Dec 12, 2012
By: Deidre Woollard
What real estate questions were on your mind this year?
We saw thousands of questions come in on our Q&A section and noticed that people all around the country had a wide variety of questions. Below are some of the most frequently asked-about topics on Realtor.com with answers from the knowledgeable Realtors who helped buyers and sellers navigate the world of real estate.
This year many people searching Realtor.com were curious about what a contingent offer means on a home listing.
Matt Laricy of Americorp Realty in Chicago explained: “It means that there is an accepted offer on the house. Meaning both parties (buyer and seller) have come to an agreement on price. Now that there is an executed contract, they will probably not show the house anymore. They will accept back up offers, but won’t negotiate with you unless this contract falls apart.”
Getting your heart set on a home with a contingency may not be the wisest choice. “It is often not productive to pursue those unless the contingency falls through and the buyer withdraws. If you express interest before that, the listing agent may well use it to pressure the buyer to remove the contingency or otherwise move toward the closing,” says Linda Walters with Sage Realty in Wayne, Pennsylvania.
But should this be your dream home don’t lose hope completely. “If you have your heart set on the house, keep an eye on it. You never know,” says Cathy Baumbusch with Re/Max Allegiance in Alexandra, Virginia.
Another thing we kept hearing about this year was multiple offers as buyers began to reenter the market only to find low inventory. One questioner in Troy, Michigan questioned how multiple offers are handled and what would happen if another buyer offered more money. Multiple offers are usually handled by reviewing all the offers on the table at the same time,” explained Adam Aguilar of Reliantra in West Toluca Lake, California. “This does not mean everyone or anyone will be counter-offered for different terms. A good negotiator should do so, but this does not mean that the particular person you are dealing will do so.
So your son may not have a chance to raise his bid. I recommend to my buyers to put in their best and highest offer, then use the investigatory period to review the property and lower the offer price to what is fair or cancel the agreement. This helps to get your offer accepted and use the contingency period to negotiate, rather than the other way around where you negotiate before acceptance of your offer.”
Buying With Bad Credit
With renewed interest in the housing market many people wanted to buy but weren’t sure how to begin. The first step is often to start with the lender. “You should be in touch with a loan originator that you feel good about and they should be able to guide you through credit repair. They have the tools and know how to tell you specifically what must be done to increase your credit scores. It can take some time- months generally- but it usually can be done,” said Joan Flood of Homestead Real Estate in Cape May, New Jersey.
Recovering After Bankruptcy
Many people who weathered the financial turmoil that began in 2008 are recovering from bankruptcy and eager to start over and own a home again but not sure when they can move forward.
“If you filed bankruptcy and it has been two years since the discharge date, you need to contact your local lender or bank. It is best to meet with them and have them look at your bankruptcy papers and pull an updated credit report. The lender will then let you know what price of a home you can qualify for and if there is anything still on your credit report from the bankruptcy that needs to be removed,” advised Sandy Straley in Layton Utah.
Jackie Davis with American Realty in Inverness, Florida adds “In speaking with my favorite lender he states that, if NO home was involved than the time frame is two years from the date of filing. IF a home was involved than it’s three years. If you are close to the two year time limit and don’t want to lose a particular property, see if you can adjust the closing date to fall outside the two years and, if need be, ask for pre-closing occupancy wherein you pay a prorated rent, assume the utilities, complete your inspections and just await the closing date. See a lender first, get yourself pre-approved and submit this with your offer.”
Home Improvement: Floors Are Hot
Not everyone was looking to buy or sell in 2012, many owners were looking for advice on sprucing up their homes but with an eye toward resale value. We received many questions on the value of hardwood floors versus carpet including one from San Jose asking if it is better to have carpet or hardwood in the bedrooms and if it would add more resale value if hardwood was though out the house.
Hardwood floors appear to be the clear winner. “Hardwood floors enhance the chances of your house selling faster. Generally speaking, most buyers prefer the hard wood floors over the carpet. It may not get you a high return, in fact, it may sell for about the same price as with carpet but it may sell faster because it will compete better with the inventory of “like” properties,” said Maria Jeantet with Coldwell Banker C&C Properties in Redding, California.
“At this time, in the real estate market, wood floors in the bedroom add a little panache,” added Derek Sankey with Sankey Real Estate in North Attleboro, Massachusetts. “Buyers may not ask for wood floors in the bedrooms but if displayed with attractive area rugs, will definitely choose the bedrooms with wood floors over all carpeted bedrooms It tells the buyer that the seller did not hold back on spending more so that their home would be presented as a more custom look.”
But hardwood floors aren’t necessarily a must. “Hardwood floors add a lot of value to a home and make hallways, dining rooms and living rooms, even kitchens, have a wonderful warm feeling, but I have seen more often though that the bedrooms are left with carpeting,” Joyce Mitchell with Mitchell & Associates Real Estate in Bigfork, Montana explains. “I think you would achieve both the value and the enjoyment without needing to carpet your floors.”
“My experience would suggest that hardwood throughout is the best option. But if there is any area that can have carpet without seriously detracting from the value, it would be either a basement or an upper level bedroom. People understand that the noise and warmth benefits of carpet sometimes make installing it there worthwhile. If you do put in carpet, make sure it is neutral. No one wants blue or green carpeting,” advised Linda Walters of Sage Realty.