Thursday, March 17, 2016

Q: My husband and I have lost out three times in “bidding wars” on homes we wanted to buy over the last few months.

When is this craziness going to end?

A: I wish I had a crystal ball and could answer that question. This is a stressful time in real estate. The main issue is inventory. We have had no more than about 15 houses on the market at any given time for many months now, and most of those are very expensive waterfront homes. We’ve also had a very mild winter, so buyers have been out looking during what is usually the slowest time of the year. With so few homes for sale, anything well-priced and reasonably desirable is selling in days, often with competing offers.  The best advice I can give you is to be totally prepared for the next time. First, you have to be able to get out and see the home immediately. If you’re traveling here from out of state you may just have to wait for our inventory to be large enough to slow this market a bit.

Next, if you are going to need financing you need to be fully pre-approved and your down payment should be sitting in your bank. If you’re paying cash, that money should be readily available and you will need a letter from your bank, financial advisor, stock broker, etc. attesting to your ability to pay cash for the house you want to buy. 
You also may want to consider a pre-inspection of the property, if there is time, so that your offer isn’t burdened with the requirement for a home inspection. But most important is to know what you are willing to pay. If you offer over the asking price or use an accelerator clause, you must be comfortable with paying that extra. An accelerator clause says you will exceed the highest offer by a certain number up to a set final dollar amount. If all of this is too much for you handle, it may be best to wait for a slower time.
         

Monday, March 07, 2016

Q: A friend suggested that we ask your advice about a home we bought on Vashon last year.

It turns out that we can’t make any of the changes we expected to make in order for the home to work for us.  Now we have “buyer’s remorse,” I guess you call it, and want to sell it.  How can we be sure we’ll be able to make the changes we want on the next house we buy?

A:  To start with, you should work with a broker who lives and works on Vashon Island.  Spend time interviewing local agents and asking questions. Local real estate professionals are far more experienced with the issues we have here and the regulations that King County imposes.  You worked with an agent from off island who had no experience here and that didn’t help.  Next, you should consult with King County and read through their online site to get some idea of the restrictions we have. Particularly with waterfront and view properties on slopes, you will have to understand that you can’t just tear down a house and rebuild.
I realize that in our very fast seller’s market you might not have time to go through the necessary due diligence in order to make a wise decision. That’s all the more reason to do your research ahead of time before finding another home.  I generally advise my clients “What you see is what you get.”  It would simply be best to assume that you can’t enlarge, add on, tear down or rebuild.  Probably only modest changes to the existing home will be allowed.

You also have to be committed to living on Vashon Island.  Most of us settled for something that wasn’t our dream home in order to live in this wonderful community.  If that’s not where your heart is, you might consider looking somewhere else.  Making major changes to a home is easier in some parts of Puget Sound that are outside of King County.  Ultimately, your desire to live on Vashon Island must outweigh your desire to have the perfect house here.