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Don’t Forget the Trees

When you’re buying a home, it’s common to consider the kitchen, bathroom, living space, and other indoor amenities, but don’t forget the outside, especially the trees.

Trees are a bigger part of real estate than you may think. For one thing, you may find that you prefer older neighborhoods, and established trees are a big part of the appeal of these areas.

Trees also affect property values: well-cared-for, mature trees add value, whereas poorly maintained trees can be a significant detraction. According to the International Society of Arboriculture, a tree’s value is based on four factors: tree size, tree type, tree condition, and overall tree location based on its functional and aesthetic purposes.

Residential lots with good trees are a wise investment because landscaped homes are more valuable than non-landscaped homes.

It’s not just about how the house looks, either. Rising energy costs are a concern these days—you can use trees to save on energy. Well-placed, established shade trees are a good way to keep the sun away from your home and lessen your cooling needs during our long Texas summers. It’s difficult to quantify the savings due to many variables, but savings can approach or surpass 10% of a summer electric bill.

Trees don’t just provide relief in the summertime, either. Consider a species like cedar for use as a windbreak from the cold northern air that blows during winter. You may find that you can enjoy similar savings from keeping that wind off your home during the heating season.

There are benefits to large trees, but there are maintenance issues and cost to consider, as well. What’s the tree’s life cycle? Is it healthy and in a smart place? Will the tree need trimming? Also, remember that trees spread out underground as much as they do above ground, so consider the proximity of the tree to the home’s foundation and underground plumbing.

Additionally, pruning or removing trees, especially large ones, can be dangerous work. Work of this nature should be done only by those trained and equipped to work safely in this environment.

Even when weighed against the cost of purchase and maintenance, trees are an important consideration in a real estate transaction. Strategically placed trees can improve energy efficiency in both the summer and winter, make your home more desirable, and have a positive environmental impact.

Texas Association of Realtors®

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Making a Good Offer

When you’ve finally found your dream home, making an offer is the next step. Make sure you’re working with a buyer’s agent, so you know you have someone looking out for your best interests. A buyer’s agent will help get the best deal possible, assisting you with negotiations, paperwork, and the myriad other details involved buying your dream home.

When coming up with an offer amount, keep in mind that some sellers may get offended with an offer significantly lower than their asking price. Though their selling agent should counsel them not to let emotions get in the way, some people will see your low offer as a personal insult. That doesn’t mean you shouldn’t make an offer substantially lower than the asking price. Perhaps you think that’s the fair value of the property. Just know that you may not hear back from the seller.

Many times a seller receives more than one offer at a time, and it’s up to you and your buyer’s agent to make your offer look as attractive as possible. After coming up with your offer price, you must also determine how much earnest money will accompany your offer. This money is used to show the seller that you are serious about purchasing the home and acts as a “good faith” deposit.

There are other ways to make your offer attractive. Talk with your Texas REALTOR® about the best game plan for making your offer look at appealing as possible.

Texas Association of Realtors®

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Understanding the Lingo – Comps

So, you’re selling your home and every single Texas REALTOR® you interviewed to list your home has mentioned “pulling comps”.  Not wanting to appear uniformed, you just nodded your head and played along.

So what is a comp? Simply put, a comp, short for comparable, is the primary set of data used in determining the value of your home.  Comps give you data from all the recently sold property in your neighborhood.  Some of the different data you see might be the age of the house, the square footage, and most importantly, price. Your Texas REALTOR® may use these data to create a Comparative Market Analysis for you.

In any real estate market, the more recent a comp, the more accurate it is. Obviously, the availability of recent comps depends on how active the market has been in your area.

Generally speaking, the most significant comps are those that are closest to your address. This does not account for differences such as one house having a view of the lake, which will add value, or a home backing up to a railroad track, which will detract from the value.

Price per square foot is a significant and well-tested method of comparison, although straight comparison can be deceiving. You can see a big discrepancy if, for instance one property has been neglected and another of exactly the same size, just two doors down, has been well cared for.

Lot size is a factor as well. A 2,400 square foot house on a four-acre lot may sell for quite a bit more than an identical house on a .33-acre lot.

Other factors may include nearby amenities, traffic concerns or access to a main road, landscaping and curb appeal, and the general condition of the exterior of the house—such as the driveway, roof, chimney, or fence.

In the end, it comes down to what the buyer’s bank’s appraiser says the property is worth. That appraiser may use comps to generate his appraisal, but banks or lenders do not take comps into account when considering the amount to loan the buyer; they will only consider the appraisal.

The point is this—there are many factors to sift through when evaluating comps. If you have questions, your REALTOR® should be able to decipher these data and explain the methods she used in pricing your home.

Texas Association of Realtors®

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Buyer Tip – Closing Costs

Everyone knows that in most cases you’ll need at least a small down payment to purchase a home … but that’s not all. You’ll also need to come to the transaction with money for closing costs, which can be sizeable.

Your lender is required by the Real Estate Settlement Procedures Act (RESPA) to provide a good faith estimate of your closing costs. This estimate is an itemized list of fees you’ll pay to get a loan.

Mortgage closing costs cover things like appraisals, attorney fees, title insurance, taxes, and other expenses associated with getting a loan.

A property appraisal is generally required by a lender before loan approval to ensure that the mortgage loan amount is not more than the value of the property. An appraiser is needed to make this determination.

A survey of the property is usually required to verify that boundary lines for your property, easements, and fences are where they’re supposed to be.

You’re about to buy the home … after that, you’ll own it, right? Well, in some cases, there may be a lien on the property, or some historical dispute to your right of possession. A title search fee is paid to the title company for doing detailed research on the property records for your home. The title company will look at prior deeds, court records, property and name indexes, and many other documents. This is to ensure that there are no liens or problems associated with your ownership of the property.

You’ll need homeowner’s insurance, which covers the costs of rebuilding should an insured event occur. In some cases, your first year’s insurance may be paid at closing.

Other fees that you may see include attorney fees, courier fees, pest inspection, plat drawing, underwriting, flood-zone certification, document preparation, and others.

It’s important to check your lender fees and closing costs carefully, and don’t be afraid to ask for advice … the only bad question is one that you don’t ask. This is where your Texas REALTOR® can really help.

Texas Association of Realtors®

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Design Trends

“Design can have such a positive impact on the way people live and on their relationships and moods.” – Genevieve Gorder

Not all remodels are created equal. You may already be familiar with Remodeling magazine’s popular Cost vs. Value report, which documents the average return on investment expected for specific improvement projects. But have you taken into account the latest design trends that will make your home more desirable and thus more valuable?

For example, many buyers are seeking homes with hardwood, composite or travertine tile
flooring because they require less maintenance than carpet and give a home a beautiful and natural feel. Replacing carpeted areas with these contemporary flooring options can give your home a worthwhile face-lift.

This month’s Item of Value is dedicated to new design trends around the home. You will
find innovative and affordable tips that can dramatically improve your home’s look and value, such as adding accent lighting and replacing outdated plumbing fixtures.

Specific ways you can stage your home successfully for an open house or merely to entertain friends and family are also included.

My hope is to keep you informed of the latest trends in home improvement and design.

Sincerely,

Alan Hopper

Oh, by the way®…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number, and I’ll be happy to follow up and take great care of them.