Team Reba Real Estate

In a recent post, I talked about the work we were putting into a client’s condo unit on Mercer Island.  The place hadn’t been painted in a while and it was a dull white finish with no real focus on the architectural elements of the unit.  Well, we’ve got it ready and are going on market next week.  Here are some photos from our recent shoot and the link to the slideshow of all the photos.

Before:

After:

The painting was done in roughly 1.5 weeks with 3 color choices being picked.  The plum color was to create depth and highlight the structure’s ceiling height and windows as well as to provide visual interest by the kitchen area.  Cabinets were painted a glossy white, as was the wood shelf installed by the former tenant, the pantry door, and the cabinets and some trim in the bathroom and the fireplace mantel.  Walls and other doors were painted the creamy color to provide continuity throughout. 

So, besides painting, what else was done here?  A LOT!  We advised our client on the updates of lighting fixtures (2 new brushed nickel w/ white covers) , outlet covers (white), lever style door handles (brushed nickel), baseboards, and new cabinet handles.  Once this was all done, we had our Concierge Services come in starting with professional cleaners to clean all surfaces, bathroom, kitchen and appliances. Then we also had window washers come in for an inside and out sparkle.  Then Crew Inc, carpet cleaners, came in to make sure the carpet was in its best condition (our client covered this one).  After it was all prepped we came in with 3 trucks and a Jeep’s worth of staging equipment to give it that last boost of visual punch.  The photo shoot was, as usual, with Scott from Chytil Photo.

So, bottom line?  This work will certainly help our client’s unit stand out now versus the lackluster look we would have had if he hadn’t put forth the effort to get it prepped.  We expect good things to come of it for our seller very soon.

Magnolia View Condo

This updated and funky 1 bedroom, 1 bath unit in Magnolia will have you feeling like you’re in Morocco or Thailand instead of Seattle, except for the stunning view from the full length picture window reminding you that you’re surrounded by trees and mountains instead of sand.  Beautiful stainless steel appliance upgrades including a stylishly sculptured kitchen hood.  Durable Marmoleum flooring in the kitchen and a rich stained bamboo floating floor in the dining, living, and bedroom areas. Gorgeous new lighting with antiqued bronze finish and an earthy, yet warm, update to the bathroom including gorgeous tile work in the shower.  Add to all this lovely living  space a dual access deck (with a storage unit) where you can sit and enjoy beautiful sunsets on warm summer evenings - inside you’ll enjoy those same colors of warm oranges, pinks, and reds all year round.  -  Price point is expected to be below $300,000

Located on the east side of Magnolia this condo has easy access to downtown Seattle, Ballard, Fremont, South Lake Union and Queen Anne.  Not to mention proximity to one of Seattle’s great parks - Discovery Park on the bluffs of Magnolia. Nearby eateries include Red Mill Burgers (yum!), Mulleady’s Irish Pub, Chinooks, and more.

Because it’s always been of interest to me anyway and it is also a point of interest for our assistant, Nina, we’ve been tracking information on green building practices for many years.  If you want to take a little diversion over to another site where I blog, you can read about a recent class we attended on Northwest Energy Star building practices.  It’s pretty interesting stuff.

One of the items discussed is a house in Stanwood that was completely rebuilt using “green” building methods.  You can see it online here at www.goinggreenatthebeach.com and you can see it in person on June 1st from 1-4pm when the owners, Dave and Anna Porter hold an open house for the public to showcase the design and owner friendly features.

A client of ours works at the local Almvigs appliance and design center in the Roosevelt area. While they have loads of gorgeous bath and kitchen items to drool over they are also carrying a product I’d like to see more available (and more affordable) in this area…. LED lighting.

These fantastic little, yet hyper-bright, lights are the up and coming favorite for lowering our energy needs in the USA when it comes to lighting a home.  Incandescent lights burn up a lot of energy and even CFL’s, while better, don’t match up to LEDs (light emitting diodes) because of energy needs, limitations on use, and concerns about mercury when being disposed (they should be recycled).  We’ve had LEDs around for years and they are being used in traditionally manufactured commercial products and auto manufacturing for use in car lights.

If you’re a homeowner, renter, or landlord who is trying to lower your electric bills this is one way to start doing that as well as providing a mercury free lighting source.

As a member of the local, state and national Association of Realtors, there is a lot of information to keep up on all the time.  Some of the items include local news and updates on what is happening throughout the region.  One thing I look for in particular is news on zoning changes, and opportunities for density within existing city borders.  Part of my interest lies in knowing where hot new neighborhoods might rise up and to keep abreast of new development news for our investor clients.

 In a recent news update from

 Mountlake Terrace Increasing Density
The Mountlake Terrace City Council voted 5-2 in favor of a package of housing alternatives to be used in an overlay zone in the new downtown area. Included in the package are reduced minimum lot sizes, options for cottage housing development, and provisions for 4- story multifamily units. REALTORS® serve on the Mountlake Terrace City Council and on the Planning Commission, which studied housing issues and made recommendations “for amending zoning text and maps to allow for new housing choices.”

Having noted recently that there are townhomes and cottage style housing coming into areas that have till recently been dominated by cement cinderblock single story homes, it will be an economic shot in the arm to those neighborhoods that have been ripe for redevelopment.

The other day I was doing a listing presentation for a new client; she’s got an adorable 1 bedroom condo unit in Magnolia with an outstanding unobstructed view toward Phinney and the Cascade Mountain Range.  That alone will get a few people to like the unit, the layout being another as well as some really nice upgrades she’s done to the flooring, the bathroom and kitchen over the past several years.  But, what we’ve got to consider prior to going on market is if the color scheme in her home will translate to more or less dollars when she sells.

There are many colors that are what I like to describe as “very personal” and some of those are in this condo.  What is on my list of “very personal” colors?

purple, pink, some shades of green, peach, bright yellows, some blues, reds, and orange.

In this unit we have hot pink, orange, teal, and a darker red-orange all dressed up with Morrocan and Asian-influenced style furnishings.  Overall, the effect reminds me of high end Thai restaurants I’ve been in before so, personally, with the bamboo floors and other kitchen and lighting upgrades I like it.  However, when selling real estate we have to think about what will be appealing to a wide variety of buyer tastes.  Obviously, you can’t meet everyone’s personal style but we can be aware of what most buyers are looking for.  The best thing here though is that it is “only paint” and not the fixtures or cabinets or other elements of the property that are the problem.

Sometimes you’ll go into a home and see very personal color choices in things such as tile.  While green and blue glass tile is popular right now I am also waiting for the time 20 years from now when that will be looked upon the same way blue and pink bathtubs are now.  These were all the rage back in the 1960’s and 1970’s but younger buyers today can’t stand them and see them as outdated, much like orange shag carpet or macrame curtains - oh yea, all of these are in the house I just bought in October of 2007.  I’ll have to post some photos.

Anyhow, for this Magnolia condo client I think we’ll very likely stick with her color scheme because I think it works and it will show well in online photos. There’s nothing more boring than plain white or cream walls.  

Yet another condo we’re helping a client get prepped for sale in Mercer Island is getting a new color scheme put in after being a stale white for many, many years.  The colors that were chosen are kind of a creamy, butter type of color (not yellow) and a shade of plum.  Normally I’d never go with plum (see list of personal colors above) but in this case it fits.  The berber carpet color has a purplish tint to it which is hard to match anyway but rather than try and downplay it we’ll be enhancing it with the plum walls.  The majority of the unit will be the cream color but 2 accent walls are being put in to highlight the architectural elements of this condo that were not enhanced by an all white scheme.  With somewhere around 14′ ceilings it’s worth it to show off the clerestory windows above the sliding glass door/window to the deck and to help create more of the outdoors coming in - plus providing a better depth perception between unit buildings and the outside landscaping.  A gorgeous blooming magnolia tree just off the deck was also part of the inspiration for the color scheme. 

The cabinets in the kitchen and bath will also be freshened up with a glossy white paint to help them stand out against the tall plum wall in the kitchen and to make them much easier to clean for the next owner.  A previous owner had painted them with a flat paint - a big no-no when painting in kitchens and baths because they show dirt/grease easily and they don’t clean up as well.

I’ll provide updates as we move along with this client’s prep work and show how it turns out when we list in roughly a week.  For now, here are a couple of “before” photos for the MI condo.

Something that is done in the home sales process is the ordering of a title insurance policy for the buyer and the buyer’s lender.  In WA State typically the seller will buy a policy for the buyer at the full sale value of the property and the buyer buys a policy for the loan amount for the lender, if there is one being used in the transaction.  All sellers must provide what is called “marketable title” to the buyer at the time of closing - meaning there are no “clouds” on the title which could include liens, claims to ownership, etc.  If a seller cannot provide a clear title either the deal can be delayed, if all parties agree, until the problem is handled or it might squash the deal depending on the issue.

What happens during the actual process is this:

1.  A listing agent might order a “preliminary title policy” which allows the listing agent and the seller to review what items are noted that affect the property from a title aspect.  Hopefully these people will actually review the document and make sure there are no outstanding items or at the very least begin to work on clearing any issues.

2. When an offer is secured on the property then either one of the agents (listing or buying) will update the title to show the buyer’s info and the sale amount. Title policy prices are based on the value of the property and not just on the type of coverage supplied. By updating the title, this will trigger the title company to send out a copy of the title report, and hopefully any underlying documents that may be part of the title report, to the buyer’s agent and their buyer client.

I’ve noticed that a lot of people, including some agents, don’t know how to read these documents when they arrive.  In fact, I’ve had the odd experience in my broker’s office once of saying to the staff, “oh, good, the title report’s here” only to be told that this was a shocking statement.  I asked what people normally did with these reports and was told that most agents just throw them away. YIPES!  Over time I’ve also found that some title companies are better about sending copies of the reports directly to the buyer client than others.  We always ask for a report to be sent to me and one to my clients but this is often missed.  Regardless of a title contingency element being in a contract you still want to review the report to make sure no items may come up that will affect “marketable title” since it is still a contractual element for closing.

3. If items are noted that are of concern then, if a title contingency is in place, the buyer may make a formal request to have certain items removed or cleared from title.  Even if there isn’t a contingency any items impacting the title need to be cleared by closing (as noted above).

What are some typical items you might see?

mechanic’s liens (workman or construction place a lien for payment of a bill)

utility or tax liens (could be from non-payment or deferred payments if a senior discount was given)

if it’s an estate, perhaps payment of medical care that was provided by the state or there may be other claims on the home from other family members.

easements (be careful with some of these - I had one bite me in the butt with a neighbor who tore up my yard during his house sale) - it’s always best to read what the easement is for and who is responsible for paying the costs of upkeep, replacement, etc.

Covenants, conditions & restrictions (aka CC&Rs) - usually when the property is part of homeowner association and can affect single family homes, townhomes, and condos.

This list isn’t exhaustive but can begin to help you understand that you need to be aware of the issues involved.  When you have questions always feel free to call your agent or the title company for help in understanding what you’re reading and how it affects you, if at all.

The amended Washington Domestic Partnership Law (RCW 26.60) becomes effective June 12, 2008.  If you would like more information go to http://www.secstate.wa.gov/corps/domesticpartnerships/ At the website, you will find a summary of the 2008 changes, access to the 196 page statute and answers to frequently asked questions such as “Who can register as domestic partners?” and “How do we register a domestic partnership?”

Per the Washington State website, “the amended laws generally involve dissolutions, community property, estate planning, taxes, court process, service to indigent veterans and other public assistance, conflicts of interest for public officials, and guardianships.” For more information about the differences in the 2007 - 2008 laws go to ttp://www.secstate.wa.gov/corps/domesticpartnerships/laws_and_regulations.aspx.

 If you have questions or concerns regarding these changes to the laws, please consult licensed professional advice from an attorney.

Frequently I am contacted by  clients and real estate agents asking for help with finding property management companies in Wichita, KS or the Seattle area.  I currently own 2 properties in Wichita, a 4-plex and a duplex, and right now my brother manages them for me. In Kansas you don’t have to have a real estate license to manage property as long as it is 4 units or fewer in number. In Washington, if you are managing another person’s property, that is not a family member, you must be licensed to receive compensation.

Anyhow, an agent asked me if I had a firm I could recommend in Wichita since she had read the less than flattering review of another company that I used previously. I sent her an Excel spreadsheet that I had my assistant put together for me with a list of questions that I gave her to use to pre-qualify the companies she found online.  Here is the list of questions I used; perhaps you will find them useful too.  These are by no means a comprehensive or exhaustive list of everything you should ask, but it’s a start and can lead to additional information you may want regarding the company you’re considering hiring. These questions are reasonable for both in-town and out-of-town landlords to ask a management firm.

1. What are your management fees on a monthly basis?  Are the fees charged before or after expenses are paid for the month?

2. What are your “lease up” fees for getting a new tenant?

3. Is the cost of advertising wrapped into the lease up fee or is the owner charged separately for these costs?

4. What advertising methods do you use?  Do you do a combination of print and online advertising?  Is advertising on-going or only as vacancies arise?  Do you pool fees from multiple clients to do annual on-going advertising?

5. What are your reporting methods for financial data?  Will I get an annual statement at the end of the year besides monthly statements?

6. Do you offer annual maintenance agreements or other methods to check-up on the properties under your management?

7. How is maintenance handled on an ad-hoc basis?  Do you have your own maintenance staff or do you hire out?

8. How do you handle the move-in/move-out checklist for tenants? Are digital photos taken during the move-in/move-out periods to help augment checklists to secure deposits and to handle charging for damages above normal wear and tear on a unit? 

9. Do you require the use of your own leases or do you allow other leases to be used on properties your company manages? And, if you use your own lease, will you provide a copy for me to review prior to signing up with your firm? Has your lease been reviewed by an attorney?

10. If an out of state owner wants or needs work done can your firm help to manage the work, and what is the cost to manage it?  If I have a preferred company to use for a certain type of work (eg. plumber, electrician) will you work with them as well?

11. Does your firm also sell property?  If so, will you require me to use your services to sell my property when I am ready to sell, or is that negotiable if I already have my own agent that I prefer to use? Will the decision to use another agent raise the cost of the fees you will charge me?

12. Will you provide a list of references including other out-of-state owners that I may contact?

13. If I have a large number of units or buildings to manage, is there a discount applied or available to negotiate if I turn them over to you for management?

14.  What is your coverage area for property?  Do you limit your business geographically or to certain types or sizes of property?

15. How do you handle doing background and credit checks on rental applicants?  Do you do full criminal background checks and, if so, how far do you search (eg. local, state, national).  Does your background check include registered sex offenders?  If not currently, will you consider doing it for my business?

16. Do you track local market information regarding rent levels, vacancies, etc and do you share that information with your clients?

17. How do you handle notices and evictions with tenants? Have you ever had to appear in court on tenant related issues? What was the outcome of any such court action?

18. Do you belong to any professional organizations for property management? Does your staff have on-going training or educational opportunities related to your field of expertise?

19. Are you licensed? Do you have a copy of local landlord/tenant laws in your office for reference? How do you handle or deliver necessary disclosure forms for tenants?

20. How do you handle Fair Housing requirements in your area? Do you use the same process for each applicant?  Have you ever had a Fair Housing complaint made against you or any of your clients? How do you handle section 8 tenants and the yearly reviews that are required?

These questions aren’t listed in any particular order but you may find them useful.  Even if you’re looking to manage your own property you might consider asking yourself these questions to determine how you’ll handle these things on your own.

For those readers/landlords in the Seattle and surrounding area I would suggest getting to know the Rental Housing Association of Puget Sound too.  They are a great resource for information, forms, education and more. Check them out at http://www.rha-ps.org

I’m involved in all kinds of online networking sites, the longest time spent as a member on LinkedIn partly due to my time spent in the technology sector prior to becoming an agent 5 years ago.  Occasionally there is a question posted that I just have to reply to because it is a question I am asked frequently and I feel very strongly about the answer.

Damodhar Mata of the United Arab Emirates asked this question about 18 days ago: “When you are looking to secure a mortgage, based on waht parameters would you select a particular lender?”

Here was my reply - and I was thrilled to see that it got voted “best answer” on LinkedIn: 

“First of all, someone you trust and like. You’re about to turn over your most personal asset and credit information to this person. Also, I would suggest that it be a person not representing you as the agent in a transaction as this has the potential of becoming a conflict of interest issue. If it’s for a refinance this isn’t a problem. Some marketplaces make it very common that one person handles both sides but I am personally a skeptic of it as it puts more economic hardship on the salesperson if your transaction doesn’t go through and there is motivation to push it forward, perhaps when it shouldn’t be done. I rarely suggest clients go with the first person they talk to because it’s worth it to ask at least 3 firms for a GFE (good faith estimate).

Second, be sure to use a reputable firm. This can include direct lenders or mortgage brokers. Friends, colleagues and your agent can help you get referrals and references. Be sure to check if your state requires any kind of licensing for mortgage brokers and ask if the loan officer is licensed and have them show you the information - and check it. Washington State just recently implemented such a requirement and there are some folks out there that haven’t yet passed the licensing but they are still writing loans. This is a big no-no.

Loan programs available to you will vary depending on your credit score so know what this is BEFORE you go shopping for a loan. This will help with the process of getting quotes or Good Faith Estimates (GFE) without having to have a lender pull your credit on their own - this will save you potentially if you end up shopping to a few companies since loan officers typically must charge for a credit check AND you could start lowering your score if you don’t know or understand the rules around these requests for credit.

Knowing the terms of a loan outside of just the rate is important and is likely one of the biggest mistakes people have made in the past several years. Rate is one thing, but pre-payment penalties are another. Perhaps the loan you’re being offered requires points be paid to get the lower rate? Is there a teaser rate (oddly low) and then a spike in the rate later on, or it another form of adjustable rate mortgage (ARM)? When does this occur and what is the maximum that it can go up to, not only yearly but for the life of the loan?

Really, you need to know what your holding period is before choosing a loan anyway. Think you’ll be in an area for only 5 years? Well, maybe an ARM (if still available) at 5 or 7 years make sense. Think you might be around longer? Then perhaps a 10 year ARM, a 30-year fixed, or a 15-year would work better.

Figure out what you can comfortably pay and then find options that fit. Fixed rates are low enough still that these make sense for a lot of people. But they aren’t for everyone if there is a big disparity and your life or job situation isn’t right for it.

How much down payment you have will also affect your rate and what loan options you have to choose from. Many banks are requiring higher down payments than in the past several years so ask what you’ll need to have available and DO NOT assume it will stay the same - not in today’s financing market. It might go up, and we’ve seen it happening and we’re getting feedback from lenders that they’re seeing it too.

I hope this helps!

Links:

• http://www.bankrate.com

Rebecca Haas also suggests these experts on this topic:

• Jerry Rutherford
• Eric Aasness
• Danny Tseng

Clarification added 18 days ago:

Because you work for a lending organization I assume you are polling the LinkedIn user base to see if you can get marketing data. I am responding from the viewpoint of how we counsel clients when they come to us to buy a home or investment property.”

When asking Damodhar about whether he was doing market research or otherwise he did report back to me that he is trying to understand how people make their considerations.  When I looked a little further into it and paid attention to where he is doing business, the UAE, it struck a chord.  This is one of the most expensive and lavish places on the planet right now.  Oddly enough, I was just watching a show on Dubai last night on CNBC and it was fascinating.  I get spam from all over the world with regard to real estate but watching this show has me rethinking next time how quickly, or if, I’ll hit the delete button on my laptop.

Anyhow, if you’re out shopping for a loan at this time either in the Seattle area or anywhere else around the USA, keep some of these things in mind that I mention above as you do your review of lenders.  Happy Monday!