Carolina Living Real Estate

Recently, I have spoken to many buyers and sellers about the pros and cons of buying and/or selling a home in short sale.  Based on some recent deals (of lack thereof), it is becoming increasingly difficult to give positive recommendations to pursue this direction.

While closing on a transaction of this type can result in  a positive outcome, it can also be very frustrating for both buyer and seller.

Case #1

We recently (10 months ag0) listed for short sale an awesome home for a group of investors that the value had dropped so significantly due to market conditions.  After one of the major banks accept an offer within about 3 months, the buyer then could not qualify for a loan.  We then waited on the major bank to sell the loan and in the meantime secured a new offer.  After another 4 months, the bank accepted the offer only to have to wait for the PMI insurance company to then make a decision.    Upon finally getting everyone on board, this second buyer started to waiver until, magically, several things happen that preventing his continual pursuit of this home.   As a part of the banks acceptance, we had a very stringent timeline to get the deal done before foreclosure.

So here is the dilemma:

Do we continue to advise our seller clients that a short sale is a valid alternative?  The biggest challenge beyond just being patient deals with earnest monies and/or due diligence fees.  You see the theory is that due diligence fees are not paid for these type of transactions.   The question is ‘Why give the owner money when they are no longer making the mortgage  payment’.  Valid question.   However, there are people that have really tried to do the right thing and do not want a foreclosure on their credit.   Since the buyer has NO skin in the game they can just wait on the bank to make a decision and then just say ‘OOPS never-mind’.  Granted they may have some funds spent for inspections but the cost to the buyer  is far less than the cost to the owner.

Lastly and less important, these type of scenarios have driven Realtor’s out of the business.  Many man hours are spent on these transactions and when a buyer walks no one gets paid.

Case #2:

We listed a home for sale with a short sale in mind in Spring of 2010.  In the interim,  we have had six buyers come and go as they have gotten tired of waiting.   Now we are in late summer 2012 and we finally have a buyer that was patient and we have had mortgage company #1 (actually #2 since the loan was sold) finally accept the offer.   Low in behold, we have then had to wait for the second lien holder give us an approval.   When the approval came back, there was a $2500 difference in what the First was willing to give up and what the Second wanted.   So after over 2 years we are  $2500 apart.   Amazingly the buyer has agreed to pay the difference.   However, this could easily have fallen apart!

Why in the world has it taken over 2 years to get an answer.  Who knows?   No one knows and no one can predict.  So, what do we tell our clients.

At Carolina Living Real Estate, we are committed to helping our clients with these decisions.   As in any Real Estate transaction, disclosure is key.   We disclose the pros and cons of what may or may not happen.   However, giving advice either way is not something we have a growing confidence in doing.

 

If you are looking for ways to enhance the value of your home on a smallish budget, here are a few tips that will help finally get your home sold!

Paint the shutters, eaves, doors and other trims – if you can paint the whole house, great – but if you can’t afford all that, painting the trims and accents can make a massive visual difference in the look and feel of your home, very inexpensively;

add new hardware like a mailbox, house numbers, and a front door or door knockers

landscaping – planting lush or fragrant flowers or trees, trimming up overgrown shrubs and even installing low maintenance ground cover can also transform the entire look of your home from the curb.

You would be amazed at what a huge difference little things you do to the outside can make.

Improving Your Charlotte NC Area Home?

When it comes to doing a home improvement you have to look at it two ways. The first way is “How long do I plan on living in this home? How long am I going to use or enjoy the improvement I am potentially going to make to my home? What is the value of the improvement to you that you put into the house?” For instance if you’re going to put in a pool, are you going to get one seasonal year of use out of it or are you gong to be able to enjoy it for a long time?

The second thing is to ask, “How soon am I going to be selling my home? Am I going to get the value out of it when I sell the home?” So many people make the wrong improvements that end up costing them thousands and thousands of dollars. There are different improvements to make based on those two questions and the answers you give.

The bottom line is that improvements to the kitchen pay off every time. No “ifs”, “ands”, or “buts” about it. This is where life happens for most families. This is where you talk with your family, where you enjoy dinners together, where you help your kids with their homework, and where most people tend to gather with friends and family. You’ve got to really consider, are you going to get a lot of use and enjoyment out of remodeling your kitchen? The answer is, undoubtedly, yes. It’s also pretty affordable to do with today’s pre-fab units, etc. You can generally get a kitchen remodeled for between $2,000-$5,000. Remember most good memories are made in the kitchen. This means that even if you’re NOT staying in the house, the improvement will pay off when you sell it because kitchens are a huge selling point.

Fix any of those glaring repair issues. These are the little things that stare at you each day of your life; a cracked window, a wobbly doorknob, a shower door that won’t close unless you lift it a certain way. Buyers see these small things all together and will walk away saying “I’m not going to buy this home because that repair is going to cost me money.” The truth is, small repairs are inexpensive to fix; however, buyers over exaggerate the expensive of fixing these small repairs. Whether you stay in the house or sell it, these small, glaring fixes that you keep putting off will have to be done either way if you are selling or not. The smallest of repairs can make a huge difference, so fix that screen on the front door, patch that hole in the wall where the door knob hit & put a door stopper in to keep it from happening again. These small, “nickel and dime” repairs stand out to those viewing your home and they will overprice what it’s going to cost them to fix them. They think in terms of “this house isn’t exactly in move-in condition,” even if it truly is and the fixes are literally small projects that can take only a few minutes. In the end these small fixes can lead to a sale.

Next, you want to spruce up your home so it looks good at first glance. As we said before, little things make a big difference. Cosmetic things such as new carpeting, a fresh coat of paint, and putting fresh bark in the landscaping make a huge difference. Note; if you have any pets you will want to wait until 2-3 weeks before you put your home on the market to replace the carpet. There’s a saying that goes, “Big doors hang on little hinges.” You’re going to get a 90% return on investment with these types of investments. Spend $10 and get $100 back in value when you sell your home.

So why are we sharing these things with you? We want to make sure you get a good deal no matter who you work with as your Charlotte area realtor. We figure that if we get this information out into the marketplace then everybody wins! Don’t forget, selling homes is Carolina Living’s passion. We love selling homes and it’s the way we pay our bills. So if you’d like help on selling or buying a home feel free to give us a call or drop us an email.

Our goal is to make sure you get a good deal when buying or selling your home and you have great information to make those decisions off of.

As the old song states. “Video killed the radio”. At Carolina Living Real Estate we have added to that statement, and paper advertising etc. Carolina Living Real Estate is all about innovation to get your home sold!