Home Buying trends and demands are constantly changing. We share information and current real estate market conditions in Arizona with our clients as we help them find a home to meet their needs and lifestyle.

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Are Home Warranties Worth the Cost?

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kitchenAs a home buyer or home seller, you may have wondered whether a home warranty is worth the cost. Homeowners insurance protects your home against unforeseen accidents or damage.  A home warranty, on the other hand, is a supplement to this insurance. Simply put, a home warranty is a convenience program that covers normal wear and tear on the major electrical and mechanical systems in a home, typically for a one-year period.

A home’s ventilation, heating and air-conditioning, plumbing, water heater and kitchen appliances are typically covered by a home warranty. However, be sure to read the fine print on any home warranty. Be sure to note what exactly is covered and what isn’t.

Another wrinkle with home warranty plans is that they don’t offer quick fixes to any problems that are discovered within the home. Home warranties are not the same as emergency home service contracts, where the homeowner can make a phone call and have the problem diagnosed and fixed within the same day.  Instead, with a home warranty, the homeowner will have to file a claim, and the home warranty company will choose a local service contractor to diagnose the problem for a service fee, which isn’t covered by the warranty.  Then, the claim must be approved by the company.

While a home warranty can be a nice back-up plan, it’s critical that any homeowner identify any necessary repairs during the home inspection period.  The home inspection will typically uncover any major issues with the maintenance of the home, and will set a precedent for regular service of the major mechanical services. For example, some home warranty companies won’t cover an air-conditioner that hasn’t been serviced in a past set number of months. Therefore, having this done during the home inspection negotiation period will help to set up a seamless transition to the home warranty service period. Home warranties in Arizona average around $400-500 depending on the size of the home.

Click here to begin the search for your next home! 

Buying and Selling Simultaneously

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house keyBuying and selling homes simultaneously can can feel overwhelming, it can also raise many questions, especially regarding timing. When should you list the home you’re selling? At what point should you begin looking for a new home? What happens if you get an offer on the home you’re selling before closing on your new place?

The key to combining your buying and selling processes is timing. Taking the time up front to consider your options and make educated timing decisions will increase the chances that you’ll get to seamlessly move from the old home into the new space.

So, how do you make those smart timing decisions?

Find an Expert. A good real estate agent is a knowledgeable and reliable expert on buying and selling homes simultaneously. The agent researches and understands current trends which will help you time your transition to the new house while also getting the most money from the house you’re selling.

Know the Market. A real estate agent is also a great resource to educate you on your local market. The agent uses current market data, the condition of your home, neighborhood comparable homes and other factors to determine a realistic selling price for your listing.

Understand your Finances. As you look at your options, know where you stand financially, how much equity you have in your current home, and how much money you can reasonably use toward the down payment of a new house. Homeowners who have enough equity to sell their existing home and can come up with a down payment for another one are going to have an easier time buying and selling at the same time. Know that there are many options for those homeowners in all financial categories. Understanding your finances will help when you discuss this process with your agent.

Make Quick Fixes. Price and home condition are the two most important factors that effect the sale of your home. As explored specifically in previous posts, investing money up front to update the yard, repaint the walls or make other small fixes has been proven to significantly increase the likelihood that your home will sell more quickly.
Start Shopping for the New Home. If you and your agent agree that listing your home is a good decision for you, it’s time to begin your home search process. If possible, start looking at homes before you put yours on the market so that you have an idea to the timeframe it could take to find the new place based on your search criteria.

When You’re Ready, List Your Home. Putting the home on the market is a careful process that depends largely on how fast you think you will be able to find and close on your new home. The previous step, shopping for the new home, will help make that decision. Keep in mind, if you put the home on the market and the right buyer puts in an offer more quickly than you anticipated, there are contingencies you can add to the contract to give you more time to find your new home.

Buying and selling homes simultaneously has its challenges, but we have the experience and knowledge to make it happen for you. Call us to learn more! Chris 480-754-9077 & Cheryl 480-754-9477

5 Packing Tips for Your Move

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moving dayYou sold your house-congrats! Now you must tackle the daunting task of moving! Use these helpful tips to pack up and move with ease:

1-Have a place in your home that is designated “packing central”.  All your moving information and needs like labels, box tape, markers etc. should always be kept in the same location so you know that is where everything is during the moving process.

2-Make a list. If you write things down you won’t forget things. For example, you may want to make a packing list. For every box you pack you will have the box numbered with the contents listed clearly on the box.  This will help not only you, but the movers as well. If items are clearly labeled “kitchen” then the movers won’t put that box in a bedroom.

3-Or instead of numbering the boxes, you can color coordinate your boxes. For example, anything with yellow on the box is for the kitchen and red marked boxes are for the master bedroom. You can then place a color sticker on the doorway at the new home that matches the ones on your boxes so the movers will know where each box is to go.

4-Wardrobe boxes are very handy. They can take all the items from your closet and transport them easily to your new home without worrying about being all creased when you get there. You can also fill the bottom of these boxes with shoes and purses and then cover the clothing with dry cleaning bags to keep from getting dirty.

5-Give yourself plenty of time to pack.  Do a little bit at a time and you won’t feel so overwhelmed and stressed out that it needs to get done quickly.  This is also a good time to clean out your closets and cabinets of items you no longer need or want.  You can make a big trip to a local Goodwill or other charity in your area that can use your household items or clothes.

Moving is a hassle and no one really enjoys it, but with any luck you are moving into the home of your dreams and this will be the last move you make for a long time!

Tips for Buying a House on a Budget

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phoenix home for saleJust because you have a low budget doesn’t mean there isn’t a great home waiting for you to discover it. However, shopping for a home on a budget can be challenging. You may feel nervous telling your realtor or you may not know how to approach your bank about it, either. Just remember that there are plenty of people who buy houses on a budget, follow the tips below for great results!

Consider Foreclosures
Foreclosures are usually homes that were repossessed by a bank or lender because the owner could no longer make mortgage payments on the property. The bank is then trying to sell the property to get it off their hands and recoup the money they lost on financing the home in the first place. Because of this, however, another bank isn’t likely to finance this type of purchase, so you may not have the benefit of a loan to help you out. Also be aware that these homes are almost always left in disarray and poor conditions because the owners couldn’t afford to keep up with repairs – or, in some instances, were angry about the foreclosure and trashed the home before leaving.

Look for “As-Is” Homes
Once again, you may have trouble getting the bank to approve a loan for an “as-is” home, but if you’re in good standing with your bank you may be able to qualify for assistance with one of these properties. These homes may have only minor cosmetic damage, but in some cases, they could have serious structural or roof problems that will need to be repaired at your expense. If you plan to buy an “as-is” home, be prepared to spend a long time shopping around before you find a home that doesn’t need anything too significant in terms of repairs. Otherwise, in the long run you may end up going way over your budget.

Stay Up-To-Date on Neighborhood Changes
If you live in the city, think about neighborhoods that seem to be transitioning from low-quality to better-quality. While you may have to deal with more growing pains than you might prefer in these areas, at least for a few years, chances are good you can get a great home in a neighborhood many outsiders aren’t considering yet. In a little while, these neighborhoods will improve and you’ll be living in a great part of town. The same is true of suburbs surrounding cities that are expanding. Give it a few years, and you’ll be closer to town than you used to be.

Are you looking to buy a home? Get started with this custom home search. We are real estate experts who can help you find a home that meets your needs and lifestyle. Chris 480-754-9077 & Cheryl 480-754-9477

Things to Look for at an Open House

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home for sale
Are you getting ready to go to open houses? Looking at open houses is one of the many ways you may choose to work with your realtor to find the perfect home for your family. Yet, an open house is different from an individual home showing, and the things you’re looking for may be quite a lot different in this situation. In an individual showing, you’ll be better able to look closely at potential problem areas or things you want to think about, but in an open house, you’ll need to focus on a handful of factors during the time you spend touring the home.

Look At The Floors
You’re probably busy looking around at all the features of the home you’re viewing, but don’t forget to stop and look down every now and then, too. If there are tile floors that look as though they were laid in a DIY project rather than by a professional, you may want to consider the potential issues that could come along with this. Of course, any DIY job isn’t always a sign of something wrong, but it does mean you should keep it in consideration.

Maintenance Issues
Does the home look like it’s been kept up well, or does it appear to be lacking maintenance? Are there a lot of burned-out bulbs, dirty light fixtures, outlets mixing covers, cracks in the decorative molding, or other similar issues? Maintenance problems usually indicate that the homeowners haven’t been keeping up with more serious repairs around the home either.

Mold And Water Damage
Always be on the lookout for mold and water damage. If you notice a discolored spot on the ceiling, it’s likely a water leak and you should ask about it. If you see mold, bring this up as well.

Foundation Problems
You probably won’t be able to get a great look at the foundation while you’re looking around at an open house, but you can check the inside and outside walls for cracks. Small hairline cracks aren’t really an issue, because these are normal with older homes regardless of their quality. However, if you notice very large cracks, especially those that go from floor to ceiling, you may want to move on to the next open house.

Are you ready to start touring homes? Give us a call, we’d love to schedule private showings for you and tour open houses with you! Chris 480-754-9077 & Cheryl 480-754-9477

The Effect Changing Jobs Has on Buying a Home

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changes-signFor most people, changing employers will not really affect your ability to qualify for a mortgage loan, especially if you are going to be earning more money. For some homebuyers, however, the effects of changing jobs can be disastrous to your loan application.

How Changing Jobs Effects Buying a Home

Salaried Employees

If you are a salaried employee who does not earn additional income from commissions, bonuses, or over-time, switching employers should not create a problem. Just make sure to remain in the same line of work. Hopefully, you will be earning a higher salary, which will help you better qualify for a mortgage.

Hourly Employees

If your income is based on hourly wages and you work a straight forty hours a week without over-time, changing jobs should not create any problems.

Commissioned Employees

If a substantial portion of your income is derived from commissions, you should not change jobs before buying a home. This has to do with how mortgage lenders calculate your income. They average your commissions over the last two years.

Changing employers creates an uncertainty about your future earnings from commissions. There is no track record from which to produce an average. Even if you are selling the same type of product with essentially the same commission structure, the underwriter cannot be certain that past earnings will accurately reflect future earnings. Changing jobs would negatively impact your ability to buy a home.

Bonuses

If a substantial portion of your income on the new job will come from bonuses, you may want to consider delaying an employment change. Mortgage lenders will rarely consider future bonuses as income unless you have been on the same job for two years and have a track record of receiving those bonuses. Then they will average your bonuses over the last two years in calculating your income.

Changing employers means that you do not have the two-year track record necessary to count bonuses as income.

Part-Time Employees

If you earn an hourly income but rarely work forty hours a week, you should not change jobs. There would be no way to tell how many hours you will work each week on the new job, so no way to accurately calculate your income. If you remain on the old job, the lender can just average your earnings.

Over-Time

Since all employers award overtime hours differently, your overtime income cannot be determined if you change jobs. If you stay on your present job, your lender will give you credit for overtime income. They will determine your overtime earnings over the last two years, then calculate a monthly average.

Self-Employment

If you are considering a change to self-employment before buying a new home, don’t do it. Buy the home first.
Lenders like to see a two-year track record of self-employment income when approving a loan. Plus, self-employed individuals tend to include a lot of expenses on the Schedule C of their tax returns, especially in the early years of self-employment. While this minimizes your tax obligation to the IRS, it also minimizes your income to qualify for a home loan.

If you are considering changing your business from a sole proprietorship to a partnership or corporation, you should also delay that until you purchase your new home.