Real Estate

Being a landlord is rewarding only if you do it right. You do not want your asset and investment to turn into a liability. Getting your property rent-ready is an integral part of property maintenance that requires your careful attention. Sometimes, if you are short on cash, you even have to go DIY and save money by getting scratch and dent appliances from a used appliance store. 

So, how do you go about the process? Here is our quick guide for you.

Make Any Structural Repairs

You will find it easy to make repairs before you put your house on the market. Fix broken doors and windows, treat the damp areas, and re-paint the interior and exterior of the property as needed.

Clean the Property Thoroughly

This is an essential part of getting your rental property for tenants. Clean the house from top to bottom, preferably with a steam cleaner that you can hire to make the floors, furnishings and the curtains look almost new.

The bathroom and kitchen deserve your special attention and do not leave any trace of damp stains or mold anywhere. Your tenant would agree to keep the property in the same condition as they found when renting the house (there might be some wear and tear of course). But you should do your part so your tenant is bound to maintain the same standard set by you.

Give the Plumbing a Check

Make sure that the hot water supply, boiler, sinks, toilets, showers, and baths are safe for use.

De-Personalize Your Property’s Décor

You better choose neutral, plain and light-colored painted walls or wallpaper because they might be more appealing with increased durability than bright colored walls or patterned wallpaper. The prospective tenants might also find it easy to imagine their possessions in the property.

Take Good Care of the Garden

You need to tidy the garden and keep it neat and rubbish-free. In case your property has a lawn, you better trim it to keep the area in a good condition. You may leave the tools for your tenants so they can do the same when necessary and this could be added to your tenancy agreement as well.

Prepare Instructions for Your Tenant

If you have any special instructions for your tenant regarding living in the property and using the different appliances, you could prepare a leaflet yourself and leave it in a folder so your tenant could refer to it. This could be about using kitchen appliances, security system, boiler, and so on.

Prepare Your Landlords Insurance

The typical home insurance won’t cover you if you need to claim for damage to the property. Once you have made your tenancy agreement and prepared your energy and gas certificate, you can then apply for a landlord’s insurance. To sum it up, it does take some effort to prepare your house as a rental property. But this is worth it because all of your effort will generate good returns in the long term that might make you a happy landlord!

For most people, buying a new home is like a dream about to come true. It’s also one of the most important life decisions as it involves a big financial commitment.

Therefore, the property one is looking into must be worth its value. No one would like to invest in something that is going to prove a liability later on.

That is where a thorough home inspection plays a significant role.

What is a home inspection?

The purpose of a home inspection is to provide a potential buyer with a critical examination and fair valuation of the property. It is carried out by certified specialists associated with an independent third-party. The specialists are called Home Inspectors. The cost of the inspection is born by the buyer.

It can help identify potential expensive repair work upfront and enable the buyer to renegotiate the deal.

Who should get it done?

It doesn’t matter whether you are a first-time home buyer or not. Experts suggest that everyone should get a home inspection done before signing the final deal. That said, it’s entirely the buyer’s choice and not mandatory.

Interestingly, the first-time buyers are the ones who generally tend to ignore home inspections considering it to be an unnecessary, time-consuming, and costly proposition. That often turns out to be a mistake.

A home inspection is a relatively small step in the home buying process. It can potentially save the buyer from surprises and heartbreak at a later stage.

Who to hire?

While hiring a home inspector, ensure that he/she is/has:

• Member of a reputed home inspection organization (NACHI, ASHI, etc.)
• Certified
• Experienced in valuation of the type of property you intend to buy
• Strong references
• Aware of the local rules and regulations about buying/selling of property
• A robust track record in the field

Inspection time frame

A home inspection should ideally be done before signing the final deal. The buyer must accompany the inspector on the inspection visit.

The period should be long enough for the buyer to:

• Hire an inspector
• Get the inspection done
• Receive the written inspection report
• Decide the future course of action depending upon the findings

There should also be room for more specific inspections if the initial inspection points to some unique repair requirements. For example, a termite or wood-boring insect issue might necessitate a termite inspection to determine the extent of the problem. Similarly, the possibility of hazardous contaminants in water might require a specialist inspection.

After you receive the inspection report

Once you’ve received the detailed written report, read and understand it in its entirety. Discuss it with the inspector to find out if there’re any major repair needs/defects in the property that need immediate attention.

Subsequently, bring this report to the negotiating table with the seller. Establish clear responsibilities as to who is responsible for what. For example, a seller might agree to:

• Get all the repairs done at his cost
• Bear the repair cost but let the buyer carry them out
• Re-negotiate the deal to the buyer’s benefit

The final decision lies with the buyer. If not satisfied, the buyer might even decide to walk out of the deal and look for a new house/property.

Completion of inspection

It must be remembered that a home inspection is for the benefit of the buyer. After the recommended repairs have been done, the buyer might like to get a ‘re-inspection’ done. In this way, you ensure the credibility and thoroughness of the work done.

Buying a home is one of the most cherished dreams for any person. It’s a decision that requires a lot of planning and a big financial commitment on the part of the individual. It’s important that the decision is based on sound understanding of your finances, so that you can acquire your dream home without hurting your future financial goals.

As they say, location, location, location. A small home such as the one below could sell for more than the large one above if it is an extremely desirable area.

Here are a few tips for home buyers to help them prepare for this important but often overwhelming process.

Ensure that you meet the prerequisites

Take stock of your financial situation to ensure:

• You have little or no outstanding debt. If not, try and pay them first before embarking on buying a house.
• Your savings are in good health to take care of your expenses for at least 6 months after making the down payment of for a new house. If not, start saving extra to build up sufficient funds.
• Income wise, you are secure in the foreseeable future. If one of the following is true, then try and secure this front first:
• You don’t have a regular job
• Your business is not doing well
• You are not happy with your current job, and the market does not have many opportunities
• Explore the real-estate market. Make sure approximate price of the kind of house you want falls within your affordability range.

Plan a budget

Figure out the budget for the house you want to buy. Assess how much you can afford to pay upfront and what would be the ideal monthly instalment for you to pay. The upfront amount to be paid is usually 20% of the total cost of a property. After having made the down payment out of your savings, no more than 25% of your monthly take-home salary should be planned towards paying the loan instalment.

Similarly, plan ahead for the closing costs too, which can be of the tune of 5% of the loan amount. They might need to be paid in future, but it’s better to keep that money reserved or start saving for it.

Find the right home to buy

Do proper research and identify a house that fits your budget and is located in the right neighborhood. Take help of a professional agent if you’re not well-versed with the real-estate scene in the area. Don’t fall for a lucrative offer that makes an unaffordable property look otherwise. Most importantly, stick to your budget.

Get pre-approved for a loan and select the right lender

If you’ve taken care of the prerequisite and planning stages, it should not be difficult to get a pre-approval letter for a loan. Any lender will be willing to lend only after assessing your income and debts. Getting pre-approved gives you an edge in the whole process.

Select the lender carefully based on reputation, competitiveness of the rate, transparency of lending offer and your own experience of dealing with them.

Negotiate hard and get the best deal

You are investing a great amount of money into buying your dream home. So, don’t shy away from negotiating hard and obtaining the best deal possible for you. Do your homework and revise it frequently during the deal finalization process without getting intimidated at any stage. And, don’t let them know if you have fallen in love with a property. That will make it much harder to negotiate and get a good deal.

Size Matters

If you want to rehab a house, what size and price house would you choose? Have you watched the TV show about real estate agents who sell to the rich and famous? Well, do you have contacts to the rich and famous? Do you have the money to fix up a house that size? The larger and the higher end the house, the more money you need to put in to make money on the back side when you sell.

Traditionally, you don’t want to even buy the largest house in the neighborhood even if it isn’t a mansion. Why? Because the average price of the other houses will hold down the price of the larger house. If that same house were in a neighborhood with larger houses the same size as it, it would sell for more.

In addition, there is a limited market for the large homes. Just not that many people can afford them. By going for the average price home you have a much larger market of people who will be interested in buying. That also means you can probably sell faster which is important because there are holding costs involved. The faster you sell, the lower the holding costs and the more profit you make.

What you want to do is find out what the average home price is an area and look for a house that would be worth that fixed up but you can get for a discount because of some problem, whether that is repairs needed or foreclosure or something else. You want an average house with other average houses nearby. Below is just one example.

Repair Estimates

If you are in a trade and doing a rehab then you probably know the prices pretty well already. However, if you are fairly new to rehabs, you need to get an idea of what repairs will cost. That is important for you to know before you bid on a property.

Find 2 or 3 contractors. When you are trying to figure out your bid, have them come in and give you an estimate. This will help prevent you from losing money by bidding too high on a property and then finding out that by the time you have finished rehabbing you have spent more than what you can sell it for. Not good. A saying in the rehab business is that you make your money when you buy not when you sell. In other words, you have to buy right.

On your first rehab, ask the contractors what they would do to fix it up. Make sure you walk through the house with the contractors and talk to them and ask questions. Each will have different ideas which you can pick and choose from. The only problem is that you will get estimates that are hard to compare because they contain different tasks.

After you have done one or two and know what repairs you want done, you can give them a list of repairs to be made and each will have the same list so you can compare one to the other more easily. Still be open to suggestions they may have for you. They could save you money with an idea or suggest something that will increase the attractiveness of the house and therefore the sale price.

Whether you’re selling a home or buying one, it is in your best interest to get the help of a real estate agent. Choosing the right real estate agent is a vital part for the success of your marketing or buying process. You need to choose a good real estate agent that will represent your and interests well during the transaction process. With many companies out there filled with agents who claim to be the best, it can be challenging to find a reliable real estate agent. There are mistakes which are common among agent seekers, and it is best to avoid them at all costs. If you want a reliable agent that will ensure a smooth transaction, avoid the mistakes below.

Hiring the Cheapest Option

There are real estate agents who will undercut the competition by lowering their competition so as to win the bid. Basing your decision on the commission rate solely is a mistake. Agents use their money to market and advertise a property which can be expensive in the long run. Similarly, a buyer’s agent has to collect important information and attend negotiation meetings, which require money. If your agent quotes a low commission, it means there will be less money to market your property. It is therefore important to go for the best option instead of the cheapest option. 

Hiring a Part-Time Agent

There are agents who have devoted their entire lives to helping people buy and sell the property. Such agents are the ideal ones to work with. Choosing a part-time agent to help in buying or selling your property is a mistake to avoid. While part-time agents can be a cheaper option, you are likely to suffer long-term damages due to their misgivings. Home investment is a huge investment and you need an agent that is committed and readily available to help. 

Basing On Emotion Rather Than Skill

Buying or selling a property is a serious business. Hiring an agent based on friendship or family relation does not give you an advantage. Your friend may not see the need to work hard because you can easily forgive his smaller mistakes as opposed to a stranger. Take a look at their track record along with the credentials before selecting the agent to work with.

Assuming All Realtors Know the Same Things

It is a mistake to think all realtors are the same. Every real estate agent has their own experiences and knowledge. This is why some realtors are at the top of the chain while others are at the bottom. Hire a reputable and experienced agent who is a member of the National Association and suits your needs. 

Choosing the Agent That Has Sold More Homes

Some may be tempted to believe that the best agent is the one who has sold more property than anyone else. To determine the best agent, you need to choose for the one who completes the sale, negotiates the most favorable terms, does proper marketing and communicates with you whenever necessary. It may not be the highest selling agent. 

Choosing the Agent That Agrees With Your Pricing

An agent who agrees with your price without any considerations is not an expert. The right agent will be honest with you and tell you the true value of your property. This is will help you use the right price to sell your property. No one wants their property to spend months on the market before it’s sold.