All posts by Martin

Buyer Agency Agreement

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I just had a friend who is seeking to make a purchase out of state ask me the following:

“…can I forward you some email correspondence I’m having with a Realtor. I like her, but if you can get me insider tips and tricks to get the property as cheap as I can, I’d love to hear them. I know that real estate is different in each state. I’d still appreciate your opinion on the situation though. Thanks!”

I know my friend was expecting a short answer but honestly there are no short answers to what my friend was asking me. However here is a good place to start and what follows is my response:

First off, an agent cannot give you any advice or opinions regarding a property unless you are in Buyer Agency Agreement with that agent. In the state of Wisconsin all agents (listing or otherwise) represent sellers by default, even if you are on a showing with that agent. In order for you to get true advice and opinions from an agent you will need to enter into a Buyer Agency Agreement with that salesperson.

Until you are in an agency agreement with an agent they are not your agent and you are not their client, you are a customer and they are a salesperson. Once you have signed an agency agreement contract (whether for listing a home to sell or making a purchase as a buyer) that salesperson has become your agent and you their client.

Some firms require that you enter into this agreement for a minimum amount of time and will charge you to end the contract early. At my firm there is no charge for entering into a Buyer Agency or terminating the Buyer Agency Agreement early. They can be executed for any duration of time or specifically for a specific property on a specific date and time. In the state of WI Buyer Agency fee’s are traditionally paid for by the seller at the time of close.

I would ask the agent about what their Buyer Agency agreement entails. Generally I would advise to enter Buyer Agency Agreement for a minimum of 3 – 6 months. Make sure you have the option to terminate the agreement at any time and at no cost for doing so, you never know what might happen in the future and you will want that as an option to utilize if the need arises.

A Buyer Agency Agreement is a “loyalty agreement” between you and the agent that allows an agent to negotiate on your behalf. Generally this means that you will not find another agent to look for properties in the same area that you have that agent looking in, nor will you have another agent look for properties that are comparable to the properties you have the agent representing you for. Also this means that the agent is going to bust their butt to help you find what you are looking for. Once you are in Buyer Agency agreement you will want to make certain to have your agent schedule all showings for properties of interest, do not contact listing agents directly from that point on.

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Now once you have found an agent and are in a Buyer Agency Agreement with them you’ll want to go on showings of properties that are of interest to you. Once you’ve found a few properties (or “THE ONE”) that you’d like to submit an offer on ask the agent to do a CMA (Cross Market Analysis) of the properties. Make sure the properties used in the CMA are as comparable to the listings you are interested in as possible, in that you want to compare APPLES TO APPLES, and specifically the same kind of apples not a cross section of honeycrisp, to granny smith, to braeburn.

A CMA provides you with what the Market Value is of a property. The CMA should compile data that represents current trends in the market too, generally no more than 6 months back (unless the market you are interested in doesn’t have enough data points to pull from, then you’d go back further as needed).

Don’t let Assessed value guide the offer price, ultimately its the Market Value that is king. Assessment value is for tax purposes, appraisals are for lenders, and market value is a compilation of the sold prices of comparable properties. Market Value is generally close to one or both of the appraisal and assessment numbers, but not always.

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When it comes time to submit an offer make sure to go in guns blazing ask for EVERYTHING you can in the first offer! That way if you enter a counter phase (and you likely will) you can appear more comprising and give the seller a sense that you are giving up more than they are. If you are going to lowball fine but keep it within 3-6% of the market value and do it out of the gate, ask for a closing cost credit towards buyer prepaids and closing costs (start high at say $3000.00). Implement contingencies such as a Finance Contingency, an Appraisal Contingency, and an Inspection Contingency. Use those 3 no matter what. Additional contingencies might be a Radon Contingency, Lead Based Paint Contingency, Mold Contingency, etc.

Contingencies are there as safety nets to give you the ability to legally and contractually back out of a deal should you need to.

There is more to Buyer Agency but this should get you started for now.

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2843 Westwood Dr, Janesville, Wisconsin

Congratulations to Ron & Terri on your accepted offer for 2843 Westwood Dr, Janesville, Wisconsin!

We flew in hot on this one.  When all was said and done our bid took home the gold over three others in a Multiple Counter Proposal situation!  With the right strategy implementation this home is now well on its way to two very wonderful and deserving people!

LCH MC Temp with MLS

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Accepted Offer for 71184 Cayuga Rd, Mellen WI

Congratulations to Nate and Tara on your Accepted Offer for 71184 Cayuga Rd, Mellen, WI!

An amazing find indeed.  This property is nearly 10 acres in size and is nestled against the Chequamegon-Nicolet National Forest.  The forest is a 1,530,647-acre U.S. National Forest in northern Wisconsin. Just a beautiful property in a fantastic area of the north woods of Ashland County!71184 Cayuga Rd

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210 W Church St Evansville Accepted Offer

Congratulations to Rick and Heather for your Accepted Offer of 210 W Church St  in Evansville!

MLS 210 W Church St Evansville

You made the right choices with updates.  You choices improved comfort, safety, and energy efficiency.  You did all this while still maintaining the charm of an older home.   I am sure the buyers will enjoy the modern amenities.  The tank-less water heater, HE front loading washer and dryer will save tons on energy costs.

The backyard will give them many rewards as well with the many fruiting plants  you planted such as strawberries, raspberries, and currants along with pear and apple trees. They will have plenty of space to play, relax, and entertain in their beautiful backyard.

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210 W Church St in Evansville, WI

Front
210 W Church St

Take a look at my new listing in Evansville, WI.  210 W Church Street is a cozy ready to move in home that is located in the Historic District of Evansville within easy walking distance of downtown and schools.

Living Room
Living Room

This freshly painted 2 bedroom 1.5 bathroom home is a must see for the value! The homes Greek Revival architecture provides great curb appeal!

Main level bathroom
Main level bathroom

The current owners have taken the time to make many updates to improve comfort, safety, and energy efficiency while

still maintaining the charm of an older home. You will enjoy modern amenities such as a tankless water heater, remodeled bathrooms, & 1st floor laundry with HE front loading washer and dryer.

The backyard is spacious and has wood privacy fencing. This home has mature maple trees and many fruiting plants such as raised beds full of strawberries, raspberries, and currants along with pear and apple trees. There is plenty of space to play, relax, and entertain in this beautiful backyard.

Evansville has a population of around 5000. The neighbords have a strong sense of community. Residents gather often for concerts, festivals, and celebrations. The City of Evansville has over 58 acres of park and recreation open space. Five neighborhood parks and Leonard Leota Park. In the heart of this park is Lake Leota, a 40-acre, stream-fed body of water for canoeing, (limited) motorized boating (electric motors only), fishing, and ice-skating.

The Wisconsin Historical Society has identified Evansville as home to “the finest collection of 1840s to 1915 architecture of any small town in Wisconsin.” Recent re-installation of the original brick paved Main Street is a signature revitalization project. Many downtown business owners have undertaken major building restorations, with several projects receiving historic preservation awards. Evansville has four gas stations, several banks, a full-sized grocery store, and several specialty shops and restaurants.

Please contact me at 608-335-8798 if you would like to see this charming home.

For more information on this listing click here:

210 W Church St Evansville, WI

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Open House in Waunakee February 8, 2015

Come to our open house in Waunakee on February 8, 2015 from 1:00 PM – 3:00 PM at 1701 Dunwoody Lane.  This is your opportunity to take a look at a wonderful  4 bedroom, 3.5 bath, custom built home in the beautiful community of Southbridge.

Attendees will be eligible to enter and win a free raffle drawing!

Click here for listing information

1701 Dunwoody Lane Front1701 Dunwoody specs copy For any questions about this listing, or any other properties of interest, contact me at martin@lakeandcityhomes.com or call me at 608-335-8798.

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Buying and Selling for 2015 Real Estate Market

House GraphBuying and Selling for 2015 Real Estate market is poised to be fast paced and full of action this year as median sale prices of U.S single – family homes and condos reached their highest levels since September 2008 this last October.  Listing season is knocking at our door and its time to get prepared for what opportunities await you if you are interested in buying or selling your home this season!

The bad news is that markets across the country are expected to slow to a home value growth of approximately 3 percent per year. This is down from the 6 percent home value growth per year we have been seeing recently. The good news is that median sale price of homes and condos are up, so for the majority of you looking to sell you are likely to do well listing your home in the present market.

With a market that is stabilizing and becoming much more balanced than what it has been for some time now buyers have something to look forward to as well.  A balanced market means that buyers who enter the market can expect to get a home for a fair market price (and sometimes better) as there will be more inventory to choose from.

Mortgage rates are down nearly 0.7% from this time last year according to a recent article at BankRate.com. This is great news for those of you who would like to sell your current home and acquire that home you’ve been dreaming about. You know the one with amenities like a screened in patio with an attached deck, a lower level walk-out, or larger lot with mature trees, maybe even a lakefront home!

With rates where they are now, first time home buyers can enjoy finally becoming a home owner and still meet their budgetary needs. For those who qualify, the Federal Housing Administration has lowered many of the associated costs regarding the mortgages they support. For example the premiums for FHA mortgage insurance are to be cut from 1.35% of a loan’s value to around 0.85%!

As you can see 2015 is primed and ready to please both seller and buyer alike. If you are looking to buy or sell a home remember that I am here to help. Click the big green button under “Questions? Ask me, I have answers” to contact me by phone or email.

Lets get started on the next chapter of your life today!

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Open House in Waunakee on January 25

Come to our open house in Waunakee on January 25, 2015 from 1:00 PM – 3:00 PM at 1701 Dunwoody Lane.  This is your opportunity to take a look at a wonderful  4 bedroom, 3.5 bath, custom built home in the beautiful community of Southbridge.

Click here for listing information

1701 Dunwoody Lane Front1701 Dunwoody specs copy For any questions about this listing, or any other properties of interest, contact me at martin@lakeandcityhomes.com or call me at 608-335-8798.

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Home Improvement Projects to Avoid

If you are thinking about selling your home this year, there are some home improvement projects to avoid.  I say this because they don’t add to the re-sale value of your home. I think home improvement projects can be a fun part of owning a home but do your homework.

Do it yourself, yes or no?
Do it yourself, yes or no?

First, map out a plan and a budget. Would you hire a professional or accumulate a little more sweat equity with “Do It Yourself” (DIY)?  There are pro’s and con’s to each option.  Hiring a contractor to complete a home improvement project is certainly going to cost more money than a DIY project.  The quality of work in most cases will be better than a DIY project. Make sure when you’re selecting a contractor you know they are reputable and you know they can perform the project to the level you’re expecting. Ask for testimonials from their existing clients.  My clients love that I have reliable and fantastic resources to help them. A good Realtor will always have an arsenal of resources.

DIY home improvements are normally more cost effective than hiring a professional.  Consider before tackling a DIY project whether or not you can complete the work and complete it properly.  Many potential home buyers can see sub-par job done from a mile away.  The last thing you want when selling your home is potential buyers thinking they are walking through the home of DIYer that cuts corners when doing improvements.

So, back to the question of which home improvement projects should you avoid if you plan to sell your home?

  • High end gourmet kitchens. I always say kitchens and bathrooms
    Gourmet Kitchen
    Gourmet Kitchen

    sell homes. There is no doubting that. However, depending on the level of a kitchen remodel, it can cost anywhere from a couple thousand dollars up to $50,000+.  Certainly a kitchen with custom cabinets, high end granite counter tops, expensive flooring, and high end appliances will “WOW” a potential buyer but it can also break your bank.  The cost of a high-end gourmet kitchen is the primary reason to avoid this home improvement project when considering resale value. If you plan on moving in a year or two, do not spend $50,000 on a kitchen remodel because you will not get it back nearly that amount of money back from resale.  Don’t completely avoid improving the kitchen though.  Instead of a high-end gourmet kitchen, here are some other kitchen improvements that can be made for less and still have a positive impact on resale value.  Updating light fixtures,  fresh neutral paint, resurfacing cabinets,  and possibly updating counter tops.

  • 3 season sun-room.  The cost of a sun room can be very high.  Of course it can be done cheaply, but you get what you pay for.  A top of the line sun room will cost in the ballpark of $30,000-$50,000, depending on size, amenities, and other factors.
    3 Season Sunroom

    The cost of an added sun room is usually not able to be recouped in a short period of time.  First of all, most sun rooms are unheated space, so they cannot be added to the total square footage of a home.  Certainly if it was to be added to the square footage of a home, it would have a much larger impact on the homes value.  There are certain additions that can be more beneficial like converting attic space into legal living space or converting an unfinished basement into legal living space.

  • Garage Addition. There are some potential buyers who will not look at a home that doesn’t have a garage. There are others who could care less about having a garage.  If you don’t have a garage, adding one is something that you should avoid when considering resale value.  The cost to build a garage will vary from contractor to contractor, however, it’s likely to fall between $20,000-$40,000. Let’s say for example it costs $20,000 to build a stand alone one car garage.  The addition of the one car garage, in most cases, is not going to add $20,000 in value of the home.  It’s possible it could add an additional $5,000-$10,000, but not $20,000.
  • Over personalized finishes.  One of the most important things to keep in mind when choosing a home improvement project and basing it on the resale value of your home is how to make it appeal to the masses.  While you may think it’s a great idea to install a floor with a bunch of pennies, the majority of buyers may think it is horrific. This would be a classic example of over personalizing during a home improvement and one that you should avoid.

Every homeowners situation is unique.  There are different reasons why one home owner may think a home improvement project is the best idea ever and why another may think it is the absolute worse. If you are unsure what a home improvement project that isn’t listed above will do to the value of your home, it’s suggested you consult with your local real estate professional.  Top real estate agents should be able to advise you on whether or not the project you’re thinking of completing is a good idea or if you should avoid it when considering resale value. If you don’t know a local Realtor, call or email me. I will be more than happy to help you!

 

 

 

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