How to deal with a less than stellar inspection report

When buying a home, hiring a certified home inspector (Illinois house inspectors are licensed through IDFPR) to give the place a once-over is a must. To the untrained eye, problems with the home's structure or systems such as an ineffective exhaust vent or bad electrical wiring can be virtually impossible to detect.

And while you might not be able to tell if the grade of the house is off, you'll sure notice when there are fish swimming around in your basement after the next big rainfall!

Home inspectors are often just a precautionary matter, since a seller should be aware of and disclose any serious defects ahead of time.

But what should you do when a bad home inspection report makes your dream home suddenly seem more like a nightmare?

Here are some tips on dealing with a bad home inspection report:

• Don't panic. Almost no home is perfect. Most will have issues that come up on home inspections - even new ones.
• Do your homework. Get as much information as you can from the inspector - especially if you were not able to accompany him during his walk-through (although we strongly encourage you to be present during the inspection).
• Go through the home inspection report with your REALTOR to decide which defects are minor and which ones are major.
• If there are major items that need to be addressed, you can ask the seller to: 
  • fix the items on your list,
  • fix only the most serious items, 
  • provide a cash credit at closing, or
  • reduce the sales price.
• While it might be tempting to hand over a to do list to the seller, sometimes you are better off making your own repairs.

Example:
"When I bought our house, the basement had a lot of cracks in it. I should have asked for a credit but instead asked the seller to repair it. I believe he literally walked around with a can of spackle and slapped it on every crack."

Gee, how helpful... Learn from my mistake.

For that very reason, many buyers ask the seller to provide a credit at closing to make repairs themselves. No one - buyer or seller - is happy to see a bad inspection report. But it's also not the end of the world.

Remember, everything is negotiable. Stay positive and don't let a bad inspection ruin your day - or your deal.

National Open House Weekend is Right Around the Corner!

Yes, you heard right...the National Association of REALTORS is sponsoring a National Open House Weekend June 4-5. If you have a home to sell this spring, there's still time to jump on the bandwagon and get your home "open house ready". And if you are a buyer, what a great time to really see a broad range of homes for sale in your community.Don't miss this fantastic opportunity on either side!

So, as a homeseller, how can you take advantage of this event? Here are some tips from the Illinois Association of REALTORS.

• Think curb appeal - Buyers will be seeing a lot of homes, make sure yours is the one that catches their eye. Trim your lawn and bushes, plant some flowers, put away the yard tools and toys
• Make minor repairs - Fix that squeaky door, repair broken knobs and hinges, replace burned-out light bulbs. A home that looks well-cared for is more attractive
• Clear out the clutter - Weed out the knickknacks, remove excess furniture, throw out the clutter or consider putting some things in storage
• Clean up - Look at your home through the buyer's eyes. You don't want the one thing they remember to be the dirt. Clean windows, floors and appliances
• Get rid of lingering pet odors. You may love Fido, but potential buyers, not so much
• Clean your carpets and if you have time, put on a new coat of paint to freshen things up
• Get the word out - Your REALTORS will place signs, but make sure your friends and neighbors know you'll be having an open house. It can be beneficial to have more homes shown in your neighborhood. More open houses = more traffic, benefiting you as well.

If you'd like more information on this upcoming event, please visit http://www.yourillinoishome.com/openhouseweekend.htm

 

Why Local Elections Matter

While elections for national and statewide office often capture our attention and stir our emotions, it's the races closer to home that actually have the biggest effect on us - and our wallets.

Municipal elections touch the value of our homes, our schools, the streets we drive on and the police and fire departments that protect us. Good local leaders can help communities flourish, while irresponsible public servants can drive them into fiscal insolvency.

Right now is not an easy time for our cities and villages. Like everyone else, they are still feeling the effects of the recession and looking for ways to make ends meet. To close their budget gaps, many are considering service cuts as well as tax hikes and other means of generating new revenue.

Unfortunately, that new revenue is often drained from the pockets of local homeowners in the form of property taxes and measures such as water bill deposits and building permit fees.

It's not fair - nor is it a good idea - to balance a budget on the backs of homeowners. Just ask your local REALTOR what effect that could have on your ability to sell your home in the future.

Due to the nature of our work, we closely align with the needs of homeowners. From fighting to protect mortgage interest deductions on the national level to thwarting onerous taxes and codes locally, REALTORS serve as homeowners' tireless advocates. We watch your back by monitoring local government activity for issues that might interfere with private property rights, or affect your ability to buy, sell or maintain your home.

We urge you to pay attention to local elections and vote on April 5th. Take some time to study the backgrounds of - and meet - candidates for city council, county board and school board, for example. Be sure and ask important questions such as:

• Do your candidates support property tax increases? If so, why?
• Do they support regulations that make it tougher to sell foreclosed homes?
• What is their position on transfer taxes?
• How do they feel about the regulation and requirement of home inspections?
• Are they considering any new property maintenance codes? If so, what are they?

Now more than ever, it's important to pay attention and make your voice heard - and your vote count. Let's work this spring to elect capable leaders who can help boost the value of our neighborhoods without placing an undue burden on homeowners and our communities.

Shopping for Your Home

  This video was just unveiled through the National Association of REALTORS and Housing and Urban Development on shopping for your home. Nicely done video that gives some good and credible information (which sometimes is difficult to find on the internet)! Some topics it addresses are: How much can you afford to spend on a home and how much of a mortgage can you afford? Check it out and let me know your thoughts!

 

   

"New Realism" and the American Dream

Alright already! We've heard enough about who's at fault in the housing market. While we may still be feeling the effects - hearing stories from family and friends - on how "tough it is out there," the truth in the matter is things are getting better, but not without some bumps and bruises and hard lessons learned. Those lessons may have just saved further complications for the new generation of home buyers and our sanity.

When I first began looking at buying a home, I was in my mid 20s, had just taken on a new fulltime job out of college and had more wild ambitions than those who attempt to climb Mt. Everest! Like many my age, I didn't care about the price (within reason); I just had to get into that house because that's what we were "supposed to do." Boy was I wrong. Then it happened. We all know the it I'm talking about. Thankfully, I had not been in a mortgage at that point but it did open my eyes to the entire process. A method, procedure and purchase that is so valuable that it requires careful consideration and a lot of planning - A LOT!

Michael J. Williams, the President and CEO of Fannie Mae, gave a speech in July at the Women in Housing and Finance Luncheon and spoke about what he called "new realism." Too long to get into but the short, the premise is folks, lenders and REALTORS have shifted in the approach to buying a home. You can feel it too I bet. This idea says "gosh, I should really consider the costs of this and make sure I'm right financially before I take on a huge financial responsibility." There's lesson number 1! Let's not leave out people who already own a home. According to Bankrate.com, 92% of people today know exactly what type of mortgage they have (e.g., fixed or A.R.M.) vs. 74% in 2008. The "new realism" suggests that people are more aware now than ever before of their finances, responsibilities and property!

The most important thing in a young person's life is to own a home - NOT how much money he or she makes. Think about that for a second...Ok, let me explain, strip yourself of all your material possessions and cash that you have now. You can keep your faith, family, that antique your grandma gave you and I guess, if you must, your mother-in-law. What is the one thing you hope you have left after losing all those material possessions and cash? I bet you said "a place to live," right? That could be either renting or owning; however, owning a home is the tie that binds all the stuff that you kept. There is a greater sense of "I made it" when we own homes. It's the one thing we hope we have good credit for (when applying for a home loan); at the end of the day, it's the one thing we went to work for (to provide for our family and make a home); and it's the one place we can totally be ourselves. This truly is the American Dream. If we consider what Mr. Williams suggested with "new realism," in conjunction with buying a home, just think how rewarding it will be when you do buy that home! Throw in all the old adages: good things come to those who wait, best things in life aren't free, and anything worth doing isn't easy...you get the picture. The picture that has you and your home in it! So start planning and, as always, consult a REALTOR!

 

 

So Why Should You Use a REALTOR Part 1

Of course I work for the REALTOR Association and always encourage the use of a REALTOR vs a sales agent or the dreaded "For Sale By Owner"....I'm communications and it's my job. However, that's not what this post is about. This post is about my experience as a consumer and why I personally chose to use a REALTOR when I became a first-time homebuyer and then when we chose to become move-up buyers a few years back as our family started growing.

 

Thinking back to when my husband and I decided that we wanted to become first-time homebuyers. I had not yet started working for the Association so I knew nothing about REALTORS, how to choose one, what to look for in an agent, etc. So...I went with someone I knew...my brother's girlfriends mom. Not exactly the most educated decision but she really did a good job. My husband and I had absolutely no clue about the process of purchasing a home...and the stress that comes along with it. Up until that time, it was the biggest purchase we had ever made. We hadn't even bought a car yet -- both our cars had been hand-me-downs from our parents. 

 

So our REALTOR took us out and we really had no idea what we wanted. The only thing we were clear on is that we were done with our apartment in Hoffman Estates. First weekend we went out we saw a few townhomes and realized we wanted something that had a basement and a garage. I also wanted a fireplace but that ended up getting nixed the following weekend when we found a great townhouse in Bartlett. Unfinished basement, two bedrooms and 2 1/2 baths. It really was perfect. We decided to write a contract on it. At the time, having an inspection was not part of the sales contract (it is now and when you purchase, you have 5 days to have an inspection or to sign off on not having one). I had no idea how important the inspection was. Buying a house is the biggest purchase you will ever make - don't do it blindly. Although I didn't really want to spend the extra money it was well worth it. The inspection uncovered some issues. Because we had the assistance of the REALTOR, she was able to negotiate credits at closing so we actually paid a little less for the townhouse than originally planned.

 

How did we find this inspector? The inspector was actually recommended by our agent. Shameless plug....A resource our Association has available to consumers is the Find an Affiliate section. If you ever need an inspector, banker, mortgage company, etc. please check it out http://www.succeedwithmore.com/about/for_consumers/aff_search.cfm.

 

Okay, keep in mind this purchase was back in 1998 when the market was busy. On top of the "busy-ness" of the bank, both my husband and I switched jobs smack dab in the middle of getting our mortgage. Take note -- not a good idea in the middle of the transaction. Two days before closing things still weren't right, we had to fax copies of our college diplomas to the bank...apparently a diploma signifies stability? Hmm, very interesting. Our REALTOR kept us in the loop during the entire transaction and really helped us as First-Time Homebuyers. I don't want to say we needed hand-holding but looking back on the transaction, we really did. She explained everything from the contract and approval process to what would happen all the way up to and including the closing.  The whole process was very exciting, very stressful and very rewarding in the end because we became the proud new owners of a Townhouse that we bought on our own and with our own money.

Illinois Housing Market Sees 8th Straight Month of Gains

The Illinois housing market has seen it's 8th straight month of positive indicators.  Closed sales were up 34.4% for April 2010 over April 2009.  The median prices across the state were up 5.9% over April 2009.  These positive indicators were the result of the rush to beat the first time buyers tax rebate deadline of April 30, 2010.   Almost record low mortgage interest rates, consumer confidence and some job stability were also contributing factors.

These factors improved the market not only statewide but in the local communities Mainstreet Organization of Realtors (MORe) serves.  MORe's April Trends for contracts pending were up 81.2% for Attached Housing. The leading communities were Woodridge 533%, Bensenville 600%, Glendale Heights 264%, and Hazel Crest at 500%. Single Family Detached Housing showed a 79.4% increase in contracts pending for April 2010 over April 2009. Communities with large increases were Blue Island 214%, Carol Stream 350%, Homer Lockport 235%, Kenwood 333%, and Leyden Township at 466%. The biggest gain by far was at Lake Holiday in the Sandwich/Somonauk area of LaSalle County at a whopping 1300%.

As we head into the summer months these trends should continue as the mortgage interest rates remain low at near record levels. The average sales prices have seen positive gains over the last several months with April 2010 showing a 3.6% increase over April 2009.  We should see a gain of 3-5% over the next several months.

All the indicators seem to be heading in the right direction so now is a good time to buy!

Free Home Buyers Fair April 24th

Ever wish you could get all the answers to your home-buying questions in one easy step?  Well on April 24th, you can!  The DuPage Homeownership Center is sponsoring our 18th Annual Free Home Buyers Fair on Saturday, April 24th from 10 am until 3 pm at the DuPage County Administration Building, 421 N. County Farm Road in Wheaton. 

There will be workshops on finding a mortgage, shopping for a home, home inspections, insurance and much more.  We'll also have a special session on the hot topic of buying short sales and foreclosures.  And there will be exhibits by lenders, real estate agents, insurance companies and other professional services.

Now is a great time to buy a home - there are still two weeks left to take advantage of the first-time home buyer tax credit, plus there are on-going local and state programs that are available now and will continue after the tax credit expires on April 30th.  We'll have information on all of these programs at the Fair.

For more information, call 630-260-2500 or visit www.dhoc.org.  You also can follow DHOC on Twitter at www.twitter.com/DHOC4Homes and on Facebook at www.companies.to/dupagehomeownershipcenter.

Is the Spring Market Coming Early???

Punxsutawney Phil, the Seer of all Seers and Prognosticator of all Prognosticators saw his shadow on February 2nd. He says there will be six more weeks of winter. Mainstreet's January housing reports say maybe the spring housing market is coming earlier.

The average sales price for single family detached homes jumped 4.5% for closed sales in January 2010. That is the first increase since December 2007 with most of the months since then being in the negative percentile. Now may be the best time to jump into the buying and selling marketplace. The first time buyer credit is available until April 30, 2010 and the closing must take place by June 30, 2010.

Many communities showed significant gains in average home sales prices. This could mean that the move-up buyer is utilizing the other tax credit which is available. If you have lived in your current home 60 consecutive months out of the last 96 months, you are eligible for a $6500 tax credit also.

Now is the time to get that home on the market. It looks like March and April could be exactly like October and November 2009 when many first buyers were jumping into the marketplace trying to get a contract on a home before the deadline expired.

Punxsutawney Phil says there may or may not be 6 more weeks of winter. One thing we do know for certain, you have only 10 more weeks to use the buyer tax credits.  Hopefully, whether you are buying or selling, the spring market will work for you.

Spring Housing Market Might Be Early!!!

Sales of single family detached homes jumped by about 10 percent in 2009. As a homeowner, if you are thinking of putting your home on the market, now just might be the right time.  There is more confidence in the market and the first time buyer credit is helping boost sales.

The impressive gains aren't in just one area. Southern Cook County, Western Cook County and Dupage County have all seen substantive increases in closed homes:

Bridgeview 49 percent increase over 2008
Summit 100 percent increase
Justice 65 percent increase
Bellwood 112 percent increase
Melrose Park 107 percent increase
Schiller Park 89 percent increase
Addison 75 percent increase
Bensenville 106 percent increase
Glendale Heights 71 percent increase over 2008

Townhomes and condos have seen improvement, also. December '09 showed a 28 percent increase in attached home sales plus an 89 percent increase in pending sales.

The first time buyer credit is working. The holidays are over and the weather appears to be improving. The April 30 deadline for the tax credit is looming. All factors could heat up the spring market earlier than anticipated.  As a seller, get your home ready and on the market in the next couple of weeks. Buyers, get your mortgage pre-approval from the lender you will be using.  Whichever you are, now is the time.