Thursday, August 20, 2015

Ten Things That Can Go Wrong During a Real Estate Transaction

Or, How I Learned to Stop Worrying and Let My Realtor Handle It!

Every day in real estate is a fresh, new day!  That's what I love about this business - no two transactions are ever the same!  Some go so smoothly, you arrive at the Closing table and can't believe that there hasn't been on bump in the road.  

Others...well, not so much!  That's when you will be glad you have an expert Real Estate Broker to help and guide you.

Here are 10 things that can go wrong during a real estate transaction.  I'll bet you can add to this list & I'd love to hear about your experiences.

10.  Buyer remorse - In an era of bidding wars, it's human nature to want to 'WIN!'  A few days after winning the bidding war, especially if buyers have gone significantly higher than list price, buyers tend to feel a little remorse.  Some, to the extreme, ultimately making the decision to terminate the Contract to purchase the home.

9. Unknown structural issues arise - One of the BEST ways to avoid this is to have a pre-inspection when you are listing your home.  This way, if there are structural issues, you have time to remedy them prior to the sale.  Buyers are typically terrified (albeit they don't always need to be terrified) of structural issues, which can cause a cancellation of the sale.

8. SURPRISE!  You've got SOMETHING (leaky pipes, unconnected ductwork, termites)! - This can also be a deal-killer and again, can be avoided with a pre-inspection.  Buyer is going to find it anyway, might as well be prepared and have an expert real estate agent there to help you negotiate.

7.  Buyer has been pre-approved - but, wait!  Buyer has NO CREDIT! - Yes, this can happen.   The lender issued a pre-approval letter based on income only.  The buyer had NEVER had a car loan, credit card or student loan and therefore, when the documents got to the underwriter, the file was rejected!  Of course, the deal fell through but, the seller was able to quickly take the back-up buyer and seal the deal!

6. WAIT!  You can't take it with you!  – Have an expert real estate agent  review the Offer to Purchase in NC and the FIXTURES section.  On occasion, a Seller will remove an item deemed a permanent fixture and the Buyer is NOT happy about it!  Or, a buyer expects an item of personal property to be included and they didn't request it in the offer.  Be sure you know what a permanent fixture is and what it isn't. 

5. Sellers failed to properly complete repairs - As a Seller, your best best is to hire a contractor to make all of the repairs.  Be certain that this contractor offers a warranty as well.  Having someone handle all repairs also makes your life easier - after all, you are packing to move and this is a very busy time for you.  You honestly don't need to be running to Lowe's to buy caulking or plumbing items - just let someone else handle that work for you.  This way, if it is not done properly, the responsibility falls on the contractor to come back and make it right.  Or, as in the case of one of my buyers, seller had to pony up money at closing because carpets were not cleaned as they had agreed (even though they had an "invoice" stating it had been done).

4.  Lender drops the ball - One reason to be SURE to use your Realtor® recommendations when it comes to lenders.  Just as all real estate agents are not created equally, nor are lenders!  We recently had to pull a loan from a lender who had put the Buyers' file on the back burner and truly FORGOTTEN about the file!  Thankfully we realized this (yes, the Seller side realized it first!) in time to have the new lender meet the Closing deadline.  We (the Sellers) demanded that the Buyers utilize one of our preferred lenders who got the job done in 10 days...appraisal and all!

3.  Faulty appraisal - This happens for a variety of reasons but, the top two reasons are that the appraisers have difficulty showing appreciation within a community whereas it's easy to show depreciation.  The second reason this occurs is appraisal management companies send appraisers from out-reaching areas and they are not familiar with the comparable properties enough to generate an accurate appraisal.  

2.  Buyer goes shopping for big ticket item(s) like cars, furniture, Alaska cruise, etc.  - This doesn't fly with lenders if your debt-to-income ratios are tight.  It's best not to make ANY purchases with credit or your savings until AFTER the Closing.  This way, you aren't in jeopardy of losing your new home and all of the money that you've spent in preparation of being the new homeowner (inspection costs, due diligence fees, earnest money deposit, appraisal costs, Title search costs, etc.)

1.  The SELLER decides not to SELL! - Yes, I've had a BUYER change their minds before closing but, never a Seller!  I've heard of a Buyer who had worked through inspections, appraisal and was headed to Closing, only to receive the call, "I'm so sorry but, the Seller has changed their mind - they're not going to be selling their home!"  This can be a very costly mistake as buyers have the right to recoup damages, including but not limited to, any and all costs associated with their home purchase.  If you're thinking of selling your home, be 100% sure that you are prepared to go through with the sale before you list your home for sale!

Thinking of listing your Apex, Cary, Raleigh or other Triangle home?  Give me a call or text at (919-306-9699 or email for more information on how to have a relaxing & successful home sale.


Elizabeth Scott, Realtor®, Broker
Diamond Award – High Sales Volume
e-PRO, Strategic Pricing Specialist
Fathom Realty NC, LLC        
Phone: 919.306.9699

Tuesday, August 4, 2015

Are Home Values Really at Record Levels?

Are Home Values Really at Record Levels?
Last week, the National Association of Realtors (NAR) released their Existing Home Sales Report.
The report announced that the median existing-home price in June was $236,400. That value surpasses the peak median sales price set in July 2006 ($230,400). This revelation created many headlines exclaiming that home prices had hit a “new record”:

Wall Street Journal: Existing-Home Prices Hit Record

USA Today: Existing home sales surge, prices hit record

Though the headlines are accurate, let's take a closer look at the story. It's important to note that this information is NOT evidence that a new “price bubble” is forming in housing. NAR uses the median home price as its measure and not the average sold price. That means that 50% of the homes sold above that number and 50% sold below that number. With fewer distressed properties (that would be lower priced) now selling, the median price will rise. The median value does not reflect that each individual property is increasing in value.
Below are the comments from Bill McBride, author of the economic blog, Calculated Risk. McBride talks about the challenges with using the median price and also explains that in “real” prices (taking into consideration inflation) we are nowhere close to a record.
“In general I'd ignore the median sales price because it is impacted by the mix of homes sold (more useful are the repeat sales indexes like Case-Shiller or CoreLogic). NAR reported the median sales price was $236,400 in June, above the median peak of $230,400 in July 2006. That is 9 years ago, so in real terms, median prices are close to 20% below the previous peak. Not close.”
Earlier this week, the Wall Street Journal covered this issue in detail. In this story, Nick Timiraos explained that this rise in median prices is nothing to be concerned about:
“Does this mean we have another problem on our hands? Not really…There may be other reasons to worry about housing affordability by comparing prices with incomes or prices with rents for a given market. But crude comparisons of nominal home prices with their 2006 and 2007 levels shouldn’t be used to make cavalier claims about a new bubble.”

What does this mean to me?

Home values are appreciating which is good news for homeowners who bought during the 2005-2008 boom. However, they are not increasing at a rate that we should have fears of a new housing bubble around the corner.  
We are desperately in need of more inventory, so if you are thinking of selling -- call me today. I have ready, willing & able buyers and will give you all the info you need on our local market and why my listings consistently sell in less than one week, at or over asking price.
Elizabeth Scott
Fathom Realty


Friday, July 24, 2015

2Q 2015 Home Sales and Prices in Triangle NC

We need your help!  Inventory is too low -- buyers are clamoring for homes and we need yours! 

Here are home sales and prices for Apex, Cary, Raleigh, Holly Springs, and all around the Triangle NC for the second quarter 2015:

The big news is that there are not enough homes available for current buyer activity.  Showings are up 10%.  Inventory decreased 14% since July of last year. What does this mean to you?  If you are thinking of selling, this is the best time to sell in years!.

Pending sales are up 20% since same time last year. 

Closed sales are up:  11% over last year, Up 22% for June!

Days on Market is an astounding 52 days.  This means you can anticipate selling your home in less than 2 months! Most of my clients' homes sold in just days over asking price and with multiple offers.

 Average home price in our area is $273,600 up 6%!  This means that folks who were not able to sell before because their home value had declined are now able to sell as prices rebound. 

 I have lots of buyers who are ready to buy and mortgage rates are still at historic lows. Contact me today to learn you home's value and see if now is the time for me to list your home!

Elizabeth Scott, Realtor®, Broker

Diamond Award – High Sales Volume
e-PRO, Strategic Pricing Specialist
Fathom Realty NC, LLC        
Phone: 919.306.9699

* Source:  Triangle Multiple Listing Service