Tag: education

Here’s What the Recent NAR Changes Mean For You

Posted on by Tracey Henkels

We’ve been hearing that there’s confusion around the recent NAR settlement and what the changes mean for Buyers and Sellers. We’re even hearing that some Realtors are having trouble explaining it to their clients(!) Here’s a summary of how these changes affect those in Oregon:

1. Agent service fees (also known as “commissions”) are negotiable and always have been.
It’s been customary for Sellers to cover a Buyers’ Agent’s service fee at closing, building it into the sales price of a home. This has always been a strategic marketing decision between the Seller and their Agent as it increases the Buyer pool. Most Buyers don’t have the cash to pay for their down payment, closing costs AND their Agent’s service fee. This essentially allows them to finance that fee within their mortgage.

2. Offers of compensation (Seller offering to pay the Buyers’ Agent’s service fee) can no longer be advertised on any Multiple Listing Service (MLS).
These are local marketplaces used by both Buyer and Seller Brokers to share information about properties for sale. Agents can advertise this Seller concession on off-MLS platforms like social, email and websites.

3. A contract is now required to work with a Realtor as a Buyer.
We can’t show you homes until we sign an agreement that we’re working together. It’s now the law. If you don’t enjoy working with us, you can cancel at any time with no fee. Not all Realtors make it that simple, but we do. Worth noting: Sellers are already required to have a contract in place with their agent to list their home for sale.

More questions? Please call, text, email me; I’m happy to discuss further. Keep in mind that every state is different, but I can connect you to someone great and trusted in your area.

This information is a reflection of personal opinions and understandings as of Monday, September 9, 2024.

Home Inspections – What Are They And Why Do You Need Them?

Posted on by Karim Alaeddine

Hey there, I’m Karim Alaeddine, Principal Broker at Living Room Realty.

Congratulations on taking the leap into homeownership! Let’s dive into the process and talk about the nitty-gritty.

Today, we’re talking home inspections.

 

Home Inspection Contingency

The real estate purchase agreement is a 10+ page document that lays out the terms of the sale. Included is your “home inspection contingency”, a specified period of time for you to bring in a team of pros who will inspect the home and its systems. They’ll dig into every nook & cranny, identifying areas of needed attention or maintenance, pointing out red flags and summarizing the overall condition of the home.

 

What Are They Inspecting?

Expect them to scrutinize everything from the roof to the foundation, plumbing to HVAC, and beyond. A common inspection schedule might include sewer video scoping, radon testing, underground oil storage tank searching & evaluation. Often, specialists are called in for deeper analysis of electrical panels, attic or crawlspace evaluation, on site drainage mapping, etc.

 

The Power Of Knowledge

Knowing about any current or impending issues upfront will give you the power to make an informed decision during the rest of the transaction. This will allow you to move forward with confidence, renegotiate terms, or even rethink the whole deal. The advocate entrusted with guiding you through this process, your realtor, will bring their body of experience and context to you and work to create a safe landing for you at closing.

Bottom line: Your home inspection period is there to protect you. So, now is the time when you get to make sure that the home is exactly what you thought it was.

 

Make A Move 

Ready to make a move? Call your agent today. We would love to help you find your next Living Room.

 

Did You Know?

Ready to level up your home buying knowledge? Delve into our “Did You Know?” series where we unpack essentials of the real estate process. From decoding home inspections to demystifying mortgages, we’re here to make your journey seamless. Explore more insightful tips tailored for your home buying adventure. Let’s make your real estate dreams a reality!

Did You Know – Building Your Home Buying Team

Posted on by Karim Alaeddine

 

Hey there, I’m Karim Alaeddine, Principal Broker at Living Room Realty.

Today, we’re discussing your home buying team, which consists of your lender of choice and your trusted realtor. So, what makes these two players so crucial in your quest for that unique home, that Living Room of your own?

Pre-Approval

Let’s first talk about the lender and the importance of the somewhat magical pre-approval letter. This document is your golden ticket in a competitive housing market. It establishes your commitment, and potential, to become a homeowner. It shows sellers that you’re not just serious, but financially capable of buying a home.

If you’re not familiar with who you’d like to use as your lender, talk with your agent. Most agents have a roster of trusted lenders they can recommend.

With a pre-approval letter in hand, you can confidently make offers, knowing your own boundaries and budget. And this helps your realtor tailor your home search to real and achievable options for you, saving time and energy. And critically, this self awareness builds the foundation for strong negotiations when making offers.

Finding The Right Agent For You

Now, let’s talk about your real estate agent. Beyond just finding & showing you homes, your realtor is your strategic partner on this journey. They’re your advocate and a knowledgeable touring partner who helps evaluate properties, potential, risks, and opportunities.

When that fateful day arrives and it’s time to write an offer on the home of your dreams, your realtor’s fiduciary duty and experience in the market will be the backbone for negotiating on your behalf.

Beginning with educating you on the nuances of purchase contracts and contingencies, guiding you through the complexities of crafting a winning offer strategy tailored to current market conditions, and seamlessly managing the transactional flow – including inspections, appraisals, timelines, and necessary documentation – your realtor remains an unwavering presence at every stage of the process.

So, whether you’re just starting to explore the market or you’re ready to make that leap into homeownership, remember to assemble your dream team: a trusted lender armed with a pre-approval letter and a savvy realtor by your side. Together, we’ll turn your homeownership dreams into reality.

Make A Move

Ready to make a move? Call your agent today. We would love to help you find your next Living Room.

 

Did You Know?

Ready to level up your home buying knowledge? Delve into our “Did You Know?” series where we unpack essentials of the real estate process. From decoding home inspections to demystifying mortgages, we’re here to make your journey seamless. Explore more insightful tips tailored for your home buying adventure. Let’s make your real estate dreams a reality!

Why Buyers and Sellers Should Care About Unpermitted Work

Posted on by Tracey Henkels

I don’t want to freak you out, but this topic is very important!

The process of buying or selling a home involves a myriad of considerations. One topic that seems to go overlooked, or is at least glossed over, is building permits. Permits play a pivotal role in checking that construction or renovation work complies with local regulations, zoning ordinances and safety standards. What a lot of people don’t realize, or don’t talk about enough, is that unpermitted work can end up giving you a great big headache.

Why permits are required:

First, it’s Oregon law that you obtain permits on much of the typical work done on a home. Even if you are doing the work yourself as the home owner, this rule applies. These laws are based on safety, ensuring the work meets minimum building standards for the safety of current and future property owners and occupants.

The risks of unpermitted work:

Unpermitted work can lead to costly repairs, revisions, liability and safety issues. In some cases, it can also void homeowner’s insurance. Ultimately, the liability falls on the current homeowner.

Where it can really bite you in the butt is when selling a property or doing a project on your home that requires a building permit (think: kitchen remodel, adding a bathroom, finishing out a basement, etc.). It’s becoming more common that buyers, and/or their real estate agent,  do public record research to see if a home has the proper permits finalized within the inspection period. If something minor doesn’t have a permit, this is often overlooked. However, major work on a home is being flagged more often in a transaction and can cause a host of issues including requests for a price reduction, requiring that permits be obtained before closing or backing out of the transaction entirely.

Major unpermitted work on a home is becoming more and more tolerated than back when I started in this business 20 years ago. I believe this trend will continue and when we transition back to a buyer’s market, it will become an even bigger headache for homeowners selling a home that has significant unpermitted work. That being said, don’t despair if you do have unpermitted work! I have sold many of homes with this issue and there are a few important things I suggest:

Be transparent about your knowledge of unpermitted work.
Talk to your real estate agent in advance of listing to see if it’s realistic to get the permit closed before you list your home. In some cases, it’s simply not an option, but many times it’s not as big of a deal as you might think.

As a buyer, it’s very important that you make sure to check any home’s permit history during your inspection period (more on how to check permit records below). Especially if the home looks to have anything that isn’t showing up on the tax records, I would highly encourage a buyer to look into this topic as part of their due diligence.

So, when are permits required and how do you check for them? 

When permits are required:

Permits are required for any new construction or alterations and additions to existing buildings. This includes: electrical, structural, plumbing and mechanical. Some of the common work that requires a building permit:

Building a one-two family dwelling
Finishing an attic, garage or basement to create living space
Building, demolishing or adding a room, garage, shed, or other enclosed structure attached to a house
Adding or enlarging a porch/patio cover, carport or other open-sided roofed structure*
Enclosing a patio cover, porch or carport
Cutting new window or door opening or increasing the size of existing openings
Moving, removing or adding walls
Building a deck (more than 30 inches high)
Putting up a fence (more than six feel high)
Moving more than 10 cubic yards of earth

*with a cumulative area greater than 200 square feet that is attached to a house

How to check permit records for a specific property:

PortlandMaps.com is a fantastic resource for permitting and beyond. Type in the address and you’ll be able to see various information connected to the property, including permits.  Please note that this only includes information available on permits issued on or after June 1, 2012. It’s also not 100% accurate. In order to get the most comprehensive and accurate information available, fill out a Research Request Form via the Bureau of Development Services.

The Bureau of Development Services (BDS) oversees the permitting process and ensures that all structures meet safety and zoning requirements: portland.gov/bds | 503-823-7310 | bds@portlandoregon.gov

Building permits, or lack thereof, are just one of the many things you should be aware of when selling, but especially when purchasing, a home. I can help you every step of the way if you are thinking about buying, selling or both this coming year! You can get in touch with me at traceyhenkels@gmail.com or 503.715.6140.

Portland Real Estate: What we’ve seen and what’s to come.

Posted on by Jessica LeDoux
2023 MARKET UPDATE VIDEO
Our team lead and data aficionado Karim Alaeddine has this insight to share about the Portland market: 
 

Hey I’m Karim Alaeddine, Principal Broker at Living Room Realty… here to tell you what you need to know about the market for mid May/early June 2023. 

Let’s take a peek under the hood of the Portland market, look for trends and try our hat in prophecy… forecasting. 

Pricing is going up. It’s been headed north since the very first day of the year. 

Fun fact – the rolling average for median home sales price in Portland is only $50 lower than the absolute high water mark in Spring 2021, when inventory was non-existent and buyer competition was fierce, like… super competitive. We are at that absolute sales price average again today. 

Days on market – a measure of how quickly the current pool of buyers is burning through the current pool of listed homes. This metric has been dropping for 2 or 3 months… as it nearly always does in the spring. To give some perspective, this data (measuring the rate of homes being sold) was last at this level in the spring of 2020. So for most of 2020, all of 2021 & all of 2022, the average days a home spent on market was lower than this week. At its absolute low point in June of 2022, the # of days on market were half of today.

If you’re visual like me, you might imagine a roller coaster going up and down each year (as inventory increases, then gets bought up.) 2023 is a softer, easier ride. Not so dramatic and the downhill fun part (when a lot of homes are getting sold) is less steep… more of a family-friendly ride this year. It’s steady… or it’s a slog, depending on who we are talking with. Not overly volatile though.

That means homes are taking longer to sell… and we’re creeping into the spring/summer season more slowly. 

Let’s look at an interesting data point about pricing, that sort of answers the questions; 

“Should I wait?”

“Will I get buyers?” 

“Are prices going to go up?” 

“Are prices going to go down?” 

A statistic that sheds light on these kinds of questions… the questions we ask when we have begun to think about a move, and are looking into the market crystal ball… is the rate of price reductions in listed homes. 

“How many listings took a price reduction?” To frame the numbers for us, between MARCH of 2020 and AUGUST of 2022, at any given time 20% to 40% of the homes on the market had price reductions, and this was in the MIDDLE of the hot AF market. In SEPTEMBER 2022 that number was headed upward (as a direct result of rising interest rates and lower buyer activity.) It went as high as 55%. Yeah – more than 1/2 of homes on the market had taken price reductions. 

However, in May 2023 we were in the 33% range (middle range of even the smokin’ market) and that stat was trending downhill. We’ll see what Summer brings. Low inventory (the major issue in our market) should keep reductions down – prices up. But demand remaining low will stall things. We’ll see.

Homes are selling, mostly without reductions. Price drops are – of course – used to stimulate buyer activity, but less downward pricing pressure is required to move property when buyers are interested in making a move, in earnest. Lifestyle drives home purchases. Purchases drive market trends. It takes a lot of pressure to turn off the natural incentives of people to move, purchase, sell as these things are life-and-times driven.

Lastly, competition is increasing amongst buyers. (We could do a whole hour on the ins and outs of niche sectors of the market that outpace the averages for metro area – within which competition is still super fierce.) Interest rates were looking to be leveled – with small dips and rises each week of course, but relatively stable. Pricing is actually quite strong meaning the sentiment amongst the market actors (mostly buyers) is that Portland is a good buy for long term housing & investment. Rates may slow things further but the inventory and demand balance does seem to have some natural strength to it… steady or sloggy though this year.

So… with sales strengthening and inventory as low as it is, current supply and demand levels show no sign of prices changing course too dramatically. 

In closing… 

Spring is here. 

Homes are selling.

Not as crazy as last year. 

… Still Portland though. 

Realtors are advocates who help buyers & sellers ask the very best questions, in order to guide clients through the market and into secure, positive transactions that align with their goals and dreams. Hashtag honored.

We’d love to help you find your next home.

3 Referrals is a Sign …

Posted on by Jessica LeDoux

Referred to us by 3 past clients, we knew it was destiny to serve these new buyers. They had the means to buy more house than they needed so it became clear our job was to find the right flow and connection to a house to call home, without buying a mansion. It didn’t take long for Robin & Elliot to find an awesome home that uniquely fits their needs. Congratulations!

Jessica + Karim ~ REALTORS® + Flow Connectors

Hustle with Muscle- Importance of Skilled Negotiation in Real Estate.

Posted on by Living Room Realty

I did a thing!

I’m incredibly proud to have earned the right to call my self a CNE- Certified Negotiation Expert. This educational program is modeled after the curriculum developed by Harvard Law School. Think of super popular books like The Art of Getting to Yes, Never Split the Difference, Give and Take, How to Win Friends and Influence People…

Ok, neat new letters after my name—but what does this actually mean? Well, it elevates my intelligence gathering capabilities. It provides me with scientifically proven methods for finding and leveraging positions of power??. In essence, it makes me so much more effective for my clients?.

Clients say that at least 40% of our time as Real Estate Agents is consumed by negotiating. While only 4% of Agents have any advanced education around Negotiation. ?

One of my favorite things about this industry is the amount of continued education required to maintain one’s license. I can’t wait to offer all of these new tools to my incredible clients.

#alwaysbelearning #hustlewithmuscle