Category: Buying Advice

What to do when buying real estate in Lake Oswego, Oregon

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News & Notes

A few tips from Linda:

* Be cautious when looking into a “Lease Option” opportunity if one presents itself. For the Seller, it most always means that the bank can, at any time, call for all monies owing from you on the property per your mortgage’s “Due On Sale” clause, as you are technically transferring a form of ownership in an Option. I.e., you could be called upon to pay in full. Contrary to popular belief, setting up a Trust does not get you around the Due On Sale clause either. Best to consult with your Realtor, and/or attorney before embarking on an adventure like this : )
* Remember that all repairs agreed to in a transaction in the State of Oregon must be performed by a licensed, bonded contractor.
* Make sure to give your Lender plenty of time to “close” your transaction when writing your offer. Talk to your Realtor, and make sure to consult with your Lender to see about how long they need. Lately it is typically around 45 days, but each situation is different. Should you not meet your “on or before” closing date as per your Offer contract, the Seller could possibly accept another offer and keep your earnest money… just sayin’ : ) Now, most people will compromise and agree to an addendum extending the closing date, but you cannot guarantee that the Seller will agree to that… If they have, let’s say, received a better verbal offer than yours during the time it has taken to get from agreement to “not meeting” the closing date, they may just decide to opt to take that larger offer. Just a note of caution.

Let’s take a look at the recently released data on real estate for 2012.
Below is some information for you on the overall Portland area, as well as specific Lake Oswego/West Linn (RMLS lumps them together) activity:

According to the RMLS Market Action Report for the Portland Metro Area December, 2012. At 1,760, closed sales were 9.2% higher than December 2011 sales of 1,612. pending sales (or “Accepted Offers”) were down, however, with 1443 in December of 2011, and 1384 in December 2012… putting the market down by 4.1%.

  • 2012 racked up 32,300 new listings, 24,010 accepted offers, and 23,438 closed sales.
  • Compared to 2011, new listings are down 5.2%, pending sales are up by 16.2% overall, and closed sales are up 19.1%.
  • The average sale price in 2012 was $275,000, which is 4.4% higher than 2011’s $263,300.
  • ***AND… Total time on the market has dropped by 21.5% from 143 to 112 days.
  • The overall economic improvement and increase in volume has positively affected the numbers for total dollar volume which rose to $6.45 billion in 2012 from 2011’s $5.2 billion.
  • For our Property Blotter readers, the combined area of Lake Oswego and West Linn reported the following totals for 2012:
    • 2085 New Listings (68 in Dec’12)
    • 1389 Pending Sales (81 in Dec’12)
    • 1364 Closed Sales (108 in Dec’12)
    • An Average Sale Price of $434,800. ($512,100 in Dec’12!!)
    • Prices rose 1.5% in 2012 over 2011’s totals
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A New Year!

Oswego-LakeGreetings to all of our loyal and new Property Blotter readers!

As we enter our 5th year of publishing this insiders’ look at the Lake Oswego community and Real Estate scenes, we want to take a moment to thank you so much for your interest and patronage through the years! Dianne and I are as committed as ever to bringing you the micro-focused real estate information you count on, and also the perspective of Lake Oswego as part of the larger Portland Metro Area from time to time. Context is good… at least we think so : )

We both specialize in Lake Oswego property, considering the time we’ve spent living and working here, and we both also have been working all over the Greater Portland Area for many, many years, so please remember us if you know someone who needs a really experienced and reliable Realtor for any property “selling or buying adventure” in this larger geographic area!

Though our lives have changed through the years, the Property Blotter has remained constant, and we hope that you enjoy it as much as we do. Recently we have made one BIG change, and that is that we are now working with Oregon First Real Estate Company!  A change like this is the kind of thing that only occurs once in a very great while, and while we have been very pleased with our previous affiliation and will miss those with whom we’ve worked closely for some time, we are thrilled to be joining this vibrant, established local company with offices all over the Portland area and Vancouver!

Just for fun, I’ve pasted below our very first post from 2008, and after reading it, am feeling both nostalgic, and satisfied with the work we’ve committed ourselves to, and all we’ve accomplished with so many of you.

Happy New Year to each of you…. We toast YOU in 2013!

Welcome to the premier edition of the Property Blotter!

This blog is intended to be a fun and useful forum pertaining to real estate issues in the City of Lake Oswego. It will bring you information that directly reflects current market conditions.

It will also provide you with history of the area and insights into Lake Oswego’s vibrant community. You will find plenty of statistics and details about houses currently for sale and recently sold. You will also find neighborhood profiles and featured homes. And, yes, you’ll get commentary on local events and neighborhood happenings.

What you will not find is endless self-promotion and unneeded advertising. This is going to be a place to learn about Lake Oswego real estate and not a place that will waste your time. We don’t care for that sort of thing any more than you do.

And just who are we and why do we have any right to be doing this? We are Realtors who have each lived in Lake Oswego for some time and have been directly a part of this community. Between us we have 30 years of experience selling real estate in this fine community. Between us we have lived in Lake Oswego for 20 years. Our children have attended school here. We participated in sports here. We volunteered with local non-profits here. We know this town.

Lake Oswego is an amazing place to live. It is also seriously misunderstood. Yes, there are million-dollar homes in Lake Oswego. But more than money, Lake Oswego is a town that has people who care. It has always had great schools and so attracts families looking for excellent public schools. There are modest homes as well as lakeside estates.

If we are doing our job right, you’ll come away from this blog feeling like you know a bit more about what prices of homes are like, what is going on with local businesses, and what it is about LO that makes it a great place to live and to work. If you currently live here, you’ll know more about what your home may be worth. If you are thinking about moving here, you’ll know more about what to expect when you buy a home and what this community is like as a place to live.

So come along with us on this “blog-mobile”. It is going to be a great journey.

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Formaldehyde

Over the years the ability of a buyer to do a thorough home inspection has vastly improved. Today I regularly recommend that along with a full house inspection, buyers also pay for a sewer scope (sending a camera down the sewer line to inspect for breaks and tree roots) and radon testing (we find it about 30% of the time). Now a new issue has come onto my radar: formaldehyde.

To be honest with you, before writing this post, I did not have a clue what it is. And, also being honest with you, I’m not sure that I completely understand it now. But I do know that it feels like the sort of issue that will become something that I need to have knowledge about so that I can discuss it with the buyers that I represent. So I am working to learn what I can. It’s pretty interesting stuff.

Formaldehyde exists naturally in our environment. It is made up of carbon, hydrogen, and oxygen. So, just like radon, we are all breathing it as we go through our day.

It is also man made. It is widely used in the manufacturing of so many products that to try to list them here would be unrealistic. To get a grasp of the magnitude of how much of it is used, consider that in 2003 it accounted for $145 billion in our economy, or 1.2% of our GDP. It is widely used in the products that are commonly used in the construction of houses. It is found in glues that are used to install carpets. It’s found in paint. It is a primary component of plywood, particle board, and fiber board.

It is measured in ppm (parts per million). Apparently it has a distinct odor that can begin to be smelled at .05 ppm. At .10 ppm it will begin to irritate your eyes and throat. While I did not find anyone making the firm claim that it is a carcinogen, I did find several sources, including the EPA dating back to 1987, calling it a “probable” carcinogen. It seems pretty clear that it’s not a good thing to be breathing this stuff for long periods of time or in heavy doses.

So what can you do?

First, an interesting tidbit. The products in construction of a home give off more Formaldehyde when the home is brand new. An EPA study found that a brand new house gives off .076 ppm on day one. But by day 30 that amount drops to .045 ppm. Also, heat and humidity contribute to the “off gassing” of formaldehyde. For every 10 degrees of temperature increase, the formaldehyde “off gassing” doubles. So perhaps moving into a new home after 30 days, and then keeping the house cool in the summer and not too overly heated in the winter, would be something to take into consideration.

You can also find a builder who uses “exterior grade” pressed wood products that are made with phenol instead of urea resin. It would also make sense, if you can afford it, to splurge on cabinets and flooring made with real wood.

Some good news is that our Federal government passed a law July 7, 2010 that requires that the use of formaldehyde in plywood, particle board and fiberboard not have emissions greater than .09 ppm. This law goes into affect January 1, 2013.

So how do you know if formaldehyde is a problem? Like I said, this issue isn’t really on people’s radar just yet. None of the well-known environmental companies in the area are offering formaldehyde testing. I did find one company, a company I have never used so will not promote, that is offering this test for about $200. I also found several websites that sell test kits for about $100. I’ll let you do your own google search to find them.

In some ways it bothers me that we have now found something else to worry about. But you are going to spend hundreds of thousands of dollars on a house, and then spend years of your time inside of it, it just seems like it’s smart to figure out what is good and not good about it. Because testing is not yet easy to obtain, it likely isn’t going to be commonly done at this point. But I predict it will come into common use as people’s awareness grows.

How do you fix it if you find it? That can be expensive if you are talking about replacing plywood and particle board. I imagine there may be products that can be painted onto surfaces to seal them. Again, this is a new area for me. If the demand is there on behalf of consumers, there is bound to be an industry that rises to meet the demand. I’d be interested in learning of any solutions that you may know of.

In the interest of full disclosure, here are my sources for this information:
www.en.wikipedia.org/wiki/Formaldehyde
www.prohousedr.com/formfact.com
www.epa.gov/oppt/chemtest/formaldehyde/index.html

Thanks for reading,
Dianne

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Home Warranties 101

It has become common practice for both buyers and sellers to want a home warranty included in the sale of a home. It can be paid for by either because it is negotiable. Why are they popular? Because even with a good home inspection and full seller disclosure, problems can pop up after the buyer moves in. The warranty helps smooth the buyer through these issues during the first year of ownership.

What does a warranty usually cover? Warranties generally cover the mechanical functions of the house, but not the structure. So it covers the water heater, the plumbing, the electricals, etc. It does not cover the structure which is the roof, walls, windows, and foundation. Think of it like this, if it moves or affects temperature, it is probably covered. Most plans do not include the washer, dryer, refrigerator, or air conditioning, but for an additional cost, these items can be added to the policy. You can even add things like swimming pools and hot tubs.

How long do they last? Home warranties begin the day of closing and last for one year. At the end of the year, most warranties will offer the home owner an extension if they wish to purchase it.

Can I chooses the contractor to do the work? No, the warranty company contracts locally with service providers. If you need to make a claim, you call a 1-800 phone number to place a request. The warranty company then contacts their local contractor who will come to your house to do the repair. Each time you call there is a service charge. It runs from about $45 to $75. I suppose this is to keep people from just willy nilly abusing their policy. You aren’t going to call someone to change a light bulb for the cost of a service call, right?

What does it cost? Last week I telephoned 3 well-known providers and got quotes. You can get a quote on-line, but I just think it’s quicker and easier to pick up the phone. The cost will vary from location to location. This quote was for a house in the Portland metro area, but if you live outside of this area, it may be a different cost.

American Home Sheild 888-429-8247
This is the big boy in the game. This was the very first home warranty company I had ever heard of quite a few years ago. I had an American Home Sheild policy when I bought my own home.
The basic plan: $370
Add appliances: $480
I also know that AHS offers an option to cover the house from the moment it is listed for sale. So in other words, if something is found before closing, it can be covered. I recently sold a house in Lake Oswego that had an AHS policy that covered the basic, the appliances, the central air, and was retroactive to the date of listing. The total cost was $510.

Fidelity National Home Warranty 800-862-6837
The basic plan: $260
Basic plus air conditioning: $320
Basic + air + washer/dryer/refrigerator: $425
Fidelity National Home Warranty charges more than this if the house is larger than 5000 square feet. That may be true of the other plans as well. Pretty much the rule of thumb is that you need to call and get a direct quote for each specific property.

First American Home Warranty 800-444-9030
The basic plan: $290
Value plus which includes air conditioning: $420

I honestly think all of these companies are comparable. The pricing is competitive, but please call to get a direct quote. There are so many variables that affect the pricing. I’ve put this up to just give you a sense of costs.

Do these policies get used? Yes. I recall hearing that they get used an average of 2.7 times for each policy.

Let me tell you about my own experience. In the first year of owning my home I had trouble with my dishwasher. It was an older model, so I wasn’t surprised. I called American Home Shield for the repair. The cost of the repairs was going to be about $300. It seemed silly to spend $300 on an old dishwasher. I opted to apply that $300 towards a new dishwasher instead. I also used my policy for a furnace repair.

Be aware that the policy is for repair. As in my example above, it won’t necessarily help you to get all new appliances. Also, read through the policy so that you know what is covered and what is not.

I do recommend home warranties. I think if you have one, you are likely to use it. And that first year in a new home, when you have had all of the expense of the purchase, it makes the first year less stressful.

Let Linda or I know if you have any questions. As always, we are here to help.
Dianne

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Out of State?

Ok, you are reading the Property Blotter, so you are probably at least considering buying a home in Lake Oswego, Oregon, which is a fantastic place to live right outside of Portland, Oregon. What Dianne and I know is that many of our readers are keeping up with the local market from out of state. We know this from our web statistics, and also because we end up working with many of you!

Recently the subject of guidelines or advice around making a purchase from a distance came up, so I thought I’d address it a bit here. The biggest point I want to make is that you need to gauge your tolerance level for trust, and go from there as you contemplate next steps. No Realtor in their right mind wants to proceed forward in a business relationship with someone who does not trust them, and you need to make sure you feel very good about a Realtor’s representation of you, and then, once you make that “trust” decision, believe in them and let them do their best for you. This is what’s best for everyone in any typical transaction.

* The first piece of advice I’d give is to make sure you have your own Realtor. You say, “Of course I’d have my own Realtor, what are you talking about?” Many people do not understand the way brokerage works in real estate in general, and in Oregon in particular. In Oregon, a Realtor can indeed represent both parties in a transaction. The potential for this is disclosed to all parties, including the Seller when the Listing is begun, and when a Buyer makes an offer it is disclosed at that time as well. If this choice is made by the Buyer (you), please just take note that the Seller’s agent has been working with the Seller to obtain the best offer possible from the beginning of the Listing, up until meeting you! Though I have participated in this kind of transaction many times in good faith, there is not that nice, clean/clear feeling of a line between the representation of the Buyer & the Buyer’s interests… and the interests of the Seller. If you are needing to feel that absolute trust that you probably are, considering your geographical distance, I’d play it safe and use your own Buyer’s agent.
* BUT, you ask, “Won’t I get a better deal on the home if there is only one agent?” The short answer is “No.” …not according to the existing listing contract, which is between the agent and the Seller alone. But… “Not necessarily” is the most correct answer, as the Seller’s agent does not need to agree to lower their commission at all during negotiations unless they’ve stated in the listing that they have agreed to do so already. Now, does it sometimes happen that a price gets lowered as a result of the agent and the Seller agreeing to modify their commission agreement with each other in the middle of a transaction? Yes. But the important thing to remember is… they may not decide to adjust price that way at all, and are under no obligation to do so. That does not mean that additional agreements between them cannot happen, but, well, enough said. You get it : )
* So, we’ve established that trust is essential between Buyer & Realtor in a long-distance transaction. The very best scenario is when the Buyer (you) can visit the home at least once before an offer is made. If you can take a week or a few days/weekend and visit, touring with your Realtor, that is optimal. If this is not possible (and technology makes long-distance choosing so much more do-able as you can review photos, tours and property information… even “Google-Earthing” neighborhoods… all online before making your decision), then the second-best thing is to make sure that you, the Buyer, are at the property on the day of Inspection (Ideally, you see it in person AND are at the Inspection : ). You have ten business days, in most instances, to inspect the property, and potentially back out of the deal receiving your earnest money back should you find something that is a “deal-breaker” for you during those inspections. The third best thing is to have a local friend (if you have one near the property you are purchasing) look at the home with your Realtor, and give you their own feedback in addition to photos and videos you are receiving, and information you are receiving from your Realtor. I had one physically disabled Buyer client in California who was unable to see the property at all during the entire process until after the deal was closed and they moved up… so “moving day” was the first actual experience of the property “in person” for this client. Did it all work out, you ask? Yes : ) Satisfaction and happiness were the result, but I made sure to include a close friend in this area during every step of the process, providing additional comfort for my Buyer client.
* “Closing” (or signing, really) can take place out of state as well if necessary. Make sure to pad your closing timeline a little in your offer to allow for any overnight shipping of documents etc, before the property can fund and record. But, some escrow companies have offices in many states, so that’s one way you can be accommodated. There are also notaries who can come to your home and help you in that way. The best scenario, of course, is when you can make it here to Oregon (in this case) to sign in the escrow office handling your transaction. I nearly always accompany my client at the closing table to be an extra set of eyes, answer questions, smooth over or have corrected any last-minute mistakes, and most importantly…. be a comfort to my Buyer clients who are making (for most) the biggest purchase of their life.

There is so much more we could talk about with regard to long-distance transactions, but let’s pick this up in another post! As always, please feel free to contact me for any help at all in your search for a Portland area or Lake Oswego home!

Very Best,
Linda
503 318 2116

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Moving On from Foreclosure or Shortsale

I had the pleasure of attending a continuing education class this past week where the subject was qualifying to buy a house after foreclosure or shortsale. The class was put on by WFG National Title and the guest speaker was Mitch Carpenter, a home mortgage consultant with Wells Fargo. Also in attendance was one of Wells Fargo’s loan underwriters.

Foreclosures and shortsales have been a huge part of our real estate market for several years now. These people who have lost their homes in distressed circumstances are going to get past the hard times, hopefully. In the future they may want to become home owners again. Just how will the foreclosure or shortsale affect their ability to buy a house in the future?

First, a disclaimer. What I am sharing here are some simple guidelines that I got out of a class. Be aware that each circumstance is unique and different underwriters and different lenders may, well, see things differently. This is intended to be general information. If you are in this circumstance, please consult your own lender.

Also, if you are facing foreclosure or shortsale, please seek legal council. What I am sharing here should not be used by you as advice. There are consequences to foreclosure and shortsale that I am not going to go into in this narrative. You need better advice and good legal council that I am simply not providing here.

Extenuating Circumstances vs Financial Mismanagement

When someone who has been through foreclosure or shortsale goes to apply for a new mortgage, the underwriter is going to want to determine if the foreclosure or shortsale was a result of extenuating circumstances or financial mismanagement. Extenuating circumstances are conditions that were out of their control. This may have been failure of a company, illness, or other financial difficulties that were beyond the control of the borrower. It will have been a one-time event that is unlikely to occur again. Financial mismanagement is a pattern of poor choices. Does the borrowers credit history show slow and late payments before the foreclosure or shortsale and also afterwards? This pattern means that the potential for future problems may exist. These two types of distress will determine what a buyer needs to do before they can become a homeowner again.

Foreclosure

If the foreclosure happened under extenuating circumstances:
* Borrow must provide a written narrative explaining the circumstances as well as written documentation and why it will not occur again.
* A minimum 620 credit score
* Purchase needs to be a primary residence and the borrower needs at least 10% down payment
* A credit report that shows borrower has reestablished an acceptable credit history.
* 3 years have passed since the foreclosure

If the foreclosure happened because of financial mismanagement:
* Minimum credit score of 680
* Purchase needs to be a primary residence and the borrower needs 10% down, minimum
* 7 years have passed since the foreclosure

Shortsale

Under extenuating circumstances:
* It has been 2 years since the completion date of the shortsale
* Property can be primary residence, second home, or investment
* No minimum credit score, but good credit will certainly be a factor

Due to financial mismanagement:
* It has been at least 4 years since the completion date of the shortsale
* Property can be primary residence, 2nd home, or investment
* Minimum 680 credit score

New FHA or VA Loans

Both FHA and VA are more lenient than conventional.

FHA will consider a borrow who has been through a foreclosure after 3 years and no further documentation is needed. If the borrower can show it was under extenuating circumstances and good credit has been re-established, they will consider approving a new loan before 3 years.

VA will consider a borrower who has been through a foreclosure after 2 years. If the foreclosure was under extenuating circumstances a new VA loan will be considered after just one year. In both cases the borrower must have re-established good credit.

Of note:
If the foreclosure or shortsale properties were either a VA or an FHA loan, a new VA or FHA loan will NEVER be approved until the the debt is paid in full.

It feels good to be thinking about moving beyond the down turn in the real estate market. There are a lot of people out there who have lost their homes. It has been terrible. Is there a light at the end of the tunnel? I hope so. And for those who moved out into the light, you can rebuild your credit, you can become a home owner again. I recommend connecting up with a good mortgage loan officer and start working with them now for that purchase in the future. A good loan officer will spend time to help you years in advance of your eventual purchase.

Call if you have questions. As always, Linda and I are here to help.
Dianne

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Seeing the Light

Lighting your house correctly is probably one of the most fundamental things you need to  do when selling your home.  People associate light with happiness and cleanliness.   From the National Association of Realtors, here are some basic lighting tips:

Use clear lightbulbs.  The clear bulbs, rather than the opaque, have a cleaner look.

Make sure the lightbulbs are not old.  The last thing you want are bulbs burning out during a showing.  You do not want that beautifully staged room to be left in the dark.

Reconsider energy-efficient bulbs.  Yes, I know, it’s not ecologically such a great idea, but the compact fluorescent bulbs can give off a harsh light.  Many also start out faint and get brighter as they warm up.  A buyer is not likely to stay in a room long enough for the full benefit of the light to come on.

Consider halogen lights.  Particularly in over-head flood lights.  They are more energy efficient than incandescent flood lightbulbs and do a great job of brightening a space.  Of course, please consult the light fixture for correct wattage and the type of rating for the fixture.

Clean the light fixtures.  Dust the entire fixture, including the lamp shade.  Make sure there are no dead flies in the fixture and remove cob webs from chandeliers.  Consider removing the glass from the fixture and running it through the dishwasher (without wiring or electronic components, of course).

Brighten exterior windows. Take advantage of natural light by opening the curtains and window blinds.  If it is a beautiful view to a mountain, the city, or your garden, consider removing the screens and storing them elsewhere.

Replace dated light fixtures.  You get a lot of bang for the buck with light fixtures.  Even a really grand fixture can be replaced for under $200 at most home improvement stores.  Particularly if you have still got lots of brass fixtures, you are well advised to update your lighting.  Particularly in the main rooms of the house:  the entry, living room, family room, dining room, and the kitchen.  Do it.

Add light.  Don’t simply rely on overhead lighting.  Consider adding lamps to side tables, shelves, even counters.  In a dark kitchen, consider buying some battery operated lights that can be stuck to the underside of upper cabinets.

Add a mirror.  Mirrors reflect light, but also make rooms feel larger.

With the exception of removing energy efficient bulbs, these ideas would benefit you even if your house is not for sale.  I don’t know many people who don’t enjoy being surrounded by nice lighting.

Questions?  Don’t hesitate to ask.  Linda and I are happy to help you with any of your real estate concerns.

Dianne

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Buying Distressed Houses

After my post a week or so ago showing the percentage of distressed houses in the current market, I got an inquiry asking what should a buyer do to make the most of these circumstances.

As a reminder, there are two types of distressed houses: shortsales and foreclosures. Shortsales are still owned by the homeowner, but the amount owed on the mortgage is more than the house is worth. To sell the house, the homeowner must get the lender to discount the mortgage and forgive some of the debt.

Shortsales are frustrating because it requires a 3rd party, the lender, to approve the sale. As a buyer you have to wait it out and it can take months. After the wait, the lender may then not approve the sale and your time and effort will have been for nothing. This may not be so bad for an investor, as the end result may be worth it. But for a buyer who is trying to purchase a home, it can be agonizing.

Shortsales are listed for sale just like any other property and are found on most National websites as well as our local RMLS.

Bank Foreclosures (sometimes called REO, Real Estate Owned) are a better proposal for everyone. They are already repossessed and the title to the property is held by the lender. This is a more normal sale in that there is not waiting game for approvals. Escrow can occur in 45 days, just like a normal purchase.

The big difference in a foreclosure is that the bank will have extensive paperwork to protect their interest. They go to great lengths to get buyers of their properties to sign off on any recourse after closing. They will also have items like penalties if the closing does not occur on time. So as a buyer, you need to do your part to thoroughly inspect the property, and the deal on the house really needs to be such that putting up with the hoops that the bank puts out there is worth it.

Bank foreclosures are also listed with Realtors. So you will find them on the National websites as well in on our local RMLS. However, there are a couple of other websites that you can use:

www.homepath.com lists Fannie Mae foreclosures
www.va.equator.com lists Veterans Association Foreclosures
www.hudhomestore.com lists FHA foreclosures

These websites do not charge for the information. There are numerous other websites that do charge. I have always felt it is silly to pay for what is otherwise free. If you google “bank foreclosures” you’ll get a slew of sights that want to make money off of your curiousity.

Next you need to know that if you are going to get into this game, you have to be ready. You are one of thousands. These houses, at least the ones that are priced right in nice areas of town, sell fast. So you 1) need to get your money in order with proof of funds for cash purchases or financing for a mortgage, and 2) watch the market daily and be prepared to move.

When the deals are offered, expect multiple offers. Be prepared to pay over the list price. In a recent experience I have had, there were 4 cash offers. My buyer went just $1100 over the list price and got the house.

Last, be prepared to find defects in the house. People who are underwater in their homes or loose their homes to foreclosure do not have money to do repairs. These properties are sold “as is” and the repairs fall to the buyer. Again, get a good home inspection. These offers are still made subject to a home inspection contingency. So if you find something really bad, you can get out of the deal.

There really are buying opportunities out there right now. I hope this gives you some perspective on how you might make the most of the situation.
Dianne

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Distressed Properties

The RMLS recently provided this graph to Realtors and I found it interesting. It occurred to me that you might as well.

It clearly shows that while distressed sales make up 17.2% percent of the new listings, they make up nearly 29% of the closed sales. Of that the shortsales are pretty consistent being 15% of the new listings and 13% of the closed sales. Whereas the foreclosures are just 13.2% of the new listing but account for 25.6% of the closed sales.

I do think that the banks are throwing houses out onto the market at pretty rock bottom prices. I’ve seen a few houses lately, priced so low, that half a dozen offers get written within days. Then the bank takes a week to respond and even more offers get written. This is a very negative thing for surrounding property values. What I am describing here is happening in much greater numbers outside of Lake Oswego, but I’ve seen some of it here as well.

The other interesting characteristic on this graph is the non-distressed properties. They represent 71.2 % of the new listings, but 61.1% of the closed sales. That 10% difference? I think that’s over-priced housing that has not adjusted to the reality of the current market.

I’ll work to find a happier subject for my next editiorial post, but I did find these graphs both useful and interesting.
Dianne

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Terra the Wonder Dog

Terra, the wonder dog
Meet Terra, the wonder dog. Terra works for EcoTech. She is a specially trained dog to search and find in-ground oil tanks. She is the only dog with this training in Oregon.

I have come to really like working with EcoTech. They are a wonderful company and perform many services. I use them for radon testing and finding and decommissioning of oil tanks.

Just because a house currently does not have oil heat does not mean that it never has. If a house was built before about 1965, you need to think that it may have had oil heat in the past. After all, oil was the least expensive, and therefor the most popular, heat source for the majority of homes prior to about the mid 1960’s. Just as gas heat is today.

So if it is an older home you are buying, you really do need to do a tank search.

Most tank searches use metal detectors. EcoTech still does this. In fact they use 2 different types of detectors. But then they also use Terra. The cost is competitive ($85 at my last tank search a week ago), and you get all 3 searches on the same house.

It’s just really fun to have Terra to watch. So I give my kudos to Terra and to EcoTech for making what would otherwise be a rather mundane task into something fun and interesting.

Dianne