Buying your first home can feel like both the best of times and the worst of times. Here are 10 facts nobody tells you when you’re buying your first home.
1. Something will go wrong
No move is ever perfect. Something will get broken or there will be something you’ve forgotten to bring or do. With any luck, the setback will be minor, and you can chalk it up to the old adage, “things happen.”
2. Some of your conditions might not be met
One of the least enforceable clauses in offers to purchase is one for cleaning requests. You can stipulate that carpets, refrigerators and ovens be cleaned. However, if they haven’t been, there is often very little that you can do about it.
If a major repair hasn’t been completed as promised, one of two things will happen: you either won’t take possession of the property on the day you planned or your funds will have to be placed in escrow pending resolution of the issue.
3. If you don’t have the closing fees, you don’t get your new home
Legal fees are due on closing, and your funds won’t be released to the seller unless your lawyer is paid. Closing costs usually range from two to five percent of the purchase price, but be sure to verify this information before arriving on closing day. This money is in addition to your down payment.
4. Good schools increase a home’s value
You’ll pay more for a house in a good school district. Of course, the good news is you’ll get more for it when you decide to sell. If the home you’re planning to buy is your “forever” home and you don’t have, or plan to have children, this may not matter. Still, it’s something to think about.
5. Your neighborhood may be about to change drastically
The municipality may be planning a park, a school, or a playground for your area. Depending on your lifestyle, that can mean profound changes in a short period of time. Check with local administration and the area’s local representative. The first can tell you what the plan is. The latter will have a far better grasp of whether outlined timelines are accurate or not. You can base your decision on the information they provide.
6. You need to read all the documents yourself
It’s tempting when you’re paying a lawyer to review HOA or condo documents to simply delegate this task. However, a close reading of the minutes of meetings will teach you a lot about your neighbors-to-be and help you avoid nasty surprises, like planned increases in fees or devolving renovations that used to be the condo board, or HOA’s responsibility to individual owners.
7. Don’t apply for other credit while mortgage shopping
Applying for a loan or another credit card may seem like a good idea when you’re about to take the home ownership plunge and know you’re going to need to buy things like garden tools, a gazebo, and a grill. Don’t do it unless absolutely necessary. It can negatively affect not only the amount of your pre-approved mortgage, but it can also mean you don’t get pre-approval. Wait until after you’ve bought your home to apply for more credit.
8. You’re going to need “earnest” money
Also known as a deposit, you’ll likely need about $1000 per $100,000 worth of house available when you make an offer. This money is required as a show of good faith and will be held in escrow. You’ll get it back if your offer isn’t accepted, or it may be applied to your down payment. You may forfeit this money, though, if you’re the one who withdraws from the deal.
9. Your neighbors-to-be may be your best source of information
Walk around the area you where you want to live. If you see people out gardening or mowing their lawns, talk to them. Strike up a conversation and explain that you’re thinking of buying. Ask receptive individuals what the neighborhood is like, how long they’ve lived there, and how long they’re planning to stay. If you learn that your new home is located next door to some party animals who blast music every single summer evening, you may not enjoy your own backyard, so you may want to reconsider.
10. Check for rebates you may be entitled to
You may qualify for first-time homeowner rebates. There may be other municipal, state, or utility-provider rebates available, too. Start investigating early. It may make more sense to invest in attic insulation than an air conditioner if you’re going to get a rebate that covers some or all the cost of the insulation. Some areas offer rebates on newer, more energy-efficient appliances. You won’t know that unless you do your homework.
A good real estate agent can talk you through the buying process. Now you’re already ahead of the game with these ten facts nobody tells you, and you’ll be able to focus on offer strategy rather than the fundamentals.
15 Juniper Lane, Wilmot ~ 3 BR, 2 BA
One floor living! Appreciate the ease and comfort it brings...and enjoy the privacy of being surrounded by nature. Tucked in on 2 acres, the location is private and peaceful yet not far from downtown New London. Not your cookie cutter ranch, this inviting sunlit home offers vaulted ceilings with large windows and sliders, birch floors in the main living area, a gas fireplace for cozy gatherings, a generous sized kitchen open to the dining/living area, and a sweet breakfast nook perfect for morning coffees. Enchanting garden spaces around the exterior of the house will surprise and delight you all season long. And let’s not forget about the front porch, which beckons for a relaxing sit after a long day. If you are looking for that one special place where coming home is as comforting as a cup of hot cocoa and fuzzy slippers, then give this one a look!
Donna Forest, Listing Broker ~ donna@donnaforest.com ~ 603-731-5151
Nearly every real estate contract contains contingencies. How you deal with a real estate contract contingency might make or break the sale of your home. Some contingencies are easier to deal with than others, of course. Generally speaking, the faster you can fix the issues or make the accommodations stipulated in your real estate contract, the sooner your home can be sold.
What is a Real Estate Contract Contingency?
A real estate contract contingency is any condition outlined in the contract that must be met prior to the sale of a home. These stipulations exist to protect both buyers and sellers. If any of these conditions are not met, the contract would be void and the sale might not be able to move forward.
Common real estate contingencies include mortgage contingencies, which state that a mortgage loan must exist for the contract to move forward, and a home inspection contingency, which protects the buyer by requiring the house to be checked by a certified home inspector before the sale can move forward. In the case of a mortgage contingency, the stipulation is removed from the contract as soon as the loan is obtained. If a buyer cannot obtain a loan, they are usually able to gracefully exit the pending contract without penalty.
For a contingency like the home inspection requirement, once documentation of the check is obtained, the contract can proceed. If the home inspection finds faulty wiring, pests, structural damage, or other major problems with the property, the buyer can exit the contract without penalty. In this instance, the buyer would also receive any deposits or earnest money back. Alternatively, the buyer can request that repairs be made at the expense of the seller. If the seller does not wish to proceed and make the repairs, they can choose to void the contract. This again necessitates a return of all of the buyer’s deposits.
Another contingency that is often placed in a real estate contract involves the sale of the buyer’s current home. This stipulates that the buyer has a certain amount of time to sell their current home before purchasing a new one. If the home does not sell during that set period of time, the contract is voided. This protects the buyer from a scenario wherein they have to purchase a home they’re under contract for while they still have a mortgage on or equity in an old property. In a cash-poor situation like this, many buyers would not be able to obtain a mortgage or pay all-cash for a home, regardless.
Dealing with Contract Contingencies
As the seller, it’s important to have a real estate agent and attorney you can trust. These parties may review your contract with you and point out any contingencies that could prove problematic to you. If you know, for instance, that the home you are selling needs a new roof, chances are good you’d have to disclose it anyway.
However, under those circumstances, it’s important that a contingency for home inspection be worded properly and allow for the buyer to take possession of the home and then make their own repairs, in exchange for a lowered purchase price. This sort of phrasing can be critical if you’re a seller with a timeline for leaving your current property. You may not be able to wait to vet roofers and make the repairs yourself.
Similarly, if you are willing to accept an all-cash offer for a home so that you can move on more quickly, you should verify with your real estate agent that the contract is not contingent on the buyer having a mortgage loan in hand. There are unique issues that arise in all-cash deals, but if you are comfortable with that sort of arrangement, your contract will need to reflect it.
Most real estate contracts are fairly standard, but it’s always possible you are dealing with an inexperienced or even unscrupulous buyer and buyer’s agent. For this reason, and to protect your best interests in general, you should carefully review any contract you are considering signing. After all, it’s much easier to walk away before you have signed something than to have to find a way out of an executed contract later.
For advice with contingencies and much, much more, you can trust Better Homes and Gardens - The Milestone Team. There's a reason we're The Best Team in Town!
This post was originally published on the BHGRE Life Blog - https://www.bhgre.com/bhgrelife/
Buyers are crying and realtors are pulling their hair out in this competitive housing market. There simply are not enough homes for sale to meet current demand. Why? Here are some of the major reasons.
The housing shortage has been brewing for a long time. After the 2007-2008 financial crisis, builders mostly stopped building. There was less demand and financing for these projects was harder to get. On top of this, builders have a hard time finding labor. Many left to find other jobs after the downturn and fewer people are now going into the trades.
The cost of lumber and building supplies has nearly tripled. Lumber companies shut down during the pandemic and when they came back, production was reduced as much as 50%. They underestimated the housing surge as well as the increased demand in remodeling. Trump era tariffs on Canadian lumber did not help.
It’s a tsunami of events where unprecedented demand has collided with this period of under production. Millennials are now at the home-buying age, COVID has changed job markets, investors are buying 20% of all homes in the US, and there has been an increase in vacation home buyers. Builders are making progress but it will take some time to catch up. The housing market will not be changing much in the foreseeable future. Whether buying or selling, contact me to put my 27 years of knowledge to work for you.
Donna Forest ~ donna@donnaforest.com ~ 603-731-5151
One of the first things your real estate agent will discuss with you when giving you tips for selling your house is the importance of “curb appeal.” While that includes your front door, windows, exterior light fixtures, walkways, fencing, and your front deck or porch, it’s also all about your yard.
You may not be able to choose precisely when you put your house on the market. But as soon as you know you want to sell, you should start the outdoor work, preferably at least a month before you list the house and have an open house or book showings.
Here are a few tips on things you’ll want to tackle to make sure your home has enough curb appeal to get people in to view its interior.
Rent a Power Washer
Great for cleaning vinyl or brick siding, gutters, and paved surfaces, a weekend with a power washer is a great way to start the exterior clean up your home will need before you list it. As you clean the walkways, make note of any cracked or broken paving stones, and replace them.
Don’t forget to use the power washer on any birdbaths, water features, or small ponds you’ve created to wash away stains and lichens that may have started to sprout.
As you make your way around your home, check your exterior light fixtures and clear out the bugs that have collected in them and replace any burnt out lights.
Trim Shrubs and Trees
Now is the time to tackle low-hanging or damaged branches and shrubs that have overgrown the space allotted to them. It won’t just make the place look better, it will invigorate your trees and shrubs and force new growth in the direction you want to encourage it. If you have large trees that are beginning to encroach on power lines, consider hiring an arborist to do this work for you.
Invest in half a dozen paper yard waste bags and rake up any dead leaves and twigs. Most municipalities have yard waste collections or drop-off depots. Take advantage of them, and get rid of all your yard waste at once.
Unless you have perennials already planted at the base of your trees, consider investing in some top quality mulch instead of planting annuals later on. Invest in a few extra bags so you can top up the mulch once your house is listed. Cocoa mulch, if you can find it, is the husks of cocoa beans. When it’s fresh and shortly after it rains, you get the bonus of the lovely scent of chocolate spreading throughout your yard.
Remove Must-Have Perennials
If you have cherished perennials with a lot of sentimental value (bleeding heart, cherished rose bushes, or lily of the valley from your great-grandmother’s home), it’s better to remove them before showing the house. If you don’t have another place to plant them immediately, just put them in pots and make sure the pots are listed as an exclusion when negotiating a sale.
Invest in Annuals and Hanging Pots
Keeping a house immaculate while it’s listed for sale is enough work without constantly worrying about the exterior as well. This year, no matter what your usual garden plan is, invest in tons of long-blooming annuals and fill up all your garden beds with them. Spread mulch around them and you won’t have to weed.
Petunias and pansies are particularly nice because they come in so many different colors and bloom all summer long. Chicken and eggs are a good investment too, as they’ll expand to fill the space available to them and grow densely enough so there won’t be any weeds creeping in amongst them.
Depending on the timing, you can also invest in roll-out flower gardens, seeds embedded in biodegradable material. While germination should only take a week or two, most take five to six weeks for full bloom, so this solution might or might not work, depending on the season and how early you’re starting the garden spruce up before you plan to sell.
Lush hanging pots of flowers or some attractive tall planters filled with a variety of flowers and decorative grasses are always a nice touch too, and they’ll keep the focus on your entryway.
It goes without saying that you should ensure any patches of damaged lawn are reseeded as one of the first steps prior to selling. It will take a while for the grass to catch up to the rest of your lawn, but it will make a huge difference. A sad or patchy lawn plants a negative seed in potential buyers’ minds, making them wonder, “If they haven’t taken care of this, what else has been neglected?”
Try not to let that thought take hold. Your real estate agent may have other tips for selling your house that relate to the garden and exterior. Listen to them and do as much as you can. It will make a difference in the number and quality of offers you receive and the number of days your house is on the market.
This post first appeared on https://www.bhgre.com/bhgrelife/how-to-spruce-up-your-garden-before-selling/.
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Listing Broker: Donna Forest ~ 603.731.5151 ~ donna@donnaforest.com
We're proud to share this recent article published on www.Masiello.com. The Masiello Group is a fellow member in the nationwide Better Homes & Gardens Real Estate brand, and a strategic partner of ours.
Bedford, NH --Maine and New Hampshire are attracting home buyers from around the country, drawn by the lower cost of living and higher quality of life in Northern New England. The increased demand from out-of-staters has contributed to a rapid rise in home prices and record-setting lows in inventory throughout the region. If this trend continues through 2021, it could bring significant economic growth to Northern New England, changing the face of communities large and small across these states.
Real estate data from the National Association of Realtors show that the median home price in the Northeast during February was $356,000, up 20.5% from February 2020. Year-to-date numbers for 2021 indicate the increase is part of a longer, recent trend. Home prices thus far in 2021 are 23% higher than all of 2020 for single-family homes and 16% higher for condos.
The price increase is driven by higher demand, and not just from the typical sources. Historically, people move to a new home within 10 miles of their current home. But since Q3 2020, Masiello Group real estate agents have seen an increase in home buyers from major Eastern Seaboard locales like Connecticut, New York, New Jersey and Washington, DC. There's also been an increase in the number of people from Sunbelt regions like Florida and Arizona, and expensive West Coast cities such as Seattle and San Francisco.
Buyer data collected by the Better Homes and Garden The Masiello Group, which has 33 real estate offices throughout Northern New England, found that 35% of people who bought homes in New Hampshire and Maine during the latter half of 2020 came from outside Northern New England.
What's behind the move?
While there is no hard data yet to confirm that the COVID pandemic had a direct impact on people moving to Northern New England, the timing of the increased in-migration points to a connection.
A survey conducted by the University of New Hampshire Carsey School of Public Policy found that people have been moving to New Hampshire to be closer to their family, for work, and to enjoy a higher quality of life and better lifestyle. This bolsters the anecdotal evidence many agents are hearing from people moving here from outside the region.
"Home buyers today are less restricted on where they can live, thanks to more liberal remote work policies. Given the choice, people often go with the location that's safer, offers more home for the price, and has the highest quality of life," said Chris Masiello, President and CEO of the Masiello Group. "What many of us who have made Northern New England our home already know is that the lifestyle here can't be beat. We have much of the same infrastructure and amenities as larger metro areas, yet we have a lower cost of living and close proximity to the outdoors. It's a place you can truly live, work and play."
The increase in home sales by out-out-state buyers tracks with the timing of announcements made in 2020 from major companies like Twitter that they would move to a permanent remote work model. For people unrestricted by location, they can opt to move somewhere that offers a better quality of life, larger home, bigger yard and closer-knit communities.
"Both Maine and New Hampshire are a great choice for these amenities," said Masiello. "They have more affordable housing than locations further south, they have safe communities, modern infrastructure and are still close enough to urban centers that you don't feel too isolated. On top of that, New Hampshire has a low tax burden and business friendly climate."
Potential economic boom on the horizon
High demand from home buyers outside of the region means it's never been a better time to sell a home in Northern New England. According to Tom Cole, 2020 President of the Maine Association of Realtors and Broker with Better Homes and Gardens Real Estate The Masiello Group in Brunswick, Maine, residential real estate activity in his state "is vigorous."
"In most markets across Maine, Realtors are reporting multiple offer situations on move-in ready listings. The increased competition for historically low for-sale inventory availability is resulting in price appreciation," Cole said.
What makes this in-migration trend so noteworthy is that it appears to be happening across all residential property types throughout Northern New England, not just for single-family homes or in isolated communities. People who are thinking of buying a bigger home in a more affordable town nearby are surprised to find home prices are rising there too. This trend also comes after a period of community investment throughout the region, funded by a healthy pre-pandemic economy. Communities are investing in basic infrastructure and amenities that attract residents, such as revitalized downtowns, park renovations, and hiking and biking trails.
These investments, combined with an increase in home prices, are likely to spur development, resulting in overall growth in these communities. If demand remains high for an extended period, it could launch an era of substantial economic growth across the region as the economy begins to open again.
Commercial properties are also highly desirable
Increased interest in real estate in downtown areas is further evidence an economic boom is on the horizon. Having a row of storefronts instead of vacancies will certainly boost a community's downtown revitalization efforts, in addition to the jobs and economic activity it brings.
Another emerging trend is out-of-staters moving to Northern New England—and bringing their businesses with them. "Commercial agents saw an increased interest in 2020 from business owners looking to relocate from major metropolitan areas," said The Masiello Group VP of Commercial Sales, Chris Pascucci. Business owners from big cities create opportunities for new businesses that provide services city dwellers have come to expect, such as take-out and delivery services, ethnic food, and personal care services.
"People from places like New York want to be somewhere safe and to have a better work-life balance," said Pascucci. "Relocating to Northern New England offers the connectivity, more affordable home prices, and plenty of opportunity for businesses to open and grow."
Where this economic boom could face some pressure is if nothing is done to alleviate the region's low inventory rate and competitive, fast-paced market. In Rockingham County, New Hampshire, average time on the market in February 2021 was 35 days, down 52% over February of last year, and new listings of homes in New Hampshire were down 31% in February 2021 when compared to the same month last year. According to the Maine Association of Realtors, home values and sales volume is outpacing last year thus far, however, "a continuing positive trajectory for 2021 is dependent on homes for sale coming onto the market." If there are not enough homes to supply-demand over the long term, it could discourage some home buyers from entering the market at all.
Northern New England is fortunate to see signs of a strong economic future in rising home prices and increased demand. How long this trend will continue and the degree to which prices continue to rise is somewhat uncertain as major cities begin to reopen and return to normal. However, we're confident the market will remain strong, thanks in large part to the desirable location that Northern New England offers.
About Better Homes & Garden Real Estate | The Masiello Group
With 33 offices throughout Northern New England, BHGRE The Masiello Group has been the region's leader offering a full range of services to brokers, sales associates, and home buyers and sellers. It is the only company in region to offer home services, including mortgage, title, home warranty, homeowner insurance, and relocation services under one roof. Visit www.masiello.com to learn more.
Real estate markets are local, and we have the real scoop on ours.
Better Homes & Gardens Real Estate - The Milestone Team
Unless you live in a cave, you’ve probably heard multiple times it’s a sellers’ market and a great time to sell. So what does this really mean? Historically a balanced market has a 6-month supply of homes for sale in which there are enough homes available for active buyers. The most recent report (February) from The National Association of Realtors (NAR) shows the US inventory at just a 2-month supply. NH had less than a month’s supply and new listings were down 23% YTD thru Feb. compared to 2020. As a result of this increased competition, properties sell quickly and for much higher prices than we would typically see in a more normal market. Sellers are in prime position to best negotiate price and terms favorable to them. The median sales price in NH (thru 2/2021) was $350,000, up almost 23% for the same months last year. I have been in real estate here for 21 years and have never seen a market like the one we are experiencing. Will it last? Well my crystal ball says probably not. Lawrence Yun, NAR’s chief economist, cautions of a possible slowdown in growth in the coming months as higher prices and rising mortgage rates cut into home affordability. Having said that, forecasters are predicting prices, on average, to appreciate almost 6% in 2021. If you are considering selling, contact me to find out why this is the ultimate time to be a seller!
Donna Forest ~ donna@donnaforest.com ~ 603-731-5151
You might be wondering if the housing market will crash given the high demand, record prices, and bidding wars. The short answer is “there is no bubble.” It would be natural to assume the same thing is happening that led up to the economic crash in 2008. However, the influences are very different. Below are 3 reasons why you can still sleep at night.
- The limited supply of homes for sale is driving up prices. It is simple economics of supply & demand. Inventory has been declining for years yet buyer interest is increasing.
- Demand has risen as millennials, currently the largest generation in the US, are entering the housing market. Throw in historic low interest rates, the ability to work remotely, and rethinking of housing requirements due to COVID, and now the need exceeds supply.
- Poor lending practices was a big contributor to the housing implosion. If you could breathe you got a loan. Also homeowners used the equity in their homes like an ATM machine and ended up owing more than what their house was worth. As a result, foreclosures & short sales depreciated home values nationwide. Lending guidelines today are much stricter and refinancing over the last 3 years is 1/3 of what it was 3 years before the crash.
Here is a quote in late January from Laurie Goodman, director of Urban Institute’s Housing Finance Policy Center, “I’m feeling very optimistic about the health of the US housing market.” Whether buying or selling, contact me to take advantage of today’s great market!
Donna Forest ~ donna@donnaforest.com ~ 603-731-5151
In this market where multiple offers are common, buyers are pulling out all the stops to try and successfully compete. Some buyers are resorting to the use of an escalation clause. This works by offering the seller $1000 (for example) more than the highest bid the seller receives from other buyers. The clause may contain a cap to limit the buyer’s price exposure. Below are just some of the reasons why this is not a good idea.
- An accepted offer with an escalation clause may not be an enforceable contract since it does not contain definite terms. Potentially either buyer or seller could later change their mind and claim no legal contract was formed.
- If the escalation clause contains a cap, it basically tells the seller the top price this buyer is willing to pay. A smart seller could reject all offers and counter back to every buyer with a request for new offers not less than the cap.
- Escalation clauses create exposure for buyers since they don’t know what they will actually be paying for the property. Will they qualify? Will the house appraise?
- What if several offers come in with an escalation clause? Who wins the bid?
- If a legal escalation clause were to be written by an attorney, it would probably be a page long of legalese in order to protect the buyers. Not exactly enticing to a seller.
There are many ways to write a compelling offer without an escalation clause. Whether selling or buying, contact me if you want to effectively navigate this complex market. 603-731-5151; donna@donnaforest.com