Home Seller: Your “To Do” List Prior to a Home Inspection.

February 22, 2011

by christiborden

Home Inspection Approaches

So you finally have a contract on your home. Congratulations! Now, your buyer has ordered an independent inspection. Believe me, this is a good thing. When so many real estate transactions end in court due to disclosure items, inspections are a wonderful way for both parties to be aware of the condition of the property and hopefully resolve any such issues up front. You should applaud a buyer that thinks enough of his investment to hire an inspector. I am always worried about buyers who don’t. In fact, I would rather not represent a buyer that declines to inspect, even new construction.

Even though it is probably too late to make major repairs prior to the inspection, there are some things a seller can do to help the inspection go well for both parties and most of these items are simply the little nagging, honey-do type of things that we, as homeowners, tend to get used to and ignore.

  • Let there be light: Check all light bulbs and replace those not working. An inspector is not going to test the fixture itself but may call it as a deficiency and recommend that it be examined by a licensed electrician. Quite a costly repair for a blown bulb.
  • Water, water everywhere: Repair any leaking faucets, water fixtures, irrigation systems, etc. If you do not know how to do it, hire a plumber. If you are aware of rotten wood on the exterior of your home, this is usually flagged for repair.
  • Heating, Cooling and More: How long has it been since your systems have been serviced? How long has it been since you changed your filters and cleaned your vents? A well-maintained home will shine at an inspection, helping you and your buyer keep the transaction together.
  • Access to your home: Make sure there is access to your breaker box, the heater/air conditioner, water heater, etc. If your personal belongings block these important items, the inspector will not inspect it causing the buyer to either accept an incomplete inspection, having to pay an additional fee for a further inspection or he may just pull out of the deal completely.
  • Disclose, Disclose, Disclose: Please click here to read my past blog about your responsibility as a Seller to disclose. This is not something to take lightly or to ignore. If you know about it something that you, as a buyer, would want to know about a property, disclose. Even if you have made a repair, it is required to let them know the issue existed.

That should get you started on your way to having your property ready for the inspection. If you have questions about this or other items, contact your Realtor or your real estate attorney for advice regarding the inspection report and repairs. Also, in the State of Texas, you are required to disclose this and any other property inspection performed within the last four years and must note same on the Seller’s Disclosure Notice.

I hope this has helped you and wish you a safe and stress-free journey toward your closing.

Disclaimer: My name is Christi Borden. I am a licensed real estate agent in the State of Texas and a member of the National Association of REALTORS. As such, I adhere to a strict code of ethics and all laws with regard to equal housing, which is reflected in the content of this blog. My broker is Prudential GARY GREENE, REALTORS, 23922 Cinco Village Center, Suite 123, Katy TX 77494. My TX Real Estate License number is 0517398. All of the opinions in this blog are mine, unless otherwise noted.

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The Accidental Landlord

January 13, 2011

by christiborden

In today’s tumultuous lending environment, so many would-be buyers are being forced into leasing. And this has created an upset to the supply/demand balance … forcing unsuccessful would-be home sellers into making their homes available for lease due to the lack of ready, willing and able buyers. Thus, what I call The Accidental Landord is born!

In many instances, this is a wise maneuver because it allows the seller to maintain a stream of income to cover most if not all expenses (maybe even make a profit), while allowing the seller to sell at a future time when the market is more favorable.

That said, there are so many factors that you, as a future landlord, should take into consideration before making this move. First and foremost, in the State of Texas, you have a wonderful resource available from The Real Estate Center of Texas A&M. Click on the title to view the Landlords and Tenants Guide,  available in PDF format that you can download and read at your convenience. Be sure to grab a comfy chair because it is over 115 pages long and filled with pages and pages of legalese detailing your responsibilities and that of your tenant. I make sure all of my clients have access to this guidebook prior to the execution of a lease contract because it is so very important to understand the rules from the beginning.

Another thing to consider is whether it makes financial sense to lease. Ask your Realtor to run a market analysis of leases for properties similar to yours in the last year. This will give you an idea of where to price your lease. If you are in an area with few leases available or if you have something special to offer (pool, extra bedrooms, extra garage spaces, modern upgrades, close proximity to schools, shopping, transportation, etc.) then you may be safe to list above the average. On the other end of the spectrum, if you are in an area with an abundance of lease inventory and your property is very similar to the competition, you may need to consider pricing at or below market rates to attract a tenant. Another thing you need to consider is you are responsible for your mortgage payment, property taxes, landlord insurance and in most cases, any homeowner’s association or amenities fees. You may negotiate any costs for lawn or pool maintenance and repair items in the lease itself. Do the math! If your expenses add up to more than you think you can lease it for… you may be better off selling.

Big questions to ask yourself: should I allow pets or smoking? As a Realtor who may have to sell a lease home later or try to find another tenant years down the road, these are very tricky.

First, let’s chat about pets. We Texans love our pets and the majority of tenants seeking placement will have a pet or pets in tow. Realizing that pets can and do cause tremendous damage to properties, you may wish to decline to allow pets or to offer consideration on what we call a “case by case” basis. By declining pets outright, you limit the pool of tenants who will see and make applications to lease your property. By allowing case by case basis for pets, you get the pet owner traffic but can turn down any tenant with pets that you feel might be harmful to your property. If allowing a pet, you can ask for a sizeable pet deposit (either refundable or non-refundable) to help defray future repair costs to carpets, wood trim and landscaping – items usually damaged by pets.

Second, let’s chat about smoking. Now, I am not trying to start a dialog about the health issues or social issues behind smoking… I am only speaking from a property owner standpoint and I can tell you that the damage caused by repeated smoking indoors is extensive. Properties will retain the smoke odor (which permeates flooring, walls, all fabric surfaces, etc and also tends to discolor paint on cabinetry and trim) long after the smoker has left. In fact, many times these surfaces must be treated and/or replaced to eliminate the smoke odor – which could be very costly, indeed. This is a personal choice and smokers are not legally considered a “protected class” so you are perfectly in your right to only lease to non-smokers. That said, not everyone is truthful about this issue so some due diligence may be required.

And while we are on the subject of “Protected Classes”, you as a Landlord are required to know and comply with the Fair Housing Laws. Click here to view these requirements as they apply to everyone, not  just Realtors. And remember, ignorance is no defense where fair housing laws are concerned. One look at the penalties and you will certainly want to comply.

One last thought: I have been told by more than one successful real estate investor that a smart landlord is one with an outside property manager. It keeps everything on a non-personal, professional level and helps make sure your tenant is well cared for while living in your property. A happy tenant makes for a happy landlord.

So if you find yourself in the shoes of The Accidental Landlord, a little homework and due diligence will help keep your shoes on the right path.


Seller’s Disclosure: What does a seller have to disclose to a buyer?

August 1, 2009

in a word: EVERYTHING… 

In the bad old days, the seller did not have this requirement placed on him and it was a case of Caveat emptor – “Let the buyer beware!”. Times have changed and the onus is now entirely on the seller to make known any and all material facts regarding the condition of the property he or she is selling.

In real estate transactions, the root cause for most problems is lack of disclosure by the seller. Funny thing is… most of the time it is entirely unintentional. Why would anyone in their right mind try to hide an issue that will come out anyway through inspections, diligent research or nosy neighbors happy to share any and all facts known or rumored about your home. Yes, your nosy Nellie next door did happen to see the foundation repairman and the roofer two years and will certainly make sure your buyer knows all about it – in great detail.

One interesting disclosure item that always causes issues is disclosing a prior death on the property. Now, deaths by natural causes, suicide, etc. are not required to be disclosed but those caused by a defect of the property or criminal activity – yes, DISCLOSE, DISCLOSE, DISCLOSE! Should you let the buyer know about a death that is not necessarily required? That is a judgement call you will have to make. Example: my brother-in-law bought a home in Austin a few years ago. When we visited, being the chatty gal that I am, I stopped by the neighbor’s house to introduce myself and learn more about the area. I found out in less than one minute that the prior owner had committed suicide in the backyard. Now, that is not a required disclosure item but… should it have been shared? Probably. Would it have caused a termination in the contract… Probably not. My feeling about the matter is: Would you want to learn about something of this nature from the seller or later from the neighbors? 

When I work with sellers, I deliver to them the Seller’s Disclosure form, a 5 page document that is required by the State of Texas to be filled out to the best of the seller’s ability and given to the buyer of any property within a mandated time frame according to the actual contract. There are individuals who are exempt from the use this form: Banks or other entities who own foreclosure properties, Probate administrators, etc. but the normal seller in the State of Texas must render this form… and that is where he/she gets in trouble.

I am often asked by my sellers…”Should I disclose this or that…?” As your Realtor, I am not allowed to assist in the completion of this form but my answer to that is always the same… a resounding YES! If the question was brought up in the seller’s mind, then YES, disclose whatever it is. The litmus test is you should disclose any and all items that if not disclosed, could cause the buyer to reconsider his offer. Meaning, if the non-disclosure of an item would cause your buyer to either make a different offer or pass on the property, then yes, DISCLOSE, DISCLOSE, DISCLOSE. Even if it was a roof repair 20 years ago…Again, I repeat… IF IN DOUBT, DISCLOSE. 

You can always explain your answer. I have had clients add several pages of explanation to the disclosure form, which is entirely appropriate. The disclosed item may have no affect at all on a buyer’s interest in a property. In fact, most homes (like people) have a past and as long as the issues are not on-going or improperly addressed, your buyer will proceed as usual. But by making your disclosure, your buyer simply will not have a reason to come back to you later if any and all matters are disclosed up front.

Another important item to disclose is any inspection report on the home within the last 4 years: structural, mechanical, environmental, termite, etc. And if you had a major issue that needed remediation (mold, for example), that really should always be disclosed even if completely re-mediated. You can again attach your explanations of repairs made and receipts for those repairs.

Disclosure items are a mine field of trouble if handled incorrectly so the best road to take is always the high road. Remember, you will be a buyer someday, too and will want your future seller to treat you as you should treat today’s buyer for your home.


Prudential Real Estate – Highest for Seller Satisfactionby JD Power and Associates! How can I serve you?

September 10, 2008
 

 (Houston, Tx) – Prudential Real Estate Affiliates, Inc., a Prudential Financial, Inc. [NYSE: PRU] company, and Prudential Gary Greene, Realtors® announced that Prudential Real Estate ranks “Highest Satisfaction for Home Sellers Among National Full Service Real Estate Firms” in J.D. Power and Associates’ 2008 Home Buyer/Seller StudySM.

The inaugural study measures customer satisfaction of home buyers and sellers with major national real estate companies. Overall satisfaction is determined by examining four factors for the home selling experience: agent (43%); marketing (38%); office (12%); and services (7%).

Among home sellers, Prudential Real Estate achieved a score of 793 on a 1,000-point scale – and Prudential Real Estate received particularly high ratings from customers in the marketing and office factors.

 

“We are very proud of this distinction, as it underscores the quality of our affiliates and their hard-working sales professionals, said Laurie Keenan, president of Prudential Real Estate Affiliates, Inc. “Our sales professionals are local experts, and sellers appreciate their ability to market and price homes right — along with providing exceptional, attentive service.”

The team at Prudential Gary Greene, Realtors® works hard to not only meet, but exceed the expectations of its clients – sellers and buyers, explained Marilyn Eiland, Partner, Prudential Gary Greene, Realtors®. “In the current challenging market, our clients want all the expertise and market knowledge we can offer – and by leveraging Prudential’s brand strength, its wide array of product and service offerings and its strong Internet marketing programs, we can provide sellers with the increased exposure they need.”

 

The J.D. Power and Associates study finds that despite the popularity of home buying and selling resources on the Internet, the real estate sales professional remains key to customer satisfaction with real estate companies. A large proportion of both home buyers and sellers rely on the Internet to facilitate the buying or selling process, with 68 percent of buyers saying that they used Internet tools to help them in the purchase process and 61 percent of sellers reporting that they used a website listing to market their home. In addition, among sellers, online methods are the most important aspect of marketing.

 

However, the sales professional carries the greatest importance among the factors that comprise overall satisfaction among both home buyers and sellers. According to J.D. Power and Associates, although the Internet provides home buyers and sellers with the ability to perform some essential tasks – such as listing a home for sale or researching a neighborhood in which to purchase a home – it still does not replace the importance of a good sales professional. Particularly in an uncertain real estate market, professional advice from sales professionals can be especially valuable to buyers and sellers. The knowledge and expertise provided by experienced sales professionals is an important benefit of using a full-service real estate company.

 

The study also finds that the average time a respondent’s home remained on the market was slightly more than six months, although home sellers represented by the top-ranking real estate companies report that their homes were on the market for slightly less time – approximately five and a half months, on average.

 

Satisfaction averages 794 among those customers whose homes sold within five months or less, but declines considerably to an average of 730 among customers whose homes took seven months or longer to sell, the study showed. A real estate company that provides sales professionals who are skilled at determining the appropriate market value and listing price for homes, and who can effectively market properties, can help minimize the time that clients’ homes remain on the market – which can save the seller money, inconvenience and anxiety.

Nearly one-half of respondents in the study (46%) reported using recommendations from family or friends to find their real estate sales professional. Approximately 28 percent used the Internet, 23 percent used a sales professional they had used previously and 11 percent used a printed real estate guide.

 

The study also reports that home buyers were shown an average of 13 homes before they made a purchase. Home sellers reported that, on average, their home was shown 11 times, and about five open houses were conducted before a sale occurred. The 2008 Home Buyer/Seller Study includes 3,670 evaluations from 3,205 respondents who bought or sold a home between April 2007 and June 2008.

 

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, training and customer satisfaction. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on cell phone ratings, car reviews and ratings, car insurance, health insurance and more, visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

 

Prudential Real Estate and Relocation Services, Inc. is Prudential’s integrated real estate brokerage franchise and relocation services business. Prudential Real Estate franchises are independently owned and operated. Companies are selected based upon outstanding performance records, high levels of customer service and shared business values with those of Prudential. Prudential Real Estate provides franchises with business strategies using Operation Reviews as well as numerous benefits, including access to Prudential Real Estate’s Online Seller AdvantageSM program designed to provide real-time information to sellers with the touch of a keystroke. Prudential Real Estate is one of the largest real estate brokerage franchise networks in North America, with nearly 2,100 franchise offices and approximately 64,000 sales professionals in the franchise Network as of June 30, 2008.

 

symbol is an icon of strength, stability, expertise and innovation that has stood the test of time. Prudential’s businesses offer a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. For more information, please visit contact Christi Borden at www.ChristiBorden.com or http://www.news.prudential.com/