Ray Mikus

Buyers: Here's What To Expect At The Inspection

 

Buyers: Here's What To Expect At The Inspection

 

Congratulations! You’ve done it! You found your house, you made a solid offer, and you won the contract. 

 

Photo by Tierra Mallorca

 

Now, it’s time to really focus on the inspection.

As a buyer, you may have gone through the inspection process before, but it never hurts for a refresher. And if you’re a first time buyer, you definitely need to know what to expect.

1. The‌ ‌inspector‌ ‌is‌ ‌going‌ ‌to‌ ‌go‌ ‌over‌ ‌everything‌ ‌about‌ ‌the‌ ‌house--the‌ ‌roof,‌ ‌the‌ ‌attic,‌ ‌the‌ ‌electric,‌ ‌the‌ ‌plumbing,‌ ‌the‌ ‌windows,‌ ‌the‌ ‌basement,‌ ‌the‌ ‌heating‌ ‌system,‌ ‌and‌ ‌more.‌ ‌Everything.‌ ‌It’s‌ ‌a‌ ‌great‌ ‌opportunity‌ ‌to‌ ‌really‌ ‌get‌ ‌to‌ ‌know‌ ‌the‌ ‌house‌ ‌you’re‌ ‌buying.‌ ‌And‌ ‌it’s‌ ‌a‌ ‌great‌ ‌opportunity‌ ‌to‌ ‌ask‌ ‌questions‌ ‌from‌ ‌a‌ ‌professional.‌ ‌

2. Plan‌ ‌on‌ ‌it‌ ‌taking‌ ‌three‌ ‌hours.‌ ‌Smaller‌ ‌houses‌ ‌may‌ ‌take‌ ‌less‌ ‌time.‌ ‌And‌ ‌houses‌ ‌that‌ ‌are‌ ‌in‌ ‌really‌ ‌good‌ ‌condition‌ ‌tend‌ ‌to‌ ‌take‌ ‌less‌ ‌time.‌ ‌But‌ ‌still,‌ ‌plan‌ ‌on‌ ‌three‌ ‌hours.‌ ‌Maybe‌ ‌even‌ ‌bring‌ ‌a‌ ‌snack!‌ ‌

3. Some‌ ‌of‌ ‌the‌ ‌inspection‌ ‌is‌ ‌outside,‌ ‌and‌ ‌a‌ ‌lot‌ ‌of‌ ‌it‌ ‌is‌ ‌in‌ ‌the‌ ‌basement.‌ ‌Wear‌ ‌appropriate‌ ‌footwear‌ ‌and‌ ‌clothes.‌ ‌Also,‌ ‌it‌ ‌never‌ ‌hurts‌ ‌to‌ ‌bring‌ ‌a‌ ‌flashlight.‌ ‌

4. Write‌ ‌down‌ ‌specific‌ ‌areas‌ ‌of‌ ‌concern‌ ‌beforehand.‌ ‌Even‌ ‌better,‌ ‌talk‌ ‌with‌ ‌your‌ ‌Green‌ ‌Light‌ ‌Real‌ ‌Estate‌ ‌agent,‌ ‌and‌ ‌put‌ ‌a‌ ‌list‌ ‌together.‌ ‌That‌ ‌way‌ ‌you‌ ‌won’t‌ ‌forget‌ ‌what‌ ‌you‌ ‌really‌ ‌wanted‌ ‌to‌ ‌ask.‌ ‌

5. Much‌ ‌of‌ ‌what‌ ‌you’ll‌ ‌hear‌ ‌during‌ ‌the‌ ‌inspection‌ ‌are‌ ‌“problems”.‌ ‌That’s‌ ‌completely‌ ‌normal,‌ ‌inspectors‌ ‌have‌ ‌a‌ ‌tendency‌ ‌to‌ ‌focus‌ ‌on‌ ‌things‌ ‌that‌ ‌aren’t‌ ‌perfect.‌ ‌Don’t‌ ‌freak‌ ‌out!‌ ‌

6. And,‌ ‌when‌ ‌you‌ ‌get‌ ‌your‌ ‌report,‌ ‌usually‌ ‌in‌ ‌2-3‌ ‌days,‌ ‌also‌ ‌don’t‌ ‌freak‌ ‌out.‌ ‌The‌ ‌report‌ ‌will‌ ‌have‌ ‌dozens‌ ‌to‌ ‌hundreds‌ ‌of‌ ‌photos,‌ ‌and‌ ‌can‌ ‌be‌ ‌100‌ ‌pages‌ ‌long‌ ‌or‌ ‌longer.‌ ‌They’re‌ ‌thorough.‌ ‌But‌ ‌stay‌ ‌calm.‌ ‌There’s‌ ‌rarely‌ ‌anything‌ ‌in‌ ‌the‌ ‌report‌ ‌that‌ ‌you‌ ‌didn’t‌ ‌see‌ ‌at‌ ‌the‌ ‌actual‌ ‌inspection.‌ ‌

7. You’re‌ ‌the‌ ‌only‌ ‌person‌ ‌who‌ ‌gets‌ ‌the‌ ‌report.‌ ‌The‌ ‌seller‌ ‌doesn’t‌ ‌get‌ ‌it.‌ ‌

8. After‌ ‌you‌ ‌have‌ ‌the‌ ‌report,‌ ‌there‌ ‌may‌ ‌be‌ ‌some‌ ‌re-negotiation‌ ‌with‌ ‌the‌ ‌seller.‌ ‌There’s‌ ‌nothing‌ ‌that‌ ‌the‌ ‌seller‌ ‌‌has‌‌ ‌to‌ ‌do.‌ ‌But‌ ‌if‌ ‌there‌ ‌are‌ ‌items‌ ‌that‌ ‌came‌ ‌up‌ ‌that‌ ‌were‌ ‌surprises,‌ ‌then‌ ‌it’s‌ ‌common‌ ‌for‌ ‌buyers‌ ‌to‌ ‌ask‌ ‌sellers‌ ‌to‌ ‌make‌ ‌minor‌ ‌repairs‌ ‌or‌ ‌concessions.‌ ‌Remember,‌ ‌that‌ ‌if‌ ‌it’s‌ ‌a‌ ‌hot‌ ‌market,‌ ‌and‌ ‌properties‌ ‌are‌ ‌selling‌ ‌fast,‌ ‌you‌ ‌might‌ ‌have‌ ‌less‌ ‌leverage‌ ‌as‌ ‌a‌ ‌buyer‌ ‌than‌ ‌in‌ ‌a‌ ‌slow‌ ‌market.‌ ‌ ‌

9. Sometimes‌ ‌inspectors‌ ‌recommend‌ ‌bringing‌ ‌in‌ ‌additional‌ ‌professionals.‌ ‌Your‌ ‌Green‌ ‌Light‌ ‌Real‌ ‌Estate‌ ‌agent‌ ‌may‌ ‌have‌ ‌already‌ ‌talked‌ ‌with‌ ‌you‌ ‌about‌ ‌this.‌ ‌If‌ ‌the‌ ‌boiler‌ ‌looks‌ ‌really‌ ‌old,‌ ‌then‌ ‌you‌ ‌don’t‌ ‌need‌ ‌an‌ ‌inspector‌ ‌to‌ ‌tell‌ ‌you‌ ‌to‌ ‌have‌ ‌it‌ ‌investigated‌ ‌by‌ ‌a‌ ‌heating‌ ‌contractor.‌ ‌

10. Inspectors‌ ‌won’t‌ ‌usually‌ ‌give‌ ‌estimates‌ ‌for‌ ‌repairs.‌ ‌However,‌ ‌we‌ ‌know‌ ‌from‌ ‌experience‌ ‌what‌ ‌a‌ ‌lot‌ ‌of‌ ‌the‌ ‌more‌ ‌common‌ ‌repairs‌ ‌cost.‌ ‌And‌ ‌we‌ ‌can‌ ‌always‌ ‌get,‌ ‌or‌ ‌help‌ ‌get‌ ‌estimates.‌ ‌

11. If‌ ‌the‌ ‌house‌ ‌doesn’t‌ ‌have‌ ‌any‌ ‌surprises,‌ ‌it’s‌ ‌ok‌ ‌to‌ ‌simply‌ ‌accept‌ ‌it‌ ‌as‌ ‌is,‌ ‌and‌ ‌move‌ ‌forward.‌ ‌There’s‌ ‌no‌ ‌such‌ ‌thing‌ ‌as‌ ‌a‌ ‌perfect‌ ‌house.‌ ‌Just‌ ‌like‌ ‌there’s‌ ‌no‌ ‌perfect‌ ‌car‌ ‌or‌ ‌no‌ ‌perfect‌ ‌job.‌ ‌At‌ ‌Green‌ ‌Light,‌ ‌we’ve‌ ‌been‌ ‌on‌ ‌hundreds‌ ‌of‌ ‌inspections.‌ ‌Something‌ ‌‌always‌ ‌comes‌ ‌up.‌ ‌But‌ ‌they‌ ‌usually‌ ‌aren’t‌ ‌deal‌ ‌killers.‌

 

We’re‌ ‌here‌ ‌to‌ ‌help‌ ‌point‌ ‌out‌ ‌what’s‌ ‌really‌ important, what you can probably live with, and what’s not a big deal at all. Remember, the goal is to get you into the house that you love, and protecting you along the way.

 

Call 802-225-6425 and speak with any of our awesome agents and brokers

Or email Info@GreenLight-RealEstate.com.

You can also follow us on FacebookInstagram or check out our listings on www.GreenLight-RealEstate.com

 

Can't get enough? We get it, that's why we also made this easy to digest Youtube video on the topic. Enjoy!

 

 

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    Out of State Lenders and Title Companies

    Out of State Lenders and Title Companies

    It’s great to have choices. But sometimes there are too many, and it makes making good choices hard. Here’s an example of what happens when you try to save a buck.

     

    We had a property listed for sale in Barre. When the offer came in, we negotiated, worked through the inspection, appraisal, everything. Honestly, it was a pretty straightforward transaction for the first month of escrow.

    But...the buyer (not our customer) chose to work with an out of state lender, and an out of state title company. That’s where things got complicated.

    The lender and the title company couldn’t, or wouldn’t, communicate with each other. They both sent emails to the buyer’s Realtor and to me saying that they couldn’t reach the other. That made zero sense, but it led to many delays.

    After a few emails where we were told “We just need this one more thing…” everything looked ready to close. But the title company wouldn’t schedule a closing date. Days passed. A week passed, and neither the lender nor the title company would agree to a closing date.

    Then, magically, we got an email that we were closing on Friday. This was on Tuesday. So, in three days, all the documents had to  be prepped, prorations calculated, documents reviewed, travel arrangements made, clean out of the house completed, and more. (My daughters and I spent a Friday evening cleaning out the basement and throwing things away.)

    Josephine and Willoughby helping clean out the basement on a lovely Friday evening.

     

    Since it was an out of state operation, and since we’re doing remote closings these days, we had to figure out the logistics of signing. The seller side, which was Green Light Real Estate, had things lined up, documents signed, power of attorney in place. The title company never told the buyer how much he needed to bring to closing, or that it needed to be in a cashiers check. They didn’t give any instructions to the notary public they hired to oversee signatures.

    Since instructions hadn’t been given, the buyer showed up without funds. We worked for three hours with an out of state deposit institution, and out of state lender to get funds transferred by wire. That turned out to be an impossibility. 

     

    Closing started 15 minutes ago...but I was the only one here.

     

    Closing was delayed, and the buyer couldn’t move in until Monday. I’m not sure if the buyer saved any money on fees. He probably didn’t. But he did get to pay for a weekend of hotel, additional missed time from work, additional fees for moving, and massive stress.

    I’m not saying that things always go perfectly smoothly with local lenders, but having a three hour closing and still not closing for two more days created a huge problem for the buyers. With a local lender, we could have talked with an actual person we know, and sort out problems. A local attorney would have known how to handle the situation, and not put everything in crisis mode.

     

    So please, please...make things easier on yourself when you’re buying or selling real estate in Central Vermont. Use a local lender. Use a local attorney.

     

    Call Green Light Real Estate at 802-225-6425 and speak with any of our awesome agents and brokers

    Or email Info@GreenLight-RealEstate.com.

    You can also follow us on FacebookInstagram or check out our listings on www.GreenLight-RealEstate.com

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      How Does 2020 Stack Up?

      How Does 2020 Stack Up?

      The last few months have been, shall we say, unusual.

      Let's see how 2020 compares to years past.

       

      Photo by Francesca Tosolini

       

      Why does it seem like the market is so hot? Because it is. The number of new listings is way down. But the number of houses that have gone under contract is way up. Supply and demand!

       

      Side note: Hey Sellers! We have been hired by MANY buyers to help them buy a house. Call us, and we can play matchmaker.

       

      Almost all of that shortage in new listings has taken place in April and May:

       

       

      And, almost all of the runup in houses getting into contract has taken place May 1-June 15:

       

       

      You're not going crazy. It's a REALLY tight market right now in Central Vermont. The best thing to do is to get an expert from Green Light Real Estate to help you find, negotiate, and buy in this market. And don't worry, should you get stuck in a multi-bid situation as a result of this hot market, we've got your back.

       

      Call our office at 802-225-6425, email Info@GreenLight-RealEstate.com or get in touch with any of our awesome agents and brokers

      You can also follow us on FacebookInstagram and check out our listings on www.GreenLight-RealEstate.com

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        How to Win a Multi-Bid Situation

        How to Win a Multi-Bid Situation

        When the market is hot, which it is right now, buyers have to have a few extra tricks up their sleeves to get the house they want.

        Photo by Scott Graham

         

        Here are some good strategies to use to help when you’re in a good old fashioned bidding war:

         

        • Be prepared! Have your pre-approval letter in place. You can even get a couple letters, say in $25,000 increments. Then you can give whichever one makes the most sense with your offer. Also, it can help to be working with a local bank. Many sellers and listing agents would prefer to be working with a lender they actually know and not a cog in a wheel in a massive lending operation in Michigan or Texas (and yes, I’m talking about you--Quicken and USAA).

         

        • Come strong and come hard. Make your best offer, knowing that you may have to pay above the asking price. When you go on a first date, do you dress up and plan just enough to keep someone interested? Or do you go above and beyond? This not the time to do the bare minimum.

         

        • Reign in those contingencies. In a multi-bid situation, the fewer contingencies, the better your offer looks. You don’t have to get rid of the inspection contingency, but you could limit it in terms of the items to be “contingent”, a dollar figure, shortening the time frame, or more. 

         

        **Bonus tip! Don’t think that you’ll be able to do significant post-inspection negotiations. If there were three offers, it’s pretty likely that the other two are still looking for a house.**

         

        • Write a love letter. Hey, it helps sometimes. Tell the seller what you love about their house, and a little about yourself.

         

        • Show them the money. Make a big deposit. Or, make it non-refundable at a certain point. Or, how about sharing your credit score, your employment history, even some of your financial records with the sellers so they know that you’re able to buy their house. For that matter, give them your resume. They’ll get to know you. And maybe that professional network will help you.

         

        • Use an escalation clause. Promise to pay more than another offer. Best to talk this strategy with your Green Light Real Estate agent, because sometimes this confuses sellers and sellers’ agents. It’s not really that complicated, but still.

         

        • And the best...don’t have a bidding war! Your agent can just call the sellers’ agent and ask “Hey, these people want to buy the house. What will it take for the sellers go with them?” Honestly, it might be another $5000, or that the seller gets to leave the basement furniture. Big deal! If you get into a bidding war, you’re easily paying that much more anyway. Plus that bidding war is a zillion times more stressful.

         

        These are just a few ways to help buyers get the house in a hot market.

         

        For more details, more strategies, and more ways to make sure that you get your house,

        call 802-225-6425 and speak with any of our awesome agents and brokers

        Or email Info@GreenLight-RealEstate.com.

        You can also follow us on FacebookInstagram or check out our listings on www.GreenLight-RealEstate.com

         

        Can't get enough of this multi-bid info? We get it, that's why we also made this easy to digest Youtube video on the topic. Enjoy!

         

         

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          Mortgage Help: Fannie and Forbearance

          Mortgage Help: Fannie Mae and Forbearance

           

          There is no denying that the slowdown / shutdown from COVID-19 is goinig to have very real impacts on people's finances. Loss of income and drawing down of savings may make it challenging for some to make their mortgage payments. And for others, who are at risk for foreclosure, the fears can be even greater right now.

           

          Here's a link to Fannie's website with the hows and whats of mortgage forbearance.

           

          Fannie Mae has made it possible to get some help with paying your mortgage. No, they won't pay it for you, but you may be able to postpone payments for up to 12 months. You actually have to be proactive to use this resource.

           

          Here's a link to more information and directions on what you need to do.

           

          The gist is that if, due to economic hardships related to COVID-19, you may be able to delay making mortgage payments, and that might really take a lot of stress out of an otherwise stressful time.

           

          Have further questions? Feel free to contact us via email at info@GreenLight-RealEstate.com or via phone at 802-225-6425.

           

          From all of us at Green Light Real Estate,

          be well, stay safe, and take care of those around you.

          We're getting through this together.

           

          Follow us on Facebook, Instagram or check out our listings on www.GreenLight-RealEstate.com

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            COVID-19 and Foreclosures

            COVID-19 and Foreclosures

             

            It's always been true that one of the leading causes of foreclosure is getting sick. Another leading cause is losing one's job. 

             

            Combining a pandemic with an economic shutdown can cause massive strain on a family's financial position. And adding the fear of losing your house to foreclosure in the midst of all of it might just be too much.

             

            To help, Fannie Mae has made changes in how foreclosures are being handled: They're being paused for 60 days. We're not completely sure what the economy will be like in 60 days (for the country or for any individual household), but this can at least give some temporary assurance that people aren't going to be kicked out of their homes.

             

            Here's a link to more information and details from Fannie Mae.

             

            This doesn't mean that you don't have to pay the mortgage eventually, or that if you're on the path to foreclosure during those 60 days that foreclosure proceedings won't pick back up.

             

            If you think you're on the path to being foreclosed, PLEASE contact Green Light Real Estate. There may be things that can be done to help. Maybe your house is worth more than you think. Maybe there is a buyer who could move quickly with the price you need. Maybe your house is a good candidate for a short sale. We help people in situations like this all the time. You just have to ASK. And, maybe there isn't anything that can be done. Maybe the house is going to be foreclosed on. But you'll at least have done everything you could.

            You can contact us via email at info@GreenLight-RealEstate.com or via phone at 802-225-6425.

             

            From all of us at Green Light Real Estate,

            take care of yourself and those around you.

            We're getting through this together.

             

             Follow us on Facebook, Instagram or check out our listings on www.GreenLight-RealEstate.com

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              Workaround for COVID-19

               

              Fannie and Freddie Give Appraisers

              a Workaround for COVID-19

               

              In a move to help move purchases, sales, and refinances through the system, Fannie Mae and Freddie Mac have issued new options for appraisers. Here's a video explaining some of the workarounds:

               

               

               

              Typically, appraisers would need to do an interior and exterior inspection of the house that's being bought or refinanced. The new rules allow for exterior only inspections so that appraisers don't need to go inside the house. The inspection is accompanied by "desktop underwriting" in which appraisers use other sources of information and databases to get more information about particular houses as well as the local area.

               

              Here's a link to Fannie Mae's site with more information.

               

              At Green Light Real Estate, we think this is a great idea. It is up to individual banks and credit unions as to whether they will allow this, and individual lenders may have additional requirements for this workaround. In general, this should help move transactions forward, and help prevent the inevitable backlog of appraisals and loan underwriting that will happen when the COVID-19 slowdown has ended.

               

              We are cooperating fully with appraisers and lenders. Honestly, we spend so much of our professional lives researching real estate, and we have several databases at our disposal to help answer questions about property. We also have great relationships with the different town clerks who are keys to getting supplemental property information. The point is, we're doing whatever we can to keep peoples' transactions moving forward. Because at the end of the day, what people really want is to get into their new house, or to finalize the sale.

               

              Be well, stay safe, and take care of the people around you.

              We're getting through this together.

               

               

               Follow us on Facebook, Instagram or check out our listings on www.GreenLight-RealEstate.com

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                December Market Report

                So, How's the Market?

                December 2019

                Photo by Kevin Wiegand

                The numbers are in:

                  Active Listings # of Sales Past 12 Months Average Sale Price

                Barre City

                32 82 $142, 277
                Barre Town 26 82 $214, 783
                Montpelier 19 69 $278,186
                U32 40 89 $271, 783

                Northfield/Williamstown

                28 84 $192, 437


                Is your curiosity about the local real estate market still not satisfied? Check us out on Facebook, Instagram or check out our listings on www.GreenLight-RealEstate.com

                 

                Market Slice

                How long are homes taking to sell? Different towns tell different stories, but all the information is interesting!

                  Avg. Days on Market 2019 Faster than 2018 by:
                Barre City 83 -4%
                Barre Town 67 4%
                Montpelier 69 10%
                U32 96 28%
                Northfield/Williamstown 68 15%

                (Data gathered for dates 1/1/2018-12/1/2018 and 1/1/2019-12/1/2019)

                 

                Barre City took a tiny bit longer to sell this year, but only a tiny bit. All in all, compared to last year, houses sold more quickly in 2019. 

                 

                From Our Inspector Friends

                Photo by Cheryl Winn-Boujnida

                This is an easy tip--Make sure that outlets in kitchens, bathrooms, exterior, and garages are GFCI-protected. Those outlets come up in just about every inspection, and they’re easy to fix. Those are the annoying outlets that click off when you don’t want them to. But, they also prevent shocks, so, probably a good trade off.

                 

                Investing in Real Estate?

                Photo by Maria Ziegler

                 

                There are lots of good reasons to invest in real estate. Cash flow, appreciation, long term asset acquisition, and tax benefits.

                Whether you’re a veteran or a novice investor, we’d love to help. Our agents have lots of experience with everything from foreclosure flips to large multi-family properties. Call 802-224-6425 or email us to discuss the possibilities.

                 

                 

                Core Values

                Photo by Nick Morrison

                 

                Green Light Real Estate has 13 core values that we live and work by.

                One of my favorites is:

                “We choose to be happy and not to bring troubles to work.”

                This ensures that no matter what’s happening in the world, or our worlds, when we work with buyers, sellers, and each other, we choose to be happy.

                We don’t let negativity bring us down, and we don’t let setbacks keep us down. That keeps transactions moving forward, and, as importantly, makes it fun to come to work each day!

                 

                Green Light Real Estate is Locally Owned

                Photo by Ted Dawson

                 

                We don’t have headquarters in Texas, New Jersey, or Connecticut. Um, actually, we don’t have headquarters. But you can stop into our office on State Street, and we’re all over the internet.

                We have a team of ten talented, energetic and wonderful people who are ready to help you and your friends when it’s time to buy or sell real estate.

                Our core values include being creative, intelligent, fun, and energetic. We’re open minded and we LOVE trying new ideas.

                 

                 

                 

                Finish out the year strong! We will see you in January

                In the meantime, call 802-224-6425 or email us to buy, sell or chat real estate!

                 

                Follow us on Facebook and Instagram

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                  October Market Report

                  So, How's the Market?

                  October 2019

                  Photo by Mattie Dube

                   

                  The numbers are in for the Central Vermont real estate market (numbers through the end of August).

                   

                  Active Listings

                  Under Contract

                  Avg Sale Price Past 12 Months

                  # Sales Past 12 Months

                  Average Days on Market

                  Barre City

                  53

                  8

                  $144,358

                  96

                  74

                  Barre Town

                  29

                  20

                  $205,896

                  83

                  62

                  Montpelier

                  26

                  10

                  $275,597

                  78

                  59

                  U32 Towns

                  55

                  16

                  $249,520

                  84

                  59

                  Northfield / Williamstown

                  39

                  14

                  $199,464

                  84

                  61

                  Totals

                  202

                  68

                   

                  427

                   

                   

                  The Central Vermont real estate market is still strong. Average sale prices in Montpelier, over a rolling twelve month period have topped $275,000, while the sheer number of sales in Barre City (96) and Barre Town (83) show that buyers and sellers continue to make each other happy.

                   

                  Home Valuation Experts

                  In September, five team members at Green Light Real Estate completed a day long training on calculating market values for real estate. Which means that when you really want to know how much your house is worth, you can get the best advice from a local, trained, real estate professional. Or, you know, you could trust Zillow (which recently couldn’t tell the difference between Chelsea and Northfield. Just saying.)

                  Congratulations go to Hannah Dawson, Lindsay Ericson, Kylie Klopchin, Lauren Gould, and Ray Mikus for completing the training. And then yes, there were celebratory cocktails!

                   

                  Fun Fact:

                   

                  Halloween in Montpelier

                  Yay, trick or treating! We’ll be handing out candy to zombies, superheroes, fairies, and ironic-costume wearers at Montpelier’s downtown trick or treating on Thursday October 31 from 4:30-6:00. Here’s a link to Montpelier Alive’s site for more information.

                   

                  Photo by Ted Dawson

                   

                  People Are Talking About Green Light Real Estate

                  Green Light Real Estate focuses on making a complicated and stressful process manageable, and dare I say...enjoyable? It doesn’t matter whether we’re helping someone buy or sell a $95,000 house or a $595,000 house. Here’s what some people have said about us recently:

                   

                   Lindsay Ericson

                  "Lindsay was absolutely amazing, very honest and helpful. She works around you, and makes the stressful buying process 100 times better. I will always go through her." (Five Star Review, Kyra in Northfield)

                   

                    Hannah Dawson

                  "Hannah helped us navigate and better understand the Washington County market.  She is very familiar with this area.  At each walk she would actively point out and describe issues or bonuses with different building systems.  She also was in tune with tax rebates and other financial assistance  programs that are available to many homebuyers in the state.  She is easygoing and a pleasure to deal with on a personal level.  Most importantly she really seems to know her stuff!  Would recommend to others...especially younger homebuyers in the area looking for a “millennial” perspective on the current housing market but also to anyone and everyone looking for a good home buying experience.  Thank you Hannah." (Five Star Review, Montpelier)

                   

                   Lauren Gould

                  "Lauren was great and always kept us in the loop! She was very professional and quick to respond to any questions we had during the home selling process. Easy sale from start to finish!" (Five Star Review, Barre)

                   

                   

                  Call 802-224-6425 or email us to find out what your house is worth in today’s market. Even if you’re a year or more away from selling, let’s start making the plan for a successful sale. 

                   

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                    Should I buy or should I rent?

                    Should I buy or should I rent?

                     

                    Photo by Ted Dawson

                     

                    Ah yes, the time honored question. Should I buy or should I rent? If only it were that easy. A lot goes into that question, and a lot of it is long term, down the pike kinda thought.

                     

                    But some of it is right in front of you.

                     

                    The first question is...do you want to own a house or be a tenant? When you own, you have a type of freedom that renters don’t have. You can get a dog and paint the walls. You can plant your own garden and pick whatever type of towel rack you want. You can invest in energy efficient improvements and even change the layout. The list goes on and on. These are all choices that you get to make when you own.

                     

                    Independence and Security

                    Many people report a sense of independence when they own. Especially, those who are first time buyers. Your entire life, you have had to ask if it’s ok to do something with your living space. That changes when you own. You don’t have to ask anyone (but if you live with at least one other person, it’s probably a good idea to at least talk about what’s happening with your house.)

                     

                    Additionally, many renters feel a greater sense of security when they buy a house. A landlord can choose to raise rent, undergo renovations, or even sell the property. And there’s that a tenant can do about it, so long as the landlord is following the terms of the lease.

                     

                    Sure, it can seem as if your landlord loves you. Maybe you even have a slightly below market rent because you’ve been there so long and you have a great relationship. But at the end of the day, as soon as the landlord decides to sell, you may be looking at finding a new place to live. 

                     

                    As long as you pay your mortgage and taxes, when you own real estate you can stay there as long as you want.

                     

                    Monthly Expenses

                    Which brings me to what I know you’re really reading this for. Does it make sense financially to buy a house, or is it better to rent?

                     

                    Over time, financially, it almost always makes better financial sense to own than to rent. There are a few reasons for that.

                     

                    Rent Check Vs. Mortgage Check

                    One is that if you have a fixed rate mortgage, your monthly payments will only go up as property taxes and insurance go up. In Vermont, that means that if your town votes to increase the budget, your tax bill is going to go up. So, if your property taxes went up $350, then you’d have to pay an extra $30 each month.

                     

                    Many landlords increase by 2% to 3% (or more) each year anyway. But what happens if your landlord realizes that they could charge 10% more and still keep tenants? Your $1000 monthly rent just went up by $100. And what are you going to do about it? Well, you’re either going to pay it, or you’re going to move out. 

                     

                    And guess what? If the place your renting should really be renting for could fetch $1100, then you’re going to have to pay that somewhere else. Either that, or you’re going to move to a place that’s not as nice, or not as desirable a location for you.

                     

                    But when you own, no one’s going to unexpectedly jack the rent on you.

                     

                    Maintenance, Repairs, Utilities

                    I’ll admit, one of the most awesome things about renting is that you’re not responsible for most repairs and maintenance, or for some utilities. It’s kind of nice to have someone else cover that for you.

                     

                    But, ready for a dirty little secret? Most maintenance isn’t really that hard. And you can usually plan for the big things that come up (See blog post: How long do things last, and how much do they cost?)

                     

                    You can learn to fix a toilet, change an outlet, repair handrails, and all sorts of light carpentry. And honestly, if you really don’t want to, you don’t have to. You can hire someone to bang those things out. There aren’t too many things in a house that really need to be repaired at three in the morning. (See blog post: repairs that you have to make at three in the morning, and how to avoid having to do them by planning ahead)

                     

                    Get the furnace checked, pump the septic tank, keep an eye on the roof, hit peeling paint when it comes up. Those are normal maintenance items that you get to perform. And in return, you get...

                     

                    Appreciation

                    Yeah, this is the fun part. You bought your house, and you’ve kept it up. Home values go up and down in cycles, but over the long term, residential real estate has appreciated at around 3% annually. Which means if you just kind of keep your house in decent shape, your $200,000 house is likely to be worth around $268,000 in ten years. So, in appreciation alone, you’d have an additional $68,000 in net worth.

                     

                    If, instead, you had rented for those ten years, your real estate net worth would still be, hmmm, let’s do the math here...zero.

                     

                    And yes, I know that you could have taken the difference in monthly payment, maintenance, repairs, etc. and put it in a savings account or invested in a mutual fund. But would you? Really? Really??

                     

                    Mortgage Pay Down

                    You would also be paying down your mortgage each month. At first, just a teensy part goes to paying down principal, but those decreases add up. In those ten years, your original $200,000 mortgage would be down to $162,000 (assuming a 30 year loan at 5% interest). 

                     

                    Which means you just tacked on another $38,000 in net worth.

                     

                    Which also means that in ten years, your net worth increased by over $100,000. While it’s not all about money and net worth, all things equal, most people would prefer to have an extra $100,000.

                     

                    Summary

                    If you can, it almost always makes financial sense to buy instead of renting. You get independence and security. You can account for the hassle of ownership by following a regular maintenance and repair schedule, or hiring someone to do it for you. Over time, market appreciation and mortgage pay down will add to your net worth.