One of the most common mistakes I see people make when buying a newly constructed home is them not having a professional home inspection. The comment I hear most is “why should I have a home inspections when everything is new” or “Isn’t it inspected by the city or county while it is being built.”
The answer is yes everything is new, and yes it is inspected at different stages by a plumbing inspector, insulation inspector, etc. However, these inspectors are looking for very specific items and sometimes they are on a very tight schedule or are so friendly with certain contractors, they do miss things and they are not looking for something outside of their specific inspection.
I strongly encourage all of my clients to have a home inspection. Some of the home inspections have uncovered things that are very simple and easily fixed, but could have caused significant, long-term damage had they not been taken cared of upfront. I have also seen home inspections on brand new homes that uncovered so many severe defects that I am not sure they could be remedied to a point where I would have been comfortable buying the home.
The cost of a home inspection is around $500 depending on the size of the home. In my mind this is cheap insurance.
A lot of builders require the sale of a new home be written on their own forms. Remember to have your agent write the home inspection clause into the contract. In most cases, the home inspection clause will not be included in the builder’s contract. (More to come on “Builder’s Forms” in a later blog.) There is specific language that should be used and written correctly. A good, reputable builder shouldn’t have an issue with a home inspection clause.
Another comment I hear for not having a home inspection is “isn’t there a state-mandated one or two-year warranty on new construction homes.” DON’T COUNT ON IT!
Next blog: The Home Warranty Myth!
Thursday, June 26, 2008
Wednesday, June 25, 2008
Fed Rates Unchanged; May Increase in Fall
WASHINGTON (AP) -- The Federal Reserve decided on Wednesday to leave a key interest rate unchanged and cited a heightened risk of inflation, which could lead to rate increases down the road. Private analysts said the Fed may delay the first rate hike until December.
"They reaffirmed that there will be no further rate cuts and the next change will be a rate increase, but I didn't see any special urgency about how soon that rate increase will take place," said David Jones, chief economist at DMJ Advisors.
Jones said based on this statement it is likely that the Fed will keep rates unchanged until the December meeting while other analysts said they were not looking for any rate changes at least until the fall.
Please see more information about the story:
"They reaffirmed that there will be no further rate cuts and the next change will be a rate increase, but I didn't see any special urgency about how soon that rate increase will take place," said David Jones, chief economist at DMJ Advisors.
Jones said based on this statement it is likely that the Fed will keep rates unchanged until the December meeting while other analysts said they were not looking for any rate changes at least until the fall.
Please see more information about the story:
Friday, April 25, 2008
Recent "Ignore the Headlines" Article from TIME Magazine
WAITING TO BUY A HOME NOW MAY NOT BE IN YOUR “BEST INTEREST.”
If you are undecided on whether or not to pull the trigger on buying a new house, please take five minutes to read the article found here, “Ignore the Headlines” by Dan Kadlec for Time magazine. I concur with the author’s conclusion that it is an ideal time to buy before:
· Interest rates start going up
· Homes prices begin to level out;
· Sellers become less amenable to negotiating price and terms; and the worst part of all,
· You remain longer in a house you’d rather not be in...
Most people buy based on monthly house payments, but if the interest rate rises, more of the payment goes to interest and less to the cost of the actual house. Even if the price of the house goes down, if the interest rate goes up, you actually get less house by waiting.
Normally when the market softens, the interest rate raises, so this could be the perfect storm for buyers--you have a softening market which means better prices, more homes to choose from, more room to negotiate, and historically lower interest rates. If you were thinking of buying or moving up you should take a hard look at this information.
To see the full article, please visit: here.
If you are undecided on whether or not to pull the trigger on buying a new house, please take five minutes to read the article found here, “Ignore the Headlines” by Dan Kadlec for Time magazine. I concur with the author’s conclusion that it is an ideal time to buy before:
· Interest rates start going up
· Homes prices begin to level out;
· Sellers become less amenable to negotiating price and terms; and the worst part of all,
· You remain longer in a house you’d rather not be in...
Most people buy based on monthly house payments, but if the interest rate rises, more of the payment goes to interest and less to the cost of the actual house. Even if the price of the house goes down, if the interest rate goes up, you actually get less house by waiting.
Normally when the market softens, the interest rate raises, so this could be the perfect storm for buyers--you have a softening market which means better prices, more homes to choose from, more room to negotiate, and historically lower interest rates. If you were thinking of buying or moving up you should take a hard look at this information.
To see the full article, please visit: here.
Monday, January 28, 2008
Market Bust or Market Boon?
Contrary to most news stories, there is an awesome opportunity in the real estate market right now. The CAP item this month has some national numbers which are very interesting and probably something you won’t see in the news.
Our local story is even better. Right now in Portland, there are a number of circumstances that have aligned to make this an “awesome” opportunity especially for a particular segment.
Portland-area market conditions include:
Interest rates are in the mid-5 percent range…the best in years.
Homebuilders have overbuilt in specific areas and price ranges.
Our local economy is doing well.
There is a minimum supply of homes in the entry to lower-midrange in price.
What does this mean for you? If you are selling a home in the entry-to-mid price range and are planning on moving up, you have the best opportunity of all. You should be able to get top dollar for your home and if you move up, there are more houses to choose from and more negotiating room than there has been in decades. The more someone moves up, the more dramatic the opportunity is.
This is a much better market than even the “Red Hot Market” a couple of years ago. Back then it was great if you were selling and moving away or not going to purchase another home. If you were moving up or buying any home in Portland, you would have to compete with a number of other buyers for the same house sometimes paying more than the asking price. You won when you sold, but were on the losing end when you were the buyer.
In today’s market, you can win when you sell as well as when you buy. This type of market is very rare and doesn’t happen in the industry very often.
If you think this might be you, give me a call and I can run the specific scenarios for your situation and show you how best to take advantage of this opportunity.
Best regards,
Nick Rossi, P.C.
PS: If this sounds like something a friend or loved one should take advantage of, I would love to show them how it would work for them. Call me with their number or share my information with them!
Our local story is even better. Right now in Portland, there are a number of circumstances that have aligned to make this an “awesome” opportunity especially for a particular segment.
Portland-area market conditions include:
Interest rates are in the mid-5 percent range…the best in years.
Homebuilders have overbuilt in specific areas and price ranges.
Our local economy is doing well.
There is a minimum supply of homes in the entry to lower-midrange in price.
What does this mean for you? If you are selling a home in the entry-to-mid price range and are planning on moving up, you have the best opportunity of all. You should be able to get top dollar for your home and if you move up, there are more houses to choose from and more negotiating room than there has been in decades. The more someone moves up, the more dramatic the opportunity is.
This is a much better market than even the “Red Hot Market” a couple of years ago. Back then it was great if you were selling and moving away or not going to purchase another home. If you were moving up or buying any home in Portland, you would have to compete with a number of other buyers for the same house sometimes paying more than the asking price. You won when you sold, but were on the losing end when you were the buyer.
In today’s market, you can win when you sell as well as when you buy. This type of market is very rare and doesn’t happen in the industry very often.
If you think this might be you, give me a call and I can run the specific scenarios for your situation and show you how best to take advantage of this opportunity.
Best regards,
Nick Rossi, P.C.
PS: If this sounds like something a friend or loved one should take advantage of, I would love to show them how it would work for them. Call me with their number or share my information with them!
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