Home inspections are a key part of the buying and selling process in real estate transactions. Every market is unique in terms of the way buyers and sellers approach inspections and then subsequently negotiate inspection items. In our local market, it is customary for the buyer to schedule an inspection after an offer is accepted and a typical inspection period is 14-18 days. The buyer pays for a general inspection and depending on any additional inspections taking place like radon, septic, termite, etc… the cost can climb to well over $500. The inspection period covers the time for an inspection and by the end of that period, the buyers will have to make their formal response to the sellers unless they ask for additional time to have other professionals evaluate items that came up in the report. Another blog post will be dedicated to more about selecting an inspector, the inspection process, and how to sift through the response items to make the best response.

Top 10 Inspection Issues:
1. Drainage issues due to clogged gutters and downspouts. It’s Indiana and it can be really really wet here. Cleaning gutters and downspouts as well as adding gutter extensions can do a lot to keep water away from your foundation.
2. Water or moisture in the crawlspace. The addition of a sump pump or some perimeter drainage often does the trick. The key is to keep water from getting in and when it does get it out. It might be that this is a result of clogged gutters and/or downspouts so check those first.
3. Damaged trim around doors and windows. Again, another water issue…notice the theme here. This permits water intrusion and the trim should be replaced or repaired.
4. Missing GFCI receptacle. This is a common safety/shock hazard noted in inspections. Have a licensed electrician install the proper receptacle.
5. Windows with broken seals. Oh this one, ALL the time! This is what causes the foggy glass that you can’t get clear no matter how hard you scrub. The glass needs to be replaced and local glass companies can take care of this chore. Sometimes this fix takes a while with the glass company first measuring, then ordering, and then installing.
6. Light fixture doesn’t work. If you are a seller, make sure your light bulbs are not burned out. Also, leave out any fan/light controls. Often a non-working ceiling fan or light is because they didn’t have the remote to test it.
7. Damaged siding. Moisture can penetrate and cause additional deterioration behind the siding so it should be replaced with the best match.
8. Mold. I often find mold showing up on reports in the crawlspace or attic. There are companies that will test for mold and some clients want to have the home tested after any mold remediation is done by the sellers qualified contractor. For buyers with mold allergies, this is a top concern.
9. Foundation settlement/possible structural concerns. This is something that will strike fear into the hearts of buyers, especially first-time home buyers. If the inspector recommends a structural engineer take a look, then I put my buyers in touch with our local engineer to get his professional opinion. If there are structural issues, the engineer will draw up a plan to remedy them and typically buyers will have sellers at least provide a credit for this work. One thing to keep in mind is that when you start to mess with the foundation of a home, you will find that you might have additional repairs to drywall which will lead to re-painting.
10. Roof with missing shingles, nails popping up, and damaged shingles. It’s fairly easy to have a roofing company come assess a roof based on the inspectors concerns and create an estimate for any necessary repairs. If you think your roof has storm damage, give your insurance agent a call to have it assessed in case they determine a new roof or repairs are covered.

Many sellers are surprised when they see the inspection report on their home. If you want to try to avoid some surprises, think about having a pre-listing inspection. Happy buying and selling!

Bright white cabinets highlight this newly constructed room.

While we are still just entering the fourth quarter of 2019, the Sherwin Williams color of the year for 2020 has already been announced. Drum roll, please…the color of the year for 2020 is Naval SW 6244. Otherwise known as navy through my untrained eye. They promise it is a richer navy than we have ever seen before. I do think it’s time to introduce some darker colors into home interiors that are awash in white and gray. Pair Naval with all the gold tones present in current home finishes and it will fit right in.

What about other paint manufacturer’s colors of the year? Behr says their color of the year is Back to Nature S340-4. It’s very earthy, living up to it’s name, and is a green hue. Benjamin Moore will be announcing their color of the year at the end of this week.

If you are thinking about selling your home and need to paint before listing, maybe because tiny humans or pets also live in your home, what colors should you choose? It’s common for sellers to choose a neutral color assuming that is what will be most appealing or least offensive to potential buyers. While there is certainly truth in that, if you are painting solely to get rid of “color” then you might rethink your plan. Your home will photograph great with some color on the walls if, and I stress if, your furnishings look good in that space and really go well with the wall color. If you have primary colors in deep hues throughout, then yes you are due for a paint update. If you have sponge paint on your walls, then you will need to repaint or knock down the walls. I can only think of two possible options there.

So, if you have muted and/or maybe a few bright-ish colors that are tasteful then you might get by with a magic eraser to wipe away any scuffs. Ultimately, a new coat of paint does give a home a fresh look and removes some signs of having been lived in. If your home is looking well lived-in then your only choice might be to repaint. If there is one color I tell you never to choose, it’s bright white. There are a million white hues to choose from and bright, blinding white gets a big thumbs down.  My go-to white alternative is Creamy by Sherwin Williams. Happy painting!

Have you noticed that realtors use a lot of abbreviations and lingo that you aren’t familiar with? Here are a few terms and their meanings to help you get the gist of what we are talking about.

CMA: Comparative Market Analysis. This is a report that shows how a home you are considering compares with similar homes that have sold, are still on the market, or that have expired.

Closing Costs: There are several different “closing costs.” There is the cost to close at the title company, the appraisal, lender fees, title insurance, and other miscellaneous fees. In our market, the cost to close at the title company is typically split and the associated costs for a buyer’s loan are often paid by the buyer unless they ask the seller for assistance. Closing costs can range from

Comps: Comparable Sales. These are the sales, typically going back six months, which are most similar to the home you are considering and are used to create the CMA.

Contingency: An agreement is not fully binding until a specified condition is met. A home inspection and financing are two common contingencies. Sometimes a contingency could be a survey or maybe the buyer wants to confirm they can add a separate garage so the purchase is contingent on that approval. Too many contingencies can spook a seller, but there might be some out of the ordinary that are important to a buyer and make sense for their intended use.

Fixture: Something permanently affixed or attached to real property. For example, blinds or curtain rods are fixtures, but drapes might not be because they can be slid off the rod. Carpet, lighting, and bathroom mirrors are fixtures. It is important to know what is and isn’t included in a sale so there isn’t a dispute over what is personal property and what is a fixture.

FSBO: For Sale By Owner. Listings that will not appear in your local MLS and are advertised solely by the owner for sale without a contract with a realtor. A very large percentage of FSBO deals never make it to the closing table after accepting an offer.

HOA: Home Owners Association. Typically if there is an HOA it is a mandatory HOA meaning that there are dues required to be paid on a pre-determined schedule (monthly, quarterly, annually…) by each homeowner. Our purchase agreements provide a section asking the seller to provide any documents related to a mandatory HOA and giving the buyer time to review those documents plus ask questions.

Lockbox: This is how real estate agents or other members of the board of local realtors, like inspectors or appraisers, will access your home. Our lockboxes are controlled by an app on our phones that only board members have access to download. The lockboxes are secure, trust me, I’ve tried everything to break into one that ate a key and was stuck! I had to mail it back to the lockbox company for them to remove the key. 

LTV:  Loan To Value.  The amount of money you borrow divided by the price you pay for your home.  If your home is $100,000 and you put down $10,000 then your LTV is $90,000/$100,000 = 90%.  

MLS: Multiple Listing Service. It is a local organization that collects data and information about homes listed for sale by its members. Membership is not open to the public. Realtors pay annual dues to belong. The data in the MLS can be then picked up by external real estate sites should you choose to allow your listing to be public.

PMI:  Private Mortgage Insurance.  If you don’t have 20% to put down on your conventional loan, then most lenders will require PMI which provides insurance safeguarding the lender in the event you default on your loan.  Typically you can drop your PMI payment once you have reached that threshold of having 20% LTV.  FHA loans typically require this regardless of your downpayment or LTV.

Realtor®: A real estate professional who is a member of the NAR (National Association of Realtors).

Title Insurance: An insurance policy that either protects the owner’s or lender’s interest in a property. Typically the buyer pays for the lender policy – which is only required when there is a loan. The seller typically pays for the owner’s policy to prove that Aunt Ethel is not going to come claim ownership of the property after you move in. Details in the title policy would show that the sellers do in fact own the property, if there are any judgements or liens, all easements or encumbrances that have been recorded, etc. Read your title insurance policy! 

If lingo is being thrown around that you don’t understand, ask your real estate agent or lender what it means.  I find buyers and sellers sometimes don’t ask the questions because they are worried about bugging us.  It is our job to help keep you informed and answer your questions, so you are not bugging us.  The process will be much smoother if you fully understand what is going on.  Here’s to a smooth real estate transaction!

Buying or selling a home is an exciting time and you can help the process go smoothly by selecting the right agent for you. How might you go about doing that? Here are some things to consider.

Interview realtors. Yes, you can interview realtors to help you with buying or selling. I would recommend choosing three agents to interview. Consider the knowledge of the area you are looking in or where you will be listing your home. It’s so important that they work in your area frequently. It’s also important to find out about their experience and results. Find out how long they’ve been in the business, whether they generally work with buyers and/or sellers or both, and why they should get your business. Check out their testimonials online to see if they are satisfying clients they work with or if the testimonials are nonexistent. You’d be surprised!

With buyers in mind, you’ll want to find someone who can operate on a similar schedule for showings and knows the neighborhoods well where you are looking. Many experienced agents limit their hours so they aren’t available 24/7 and some specifically limit evening work if that doesn’t suit them. If you are only available after 5 o’clock that just wouldn’t be a good fit. Be upfront about your expectations about showings. I like to plan ahead for showings so that sellers are ready and so we can try to see multiple homes at a time. I also make sure my buyers get into homes they are anxious to see in the Spring when our market is the busiest.

For sellers, I think it’s important to see how the agents listings are presented online. Are the photographs professional, is the description well written, and are there any other details that make that listing stand apart from the rest? What other marketing do they do for their listings outside of the MLS? For example, I do floorplan drawings for my listings, send out just listed postcards, post to social media, and have aerial photos as well as drone video done depending on the property.

Ultimately, you’re going to have the best experience if you choose the agent you like and you think you would be happy working with. After all, you will be communicating regularly. Look for similar core values, a passion for real estate, direct answers to your questions, and honesty.