Frequently asked questions home buyers and sellers:
Question: Is my earnest money automatically non-refundable when I offer on a home?
Answer: NO! When you get an offer accepted, you will be required to deposit earnest money, but it does not become non-refundable right when it is deposited. In the real estate purchase contract you have two deadlines that you would need to pass before the earnest money becomes completely non-refundable. The first is the “Due Diligence” deadline and the second is the “Financing and Appraisal Deadline”. The Due Diligence includes your inspection of the property. If for some reason the house has problems and issues that you cannot resolve with the seller, you can cancel the contract and get your earnest money back as long as you do it before the deadline. The deadline is typically 10-14 days for a residential home purchase. You can also get your earnest money back if for some reason you cannot secure the intended financing you thought you could get. You also would have to cancel this before the deadline in order to get the deposit back. The financing and appraisal deadline is usually 20-24 days.
Question: I have my 3.5% down-payment for an FHA loan. Is there anything else I need to pay for when I buy a home?
Answer: YES! When you buy a home and financing is involved you will have closing costs, in addition to the down-payment. The closing costs involve all of the lender fees such as loan origination, document preparation, lender policies, and appraisals. They also include the title company’s fees for recording the property and handling the settlement process. However, the buyer can ask the seller to offer concessions to pay for these closing costs for the buyer. For example, if the closing costs on a $200,000 totaled $5,000, the buyer can offer $200,000 but then ask the seller to pay $5,000 for them to go towards closing costs. This would eliminate the buyer having to come out of pocket for these expenses, and only have put the 3.5% down on the home.
Question: If I don’t use a buyer’s agent, can I negotiate the 3% commission that a buyer’s agent would have received off of the list price of the home?
Answer: NO! Many buyers get confused about this principle because they feel there is a commission that can be used as a negotiating point if they don’t have a realtor. They couldn’t be more wrong. What buyers fail to understand is who pays the commission, and who the commission contract is between. The seller pays the commission. This is decided BEFORE the house even hits the market and it is included in the listing agreement between SELLER and LISTING AGENT. The listing agreement is a completely separate contract between only the seller and listing agent. Typically the agreement is for 6%. The seller agrees to pay this 6% to listing agent when the house sells. The listing agent then puts the home on the market and advertises to other realtors that they will get 3% if they bring a buyer. If no other realtors are involved, the listing agent can keep the full 6% as agreed upon previously. So in essence, the seller has agreed to pay a 6% no matter if there is a buyer’s agent involved or not. The commission contract is not between buyer and seller, so the buyer cannot effectively negotiate the commission out of the purchase price. The buyer is better off being represented by a competent realtor who understands negotiations, the market, and the home buying process.
Get pre-approved with the Josh Mettle Lending Team
This step is one of the most simple and crucial steps to buying your first home. This step is important because Josh Mettle’s team will be able to tell you how much you can afford and what your actual payments will be. Many times buyers simply find an online mortgage calculator to figure out principal and interest requirements, but don’t take into account mortgage insurance, taxes, HOA fees, homeowners insurance, credit scores, and debt to income ratios. The preapproval will also look at your credit score and Josh’s team can give you tips on how to improve it.
2.Identify your needs and wants
After you know how much you want to spend, you need to sit down and identify and your actual needs and wants. This includes everything from cities and neighborhoods, to square footage, number of bedrooms, and style of home. Being realistic about your needs and wants will save you time and headache. The biggest need should be the area you want to live. Have a realtor send you properties in different areas to get an idea what is out there. Drive different neighborhoods and see if they work for you and are close enough to your work, recreation, friends, etc. If the neighborhood doesn’t meet your requirements, then you need to scratch any houses in that area. The three L’s of real estate are Location, Location, Location and this applies to you with your home search. The best house on the planet will lose its “cool” for you if it doesn’t fit in the area you want to live in.
3-Search for a home
Once you know where you want to live, the fun can begin. Touring four to five properties in one morning will tell you if you will be able to find your perfect home in the area you have selected. If you are encouraged by the homes you see, keep looking in that area. When you see a great home, don’t be afraid to jump and make an offer.
4-Write an offer
“How much should we offer?” This phrase is usually the first thing that comes out of buyers’ mouths when they find the perfect home. The answer is, “Depends on the house!” There is no simple equation or formula that tells you how much you can offer off of list price. You need to work backwards with your realtor to determine the value of the home. Before you simply “lowball” every house you see, sit down with your realtor at a computer and review the comparables. By doing this you will be able to determine the market value and make an appropriate offer. Some houses are overpriced and you can justify putting in an offer 10% less than market value. Others are priced very competitively and you can offer 1-3% off list price, while others (such as bank repos) are priced extremely competitively and you may have to offer at least list price or even over to have a shot at landing the house.
5-Get an inspection
Once you have the house “Under Contract”, you can begin your inspection process. This includes a physical property inspection by a licensed inspector. Inspectors will check all the systems of the house including plumbing, electrical, heating, and A/C. The inspector will also look for leaks and cracks in the roof and foundation. They also can do meth and radon tests. We like to tell people this is similar to a doctor’s checkup. The inspector will not make any repairs, rather he will make suggestions and if the property needs a specialist, such as a roofer, we will get the roofer out there to look at the problem. In addition to the physical inspection, you will also inspect the title report for any possible problems with title report such as liens or judgments against either the buyer or seller. Remember that in Utah, property is sold “As-Is”, meaning the seller is not obligated in any way to fix or perform any repairs for you, however sometimes sellers may be willing to do some in order to get the deal closed.
6-Get an appraisal
Throughout the whole process you will be in touch with the lender by providing them with any information they need to get the loan processed. The lender will order your appraisal through a third party company. The appraiser will view the property and compare it to other comparable properties that have sold recently. The lender will send you a copy of the appraisal once it is complete.
7-Do a final walk through
Once the appraisal and inspection items have been completed, you are close to closing! You can do a final walk through of the home with the realtor to see the condition of the home and verify that any requested repairs were completed. This is a good time to figure out where you’re going to put the new 60” flat screen or the new sectional you are buying.
8-Settlement
Settlement takes place at a title company and involves you signing all the loan documents. You will sign a settlement statement which shows the breakdown of the monies involved in the transaction. The lender and realtor are typically present and can help answer any questions you may have. Once you have signed the title company will receive the wire from the lending institution that is giving the money and disburse it accordingly (this is called funding). Once the seller and buyer have signed and the funds are wired, the title company can record the house in your name!
9-Get the keys and move in!
As soon as the house records, it is yours and you can move in! This typically happens within one day of settlement, but can be up to four days. If you are planning to move in over the weekend, be sure to tell your realtor and lender that you’d like to sign by Tuesday or Wednesday if possible so that funding and recording can take place with no problem. Time to move in and enjoy the house! Don’t forget to invite your realtor and lender over for the house warming party!
Welcome to Allure Las Vegas. There are 15 units left in this entire development. We have a range of 2 bedroom styles to a penthouse unit. This video highlights the actual project and detail work. WE have a complete package for those that want more information. Contact Utah Cribs Sales Team or our partner developer:
SALT LAKE CITY — The stalled development not-so-affectionately known as the “Sugar Hole” could soon be showing signs of life.Developer Craig Mecham says hes secured financing for his most recent vision for the corner of 2100 South and Highland Drive in Sugar House.If all goes to plan, construction on the $51 million mix of street-level shops and restaurants, topped by five levels of apartments, will begin in spring 2012.”We think this will be a great asset for the community of Sugar House,” Mecham said.Its a scaled-back version of the project he first pitched in 2007. Those plans included a seven-story office structure and an abutting eight-story residential building, with retail on the ground floor of both buildings.The revised plans call for 44,000 square feet of retail space, with 204 one-, two- and three-bedroom apartments. Plans also include two levels of underground parking.”Given the prominence and significance of this particular location, were very excited that Mecham has his financing and designs in order and is moving forward,” said Soren Simonsen, who represents Sugar House on the Salt Lake City Council.The City Council, acting as the Redevelopment Agency of Salt Lake City, voted Tuesday to lend Mecham $5 million for construction of the underground parking garage. The developer also has secured a $36 million construction loan from Wells Fargo, he said.Mecham plans to repay the RDA loan with parking fees collected from tenants and the public. Rent from commercial and residential properties will go toward the bank loan. The developer is putting up about $10 million for the project, according to financial documents.”Its going to be a major complement to the Sugar House area,” Mecham said.That hasnt been the case for the past four years. In January 2008, crews began demolishing the eclectic row of shops that faced 2100 South to make way for a planned 4½-acre mixed-use development.The credit crunch created by the Great Recession made securing financing for the project difficult. The development also was a casualty of Salt Lake Citys then-maligned planning division.”With the economy and political environment, there have been a lot of issues weve had to deal with,” Mecham said. “Its been a long, drawn-out process.”
New tax deal may speed Cottonwood Mall revivalBy cathy mckitrickThe Salt Lake TribunePublished: May 18, 2011 12:34PMUpdated: June 2, 2011 02:31AMAl Hartmann | The Salt Lake Tribune A fence remains around the empty lot of the former Cottonwood Mall at 4835 S. Highland Drive. Holladay officials hope the approval of an extension of tax increment financing will jump-start the redevelopment of the property.With the exception of Macy’s department store, the 57-acre Cottonwood Mall property sits vacant in Holladay, a victim of the recent recession.However, buildings soon could sprout on the sprawling space if its new developer, Dallas-based Howard Hughes Corp., can obtain a four-year extension from the city and other affected government entities on the scheduled start date of a 20-year tax subsidy.A 2008 agreement channels 75 percent of new property tax dollars generated by the urban renewal project back to the developer over a 20-year period, starting no later than 2013. Holladay city also pledged to give back 75 percent of its sales tax revenue during that time.Howard Hughes consultant Kris Longson told the Holladay City Council last week that the company needs more time to build the first phase, which is why it needs an extension on the subsidy.“We need to represent to our board that it’s all still in place that if they move forward, they can still make it work financially,” Longson told the council.At stake is $96 million in new property-tax dollars to offset the project’s infrastructure costs.Longson seeks a new vote of the project’s taxing entity committee — which includes the county, city, school district and others — that would authorize the 20-year diversion of new tax dollars to begin no later than 2017.Completion of Cottonwood’s Phase 1 will start the flow of tax dollars to the developer. As previously agreed, the Howard Hughes Corp. must invest a minimum of $226 million into Phase 1, constructing 134 residential units and adjacent retail and office amenities.General Growth Properties owned the 1960s-era mall and razed it in 2008, intending to invest $550 million to build a high-end, phased neighborhood of homes, retail and office space in its place. Preliminary work took place to reroute Cottonwood Creek through the property and also to raise portions of it several feet.However, the economic downturn drove GGP toward bankruptcy, stalling the ambitious construction project for more than three years.In November 2010, General Growth emerged as two publicly traded companies, having completed the spinoff of the standalone Howard Hughes Corp., which focuses on master-planned developments.On its website — howardhughes.com — the company touts the Cottonwood project as a town center that will one day “serve Salt Lake City’s most affluent neighborhoods.”At build-out, the property could feature 614 residential units, 575,000 square feet of retail and 195,000 square feet of office space.Randall Feil, attorney for Holladay’s Redevelopment Agency, said Howard Hughes Corp. would need all 20 years of tax incentives to make the project work.“If they finish [Phase 1] in 2014, the trigger year would be 2015,” Feil told the City Council.City Manager Randy Fitts remains cautiously optimistic about how soon and how fast the immense overhaul can happen.“When they arrive in our building permit office and lay some plans down, then we’ll get excited,” Fitts said.The start of actual construction will be cause for celebration in this small east-side city, Fitts added. “Next to our city’s incorporation, that will be probably the biggest news we’ve had.”cmckitrick@sltrib.comTwitter: @catmck
This was just posted in Realtor Magazine. They have done a study of the 8 healthiest real estate markets in the country. Utah is Number 3!! Finally some good new to read. This was no surprise to us, as we have had one of our best years ever in sales.. If you have any questions about the Real Estate market in Salt Lake City, UT give us a call.
3. Salt Lake City, Utah
2011 Building Permit Forecast: 1,294
2012 Building Permit Forecast: 1,181
With lots of high-tech businesses, Salt Lake City is poised to have some grains in employment and income in the coming year. After a drop in home prices, prices are expected to rebound and increase 4.7 percent next year.
Photovoltaics and galvanized siding are green features of this Kihei, HI home.Photo: ZillowIf you had asked someone in the 1960s what the home of 2015 would look like, chances are they imagined something akin to The Jetsons’ home complete with Rosie the Robot and other space-age appliances that dressed and fed the family.But, rather than space-age technology, the biggest thing that is expected to change in future single-family homes is the size.More from Zillow » SF’s Albion Castle and its Underground Caverns» Why the “99” Price Grabs Buyers» Pros and Cons of Owning in a Historic District“Homes will get smaller,” says Stephen Melman, Director of Economic Services at the National Association of Home Builders NAHB in Washington D.C. “We asked builders, ‘what do you anticipate the new home size would be by 2015?’ ”According to the results of the study, surveyed home builders expect new single-family homes to check in at an average of 2,150 square feet. Current single family homes measure around 2,400 square feet, which is already a decrease from the peak home size in 2007 of 2,521.While the decrease in home size has a lot to do with the recession, many believe that the real estate changes will stick around even after the economy and home values get back on solid ground.This Sherman Oaks, CA home has a great room, encompassing dining, living and family rooms.Photo: Zillow“Although affordability is driving these decisions, smaller homes are a positive for builders,” said Melman. “It allows for more creative design, more amenities, better flow. It’s an opportunity to deliver a better home.”Home digital control panels can help manage security and energy consumption.Photo: Control4Other things that make up the home of 2015? No more living room. According to the survey, 52 percent of builders expect the living room to merge with other spaces and 30 percent believe that it will vanish completely to save on square footage. Instead, expect to see great rooms — a space that combines the family and living room and flows into the kitchen.Expect to see more:spacious laundry roomsmaster suite walk-in closetsporcheseat-in kitchenstwo-car garagesceiling fansExpect to see less:mudroomsformal dining roomsfour bedrooms or moremedia or hobby roomsskylights Many of these changes reflect a desire for builders and consumers going green. Smaller space means more efficient heating and cooling. Ceiling fans distribute heat evenly while skylights, on the other hand, release heat.However, as builders look to go green, they’ll be installing energy-efficient windows and compact fluorescent and LED lighting, as well as water-efficient appliances and plumbing.Additionally, many new homes will have the baby boomer population in mind with walk-in showers, ground-floor master bedrooms and grab bars.“A bigger share of the new homes will be purchased by people 55 or 65 and older,” said Melman. “They’re more likely to have more cash for a down payment, but they’re empty nesters, so they don’t need five bedrooms.”
Utah has a new law that affects everyone in the state who owns a condominium. Under the old law, Condominium Associations were responsible for damages to the exterior of each residential building, but the interior of the building was the responsibility of the individual unit owner. Floor coverings, kitchen cabinets, bathroom vanities, and other fixtures that were permanently attached to the building needed to be solely by covered by the unit owner’s policy. So, in addition to your contents, you needed to have an adequate amount of Building Coverage to replace any part of the interior that might be damaged. On July 1, 2011, that all changed.
Under Utah Senate Bill 167 which has now become law, the blanket insurance policy carried by Condominium Associations must also provide coverage for the interior of each residential unit. You might imagine how that is changing the insurance needs for associations and individual condo owners. One neighbor may not have made many improvements to their home since they first purchased it. Another may have added gilded crown molding, an imported crystal chandelier, and expanded their designer kitchen. Clearly, each would have different insurance needs, but who, the association or the unit owner would pay for a loss to the interior of the building?
The new law reads in part, an Association of Unit Owners shall maintain:
“…property insurance on the physical structures in the condominium project, including common areas and facilities, limited common areas and facilities and units, insuring against all risks of direct physical loss commonly insured against, including fire and extended coverage perils…”
“Property insurance shall include coverage for any fixtures, improvements, or betterments installed by a unit owner or to a limited common area, including a floor covering, cabinet, light fixture, electrical fixture, heating or plumbing fixture, paint, wall covering, window and any other item permanently part of or affixed to a unit…”
At first glance, it might seem that since the association is responsible to extend coverage to the interior of the building, you may not need as much coverage. But given that condominium associations and insurance companies could find it more difficult to maintain the right level of coverage over time, associations are electing to increase their deductibles—up to $10,000 under the new law. So, who pays that deductible?
The new ruling goes on to say:
“If, in the exercise of the business judgment rule, the management committee determines that a claim is likely not to exceed the property insurance policy deductible of the association of unit owners; the unit owner’s policy is considered the policy for primary coverage to the amount of the policy deductible of the association of unit owners; a unit owner who does not have a policy to cover the property insurance policy deductible of the association of unit owners is responsible for the loss to the amount of the policy deductible…”
While this may seem overwhelming for many, remembering two things will keep you pointed in the right direction. First, with the passage of this senate bill, it’s very important to make certain you understand the provisions of your condominium association’s policy, including the policy’s deductibles and exclusions. Second, as insurance policies become more complex, the need to scrutinize each policy and to integrate one policy with another is essential to avoiding gaps in coverage. If you are uncertain whether your policy is adequate in light of the new law, consult with an insurance agent who can guide you through the details.
SALT LAKE CITY — Rock-bottom prices and record low interest rates have not been enough to drive people back into the housing market.”The mentality of this generation is apprehensive,” said Colin Wright, CEO of Henry Walker homes. “Is this really a good deal, a good value?”This morning on Sunday Edition Bruce Lindsay discussed housing trends with developer and Adjunct Professor at the University of Utah, Colin Wright. He believes the younger generation will have much different housing needs and wants. They want smaller yards and shorter commutes, which will lead to more urban housing. Getting out of debt will be more of a status symbol than a big house, and energy efficiency will also be important.The important measuring stick right now is home prices. Thirty percent of homeowners in Utah have negative equity, and the starter home may have to become the dream home for a lot of families.”Weve lost that part of the market. They cant move up. They are stuck,” said Jim Wood, director of the Bureau of Economic and Business Research at the University of Utah.He has watched Utahs housing market closely and believes home prices have hit bottom. But, he adds, we are still years away from full recovery. Short sales are keeping prices down and discouraging people from entering the market.The mentality of this generation is apprehensive. Is this really a good deal, a good value?–- Colin Wright, CEO of Henry Walker homes.”Thirty to 40% of all homes sold are bank owned or short sales,” he said. “And those are distressed sales…Most people dont want to get in there until prices stabilize.”Unemployment and poor credit have also soured the housing market, but its causing a boom in the rental industry. “The apartment market is highly attractive right now,” said Kip Paul, executive director of Commerce Real Estate Solutions. “We are actually seeing prices exceed the peak from three years ago.”In the past year, all types of apartment units experienced increases in average rental rates. A three-bedroom unit now costs about $1100 a month, and Salt Lake County only has a 5.2 percent vacancy rate -5 percent is generally considered a tight market.”We are building more but not quite enough to keep pace with what the anticipated demand is going to be,” he said.And demand within the rental industry is also changing.”Over half of those renters are now in single family homes, condos, town homes. They are not in traditional apartments,” Wood said.If rental prices keep going up, homeowners will have more options to rent their home and cover their mortgage.
