Real Estate Blog – Condotron

If you are planning to buy a condo unit, you might was well learn the monthly fees that your building admin will charge. Think how these fees plus your mortgage payments and property taxes can cause a big dent on your monthly budget.

Maintenance Fee

The maintenance fees are actually your share of maintaining the building. This will not be profitable for the management since most of the buildings are registered as non-profit corporations. Most of the fees will help cover for the cost of window cleaning, garden maintenance, house cleaning, snow shoveling, among others.

Your fees will be calculated depending on the size of your unit and will be recalculated every year depending on the operating budget of the building.

Contingency Funds

A portion of the fees will also be allocated to a contingency fund that will cover for other major building maintenance such as for plumbing, roof, or heating system repairs. If you will compare condo fees to townhouse fees, the latter is easier to handle considering their utilities are metered separately.

Some condos may ask for higher fees as they have concierge services, beefed-up security, pool, gym with available trainers, or underground parking.

Special Assessments

These are fees that will cover for other major repairs that may not be covered by the contingency fees. Once they are collected, you might see a significant drop in your monthly maintenance fees.

You need to make sure that you are aware of the monthly fees that you need to pay before purchasing a condo. This will allow you to compare your choices and determine which features and amenities will you really need and whether your budget can handle these fees or not.

Burglaries are rampant in this gloomy economy. Homeowners must do all means to keep their home safe when you decide to travel for a holiday. There are simple steps you can follow to make sure you will not be going back to an empty house after your holiday:

Home insurance

An empty house is a screaming invitation for burglars to celebrate. If you are going away for quite sometime you need to make sure your insurance company knows about it and that it should be clear that you are not violating any of your policy’s terms. Make sure you meet all their security requirements or you will not be covered in case any untoward incident happens.

Deliveries

Tell regular delivery services such newspaper and milk to temporarily stop the delivery while you are on a holiday. You do not want these things piling up your doorway. You can also ask a friend or a neighbor to check and clear your door step for mails or deliveries.

Exterior

Tidy up the porch and the garden before going on a holiday. You can also move items like bikes and other expensive items inside the house. You can also ask a relative to mow your lawn and water the plants since long grass and dried plants are telling the bad guys that you are not home.

Interior

Make sure the gas and water lines are tightly closed. Make sure to lock all the windows and close all the curtains. You can also use a timer device to turn on and off your lights on a regular basis, or you can ask a friendly neighbor to do this for you while you are away.

Locks

Make sure you make use of quality locks to seal your home off. You can also install window locks at the ground floor just for added protection.

A lot of condominiums offer a host of attractive benefits to prospect buyers. Here are some good reasons why you should buy a condo:

Amenities

Developers of condominiums often give access to certain amenities that in normal conditions will not be affordable to the buyers. You might have access to golf courses, clubhouses, swimming pools, fitness facilities, and other things made affordable to a group of owners who share the costs.

Desirable location

Single homes along the beach front or in a ski town might be out of reach in terms of price but owning a condominium in these locations is a feasible alternative.

Tax advantages and building equity

Condo ownership gives several benefits over just renting a unit. You will have the opportunity to accumulate some equity and be able to take advantage of tax deductions for property taxes and mortgage interest. If you will be paying almost the same amount to rent a condo unit as to buying, then purchase the property to take full advantage.

Investment

A lot of buyers also get condo units as a form of investment. Some foresee that the properties in the area will have higher prices in the future or they want to have it as a rental property. Condos appreciate in value slower than single homes so a lot of owners tend to put it up for rent to recoup their expenses over time.

Maintenance

Owners of condominiums are not directly responsible for doing maintenance on the building, grounds, or its common areas. This is a very desirable perk especially for the busy ones. There are fees that cover these tasks.

Whether you are buying or selling home, the process is quite long and tedious. Along this process, you might find out that your working relationship with the real estate agent is not doing you any good. Maybe the real estate agent does not listen to you or making moves that are not in line with your plans. Or maybe you are just not comfortable with each other. If you want to break up with the real estate agent, here are some tips:

Buyers

Agents will be making some commission if they are able to convince you to seal the deal for a certain property. Usually, as a buyer you are not obliged to go into a financial or contractual agreement with an agent. There will be agents though that may ask you to work with them exclusively.

If you are not ready to be tied down with exclusivity agreements, you will be better off not to handshake with such agents. You might be a year or a few months prior to to buying a home and you just want information and know the details but there will be agents who will be pressing you to buy a certain property. Do your homework and be firm with your gameplan. You just need to be honest with an agent if you do not like what they are doing and give them some feedback.

Sellers

As a seller, you are required to sign documents with the brokerage firm. Just like buyers, you need to do homework. You should review the contract well. Remember that you can say no to showings or open houses. You should also not be required to sign anything with any buyer. As the seller, you should be in power.

Any good agent will release you from any obligation if you are not happy with his or her services. There will also be times when an agent might ask to be from your agreement especially when you insist to keep the price of the property way too high. Remember that any contract can be terminated with mutual consent.

When you own a single home, the home insurance you will get covers for the structure as well as personal belongings inside the house such as computers, clothes, furniture among others. The scenario is different when you have a condo, the insurance policy only covers the structure and not what is inside your condo unit.

If you are purchasing a condo, make sure you also get an insurance policy that will protect your personal properties inside your home. These insurance policies which protects the content of your condo are not expensive coverages and can prevent loss of your possessions.

Typically you need a content insurance which is about one fifth of the value of your condo. Say your condo unit is worth $400,000 then you need a content insurance of around $80,000. There might be a need for some liability policy to come with the coverage.

Know the requirements

You need to coordinate with your condo association if they require certain policies for owners. Depending on their bylaws, condo associations might impose a certain amount of coverage for individual condo owners. This may apply for other insurance policies they may require as well. Before purchasing an insurance, make sure you or your lawyer checks with the condo board because you need to abide by them.

Flood Zone

If you are in a flood zone, you also need a flood insurance. There are certain states though that require every homeowner to have a flood insurance regardless if they are in a low or high risk area.

When you have come to that decision that you will be selling your home, you need to decide next whether you will be selling it yourself or will you be using the services of a real estate agent. Let us weight the pros and cons:

Real estate agent

The agent will be asking for a commission if they sell your home. This boils down to giving them around 3% to 6% of the sale. It could be a big amount to handle especially if your home is around the $500,000 price range.

Real estate agents though know the ins and outs of the market. They have access to different resources which you do not have. They also have a good list of serious clients seeking to buy properties.

An agent can inject some objectivity into the selling process and guide you to see it in a right perspective. Their professional experience and opinion can help you price your home appropriately. Aside from the guidance, they will do all the footwork for the legal aspects of the home selling process.

For Sale By Owner

If you will be selling your home yourself, you need to consider a lot of things. First, a lot of buyers veer away from homes being sold by owners since they want to avoid any problems transacting with amateurs. You will also be prone to aggressive negotiations since the potential buyers know that you will not be paying any agent a commission. It takes some guts to sell your own home.

If you will be selling your own home, make sure that you do your homework well. You can tap services too like learning resources to know the basics of selling or advertising your property on a website. Once you put your home up for sale, it will be a product buyers want to examine inch by inch. Screen visitors that you will entertain, and get relevant information for your safety. Be ready to show people around your place by hosting an open house every weekend or as your schedule permits.

One of the most respected men in business gives home buyers some tips to adapt to the changing landscape of the real estate market. We can surely learn a lot of lessons from this tips coming straight from billionaire and philanthropist, Warren Buffett:

Smart way of owning a home

As a homebuyer you need to thin of three things: long term ownership, affordable monthly payments, and fixed mortgage. Buffett was asked how his holding for manufactured housing has done well in the rough market. The business guru shared that they focused on realistic down payment and opted for manageable fixed monthly installments based on the buyer’s income. These elements blended well so people can keep their home unlike other schemes which led to foreclosures and the mortgage bubble burst.

Your dream home may lead to a nightmare

Buffett also cautions homebuyers that trying to purchase your dream home that will have a very high monthly with an adjustable rate mortgage may mean a dream that leads to a bad ending. Warren Buffett explains that a dream house can be a terrible nightmare when the buyer is looking way beyond what his wallet can manage and when a lender gives into the fantasy of the buyer.

Homes will increase in value is still true

Buffett was invited in in Congress for an interview and for him to share his thoughts about the mortgage bubble burst. He said that the “liar loans” led to the economic crash because lenders and borrowers corrupted the basic premise of how prices of homes will go up and that it will never go down. Lenders allowed unqualified buyers to get homes or multiple properties which are way beyond what their bank account can handle.

Now that we have talked a little bit about why home inspections are very important, the next step is going to be is making sure that you choose a home inspector that knows exactly what they are doing.  This is where your research is going to have to come in, for you are going to have to research the home inspector before you choose one.

You want someone that is going to be extremely qualified, experienced and of course professional.  You want to make sure that the home inspector does have testimonials from other clients that they have serviced, that way you know that you are getting a good inspector.

Finding the right home inspector can be difficult, however it is definitely necessary and certainly something that you should take caution whenever you are choosing!

Whenever you are purchasing a home, there are quite a number of things that you are going to want to make sure that you take into consideration and one of them is a home inspection.  While most people do not ever think about home inspections or getting their homes inspected before they buy them, it is actually a fantastic idea to do it.

In the next couple blogs, we are going to explore and look into home inspections and just why they might be a benefit to you.  For one, you want to keep in mind that whenever you get a home inspection, you know that the home you are getting into is going to be an investment – because the home inspector will tell you.

Stay tuned for the next blog, where we will talk about the home inspection process and what to look for in a home inspector!

Now that we have touched on why buying a bank-owned home might not be the best idea in the world, let’s move onto another reason why and that is the down payment.  Typically, when you purchase a home, that is something that you can talk about and it is typically like 5 to 10% down, however if you are buying a bank-owned home it is usually 20-25% down.

This is money right off the bat for a home that you do not know if it needs repairs.  Is it worth it?  To me, it is not.  Only because I think that there are is a lot of other options and I think that home owners are flexible with their price and if you give them a fair price they will give you a fair deal.

Keep this in mind whenever you are out looking for a home – I can promise that if you rush into the decision you will regret it.