Home Inspectors: A Love-Hate Relationship

It's like the old cliche..."you can't live with 'em, you can't shoot 'em." Home inspections are a pivotal part of the real estate transaction.  They are helpful, necessary and I highly recommend them.  But, all home inspectors are not created equal. The love-hate is that the inspection can be so important and educational for the buyer, which is how it's intended.  But, I have encountered some who come into the picture with some kind of weird imaginary chip on the shoulder, like his sole purpose is to scare the willies out of the buyer & have them run away in terror.

Many people don't realize, but home inspectors in SC are licensed and are subject to the Residential Builders Commission. They have a set of standards of practice that they are to follow.  This is a key point because, unfortunately, many inspectors don't follow these standards of practice.  In fact, I've had some tell me to my face that they know they are breaking the rules and they don't care.  For instance, a home inspector IS NOT supposed to walk on the roof of a house.  Why do you think this is?  Well, for one, he's not a licensed roofer.  If he falls off the roof and is injured, think the seller & his insurance company are going to be happy?  What if he falls and breaks his neck?  What if he damages the seller's roof while he's tromping around up there?  You see the point, I'm sure.

So, it's important to find a home inspector who knows the rules and is committed to following them, for his own and everyone else's safety.  It's equally important to use an inspector who knows his boundaries.  He's not a structural engineer, so he shouldn't make comments or judgments as if he were. The purpose of this inspection is to check the house overall for dangerous conditions, broken or non-functional components and anything that just doesn't work.  If there is a concern about how a breaker is wired, then the inspector recommends that it be followed up by a licensed electrician.  If there's an active leak under a bathroom, he'll defer to a licensed plumber.

What a home inspection is NOT is a time to seek out and focus on every imperfection that the house may have.  There is no perfect house, even if you have it custom built and you're on site everyday during construction.  They all have their blemishes. The home inspection's purpose is not to supply a cosmetic wish list for the seller to deal with. Cosmetic or minor issues are most often pointed out simply for the buyer's information. It's also not a time for a home inspector to convince the purchaser not to buy.  Nor is it a time for the buyer to talk himself out of the house.  It's intended to give the house an overall check up so that everyone knows what going on with that house.

Do we find things that need repair?  Sure we do.  Almost every time.  Do we panic?  Rarely, because most everything that an inspector finds is fixable. Do contractors who do this kind of work need weeks and weeks to complete it?  No.  They can rip out an entire bathroom floor, repair it, retile and be gone in a day. I think sometimes when we don't  know how to do something ourselves, we perceive that it must be super complicated and time-consuming.  But rest assured, to the people who do this kind of work everyday, it's a piece of cake.  Do we ever find serious problems like foundation movement?  Sure we do.  But guess what?  There are people who fix that stuff too. 

Once received, the agent (me) will review the inspection report with the buyer(s) and help determine which, if any, items need to be addressed by the seller.  Does the seller have to do what is requested? Nope.  He can tell the buyer to go jump in the lake (again, very rare).  What usually happens is that we negotiate, if needed, to come to an agreement on repairs and who is going to make them.  After all, the seller wants to sell and the buyer wants to buy. 

I believe in the importance of home inspections.  It can be the best money a buyer spends. But I am picky about the inspectors I recommend.  Ultimately, the choice is the buyer's, of course. We can provide a list of inspectors, however, that former clients have used with positive results.

Saluda Chase Open House

From time to time, we agents will host what we call an "Agent's Open House."  The idea is to get other agents into our listings so that they 1) are aware of the listing and 2) to get valuable feedback from our colleagues.  This feedback can help us and our sellers "see" issues with condition, price, asthetics, etc. that maybe we didn't see previously.

Since we agents are pretty much on the go all the time, we typically serve lunch so that agents can stop by, give us their opinions and grab a bite...after all, we've all gotta eat.

After making it through negotiations and inspections, the deal on one of my sweetest friend's house fell apart because of the buyer's inability to obtain financing like he thought.  This is the biggest bummer a seller, and an agent for that matter, can experience.  So, today, we hosted an agent's open house to get our fellow agents in the house and to see if any of them might have a potential buyer.  We had 14 agents stop by and one even brought a buyer client with her.  Having this many agents preview at one time was a huge success!

The house is fantastic.  It's a split floorplan, which provides awesome privacy for the master suite. The kitchen has been updated with gleaming granite counters, handsome cherry finish cabinetry and features a ceramic tile floor.  Other features include a bonus room, screened porch, fireplace, big backyard.  All of the agents who attended today had nothing but compliments for the house.  Take a look and if you, or someone you know might be a good fit for this house, please contact us to arrange a showing!

$188,000

 

Earnest money? Who's Ernest?

Sometimes we find that purchasers, when preparing to buy, focus heavily on putting aside money for their down payment that they forget about (or don't know about) other up-front monies that they will need.  The first one in the process is "earnest money."

When you write an offer with your agent (me) you'll also need to write a check called an earnest money deposit.  As its name implies, the purpose of this check is to demonstrate to the seller that your offer is "in earnest." You see, this deposit does a few things.  First, to show the seller that you are serious.  So serious, in fact, that you are willing to put that money on the line and forfeit it to the seller should you breach your contract.  Second, it also serves as a deposit on your side of the equation.  What I mean is that when we go to closing, this  money is credited back to you.  

One question people often ask is "if this doesn't go through, will I lose this money?" The answer most of the time is no.  All contracts are contingent on financing or proof of funds for cash deals. If something happens (you lose your job, for instance) that causes you to be denied financing, you will not lose this money.  However, if you are approved and just change your mind, this is default (breach) and you forfeit this money. Fortunately, in my career, this has only happened enough times for me to count on one hand.

Another common question is "how much earnest money do I have to put up?"  There is no solid answer here.  There are no rules.  You want to offer enough of a deposit to show your seriousness about the property and something that is in proportion to the value of the property.  For example, if you are interested in buying a $300,000 house, the seller is highly unlikely to accept a $500 earnest money deposit.  Why?  If you default, he only stands to recoup $500 after taking his house out of the active listing status while under contract with you. For that priced property, he will want a more sizable deposit to make it worth his while in the event of a breach.  Make sense?

The stewardship of your earnest money is strictly regulated by state government.  Your money must be deposited into a special trust account to be held there until it can be rightfully disbursed. Once your offer is accepted by the other party, agents are required by law to deposit your earnest money into that trust (escrow) account within 48 hours.  It's as safe as being in Gringotts (for all you Harry Potter fans!)

If you have any real estate questions, either of us would be happy to talk with you.  Information is power.

What is a home warranty & what does it do?

Sometimes I mention "home warranty" and people start nodding their heads and they say something like, "oh yes, insurance on my house."  Well, no. It's not a homeowner's insurance policy.  Homeowner's insurance is the big one; covers fire, trees crashing through your roof, someone getting injured on your property, your belongings, etc.  A home warranty is something quite different.

The home warranty is a one year policy that covers the working parts of a house.  Working parts are things like the heating & air system, water heater, dishwasher, swimming pool, electrical system, etc.  They were originally created to give homeowners some coverage for the big ticket items like heating & air but have evolved to cover much more.  Typically, the process goes like this:

• Your water heater malfunctions or quits working.
• You call the warranty company's toll-free number FIRST. Do not call a plumber, or any type of contractor without calling this number first.  You will void the warranty.
• The warranty company authorizes the proper contractor to come to your home.
• You pay that person a deductible, which can be anywhere from $50 to $100, depending on your plan.
• The contractor evaluates the problem and determines if it can be repaired or if it requires replacement.  They report this back to the warranty company who then approves the repair/replacement.

So, as you can see, this type of coverage can be quite valuable to a homeowner, especially someone who has not owned a home before.  As the end of that first year approaches, the warranty company will offer to extend the warranty for you.  You just pay the annual premium and you're all set.  Usually this is no more than $500, depending on the size and age of the house.  I can tell you from experience, if your heating & air dies on July 3rd in South Carolina, you'd much rather write a check for $500 than $2500!  Because when it's 100 degrees and 105% humidity, you're writing a check!

Saluda Chase Charmer

Love the location of Westover Acres but really prefer a  newer house?  Well, you're in luck! 1017 Riverstone Court is in Saluda Chase, a newer neighborhood tucked inside Westover Acres.  Same great location but modern floorplans, newer construction & energy standards as well as today's features.

Fantastic home ready for a new family

 This home sports a split, open floorplan which affords a private master suite with soaker tub and walk-in closet.  The other 2 bedrooms share a full hall bath. The kitchen has been upgraded with beautiful granite countertops, handsome cabinetry and built-ins.  Dine either in the breakfast area of kitchen or the formal dining area. Other features include bonus room, screened porch, fireplace, 2 car garage, cul-de-sac location. Priced at $188,000.  

Contact us right away to arrange a showing.  It's likely the spring market will gobble this one up! 
  

Condo Relief

The condo market can be one fickle little creature.  Some years, condos are hot. Everybody wants one.  Then, it goes cold and nobody will even look at them.  But, over the last few years, something else has been happening to the condo market. Something kind of scary.

Condo complexes or neighborhoods are subject to a lot of scrutiny when it comes to financing.  For someone to obtain an FHA mortgage on a condo, the complex must appear on the "HUD list" which is something the HOA has to apply for and maintain.  This has proven to be problematic in recent years because many HOAs either don't know they are supposed to be doing this, or they do know that their neighborhood no longer qualifies.  And since the majority of people are getting FHA financing these days, this presents a problem

But what about buyers using conventional loan products?  Well, we run into the same problem.  Even the conventional lenders want to follow the same guidelines. So, if the complex has too high a ratio of owner occupants to renters, no dice.  If the complex has too little money in their reserves, or if their insurance is less than $1M, sorry Charlie.  So, as you see, it was becoming an environment that if you owned a condo, you couldn't sell it because no one could buy it. And what happens then if someone can no longer afford their condo...foreclosures go up.  The situation was looking pretty dire.

Well, today I was talking to one of my lender friends. He and I had previously had this gloom and doom conversation about the condo situation.  He shared my concerns. Well, now, he's found a loan program that will allow a buyer, who intends to be an owner occupant, to purchase a condo regardless of the owner/renter ratio. This is huge, because that's usually the part of the equation that hangs everyone up.  This is really good news for condo owners and purchasers.  And, just in the nick of time. I'm meeting with a client tomorrow who I sold a condo several years ago.  He's ready to move on to something bigger, so this is really good news.

Anyone in the market for a cool condo near the Zoo?

Two signs the Spring Market is upon us!

  
As soon as these happy little faces start showing up in our gardens and our yards, we know spring is finally here.  With the warmer weather, blooming shrub & trees and fragrant blossoms comes that spring real estate fever. We'll begin seeing cars slowly cruising neighborhoods, increased visitors on our websites and more inquiries.  

Bring it!  We are ready for you buyers. Interest rates are still at historic and unbelievable lows. We have a healthy inventory with lots of great choices. Let the spring fever grip you and help you take advantage of these opportunities!