Buying a Home with Great Resale Value

RULES FOR RESALE 

1. LOCATION Whether you want to purchase a home to live in for several years or to resell quickly, the #1 Rule for ReSale is  location . Chances are that you may not live in the same home your entire life, so location and resale value may be important considerations when purchasing a home. The Palos Verdes Peninsula is one of the best cities for Resale Value, with an amazing award winning school district, low crime reports, family orientated neighborhoods, prime weather & views and an exceptional location most homes have no problem selling along the Peninsula.  

• Another important factor to consider as you try to find the best neighborhoods is the quality of the local school system. Even if you don't have children, you should try to research the closest schools before purchasing a home. This provides a good criterion to factor in of the attitude of the neighborhood and the type of people you’ll be surrounded by. High scores can mean parents are fully invested in their local school system and their children and this translates into how they feel about their homes.
• Though you may be looking for properties that lie in the middle of desirable neighborhoods, you should also consider how convenient the location is for a potential homeowner. The best homes will be located near all the essential businesses and have “walkability” - such as grocery stores, dry cleaners and banks.

2. NEIGHBORHOOD. Although this falls under Location, neighborhood plays a huge role in  Resale, and that's why it deserves its own rule. The most important step in finding a home with resale value is choosing the right neighborhood. One of the first things you may want to consider when researching a neighborhood is the economic stability of the neighborhood.

A desirable area will:

• Possess a good mixture of residential and commercial districts
• Have jobs for future residents
• Demonstrate consistent economic growth
• Be supported by a strong local government

In short, the ideal neighborhood will represent the best of worlds, offering residents both privacy and convenience.

3. MORE THAN 2 BEDROOMS

If almost every home in your neighborhood has only 2 bedrooms, owning a home with fewer than 3 bedrooms is most likely not a drawback. But it is a drawback if you're trying to attract, say, a couple. Many couples need a guest bedroom and an office, if not an office for each occupant. A home with 3 bedrooms or more is always a better choice to ensure future resale value.

4. MORE THAN ONE BATHROOM

Buyers will still buy a one-bath home but they expect to pay much less for it. Given a choice between a two-bath home versus a one-bath home, first-time home buyerswill almost always opt for the two-bath home, even if the cost to install a second bath is much less than the price difference between the two homes.

Moreover, it's not enough to simply have two or more baths. A home without a master bath will suffer a lower resale value.

5. FAMILY SPACE

The term family is a bit misleading. A family space is any space in which a group of people can congregate. Whether to entertain friends or host a neighborhood gathering, buyers want an extra room that is spacious and informal. The days of the formal living room and parlors are over. Every space in a home today has a specific purpose and sometimes a dual purpose.

6. STORAGE SPACE & CLOSETS

Don't ask me why, because it goes against my grain, but people in the 21st Century collect too much stuff. They've got to store it somewhere. Walk-in closets are almost an essential. Homes with small closets are hard to sell.

7. ONE LEVEL

When I was a kid in the 1950s, homes with 2-stories were more desirable but that trend has reversed itself. Even if the sacrifice is yard space, most buyers prefer a one-story home. Single levels are handicap accessible. However, in neighborhoods with a mix of two-story and one-story homes, don't buy a single-level home surrounded by multiple-story homes as those have a bad home resale value.

8. GARAGE

Unless you live in an urban area that relies mostly on public transportation, you need a place to park your car, preferably 2 parking spots. If it's a covered, enclosed area, all the better.

9. GOOD FLOW, LAYOUT

Few buyers want a chopped-up, closed-in space. Home buyers prefer natural light and open spaces, with a common sense flow that is interconnected without satellite rooms. A wing is acceptable; however, many families with young children do not want the master suite separated from the other bedrooms.

10 .UPDATES REMODELED 

Simple, do-it-yourself home improvements can greatly enhance a home's resale value. The two best rooms to remodel are the kitchen and baths. Home buyers prefer central heat and air, and some loans such as the energy efficient mortgage will provide for such updates upon purchase.

This Month In Real Estate: September

When is Disclosure too Little, too Much or Just Right?

Real estate agents walk a fine line regarding disclosure in meeting their fiduciary responsibility to their clients. The question is when is disclosure too little, too much or just right? The truth is that there are no absolute answers, just common sense practices that an agent can follow to best serve their client and protect themselves.

We recently took a look at the C.L.U.E. report which has been available for approximately the last 8 or 9 years. Re-Insider finds this report to be a great example of the variety of information that can find its way into today’s real estate transactions.

The first question that should always be looked at when vetting disclosure information is, is there a legal requirement in the California Civil Code for a particular disclosure of information? If there is, for example the NHDS or TDS in most residential transfers, then it has to be in the disclosure information to the buyer.

But what about non legally required reports, C.L.U.E. being a good example? In the case of C.L.U.E. reports being provided, this grew simply from CAR adding a question to their SSD form which was then incorporated into the SPQ on page one. This is a form that has grown over the years to 10 questions in which a seller is advised, by CAR, to disclose to a prospective buyer of their residential property. The question on the CAR SPQ regarding insurance claims is simply “Insurance claims affecting the property in the last five years”— answer to be given as simply yes or no.

So how did the additional information contained in a C.L.U.E. report, not requested or required, come into use and does it potentially pose a liability to the agent? The quick answer to the first question for coming into use is money. What was once a simple yes or no answer from the seller is now a $19 + report that companies make money selling into the transaction.

As far as the question of liability to the agent, if the additional information in the C.L.U.E. report has a mistake in it, as happens from time to time and causes some of the problems discussed in the previous article, then who takes responsibility? The most common response from agents is the company that sold the report to me of course. But as it turns out this is not necessarily the case.

Why you ask? The C.L.U.E. report comes with no guarantee or indemnification from LexisNexus, the company that produces the report. The resellers, usually disclosure companies, all have a third party exclusion in their limits of liability that state they are not responsible for mistakes in information provided to them from outside sources.

This can leave the real estate agent or brokerage financially responsible for the C.L.U.E. report if there is a problem. The message in this for agents, using C.L.U.E. reports in this case, is to look at your disclosure procedures with an eye towards not only meeting your fiduciary duties to your clients, but managing your own risk. With that in mind, with the case of C.L.U.E. reports the best answer may be to use the CAR SSD form.

What do you think of this situation? Are you in favor of regulating disclosure companies?

 

RE Insider read more here:

http://re-insider.com/2014/07/23/when-is-disclosure-too-little-too-much-or-just-right/

How to Restore Your Credit Score Quickly

Buying a home is the American dream and you have decided that it is time to start looking into buying a home of your own. That's great! However, you probably know that there are things you should be doing before you begin your search - but where do you start? The first thing you need to get in order, before you do anything else, is to get a copy of your credit reports. That's plural - credit reports.

You need to get a copy of your credit reports from all three credit reporting agencies - Trans Union, Equifax and Experian. If you are thinking about buying a house, you may not realize the importance your credit reports hold in getting an approval for your new home.

 The mortgage companies are more concerned about your recent buying and repayment history than what may have happened years ago. If you have too many recent late payments or collections, there may not be anything you can do to get approved in the immediate future.

 However, there are some things you can do to clean up your report. So in six months to a year or maybe even two years, depending on how bad your credit is and how long it takes you to clean it up, you can apply for a home mortgage and get your approval.

 Here are a few things you can do to restore your credit and credit score quickly:

 1. Check your credit reports for errors. Again , that is plural so check all three of your credit reports for errors. If there are mistakes on your credit reports, you will need to start an investigation with the company or the source of the derogatory information. Contact them in writing and make sure you include all supporting documentation proving the information is in fact an error.

 2. Set up a timely repayment schedule. If you have any accounts that you have been late in paying, you will need to begin paying all of them on time. Paying your bills on time for a minimum of six months will go a long way in improving your credit rating.

 3. Collections. Try to avoid having your accounts turned in to collections. A collection is the most damaging of all credit issues. So work out a re-payment plan before your account turns into a collection. A credit improvement agency may be able to help you get your collections erased; but only if the creditor did not abide by all of the laws of the Fair Credit Reporting Act. However, this is generally not the case because most creditors know the laws and how to follow them. So don't count on this as a quick fix . Most collection accounts will stay on your credit report for a minimum of seven years.

 4. Keep a low balance on all of your revolving credit accounts. Try to keep your balances below 50% of your limit. The lesser the balance the better it looks to potential creditors.

5. Do some soul searching. Try to determine what caused your credit status to get out of control in the first place. Then do whatever you have to to amend your bad habits - if any.

 6. Get a secured credit card. Secured credit cards can be very helpful in improving your credit. There are many things you can do to get your credit report back on track quickly. So talk to your real estate agent for more information about how you should go about doing this.

 In the meantime, your Realtor will be able to get you started on your path to home ownership while you are working out your credit issues. Your agent has the experience and the know how to help you get into your new home as quickly as possible. So take advantage of all they have to offer you.

6 Common Mistakes Homebuyers Still Make

Getting a new home is easy but tricky at times. Many buyers are encountering stumbling blocks en route to their chosen house. This is because they commit minor mistakes along the way that hinders smooth processing. This can be prevented only if you are familiar with these common mistakes.

1. Having no pre-arrangements with the bank for mortgages before making an offer is the most popular mistake. Communicate with a bank to know the price range you are capable of paying and other mortgage details that you need to know.

2. Knowing your exact budget is critical. Most people look around for houses even without the budget in mind. First thing you need to know before finding a home to purchase is how much you can pay for a new home. You can save much time if you trim down your list of houses based on its price; imagine finding that dream home only to find out you won’t be approved for the mortgage?

3. Getting unreliable and inexperienced real estate agents is a big no-no. Choose an agent that has the background to back him or her up. Also, consider the real estate companies you are dealing with. Make sure that they have a good standing in terms of the services they are providing.

4. Most people are shopping around within a limited market. You can find homes for sale anywhere such as internet, print ads, and even on TV. You may also want to ask for help from your agent to provide you a list of preferred houses. You can save time if you know what kind of house you are looking for.

5. Purchasing a home long distance without thorough inspection is a mortal mistake. After choosing a home, it is a must to visit it personally so that you can see it in a closer view. Some pictures only show the good angles of the house. It can be very deceiving at times. Check the structure and foundation to ensure safety. Also, look around the neighborhood and get comfortable with it.

6. Buyers tend not to compute the total cost of the house. Other expenses such as home insurance, association dues and even lawyer's fee for proper documentation of the purchase should be considered. We are not talking about coins here. These range from hundreds of dollars to even thousands. You need to prepare your pocket for it.

Buyers are usually not aware of all the details. It is your home and you are responsible for it. You need to know and understand everything about it, from home warranty to insurances and even the history of the house.