10 Steps to Buying a Home

10 Steps to Buying A Home…STEP 1 – DEFINE NEEDS FOR YOUR NEW HOME

Congratulations on your decision to purchase a new home! Your first step toward buying your new home will be to analyze your needs. We can help you determine exactly what you want your new home to look like and how it should function for you and your family.

First, write down why you are looking for a new home. For example, are you currently renting and would like to begin building equity? Maybe you recently married and have outgrown your current residence. Or, maybe you received promotion that requires you to move to a new city. These factors will all have a bearing on how you approach your home search.

Second, establish a time frame for buying your home. Depending on your reasons for wanting a new property and the current state of the market in the area you are looking to buy, you should be able to come up with a rough guideline.

Finally, you probably have a mental picture of what your dream house looks like. Turn these ideas into two lists: one should describe your dream home and the other should list features that are absolute must haves. In a perfect world, your new home would fulfill both lists 100 percent, but it is more likely the two lists will turn into a list of priorities, as you get clearer about what you want and what is available.

STEP 2 – PRE-APPROVAL VS. PRE-QUALIFICATION

Now that you know what you want in a home, you need to find out what you can afford. There are two ways to go about this: prequalification or pre-approval for a loan. Either way, you can contact your agent about choosing a mortgage company. Prequalification is the simpler of the two processes. It can even be done online or over the phone. When you contact a mortgage company, they will ask you for some basic information about your finances ? how much money you earn, your debt load, etc. They will take this information and give you a rough estimate of how much of a loan you might qualify for.

Pre-approval is more a more in-depth process. The lender will perform an extensive check of your finances including your credit rating, whether or not you’re a first-time buyer, what your debt load is, how much money you have to put as a down payment, etc. This figure will be a much more reliable estimate of what you can afford.

In most markets, pre-approved buyers are preferred over those that are merely pre-qualified. Being pre-approved lets the seller know you have gone through an extensive financial background check and there should be no unexpected obstacles to you buying their home.

STEP 3 – NEIGHBORHOOD INFORMATION

Now that you have your list of needs and wants and know how much you can afford to spend, it’s time to look at some houses, right?! Well, don’t forget, people don’t just buy a house; they buy the neighborhood the house is in. Think about that…if you found the perfect house but it was in a neighborhood that was not to your liking, would you make an offer on it?

You will need to make another list for the type of area you want to invest in. Consider things like drive time to work and major destinations, amenities such as swimming pools, tennis courts, parking, etc., area schools and the demographics of the surrounding area.

STEP 4 – HOME SEARCH

At this point you will have a good idea of what you can afford and the type of area you will want to invest in. Taking that information into consideration, you are ready to embark on your home search. If you don’t know much about the city to which you are moving, you will want to start by finding areas that meet your criteria and then narrowing your search to particular properties in those areas.

There are a few ways to go about this. Possibly the most efficient way to find homes is to allow your real estate agent to keep you up-to-date on available properties that meet your criteria, and then allow your agent to screen them for you. When your agent presents you with a home that interests you, he or she can arrange for you to tour it at your convenience.

You can find available homes by reading local real estate publications, contacting local Neighborhood Associations, visiting the local Chamber of Commerce, looking on the Internet, or driving through neighborhoods that meet your needs. Driving around a particular area looking for a home that is for sale is good because you can actually see the house, but it can be very time consuming and very “hit or miss.”

Now that you’ve found your dream home, it’s time to make an offer. Your real estate agent will help you determine the offer price by reviewing recent sales of homes that are similar in size, quality, and conveniences and amenities. Your real estate agent will advise you on how to create an offer that will have the best chance of being accepted.

After consultation with you, your agent will create a written contract with your offer that meets all the local and national legal requirements. This document details what needs to be done by both parties to execute the transaction. It should protect the interests of both parties and will ensure your financial position as the buyer.

The contract should include, but is not limited to, the following:

Legal description of the home
Offer price
Down payment
Financial arrangements
List of fees and who will pay them
Amount of the deposit
Inspection rights and possible repair allowances
Appliances and furnishings that will stay with the property
Settlement date
Contingencies

Remember the legalities of this phase are very important. If you have any questions or concerns, be certain to address them with your real estate agent right away.

STEP 6 – NEGOTIATING TO BUY

Once your offer is made you may need to negotiate with the seller to reach an agreement. Keep in mind almost everything is negotiable when you are buying a house. This can give you a great deal of leverage in the buying process, that is, if you have adequate information and you use it in an appropriate manner.

After consultation with you, your agent will create a written contract with your offer that meets all the local and national legal requirements. This document details what needs to be done by both parties to execute the transaction. It should protect the interests of both parties and will ensure your financial position as the buyer.

• Price
• Financing
• Closing costs
• Repairs
• Appliances and fixtures
• Landscaping
• Painting
• Occupancy time frame

Counter offers happen frequently. Remain in close contact with your real estate agent so you can quickly review any changes from the seller. Remember…bargaining is not a winner-take-all deal. It is a business process that involves compromise and mutual respect.

STEP 7 – SERVICE PROVIDER COORDINATION

Once your offer is made you may need to negotiate with the seller to reach an agreement. Keep in mind almost everything is negotiable when you are buying a house. This can give you a great deal of leverage in the buying process, that is, if you have adequate information and you use it in an appropriate manner.

After your offer is accepted, your agent will help you coordinate the activities of service providers and serve as your advocate when working with them. Your agent will make sure these vendors have access to the property to perform their procedures and will oversee the execution of those procedures on your behalf.

One service you may need is a home examination. An inspection of the property, the foundation, and the surrounding environmental may be needed to make sure the property meets the standards set forth in your written agreement. If there are issues or inconsistencies brought to light during this time, it may delay or even nullify the contract.

Insurance is another item that will need to be taken care of. Experts recommend you obtain title insurance equal to the full replacement value of the home. This kind of insurance is purchased at closing and protects the buyers in the unlikely event that the title to the property becomes invalid. Homeowners insurance protects against theft, fire and liabilities. It often includes things such as bicycles, furniture and jewelry. Flood insurance is generally only necessary for flood-prone areas. The federal government issues this kind of insurance.

In addition to aforementioned types of insurance, you may want additional assurance for your new home. Home warranties are one way to protect yourself after you buy. Warranties for new homes protect against plumbing, wiring and structural defects. Existing home warranties cover things like major appliances and structural problems.

Having these procedures done in a timely and professional manner is a must. Investigate each service provider to make sure they are reputable and have a clean operational history. Your agent’s experience in this area will be invaluable.

STEP 8 – BEFORE YOU CLOSE

As the closing date (otherwise known as settlement or escrow) draws near you will need to be in contact with the escrow company or closing attorney and your lender to make sure all necessary documents are being prepared and will be delivered to the correct location on the appropriate date. Find out what form of payment you will need to bring to the closing for any unpaid fees. Make sure that your payment is made out to the appropriate party.

These days, buyers and sellers don’t even have to be in the same room to close a deal. Thanks to computer automation, signed paperwork can be delivered overnight to both parties.

STEP 9 – CLOSING ON A HOME

Closing is where ownership of the home is legally transferred from the seller to the buyer. It is a formal meeting that most parties involved in the process will attend. Closing procedures are usually held at the title company’s or lawyer’s office. Your closing officer coordinates the document signing and the collection and disbursement of funds.

In order for the closing to go smoothly, each party involved should bring the necessary documentation and be prepared to pay any related fees (closing costs). There may be more than one form of acceptable payment for your closing costs so ask the closing officer which form of payment will be required and to whom it should be paid.

Sellers sometimes pay for a portion or all of the closing costs, depending on local market conditions, terms of the purchase contract, and the seller’s cash and timing considerations. Any such concessions should be acknowledged in writing. Most lenders will allow a credit from the seller to the buyer for the non-recurring closing costs. However, they usually won’t allow a credit that reduces the amount of the buyer’s down payment or any of the buyer’s recurring costs, such as expenses for fire insurance premiums, private mortgage insurance (PMI) or property taxes.

STEP 10 – POST-CLOSING

Congratulations on the purchase of your new home!

Now that you have taken ownership of it you will need to have your electricity, cable and phone set up. Also be aware of typical homeowner expenses such as Neighborhood Association fees, landscaping costs, and annual taxes and budget for them accordingly.

You Don’t Want to Chase the Market

Things change, kids grow up, jobs transfer us to new places and all of a sudden there’s a house that needs to be sold. In our current Truckee real estate market, sellers are often asking us what they need to do to get their homes successfully sold. [SinglePic not found]
[Illustration: If sellers fall behind a market with falling home values, they can end up chasing the market down, because home values are always falling faster than their price reductions].

The first thing a seller must do if he wants to sell his house is to price it correctly for the market we are in. Many of the homes that aren’t selling are priced too high. According to MLS data, the median sales price for single family homes sold in Tahoe Donner during the 2nd QTR,  dropped 13.8% from 2005 to 2008.

If you need to sell your property now, it is important to price “on the money” right from the start. Chasing the market is not the position you want to be in when you are trying to sell your house. In other words, you don’t want to be two steps behind the market. You want to be slightly ahead and if you want your house to sell it should be priced better than your competition.

Pricing a home for sale is not an easy task for anyone. It’s tough to be objective because a house represents so many things to each person. It is often said that sellers are the last to know when it comes to the value of their home and buyers, on the other hand, are often ahead of the game. Buyers know the market better than most sellers and they are aware of the risks involved in today’s market and they gauge the price they’ll pay accordingly.

When it comes to pricing your home for sale, we give you individualized and objective information so that you can make an informed decision. In addition to determining the right price for your property, based on an in-depth analysis of comparable active and sold listings, we will also create a marketing program for your home. We utilize Internet resources, print advertising, open houses, virtual tours and more. We work hard at creating a win-win opportunity for everyone.

The state of our current real estate market has provided some excellent opportunities for new buyers to invest in the Truckee real estate market and it can also be a good time for others, who already own, to sell and buy a bigger or different place while the prices are so good.

Our goal is to help you sell your home for the most amount of money in the shortest amount of time and to help find good investments for those who are ready to make purchases.

Lake Tahoe is #1 Ski Destination Booked on Orbitz

TRAVEL & RESORTS – Resort Info & Directory

Written by Peter Kray / SkiPressWorld.com

Wednesday, 29 October 2008 09:05

North Lake Tahoe (Ski Press)-Lake Tahoe is the most popular ski destination in the U.S. for hotel and vacation packages booked by travelers at Orbitz.com for travel between November 1, 2008 and April 30, 2009 (as of October 14).
 
This is the second consecutive year that Lake Tahoe has received top honors by travelers at Orbitz.com, as it was the number one destination for travel between November 20, 2007 and May 1, 2008.
 
“Orbitz is one of the largest online travel websites in the world,” said Director of Tourism Andy Chapman of the North Lake Tahoe Resort Association (NLTRA). “To be ranked as the site’s most popular ski destination in the country for the last two years is tremendous. Our own numbers echo Orbitz’s findings; despite the challenging economy, visitors are still traveling to North Lake Tahoe for the upcoming ski season and many are booking early especially for the busy holiday season.”
 
North Lake Tahoe has enjoyed a long-term relationship with Orbitz according to NLTRA Leisure Sales Manager Jeremy Jacobson, who regularly educates Orbitz staff about the destination and how it differentiates from the competition. Orbitz offers a host of North Lake Tahoe inventory for the budget conscious to the high-end traveler both on and off the mountain, as well as lakeside. North Lake Tahoe also provides Orbitz with a season-long Interchangeable Lift Ticket, which Orbitz users can purchase, giving them the flexibility to ski or ride any of North Tahoe’s seven ski resorts, representing a combined 12,000 acres, on any given day.

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Buyers: Timing the Real Estate Market

Is There a Perfect Time to Buy Real Estate in Truckee?

In a soft housing market, like we are experiencing now in our Truckee real estate market, buyers often wait on the sidelines for a clear sign that the market has reached rock bottom before they make an offer on the property they’ve been eyeing. There are two problems with this strategy. Too many times, the “other guy” that was eyeing the same property makes his move and purchases the property before you. The other problem is that too often we don’t know that the market has hit the bottom until it has turned the corner and starts going back up. You can only know for sure that a market has turned through hindsight. In other words, you can’t time the market

A risk of buying in a slow market is that the value of what you buy might drop before it rises. Or, prices could stay flat for some time, which means that you won’t build equity unless you pay down principal on your mortgage. If you should have to move during a time when prices are soft, you might not be able to sell for the amount you paid. To decrease this risk factor, don’t buy for the short term.

Give careful consideration to how you finance your purchase. Stay away from mortgages that have short due dates and balloon payments. If the market in your area stays soft for longer than anticipated, you don’t want to be caught having to refinance at a time when your home might not appraise for the price you need to complete the transaction.

A benefit of buying in a soft market is that you have the opportunity to buy at a reasonable price. But the key is to buy the “right property” at the “right price”. As professional Realtors, we can help you determine if a property is a “good buy”. We will give you solid advice about the home you may want to purchase and we will help you throughout the entire process.

Make an Offer the Seller Won’t Refuse

It’s No Different in the Truckee Real Estate Market – There is Strategy to Making Your Offer Attractive…

Look at negotiating as a back and forth process and strive for a win-win scenario for everyone. You and the seller may have different ideas about what price the property should sell for. However, you’re united in a common goal of consummating a deal. The challenge is to resolve your differences through a process of give and take until you either reach your common goal, or decide to go your separate ways. Sometimes this will happen quickly and sometimes it’s a drawn out process that can take several days or even weeks. In our current Truckee real estate market, we are seeing as many as 5 and 6 counter offers pass between buyers and sellers before a deal is negotiated.

Buyers often think that if they start out offering too high initially, they’ll end up paying too much. Your initial offering price should be high enough to entice the seller into a dialogue. It’s a price to get the ball rolling. From there, you can move up in small increments. As your Truckee Realtors, we will help you determine the offering price that puts you at the best advantage throughout the negotiations.

When you make an offer and there’s no competition from other buyers, your initial offer price should leave you room to move up in price. But, it should not be so low that it’s insulting to the seller. Otherwise the seller might not respond at all. Working with both seller and buyers, we have been on both sides of the negotiating table with our clients and we know from experience that an offer that’s too low could give the seller the impression that you’re too far a part, you can’t afford more, so there’s no point in issuing a counter offer.

It’s important not to get so caught up in negotiating the price that you overlook other opportunities for building a good relationship with the seller. Good negotiations have a sense of fairness about them. During the process of your negotiation, we will collectively brainstorm all the possible ways that we can accommodate everyone. Keep in mind that a win-win scenario will have the best outcome.

Price, while important, is not the only thing that makes an offer appealing. Do the sellers need a quick close? Would they prefer a longer close because they have other obligations and can’t be moved out in 30 days? If so, the sellers might be willing to give up more on the price for a close of escrow that accommodates their particular needs.

If you are not planning to finance your purchase, an All Cash offer can be very appealing to a seller. Sometimes a seller will accept a lower price if they know the deal is not hinging on a loan contingency.

In the Truckee market, many homes are second homes and it might be worth asking if it would it be easier on the sellers if they don’t have to move all of their furnishings out of their home. Maybe you will want to negotiate and purchase some or all of the furnishings. This can be convenient for the seller and also for you.

Lastly, it always makes a seller feel confident when you are timely in making responses. Selling and buying can be stressful on both parties and being honest and upfront can go a long ways in making a deal come together.

We like to negotiate win-win transactions for our clients and we will give you different options for starting points and strategies that we think may be best for you and a particular purchase. Give Robbie and Karen a call today at (530) 412-0583 and we’ll help you get started.

We also encourage you to leave any questions and comments here. Thank you.

Tahoe Donner Homes Sales on the Rise!

Tahoe Donner Homes Sales Doubled From May to June

MLS stats for Tahoe Donner shows us that 11 Single Family Residences sold in May 2008 while 22 Single Family Residences sold in June of 2008! Buyers, who have been sitting on the fence waiting for prices to drop, are taking advantage of their strong position to negotiate. Savvy buyers are making offers on the properties they’ve been eyeing and the skeptics are watching the properties they wanted get purchased by someone else. As a seller, if you can’t wait for the market to turn around, put your property on the market now. In this market, waiting simply eats away at your listing price. Consider how long it will take and how much prices will have to rise to offset the payments and cost of waiting. It is time to make a move. Whether selling or buying, we can help create a unique strategy for you.