Friday, January 14, 2022

Real Estate: What to expect in 2022 – The Housing Market

By Katie Kinney

The real estate market has been a wild ride for both buyers and sellers since the spring of 2020. We have seen record high purchase prices, extremely low mortgage rates and cutthroat competition among buyers in multiple offer situations.

The good news, according to experts, is that 2022 may bring more equilibrium to the real estate industry. Here are the key trends to pay attention to if you are considering buying or selling property this year.

Mortgage rates will rise, rates reached all time lows in the beginning of 2021, with 30 year fixed loans averaging less than 3 percent. “Mortgage rates are expected to slightly move up, to an average of about 3.5 percent,” Gay Cororaton, senior economist and the director of housing and commercial research with the research group of the National Association of Realtors (NAR) says.

Even with the slight rise, the rates will be still be low by historical standards, prior to 2020 rates were around 4 percent. While this means refinancing opportunities for existing homeowners may dwindle, borrowing will still be very affordable for new and existing buyers.

Smoother supply chains are predicted for the new year. Hopefully this change will help builders and homeowners get their homes listed sooner than later. Assuming the worst days of the past few years are behind us, home inventories should grow in the year ahead.

When the inventory rises, we should see price stability and a decline in the home buyer competition. The prediction is home prices will grow by 5 percent in 2022, compared to 15 to 20 percent growth in 2021.

Historically speaking a 5-plus percent growth from year to year is a normal trend. As far as the sell side goes, sellers should be prepared to price their homes aggressively and take advantage of the buyers still in the market.

This year should feel a little more normal to experienced real estate shoppers and calmer to first time homebuyers who have only experienced the past two years. Keep in mind, regardless of the market conditions, the advice for people interested in buying or selling remains the same. It is always important to be prepared and understand the current market. Having a knowledgeable agent at your side will make navigating listings or offers much easier.

Your realtor should also advise you on the specific dynamics of the real estate market you are listing or shopping in. < 

Katie Kinney is a broker with Landing Real Estate. Contact her by email at

katie@landinghomesmaine.com or by phone at 603-205-2276.


Friday, January 7, 2022

Real Estate: The Risks of Skipping a Home Inspection

By Carrie Colby

In the crazy real estate market we are in, many buyers are forgoing building inspections. This may make your offer as a buyer more attractive to the seller but there are significant risks in doing so. 

Just this week I put a house under contract for my buyers. While the sellers and buyers agreed on a purchase price the seller said they would be selling the house “As Is”. I recommended we go ahead and do an inspection anyway to make sure there were no major defects that would cost the buyers a considerable amount of money now or in the future.

Low and behold the inspection revealed that the septic failed and there is quite a bit of mold in the basement. Now I am in the process of finding out if the septic can be fixed or needs to be replaced and what it would cost to remediate the mold.

We will see how this pans out. Will the seller agree to have the septic fixed and mold removed? Will the seller stick to their “As Is” guns? Will the buyer decide to walk away or take on the repairs themselves?

That being said, as with any major purchase, buying a home requires a significant amount of due diligence to protect your interests and make an informed decision. A thorough, professional home inspection is a fundamental piece of the information puzzle. It’s nearly impossible to gain a complete and accurate overview of the home without it.

Here are a few of the main issues you may not learn about when you waive your right to a home inspection:

Unknown safety hazards
Without a home inspection, you may not learn about pressing safety issues that should be addressed before closing. Home inspections take several hours to conduct, and many safety issues will only be identified in the course of a normal home inspection. This includes concerns such as electrical hazards, fire hazards and carbon monoxide hazards.

Need for expensive repairs or replacements
You may think that major structural or maintenance issues requiring extensive (and expensive) work would jump out at you. Many problems that might give a home buyer pause are hidden by nature or by design, and it takes an experienced home inspector to suss them out. There is a laundry list of deal-breaking problems that have come to light during home inspections.

No maintenance plan for the home
Unlike vehicles, homes don’t come with a maintenance manual. When you get a home inspection, you’re not just getting a professional honey-do list. Home inspectors also give advice about the future maintenance needs of a home to help make sure the new owners are well-educated.

Knowing what big jobs may be coming in the next five to 10 years makes it easier to create a financial plan and be ready for them, like roof repairs or replacement, or a new furnace. Sometimes telling home buyers when to expect a repair is almost as valuable as finding major defects, as it allows you to budget,

A home inspection provides a home buyer with the information they need to consider in the overall home purchase equation. For example, a home that is selling at a lower price but will require major repairs in years shortly after the buyers move in may not be the right house for them. A better option may be to pay a bit more for a home with updated systems. <

Carrie Colby is a Broker with Allied Real Estate, 909 Roosevelt Trail in Windham. She can be reached at 207-232-5497.

Friday, December 31, 2021

Real Estate: Brighten inside your home

By Nicole Foster, Broker/ REALTOR 

Not every home has the benefit of having excellent southern exposure or receives full sunlight through the day. During the shorter days of winter, we are indoors more and many of us are inside our homes instead of the workplace or commuting. Our bodies are regulated by exposure to sunlight in a number of ways, including the production of serotonin affecting mood, feelings of well-being and calmness and Vitamin D supporting a strong immune system and more.

Whether you plan to sell or stay put in 2022 and beyond, taking a quick and objective look around to find ways to brighten up your living space is a great way for you to bring in the New Year!

Start with taking a walk around the exterior of your property to identify areas where sunlight might be blocked and unable to reach your home.  Trees which have grown very tall or are close to the house could be obstructing more daylight than you realize.  Shrubs, hedges and vines should be trimmed so they are not covering the windows. 

Some recommend painting the underside of the eaves which overhang with a bright white paint to help reflect sunlight into the windows of your home. Larger structural changes like replacing existing windows with larger ones, adding skylights or light tubes will all help to let in more natural light.

There are other immediate and cost-effective measures you can get started with to improve the lighting inside your home as well.

  1. Clean your windows. Window washing can generally fall into spring and fall cleaning routines, but some homeowners prefer to have it done more frequently. If doing this yourself plan to do it during warmer days when windows may still be left open and the outside water spigots and hoses are still connected. Window screens are best done during a warm day to dry in the sun while window glass should be cleaned on a cloudy day to reduce streaking. Different types of glass may require different maintenance so understand what to avoid by checking manufacturer’s instructions.

2. Change your lightbulbs.  Daylight lightbulbs have a much higher lumen than bright white and soft white bulbs. Try replacing older lightbulbs with new daylight bulbs and watch a room with only a single bulb be dramatically brightened immediately. While changing the lightbulb wash the globe or shade of the fixture to get rid of dust which accumulates and filters the light.  Check for any missing bulbs or ones which are not working and replace.

3. Window treatments. Curtain rods should extend beyond the window frame 4 inches to 10 inches depending on style of curtain panels to have a space for your curtains when open.  A common mistake is to mount the rods too short with little to no overhang, so the curtains constantly cover up part of the windows even when they are open all the way. This is a fantastic way to highlight the windows and make them appear larger.  Curtains and draperies which are made from heavy fabric block out the natural sunlight and can also make a room feel less spacious and more cluttered. Choose window treatments made of lightweight or sheer fabrics and panels which will allow sunlight to enter the room and help to create an airy and open quality.

4. Placement of furniture.  Deep furniture or large pieces are best situated towards the center of the room and away from windows.  Whenever possible leave the framing of windows open and unobstructed with limited knick-knacks, window décor or interruptions.  Floating shelves placed too near a window could block incoming light during certain times and items may filter the natural light so consider how the light will work when placing.

5. New doors. If you have a solid exterior door you may consider one with windows or decorative glass to increase light in a dark entry or staircase. Adding transom windows over exterior doors and side lights to your casing will also make a big impact on natural light. The use of a full glass door in place of a ho hum steel one can immediately turn a dreary hallway into a focal point without breaking the bank. Swap out a light blocking interior door in an office or library with timeless French doors to dramatically lift the whole space.

6. Reflective décor. Hanging mirrors on the wall opposite of windows will reflect the light into the room and significantly amplify a room’s natural light. The larger the mirror the more light, however even smaller decorative mirrors can also have a huge impact when hung in the right spot. Consider wallpapers with metallics or the use of a glass or acrylic coffee table in place of a wooden one or a mirrored dresser.  Choose metallic fixtures and drawer handles and pulls or add a reflective backsplash in the kitchen to brighten the room.

Adding layers of artificial lighting can now easily be achieved through the use of LED light tape, but you may try up-down lighting or wall sconces, as well, not just buying more lamps. Be mindful when making paint color and finish selections for your walls and ceilings and remember dark flooring and cabinetry will also drown out light so those rooms may need a light lift as well. These small changes to the inside of your living space are sure to brighten your days when we need it most! <

Nicole Foster is a Broker and a Windham resident who may be reached at 207-615-7558 or Nicole@locationsinmaine.com .

Friday, December 17, 2021

Real Estate: Commercial Real Estate Due Diligence

By Larry Eliason

Buyers today should consider engaging a Commercial Real Estate Professional to assist them with Buying a Commercial Property and incorporate Due Diligence as part of the process to purchase a Commercial Property. 

A Real Estate/Title Attorney should also be engaged to review the Title, Zoning, Land Use Regulations and in some cases, the Purchase and Sale Agreement before it is fully executed by the Buyer(s) and Seller(s).

Site Inspectors/Engineers are also recommended depending on the size and scope of the property.  If the subject property has always been an office building, the scope and level of investigation may be limited.  However, if the property was ever a Gas Station or a Dry Cleaner, then expect to go further into the history of the property.  Department of Environmental Protection (DEP) records can be researched to determine if any spills or contamination may have occurred at the site or adjacent to it.

Building Inspectors/Engineers can offer insight on the condition of the structure, the systems, estimate remaining useful life of those components and point out potential problems such as Mold. 

And, in the case of new commercial development, a Civil Engineer will certainly offer insight as to a property’s development potential along with expectations for costs, timelines for approvals and construction and expectations from governing agencies such as Town, State and in some cases Federal Approval.

A typical Commercial Purchase and Sale Agreement spells out Inspections, Permits and Due Diligence.  In many cases, the Seller is asked to provide any title history, surveys, engineering studies, architectural, geotechnical, storm water, utility, sewage, etc., as a request with the Seller’s documents being provided for informational purposes

The Subject Premises are being conveyed “as is” or possibly “as complete” depending on the specifics of the building or project.  The Seller generally grants the Buyer and/or his/her Agents to enter the property for reasonable investigations as part of the Due Diligence work.

The Contract should “Spell Out” to Buyer’s Satisfaction and in his/her sole discretion with its investigations, reviews, reports and findings and those specific items such as Environmental Testing specifically spelled out in the contract.   If the Buyer is unsatisfied with his/her investigation, the Contract may become null and void, can be renegotiated or the Buyer and Seller may agree to extend the contract to allow more time for Due Diligence.

As Ronald Reagan used to say, “Trust but Verify.”  Property Disclosures are a guide to a Commercial Property; however, Buyers should verify the facts as what someone thinks is the case may have changed due to occupancy by Tenants or Zoning changes by a Town or the State such as setbacks from roads, wetlands, and lakes.

It is a good idea to get a title history done early on so that any title issues may be addressed during the normal course of the contract.  A lot of times, title is done just before closing, problems with obtaining title insurance pop up and the deal must be extended to clean-up clouds on the title so an acceptable title policy may be issued.

Due Diligence on the Title can include a survey, easements of record, restrictions, exceptions, errors with legal description, undischarged liens to name a few.

Some Commercial Property Sales include the assignment of leases as the property may be a multi-tenanted shopping center.  As part of the Lease Due Diligence, a Buyer may want to see any extensions in the leases and a payment history as well as any pre-existing Landlord consent given to a Tenant.

An Environmental Site Evaluation may become a requirement for a Buyer to obtain commercial bank financing.  And this Due Diligence can help avoid inheriting potential liability such as Environmental Contamination. 

A Phase I Environmental Report can help determine the presence or likely presence of any hazardous substances or petroleum products in or at the property.   This can be due to a release in the environment or under conditions that could pose a threat of future release to the environment.  The Phase I Environmental Report generally includes a site visit, local, state and federal environmental records, historical research, interviews and visual observations.

In the event further investigation is warranted, a Phase II Environmental Report may be required.  In this case, testing is performed on site such as borings to look at soils samples and to determine an area of possible contamination.

If clean-up is required, this is what I would refer to as Phase III.    Soils may need to be removed from the site to mitigate a problem.  The remaining contaminated soils might need to remain as they are under a building or a road.  The DEP has a program - Voluntary Response Action Program (VRAP) that helps reduce the liability for a Buyer and his/her Lender.  The VRAP allows applicants to voluntarily investigate and cleanup properties to the Department's satisfaction, in exchange for protections from Department enforcement actions. The VRAP is intended to encourage the cleanup and redevelopment of contaminated properties within the state.

A property Condition Evaluation by a Building Inspector/Engineer can give Buyers valuable insight as to the physical assets associated with a particular property.  Site improvements, building components and operating systems such as HVAC can be observed, tested, and evaluated.  Building deferred maintenance, anticipated capital repairs and replacements can be prepared.  Some lenders require Property Condition Evaluations as part of their mortgage lending commitments.

Like your teachers in school used to say, “Do your homework.”  When buying commercial real estate and/or commercial land, I would urge all Buyers to do their homework and engage professionals for the Commercial Real Estate Buying process like a Real Estate/Title Attorney, Environmental Site Inspector/Engineer and Building Inspector/Engineer. <

This article was brought to you by Larry Eliason, Commercial Broker with Butts Commercial Brokers in Raymond. You can reach him at 207-415-2112.


Friday, December 10, 2021

Real Estate: Tips for Buying or Selling this Winter

By Matthew Trudel

Buying or Selling during the winter is not impossible, but it can be a little more challenging.  A large majority of people tend to avoid looking to purchase a home during the holidays.  So, if you are thinking of selling and putting your house on the market right now, this means you may have a smaller pool of buyers to work with.

On the other hand, if you are looking to buy a house right now, this might mean you have less competition with fewer buyers out shopping.  Either way, there are several other things that both buyers and sellers should be aware of and take into consideration if they are going to move forward right now.

Buying a house in the winter when there is two feet of snow everywhere can present several challenges and concerns.  One is that it is pretty hard to complete exterior inspections when there is snow all around the house and foundation.  Also, if the roof is covered in ice and snow then is pretty much impossible to inspect the shingles and determine the life expectancy of them. 

Another issue is being able to see the yard, landscaping, and condition of the lawn when it is covered with snow.  There are some positive aspects to looking at homes during the snowy winter months.

One thing you will be able to see about a home when we have a lot of snow is how easy or hard the snow removal process might be.  For example, is there adequate room to plow or shovel the snow?  You will likely be able to tell where there might be issues with ice dams on the roof.  The steepness and ice build up on the driveway is another potential issue you can identify.  Does the driveway get a lot of sun light which might help melt any ice build-up on the driveway?

Selling a house during the cold snowy months of January or February has its own set of challenges and can be a lot of work.  Keeping all the walkways and driveways cleared of ice and snow is just the beginning.  Keeping a path cleared around the house so buyers can get around the house easily can be very time consuming.  Hopefully you took some nice pictures over the summer of the landscaping and yard so buyers can see what it looks like in the warmer months.  Unless of course your lawn doesn’t look so good then it being covered in snow might be a positive thing.  Keeping your house clean is a little harder when you have buyers coming in with snowy or slush covered boots. 

You will also want to keep the heat close to 70 degrees or a little higher for showings.  A warm home sells a lot better than a cold house does.

There are some positives for selling your house this time of year.  There are fewer homes on the market which means you have less competition on the selling side.  There are fewer homes on the market because most people don’t like moving in January or February when you have to deal with snow, ice, and bitter cold weather. 

On the upside, this means the buyers who are out there looking at homes are serious buyers. 

So, whether you are a buyer or a seller and think you want to get in the game now, make sure you find yourself a REALTOR to work with and assist you in the process - someone with experience and knowledge of the area who has the time to devote themselves to whatever your real estate goals might be.  Remember that interest rates are still at all time lows, so buyers have more purchasing power which results in higher selling prices.  <

This article was written by Matthew Trudel, the Owner of Five Star Realty in Windham. Call him at 207-939-6971.

Friday, December 3, 2021

Real Estate: Should I sell my home myself or should I list it with a real estate agent?

By Richie Vraux

I know, the first question will be, If I sell my home myself- I can save myself thousands of dollars and I wouldn’t have to pay a Realtor. But, will I run the risk of doing something wrong that could cost me way more than I would have saved by not listing with a Real Estate Agent.  Make sure you know the drawbacks of selling it yourself. 

A Real Estate agent has to take several hours of classroom studying  through an accredited Real Estate school to learn how to sell, what to know to keep out of Real Estate jail. Then there is a state section you also have to pass on. He/ she then has to take continuing educational classes consisting of at least 21 hours to maintain their license. These classes keep us up to date with the latest trends and newest rules and regulations set forth by the Realtor “Code of Ethics” and the “Real Estate Commission.”

Questions you should ask yourself are, what are you going to price your home out at? Will you know what is required to have to sell your home by the state of Maine. Do you know there is a transfer tax that both the buyer and seller have to pay on every transaction? Do you know there is a 2.5 percent withholding tax if you live as an out of state resident? Do you know that, in the event you, the seller, do not pay this, then the buyers are on the hook to pay it. That will make for unhappy buyers. If you have an experienced agent working for you, he will know that if you bought your home years ago, most likely you have made improvements. You might be eligible waive the withholding tax. An experienced Real Estate Agent will guide you how to file a REW5 with the state of Maine. Would you know how to handle these things yourself, probably not. Your real estate agent will guide you properly.

When setting the price to sell your home, will you know how to price out your property to get the highest and best price. An experienced agent will know your neighborhood and know where to place your home to yield the highest price. When an agent writes up the disclosures on your home, he lists all your systems, the condition of every system and lists any improvements and any deficiencies you will need to expose. He/ she knows what should be mentioned to keep you out of court. Do you know if your garage or shed is actually on your property or is it encroaching on your neighbor’s property?

If you thought that you might have saved yourself a boat load of money by selling it yourself, if the buyers take you to court because you didn’t share all the deficiencies that you knew were wrong but didn’t disclose it, you just might be paying out way more than you made by selling it yourself.

Another risk is knowing who you allow into your home. A realtor will have already met up with them. Because of the news you hear of today, with questionable people coming into your home, you might want to have an agent there.

A Real Estate Agent will only work in your best interest when selling your home. There are lots of reasons to have an agent sell your home, but the biggest reason is your piece of mind and knowing your agent best represented you and your interests. <

Richie Vraux is a real estate broker with Maine’s Premier Team at Better Homes and Gardens- The Masiello Group. Call Richie If you at 207 317 1297 for Real Estate advice.

Friday, November 19, 2021

Real Estate: A homeowner’s guide to fall home maintenance

By Jonathan Priest

Fall brings colorful leaves and cooler temperatures, but seasonal home care should also be on the calendar because winter has no mercy on homes unprepared for its surprises. 

Roof and Exterior

A visual inspection of a home, from the chimney to the foundation, can help reveal vulnerabilities that lead to trouble when wind, freezing temperatures, snow or winter rains rule. Homeowners can use a drone or binoculars to look for debris, which will need to be cleaned up, and missing or loose shingles, which should be fixed or replaced before they lead to leaks. Overhanging tree limbs should be trimmed, so they can’t come down, potentially puncturing the roof and causing leaks, water damage and mold.

Gutters

To keep gutters running well, check them monthly for twigs, leaves and other debris. Plan bigger cleanings — including running water down all the downspouts — both before autumn leaves fall and again after trees are bare, to be sure fall and winter rain and snowmelt can flow down and away from the house — instead of into the walls, which can cause rot and mold and invite insects.

Landscaping

Some experts note that grass will fare better if it is fertilized after the hottest days of summer are over, when the fertilizer can encourage blade growth and strengthen the root system for winter. Rake off all leaves and give the lawn a final mowing once it stops growing. (A local garden center can guide you on fertilizer formulas suited to your climate and lawn.)

Outdoor pipes and water sources

Frozen water can burst pipes and hoses. Garden hoses should be detached and drained. Outdoor faucets can be left on to drain after water to the outside is shut off, says Mark Dawson, chief operating officer of a chain plumbing business. He notes that irrigation systems should be blown out using an air compressor or risk freezing — and having to replace irrigation lines come spring.

Deck

Sealing a deck can help prevent damage from rain and snow. That means repairing or replacing loose or cracked boards, washing off dirt and mildew, vacuuming and applying a wood sealer. If a path through the snow on a deck is needed, consider using a shovel with a plastic or rubber blade to avoid damaging the wood.

Outdoor furniture

Umbrellas and furniture that could be blown over can be brought inside or stacked and weighted down, to reduce the risk of damage. Grills should be moved indoors and outdoors appliances such as mini fridges should be unplugged.

Indoor Maintenance

Doors, windows and other drafty spots

To keep houses warm without sending heating bills through the roof, and to save energy, the federal Environmental Protection Agency recommends sealing spots where cold air can sneak in, focusing on the attic, foundation and around windows and doors. Caulking, weather stripping and door draft guards can be inexpensive DIY fixes.

Attic

Insulating the attic and sealing all gaps and cracks around recessed lighting, plumbing, chimneys and other breaks in the attic floor — any place where warm air can escape and cold air can sneak in — is the top recommendation of the nonprofit Center for Energy and Environment. It pays for itself quickly in reduced heating costs.

Heating

A good time for an annual HVAC system check — to look for wear in parts like the blower motor — is before having to turn on the heat, according to the International Association of Certified Home Inspectors.

Also, check with local utilities to see if they offer free energy audits or rebates for energy-efficient appliances, including furnaces. It is also good practice to change furnace filters every 60 to 90 days.

Basement

Along with cleaning gutters, making sure a basement is ready for winter means checking the foundation for cracks, which freezing water can widen and make for a very expensive repair. Sump pumps need to be checked for wear.

Miscellaneous

Fall is a good time to test smoke and carbon monoxide detectors and replace batteries, according to the National Fire Protection Association.

Update first-aid kits for home and vehicles, replace flashlight batteries and check that emergency go-bags are stocked with fresh water, food, medicines and weather-resistant supplies to last at least 72 hours.

The big payoff is savings on repairs — and peace of mind. <

This article was brought to you courtesy of Farmers Insurance agent, Jonathan Priest with an office at 57 Tandberg Trail, Suite 7, Windham.