Thursday, February 18, 2016

Q: We are considering buying land and building since we can’t seem to find a house that will work for us.

How do we figure out what the total costs will be if we buy land and build?

A:  First, be sure you have a certified water source and that it can pass all of the County’s purity and flow tests.  Next is a King County approved septic design.  Those are essential to knowing that the land is buildable.

The costs for building include three elements.  The cost of the land, the cost of the home and the cost of the infrastructure.  Infrastructure includes clearing and grading, developing a driveway and drainage, the septic installation, the cost of bringing utilities to the site, and foundation work.  Those costs are primarily dependent on the type of septic and the amount of work required to prepare the land.
Septic installation can run from about $6,000 to $7,000 for a simple gravity system, to at least $60,000 for a proprietary or more complex system.  Clearing and grading can easily run $5,000 to $20,000 depending on the amount of land to be cleared and prepared.  Our local septic installers and clearing and grading operators can give you a bid once you know the type of septic system you need and the amount of clearing to be done.
The cost of construction is also varied.  A modular company or “on your lot builder” can build a home for around $125.00 per square foot or less.  A high end custom builder will usually start at $200.00 per square foot and can go much higher.  If you use a designer, engineer and/or architect, add on a considerable amount to that.  Any of these professionals should be able give you a ballpark estimate easily and quick.
Be sure to figure about a third of your budget for finish work.  All houses are basically built to the same code.  It’s the finish work that adds greatly to the cost. Plus you should leave a bit in the budget for landscaping.  Otherwise the place can look pretty bare.

Tuesday, February 02, 2016

Q: We’re really disappointed in our Realtor and wonder if you’d care to comment.

He told us about a new listing but then wrote up an offer on it for someone else before we could even see it. Isn’t there a rule or protocol about that? We have lost out on several places in Seattle and are desperate to find something, so he brought us over to Vashon and we thought he was going to help us find something here.

A: There are really a couple of issues here. The first is you’re belief that your Realtor should be working exclusively for you. There is no protocol or rule that says a Realtor has to work for only a specific number of clients. Most active brokers have several clients in the same price range with similar interests and requirements. We all decide on some plan for ourselves and try to discuss that with people as we make a commitment to work with them.

I try to tell all of my clients that there may be other people I’m working with that are looking for the same thing. With such a tiny inventory of homes to sell every year, competition is always tough. I notify every client I have in a specific price range as soon as a new listing comes on the market. Whoever gets out to see the house, and commits to making an offer, will be the one I represent in a transaction. If a second client is also interested I will refer them to another broker I trust.

Your second issue is working with a broker from Seattle. There are some great folks working there, but you should be sure that they really know the issues on Vashon. I spoke to someone recently who made an offer on a home without even understanding that it had a major landslide issue. Fortunately, they were able to get out of the sale. Brokers who live on Vashon Island work with these and other local issues every day. It’s just a safer bet to work with a local broker.

Monday, February 01, 2016

Q: I don’t see how I can ever afford a home of my own on Vashon.

I’m single and prefer to stay that way so I can only qualify for a loan based on my own income. I would really like to buy a home of my own but just can’t afford it. Any suggestions?

A: One idea might be to consider buying with friends. There is a little used form of taking title to real estate called "tenants in common." Two or more people can buy a home together; even hold different percentages of ownership, without being related, in a relationship or married. Our daylight basement style homes and ramblers can often work as two separate spaces to share a home.

I would recommend that you work with a lawyer to draw up any agreement you may need. You will only need to qualify for your portion of the mortgage, but all of the owners together must be able to qualify for the entire amount. You pay your portion each month and that way you develop equity in the property.

With tenants in common, instead of the more common joint tenants, you can sell your share or your heirs can inherit your share. It’s also possible to draw up an agreement between you that would allow each party to have the right to buy out the other if one of you wanted to leave or sell. I’ve known of several people who have done this with friends, sometimes with three or even four friends. The trick is that you do still have the responsibilities of ownership. It’s not like just having roommates. Be sure to draw up an agreement that details who is responsible for which home maintenance chores and how you intend to split utility costs before you begin living in the house.

Talk to an attorney about all of this and ask among your friends if any of them would be willing to share a place. It could mean the difference between being tossed from rental to rental and having a stable place of your own.