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Starting in January 2009, Condo loan guidelines will be even more difficult for home buyers.  Fannie Mae &  Rising RatesFreddie Mac guidelines will change which will affect nearly all conventional condo loans.  But, FHA loans should not be affected (good news).  The major change is a pricing adjustment  that will increase the interest rate for the following condo loans.

  • Buyer is putting down 25% or less (Loan to value percentage exceeds 75%). 
  • If a condo loan term is great than 15 years

The approximate rate increase on these types of condo loans will be 1/2% or higher.

These new condo guidelines would have affected nearly 99.999% of all condo owners that I have helped since 1996.  This is a ridiculous new change that I think will really hurt condo sales in the Columbus, Ohio area.  We are moving in the wrong direction if we want to try and help the real estate and mortgage industry recover.

Good luck out there!

Home Buyer Advocate Mike

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Taxes

Taxes

Franklin County has a great automated monthly prepay system for paying your real estate taxes that will pay you interest.  The Franklin County Treasurer will pay the “average Joe” home owner the same interest rate that the Treasurer earns on its multi-million dollar portfolio.  This is really a groundbreaking achievement for the Franklin County Treasurer’s office.  The Treasurer sought and obtained a change in state law that allowed them to pay interest on monthly tax payments by home owners.  Banks are still NOT allowed to pay interest on escrow accounts that collect property tax payments.

The interest rate that you can earn from the Treasurer’s office will be a better rate than most short-term bank accounts (checking, savings or money market accounts).  For example, in 2007, the Treasurer’s interest rate fluctuated between 3.5% – 5.5%.  Last year, I had a so called “high yield money market account” with an investment company that only earned between 1.75% – 2.25%.  I think the Treasurer’s new monthly prepay system for real estate taxes that also pays interest is a first-rate service.   Many homeowners in Franklin County are not even aware of this service.

A  Franklin County home owner could possibly earn a couple hundred dollars a year.   For example, a $265,000 home in Franklin County with yearly real estate taxes of $5,000 a year would have approximately earned $200 – $220 in an interest credit for 2007. The interest that you earn will be credited back against your real estate taxes, to LOWER your taxes!  To get more info, you can visit the Franklin County Treasurer web site.  The process is very simple and easy to set up.  You just have to fill out one simple form.

If you are currently escrowing your real estate taxes with your lender then you will need to check with your lender to see if you are eligible to stop the escrow of real estate taxes.  Most lenders will allow you to stop escrowing for real estate taxes if you have 20% – 30% equity.  But, every bank has different policies and procedures, so before you do anything make sure you first check with your mortgage lender.  You want to make sure you are eligible and there are no fees or costs involved to stop escrowing for your real estate taxes.

As of right now, Franklin County is the only local county in central Ohio that offers this great service.  If you have questions, you can contact The Treasurer’s office for more information  (614) 462-7515. 

I think this is a wonderful service by our Treasurer’s office.  A great benefit for being a home owner in Franklin County.  You have the “worry free” convenience of automatic monthly payments of your real estate taxes that also pays you a great short term interest rate that you probably can’t get at any bank.  And best of all, the Treasurer’s program is FREE.  There is no fee or set up charge to join the program.

Shake Down!

Shake Down!

Don’t let the “Tax Man” shake you down!   Click here for other possible ways to reduce your property taxes and/or save some “greenbacks”! 

HomeBuyer Advocate Mike

 

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Last week, The Homebuyer’s Advocate Blog was used as a reference for a  good article in the Columbus Dispatch by Jim Woods – Moldy Home Cost Builder $3 Million.

 

Jim put out a thorough follow up article about the moldy Maronda house and resulting lawsuit that has been in the news for the past few months. 

 

Our very popular blog post (over 500 views) in late February reported on the same Maronda issue – Maronda Home Verdict Cost Nearly $3.2 Million.

 

I especially liked the way Jim “touched” on the Reynoldsburg Building Department signing off the home.

 

The house passes all building code requirements, but yet the south side of the house was not attached to the foundation and was inadequately attached on the other three sides.  This was hilarious and sad all at the same time.

 

I’m sure I wasn’t the only person reading this article and saying “hmmm, how does that happen?”

 

How new homes pass building inspections & get occupancy permits is a mystery to most consumers & home owners.

 

I think the Columbus Dispatch has the start of whole other investigative exposé

 

I’ve heard many stories from experienced home inspectors that talk about the same problems and issues with homes passing building inspections.

 

For example, a home can pass plumbing & electrical inspections but yet have water leaks and no working lights.  There are two main reasons why these problems sometimes happen with building inspections.  First, many building inspectors just check to make sure homes are built to the correct specs, materials, items, hardware, clearances, etc.  As long as a home is built to the correct specs and material it could possibly pass a building inspection.  The second main reason why bad homes pass building inspections is human error.  This happens even in spite of pressurized plumbing checks and other tests on mechanical systems.

 

I think it is about time to stop beating a dead horse.  It is time to move past the issues of some new home builders in Central Ohio, like Maronda and Dominion homes. (Another Builder Casualty)  The last few years, their issues have been thoroughly documented in every type of media & press publication.  If you are an informed home buyer in Central Ohio then this is all old news.

 

The key phrase above is “if you are an informed home buyer“.  I’ve been an Exclusive (true) Buyer Broker since 1996.  I only represent residential and investor buyers.  I’m sorry to say that the definition of a truly informed home buyer varies greatly.  In most situations, a home buyer will spend only a few minutes researching the home buying process on the Internet sandwiched in between their favorite TV shows, American Idol and Dancing with the Stars.  In one short evening a potential home buyer thinks they have thoroughly researched everything they need to know about the home buying process.

 

The reason this occurs so frequently is because researching on how to find the best representation possible for a home buyer is not fun and feels too much like work.  Home Buyers just want to look at beautiful pictures of fabulous homes.

 

The first and most important decision a home buyer needs to make is who will represent them, NOT which home they buy or what builder to use.  An Exclusive Buyer Broker (EBA) is the highest and best representation possible for any home buyer.  Would an EBA been able to protect the buyer that purchased the moldy Maronda home.  Maybe, yes or no.  There are no 100% guarantees in life.  A  true Buyer Broker (EBA) isn’t  always going to be a “Knight in Shining Armor”.  But, we are the best base or foundation of having a successful home buying transaction.

 

HomeBuyer Advocate Mike

 

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Forbes.com just released their top 10 “up and coming” tech cities in the USA.  Columbus, Ohio was ranked as the #1 up and coming high technology city in the USA.  I’m sure many people were surprised to see Columbus at the top of the list.  Two major reasons why Columbus leads this list.  Number one, Columbus is home to one of the largest universities in the world – The Ohio State University (Go Bucks!).  Number two, Battelle Memorial Institute has been based in Columbus, Ohio since 1932.  Battelle Memorial Institute is the state’s largest research center.  This is great news for Central Ohio.

HomeBuyer Advocate Mike

 

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On Tuesday, February 19, 2008, a couple in Franklin County Court won a jury verdict against Maronda Homes for nearly 3.2 million dollars.  The couple, Roman and Jennifer Cosner alleged that Maronda Homes knowingly sold them a defective home.  The jury verdict in favor of the homeowners stated that Maronda Homes did sell a defective home and that Maronda was aware of that fact.  Maronda acted in an “unfair, deceptive or unconscionable” manner.

Maronda has always had a reputation for building the biggest square footage home possible at the lowest price.  No other local production home builder can even come close to the price and square footage of Maronda Homes.  There is usually a reason why this happens.   It is not really complicated.  Home owners should stop being so naive.  You buy the lowest priced “anything” and you are going to have problems.  I don’t care if you buying a new home, a toilet seat or a widget.  You get what you pay for!!!!  Like many home builders, Maronda has had it’s fair share of unresolved consumer complaints.

In my opinion, this could be landmark case for new home builders.  The jury ruling in this case has now set a precedent for all future, similar cases.  I would be really curious to see how this affects the policies and procedures of other builders in our area.  I bet many builders are now “scrambling” to figure out how to adjust their business practices to deal with this jury verdict.  

I’m glad the home owner had won their court case.  But, I guarantee you, that they probably didn’t use an Exclusive Buyer Agent to help them purchase their new built home.  If they had the proper Buyer Broker representation looking out for their best interest then this problem probably would not have happened.  As consumers we have to be accountable for our bad decisions or lack of…..

Stay tuned for future posts on this topic.

HomeBuyer Advocate Mike
Representing People, NOT Property!

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It is still a great time to be a home buyer in the Columbus, Ohio area.  But, in my opinion, the real estate market has now started to turn in Central Ohio.  The market will gradually start shifting back to a normal market which is typically a Seller’s market.  There are 3 to 4 reasons why the real estate market in Columbus, Ohio is finally starting to change. Rising Rates!

Reason number 1:  Mortgage rates bottomed out at a few weeks ago at a low of 5.125% – 5.250%.  We have seen the end to flat, low home prices and super low mortgage rates.  Everything will start to rise  (interest rates and house prices) from this point forward.  I predict, in the next six to nine months will still see rates in the range of 6.00% – 6.75% and home prices just modestly increasing.  As home buyers we can’t really complain, mortgage interest rates in the “6” range is still really good.

Reason 2:  President Bush will sign the economic stimulus package in a few days.  In financial terms, the 170 billion+ package will not actually do that much to improve the economy.  But, it will help a little.  The main benefit of the economic stimulus package is that the consumer confidence in the economy and our government will increase because we were able to get something accomplished, even though that “something” was very small.

Reason 3:  My personal buyer activity has increased dramatically in the last 10 – 14 days.  I’ve been receiving a lot of phone calls and emails from interested home buyers with questions and looking for help.

Reason 4:  It’s all about supply & demand.  The inventory in the last 9 months has continued to drop drastically.  The end of last Summer we had 21,000+ listings on our multiple listing service(MLS) system. As of right now, we have a little more than 16,300 listings.  Granted the drop in the listings is mainly due to the slow winter and holiday season.  But, it is still a significant decrease.  Even with the listings going down, we are still at insanely high inventory levels.  The key months to watch inventory levels will be May, June & July.  How these three months go will probably predict the rest of 2008.

This is my prediction on where we are headed in 2008 for the real estate market in Columbus, Ohio.  Back in September of 2007 (about 5 months ago), I correctly forecasted in 2008 that we would see all mortgage programs with rates well under 6%.  Review my 5.99% or Lower blog post.  I did receive a few emails and phone calls from lenders that didn’t think I knew what I was talking about.  These lenders didn’t think rates would go that low.  I guess I got lucky on that forecast.  Again, I could be wrong or I could be right on my latest prediction for 2008.   I still think 2008 will be a great year for home buyers.  But, the buyer’s market is sort of over.  Good Luck!

HomeBuyer Advocate Mike

 

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Finally a good article that fully explains everything the consumer needs to know about buyer agents.  Broderick Perkins with deadlinenews.com has put out one of the best articles that I could find explaining the differences among “so called” buyer agents.  Fake Buyer Agents have always been a problem for the average home buyer.  Hopefully, similar articles will follow in the future.  Watch out and good luck out there!

 

HomeBuyer Advocate Mike

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Another builder is leaving the central Ohio market.  Beazer announced on Friday, February 1st that they will stop building new homes in the Columbus, Ohio market.  New home builders have really been affected by the real estate slow down.  Beazer is the second major new home builder to pull out of our market in the last year.  Last Summer, Centex homes stopped building in our area. 

HomeBuyer Advocate Mike

 

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Finally some good news for Central Ohio home buyers.   Cincinnati’s largest home builder, Fischer homes will be entering Framingthe new build home/condo market in the Columbus, Ohio area.  Fischer homes saw a good opportunity to finally enter the Central Ohio market.  Fisher homes was able to purchase land and lots from Centex homes, that pulled out of the Columbus market last year.  Fischer Homes acquired more than 280 lots in Central Ohio.

Fischer Homes appears to be a fairly strong builder with a good reputation.  As an Exclusive Buyer Agent I looking forward to working with my new home build clients to compare Fischer Homes to the other good home builders that are already established in our market.  The increased competition with new home builders will be GREAT for my buyer clients.  In my opinion, the competition between builders will increase QUALITY and LOWER PRICES in the long run.  For more information on buying a new build home or condo check out this section in our main company web site.  Good luck to Fischer Homes!

HomeBuyer Advocate Mike

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Staging homes is really “storming” the real estate industry.  In the past few years, staging homes has become an increasingly growing “cottage” industry within the real estate market.  In 2007, The National Association of Exclusive Buyer Agents (NAEBA) surveyed their  brokers & agents and found that 82% of the respondents stated that buyers were likely to get distracted from important issues when viewing a  staged home.  In addition, 51% of the respondents noted that staged homes often cover up Home Interiormajor defects and structural damage.  NAEBA is a small, international, professional trade organization that works to represent the best interests of the real estate buyer.  A recent article by columnist Blanche Evans with Realty Times ATTACKED NAEBA’s position on home staging.  Blanche’s article is one of the most biased pieces of journalism that I’ve ever read!   In Blanche’s article she states that “NAEBA is a spoilsport when it comes to staging homes” and NAEBA’s position on staging is SILLY and can possibly do serious damage”  Blanche’s article continues the trend of “old school”, traditional real estate brokers, insiders, agents, etc. that just don’t get it.  Blanche’s article is just preposterous!!!

OK, let’s try and help all the “confused” Blanche’s in the world.  First of all, Blanche is correct that a home-buyer’s decision (right or wrong) to purchase a home is always going to be based on three factors:  emotional, practical and financial.  A buyer agent’s responsibility is to properly advise their clients not to rely too heavily on the emotional aspect of buying a home.  As buyer agent’s, we believe our home-buyers decision process should be ranked:  financial, practical and then emotional.  The sole intention of staging a home is to get the buyer emotionally attached to a home.  So, why attack the “spoilsports” at NAEBA?                  Vase

There is nothing wrong with staging homes.  Right now, staging homes is “red hot”.  In the past, staging homes was limited more to higher end properties.  Not anymore, sellers can spend a few hundred dollars to thousands of dollars to stage their homes.  Done the right way, staging a home is another excellent way for the seller to market their home.  But, I have no doubt, that the increased emphasis and “frenzy” on more elaborate ways to stage homes will definitely increase abuse and deception by the sellers.  Sellers will be more likely to try to hide defects in their home through staging options.  For example:

It is OK to add small furniture to make rooms appear bigger, but NOT OK to position furniture to hide holes in the walls or termite damage.

It is OK to play soothing, pleasant music as long as you are not trying to hide, “clangy” plumbing pipes.

It is OK to have cookies baking and pleasant smells as long as you are not trying to hide dingy mildew/mold smells.

It is OK to add a nice, expensive rug as long as you are not hiding a stain in the carpet or damaged wood flooring.

All the examples above are based on a seller NOT disclosing these issues or problems in a state required disclosure form (if applicable).  Most states require sellers to provide a disclosure form to potential buyers.

It is a buyer’s agent responsibility to protect their clients by uncovering issues or problems that are listed above in the examples.  I do not want to diminish the responsibilities and duties of the buyer’s agent.  But as staging becomes more prevalent then deception by sellers is going to occur no matter who the buyers have protecting them.

I can GUARANTEE you that the increased emphasis on more complex and elaborate home staging will increase the number of sellers trying to hide major issues that they should have disclosed (ethically and legally).

”So, be careful out there” – Sgt. Phil Esterhaus, Hill Street Blues

Now let’s end this post on a lighter note.  The all time FUNNIEST home staging mistake that our office has seen was when a seller left a ”porn” tape on a bookshelf right below their framed picture of the Ten Commandments.  No joke, this funny staging “faux pas” did actually occur with one of our agents and their buyer client.  Post a comment to this blog post, if you have a funny or deceptive staging story that you would like to share.

HomeBuyer Advocate Mike

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Buyer's Resource Realty Services 7100 N. High St. Suite 204 Worthington, OH 43085
614.321.9577

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HomeBuyer Advocate Mike


Representing People, NOT Property in Columbus, Ohio. If you are a home buyer, then you need me to protect you. I can help you get the best price and terms for your next home purchase. You must use a true Buyer Broker! 1.614.805.7607

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