Inspection at the Beach

One of my clients just purchased a home on the beach on Camano Island, WA. For reference, that is just north and west of Everett. It is 10:00am and I am at the inspection for the property and the inspector is inside doing what he does, while I am just sitting on the beautiful deck overlooking a seemingly perfectly still bay. The sun is shining and must be in the 70s already and I’m doing a little work on my computer while over looking this beautiful view. This is hands-down the best inspection I’ve ever had to attend.

Contingent vs. Non-Contingent Offers

Are you Selling your current home and purchasing another? What is the correct way to go about doing that? In the past, our market allowed the ‘contingent’ offer. For those of you that don’t know what that is, a contingent offer is placing an offer on a house with a contingency that you would be able to have your home on the market and have accepted an offer on your current home within a specified number of days. Once that time was up, if your home didn’t sell, you were able to get back out of the home purchase without any damages. But starting in the 2000s, our market was so hot, homes were flying off the market and the contingencies basically left our industry.

Guess what? Our market is good, but it’s not what it was 3 years ago… and the contingencies are making their way back. Sellers don’t like them and they’re not back as much as they were before our market rise, but I’m seeing quite a few of them lately.

What does that mean for you? It means a couple things: If you’re selling your home and purchasing a new one, you MAY have the ability to place a contingent offer. It might not be a very strong offer, but the possibility is there again. But it also means that you might receive offers on your home that are contingent. So be prepared for that. Not that you have to accept the offer, as a seller, but don’t be surprised if it shows up.

What are the other options? Here’s a quick synopsis of alternative ways that may work as well:

Put your home on the market, be looking around at other homes that you may want to purchase, and when you accept an offer on yours, request a 45 day closing time and pull the trigger on one of the places that you’ve already seen since you’ve been looking already. I am in this situation specifically with some of my clients right now. We know their home will be on the market for a little while, so we’d rather not stress out over everything and we’re just casually looking for places as they come up and we’ll be ready to go when that time comes.

Risk: Your new dream home may not be available when the time comes to pull the trigger.

Purchase the new place, assumimg the lender you’re using on the new home will approve you for both homes temporarily. Then put your home on the market and hope it sells quickly.

Risk: Your current home may sit on the market for a little while and you’ll have to make two mortgage payments until the other sells.

I am also working with some clients in this situation and the home is unfortunately not selling as quickly as we’d like. We’re having to do everything possible to get it sold now as two mortgage payments isn’t exactly fun. I also did this on my own personal homes a couple years ago and it took our home a little while to sell, even after we’d moved into the new home. But in hind-sight, it was worth the pain to get the home that we live in now and love.
3. Buy the new home and keep the old home as well, but as a rental. If you can get a renter into your current home, you can qualify up to 75% of the rental income as actual income on the loan of your new home. Then, someone else is paying for your home, you get the tax benefits of writing off your interest every year on the place you don’t live in, AND you get all the benefits of the appreciating value of both homes! This option is not for the faint at heart, but a great option if you’re looking for a good way to invest. Especially in our strong Seattle market.

Risk: Well… you’re now a landlord! And unfortunately your mortgage company on that home doesn’t care if your tenants paid rent that month or not.

These are very real situations in today’s market and there is a different answer for every different person and their comfort levels. If you have questions, call me or email me and I’ll help you figure out the best way for you.

Good luck!

Current Market Trends

What is Our Market Doing Right Now? (5/31/07)

Other than going up? Well, that depends on each market. The word ‘market’ is such a broad term that we really need to break it down into categories. The first would be the area/city/neighborhood. Each city sells differently than another. For example, Bellevue is much different than Renton. One is not better than the other, but they are VERY different markets.

Secondly, you need to break it down into price-range within each area market. East Bellevue/Lake Hills is a different beast than West Bellevue (Medina/Clyde Hill/Enatia). The prices are much different but both are great markets. We’re seeing good increases and homes are selling quickly in both areas of Bellevue. And that carries over to neighboring cities like Redmond & Kirkland as well. But again different markets when looking at prices, but all selling very well. Let alone the Bellevue condos being built. Someone told me that there are more cranes erected in downtown Bellevue right now than any other city in the U.S. Don’t quote me as saying that is fact, but I’d believe it.

In getting up to Bothell, that is a whole different ballpark. Bothell is developing like crazy. New homes everywhere you look. They’re beautiful, but there is so much competition that they’re keeping prices down and inventory high. Recently built resale homes are sitting especially long. Because people LOVE the ability to buy ‘new construction.’ Had we even really heard that term prior to 3 years ago? Now people are constantly saying, “We bought new construction.” (Guilty!) But these poor resale homes don’t stand a chance unless they’re way underpriced or are in a very desired neighborhood. So prices there, whew… different everywhere you look in Bothell. But they’re certainly not skyrocketing.

Where do you live? Do you want information on an area didn’t talk about? Let me know and I’ll get it for you.

Good luck!

Ah, Rats...

We don’t like to think about them, but they’re likely there. I learned a lot about rats in the past few weeks. They enter in crawl spaces, especially and love to live there. Many of us may have them in our crawl spaces and we don’t even know it.

Unfortunately, when they come in, they leave their ‘scent’ under your house and that scent attracts other rats. And eventually… well, you know the rest.

Why do I bring this nasty topic up? Because it would be good to know about them PRIOR to it being a big issue and having to replace all of your insulation, etc in the crawl space. Not a fun topic, but important nonetheless, especially if you have young children or are planning on selling your home sometime soon (because an inspector will find them and you’ll probably have to take care of it anyway).

Good luck!