Buying Process

Ok, so we all agree that the end is in sight if not passed.  The economic climate is improving and home prices are bouncing around the bottom.  Winter is traditionally a great time to buy a home in Seattle with less competition and generally lower activity.

 Right now is a unique opportunity for some, but not for all. 

So who should be buying a home right now?

Here is the unique situation we are currently in:

• Homes overall in Seattle have come down 22% since the highs of 2007
• Interest rates while not at their lowest are still WELL below there 20 year average and near record lows
• First time home buyers as well as Repeat buyers who have owned for more then 5 years are in line for an unprecedented tax credit of $8,000 and $6,500 respectively.

So who should be buying in this environment and who shouldn’t?

As a general rule, anyone upgrading is in great shape. 

If you are currently renting or are in a smaller home and plan on buying something

more expensive, now is the time to pounce!

Why?  If you are a first time home owner you are not likely to see a better scenario.  If you are upgrading, you will see less profit from your current home. but the discount you are getting on the larger home, more then offsets the loss you will take on your current home.  This is even further exaggerated when you consider the tax credit and low interest rates.

If however you are downsizing or considering a move to a smaller home, now may be the worst time to make a jump.  If you can avoid it consider staying put or renting out your current home to avoid taking a loss until prices rebound.  Be advised however that if you are expecting a quick jump similar to what we have seen in the stock market, you will be disappointed.  Home prices should not get back to their 2007 prices for years to come. 

Plan accordingly, good luck, and give me a call if you need anything.  Happy New Year!

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Rob Graham, Windermere Real Estate

Your Home Buying Expert

206-0321-6349

robgraham@windermere.com

Popularity: 7% [?]

I have been getting this question a lot lately, so I thought I would throw out a list of questions for you to rattle around in your brain if you are just getting started.

These are questions that are good to toss around at the dinner table with all the family members involved in the move. 

What Neighborhoods do you want to consider?

Things to consider: schools, commute, parks, proximity to shops, pet friendly, parking.  Seattle is a treasure trove of differing neighborhood personalities.  Some will be drawn to the quiet and sleepy and some will be drawn to the up all night neighborhoods.

What type of home?

Single Family, Townhouse, Condo, Co-op, House Boat.  Consider Condo’s Co-ops and house boats all tend to come with dues.  So do some town houses.

Busy Street?

Most are closer to shops and bus lines but they do tend to be nosier.

How much work are you willing to do to the home after you move in?

Does it need to be in pristine condition, or are you willing to swing a hammer?  Most homes that need a facelift are cheaper, but don’t overshoot your budget or time.

How much space do we need?

Is your family growing?  Is someone going off to college in the next few years?  Might mom need to move in in the next few years?  How often does family visit?

Design? 

This one is harder to know before you go and preview a bunch of homes.  One style will start to tug at your hears strings though and others will repel you.

What can you realistically afford?

Start with your current monthly cost for housing and realistically estimate what you can swing for your total monthly payment.  Take that number to the bank and find out what it translates to for a mortgage.

How long do you plan on being in the home?

The average length of stay in a home is 7 years.  Less for first time home buyers.  Don’t get into a serious fixer is you are moving in three years. 

It isn’t an exhaustive list, but a great place to start.  Begin to narrow down your focus then give me a call and I’ll set up a day where we can go out and take a look at some of the homes that match your ideas. 

Talk to you soon,

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Rob Graham, Accredited Buyers Representative

Windermere Real Estate

206-321-6349

robgraham@windermere.com

Popularity: 9% [?]

I received this question from a reader of this blog.  

I thought many of you might appreciate reading the response:

Dear XXXXX,

Currently the minimum down payment for an FHA loan is 3.5%

You will also have closing costs including your loan fees, escrow fees, title
fees, prepaid taxes and interest, and recording fees.

Also keep in mind that you will want to have an inspection done on the home and
I highly recommend a sewer scope if you are purchasing a home but not if you
are purchasing a condo.

Here is an estimate of what you can expect to pay for a $300,000 home.

Escrow Fee:  $500-$600
Title Fee: $700-$800
Recording Fees: $100-$150
Inspection: $400
Sewer Scope $200

The fees associated with your bank loan will be the most expensive part of the
closing costs.  It is difficult to estimate what they might be.  Banks vary.
1% of the loan amount is typical for an origination fee, but then there are
other fees associated that you would need to speak to you lender about.

Prepaid Tax and interest is dependent upon when in the month you sign.  You
typically don’t make a mortgage payment the first month after you move but the
interest and taxes still need to be paid at closing for the period before you
first payment.

I hope the info helps.  If you have more specific questions.  Let me know a
little more about your situation and I’ll be glad to see what I can do.

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Rob Graham, Accredited Buyers Representative

Windermere Real Estate

206-321-6349

robgraham@windermere.com

Popularity: 10% [?]

Here is a video I created a few months back.  The information is still as relevant as it was then. 

Let me know what you think of the video.  I am experimenting to see if I want to make it a regular.  Part of the blog.

As always if you need help, you know where to find me.

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Rob Graham, Accredited Buyers Representative

Windermere Real Estate

206-321-6349
robgraham@windermere.com

Popularity: 14% [?]

Earlier in the week I created a post about the top ten things to avoid when purchasing a home in Seattle. 

Top 10 Most Important Things to Avoid When Buying Your Seattle Home.

One of the items I listed was to not use the listing agent of the home you are trying to purchase to represent you in the transaction.  I am going to tick off a lot of other agents by telling you this, but tough.

In the standard listing agreement that the multiple listing service provides, there is the provision that the listing agent reserves the right to bring a buyer for the property and receive both the listing commission and buyer’s agent commission. 

It is a situation known as dual agency.  The agent is not truly representing either side and is now in the process of mediating a deal between both sides.  They get paid twice the commission in most cases, but both the seller and buyer receive slightly less service.

Think of it this way.  If the buyer and seller each have their own agent, each agent is required to represent the best interests of their client.  If on the other hand, an agent is representing both the buyer and seller there is no way to represent both sides interests.  In some cases the agent may in fact continue to only represent the best interests of the seller, leaving you to fend for yourself with terms and processes you are not familiar with.

Many agents in these difficult times are willing to perform the services of a dual agent and you can see why.  It is perfectly legal, but in my opinion not in your best interests.  Get your own agent.  It doesn’t cost you a dime and you will have someone representing your interests in the transaction.

I’d love to be your buyer’s agent.   Give me a call if you need help.

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Rob Graham, Accredited Buyer’s Representative

Windermere Real Estate

206-321-6349

robgraham@windermere.com

Popularity: 10% [?]