. Also are if there are gutters and downspouts from the roof it will aid in keeping water away. Finally, the grade of the land around the foundation plays a huge role in whether or not you’ll be going through numerous sub-pumps through your residence.
6.      Improper Venting.  Improper venting of dryers, furnaces, range hoods, and bathroom exhaust fixtures account for many things that inspectors find.  Improperly venting a bathroom to the attic, instead of out to the exterior, can cause an excess of moisture building up in the attic, which could cause other problems down the road.
7.      Hidden Water Damage.  A common culprit, for example, is the under the door sill at the front door.  For years, water has been hitting that spot, and the threshold has seen its better days.  But what happens when you remove that threshold to find that the water damage extends to the floor joists, and possible the sill plate.  While it is impossible to uncover hidden problems, a good inspector will do all that he can to find problems when indicators show there could be one.

© Sumos | Stock Free Images
8.      Air/Water Quality.  Some other hold ups, and possible deal breakers lately, have been when water and air quality come back undesirable.  Usually water quality issues are isolated to properties without municipal sources, but any property can fall prey to bad air quality.  Most common, radon, can be found in any home, and at the suggestion of the EPA, should be treated at levels higher than 4 pCi/l.
9.      Structural Issues.  These issues can range from minor/improper framing issues due to age or lack of knowledge, to major settlement issues such as foundation cracks or failing structures.   Improper renovations/additions without concern for how it could affect original structure is a common culprit in inspections.  “See how big we made this bedroom by knocking out this wall.”  “Yea, it looks fantastic, but why is the ceiling cracking?”
10.  Septic Issues.  Let’s face it, when we flush it, we want to forget about it.  But failing septic systems seem to be occurring more frequently lately.  Some can be attributed to improper installation, but mostly it’s due to homeowner neglect.  A simple inspection can tell you worlds about how the last family treated their system.  Let consider the alternative, you don’t want your kids to be playing in the mud, especially if it hasn’t rained in a week.

Monday, December 10, 2012

Always Consider Resale Value When You Renovate


Greetings,

Chances are in this market, if you're putting $30,000 into your home, you're not increasing its value by $30,000.  (Unless you're hiding the stacks of cash under the floor boards.)  The truth is, people value different upgrades and different renovations differently.  Are there too many differents in that last sentence?  But, there is a difference between renovating your home to get the most value out of it, and renovating it to fit your own custom needs.  Let's keep in mind here that I have seen a master bedroom with a full bathroom in it.  As in, there was no wall or door separating the two.  You could literally walk out of the shower straight to bed!

© Tomloel | Stock Free Images 
 Last week I was visiting a broker open house with a couple homes scheduled to be viewed.  One of the homes was a very lovely ranch, in a nice area of the town.  The house was receiving nice compliments, plenty of showings, but no one is stepping up to the table to buy it.  So why isn't it selling?  Unfortunately for these homeowners, they had fallen victim to a classic realty misfortune....  They had overly custom renovated to their liking.

As a REALTOR®, and in general, as a life philosophy, I try to stay away from using the absolute terms such as "always" or "never".  As in, “We’ll NEVER move, this will ALWAYS be our home”.  The fact is for some, this may be true, but for the greater majority, nothing could be further from the truth.  Life has a funny way of making plans for us.  So that job you think you'll retire from, or that perfect house you'll never outgrow, may indeed be just a rest stop along the journey of life.  So when renovating, always consider resale options.

To an extent, people love custom touches.  It not only shows pride in ownership, but also the consideration and planning to elevate the quality of living in your home.  There are indeed some exceptions to every rule.  You will have to expect that some attributes and changes to your home may not be well received to the next occupants.  That's why I've generated some renovation guidelines that I hope may be helpful should a renovation be in your near future.
  1. Depending on the scope of the renovation, consider hiring a designer/architect.  They can give you insights on what the latest trends are, but also show you timeless and classic designs that never go out of style and are sure to please you and future occupants for years to come.
  2. Remember, while you are keeping resale value in mind, you have to consider that you are indeed doing this for yourselves.  If you can't live with it, what's the point?  
  3. And that leads me to this point, that you are indeed doing this for yourselves.  Regardless of how nice the renovation, or how much money you've put into the upgrades, it's virtually impossible (in this market) to recoup 100% of money spent in your renovation.  Just because you like your one of a kind, custom garage with built in shelving and custom peg board storage, doesn't mean it will be well received by future occupants.
  4. Before you hire anyone, check references and ask to see the work that they have done.  One can NEVER be too careful who they let into their homes. (I guess there are exceptions to using the word never)
  5. And lastly, the more custom a home, the narrower the buyer pool for that home.  Unfortunately, when selling your home, you want to cater to the masses.  You want as many people to be interested in your home as possible.  Over customizing your home, to the point that only a few may like it, definitely hinders the marketability of your home.  
© Orla | Stock Free Images
Now, I'm not saying you shouldn't do whatever you like to your home. You are, of course, the Master of your domain, the Queen of the Castle, or the King of the County.  If you want a giant waterfall in your living room, go for it!  But, should you find yourself not living in that home for the rest of your lives, be prepared to have certain custom touches hurt the resale value of that home, and could even possibly have buyers taking the cost to remove such items, and subtracting it from your listing price.  Remember when I said people love custom touches in their homes, well, that's true.  Theirs! They want their own custom touches, which may not be along the same lines as what's already there.  So with all that in mind, happy renovating, and remember, a hammer can be dangerous in more ways than one!

Best Regards,
MV



Friday, December 7, 2012

Have yourself a Merry Griswold Christmas!!

Hello,

I was watching TV the other night, and one my all time favorite classic Christmas movies came on.  National Lampoon's Christmas Vacation.  There are a lot of memorable scene's in this movie, but one of my favorites is the ordeal Chevy Chase goes through to decorate his house.  Does he go overboard? Yes.  Would you expect anything else from Clark W. Griswold? No.

Which brings me to my holiday housing point..  Don't pull a Clark Griswold this year.  You can take that several different ways by either remembering not to fall off your roof into the bushes, or by not setting up the ladder the wrong way and come sliding down on it.  Remember not to staple your sleeve to your house, and definitely don't staple your lights to your roof.  Here's the Clark W. Griswold things to avoid list:

  1. If you've received an invitation to the power company's Christmas party, you're probably overdoing it.
  2. If Walmart has an isle reserved specially for you, you're probably over decorating.
  3. If you've visited the hospital a couple of times, you're doing it wrong.
  4. When your walking in your attic, you're suppose to walk on the joists (wood beams), not the spaces in between.
  5. And finally, if you find yourself hanging off of your gutters, not only are you doing it wrong, your probably going to be revisiting number 3 on this list.
Please remember, whether it's your first X-mas in your brand new home, or it's your 30th X-mas, please decorate responsibly, or your house could look like this.

 
Warmest Wishes,
MV

Tuesday, December 4, 2012

Making a Move on Distressed Properties

Greetings,

Like most other full time real estate brokers, I've walked through my share of distressed foreclosures and shortsales.  In these properties, you can encounter anything from drifters, to critters, and even hazardous conditions.  A distressed property can be a very lucrative investment, if the stars align.

First, more than likely, you will need plenty of cash in the bank.  While there are rehab and distressed property loans out there, there are limitations to these types of loans, and they may not be applicable to certain distressed properties.  Second, you'll need to get this property at the right price!!  While that may seem like a no brainer, there are many variables and factors to consider to determine what the right price may be to you.

For example, is the property a flip, or will it be used for a primary residence.  Will it be an investment property, is it a multi-unit?  What are the fair market rents?  What would/could be my net operating income?  If it is a flip, what are construction costs? What are the market conditions (both at time of purchase, and projected completion of project)?  What would be the project profit from the sale after all debts and construction balances are paid?  Are there tax ramifications?  If I'm in a multiple offer situation, what's my top dollar?  These are just some of the questions you should be asking yourself prior to even stepping foot in a distressed property.   Remember, the price has to make sense.  In most cases, the top dollar offer for an investment property flipper would be different than the top dollar offer of a owner occupied buyer. It's good business to stick to these numbers and to only deviate with good reason. 

I always get calls when the newest distressed property hits that market, why?  Because it's always perceived as a deal, at least until they walk through it.  There's a saying;  the bigger the risk, the bigger the reward.  What they don't tell you is, the bigger the risk, the bigger chance you have to fall flat on your face.  The best piece of advice I can give people is to get your financial house in order.  Know what your liquid assets are, and be prepared to move on a deal.  If you have equity in another building, and you'll be using that to purchase another property, it's better to have that in place sooner rather than later.  The better the deal, the lesser the time it will be on the market.

And finally, line yourself up with a broker you can consistently call should you see something that grabs your eye.  You should have a good relationship with your agent and be able to trust what he/she says.  He/she has to be able to level with you and tell you what you need to hear regarding market conditions and they should have good relationships within the real estate community.  Your ability to get into the property quick may be the one thing that lets you write up an offer before anyone else.

Good luck, and happy shopping.

Friday, November 30, 2012

Introduction (11/30/2012)

Greetings,

Welcome to the first of many blog post containing anything from Real Estate news and headlines, to local community news, as well as facts, tidbits, and personal accounts from my everyday life as a Realtor in the Saco/Biddeford area.  My tireless goal is to provide you with information, fact and opinion narratives, as well  as astute observations that, hopefully, you find helpful or at the very least amusing.

If you do not know me, I'll save you the time of reading info about me in this introduction, as you will more than likely see there is an "about me" link that should suffice.  I will tell you this; for the most part, the life of a Realtor can be that of an exciting one.  It's not a mistake that we Realtor's say this is a profession that requires many hats.  I mean, how many other people can say their day at work consisted of walking through a million dollar beach house, standing next to (or possible in) a failing leach field, walking through an abandoned, flea infested property, having a free lunch (at the expense of another agent trying to market their clients property), nail biting negotiations on must have properties, and sitting at a table seeing a person possibly purchasing the most expensive thing they'll ever own, all on the same day.

Surround all that, and much more, with a cast of characters (clients, customers, and colleagues) that'll make Saturday Night Live look boring usually leads to an interesting day almost every day!  While my intention is not to have this end up as a humor blog, you must forgive me if, as hard as I may try to refrain, insert my attempt at humor from time to time.  Because, let's be honest here, life isn't worth living if we can't laugh at the things, or people, that lend themselves to such things.

All the Best..

MV