In this video we have Nicole Kampenhout of Nicole and Company showing us how she would stage our dining room. Everything she uses are items that we had already. Virtually all of our listings we have a stager come out and make suggestions or changes in order to get the best experiance for the soon to be buyer. We have found that Buyers buy on emotion and then justify the price. Nicole, helps us create that emotional experiance for the buyers.
When buying a used car unless you are a mechanic, it is a good idea to take it to a mechanic and have them take a look, “under the hood”. When it comes to buying an older home you should always be sure of what you are buying. Of course you can’t, put a home up on a car lift and take a look, but there are a lot things you can look for. Some of those things, could be lead paint, mold, meth, electrical, structural issues, roof issues, the list is large and important. An ofter forgotten or neglected inspection is of the sewer line.
If you have ever seen a sewer line replaced, it isn’t pretty. Usually, it involves digging an enormous trench across your front yard and tearing up the sidewalk and partially into the street. The costs very, but here locally it is between $13,000 – $17,000. For all of our clients who are buying homes, we recommend having a plumber “scope” or camera the sewer line prior to buying the home. The plumber will usually find a clean-out in the main sewer line in the basement, or run the camera from the main line on the roof, or remove a toilet and scope from there. The camera is inserted into the pipe and pushed through the sewer line on a cable with the goal of getting to the main sewer line in the street. The plumber has a recording device that records what he sees and usually the camera will have a distance gauge that shows up on the screen so he knows how far into the pipe the camera is.
There is nothing glamorous in sewer pipes. Usually, they are full of toilet paper and other debris. What the plumber is looking for are things like cracks in the pipe, bellies in the pipe, and places where the pipes have slipped at the connections. These are all signs of future problems. Sometimes, the debris can mask other problems or look like problems that aren’t really a problem. In those cases it is best to have the line jetted by the plumber and then camera the line again. Many times, we have had the line cleaned out and what we thought was a problem was a crack in the pipe was nothing more than some old debris.
The cost varies between plumbers, but to camera the line it is usually about $200. To jet and clean out the line can be another $200-$300 dollars. So, the process isn’t cheap, but it is worth the piece of mind knowing your sewer is alright. Most homeowner insurance companies do not cover the main sewer drain. Some 3rd party companies do. Here in Salt Lake City, we have a company that covers the cost of replacement for around $7 a month. This can be a good deal if you end up seeing the possibility of a future problem, but can’t get it fixed when first buying the home.
Here are a couple of “dirty movies” showing a before and after clean-out of the same drain. When we saw the first video, we were sure that there was a problem with the sewer, but after cleaning it out, it was actually in really good shape.
How much ‘fixing’ are you really prepared to do? The romanticism behind reinvigorating the forgotten can be for some an insatiable lust. We would know. We have bought and remodeled 20 homes in the last 15 years. Now most of these homes were “flips” but a few of them were labors of love that we lived in for years. The majority of these fixers were built between 1920 and 1960, with a few newer duplexes mixed in for good measure. The biggest exception to that would be our most recent home being our oldest, built in 1912. It took the entire summer and some of the fall of 2016 for the major renovations, but here we are in summer of 2017 and still making changes. This one falls under the labor of love category. Read more about it in our upcoming book 19 Houses, coming out this fall!
When buying any home you should always make sure to do your due diligence and get all the inspections you need and make sure you’re ready for this massive investment. For older homes, unless they’ve already been renovated, inspections are more of a starting point or just a good idea as to what you’re about to dive into. Usually it’s not so much as to “if” it breaks, as “when” it breaks or “how many times has it already been fixed.” When you buy an older home you normally get older technology, appliances, fixtures, and so on. Our 1912 home came with a few big surprises that required a decent amount of time and money to deal with. When your home is over 100 be prepared. Even though the headaches and late nights tend to lead to gray hairs in the end we love to remodel. It’s just one of those Love / Hate relationships.
Now, I’m not saying “don’t buy that old house” (unless I want it, then yea you don’t want that one, it’s ugly), I would just recommend being well prepared.
Here are 5 Tips to get started:
#1Have a large contingency plan in your budget. Once you start making small changes, they can turn into large changes quickly. We usually estimate all the known costs and add 30% for things we don’t know about.
#2Hire the right people. (our vendor list) Contractors come in many shapes, sizes, and experience. Many contractors may say they understand old homes, but they don’t. Ask for references and examples and hopefully pictures of their work. Keep in mind, that the best contractor for your project may not be the least or most expensive. Get multiple bids, and let them know you are getting multiple bids.
#3 Styles change, be prepared. It might be trendy to have a red kitchen cabinets (it’s not by the way), but will it stand the test of time? If you decide to go with current trends be prepared to change it in the next 5-10 years. We always try to add a bit of modern style with the classic looks that will stand the test of time. For example, our new kitchen has very modern blue glass tile backsplash with a classic style of cabinets. When, not if, the tile goes out of style we can replace it for a few hundred dollars. The cabinets, not so easy to replace.
#4 Fix it right not cheap. Sure, it can be less expensive to replace only part of the plumbing, but that doesn’t mean you should. Some things are best to fix it all upfront rather than just in pieces. Plumbing is a good example. You remodel the kitchen, but only replace part of the plumbing. At some point, the old pipes will burst and ruin your new kitchen. It may cost a few hundred to a few thousand dollars (depending on the house) extra to replace the pipes when your kitchen is gutted. Now, since you cheaped out you get to replace the plumbing, kitchen floor, and possibly your cabinets.
#5 Start up and work down. It is really tempting to start painting and getting your new appliances. Don’t do it, don’t give in. This isn’t HGTV. Start your remodel with the roof (if needed) and work your way down. After up to down, work inside out. Meaning, replace what needs to be replaced inside the walls. This could be structural fixes, plumbing, wiring etc. Then, you can start to put it all back together. If you are doing a kitchen, the very last thing you do is the appliances. If they are on the site before it is finished, they are always in the way and become tool storage for contractors. We had a worker drop a huge drill on our stove and completely destroy the control mechanism. That was a $350 lesson.
The list really goes on and there many blogs (more on our blog as well) , books, shows and articles that you can research to better prepare yourself. We will soon release a book of our own that dives further into our homebuyer experiences but until then, give us a call or send us an email if you have any questions or just want to know more.
Location, location, location. It’s cliche, but it can’t be understated. You can have that perfect dream home everyone wants but if it’s situated “perfectly” where no one wants it, that makes things difficult. Obviously, location is important and aside from the outside factors like “walkability,” crime rate, and school districts, an even more obvious and important reason is because it’s immobile. It is where it is and it’s limited.
When you are ready to sell and you are looking at what you think you can get there are many tools and resources that you can consult. Online automated evaluation systems are great tools. They are everywhere and can give you a great idea of what taxes were paid on the property in the past and what the purchase price was the last time it was on the market. The automated systems, however, can’t decipher the market like a professional.
Whether you hire an appraiser or a real estate agent, hiring a professional is the best way to determine the TRUE value of your property. An appraiser will take in all the facts and measurements, the value of the area or street the home is on and then give you the value of your property based on comparable homes that have sold in the past six months. The real estate agent will take all of the same information into account and compare it to what is currently active, under contract, and what has recently sold versus the amount of buyers and ready home inventory to assess what you could possibly receive for your home.
Hiring a professional isn’t just to find a price, it’s to set a price. If you have an odd floor plan or have already moved your belongings out and even you can’t imagine how to furnish it, then it will definitely be harder for the buyer to imagine it. Leaving some furniture in strategic areas or hiring a staging or design team can make the difference between a house sitting on the market for days or weeks. If the home looks like a million bucks then maybe you set the price just a tad higher. Professionally staged homes tend to sell 17% quicker, according to the National Realtor Association. The buyer of course is going to have the numbers in their head, “how many bedrooms, bathrooms, etc.” but the majority of the time when it comes down to the final decision, it’s all emotions. You and your professional team need to grab hold of the buyer’s emotions and help them imagine living the next stage of their life in your home.
One of the biggest growing trends in the past decade is the tiny house trend that is that has caught hold across the U.S. today, but has it caught in Utah? You can see it in nearly every home-related television show now-a-days, but what exactly is a “tiny home” and the lifestyle that comes with it? A Tiny home is defined as 100 to 400 square feet. Downsizing and living sparsely obviously come with the smaller space, but nicely enough it comes with a smaller price tag. One of the greatest appeals to tiny living is the lure of living debt free and still owning a place to call home.
“Debt free” has more than a nice ring to it; it’s got a near mesmerizing chime. But living tiny is just as it sounds, hard. Know the challenges that come with tiny. It’s not just the fact that you have to try and fit your entire life into 400 or fewer square feet. Its where do you plant your tiny roots? Many land parcels and subdivisions won’t allow for homes to be built less than 1000 square feet or park RVs fulltime (which the mobile tiny homes usually get referred to as). Do you have a foundation or wheels, or even how do the utilities work? These and many other things can be eccentric or just downright tricky, but the benefits are definitely there. According to thetinylife.com 68% of tiny homeowners don’t have a mortgage to pay every month, while 55% have more savings in the bank than the average American, and 89% of the tiny life community has less credit card debt than the average American. Tiny house living isn’t for everyone though.
Being sold direct from the builder and riding the gray area of zoning laws leaves tiny home finding their plots in more rural communities instead of the urban scene. In general, tiny housing is a lifestyle born out of necessity; a necessity that Utah doesn’t have. We are very much still growing. In 2016 Wasatch Front was recognized, by the National Association of Realtors, as home to more mansions than any other U.S. city. In 2017 Utah has been repeatedly been chosen among the top markets in the U.S. in Forbes, Realtor, Tiny housing may catch along the Front soon, so don’t fret, but for now the tradition of larger families and backyard basketball courts keeps Utah housing on the larger end of the scale.
If you would like to learn more about tiny living in your community or just want to explore your options reach out to us here.
For the first time in 15 yearswe had a buyer change their mind at the closing table. Our client, the seller, had already closed on his new home and the sale of his current home. We have been in the business long enough to see a lot of crazy things, but this perhaps is the strangest. The property passed inspection, appraisal, and financing, yet the buyer got cold feet on the day of closing and didn’t sign the paperwork waiting for her at the title company. As much as we all tried to persuade her to changing her mind, she was out.
This leaves us with a couple of interesting problems that we now have to deal with. First our client will not be able to buy his new home. This is a devastating blow for many reasons. Not only does he lose the home he fell in love with, but he is also out the money he spent for the inspection and appraisal. We made our offer subject to the sale of his home, so at least the earnest money he put down is safe. The biggest problem that we are going to have is finding him a new home in this crazy market.
In this market buyers are being faced with competing with multiple offers on the same property. It can be very exciting as a seller to see all the demand for your home, but in reality, it doesn’t always work out to their advantage.
Let me explain how things are going down:
A seller receives multiple offers – They look them over and pick the best one. Most of these buyers have unsuccessfully written offers on other homes and have lost out. These buyers end up offering the asking price or above. The idea of getting a, “deal” isn’t a possibility in todays market.
Second best gets a chance – The buyer that had the 2nd best offer gets their offer placed in a backup position. If the first buyer backs out, they are automatically given the option to become the primary offer.
Everybody starts the search again – All the other buyers including the backup move on to find another home. Keep in mind, they are all looking for the same thing, so it isn’t unreasonable to assume that they will be competing on their next house with many of the same people.
Here comes buyers remorse – Buyers are all feeling like they might have over paid for their home. They had to offer thousands over the asking price to, “win” the home and the excitement of their home begins to sour.
The domino effect – The primary buyer backs out and the backup offer is notified. What could be simple isn’t. The backup offer has moved on and found another home. So the listing agent moves down the list notifying all the offers the deal has failed.
Bad or worse choice – The only buyers that are left that haven’t found a house are the ones who aren’t making the over asking offers or that have less desirable financing. The seller now has to work with these buyers or put the home back on the market.
Sell, buy, repeat – All is not lost, eventually everything works out. Sometimes, it even works on the first try. If you understand the game in the beginning, you can survive the craziness.
Buying or selling a home in this market can be a serious challenge. We have been doing this for a long time and know that what we are seeing now is a condition of inventory and not the housing market in general. The solution to the problem will be more sellers deciding to sell their home. As we alway say, “when the spring flowers come out, so do the listings”. Time will tell when this market will go back to a normal state. In the meantime, we are going to keep writing offers!
Want to know how our clients win more offers? I made a quick 1 minute video a while back explaining how. Check it out below. The home that fell out, here it is again… Luxury-Location-Affordablilty