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June
1

You've been dreaming of homeownership, have spent years preparing financially, and spent months searching for the perfect home. You finally found it, negotiated a price, and signed a purchase and sale agreement with the seller. Now, the seller wants to call things off—years of dreaming, months of planning, and piles of paperwork, all for nothing.

It doesn't often happen; however, it can be heartbreaking when it does! Why would a real estate seller have a sudden change of mind, and do you have any legal recourse?

In this post, we'll examine some of the reasons a seller might back out of a Purchase and Sale Agreement, the impact of a seller backing out of the deal, and what recourse you might have.

First, Take a Breath and Consider the Situation

Before you run out and lawyer up, take a breath and consider the situation on a human level. If your finances are in order, you've been upfront and interested in moving forward emotions, or a situational change may be behind the seller's change of heart.

Try to determine the seller's reason for putting their home on the market. For example, if the sellers were planning to move into a senior facility because one of them was seriously ill. But they made a miraculous recovery; there is little you can say to convince them to sell.

However, sometimes the seller just doesn't trust you to make good on the deal and has second thoughts. Maybe they have a reason to believe you can't make the down payment or get a mortgage approval, and they don't want to take their home off a hot market for long enough to find out. In this case, sit down and provide whatever evidence you need to allay their fears.

Another common situation is that the home is historically or personally significant emotionally (maybe it has been in the family for generations). The seller is concerned that you properly care for the home. Sit down with the seller and explain that you will honor the home's historical significance. Explain your plan to enhance the historical significance of the dwelling.

Sometimes, the seller got a better offer and decided they'd rather sell to that person. Yes, it's unethical, but it happens. Your legal solutions depend on where you are in the process.

Six Ways A Seller Can Walk Away From A P&S Agreement

If you have a verbal agreement, or the details in the purchase and sale are not met, a seller can walk away at any point. The P&S has legal value and backing out can be complicated. It's something most sellers and buyers want to avoid. Here are six examples of when a seller can walk away before closing:

  1. The contract has not been signed.
  2. A Standard contract provides for a 5-day attorney review period which provides a window for the seller, or buyer, to cancel.
  3. The seller has planted a contingency in the P&S, like a clause stipulating that they must find a replacement home before moving out.
  4. If the buyer doesn't stick to the terms of the agreement.
  5. If a buyer pushes the seller to do repair work that he is unwilling to do.
  6. Any unfortunate incident which turns their life around – like a seller getting sick.

If the deal is not finalized, it's easy for either party to back out. However, once a purchase and sale agreement are signed, backing out can have consequences for the seller.

The Consequences of Backing Out of a Signed Purchase and Sale

There are affects a seller faces when they back out without cause. They open themselves up to both legal and financial consequences.

A seller is subject to legal consequences if they back out of a deal after both parties sign a contract. The ball is in the buyer's court. They have a choice. They can sue to move forward with the transaction or withdraw their offer. Agents may also sue for breach of contract as they are at financial risk of losing their commission.

As a buyer, you have the option of suing for breach of contract. Judges often order the seller to sign over the deed and complete the sale. You can also sue for damages, but most buyers choose to sue for the property.

The seller is also subject to some serious financial consequences. The judge may allow the seller to keep the property, however, the seller will need to adjust the expenses incurred by the buyer during the entire period of house showing and legal work. They must also return any security deposit. The seller often also must pay the buyer's legal fees, along with their own, which could be a harsh penalty.

Create A Comprehensive Purchase and Sale Agreement

The purchase and sale is the contract that bears the details. A well-written purchase and sale contain clauses in clear language as to when a buyer or seller can back out of a sale without legal consequences.

One of the most frequently asked questions is if a seller can back out should they get a better offer from another potential buyer. A purchase and sale agreement protects you. Once an offer has been accepted and a contract signed, a seller can no longer accept another offer. That being said, it could happen, but the truth is that buyers often have more to lose, along with disappointment if a sale falls short because of a seller.

The purchase and sale agreement provides protection to both parties. Few legal options can provide an escape without penalties both legal and financial. A well-written and negotiated purchase and sale can certainly reduce the chances to back out of an agreement.

November
1

Real Estate Myths

If you're planning to buy or sell a home, then you should be prepared to receive loads of advice from family, friends, and neighbors. When it comes to real estate transactions, everyone has their own unique perspective. While advice can be helpful and well-intentioned, it's important to weigh the advice based on experience. The average person is involved in a real estate transaction once every 5 to 7 years while the average Masiello agent manages 11 transactions every year. These uneven experiences have given rise to numerous industry myths.

Click Here to Read More...

November
10

What Is A Section 1031 Exchange, And How Does It Affect Tax Liabilities

Real estate has always been a great way to build wealth. When you buy a property by putting a relatively small amount of money down and obtaining a mortgage, you're leveraging your investment; in other words, you're getting an asset worth significantly more than the money you've invested as a down payment. 

If your home increases in value, you build equity based on the total price of the asset. Another significant benefit of real estate is the tax breaks. When you live in the home, the interest you pay on your mortgage is tax-deductible if you itemize your return. Thanks to the Taxpayer Relief Act of 1997, another tax break comes in reduced capital gains taxes. For example, when you sell your home, the first $250,000 gains are free from capital gains taxes ($500,000 for married couples). These tax advantages make owning a home a wise investment for many of us and allow us to build wealth relatively tax-free when investing in a residence.

If you're a commercial real estate investor, there is another rule you can also use to defer capital gains on your investment property to build wealth. It's called the 1031 Exchange Rule, and it has many moving parts. Real estate investors must understand the law before attempting to use it, and it can be complicated to follow. An exchange can only be made with like-kind properties. In addition, there are tax implications and time frames that must be strictly followed, or it may be problematic. 

If you're considering using a 1031 Exchange or want to learn more, we're going to help you gain an understanding of this investment benefit in this post.

What Exactly is a Section 1031 Exchange

In simple terms, a 1031 exchange (also known as a like-kind exchange) is a swap of one investment property for another. Although most swaps are taxable as sales, if you meet the requirements of 1031, you'll pay no tax or a limited tax due at the time of the exchange.

In effect, you are changing the "form" of your investment in the eyes of the IRS without cashing out or recognizing a capital gain. This allows you to grow your investment tax-deferred. Because there are no limits as to how many times or how frequently you can use 1031, you can continue to roll your capital gains from one investment property to another, and another, and another.

Even though you may be profiting from each swap, you avoid paying any taxes until you finally cash out many years (or even decades) later. If it works as planned, you'll pay a single tax at the current long-term capital gains rate (currently 15 or 20% depending on your income).

Most exchanges must meet the criteria known as "like-kind." However, this phrase doesn't necessarily mean what the name implies. For example, you can exchange an apartment building for raw land or a ranch for a strip mall. The rules are surprisingly liberal. You can also exchange one business for another. However, there are "traps" of which you need to be aware.

The 1031 rules are for investment and business property, although they can apply for a former primary residence under certain conditions. It's also possible to use the 1031 Exchange for swapping a vacation home, but this loophole has been made much narrower in recent years.

When You Might Want a 1031 Exchange

As a real estate investor, there are several reasons that you may consider using a 1031 exchange. These include:

  • You're looking for a property with better prospects for an ROI, or you might want to diversify your assets.
  • If you own investment real estate, you might be looking for a managed property rather than managing it yourself.
  • You may want to consolidate your holding for estate planning purposes, for example, dividing a single property into several assets.
  • To reset the depreciation clock (more below.)

The main benefit of a 1031 exchange over simply selling one property and buying another is the tax deferral. By deferring capital gains taxes using a 1031 exchange, you're freeing more capital for investment in a replacement property.

Bear in mind that 1031 might require a higher minimum investment and a longer holding time. 1031exchange transactions can be complex and should be handled by professionals.

Understanding Depreciation and Why It's Important

It's essential to understand the concept of depreciation to gain a proper understanding of the benefits of a 1031 exchange.

Depreciation is the percentage of the cost of an investment property written off every year, recognizing the effects of wear and tear. When you sell a property, capital gains taxes are calculated based on the property's net-adjusted basis, which combines the property's original purchase price plus capital improvements, minus depreciation. 

If your property sells for more than its depreciated value, you may need to "recapture" the depreciation. That means the amount of depreciation is included as taxable income when you sell.

Since the size of depreciation increases with time, you might want to consider a 1031 exchange to avoid the significant increase in taxable income that recapture would cause. Depreciation recapture is a factor to account for when considering a 1031 exchange.

The Replacement Property: Timing and Rules

The classic exchange involves a simple swap of one property for another between two people. However, it's long odds to find someone with the exact property you want, who wants the exact property you have. As a result, the majority of exchanges are delayed, three-party exchanges.

In a delayed exchange, you need a qualified intermediary or middleman. He or she will hold the cash after you sell your property and then uses it to purchase the replacement property for you. This is a three-party exchange that is classified and treated as a swap. Here are two essential timing rules you need to follow in a delayed exchange.

The 45-day Rule

This rule relates to the designation of a replacement property. Once a sale occurs, the intermediary receives the cash. Within 45 days of the sale, you must designate the replacement property in writing to the intermediary, specifying the property you wish to acquire. The IRS rule states that you can select three properties as long as you eventually close on one of them. 

The 180-day Rule

The second timing rule you need to be aware of in a delayed exchange relates to closing the replacement property. You must close on the new property within 180 days of the sale of your original property.

One crucial fact to be aware of is that these periods run concurrently. That means the clock starts when you close on the sale of your original property. For example, if you designate a replacement property exactly 45 days after you close, you'll have just 135 days left to close on the replacement.

Tax Implications

While there are plenty of benefits to 1031 exchanges, it's essential to understand potential pitfalls if the transaction isn't handled correctly. For example, you may have cash left over after your intermediary acquires the replacement property. If so, they will pay it to you at the end of the 180 days. This cash is known as "boot," will be taxed as the partial sales proceeds from the sale of your property, typically as a capital gain. 

One way people can get into trouble with this type of transaction is by failing to consider loans. You must consider any mortgage loans or other debts on the replacement property. If you don't receive cash back, but your liability is reduced, that is treated as income to you – just like cash. 

For example, if you were carrying a mortgage of $1 million on your old property, but the mortgage on the replacement property you receive in the exchange is only $900,000, you will have a $100,000 gain. This is classified as "boot," and it will be taxed.

The Bottom Line...

While we've just touched on the highlights of 1031 exchanges, the fact is, 1031 is an intelligent tax-deferral strategy that real estate investors can use to build real wealth. The bottom line is that while using a 1031exchange strategy is a savvy business move, there are many complex moving parts that not only require you to understand the rules. It is important to enlist professional help, even if you're a seasoned real estate investor. 

October
20

Learn the Pros and Cons of a Rent-Back Agreement When Selling or Buying a New Home

If you're buying a new home while selling your current one, it's a good idea to get familiar with something called a rent-back agreement. Timing-wise it can require some good luck to get it right if your home sells before you've closed on your new one or even found a place. Without a rent-back agreement, your choices are couch-surfing or paying to stay in a hotel. Either way, you'll have to move twice... and no one wants to do that!

A rent-back agreement gives you, as the seller, a third choice. With a signed rent-back agreement, you will have extra time to live in the home after closing. It essentially gives you the right to become the new buyer's temporary tenants. Most don't last long – there are typically time limits built into the agreement – but it gives sellers a chance to close on their new home, pack up, and arrange for the big move.

For the buyer, offering a rent-back agreement can also provide a couple of serious benefits. For example, in a competitive market, an offer that's flexible on move-out dates can give you, as the buyer, an edge. Plus, the rent the seller will pay can help you recoup those hefty closing costs. 

When it's done right, a rent-back agreement can be a win-win for everyone.That being said, there are a few considerations before you jump in the pool!

What Exactly is a Rent-Back Agreement?

A rent-back agreement is a legally binding agreement made in writing between the seller and the buyer with terms much like a leasing agreement between a landlord and a tenant. However, some issues can get a little tricky, so it's crucial to understand how one works.

Essentially, the seller becomes a tenant in their old home, and the buyer becomes a landlord for the home they are about to possess, possibly with no experience.

The typical rent-back agreement covers the basics in a few areas:

• Terms and Possession

Before closing, all of the details of a rent-back agreement need to be worked out, including how the rent will be paid, what it will cost, and when the seller/tenant will move out. As a buyer, you just can't assume that the seller will agree to anything or behave as you expect just because you bought their home. The rent-back agreement needs to be written up with the same care as the purchase contract. While it is not common, you should make sure you understand the eviction laws where you purchased, just in case the seller decides they're going to stay as long as they can.

• Rent, Security Deposit, and Late Fees

Like any rental agreement, the buyer/landlord can collect a refundable security deposit. Both buyer and seller need to agree to fair market rent. At closing, the buyer pays closing costs, and the seller pays a security deposit and upfront rent. After the close, the buyer gets the keys, and the seller stays in the home. 

• Utilities

The agreement needs to specify which party is responsible for utilities. Usually, sellers will have the utilities switched to the new buyer at the close. However, in a rent-back agreement, it may be in the buyer's best interest to have the seller keep the utilities in their name and continue to pay them.

• Entry Rights

Make sure to cover the right to enter is in the rent-back agreement. If the buyer wants to begin painting or making any changes to the home while the seller is still living there, they will need to give proper notice, typically 24-hours, before entering the home.

• Maintenance

The agreement should also cove who is responsible for maintaining the interior and exterior of the home. Maybe the seller will continue doing the yard work, but if the stove or refrigerator stops working, the seller will call the landlord to get a new one. Specify maintenance to make sure there is an understanding for handling any unforeseen circumstances.

• Insurance

The new owner will have to have insurance coverage as per the lender's requirement – and because they are the new owner. However, the owner's insurance won't cover the tenant's possessions, so your agreement will need to include terms for the tenant to carry renter's insurance. As the buyer, include the right to ask for proof of insurance.

• Inspections

The new owner should walk through the property before the close to note its condition. Take photos to document. Do another walk-through upon taking possession at the end of the seller's rental term to determine any damages that may require compensation which can be taken from the security deposit.

The Pros and Cons of a Rent-Back Agreement

There are positives and negatives both for the buyer and the seller with a rent-back agreement. Here are a few to consider:

For the Seller:

A seller might want to consider a rent-back agreement if there is a significant gap between closing on the sale of their home and the purchase of their new home. In a tight market, getting some additional time to find your dream home can be a lifesaver. While a rent-back agreement is typically short-term – 30 to 60 days, that extra time can often make a big difference. On the downside, while you're still in the property, you need to remember that it isn't yours anymore. Technically, you now have a landlord. That means if you cause any damages, are late with the rent, or vacating the property, you may be liable and held financially responsible. 

For the Buyer:

If you're not in a hurry to move in, a rent-back agreement can be a factor in landing you your dream home. It is a way to make your offer stronger and stand out to the seller. However, there are some factors to consider since you are now technically a landlord. This means that you may be responsible for any repairs, for example, replacing a broken water heater or fixing a broken stove. And you may need to make the repairs immediately. You also need to be concerned that the sellers will move out on time. They rarely drag their feet, but it does happen. If it does, you may need to go through the legal process of having them evicted.

The Bottom Line...

All that being said, when properly and thoughtfully executed, a rent-back agreement can be a win-win situation for both the buyer and seller. Your REALTOR® and attorney can help guide you to create a proper rent-back agreement that is fair and beneficial to both parties. Just make cover all the bases and make sure that the terms of the agreement are very specifically spelled out. 

If you treat this situation like you would any other business relationship you should be ok. Buyers should never let sellers retain possession of the home without a formal occupancy agreement. A well-written agreement will protect both the buyer and the seller. 

October
6

Considering Aging in Place? Look for Communities that offer Amenities to Make it Easier!

Baby boomers have always been an independent, active generation. As they begin to enter retirement, many are planning on aging in place. Aging in place is a growing trend. The phrase refers to people living in their current home as they age and continuing to live there until they are no longer able.

It is basically the opposite of moving to a retirement community.

The main prerequisite for aging in place is retrofitting your home to make it more amenable and easier to live in as you age. If you are planning on staying in your home as you age, you will need to make accommodations for future issues that may arise, like arthritis, knee problems, or the need to use a walker or wheelchair to get around.

But it also helps if the community you live in offers accomodating amenities and services geared toward older residents. Some cities are better than others. Many are not as accommodating as they would like to be given the increasing numbers of boomers reaching retirement age. 

The good news is that developers are building planned communities that feature amenities accomodating to older homeowners. In addition, many cities are taking stock of what their communities have to offer senior residents. They are making adjustments to accommodate older citizens, as they begin to realize that boomers are making decisions about where to spend their post-retirement years.

Here are seven aging-in-place features to look out for in any prospective community to make your post-retirement more enjoyable.

1. Accessible, Visitable, and Affordable Housing

A feature homeowners seeking to age in place are looking for is one-floor living. The best aging in place communities have plenty of one-floor living housing options. These communities also have good local remodelers who know how to adapt existing housing stock to make it more livable for older residents. 

To attract seniors, communities are changing their zoning laws to allow for rental units or affordable housing. Some have instituted tax breaks available for residents over 65 based on income.

2. Readily Available Safe Transportation Options 

Communities that offer reliable mass transit and senior transport programs are also high on many senior's wish lists. Walkable neighborhoods that are safe for pedestrians and adequately lighted are also essential. It is also crucial that roads are as safe as possible, with clear visible signage, making it easy for older drivers to navigate. 

3. Safe Neighborhoods

Along with traditional methods for crime control, successful aging in place communities also incorporates "friendly call" programs geared toward older residents who live alone. People volunteer to call older residents every morning at a pre-arranged time.

4. Quality, Accessible Health Care

Communities that have adequate numbers of primary care physicians, specialists, and hospital facilities get high marks with older residents. A retiree-friendly community will also offer preventable health care activities at local senior centers, along with exercise programs for older residents.

5. Access to Support Services

Home and community-based caregiving support services become very important to seniors, whether it's the availability of home health care, adult daycare, or meals on wheels. For example, one such program is called the Caring Collaborative and has chapters in New York, Long Island, and San Francisco. These are essentially chapters that connect people in need with those who can help. 

6. Walkability and Access to Nearby Goods, Services, and Amenities

High marks in this category mean that a community has retail outlets, restaurants, and grocery stores offering healthy foods within walking distance. Policies that support local farms, and farmer's markets are also a big plus.

Having these types of amenities woven into a community is extremely attractive to older residents. Mixed-use downtown areas appeal to older residents and are luring some affluent retirees to give up homes in the suburbs for apartments or condos in central business districts.

7. Opportunities to Socialize

Staying social is crucial to good mental and physical health as we age. Communities that offer places of worship, libraries, museums, universities, and colleges provide outlets for residents to stay social. But they need to be easily accessible as well. 

Opportunities to volunteer as we age are also important. As you get older and work responsibilities diminish, many seniors find happiness in helping others and giving back.

Adapting Your Home For Aging in Place is Only One Element!

Having wider doorways, threshold-free showers and one-story living are all important elements if you are considering aging in place. Preparing your home for safely aging in place can start well before retirement age. As you remodel and renovate, work with your contractor to incorporate universal design elements into your home renovations. Even if you choose to move, having a home that is ready for older homebuyers can add value and increase demand.

Today, seniors are more active than previous generations and looking for more from their communities. If you are planning on aging in place, look around your community for these seven features. As more people reach retirement age, many cities and towns are beginning to adapt to this growing demographic.

If you're in the market for an aging-in-place, forever home, begin by identifying your needs now and into the future. Then explore your community to see what it offers aging residents.

September
15

Winning a Bidding War and Buying A Home

Before the pandemic, the population growth of many cities in the U.S. with over 1 million people was stagnant or declining. As the pandemic peaked, smaller communities began to experience a growth surge as people, newly working from home, realized that they could live anywhere and chose to relocate away from cities.

As urban populations disperse, smaller metropolitan areas, suburban counties, and rural areas have experienced unprecedented demand for housing. This has caused many markets to heat up and become hyper-competitive. 

In a market where supply is low, and demand is high, it's not uncommon to find yourself in a bidding war as multiple offers push prices higher and higher. Add low mortgage rates to the mix, and you may find yourself edged out of the running several times when trying to buy a home!

While no single strategy can guarantee that you'll win a bidding war, there are several steps you can take to make your offer stronger when buying a home and put you in the best position to compete and prevail!

Prepare For War!

When you're competing in a hot housing market like we're experiencing today, most agents agree that it's best to push aside your emotions, regardless of how difficult that might be. After all, much of the home buying process relies on making an emotional connection with a home. However, to succeed in a bidding war, you need to begin your home search with a fully stocked arsenal!

That means, having your finances in order, thoroughly researching potential target neighborhoods, and building a team of trusted experienced professionals well before you need to move a deal along. This team should include everyone from your banker, to your broker, lawyer, and engineer, as well as a contractor.

Getting your finances in order means deciding the maximum comfortable number you're willing to pay for a home, which doesn't necessarily mean what the bank will approve you for.

Along with all of this, you also need to bring a willingness to compromise to the bargaining table. Right now, it's a strong seller's market. Sellers have the option of asking for the world, and more often than not, they're getting whatever they ask for!

Here are some tips for coming out ahead when buying a home in a bidding war.

• Get A Pre-approval Letter

This is one of the first and most important steps of the entire process! A mortgage pre-approval letter shows a seller that you've done your homework, and you're not only a serious buyer, you're also a qualified one. This is an especially effective tactic should you enter a bidding war.

It's important to understand that a pre-approval letter is different than a mortgage prequalification. To get a preapproval letter, your lender evaluates every financial detail, including your credit score and report, then decides whether they will loan you the money to buy a house, and the amount they will loan. Pre-approval is based on documentation which includes W-2 tax forms and bank statements.

• Make an All Cash Offer, or A Larger Downpayment

Sometimes the highest bid does not win. Sometimes money talks when bidding on a house. Paying cash is often much more appealing to a seller because it virtually eliminates the possibility that financing will fall through before closing. Cash deals also typically close faster. Offering a substantial down payment or making a cash offer often go right to the front of the line in a bidding war. 

Can't pay cash? Your earnest money deposit can show a seller that you are a serious buyer. The typical earnest money deposit is 1 to 2% of the purchase price, but this varies by location. A higher earnest money deposit can catch a seller's attention and signal that you're serious, especially in a hot housing market.

• Include an Escalation Clause in Your Offer

Including an escalation clause can work to strengthen your offer. if other offers come in that match or beat your initial bid, an escalation clause states that you are willing to incrementally increase your offer up to a fixed limit 

For example, say the asking price is $200,000. Your REALTOR® would prepare your office to state:

My initial bid is $200,000 with an escalation of $2000 over any and all competing offers with a cap at $210,000. However, if another bidder offers more than $210,000 you'd be out of the running.

• Limit Contingencies

Contingencies allow buyers to walk away from a deal without losing their earnest money if certain conditions are not met. In a bidding war, you want to carefully choose them. 

Try to submit a clean offer without too many contingencies. To be competitive today, you need to do your homework. Know you can obtain financing so you can eliminate a credit review contingency. Understand what to look for when walking through the home before submitting an offer to forego the inspection. Agree to pay a certain amount over the list price, and know you can afford that over the appraised value.

• Be Flexible on the Closing Date

This can be an effective tactic in a couple of ways. For example, let's say you get outbid by a few thousand dollars, but you're willing to give the seller more time to move out. That flexibility can often make you the frontrunner in a bidding war. 

Extra closing time might be attractive to a seller who might otherwise have to spend more on moving or storage. Especially if they're crunched for time to find another home in a tight market. Sometimes you can win the bidding war by extending the closing date. For example, if the sellers are in a crunch, offer to rent the home back to them cheaply, for a fixed period. If the home is already vacant, you can sometimes win by offering to close quicker, reducing the seller's expenses of carrying two mortgages. 

Even If You Lose the Battle, You Still Could Win The Bidding War!

One final thing to keep in mind...

Just because another buyer was chosen over you doesn't necessarily mean you've lost the war. When buying a home, transactions can often fall through for any number of reasons. If you make a well-thought-out offer, a strong enough bid, and are ready to act quickly, you might be next on the seller's list!

If you're serious about winning a bidding war, work with a seasoned real estate professional with experience in this type of market. A real estate agent or REALTOR® will have the skills to help you prevail in a bidding war. They will also have extensive market knowledge, which is critical for determining the fair market value of any home you're interested in. 

August
2

New England Vacation Home

If you love to travel, you've probably vacationed in some spectacular places that hold special memories. Perhaps the ocean views, exotic cuisine, relaxing atmosphere, or abundance of nature make you want to return again and again to this special place.

Click Here to Read More...

July
14

Learn About the Multiple Listing Service And What It Does

When it comes to real estate, everyone involved is working toward a common goal: putting the keys in the hands of the new owner. Every buyer wants to find their dream home, every seller wants their home to go to the perfect buyer, and every real estate agent wants what is best for their client. And that is what the multiple listing service is designed for!

If you have ever been involved in a real estate transaction, then you are probably familiar with the multiple listing service. The multiple listing service is a technology that is in place to help make real estate transactions more efficient. In fact, 64% of National Association of Realtors members have said the MLS is the most valuable technology they use in their business.

Buyers and sellers should both have a good understanding of the MLS and why it is valuable. Through the multiple listing service, brokers can more easily connect buyers sellers for mutual benefit. 

In this post, we will examine the history of the multiple listing service, what it is and what it does!

First, A Little MLS History

In the late 1800s, real estate brokers would regularly gather together at the offices of their local associations to share information on the properties they were trying to sell. They agreed to pay the other association members who helped them sell their properties, and the original Multiple Listing Service was born. It was based on a principle that is unique to real estate... "help me sell my inventory, and I'll help you sell yours."

Today, there are more than 800 MLSs where brokers share information on their properties and invite other brokers to cooperate in the sale in exchange for a commission if they produce a buyer. Sellers benefit by gaining widespread exposure for their property. Buyers benefit because they can obtain information about all the properties listed on the MLS while working with only one broker.

What is the Multiple Listing Service?

According to the National Association of Realtors (NAR), the MLS is a private database created and maintained by real estate professionals (agents, brokers, etc) to help clients buy and sell a property. 

The MLS is a tool to help listing brokers find cooperative brokers working with buyers to help sell their client's homes. The MLS is a powerful force for promoting competition. MLSs level the playing field so the smallest brokerage can compete equally with the largest multi-state firm. Buyers and sellers can work with the real estate professional of their choosing, confident that they have access to the largest pool of properties for sale in the marketplace. 

In most cases, MLS listing information is provided to the public free of charge by participating brokers.

How it Works

Today, most of the MLS process takes place online. The database provides information on properties for sale and includes pictures and detailed descriptions along with documents like seller disclosures. The MLS is updated throughout the day, so brokers can find homes their clients will love almost immediately. 

The MLS provides buyers with more homes to choose from and helps sellers get their listings in front of a bigger pool of buyers. Today there are multiple regional MLS networks. Each network must follow the regulations set by the NAR and can only be accessed by licensed real estate professionals who pay a membership fee. 

This means that sellers cannot list their homes on the MLS on their own, and buyers cannot search the database. The seller's agent can list their homes on the MLS, and buyer's agents can search the database to find potential homes that meet homebuyer's needs. Both buyer and seller's agents use the MLS to prepare comparative market analyses. 

Every listing on the MLS is different. The information it contains depends on what the listing agent chooses to include. The most common information most listings include is:

  • The age of the home
  • The size of the home
  • The number of bedrooms and bathrooms
  • Any unique features 
  • Interior and Exterior pictures

While listings may also be available on other online real estate sites, the MLS includes additional information that is not always available to the public on those sites.

The Benefits of the Multiple Listing Service

The MLS benefits everyone involved in a real estate transaction – buyers, sellers, and real estate professionals. As previously mentioned, it can level the playing field by allowing small firms to compete with larger firms. The MLS helps real estate agents provide the best experience for their clients. Whether that is helping a buyer find the right house or helping a seller market their home. 

With the help of their agent, buyers can find the home that best meets their needs. They can also find additional options they may not have considered. The MLS gives agents access to homes almost immediately when they are listed, allowing them to beat other potential buyers to the property. 

The widespread sharing of information helps to simplify the selling process for homeowners. The MLS can increase your property's visibility getting it in front of more potential homebuyers. For both buyers and sellers, the MLS helps you understand market dynamics and can help with pricing a home strategically by providing in-depth information on the local market. 

The Bottom Line...

The MLS can help all parties in a transaction by providing valuable information on the homes for sale in your local market, and getting them more exposure. However, it is crucial to understand that it is only accessible to real estate professionals. If you work with an agent, they can provide you with access and help you to search the database and compile a list of homes that check off your boxes. 

The Multiple Listing Service provides valuable information that can help move buyers, sellers forward.Educating yourself on the process of home buying, and home selling can also help with any transaction. Understanding the multiple listing service and how it works help make it easier to navigate your local real estate market.

https://www.homelight.com/blog/buyer-what-is-the-mls-multiple-listing-service/

https://www.nar.realtor/nar-doj-settlement/multiple-listing-service-mls-what-is-it

https://www.rockethomes.com/blog/home-buying/multiple-listing-service

July
7

Seven Reasons The Highest Offer Doesn't Get You The Home

Part Three of Our Three-Part Series On Making an Offer When Buying A Home

The real estate market in many locations has simply been on fire! Today, here in New England and many other areas, homes that typically attract little interest are garnering multiple offers, and bidding wars are common. 

Conventional wisdom says that when it comes to real estate, the highest offer gets the house. But the truth is, this is not always the case. Sure, a solid offer is the first thing that every seller wants to see, but an astute real estate agent or REALTOR® will advise a seller that each offer is more than just a number it is actually the sum of all its parts.

Here are seven reasons why your artfully crafted lower real estate offer might just help you beat the higher bidder after all!

1. When it Comes to Real Estate, Cash is King!

If you can afford to pay cash, you just might beat a higher bidder. It might sound impossible to pay cash for your home, but many people do it. According to the National Association of Realtors, 12% of all houses sold in 2019 were all-cash deals. 

An all-cash offer is attractive to a seller of real estate for several reasons. First, there are no mortgages or lenders involved, no appraisal to worry about, and escrow can close faster. 

2. Don't Have 100% Cash? A Preapproval Letter is the Next Best Thing

Pre-approval is much different than pre-qualification. A pre-approval letter is a confirmation from a lender that confirms you are ready to buy in a set price range and you have been pre-approved for the loan.

In essence, the real estate pre-approval lender turns you into a virtual cash buyer. Other buyers could offer more, but if they are not pre-approved, the deal could fall through. As a result, a pre-approval letter gives you a leg up, even with a lower offer.

3. Your Timeline is Flexible

Typically, the closing period can last anywhere from 30 to 90 days. Offering to customize closing to meet the seller's needs can sometimes seal the deal over a higher bidder. Sellers almost always want a fast close. If you have all your paperwork together you might be able to get it done! Be flexible! Sometimes the seller might need more time, for example, if the house they are moving into will not be ready for 60 days. Find out what works for the seller and accommodate their needs. Sometimes the lower offer does win.

 4. The "We Love Your House, Please Let Us Buy It" Letter

 It might seem cheesy, but much of the home buying process is emotionally based. Sometimes sending the seller a heartfelt letter letting them know you   love their house and hope to raise your family in the home can sometimes make the difference!

 5. Keep the Contingencies and Concessions to a Minimum

 Contingencies are typically negotiating tools that allow you to walk away from a deal without consequences. The three most common are inspection,   financing, and appraisal contingencies. Every contingency you add can make your offer appear weaker because each can make the deal more difficult to   close. Make sure you really need each contingency before building them into your offer. 

6. Be Careful About Asking for "Extras"

Be careful what you ask for! If you ask for the custom drapes, the appliances, and the chandelier that was a wedding gift from the inlaws, (and was excluded in the listing) you risk offending the seller and having them walk away. Even if yours is the highest bid!

7. Include an Escalation Clause

An escalation clause is an excellent way to make your offer stand out. An escalation clause states that you will pay a pre-determined amount over the highest bona fide offer that does not contain a home sale contingency. While not all agents use this tactic, it's a great way to stand out in a competitive situation. 

For example, once all of the offers are reviewed, the seller's agent will contact the buyer's agent and forward them the highest offer. The buyer then has a fixed amount of time, for example, 30 minutes, to accept or reject the highest bid and include their escalation amount. So if the offer is $525,000 and the escalation amount is $5000, the buyer must agree to $530,000.

Putting Together Your Real Estate Strategy in a Competitive Market

Sometimes the biggest wallet does not close the real estate deal. These tactics can help you develop a strategy to help make a lower bid more attractive to a seller. The best solution is to work with an experienced real estate agent or REALTOR®. They understand the local market and can help you develop a strategy to compete in a tight marketplace that goes beyond simply making the higher offer.

Remember, every term in a deal is negotiable. In today's market, the seller is in the driver's seat. However, if you understand their needs you can craft a strategy that offers benefits beyond the highest offer. A good seller's agent will compare and leverage all offers to achieve the homeowner's desired pricing and terms. A good buyer's agent will help you craft an offer that benefits you and meets all of the seller's needs. 

https://www.trulia.com/blog/5-reasons-the-highest-offer-wont-always-get-you-the-house/

https://www.realtor.com/advice/buy/reasons-why-your-higher-offer-wont-win-the-house/

http://realestate.boston.com/ask-the-expert/2018/05/10/why-the-highest-offer-isnt-always-the-best-one/

If you missed part one of this three part series on Making an Offer when Buying a Home, here is the link to part one & two:

Part One https://www.masiello.com/news-and-updates/2021/06/16/the-logistics-of-a-seller-backing-out-of-a-purchase-and-sale

Part Two https://www.masiello.com/news-and-updates/2021/06/24/the-pros-and-cons-of-an-all-cash-offer-for-buyers-and-sellers

June
30

Are There Advantages To An All Cash Offer When Buying or Selling Real Estate?

Part Two of our Three-Part Series On Making an Offer When Buying A Home

When it comes to buying a home, an all-cash offer can be a pretty powerful tactic, especially if there are multiple bids on a piece of property. However, making (or accepting) an all-cash offer is not always a no-brainer, either for the buyer... or the seller.

One big difference between an all-cash offer and a financed offer is that the cash offer can close quicker. As a general rule, while an all-cash offer might seem suspicious, if it's from a valid buyer, it is usually easier, with a lot less red tape.

In this post, we'll look at the pros and cons of the all-cash offer from the perspective of the buyer and the seller.

Defining the All Cash Offer

Recent data from the National Association of Realtors for 2019 found that 12% of all buyers purchased their homes with cash. As the name implies, an all-cash offer means that you have the ability and liquid cash available to purchase the house outright. You don't literally pay with a briefcase full of hundreds, but you'll need access to all of the funds in a liquid account that allows immediate withdrawals or transfers. For most people, that means a checking, savings, or money market account.

An all-cash offer means that you will not be getting a mortgage loan for any portion of the sale. This is important to the seller because it eliminates the financing contingency of the purchase agreement. A seller makes their decisions based on the terms of your offer, including contingencies. An all-cash offer also makes several other contingencies optional. That can be a powerful tool when engaged in a bidding war with multiple buyers. These can include:

• The Appraisal Contingency

Lenders require an appraisal, cash buyers do not. If you're confident you're getting a good price, you can waive the appraisal contingency. 

• The Inspection Contingency

As a cash buyer, an inspection contingency is also optional. However, this is one contingency you might want to keep in your agreement.

• The Sales Contingency

A sales contingency means that your current house must sell before you close on the new property. This is pretty much the opposite of liquidity. While you can include this contingency, it diminishes the attractiveness of an all-cash offer.

The bottom line? An all-cash offer means you have liquid funds available, so you will not need a mortgage loan. You may also waive certain contingencies to make your offer even more attractive to the seller.

The Pros and Cons of an All Cash Offer: For The Buyer

An all-cash offer offers homebuyers some significant advantages. Here are some of the pros and cons of an all-cash offer:

The Pros: 

• Limited Contingences

As previously mentioned, one key benefit of making an all-cash offer is the ability to pick and choose which contingencies to include. Not only will this save money, but in a competitive market, this is very desirable to most sellers.

• Less Hassle, Lower Fees

All cash offers are also good for the homebuyer because you do not have the hassle of dealing with a lender. That means no need to gather paperwork like tax returns, income statements, proof of employment, credit scores, or asset lists. You will also save on closing costs associated with getting a mortgage loan.

• Streamlined Closing

As a buyer, an all-cash offer gives you more control over the closing timeline. This means you can close faster because you are not waiting for bank approvals. This can be significant for sellers who need to move quickly.

• Possible Pricing Benefits

As mentioned, sellers are often attracted to an all-cash offer because of fewer contingencies, fewer hassles, and a faster timeline. As a result, you may be able to make a lower offer and have it accepted, even in a multi-offer situation. An all-cash offer can give you leverage to negotiate a better price that can mean savings and increased equity right from closing!

The Cons:

There are some drawbacks to making an all-cash offer. You need to consider all of the positives and negatives before you commit to any deal. Here are some negatives to be aware of.

• Loss of Liquidity

This should be a top consideration before making an all-cash offer. Real estate is a non-liquid asset which means it can be challenging to get cash out when you need it. 

• Loss of Diversification

If you place much of your liquidity into a home purchase, you may lose out on potentially larger gains that could be realized elsewhere. Real estate typically earns around 2 or 3% annually. 

• Tax Implications

If you itemize deductions, mortgage loan interest is tax-deductible on your federal income taxes. Without a mortgage loan, you lose that deduction.

• Less Free Cash for Homeownership

Owning a home requires more money than the purchase price. You still need to budget for closing costs, any renovations, and general maintenance and upkeep. Make sure you have enough money to cover taxes, repairs, and other items.

The Pros and Cons of an All Cash Offer: The Seller

As with buyers, there are pros and cons for sellers when an all-cash offer is made for your property. Several situations encourage an all-cash offer. In recent years a new phenomenon has emerged: direct homebuying online. Companies like Open Door, Redfin, and most recently Zillow are buying homes directly from sellers.

Let's take a look at the pros and cons of an all-cash offer as the seller.

The Pros:

  • It's FAST

The traditional route of using an agent and listing on the MLS, or going "FSBO" offers no guarantee your home will sell. Assuming you've priced it right, it should sell, but it can take months to get the deal you're looking for. Realtor.com data suggests that it takes about 65 days to sell (which can vary widely by location). Once under contract, escrow can last 30 to 60 days, or longer. That being said, if you need money fast, going the traditional route has drawbacks. Online direct homebuying, for example, can get you an offer in a fraction of the time.

• No Repairs

If you're in a hurry or don't have cash on hand, the idea of repairs that might be needed to maximize your home's value may not be doable. Cash sales are typical "as-is." You'll still need to disclose defects, but if your home needs repairs, and you're not in a position to do them, an all-cash offer may be the way to go.

• Fewer Contingencies

This was also a pro for the buyer. A traditional sale often comes with a list of contingencies. If it's a buyer's market (not applicable right now!) your buyer might even request a home sale contingency which can drag out your sale for months.

The Cons:

While it seems like there are a few great benefits of receiving and accepting an all-cash offer, there are a couple of drawbacks to be aware of:

• Less Money / Lower Offers

This is the big one! If you're looking for top dollar for your home, then an all-cash offer will often disappoint. In a seller's market, like today, an all-cash offer is a good tactic for a buyer to win a bidding war if you're selling to an individual who is looking to live in the home. However, investors are buying homes to resell them. They will offer less if they are coming to you with an all-cash offer. If you're selling to a company like Zillow they may offer less and give you great terms like a 10-day close and no contingencies. It depends on your situation as to whether it's a good deal.

• Make Sure The Money is "Real"

If you're dealing with a reputable company like Zillow or Redfin, or a REALTOR® or agent who has vetted their client this isn't a concern. However, if you received a "We Pay Cash" postcard in the mail, make sure they have the cash they're offering. Ask to see a bank statement or "proof of funds" letter. In these types of deals, since all-cash offers often have a short escrow (sometimes as short as 7 to 10 days) you may want to negotiate a lease-back so you don't have to rush into a move. This is a smart tactic. In the event the deal falls apart, you'll have fewer worries.

The Bottom Line On An All Cash Offer

The all-cash offer brings with it both benefits and drawbacks for both buyers making the offer and sellers who accept it. The bottom line is that for buyers, the all-cash offer is an interesting tactic in a hot market that can help make them stand out from among the crowd in the event of multiple offers on a property. There are some considerations including contingencies and closing dates you'll need to think through.

For the seller, the all-cash offer can mean a quick close and fewer hassles, but unless it's a seller's market, it's likely to be below the market value of your home. But it is fast and convenient. In the end, whether you're the buyer or the seller, you need to consider all of your options including which factors are most important to you in your unique situation.

If you missed part one of this three part series on Making an Offer when Buying a Home, here is the link to part one: https://www.masiello.com/news-and-updates/2021/06/16/the-logistics-of-a-seller-backing-out-of-a-purchase-and-sale

June
29

Build or Buy a Home

To build or to buy? It's one of the first and most important questions that you'll need to answer when considering your next home. The right answer for your family depends on a variety of factors, including your budget, where you would like to live, your preferences for the home, and your future plans. Our real estate agents are here to help you make an informed decision, with a closer look at whether building or buying a home might be the right choice for your family.

Click Here to Read More...

June
9

The Pros & Cons Of Waving A Residential Home Inspection

The real estate market is on fire right now! If you're a seller, the good news is houses are coming on the market and receiving multiple cash offers within days of listing. If you're a buyer, chances are you're going to be vying with several other buyers for any home you are interested in.

After months of house hunting, you might not want to let this one getaway. You need an edge. One way to sweeten your offer is to waive the home inspection to expedite the buying process and stand out from the competition. While this tactic could end up with you winning the home, it could also end up costing you big time down the road!

A home is probably the biggest and most important investment you'll make in your lifetime. So it's absolutely crucial to your sanity and your bank account that you do your due diligence and have all of the facts and figures in place before you commit and sign a purchase agreement. Otherwise, instead of your dream home, you could be investing in a money pit!

Of course, some homeowners are ok with taking the risk to get the house they want. In this post, we will take a closer look at what a home inspection is and offer the pros and cons of waiving a home inspection.

What is a Home Inspection?

If you've ever gone through the home buying process, you're probably familiar with a home inspection. Typically, once you've signed a purchase agreement and the home is under contract, you bring in professional, certified home inspectors to perform a visual, in-person inspection. 

This process is done to protect the buyer from any hidden problems. The inspector will walk through the home, inside and outside, and check its condition, the issue a report outlining what they have found. Inspection reports typically include any roof and termite damage, as well as structural issues and systems checks, including electrical, plumbing, and HVAC. In addition, the inspector will also document the home's general interior and exterior features and condition, appliances, sprinkler system, pool, windows, doors, etc.

When the inspection is complete, the inspector sends his findings to the buyer. The buyer uses this information to first decide how to proceed. Depending on the information in the report, the buyer may use it as a negotiating tool to request that the seller pays for certain repairs before closing or reduce the sale price. If the damage is extensive, it provides a legal way to back out of the deal.

For this reason, sellers want the inspection to go as smoothly as possible. If they want to sell quickly, they are often willing to negotiate to make it happen.

Why Buyers Are Willing to Waive the Home Inspection

Right now in New England, we're in the hottest real estate market in DECADES! According to NerdWallet's 2021 Home Buyer Report, nationally, an estimated 28 million Americans are planning on buying a home in the coming year. At the end of 2020, the supply of homes available in the US was just 1.04 million units. According to the National Association of Realtors, this is the lowest number of available units since data collection began in 1982!

With multiple buyers vying for properties and bidding wars becoming the norm, waiving the home inspection can become a compelling offer for a seller. The National Association of Home Builders Housing Trend Report found that being outbid was the most common reason buyers cited for not yet purchasing a home. So it makes sense that an eager buyer would be willing to waive the home inspection contingency.

rusty water heater

The Risks of Waiving a Home Inspection

A home inspection is an important element of the home buying process for protecting a buyer's financial interests. For example, learning that a home you're interested in may need a new septic system costing $10,000 can change your mind about buying it or the amount you're willing to spend. Without a home inspection, you might not find out about the problem until after you take possession, and you will lose any negotiating leverage you might have.

Another consideration is the health and safety of your family. Home inspections can uncover potential hazards in a home, like bad wiring, unsafe heating, or asbestos that the average person would not find during a pre-closing walkthrough.

So Should You Waive The Inspection?

As a general rule, the answer is no unless you're willing and financially able to assume all potential risks. Waiving the inspection is especially problematic in an older house. That being said, there are a couple of instances when waiving the inspection is more of a calculated risk.

If, for instance, you are buying new construction and the home is under the builder warranty, or if the seller of a home or condo has had existing conditional reports compiled within the past year, it is "potentially" ok to waive the right to an inspection, IF it's the only way to ensure your offer is accepted.

Again, it all comes down to the amount of risk you're willing to take. Remember, even new construction can have problems that an inspection could uncover. The bottom line, spending a few hundred dollars on an inspection is almost always a good investment. However, in a market that is hot, taking a calculated risk may be necessary to ensure your bid is accepted. 

Making A Strong Offer Without Waiving the Inspection 

While any seller will prefer receiving an offer that waives the home inspection, there are ways and tactics allowing you to present a strong offer that will appeal to a seller and keep the inspection on the table. 

  • Be fully preapproved!

Having a preapproval letter from a lender in hand when presenting your offer carries weight. It not only shows the seller you're serious but that you have financing available to close the deal.

  • Ask for an "informational inspection" contingency.

This language tells the seller that you will be getting a full, professional inspection but only for informational purposes. Any information it uncovers will be for you. You won't be asking them to pay for any issues it uncovers.

  • Make a larger downpayment.

It might mean saving for a little longer, but seeing more upfront cash might tempt a seller. It feels like more money in their pockets right away. This can signal that your financing is solid and the deal will close. 

  • Add an Escalation Clause.

This is another tactic that is attractive to sellers. An escalation clause eliminates the need for a back-and-forth negotiation between two buyers. For example, say you're interested in a home that is listed for $175,000. You can offer to automatically bid $1000 over any other offer with a cap of $200,000.

While these tactics can help you look more attractive to a seller and leave the home inspection clause intact, you might still lose out to a buyer willing to take the risk and waive the inspection, especially in a tough market like today. Regardless, if you lose out, brush yourself off, and keep looking! Eventually, you'll find your home and do it in a way that is comfortable for you!

Can a Home Warranty Help?

Ultimately, if you opt to waive the home inspection, consider purchasing a home warranty. Whichever path you choose, a home warranty provides you with a safety net should unexpected expenses present themselves. Click here to learn more about Home Warranty programs, benefits, and pricing. 

January
11

Smart Home Tips

Smart home technology has been available to consumers for more than 20 years now. But it's really only in the last decade that the idea of a smart home has become mainstream. 

If you're wondering how you can use technology to make your home better, smarter, more efficient, and more secure, then you're in luck. As we head into the new year, our real estate agents are excited to share these smart home technologies for 2021. 

  • Smart Home Assistant
    One of the most popular smart home innovations in recent years, smart home assistants have proven to be more than a fad. Many different makes and models are available—Amazon Alexa and Google Home Assistant are some of the most well known—offering you a wealth of tools at your fingertips. Smart home assistants give you hands-free control to play music, look up directions, place calls, help with your shopping, and a seemingly endless array of other tasks.

  • Smart Thermostat
    Replacing your old, outdated thermostat with a modern smart thermostat is a great way to improve comfort and energy efficiency in your home. You can make adjustments to the temperature via a smartphone app, even when you're not at home. 

  • Smart Fridge
    It's true. Your refrigerator could probably be smarter. Most major fridge manufacturers have smart fridges in their lineup these days, and there are a wealth of benefits, including saving energy and reducing food waste. Using the accompanying app, you can adjust the fridge and freezer settings from your phone. You can also choose to get alerts when the door is left ajar or time for a water filter change. 

  • Smart Door Locks
    Improved security has always been one of the big advantages of a smart home, and smart door locks were one of the first features to catch on in a big way. Rather than looking for the right key, you can lock or unlock your door by thumbprint, by entering your PIN, or using an app on your smartphone. Many smart locks also have a built-in alarm system. 

  • Smart Lighting
    Smart light bulbs offer a major innovation for comfort and efficiency. You can turn lights on and off in any room of your home using voice commands or a smartphone app, including dimmer settings, so you can specifically adjust the brightness of certain lights. Of course, the real benefit is that if you forgot to turn off the downstairs lights before tucking yourself in for the night, you could switch them off without getting out of bed! 

  • Smart Cameras
    Security cameras have come a long way, and the latest smart cameras give you amazing control and security without invading your privacy. With two cameras in front and back of your house, you can have your entryways covered, with the ability to see the footage in real-time from your phone. 

  • Smart Hub
    A smart hub is essentially the "brains" of your smart home, connecting all your other smart devices and features. Essentially, it greatly simplifies things by making it possible to control your entire smart home using a single app. Some (but not all) smart home assistants include a smart hub, so you may or may not need a separate hub, depending on your setup. 

Whether you're looking to buy or sell a home or are simply ready to take your living space to the next level, smart home technology is an important consideration. Contact us today to learn more and talk to our team about ways to make your home smarter in 2021. 

October
5

Move to New England

Buying a home is quite an undertaking, even when you're just moving across the neighborhood. Relocating to a different state presents even more challenges. With so many individuals moving to a different climate, relocating for work, or simply packing up and heading to a city that suits their evolving lifestyle, buying a home in a different state is becoming increasingly common.

Zoom Towns are also driving out of state relocation. Zoom Towns are towns that are seeing an increase in residents, specifically professionals who desire a remote workplace in an area that offers more space and solitude than larger urban settings. For instance, the Zoom Towns are popping up throughout New England as professionals from the greater NYC and Boston areas seek out work-from-home opportunities.

If you're considering buying a home in a different state, here are a few things that you should know.

  1. Do Plenty of Research
    If you think you've done enough research on your desired location, do some more! There are many aspects of your new area that will impact your life, such as new residential or commercial developments, new roadway construction, and school rezoning. Learn as much as possible about the area you desire so you can feel fully informed when you arrive.

  2. Create a Moving Checklist
    While a moving checklist is helpful for all moves, it's especially vital when relocating to a new state. For instance, many homeowners forget to change their address for delivery services such as Amazon. By creating a to-do list that addresses all aspects of your previous home life, you can ensure that you have everything transitioned to your new home as smoothly as possible.

  3. Try to Visit the Area 
    It may be difficult to travel to another state every weekend, but you should try to visit the area a few times before your move. Spend a night or two near where your new home is and live life like a local. Go for a drive during peak traffic hours. Discover where your favorite stores are located. Find a few hidden gems. The more frequently you visit, the more like home it will feel.

  4. Understand the Other Costs of Living 
    Unfortunately, home values are not the same across the country. Not only do you need to understand how much home you can afford via the mortgage, but you also much take note of the cost of living in your new area. For instance, you may not pay a state income tax in Florida, but you will in Pennsylvania. Also, moving from Florida to Pennsylvania may decrease your air conditioning usage, but your electric bill may still rise as you use your furnace more often. Make a spreadsheet of your current yearly living expenses and try to find data from your new location to help you compare costs.

  5. Ask "Stupid" Questions
    Buying a home is one of the largest financial purchases you'll ever make, so you should ask as many questions as you have. When it comes to real estate transactions, there are no stupid questions. Your agent will be happy to answer and address every concern you have, so you feel comfortable and confident in your purchase.

Moving to a new state doesn't need to be overly complicated. Whether you're headed to a Zoom Town for work or relocating for family, following these tips will help make the process as swift, smooth, and stress-free as possible. And you don't have to go through this process alone! Our expert agents and our extended network of real estate professionals across the country are here to assist. Contact us today to get started. 

September
28

Maine's Lakes region

With social distancing giving a boost to the already growing work-from-home trend, any place with a WiFi signal can become an office. If commuting is no longer an issue, why not live in a Zoom Town, where every day is a vacation?

Leave the urban hustle and bustle behind. Our real estate agents share some appealing reasons why Maine's Lakes Region should be your new home. 

Click Here to Read More...

September
21

Zoom Town Trend

With this year's pandemic accelerating the shift towards remote work, living near the office is quickly becoming a thing of the past. With so many people working from home, many are taking advantage of the opportunity to reconsider their home's location. Not only is this spurring a quick recovery for the housing market, but it's also leading to an exciting new trend that's popping-up here in 2020: the rise of the Zoom Town.

So what exactly is a Zoom Town? It's often a beach town, lake town, or even just a peaceful secluded area of the country. More importantly, it's far away from the normal bustling cities that have traditionally served as the heart of the business world. Zoom Towns are seeing rapid growth this year, as many people are choosing to work where they vacation and vacation where they work.

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September
9

With all of the economic chaos that is 2020, real estate has remained a bright spot.

There are 4 major economic factors affecting home prices:

  • Unusually high buyer demand

  • Historically low interest rates

  • Near-historic low inventory

  • Extra high buyer demand due to a major resettlement to northern New England of work-from-home buyers looking to move out of the major urban centers like Boston, New York City, metropolitan Connecticut & New Jersey.

As a home seller, you can take advantage of the market and, essentially, get a premium price for your home.


But here's the catch: you then have to become a buyer in the same market of low inventory & high demand.

This is the exact reason to engage a Better Homes & Gardens, The Masiello Group REALTOR. We recommend consulting with a Better Homes & Gardens Real Estate The Masiello Group REALTOR to determine these 3 parameters to help hand-craft a solution for you:

  1. The current market value expectation for your home in today's market.

  2. Your ideal next home, moving time frame and other unique conditions that may exist in your world (think: specific home needs, locations, retirement schedule, children's school schedules to name a few)

  3. Your purchasing power in the market based on the current low rates. (Your Better Homes & Gardens Real Estate The Masiello Group REALTOR can connect you with our Great East Mortgage Partner to confidentially determine your new home price range).

Next, your Better Homes & Gardens Real Estate The Masiello Group REALTOR can approach other home owners with properties like the ones that best fit your ideal new one. These will likely be other owners who, like you, are not currently on the market but would move if they could find a home. See how the chain can work?

At BHGRE The Masiello Group, our agents have 2 important tools in our internal website to make this work for you:

  • The "Haves & Wants" function

  • Our Reverse Prospecting tool

The Haves & Wants System is like a bulletin board for our agents to share info on people, like you, that are looking for something that is not yet on the market as well as sellers who would sell if they could buy.

Our Reverse Prospecting Tool matches information about registered users on our website to each other. For example, a potential seller in Portsmouth, NH looking to buy in York, ME gets matched to a buyer in Portsmouth, NH.

While technology provides many answers, only an experienced Better Homes & Gardens Real Estate The Masiello Group REALTOR can apply their market knowledge, street wisdom and technology to your unique situation.

 


Reach out today and let's explore what this market could do for you & your family.

Click here to contact our expert agents.

September
8

Closing Process

You've found a home that you love, and the seller has accepted your offer. However, it isn't a done deal until you sign the closing documents. 

In the meantime, here are a few things that our real estate agents recommend that you avoid during the closing process. While some of these don'ts may result in a higher interest rate, others can potentially sabotage the purchase of your new home.

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May
18

Why Home Equity is a Bright Spark in the Housing Market | MyKCM

Given how we have seen more unemployment claims than ever before over the past several weeks, fear is spreading widely. Some good news, however, shows that more than 4 million initial unemployment filers have likely already found a new job, especially as industries such as health care, food and grocery stores, retail, delivery, and more increase their employment opportunities. Breaking down what unemployment means for homeownership, and understanding the significant equity Americans hold today, are important parts of seeing the picture clearly when sorting through this uncertainty.

One of the biggest questions right now is whether this historic unemployment rate will initiate a new surge of foreclosures in the market. It's a very real fear. Despite the staggering number of claims, there are actually many reasons why we won't see a significant number of foreclosures like we did during the housing crash twelve years ago. The amount of equity homeowners have today is a leading differentiator in the current market.

Today, according to John Burns Consulting58.7% of homes in the U.S. have at least 60% equity. That number is drastically different than it was in 2008 when the housing bubble burst. The last recession was painful, and when prices dipped, many found themselves owing more on their mortgage than what their homes were worth. Homeowners simply walked away at that point. Now, 42.1% of all homes in this country are mortgage-free, meaning they're owned free and clear. Those homes are not at risk for foreclosure (see graph below):

Why Home Equity is a Bright Spark in the Housing Market | MyKCM

In addition, CoreLogic notes the average equity mortgaged homes have today is $177,000. That's a significant amount that homeowners won't be stepping away from, even in today's economy (see chart below):

Why Home Equity is a Bright Spark in the Housing Market | MyKCM

In essence, the amount of equity homeowners have today positions them to be in a much better place than they were in 2008.

Bottom Line 

The fear and uncertainty we feel right now are very real, and this is not going to be easy. We can, however, see strength in our current market through homeowner equity that has not been there in the past. That may be a bright spark to help us make it through.

April
16

Think This Is a Housing Crisis? Think Again. | MyKCM

With all of the unanswered questions caused by COVID-19 and the economic slowdown we're experiencing across the country today, many are asking if the housing market is in trouble. For those who remember 2008, it's logical to ask that question.

Many of us experienced financial hardships, lost homes, and were out of work during the Great Recession – the recession that started with a housing and mortgage crisis. Today, we face a very different challenge: an external health crisis that has caused a pause in much of the economy and a major shutdown of many parts of the country.

Let's look at five things we know about today's housing market that were different in 2008.

1. Appreciation

When we look at appreciation in the visual below, there's a big difference between the 6 years prior to the housing crash and the most recent 6-year period of time. Leading up to the crash, we had much higher appreciation in this country than we see today. In fact, the highest level of appreciation most recently is below the lowest level we saw leading up to the crash. Prices have been rising lately, but not at the rate they were climbing back when we had runaway appreciation.Think This Is a Housing Crisis? Think Again. | MyKCM

2. Mortgage Credit

The Mortgage Credit Availability Index is a monthly measure by the Mortgage Bankers Association that gauges the level of difficulty to secure a loan. The higher the index, the easier it is to get a loan; the lower the index, the harder. Today we're nowhere near the levels seen before the housing crash when it was very easy to get approved for a mortgage. After the crash, however, lending standards tightened and have remained that way leading up to today.Think This Is a Housing Crisis? Think Again. | MyKCM

3. Number of Homes for Sale

One of the causes of the housing crash in 2008 was an oversupply of homes for sale. Today, as shown in the next image, we see a much different picture. We don't have enough homes on the market for the number of people who want to buy them. Across the country, we have less than 6 months of inventory, an undersupply of homes available for interested buyers.Think This Is a Housing Crisis? Think Again. | MyKCM

4. Use of Home Equity

The chart below shows the difference in how people are accessing the equity in their homes today as compared to 2008. In 2008, consumers were harvesting equity from their homes (through cash-out refinances) and using it to finance their lifestyles. Today, consumers are treating the equity in their homes much more cautiously.Think This Is a Housing Crisis? Think Again. | MyKCM

5. Home Equity Today

Today, 53.8% of homes across the country have at least 50% equity. In 2008, homeowners walked away when they owed more than what their homes were worth. With the equity homeowners have now, they're much less likely to walk away from their homes.Think This Is a Housing Crisis? Think Again. | MyKCM

Bottom Line

The COVID-19 crisis is causing different challenges across the country than the ones we faced in 2008. Back then, we had a housing crisis; today, we face a health crisis. What we know now is that housing is in a much stronger position today than it was in 2008. It is no longer the center of the economic slowdown. Rather, it could be just what helps pull us out of the downturn.

 


We encourage you to reach out to our expert agents to discuss your unique buying or selling situation. We're here for you!

April
13

Neighborhood for Your Dog

There's so much to consider when picking out a new neighborhood. It needs to be the proper place for you and your family, but what about Fido? Will your dog love and appreciate the neighborhood that you choose? Here are five tips for picking a neighborhood your dog will love.

  1. Get a Big Yard
    It's convenient to let your pooch play in your own yard without having to take him on a leash to the park each day. Consider how much space your dog will have to roam. Bonus points if there is a safe, reliable fence, doghouse, or kennel already included with the yard.
  2. Check Out Other Dogs
    When you go to check out a house or neighborhood be on the lookout for people out walking their dogs. Or maybe you'll see some pups playing in a fenced-in yard. These are good clues that your neighbors enjoy dogs and that you'll probably be warmly welcomed.
  3. Find Easy Access to Dog Care
    As a pet owner, you want to be prepared when you move into your new neighborhood. Have an idea of where to find the following pet services. 
    • Does this new neighborhood offer close proximity to a veterinarian clinic? If your dog currently has prescriptions, can you or another family member get to the clinic easily to fill them when they're due?
    • Does the vet clinic offer 24/7 emergency services? 
    • Are there obedience classes and groomers in the area?
    • Are there specialty pet stores or wholesale stores that offer the necessities?
    • If you work long hours, take vacations, or need to hop on a plane for a family emergency across the state or country, is there a highly-rated doggy daycare, a network of pet sitters, or any kennels nearby?
  1. Seek Safe Walking Paths
    Your dog will love a neighborhood where they can go on frequent walks with you. Be on the lookout for well-lit sidewalks. If there are no sidewalks, is the street full and safe enough to walk in regularly? You and your dog need a convenient way to exercise, and whether you walk down the sidewalk for an hour a day or need a quick way to get to the local dog park, great walking paths are a necessity. If you live in a snowy area, take notice of whether your neighbors and the city/town employees clear the sidewalks promptly. 
  2. Check Out Community Camaraderie
    Does your neighborhood seem to welcome four-legged friends? Be on the lookout for the following things when touring the neighborhood:
    • Are there several "No Pets Allowed" signs? 
    • Do community members allow their pets to wander? If so, will rogue cats and dogs drive your pup crazy and turn stress-relieving walks into nightmares?
    • Do the restaurants include seating for pups or outdoor patio areas for you and your canine companion to dine?
    • Are there trash cans along the main streets to offload stinky poop bags during outings? 
    • Are dog parks within walking distance? Try to hit the park on a busy weekend to see if the dogs and their owners seem respectful of one another.
    • Are there community canine-themed events like dog shows and parades?

These tips will help you get a good idea if this new neighborhood will be the best fit for you and your canine. Our real estate agents are also here to assist you. Contact us, and we can help you find the perfect neighborhood for you and your pooch.

March
31

The Economic Impact of Buying a Home

The Economic Impact of Buying a Home | MyKCM

We're in a changing real estate market, and life, in general, is changing too – from how we grocery shop and meal prep to the ways we can interact with our friends and neighbors. Even practices for engaging with agents, lenders, and all of the players involved in a real estate transaction are changing to a virtual format. What isn't changing, however, is one key thing that can drive the local economy: buying a home.

We're all being impacted in different ways by the effects of the coronavirus. If you're in a position to buy a home today, know that you're a major economic force in your neighborhood. And while we all wait patiently for the current pandemic to pass, there are a lot of things you can do in the meantime to keep your home search on track.

Every year the National Association of Realtors (NAR) shares a report that notes the full economic impact of home sales. This report summarizes:

"The total economic impact of real estate related industries on the state economy, as well as the expenditures that result from a single home sale, including aspects like home construction costs, real estate brokerage, mortgage lending and title insurance."

Here's the breakdown of how the average home sale boosts the economy:The Economic Impact of Buying a Home | MyKCMWhen you buy a home, you're making an impact. You're fulfilling your need for shelter and a place to live, and you're also generating jobs and income for the appraiser, the loan officer, the title company, the real estate agent, and many more contributors to the process. For every person or business that you work with throughout the transaction, there's also likely a team behind the scenes making it all happen, so the effort multiplies substantially. As noted above in the circle on the right, the impact is almost double when you purchase new construction, given the extra labor it requires to build the home.

The report also breaks down the average economic impact by state:The Economic Impact of Buying a Home | MyKCMAs a buyer, you have an essential need for a home – and you can make an essential impact with homeownership, too. That need for shelter, comfort, and a safe place to live will always be alive and well. And whenever you're able to act on that need, whether now or later, you'll truly be creating gains for you, your family, local business professionals, and the overall economy.

Bottom Line

Whenever you purchase a home, you're an economic driver. Even if you're not ready or able to make a move now, there are things you can do to keep your own process moving forward so you're set when the time is right for you. Let's connect to keep your home search – and your local contributions – on track.

 

Contact our expert agents today

March
16

Newlyweds and Home Buying

For many couples, the first major decision they make after they say 'I do' is purchasing a home. Whether the couple wants a place of their own, plans on having a family, or simply wants to relocate to a space that suits their new life together, it's important that all couples learn as much as they can about the homebuying process. Our real estate agents believe that all newlyweds should consider the following.

  1. Consider the Present
    The thought of buying a home is exciting; now is not always the right time for some couples. Aside from your financial status, you must be realistic about your current commitments. Do you have the time to devote to home searching and moving? Do you know exactly where you want to live right now? Consider your current situation and question if now is the right time to make such an important decision.

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February
24

VA Loan 2020

If you are planning on using a VA loan to purchase a home this year there are several changes you should know about. 

Following the Blue Water Navy Vietnam Veterans Act of 2019, veterans and military service members will enjoy more borrowing power but pay slightly higher fees when applying for VA home loans. The Act was signed into law in June 2019 but took effect Jan 1, 2020.

Navigate these changes to VA loans with a little help from our team. Our REALTORS® highlight everything you need to know about using VA loans in 2020!

No VA Home Loan Limits in 2020

The VA loan limit is the maximum loan amount the Department of Veterans Affairs can guarantee a veteran or military service officer without making a down payment. The loan limit adjustment is a big win for veterans across the nation, especially for those buying in pricier markets. Extending the zero-down purchasing power will save many veterans a lot of cash and help them remain competitive.

However, the elimination of loan limits doesn't signify unlimited borrowing power with no down payment. Veterans will still need to have adequate income and meet their lender's credit demands to qualify for the VA loan amount. And if you still have impending VA loans or have defaulted on a previous loan, the loan limits will still be applicable throughout 2020.

Before this act went into effect, VA loan limits equaled the limits set by the Federal Housing Finance Agency on complying loans. In 2019, the limits were set to $484,350 in a typical US county and slightly higher in high-cost counties.

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February
17

Relocation Tips

Buying a home in a different state can be a daunting task, especially if you know little about the state and the applicable local property regulations. However, with proper planning, preparation, and thorough research, you can identify your top property choices. In this guide, our REALTORS® have pieced together helpful tips for buying a home out of state. 

  1. Research Area Costs
    Explore the difference between the cost of living in your state and that of your desired new city, especially if you plan to live or vacation more often in the new state. Large cities usually have different costs of living depending on the neighborhood, so check options in various parts of the city. Evaluate all potential costs of buying the home before committing. Some cost implications may include costs of upgrading the home, closing and insurance costs, and repair or replacement of various appliances. Also, call insurance providers or agencies to get estimates.
  2. Ask About Property Restrictions
    Before you even travel to view your preferred homes, ask about property restrictions in your new state. For example, if you're buying a rental property, call the homeowners association to see if you're able to rent out a property in that neighborhood. If you want to install a new pool, check local and neighborhood rules to ensure it's possible before taking the time to view the property.
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February
3

Home Purchase Questions

Our REALTORS® are there to guide you every step of the way when it's time to buy a home. Still, it's important to understand what you're getting into – and how to advocate for your interests.

Buying a home can include twists and turns, even when everyone has the best intentions. Knowing which questions to ask will help you get the information you need to make an informed decision about your real estate options.

Don't forget these vital questions when you're getting ready to buy a home:

  1. Why is the Seller Leaving?
    Understanding the seller's motivations will put you in a position to get a better deal. You don't have to offer more money to make a seller's day: For example, if there's a tight timeline for moving, you may be able to get price concessions in return for making a prompt commitment.
  2. How Long Has the House Been for Sale?
    The longer a house is on the market, the more negotiating power a prospective buyer has. Houses can end up lingering on the market when the original asking price is too high. If more than 30 days go by, it means a more motivated seller. More than 60 is "red alert" for most sellers.
  3. What Are the Neighbors Like?
    You might not see them every day, but next-door neighbors can be a blessing or a curse. Inconsiderate or loud neighbors can leave you dealing with a whole host of worries, from midnight noise issues to lawn debris ending up on your side of the fence. Meeting the neighbors in person is often a good idea!

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January
27

Buying a Home During Retirement

If you're recently retired or planning for your retirement, you may decide to purchase a new home. Many retirees buy new property, either to downsize from an existing home or to relocate to a more favorable area. Our real estate agents can help you locate properties that are a good fit for your post-retirement needs. Follow these guidelines to make sure purchasing a home is appropriate for your finances and personal retirement goals.

Rethink Moving to a "Bucket List" Destination

Once you retire, it's easy to get caught up in fulfilling your post-retirement dreams. Maybe you've always wanted to live at the beach town where you vacation every summer, or perhaps you've envisioned retiring to a secluded cabin in the mountains. However, before you purchase property in these dream locations, you need to make sure these cities are places that you want to live.

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January
20

Starter Home Tips

Every first-time homebuyer is quickly faced with the same question: to build a budget for a forever home, or shop for a starter home that suits your current needs? A starter home can be an excellent option for a first-time buyer, allowing you to get used to the homeowner's lifestyle, build equity in the home over time, plan for the future, and eventually move on to a forever home. Our real estate agents know exactly what it takes to find the right home for any buyer, and we've put together a guide for what you should look for in a starter home.

  • Neighborhood and Location
    The neighborhood that you choose plays an important role in both the price of the property and how much you'll enjoy living there. To start, decide whether you want to live in an urban, suburban, or rural location. Then look at specific neighborhoods to find a spot with the right mix of attractions, services, and commute times for your needs. The most popular neighborhoods tend to be more expensive, but most neighborhoods have affordable starter options if you're willing to search.

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December
23

New Home in 2020

If you've been dreaming of buying your first home or selling your current house, New Year's is the time to resolve to make it happen.

Our REALTORS® suggest the following five ways to make a New Year's resolution of a new home a reality in 2020.

  1. Check and Fix Your Credit
    Your credit will affect whether you can qualify for a mortgage loan and the interest rate you'll pay. Start by checking your credit report with the three main reporting agencies – Equifax, Experian, and TransUnion – by requesting it for free at AnnualCreditReport.com, a site recommended by the Federal Trade Commission. If you see any errors, request a dispute form from the reporting agency. And if your credit is poor, start working to pay down your debt.

  2. Save for a Down Payment
    Most mortgage loans require a down payment, so you may want to trim your budget to help bolster your down payment fund. Tax refunds can also be an excellent way to jumpstart your savings.

    If you can afford to pay 20% down, you'll avoid paying private mortgage insurance (PMI). This is an extra monthly payment that helps protect the lender in case you default on your loan. The higher your down payment, the lower your monthly payment will be, and you're likely to be offered a lower mortgage rate.

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June
25

Our REALTORS® at The Masiello Group know the decision to move from renting to owning a home is not always an easy one to make. First-time buyers often feel challenged by the complexity of the process. There are also many financial angles to consider when you buy a home.

However, a changing lifestyle can mean it is time for a new perspective on homeownership. Let's look at some of the biggest reasons you might go from renting to buying a home.

First Sign of Knowing It's Time to Buy a Home

Your Family Needs More Space

Many millennials are putting off certain life milestones, like homeownership and starting a family. However, needing more space does not always mean you have a baby on the way. Many people decide to house hunt to provide more space for dogs! Cities are seeing more households made up of friends who may need sufficient space to themselves, too. Extra room also means more space for yourself, you could considering creating an office, art studio, gym, or music room.

The Second Sign

You Can't Imagine Renting Again

Yes, getting a mortgage loan can be a time-consuming process. When all is said and done, though, it's not that much harder than getting into an apartment. After all, you need all of the same documentation. You'll also have to go through all of the usual steps of moving. When you buy a home, you'll get it all done in one fell swoop for many years to come. It will be more fulfilling to do all the same work it took to rent a home, and then actually be able to say, I bought a home.

The Third Sign

The Financial Side Isn't Working for You

In some areas, it makes better financial sense to buy a house than to rent. This is most common in large cities and areas where rapid growth puts pressure on the housing stock. As landlords try to squeeze every penny from potential tenants, you could find your mortgage will be less expensive. Just remember to consider the annual cost of home maintenance, too. It is also important to consider mortgage pre-approval before you buy a home because it will save you and your REALTOR® valuable time. Take a look at our blog on the importance ofmortgage pre-approval to learn more.

The Fourth Sign

You Have Other Long-Term Plans to Buying a Home

Just because you are buying a home, it does not necessarily mean you'll live there. If you're in an area people are eager to move to you could use it as an income opportunity. Many people buy homes to refurbish and "flip" them. The average investor makes $30,000 net profit on a house flip if all factors align.For long-term income, you might decide to rent out your new property instead. As an owner, the choice is always up to you.

The Fifth Sign

You Are Moving On Up Financially

A new job, a promotion or even a one-time windfall can signal that it's time to re-evaluate your housing situation. If your credit is strong, you may qualify for attractive mortgage loans even if you do not have a lot of cash on hand. With money to spend, you can further reduce interest rates with a down payment or paying off your closing costs without financing.

 

If you are thinking about buying a home, it's time to find out more – even if you can't quite put your finger on why. You can check out The Ultimate Home Buyers Guide to learn more about all the steps it takes to buy a home. An expert real estate agent who specializes in first-time homebuyers can also give you personalized advice to help you decide on your next move.

Contact us to find out more today. We look forward to helping you soon.

 

https://newsilver.com/the-lender/what-is-the-average-net-profit-for-flipping-a-house/

November
25

Saving for Down Payment

Is the anticipation of needing to make a sizeable down payment discouraging you from homeownership? According to data from a U.S. Census housing survey, nearly 50 percent of current homeowners made down payments of 10 percent or less. 

Don't let the need to make a down payment discourage you from purchasing your first home. 

Our REALTORS® have put together a list of useful tips to save for a down payment.

  1. What Is Your Goal?
    Start with the end in mind. Figure out a realistic price range of homes you can afford, how much of a down payment you'll need and your time range. Getting prequalified is a helpful exercise to get some substantial numbers.

  2. Create a Budget 
    You already know a vague intention of putting money away "when you can" isn't going to work. Whether you use a spreadsheet or paper and pencil, write down every penny that comes in and goes out each month, so you know where you stand.

  3. Set a Monthly Savings Amount
    Once you have an amount in mind, you can determine how much money to save each month to make it happen. If you don't have enough disposable income for your goal, there are two options: reduce the amount of money spent or increase earnings.

  4. Cut Back on Spending
    When is the last time you examined your spending patterns? Certain expenses are fixed, but you can almost always find things large (vacations) and small (daily lattes) to forgo.

  5. Boost Your Income
    Gone are the days when traditional full-time jobs are the only way to make money. With options like selling on eBay, driving for Uber or freelance writing, the possibilities are endless. As a bonus, you work when you want instead of on someone else's schedule.

  6. Pay Off Debt
    Putting money aside while you're paying out on credit card interest is taking one step forward and two steps back. Pay off any outstanding credit card balances, prioritizing ones with the highest interest rates.

  7. There's an App for That
    Automate savings with an app like Digit, which analyzes your spending patterns and finds opportunities to put money away painlessly. You can also use direct deposit to funnel money into savings before it gets into your hands.

  8. Ask for Cash
    Let family and friends know about your plans and ask them to give cash for birthdays, holidays, or any other gift-giving occasion.

  9. Say Goodbye to Splurges
    Do you generally treat yourself to extravagant purchases when you receive bonuses, tax refunds, or other "found" money? Adding those funds to your down payment savings will eventually pay off.

  10. Look into Assistance Programs
    Many state and local governments have down payment programs offering assistance through grants, interest-free loans, or traditional loans. Also, the Federal Housing Administration (FHA) loans allow borrowers to put down as little as 3.5 percent depending on your credit score.

  11. Tap Retirement Accounts
    If you have a 401(k) or individual retirement account (IRA), check the rules regarding withdrawals or loans for down payments. While penalties may be waived, you will still have to pay taxes, so be sure to consult with a financial advisor.

We have years of experience helping people of all ages and financial situations reach their dream of homeownership. Contact us to learn more about what we can do for you.

October
7

Commute Time for New Home

Commute time is an important factor you should consider when buying a new home. While a long commute may not bother you at first, it may affect your lifestyle and ability to enjoy your new home. For many, finding the perfect home means balancing price, location, community amenities, and distance to the office. With a little planning, it is not hard to find a balance between time in the car and time spent in the home of your dreams. 

The Peace and Quiet of the Countryside

Many people choose to commute do so because they find a little slice of heaven far away from city centers and nosy neighbors. Maine is filled with beautiful properties hidden in the hills or nestled along the coast. These charming properties are the perfect place to rest and recharge after a long day at work. If you want to purchase these relaxing retreats, it may mean a commute of 15, 30, 45 minutes, or more to your office. Nationwide, the average commute is 26 minutes. If you are looking at a longer commute, it means you will have that much less time each day to enjoy your home.

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July
23

It would be nice if every house negotiationwent smoothly, but unfortunately, that's not always the case. Whether the seller is unwilling to negotiate or a closer look at your "dream" home reveals serious issues, sometimes it's better to walk away. Our real estate agents know what it takes to land your dream home, so let's take a closer look at the signs that it's time to walk away from a house negotiation.

Signs It's Time

Seller Refuses to Negotiate in Good Faith

Every successful negotiation requires compromise, and it's hard to find common ground when the seller refuses to negotiate in good faith. An overly rude seller refuses to listen to your concerns, or seems unwilling to budge on even the smallest issues may not be worth the trouble. You don't have to feel like the seller is going to be your best pal after negotiations, but civility and courtesy go a long way.

Falling In and Out Of Love with a Home

There's no avoiding the fact that buying a home is often an emotional process, and at some point in the shopping process, most buyers fall in love with a home. It's normal to get excited about a home that seems to suit your needs. Sometimes love at first sight turns into cold feet when it's time to commit. If the home you thought you love isn't all it's cracked up to be, then it may be time to move on to your next option.

Seller Conceals Key Information From House Negotiation

While disclosure rules vary by location, in most places, sellers are required to disclose certain serious maintenance issues with the home. This may include things like flooding, leaks, foundation damage, roof damage, and damage to key systems within the home. If you discover the seller has been trying to hide issues that they're required to disclose, it's better to walk away.

Inspection Uncovers Serious Issues During House Negotiation

The home may have issues turn up during the inspection that the seller wasn't aware of, and those issues may be serious enough to make you think twice. If the home inspection does reveal serious issues, you'll have to consider whether it's worth the time and money to fix the home before you decide whether to buy.

Too Much DIY

Tackling projects around the house is simply part of owning a home, but not every owner is qualified to handle home improvement projects. If the home has too many DIY fixes that would have to be repaired by professionals, it may no longer be the right fit for your budget.

Pest Issues, Mold, and Other Hidden Problems

If you discover that the home has serious issues with termites, mold, or other hidden problems, those issues will naturally impact your perception of the home. If the cost of repairing termite damage or eliminating mold is more than you bargained for, it's time to shop for a different home.

The Bottom Line When it Comes to House Negotiation

The negotiation step of buying a home can be stressful. An experienced agent can be there to help by giving you advice , and telling you when it might be time to walk away. Whether you're shopping for the first time or getting your search back on track after a failed negotiation, our team is here to help you find a home you'll love. Contact us to buy and sell homes throughout the Northern New England area, and check out The Ultimate Home Buyers Guide to help you on your journey to find a new home.

July
16

What is a Credit Score?

Your credit score is a little three-digit number between 300-850 that depicts a consumer's creditworthiness, and that has a BIG impact on your home-buying process. The higher the score, the better a borrower looks to potential lenders. Our real estate agents know buying a home is an exciting experience. Whether it's your first time purchasing a property or if you're moving into a new space that will cater to your changing lifestyle, we want to make sure that your experience is an easy one.

How Credit Scores Impact Buying a Home

With years of experience helping clients buy and sell homes, we understand real estate transactions inside and out. Our customers often ask questions regarding how a credit score impacts purchasing a home. To provide you the best advice, we've answered some of the most common questions about credit scores so you can head into your home search with confidence.

Does my credit score matter?

Yes! Your credit score is an essential aspect of your financial life. Although it is an important consideration in a real estate transaction, your credit score can also impact other things like buying a car or taking out a loan. You can also leverage great scores into great deals — on credit cards, insurance premiums, apartments and cell phone plans. Bad scores can hammer you into missing out or paying more. According to Nerd Wallet, a 15-year home equity loan of $50,000 would cost a low scorer $22,500 more than someone with high scores.

How is my credit score calculated?

A credit score is composed of many elements, including your credit payment history, your debt-to-credit utilization, your length of credit history, your credit mix, and your new credit accounts.

What credit score do I need to buy a home?

Technically, you can buy a home with any credit score. However, securing financing gets increasingly more difficult the lower your credit score is. Credit scores range from 300 to 850, with anything above 760 considered exceptional and anything below 650 considered less than favorable. For example, a credit score of 700 is good, and you may have an easier time qualifying for a loan than someone with a credit score of 400, which is considered unfavorable in the eyes of lenders. Similarly, those with an 800 credit score should have no trouble getting a mortgage approved by a financial lender.

How can I raise my credit score?

You can always raise your credit score no matter how low it is. Although it may take discipline and time, there's no reason why any individual can't get their credit score to a level which a mortgage lender will approve of. First, you should check your credit score and report to see where you stand. If you notice an error on the report, dispute it so it can be removed. Next, you'll want to gather all of your debts and plan a way to pay them down. Many people choose to pay off smaller debts first to show better management of debt-to-credit utilization. Moving forward, you'll want to ensure that you pay every bill on time so you won't chance missing a payment and dropping your score. Some individuals with limited or very low credit scores may want to consider building new credit responsibly by opening a new credit account, getting a new credit card or taking out a secured loan. Using these resources wisely can help boost your score.

Should I improve my credit score before I begin house hunting?

While it's not absolutely necessary to raise your score before you begin your search, we do recommend that you try to boost it if possible. When you seek out a loan or mortgage, you want to have the highest score and best credit report possible so you can secure funding quickly without trouble.

To learn more about how your credit score impacts the home buying process, contact us today!

August
5

Final Walk-through Checklist for Home Buyers

When you're buying a home, your final walk-through is an exciting moment. This is the crowning moment after months of research and negotiations to go through the property and confirm everything is in the condition you expect. Our real estate agents will go through the home step-by-step with you to ensure the following items on this checklist are accounted for. 

Structural Elements

  • Roof condition - Make sure the roof, rafters, and shingles are in good condition and that there are no "soft spots" or signs of water damage, wood rot, or mold.
  • Siding - Inspect siding for signs of damage, missing planks, mold, etc. 
  • Brickwork/Sidewalks - Look for damage including missing bricks, cracks in masonry, widening joints, crumbling mortar. 
  • Windows/Skylights - Examine windows, skylights, and frames for cracks, drafts, torn screens, and other damage. You will also want to ensure that all windows and skylights open/close correctly and that there are no signs of water damage.

    Click Here to Read More...

July
15

Buy a Home with Student Debt
With the total amount of student loan debt in the United States topping out at over $1.53 trillion, it's no surprise that many college graduates are concerned with how their debts will impact their ability to achieve their other financial goals. 

After finishing college and landing a great job, purchasing a home of your own is often the next logical step, but will you be able to do it if you're debt-strapped?

The answer is yes! Our real estate agents help new college graduates find their dream homes all the time. It will take some planning and preparation, but it's entirely possible. Start by following these five tips. 

  1. Evaluate Your Current Financial Situation
    Before you consider committing to a mortgage, it's essential to take an honest look at your current finances. Do you have enough cash set aside to cover emergency expenses?

    Do you have enough consistent, reliable income to pay your monthly bills and cover your mortgage, taxes, homeowners insurance, and other expenses related to owning a home? Once you can confidently answer "yes" to these questions, you're ready to start getting serious about buying a home.

    Click Here to Read More...

May
28

Newlyweds Guide Home Buying
Congratulations on your marriage! Now that the honeymoon is over, it's time to walk hand-in-hand into the next chapter of your lives! If you're ready to buy a house together, our real estate agents know exactly how excited you are to start picking out your dream home. While we are here to help you through the home buying process from viewing through closing, we also want to help you responsibly prepare for this purchase. We've put together this handy homebuying guide for newlyweds to follow.

  1. Don't rush!
    Buying a house is a significant accomplishment, and although you may be ready to start this new chapter together in a new home, this is another major life decision that you don't want to rush. Remember that buying a home is not like planning a wedding — there is no exact date that you need to have everything ready. Take your time and responsibly prepare so that you can make your home buying goals a reality.

    Click Here to Read More...

May
20

Buying a Pet-Friendly Home
Congratulations on taking the first steps in finding a new home for your family. Of course, your family may include furry friends and it's important that they feel at home just the same. As you tour homes for sale around town, our real estate agents have these points to keep in mind as you search for a pet-friendly home.

  • Start with the inside.
    Before you start hunting for the best backyard space, remember that your dog or cat may spend most of their time indoors. There are certain features or floor plans that will facilitate pets. Mudrooms or outdoor decks are great places to give dirty dogs baths. Ceramic flooring is durable and easy to clean. Low windows and loft spaces give cats great places to sit while single-story homes give older animals the opportunity to explore the house without contending with stairs. Inspect that layout and features of the home from the perspective of your pet the same way you would if you had children or older adults moving in with you.
     

    Click Here to Read More...

May
6

 

Get To Know Your Neighborhood
Welcome to your new neighborhood! Every move is the start of a new adventure and our real estate agents want to help you take the first step on your next journey. We've gathered the following six tips to help you get acquainted with your new neighborhood.

  1. Accept Invitations
    Right when you move in, don't be surprised if your new neighbors stop over and introduce themselves. They may even invite you over for dinner or out for a cup of coffee. Say yes to these kind requests and get to know those who surround your home. This is a great opportunity to make new family friends, learn about community resources and get honest opinions on everything from schools and shopping to the restaurants and recreational parks.
     

    Click Here to Read More...

April
29

 

Buying a Home - Multigenerational Living
Multigenerational living is a term used to describe households in which there are at least two adult generations in residence.  The number of these households in the U.S. is on the rise. Two types of multigenerational living are becoming more common in recent years; two-generation households, where adult children live with parents, and three-generation homes, where there are adult children, parents, and grandparents living under the same roof. Our real estate agents are here to explore some of the pros and cons of multigenerational households with you.

Click Here to Read More...

April
24

You've sold your home, now what?

It's time to pack and move! While stressful, it is the perfect time to organize, declutter and purge all of those unwanted items. Just like the latest organizing trend,
Marie Kondo your moving routine.

Don't know where to start? Here are some of our favorite tips;

Recycle, donate or throw out

If it doesn't spark joy, get rid of it! Contact your local thrift stores, family and friends or post on local facebook marketplaces for a little extra cash. Your junk could be someone else's treasure.

Create a master moving to-do list

This list will include all the tasks and important reminders like grabbing extra boxes and tape, hiring a local moving company or returning your cable box. Utilize you're your smart device to share your google doc list with a spouse or family members to keep everyone in the loop.

Moving tools

Be sure to stock up on moving boxes, tape, permanent markers, and bubble wrap. Create a master labeling system. Label each box with its desired location and then add the box number and contents to your Master to-do list. This will help you tremendously when you are trying to find the dog leash that you thought you left out!

Pack an overnight bag

For quick access, pack a few extra sets of clothes for your family. This will save time and your sanity!

For more tips visit the 41 Easy Moving and Packing Tips that will make your move dead simple blog post.

April
22

 

Buy House Hot Neighborhood
Do you dream of moving into an up and coming neighborhood? Our real estate agents are here to help you identify the areas around your town that will soon explode onto the real estate scene.

  1. Area Improvements
    Keep your eyes open for areas of town that are undergoing massive improvements, both within the infrastructure and commercial contexts. Local governments and private corporations will begin noticeably investing in the renovation of these areas. New transit lines, which includes roadway improvements, will make the area more accessible for the many residents, visitors and commuter employees that are soon to follow. Old buildings will get a new facelift as businesses move in and turn neglect into opportunity. Keep in mind that the presence of any major corporations and retailers is a great sign as well. These companies spend millions of dollars on market analysis and wouldn't invest in an area that wasn't growing positively.

    Click Here to Read More...

April
15

Pay Off Mortgage
Should you pay off your mortgage early?

That's a question that many people struggle with, whether they are already paying on a mortgage or are working with our real estate agents to find a home to buy.

The answer to that question isn't the same for everyone since it depends largely upon each person's financial situation, as well as their long-term goals and preferences. Here are three things to consider as you determine whether or not paying off your home early makes sense for you.

  1. Do you have other debt?
    Given today's low-interest rates for traditional, fixed-rate home loans, chances are good that any other debt you are carrying, be it credit card debt, student loans or auto loans is more expensive than your mortgage. If you are carrying debts with higher interest rates, it makes good financial sense to channel any extra funds you have into paying these off before you worry about making extra payments on your mortgage.

  2. Will paying off your home early leave you cash-strapped?
    There is no harm in doing without a few luxuries to pay off your home more quickly, but you'll want to evaluate your budget carefully to be sure that making extra mortgage payments doesn't leave you on shaky financial ground.

    Leaving yourself cash-strapped to get it done can be risky business if the unexpected happens, like a job loss, for instance, or health problems. It can also cause you financial problems later in life if you're scrimping on retirement savings to prepay your mortgage.

    Before you commit a more substantial chunk of your budget to pay down your home loan more quickly, put some money away for a rainy day. You should save enough to cover your ordinary expenses for at least six months, but preferably a year. Also, be sure that money goes into your retirement fund every month before you send that extra payment on your home loan.

  3. Will your mortgage term stretch into your retirement years?
    Most of us will see a significant decrease in income once we retire. If your loan, should you pay just as scheduled, will still be around when you retire, it may make sense for you to get your home paid off early. Owning your home free and clear by retirement age will pay off by reducing your monthly expenses significantly, right when you likely have less income to meet them.

The bottom line is that, if you can comfortably afford to pay off your home early, it makes sense to do so. You'll save money over the long-term by paying less interest, and you'll also have the peace of mind that comes with having clear title to your home. However, if paying more towards your mortgage will cause undue financial strain, it probably makes better sense to keep up with those agreed-upon monthly payments.

If you have more questions about the pros and cons of paying your home off early, please feel free to contact us. We're always happy to put our expertise and experience on all things related to home ownership to work for the benefit of New England homeowners and home buyers.

July
30

When starting your home search and looking for an agent, the first question a real estate professional will usually ask is "Have you been pre-approved?"

What is a mortgage pre-approval?

A mortgage pre-approval from a lender means they have verified and pre-approved the borrower to borrow a specific loan amount and possibly a specific mortgage type. It is the initial process of qualifying for a mortgage loan. The borrower has submitted the required financial information. This process usually requires pay stubs, bank statements, w-2's, social security number and an inquiry on the borrower's credit.

Why is pre-approval Important when home shopping?

  • It can help you find a reputable and experienced REALTOR®. Many seasoned agents only want to work with buyers who have already been mortgage pre-approved before shopping for a home.
  • Getting pre-approved by a lender at the start of your home shopping process will save you, and your agent, valuable time. Knowing how much you can afford helps narrow down your home search. You can avoid disappointment by shopping too far above your price range. This also helps you avoid settling on a home that may be under your budget that you're not 100% in love with. Your REALTOR® can now find the perfect dream home within your price range.
  • Home sellers will take you more seriously. Having a mortgage pre-approval letter from your lender can give you an advantage when making an offer, especially if there happens to be multiple bids on a property. A seller may be more apt to accept the offer with the pre-approval backing it over an offer from a buyer without. The seller knows that your offer is less likely to fall through, and fewer issues to arise, knowing your lender has already gone through a screening process.
  • It can help in negotiating a price if the seller is eager to sell.
  • A pre-approval helps speed up the process when you are ready to purchase and your offer is accepted. You have already done part of the leg-work and there will be fewer hurdles to jump through.
  • It holds more value than being pre-qualified. Receiving a pre-qualification from a lender only shows that you meet certain criteria to apply for a home loan. This usually only requires a few basic questions. It is not a great indicator of your ability to actually purchase or receive funding.

If you are accepted for a mortgage pre-approval:

  1. Keep your finances operating as-usual.
  2. Don't open any new lines of credit.
  3. Don't fall behind on current payments.
  4. Your pre-approval is usually valid for 60-90 days

How to become pre-approved

Requirements for Mortgage Pre-Approval

  1. Proof of Assets
  2. Good Credit
  3. Proof of Income
  4. Employment Verification
  5. Any other two types of documentation: usually a driver's license or Social Security number

According to Investopedia, Consulting with a lender before the homebuying process can save a lot of heartache later. Gather paperwork before the pre-approval appointment, and definitely before you go house hunting.

Are you ready to get started? Click here to learn about our reliable mortgage partners!

https://www.masiello.com/mortgage-services

Click here to find your next home!

 

https://www.investopedia.com/financial-edge/0411/5-things-you-need-to-be-pre-approved-for-a-mortgage.aspx

July
9

How to Get Your Dream Home

So you have done the rounds shopping for just the right New England dream home for you. You're finally in the home stretch, having found your dream home. However, there is a problem. Other buyers have decided it is their dream home too, and you've found yourself having to compete for your new home. So what do you need to know about duking it out with competing home buyers to increase your odds of coming out on top?Our real estate agents have some tips and tricks that can help you get to your dream home fast and easy.

Step One

Use a buyer's agent

Having an agent that works directly for you is a big advantage when buying a home. A good buyer's agent will have extensive experience in the market you're shopping. They will also have access to more information about listed homes, and will be looking out for your best interests, rather than those of the seller. Having an expert in your corner to guide you can make a big difference when it comes to competing with other buyers to purchase the home you have your heart set on. According to the National Association of Realtors, 88% of buyers purchased their dream home through a real estate agent or broker—a share that has steadily increased from 69% in 2001.

Step Two

Get pre-approved for a home loan

It is always best to get a mortgage pre-approval before you begin shopping for a new home. It is essential to do so if you're planning to submit an offer on a house where there are likely to be competing offers from other buyers. You want to be able to show that you can afford the home in question to ensure that the seller takes your offer seriously. Also, if any of your competing buyers have not yet made this step, you'll increase your odds of being seen as the more prepared and serious buyer. Take a look at our blog on the importance ofmortgage pre-approval to learn more.

Step Three

Limit contingencies

If more than one buyer is bidding on your dream home, presenting a clean offer, with as few contingencies and demands as possible, can increase the odds that the seller will look upon your offer more favorably than those of more demanding buyers.

Step Four

Make a large earnest money deposit on your Dream Home

Putting a larger than average chunk of cash down for earnest money can sway sellers. This will make it known that you are committed and ready to buy. Putting down a large earnest money deposit will also ensure added insurance on the transaction for both the buyer and the seller. 

Step Five

Go face to face the listing agent

The personal approach when you deliver your offer can go a long way towards swaying the competition for a home in your favor. Most buyers send offers via email these days, a rather impersonal approach, so presenting yours face-to-face can certainly make you, and your offer, stand out from the crowd.

The Bottom Line on How to Get your Dream Home

These five tips will greatly increase your chances of nailing down your dream home. If you could use a few more great tips on coming out the winner when you're buying a home, please feel free tocontact us. You can also check out The Ultimate Home Buyers Guide to learn more about all the steps it takes to buy a home. We're always happy to put our knowledge and experience to work for the benefit of New England home buyers.

June
17


Pet Move

The Pet Move

Moving with our fur babies can be tricky. Lots of unexpected activity and getting adjusted to a new place is hard on our pets. To make the pet move easier, here are some helpful tips that will create a successful and stress-free move. 

Plan Ahead for your Pet Move

A big part of any move is careful planning and preparation. When there's a pet in the mix, making sure you're ready before moving day becomes even more important. Be sure to take care of these details well in advance to ensure a smooth transition.

  • Research a new vet if you're moving far enough that your old one will be out of reach
  • Find out if your pet will need any new vaccinations upon relocation.
  • Get new collars and ID tags that reflect your new address, making certain that your cell phone number is on the collar. Micro-chipping isn't for everyone, but it's a good backup in case your pet loses its collar. 
  • Look into tags with tracking software in them such as the new Apple AirTag that can be attached to a collar, or there are many other options to pet tracking tags.
  • Check the local laws near your new home. Find out what the leash requirements are, whether you'll need to get a new license, and if there are any dog breed bans in place.
  • If you are moving somewhere that driving with your pet would be too far, there are pet relocation services that will move your pet for you in a safe and stress-free way. You could also consider taking your pet on an airplane if your pet meets the airline's guidelines.

Prepare Your Pet

In the days and weeks leading up to your move, there are lots of things you can do to get your pet ready and reduce stress. Pets are like children, we want to ensure they are well taken care of and they are kept happy during this stressful time.

  • If your new home isn't too far away, introduce your pet to it ahead of time. Even if it's just taking a walk to your new neighborhood, a little familiarity can be beneficial. 
  • Crate training your pet can help ease anxiety and it allows your pet to be more comfortable in the car when moving day arrives. To do this, it is best to gradually acclimate your pet to the crate well in advance to the move.
  • If your dog will need to learn new rules for your new location, start training in advance. Your dog may have to learn not to bark if you have close neighbors, could have to learn to be around other new animals, or may have to adapt to a smaller or larger home.  
  • Bring out a few boxes and suitcases weeks before the move, so your pet doesn't get too anxious during the packing process. 

Pet Move Day

  • The day you move to your new home can be a stress-filled roller coaster for everybody. Having a trusted pet with you can reduce your anxiety, so do everything you can to reduce their anxiety as well.
  • Prepare an "overnight kit" and keep it easily accessible, including enough supplies your pet may need to stay comfortable during the first few days of unpacking—dog food, kitty litter, toys, etc.
  • Depending on your pet's particular personality, it might be a good idea to send her to a trusted pet sitter's house for a day or two during the hustle and bustle of the move. 
  • When moving your pet, bring your pet in the car with you if possible, and make the trip as comfortable if you can. Put a blanket over the crate or pet carrier if that's what your pet needs, and keep food and toys handy. Don't let your pet out until you get to the new house unless it's a long trip that requires a bathroom break. 
  • During your pet move, positive reinforcement is key. Make sure your pet is receiving treats and love for all positive behavior to keep anxiety to a low.
  • Have a room set up for your pet with lots of familiar objects (and smells) that will remind her of your old house. 

Helping your pet adjust to their new home before the move, during the move, and after the move can exponentially help the move be more successful. The last thing anyone wants is themselves, along with their pets to put any strain when moving to a new home. If you follow these steps you should be well on your way to success.

Contact us today to learn more about finding your dream home and planning your move. We are committed to helping you, your family, and your furry friends. 

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