Friday, July 31, 2009

Why I only preview homes and show homes to clients by appointment.

Yesterday afternoon I took out a client who was referred to me and we previewed a handful of homes which he mentioned in our initial conversation a few days ago.

After previewing the last home he asked me about seeing 2 more homes that were relatively nearby. It isn't my practice to show homes other than by appointment,but I could see he was aggitated and didn't see what the big deal was. For me,at that point the big deal becuse I didn't have a printout of the property information on me,which would have also included the listing agent's telephone number and showing instructions. And the only information that he wrote down on a scratch piece of paper was the addresses.

So,because I am open to revisiting 'the way I do business', to see if there are compelling reasons to change what I do/don't do or to reinforce to myself and others why I do/don't do certain things,and because he was referred to me and I didn't want him to possibly spin it out that I didn't want him to say that I didn't want to show the homes,I reluctantly agreed.
I called a couple of colleagues to get any information on the homes that I could,but they were on other telephone lines,on appointments and said they would get back to me.

We arrived at the first home,which didn't have a sign in the yard indicating it was on the market for sale or rent,so I called back one of my colleagues and got confirmation that the home was on the market and got the listing agent's number. Unfortunately I got the listing agent's voice mail.
So I walked to the door and the key was in a combination lockbox and the number combination number wasn't listed (from the conversation with my colleague).

They still wanted to see the second home and they jotted down an incorrect address. I called my colleague once again to get the correct address and showing information,which fortunately was to show any time. So,we arrived at the home and there was a car in the driveway,which is nothing to be alarmed at. I knocked on the door to see if anybody was home and it was people renting the home. They were gracious and let us tour the home. I could see that my client was uncomfortable walking through a home while people were in the house,but sometimes being uncomfortable is good. People tend to remember why they were uncomfortable and if the next time we meet they ask me to do something which isn't my practice, maybe from this experience they'll remember why I was reluctant.

Here are some reasons why I only show homes by appointment:

a. to find out if home is vacant or occupied

b. to see if showing instructions are by appointment only -- some showing instructions indicate that either the home owner or the listing agent must be present for showings.

c. to have all property information with me,including the listing agent's contact
information, where the keys are and if there is also an alarm code for getting in

d. to make sure the home is still on the market.

e. to know determine the most efficient order and route to show the homes.

It was a productive 3 hours with my client. We got to know each other well and know more of what to expect on both ends the next time we meet. It was good for me also to get uncomfortable and do something I usually don't do (show homes without an appointment),in this case as a refresher for why "I do what I do". I am always open to change,better ways to do things and the next great idea. The good news at the end of the day is that he is considering 2 of the homes that we previewed.

Wednesday, July 29, 2009

Executing a home settlement/lease agreement when seller/owner is out of town

I found a home for a renter or as I like to think of as 'my future buyer'. The home is owned by a lady out of the country and her mother,a realtor, is the listing agent. So I was there with my clients to execute the lease,but the listing agent wasn't.

This in and of itself is ok,but I thought the listing agent would have been there, thinking her daughter gave her power of attorney to sign the lease or she would help us expedite the daughter signing the lease, unless she was under the weather.

So I worked with the agent's manager. My clients read over and signed the necessary documents,which didn't have any signature on the owner/landlord.

Since the listing agent wasn't there,we didn't know if she had power of attorney to sign the necessary documents and if she could have in fact signed. The manager, to my surprise, wasn't sure if there is power of attorney. It was my error not to ask directly to the listing agent before settlement how the lease was going to be executed with her client/daughter out of town,so I wouldn't be surprised.

So we left the settlement table without a "fully executed lease",which is either going to be signed by the agent (if given power of attorney) or mailed to the owner out of the country. So,we can expect a fully executed lease in 7-10 working days and commission checks won't be written to the brokers until that point in time. But the broker collected the 2 checks today for deposit and first full month rent. No keys for my client yet because not fully excecuted lese. So The broker was able to taketh but not giveth away.

To the landlord's credit, she is doing the right thing and pro-rating August rent until the lease is signed by the other party. The owner's mother really should have been at settlement to resolve the matter/give clarity then and there. So, I'll have to wait a few weeks to get payment. I do everything I can to represent my client's interests,but I do so in order to earn my salary.

I did get the manager to laugh when I asked when the last time she had a dry settlement was. To think positive,at least it isn't a short sale/foreclosure where I may not be getting the salary I earned for my work.

For my clients,the home is being cleaned up and they are scheduled to pick up keys for the home on August 7 and I will make sure the home is move in ready for them,and that I get paid ,of course :-)

Tuesday, July 28, 2009

The financial impact neighbors have on your home purchase

I was recently talking with a colleague who received a contract on his condominium listing.
According to him,the buyer looked strong but he couldn't get a loan for the purchase level agreed upon at purchase. The buyer actually spoke to 5 lenders as the buyer and seller were trying to make their contract work.

Each lender independently reviewed the condominium association documents,noticed that over 30% of the owners in the building were behind in their monthly condo/hoa fees, saw that as a red flag/warning that their could be short sales/foreclosures (for the owners behind in payments) in the building and that these sales would bring down the property values of other units in the building. The lenders were looking at the future and concerned that at a certain point in time when their buyer wants to sell, that his home would be worth less than the loan they approved on their home and could himself be facing a shortsale down the road.

At the end of the day,the buyer was able to purchase the home,but he had to pay cash (no loan).
So if you ever have an offer accepted on a home that is part of association,take the time to read the association documents,for all information about the building,including whether other owners are current on their payments so you can guage whether this will be an issue for a lender and if your lender says he/she cannot provide financing,can you make a cash deal happen or do you have to find another home.

Wednesday, July 1, 2009

Follow the terms of your lease

Yesterday I took a client around to see a handful of condominium units in Washington, DC.
Unfortunately none of the units fit his needs ,so we scheduled a second round of house hunting.

A short while ago one of the listing agents emailed me for feedback on her property. I replied that my client liked the unit, but the unit had a smokey smell,he saw an ashtray with a cigarette in it and so he removed the unit from consideration.

The listing agent immediately emailed me back for confirmation that I was talking about his unit and not another listing we walked through because this would be a violation of the lease signed by the tenant and landlord. This post has nothing to do with smoking,but rather abiding by the terms of a lease. I could have seen a grill on the balcony,said how excited my client is that that the building allows grilling on the balcony and gotten a similar reply from the listing agent that grilling on the balcony is actually a violation of the lease.

One may think that it is difficult to enforce the terms of a lease on a tenant who gave notice of his/her intention to vacate and that the tenant faces no consequences since he or she is moving out. This is not the case. The tenant may have put his/her security deposit at risk. Furthermore, if the tenant is looking to rent another property,then he or she should not expect the landlord to be a good reference. Many landlords care about credit and landlord references.

No matter how "hands off" your landlord or the landlord's property manager is, you should be very familiar with and follow the terms of the lease because the owner,or in this case,the owner's listing agent found out quite accidentally that the tenant was violating the terms of the lease.
If you don't like living under the "house rules" of a landlord, it is a great time to buy.