Don't Forget To Request A Quick Status Report On Any Homes Or Properties That Interest You! 

It can take days, weeks, or longer for changes to appear on web sites. Don't waste your time with less than current information. Request my free Status Report and find out if the homes you are interested in are still on the market, under contract, in escrow, or if the price has been reduced. 

The Status Report that you'll receive by email will also include other important information that has been left out or that is available to me through my professional resources, such as how long the property has been on the market, when it was last sold, what it sold for, and more. 

Remember: As a top Columbus, Westerville and Lewis Center area real estate agent, it's my job to know more about a property than any web site. Make sure you have the most current information! 

YES, I'M THINKING ABOUT BUILDING! 

If owning a home is the American Dream, then building your own home is the epitome of the dream. Short of deciding to have children, building a home is probably the most challenging experience many of us will encounter. Building can be exciting, even thrilling; but occasionally is nerve-racking and as a worst case, disastrous. This is not a project for the weekend do-it-yourself type person. Only patient people should attempt to build. 

If you are seriously considering building in the near future (or anytime for that matter) there is much homework to do. Fortunately, I'm here to help you. I realize you must have incredibly busy schedules but you should plan time to research builders, neighborhoods, the construction process and many other factors if your considering the “World of New Construction”. 

Once you decide you will probably build (before you wander through model homes) take the time to select a competent Realtor who is familiar with new construction and the process. The majority of the people I met are surprised that you NEED a Realtor to help you if you are going to build. People assume that because there is a salesperson at the model to answer questions and complete the paperwork that they do not need a Realtor. They know that the Builder will be paying their Realtor and they assume the builder will reduce the price of the house if they don't use a Realtor. However, this is NOT the case. 

There are two important facts you need to be aware of. First, the builder pays the commission no matter what. If you have a Realtor, the commission gets split between your Realtor and the builder's sales agent. If you walk into their model with no Realtor when you sign the contract, their sales agent gets the entire commission yet you have no representation. Secondly, no matter what field you are in or how thorough you are, you may nit have the knowledge or background you need to protect yourself when writing the contract and working on this and other countless details that go into building a house. UNLESS you have a Real Estate background. Even if you're familiar with Real Estate Laws, codes and local building requirements, it is important to find a reputable and knowledgeable Realtor to represent you. 

If you have not built a home before you will find it to be a new experience. It helps tremendously to have someone on your side who has been there before. It is important, therefore, that you select a Realtor carefully. Not all Realtors are created equal. Background knowledge and experience vary widely from Realtor to Realtor. A Realtor who has experience related to building will be much more valuable than one who has none. Interview Realtors until you feel comfortable with a Realtor and feel confident they will represent YOUR best interest through the new build process. 

Questions to ask: How long have they been selling Real Estate? Have they sold new construction? If so, in what areas and in what price ranges? Are they very familiar with the differences between custom builders and track or “spec” builders? Can they do more for you than sign up to get a commission check? Do they sound knowledgeable as you are speaking with them? 

It is wise to select a Realtor BEFORE you start touring model homes. a Realtor is able to help you with building information and various Builder promotions not necessarily available to the general public. Realtors can also provide information on specific builders to help determine your initial direction and the Builder best suited for you and your budget. In addition, it is extremely important to register your Realtor's name when you sign the registration card at the models. It this is not done, many less than reputable salespeople will not allow you to be represented by a Realtor at all. If this happens.......you are truly on your own. 

When you walk into the model home and say hello to the nice, accommodating salesperson, you have just met the agent for the builder, operating as a seller's agent. If your Realtor is not with you at the sales model please be vague in your statements. Do not show excitement or enthusiasm. It will make negotiating an almost impossible task. 

Many builder agents will state, "You don't have to have a Realtor". that's true; you don't have to have Realtor. YOU NEED TO HAVE A REALTOR. The law allows you to have a Buyer's agent, your Realtor Your Realtor will help with the building process just as though you were buying an existing home. The law allows for the Realtor to be paid a commission by the seller when the home closes. They may imply, and many people feel that the house will cost less if you don't use a Realtor; this is NOT TRUE. Any compensation given to the Realtor is recognized by the Builder as a marketing fee and has no impact on the final cost of the home. using a competent Realtor is more likely to save you money and when problems arise it will save you aggravation. 

Many builders use "non-standard" contracts, and many addendums designed by a legal staff representing them. You can be certain that the language used is designed to benefit them. Your agent knows certain details and conditions that should be discussed, added, deleted or modified for your protection. No matter what you are told, not contract is “iron clad” as it is printed. There is always an option to strike out passages (all parties must initial when this is done). Most contracts have a place for additions or further conditions, to ad particular terms for you, which were not covered by the pre-printed contract. Always remember, verbal statements from the salesperson are only as good as the paper they are written on! You MUST remember to get all details in wring and ANY changes in writing. 

Contracts are negotiated or should be negotiated between two parties NOT dictated by one party. Your Realtor should know what the Builder should do, can do and/or must do. They should be accessible throughout the entire building process to help monitor the progress from pre-construction through the final walk-through and closing. A good Realtor will also be able to advise you on which options are critical for resale and which will recover the greatest return. 

SELECTING A BUILDER

The complex process of building a home is much more than carpenters, masons and roofers assembling bits and pieces of your home. New homes today require the dynamic management of a professional homebuilder/GC (General Contractor).

The first step in selecting a builder is deciding what kind of builder is needed. There are three main categories of builders: 

*Custom builders specialize in larger, luxury homes and work loosely with you from the design state to create that “one-of-a-kind” home. 

*Production builders commonly known as track or subdivision builders have established floor plans, usually five to seen which are designed to appeal to the broad range of people with fewer alterations. 

*Semi-custom builders of “spec” builders use a combination of established floor plans but can allow for a fair number of changes. 

On average, production builders meet most needs. Most do not allow flexibility in structural changes but will allow their customers to select the styles and colors of the decorating features such as carpet, paint, cabinets, countertops and lighting. Customized changes, when allowed, cost extra and must be made within a specific time period. You need to be aware of that cost. 

There is more to a good builder than extensive advertising or dynamic sales people. The foundation for your decisions needs to be KNOWLEDGE. What is the reputation of the builder? Is the company a member and in good standing with the Better Business Bureau? Are they a member of the National and Local Builder's Associations? I recommend contacting your chamber of Commerce for the information about the Builder's reputation. Ha the Builder earned the respect of other builders? this is an important measure. How long has the builder been in business' How long in this area? Is the builder financially solvent? Do they provide a builder's warranty” Does the Builder have projects in the area and price range you desire?
The questions go on and on. Look and analyze their other housing projects. I recommend actually talking to homeowners who have been in their home for six months to a year. How was the process for them? ask them if they would choose their builder again in the future. If not, ask them why. 

Hopefully this information will help you in the selection of a competent Realtor familiar with new construction. their experience and knowledge of the process as well as their contacts with the Real Estate community will be a priceless asset as you move towards the reality of building your “Dream Home”. 

Take the time NOW to gain the knowledge that can make the difference between a successful building experience and a stressful building experience. 

CONSUMERS BEWARE: CONTRACTS ARE LEGALLY BINDING!

Today's column will be lengthy bit I feel it's necessary. Please understand that this article is addressing situations where two parties have signed a contract. 

It doesn't happen everyday but it seems to be happening more and more lately. A party entered into a contract by signing a contract on their home and then begins to have serious second thoughts. Serious to the extent that: “I just don't want to do this”. If either party to a contract fails to “perform”, various remedies are available to the other party. Either party to a contract can be sued for “specific performance” and/or for damages. one can also see repayment of any cost incurred (inspections, appraisal, etc.) as a result of the contract default. A Builder may seek damages for materials purchased, interest on the construction loan and much more! 

The contract allows for “contingencies” to end a contract that can result in the release of your earnest money. One reason for the release of the contact would be if you were unable to obtain a mortgage. Assuming this was made a contingency in your contract. The release of your earnest money may be challenged if it can be proven that you INTENTIONALLY did something to have the loan denied because you really just “changed your mind”. 

A conflict arises fairly often when a buyer does not clearly understand the amount of money needed to close the transaction or the monthly payment turns out to be higher than they were told or feel comfortable with. “Points”, “closing costs” and “prepaids” can all be confusing if it is not explained carefully and accurately. This problem can be eliminated IF you have a “good faith estimate” which details ALL of your costs and you know exactly what you're financial responsibilities are. Applying for credit mortgage approval is highly recommended, especially if you're the least bit uncertain about your financing. 

When you buy an existing home, the process normally takes several days, sometimes a week. An offer goes to the seller; there is a counter-offer, another counter-offer until a mutual agreement is reached. both parties have their REALTORS explaining the pros and cons. both parties have time to think about it and the process ends anytime one party decided they do not like the terms. Contacts are thus considered “negotiated” or “voided” and of “no effect”. 

History shows the majority of the Buyers who "change" their minds about building a home are those who do not have Realtor representation. Builder salespeople are not required to have a Real Estate license, thus very few do. They will not likely be as educated on the entire home buying/selling process. The Builder's agent presents the contract to you and it is typically implied or even stated that there can be NO changes to the contract. That simply is NOT TRUE.

Buying or selling a home is emotional in itself. Building a home is the MOST emotional way to acquire a house. Being swept away by your emotions when you're at home with your significant other is a good thing, but getting carried away emotionally while you are out “looking at models” on Saturday or Sunday afternoon is definitely a BAD THING. This picture is further complicated by four facts: 1. there is no one there to represent your rights as a buyer. 2. there is always some promotion that is about to expire so you must sign today. 3. There is another Buyer who is coming back later to put a lot deposit on the lot you really want. 4. If the Builder's salesperson notices exactly how interested you really are it makes it nearly impossible for your Realtor to negotiate anything on your behalf. 

Please understand that I sell new construction homes, representing Buyers as a Buyer's agent and also representing some custom Builders as a Seller's agent. I AM NOT trying to frighten you into using a Realtor to help you when you go to a Builder. I am trying to educate you on the process so that you know that having a Realtor as your buyer's agent when you buy from a Builder is your best protection to avoid a contract that doesn't benefit you and your financial situation. FIRST, you must sign your Realtor's name on the Builder's registration card every time you go to a different Builder or the Builder will not recognize your Realtor later. If you did not register your Realtor's name, no money is saved by not using a Realtor. The nice sales person IS NOT Realtor and DOES NOT represent your best interest. SECOND, select a Realtor BEFORE you decided to hunt for a new build. (You can't register your Realtor if you don't have one). You need a Realtor who is familiar with new construction. THIS IS VERY, VERY IMPORTANT! What you (or your Realtor) do not know can hurt you. 

I personally sell between 60-70 new builds each year. I came from a long line of Builders. My father and numerous relatives own construction companies. My first "real" job was with a construction company. Let my KNOWLEDGE and EXPERIENCE benefit YOU....and it's "FREE"! 

The responsibilities of your buyer's agent would include being sure you understand all the terms of the purchase agreement including financing. You need someone who will urge you to consider many aspects you might otherwise overlook, the possible re-sale value of the home, any drawbacks to the lots being discussed, the impact of surrounding areas, true cost of the home, not only the base cost but also the amenities you add plus “options” such as appliances, window coverings, patio or deck, fireplace or air conditioning. Your Realtor will help you focus on what exactly you can expect for up front and future costs. 

When a builder has a bank they recommend, or they offer you deals if you work with their lender ALMOST ALWAYS it benefits the Builder. If you understand the contract and are still comfortable proceeding, you should. 

Because sales people speak in "sales language", many people do not understand that filling out the purchase agreement and leaving a deposit means you are BUYING THE HOUSE. It does NOT mean you're thinking about it. There is no 3 day right of rescission for home sales. Under State law, you can be held to that contract, even if you didn't understand it. Many, many people forfeit their deposit once they change their mind and the builder can still sue for “specific performance” or many other additional “damages”. 

Be forewarned; get someone to HELP you understand the contract. Please notice I said HELP. The bottom line is; your name is on the contract; you're the one who made a commitment. Any legal repercussions will be against YOU. Usually neither your agent nor the builder's agent will suffer a loss. You MUST take your time, KNOW what you want, STAY within your budget, UNDERSTAND the money outlay, and NEVER sign a contract with blank spaces (simply draw a line through the area). 

It is important that you don't do anything until you've had plenty of time to consider all your options....SLOW DOWN. Take a blank contract home and study it. W-A-I-T, if you are not sure. ASK more questions and be sure the answers make sense to you. Remember, CONTRACTS ARE LEGALLY BINDING. 

If after reading about the process you still feel you DO NOT need a Realtor, I would advise you to hire a Real Estate attorney.