Lee Morof's Real Estate Blog

Are you thinking about buying or selling a home? If you don’t know a real estate agent or have a referral to one, you may end up working with someone unfamiliar who you will need to build a relationship with. Of course, as with any relationship there’s always a chance that things can go sour.

In today’s blog post we’ll share three easy ways that you can ruin the trust and rapport that you’ve built with your real estate agent.

#1: Lie or Embellish the Facts

When you ask a real estate agent to represent you in the home buying or selling process they’re going to need accurate information to help you make the best decisions. Lying or embellishing the facts can cause significant issues and should obviously be avoided.

For example, if your agent asks you how much you can afford for your new home, give them an accurate figure based on your mortgage pre-approval, your income and your current financial situation. If you’re selling your home and your real estate agent asks you about the home’s maintenance history, be honest and don’t try to cover anything up.

#2: Cheat on Them with Another Agent

Once you have a real estate agent searching for that perfect new home, they may need to expend quite a bit of effort in order to find exactly what you’re looking for. Imagine how hard they would work if they discovered that you’re having another real estate agent perform the same job, but only one of them will be paid for their work?

Don’t cheat on your real estate agent. If you feel that your agent is doing a poor job or you could find someone better, let them know. It’s better to move on than to have professionals working behind each other’s backs.

#3: Fail to Be Trusting or Respectful

If you fail to show trust and respect for your real estate agent you can rest assured they’re not going to bend over backwards to help you squeeze out that extra discount or get your home sale closed as quickly as possible. Treat your real estate agent as you wish to be treated and they’ll be more than willing to do their job.

Buying or selling, an experienced real estate agent is the best way to ensure that your transaction goes according to plan and that you accomplish your goals. When you’re ready to discuss buying a new home or selling your current one, contact your real estate agent and they’ll be happy to assist. Don’t forget to keep the above points in mind!

Whether you’re about to close on a lovely new house for your growing family or a stylish beachfront condo so you can retire close to the ocean, one thing is certain: you’re going to face a variety of closing costs. Insurance, taxes, financing fees, title fees, attorney fees and other costs will need to be paid, and if you’re a savvy buyer you’ll do everything you can to save on them.

In today’s post we’ll share three quick tips that can help you reduce your closing costs when you buy your next home.

Tip #1: Include Closing Costs in Your Negotiations with the Seller

As closing costs are a part of the real estate transaction they’re an excellent item to include in your negotiations with the seller.

For example, if you consider that closing costs might be 3 or 4 percent of the home’s value you can try to bring the seller’s asking price down to get those costs included. Or, you may be able to entice the seller with the prospect of a quick sale if they are willing to pay your closing costs in order to get you to sign on the dotted line.

Tip #2: Compare All of Your Mortgage Options

If you’re using mortgage financing to cover some of the up-front purchase cost of your home you’ll have other closing costs to pay including lender fees, mortgage insurance and more. Be sure to compare all of your options with your trusted mortgage advisor to ensure that you’re getting the best possible deal and paying the least amount in fees and interest.

You may also be able to save a bit on your closing costs by choosing a “no points” mortgage. In this type of mortgage you’ll end up saving on closing costs but you’ll be left paying a higher interest rate. Spend a bit of time doing the math to determine the best course of action.

Tip #3: Ask About Every Fee You’re Required to Pay

Finally don’t forget that you’re the customer and that you have the right to know about each one of your closing costs and why you’re expected to pay them. Being informed about all of the various items in your transaction will help ensure that you’re not paying something you could have avoided.

There you have it – three excellent tips for reducing your closing costs when you purchase your next home.

Does your home feel like it’s starting to burst at the seams? Many homeowners across the country can relate to this feeling having bought a home only to run out of space due to a growing family or for other reasons. Let’s take a quick look at a few questions that will help you to determine whether buying a new home or expanding your current home is the best choice when you’re in need of some extra space.

Why Are You in Need of More Space?

The first question you’ll need to answer is…”why?” Are you running out of space because you’ve decided to start a family and have another child on the way? Or perhaps you’ve decided to start a business out of your home and you’ve outgrown the small room you had set aside as your office? Whatever the case, a major renovation or a move to a new home are both major decisions and ones that shouldn’t be made lightly. Sit down with your family and consider why you need more space and what you would do with a larger home if you had one.

How Much Space Do You Need?

“How much space” is another consideration that you’ll need to make in order to come to the best decision between expansion and buying a new home. If you find that your needs are perfectly suited except for that missing bedroom you may want to undergo a renovation. Conversely, if you find that you could use at least 2 or 3 new rooms and some extra room in the garage, you may want to start shopping for a new home.

Note that expanding your home to add an extra bedroom or to finish the basement will provide a limited amount of additional space – space which may end up feeling constrained later if your family or needs continue to grow. If you’re thinking bigger over the long term, you’ll likely be better served in finding a larger home that has extra room that you can grow into.

Other Factors for Consideration

If you’re thinking about expanding your current home you’ll want to consider how this will impact the other rooms in the house. Are you going to feel the need to renovate every room once that new bedroom is added? If so, is renovating a wise investment or should you simply move on to a newer home?

Living in a more spacious home is a liberating experience that your entire family will enjoy. Contact your local real estate agent today to learn more about buying larger properties and to view available real estate opportunities in your area.

Last week’s economic reports related to housing and mortgages were few, but construction spending, the Fed’s Beige Book report, non-farm payrolls and the national unemployment report indicated trends for the end of the year.

Construction Spending Increases

U.S. construction spending rose by 1.10 percent in October according to the Commerce Department. This reading translates to a seasonally-adjusted annual rate of $971 billion. Analysts had expected an increase of 0.70 percent based on September’s original reading of -0.40 percent, but September’s reading was revised to -0.10 percent on Tuesday. Private spending on residential projects increased 1.30 percent.

Federal Reserve Beige Book Indicates Economic Improvement, or Not

Oil prices were cited by participants in the Federal Reserve’s survey of regional business leaders; Texas and the Gulf coast areas noted that falling oil prices were a threat to those economies, while other participants said that lower prices at the gas pump were putting more cash in consumers’ pockets. The report noted upward pressure on both minimum wages and higher wages for skilled workers. Wages have remained mostly flat while consumer costs have increased; higher wages can provide more discretionary income for consumers and may build confidence for would-be home buyers that have been waiting for more positive economic trends.

Freddie Mac: Mortgage Rates Down

Freddie Mac’s weekly survey of average mortgage rates brought good news for home buyers and homeowners seeking to refinance their mortgages. The average rate for a 30-year fixed rate mortgage fell from 3.97 percent to 3.89 percent. The average rate for a 15-year fixed rate mortgage fell to 3.10 percent from last week’s reading of 3.17 percent and the average rate for a 5/1 adjustable rate mortgage dropped to 2.94 percent from last week’s reading of 3.01 percent. Average discount points were unchanged for all loan types at 0.50 percent.

Labor Data Mixed, Unemployment Rate Unchanged

Weekly jobless claims beat expectations by 1000 fewer jobless claims with a reading of 297,000 new claims against expectations of 298,000 new claims. The prior week’s reading was higher at 314,000 new jobless claims. The Commerce Department also released Non-Farm Payrolls figures for November with 321,000 jobs added against expectations of 235,000 jobs added and October’s reading of 243,000 jobs added. Holiday hiring and climate related slowdowns are expected to impact year-end labor statistics. Analysts prefer to look at trends occurring over several months to determine labor trends.

What’s Ahead

Next week’s scheduled economic news includes reports on November retail sales and consumer sentiment in addition to Freddie Mac’s mortgage rates survey and the Commerce Departments weekly jobless claims report.

Have you prepared your home for the winter? With colder temperatures starting you’ll need to spend an hour or two getting your home ready to deal with the possibility of harsher weather and below-freezing temperatures, depending on where you live. Let’s take a look at a few quick home maintenance tips that will help you get your house ready for the cold of winter.

Check Your Roof, Gutters and Spouts

Your roof is one of the most important structural elements in your home and one that is going face the brunt of any inclement weather that passes through your area. If you feel comfortable on a ladder, climb up and quickly inspect the roof for damage or missing shingles. You’ll also want to clean the gutters and drain spouts, removing leaves and other gunk so that water can flow freely from your roof to the ground.

Drain Your Faucets, Hoses and Irrigation System

If you have exterior faucets and hoses you’ll need to flush out and drain any remaining water before storing them away for the winter. In-ground irrigation systems should have an anti-freezing treatment performed by a professional as freezing can cause a significant amount of damage to pipes and outlets.

Check Your Doors and Windows for Drafts

Leaky windows and doors can cause your heating bill to skyrocket, so spend a few minutes going around the house to inspect seals and frames to see if anything is leaking. Pay close attention to any single-pane windows as leaks can appear over time due to expansion caused by temperature fluctuations. It takes just a few cents worth of caulking to save many dollars in wasted heat.

Store Your A/C and Prep Your Furnace

Finally you’ll want to ensure that your air conditioning unit has been fully shut down and properly stored. If you have an in-ground unit, you’ll also need to cover it to protect it from rain, snow and wind. If you use a furnace to heat your home, be sure to clean or replace its air filter and consider firing the entire system up so you can check the ducts for leaks.

These home maintenance tips will help keep your home in peak condition and prevent damage that can reduce your resale value. If you’re thinking about selling your home, give your local real estate agent a call and they can assist you with getting the process started.

Are you about to buy a house or condo for the first time? Congratulations! Owning your own piece of real estate is a liberating experience and one that will provide you with the foundation to build your personal wealth and equity. Once you own your own home you’ll be responsible for a variety of new costs, including property taxes which are assessed by your local government to pay for municipal services. In this blog post we’ll share how property taxes work and what you can expect to pay when you buy your new home.

It All Begins with a Local Property Tax Assessment

As mentioned above, local governments assess property taxes as a means for paying for police officers, fire fighting services, road maintenance and the other various costs that come with running a town or city. Whether you’re buying a house, a townhouse or a condo, the property that your home sits on is inside of an area known as an “assessment area”. When the local government determines what your local tax levy or tax rate will be, they will assess your home based on the real estate market value of similar homes in the area. You can multiply your tax rate by the assessed value of your home to determine how much you’ll owe in property tax.

Property Taxes as Part of Your Closing Costs

When you close on your new home you’ll have to pay property taxes, and your real estate agent will help you to understand how much these taxes will be and how they will be paid. In most cities and counties you’ll pay a pro-rated amount of property tax that covers the time span from the date you purchase the home until the end of the year, after which time you’ll be paying your full assessed rate.

Don’t Forget Your Overall Tax Picture

Finally, don’t forget that property taxes can be factored in to the rest of your overall tax picture. Check with your accountant or another financial professional to determine whether or not you can write your property taxes off against your income tax to save some additional money. There are numerous tax benefits to owning a home, so it’s best to start using them from day one.

As with all other taxes, property taxes are a fact of life that every homeowner faces. When you’re ready to buy a new home and to learn more about how property taxes will affect your purchase, contact your local real estate agent today.

Whether you’re buying a ski-in/ski-out condo at your favorite resort or you’re thinking of picking up a small home in a busy tourist area, buying a property for short-term rental purposes can be an excellent investment that quickly begins to provide additional revenue.

Let’s take a quick look at a few steps that you can take to maximize the revenue that your investment properties bring in each month.

Upgrade Your Home to Give It a Luxurious Feel

It should go without saying that if you want your home to rent for a high price it has to have a significant amount of value behind it. After you purchase the home, spend some time on upgrades that help to enhance the home’s beauty and usability. If possible each sofa should be a sofa-bed so that additional guests can stay the night. Upgrade the televisions, have Wi-Fi internet access available and provide a phone number that guests can call if anything goes awry.

Professional Photos and Copywriting

If you’re renting your property out to short-term or vacationing tenants you’re most likely going to use online services like VRBO, HomeAway or AirBnB to attract new business. While these sites have a lot of visitor traffic you’re also going to face a high level of competition from other property owners in the area. It’s worth paying a professional photographer to take pictures of your home as well as having a professional copywriter handle the sales copy for your listing. These are one-time costs that can help you to defeat your competition and close high-ticket clients.

Cater to Large Groups or a Niche Crowd

There are a number of “niche” travelers out there and if you can cater to these groups you’ll find that you’re able to charge more than the average vacation property. For example, you may be buying a home in a popular wedding destination that can be marketed to couples who are being married. If you’re buying a larger 3 or 4 bedroom home, be sure to note that it can house large groups who may be traveling together.

Referrals and Repeat Business

Finally, don’t forget to ask your clients to refer you to their friends and family who many want to stay in your unit, and always invite them to return in the future. You may want to consider offering a discount to repeat visitors to encourage them to visit annually.

Renting out your vacation home or investment property can provide a lucrative income stream as long as you have a professional approach and focus on providing a high level of customer service. When you’re ready to start shopping for the perfect investment properties, contact your local real estate agent.

Last week’s scheduled economic events were packed into Tuesday and Wednesday, but several housing-related reports were released including the Case-Shiller National and 10-and 20-City Home Price Indices for September, The FHFA House Price Index also for September, and New and Pending Home Sales for October.

Case-Shiller, FHFA Report Slower Growth in Home Prices

According to Case-Shiller home price indices released Tuesday, the national rate of home price growth has slowed from August’s year-over-year reading of 5.60 percent to September’s reading of 4.90 percent. This was the lowest rate of home price growth in two years and was seen by analysts as a positive development in terms of sustainable price growth.

Double-digit percentage gains in home price growth in 2013 and earlier this year drove many would-be home buyers to the sidelines as narrow inventories of homes caused bidding wars in high-demand areas. 20 cities tracked by Case-Shiller had mixed results, with home prices falling in nine cities, rising in nine cities and prices were unchanged in two cities.

FHFA, the Federal Housing Finance Agency and overseer of Fannie Mae and Freddie Mac, reported year-over-year price growth of 4.30 percent in September against August’s reading of 4.80 percent. Lower price gains for September were expected as the prime period of summer sales wound down. FHFA reports on home prices related to mortgages and properties held by Fannie Mae and Freddie Mac.

Pending and New Home Sales Show Mixed Results

The National Association of Realtors® reported that the Pending Home Sales Index dipped to 104.3 in October as compared to September’s reading of 105.1.Lawrence Yun, chief economist for the National Association of Realtors®, said that lagging wage growth and tight mortgage credit conditions were stalling demand for homes. Pending home sales usually close within two months and serve as a gauge for upcoming home sales and mortgage activity. A reading of 100 for the Pending Home Sales Index is equivalent to pending home sales performance in 2001.

Better news came from the Department of Commerce New Home Sales report for October. New home sales achieved a five month high with a reading of 458,000 new homes sold on a seasonally-adjusted annual basis. October’s reading was 0.70 percent higher than September’s reading of 455,000 new homes sold, but missed analysts’ expectations of 469,000 new homes sold. New home sales increased by 1.80 percent year-over-year with regional rates as follows:

• Midwest: +15.8 percent

• Northeast +7.1 percent

• West -2.7 percent

• South -1.9 percent

The median price of new homes rose to a record high of $305,000 in October. The supply of new homes rose to a 5.60 month supply from September’s reading of a 5.50 month supply of new homes.

Mortgage Rates Fall or Flat, Jobless Claims Rise

Freddie Mac reported that the average rate for a 30-year fixed rate mortgage fell from 3.99 percent to 3.97 percent; the average rates for 15 year mortgages and 5/1 mortgages were unchanged at 3.17 percent and 3.01 percent respectively. Average discount points were unchanged for all loan types at 0.50 percent.

New Jobless Claims rose to 313,000 last week and surpassed 300,000 for the first time in several weeks. Analysts had expected a seasonally-adjusted reading of 288,000 new jobless claims. Analysts said that a rise in claims could indicate a slower pace in hiring, but said that weekly readings are too volatile to indicate a trend. The four-week average of jobless claims was 294,000 new claims, which was near an eight-year low.

What’s Ahead

Next week’s scheduled economic events include Construction Spending, the Fed’s Beige Book Report, Non-Farm Payrolls and the National Unemployment Rate. Freddie Mac’s PMMS report on mortgage rates and Weekly Jobless claims will also be released as usual.