Protect Yourself When Buying A Home!

Your home – the house you purchase and live in – is a big investment!  For most of us, it is also the best investment we will ever make, growing in value year after year.  But things can go wrong with your dream home, too.  The roof could leak, the plumbing might fail, the air conditioner could die, the property could flood.  Protecting your real estate investment begins even before you own your home.  That’s why, in a typical home purchase, there are a number of mechanisms in the process designed to protect the investment the new home owner (and the lender) are making.  In property purchases where a mortgage is obtained, some safeguards may be required by the lender.

The Survey clearly defines property lines and reveals any encroachments.  It should be completed during the due diligence period. It ensures that nothing belonging to the property being purchased is crossing the line into a neighbor’s property.  The most common example of this kind of encroachment is the fence that is actually a foot into the neighbor’s yard.  Survey issues are rare and when they do occur they are usually solved easily.  However, I did hear of a situation where a neighbor’s room addition was actually a foot and a half over the line and into the subject property.  That sale fell through and the seller and the neighbor had to negotiate a solution to the problem, but it was the Survey that protected the purchaser and the lender from making a bad decision.

The Appraisal creates a comfort level for the lender – and the purchaser – that the property is actually worth what the buyer is willing to pay.   The Appraisal should be completed before the end of the due diligence period, and if you are using lender financing, will be ordered by your lender. Appraisals can be wrong, but usually not by much.  There is an appeal process for appraisals that are too low and there have been times when we have gone back to the appraiser with our own set of comparable properties to make a case for an appraisal adjustment.  Because most purchase agreements with financing are ultimately contingent on the buyer being able to obtain a mortgage,  when the property doesn’t appraise – and the lender therefore refuses to lend – the buyer has an ‘out’ so long as the due diligence period has not expired.  Often, however, what ensues is a negotiation between the buyer and seller through their agents about how to adjust the price and salvage the sale.

The Flood Certification attests to whether the property is located within a FEMA designated flood zone.  Here, the lender is trying to do the same thing he did with the Survey and Appraisal:  minimize risk.  If the property is located within a flood zone, the lender may require a special flood insurance policy or may refuse to lend all together.

Termite reports are almost always required by the lender, once again, to ensure that there is no significant damage to the property.  When termites or significant damage are discovered, it usually becomes a seller’s responsibility to correct the issue to the satisfaction of the lender.

Lenders usually require a Title Insurance policy as well.  This insures the lender’s investment should a claim against the title be made.  Again, these situations are so rare today, but when a party comes forth with proof that they actually own the property you just purchased, Title Insurance can be the only safeguard.

Home Inspections are not required, but we always recommend them.  Even if you are knowledgeable about construction, home systems and the like, you are always wise to pay an expert to go through the home you are about to purchase and report on any defects.  It is important to understand that there has never been a perfectly clean home inspection.  Every home has a few minor issues.  It can be as simple as missing or broken switch plates, a door that doesn’t close properly or something larger like a leaky roof.  I like to go through inspection reports with my clients line-by-line, evaluating each item to determine whether  it is something easily corrected or a larger problem that must be addressed before the transaction continues.

When purchasing a condo or a home in a neighborhood with a homeowner’s association, you have the right to examine the documents of the association prior to completing purchase.  This is very important.  You want to know that the association is financially viable and able to cope with unforeseen large expenses that may arise.  The worst example might be the condo development that suddenly needs a new roof two months after your purchase.  You also want to know what kinds of issues the association has been working with in recent months.  I find that reading the association’s meeting minutes is very helpful here as controversies and areas of contention are often reported.  Finally, every association has rules and by-laws.  When you purchase in this kind of neighborhood, you are agreeing to abide by those rules.  It is important that you know what they are before you buy.

Home Warranties are an option we often recommend for purchasers of resale properties.  These policies cover major systems in the house in the event they fail during the term of coverage – usually a year or two.  Often there is a small deductible, but if the air conditioner  or water heater fail during that time, they can be replaced with little out of pocket for the new owner.  I like Warranties because things do break.  When they break a few months after purchase it can make an otherwise joyful time turn sour.  Home Warranties ensure not just systems, but also your peace of mind and happiness with your new home purchase.

When you are buying it is important to protect yourself against possible problems with the property.  Fortunately, most standard purchase agreements and lender policies offer ample protection.  At Help-U-Sell Honolulu Properties, we work with our buyer clients to help them determine what additional protections are appropriate for each home purchase.

The Cost of Waiting

One of the critical factors coming into play in the Oahu real estate market is affordability.  Even though prices are still surprisingly reasonable in many places, Hawaii has never been a inexpensive place to buy a home.  With prices approaching record levels, it is becoming increasingly expensive and less affordable.  

In December of 2012, the median price single family home on Oahu was $595,000 (though the median for condos was closer to $315,000).  Interest rates on a 30 year fixed rate loan were about 3.5%.

That means, if you bought the median priced home that month with, say 20% down ($119,000), your principal and interest payment would have been $ 2,412.

In December 2013, the median price of a single family home on Oahu was $629,500 – about 6% more than in  December 2012.  If you bought that house last December, you’d have been out of pocket $6,900 more for the 20% downpayment and your mortgage payment would be $2,540 – $128 a month more for the same house.

So the cost of waiting just one year would be $6,900 (additional downpayment because of appreciation in values) + $128 a month for 30 years – $46,080!  Of course, you would probably not stay in that house for 30 years, but still, the cost of a 12 month delay, in this market, could push the limits of affordability.

Here’s the good news:  Though rates rose a full percentage point from 2012 – 2013 (December 2013’s rate was about 4.5%), rates have taken a bit of a hiatus for the time being.  Right now, a 30 year fixed can be had for about 4.3% – less than even two months ago.  Nobody expects rates to stay this low for much longer and most predict a slow creep upward over the next year.

So, the question of the moment is this:

What are you waiting for?

If you’ve dreamed of owning a piece of this wonderful place we call home, NOW is the best time – and may be the last time – to do it.  If you’ve been thinking of selling and trading up, NOW is when you will get the most for your money.  Next year, you will be looking at even more cash out of pocket to buy the same house and a payment that will almost certainly be higher.  Give us a call at Help-U-Sell Honolulu Properties and let’s get started!

Why Percentage Based Real Estate Commissions Are Nuts

We’ve been at it here in Hawaii for more than 10 years.  At what? you ask.  At providing real estate services that are priced fairly and reasonably; at pioneering a newer, better way of doing the real estate business; at not just selling real estate, but also changing the way real estate is sold.  We’ve gone from nothing to being one of the most substantial residential real estate companies on Oahu, which is a testament to the effectiveness of the program we offer.

We’re different.

Oh, we get the job done just like the best known companies on the island.  We offer full service that goes beyond our clients’ expectations.  We delight the people who work with us so much that most of our business comes from their referrals.  Best of all, we save our clients thousands of dollars over what they’d likely pay an old fashioned real estate broker.

We are not married to the old way of doing business.  Nor are we married to the old way of charging for our services.  Help-U-Sell Honolulu Properties is the next big thing in real estate, a new way to buy and sell and the best way to save in the process.

Sometimes the best way to explain the difference is to put a pencil to it and run the numbers.  Here is short video that does just that:

If you are ready to be delighted not just by the real estate service you receive but also by the fee you pay for it, call us.  Let us show you a newer, better way to sell and buy real estate!

The TRUTH About Real Estate Marketing

You listed with a real estate broker to sell your house, right?

Actually, that’s probably not the correct syntax. What you really did was to list with a broker to get your house sold.

It’s a subtle difference in wording, but one that points out the disconnect between thought and reality for many real estate consumers. The first phrase imbues the broker with near magical powers: he is going to take the house, wave his magical real estate wand, and cause someone to buy it. That’s really not what happens, although many brokers would like you to believe the myth that it does. Phrase two is closer to the mark: you’re going to use a broker to gain access to the natural matching of buyers and sellers that’s already going on. The broker is not magical. He is just a skilled gatekeeper.

The truth about real estate marketing is this:

A certain number of buyers are going to buy in the neighborhood today and a certain number of sellers are going to sell. The broker’s job is to get in front of, and prove valuable to as many of those people as possible.

That statement encapsulates the marketing function of a real estate broker as accurately as it can be. People can’t be made to want to buy real estate. They either do, or they don’t. A little education can help them make an informed decision, but it is a decision beyond anyone else’s control. Their decision to buy one house over any other is not a decision at all, it’s a choice, an illogical, personal, quirky choice. No amount of full page advertising is going to cause them to choose one house over another.

The broker’s job is to a orchestrate a marketing program that puts his or her office in front of as many of these potential buyers as possible. Once that is achieved, ‘selling’ real estate becomes a matching process: buyers’ wants and needs to inventory.

So how does a smart broker market to get in front of as many potential buyers as possible?

Job one is to be SEEN, to be VISIBLE. The consumer needs to see the sign, the logo, the name everywhere to have a comfort level that the broker may be able to help. This is accomplished with For Sale signs, local advertising and, increasingly, Internet marketing. But, you have to have something to market first . . . SO: the best thing your real estate broker can do to sell your house is to go out and get another listing and another listing and another listing. Each new listing is a marketing opportunity, an opportunity to generate buyer inquiries into the ofice. Of course, what’s done with those calls is another issue, one we’ll talk about in a moment.

Job two is to GENERATE LEADS: to put marketing pieces into the hands of consumers that will motivate them to make contact with the office. When a broker decides to create a marketing piece, he or she must do it dispassionately . The decision to advertise one house or another should be made based on which one will cause the largest number of potential buyers to contact the office, not on which seller is ‘owed’ advertising this week. This is an important point. Truth is: almost always, the advertised property that motivates the potential buyer to contact the office is NOT the property they eventually buy. There are dozens of kick-out factors they may encounter as they do their investigation. But that doesn’t matter. What’s important is that they contacted the office.

So, when a sharp broker decides to advertise a property, it’s not to get that particular property sold, it’s to generate buyer contact. It is this general lead generating activity that will cause your house to sell and it may not even involve advertising your house at all.

Ok: we’ve got Job One and Job Two. Here’s the third thing the real estate broker needs to do: CAPTURE LEADS. When marketing causes a potential buyer to contact the office, what will then cause them to agree – however subtly – to letting the office match them with a perfect property? It is a process that often occurs on the telephone, and at Help-U-Sell Honolulu Properties, we work on it constantly.

It’s important to understand what courage it takes for a potential buyer to pick up the phone or fill out an online inquiry form. They know they are likely going to hear from a salesperson . . . and that’s not what they want at all. What they want is the information. Period. So there is a very natural defensiveness on the other end of the line when the agent answers the phone.

How the agent handles the call, how he or she relaxes the caller, provides valuable information, builds a comfortable rapport with the caller is EVERYTHING. All of the time money and effort the broker has used to generate the lead can be lost right here if the agent is not prepared to earn the caller’s trust and then to begin the matching process. Now, think back to the last time you called a real estate office for information on a property. Uh-huh. I know. It was a painful experience. If the agent made any attempt to earn your business at all, it was probably pretty lame. And that’s IF they tried to earn your business at all (most won’t).

It’s such a shame, because that moment, when a buyer inquiry is handled in the office, is the ARENA. That’s where the process of ‘selling real estate’ begins. It is so important, I think it makes perfect sense for a home seller to call the office of the agent they are considering and see how they are handled. If the person on the other end of the line can’t comfortably communicate competence, if they can’t skillfully earn the right to help you find your next home, how are they going to capture the real caller who might be perfect for your house?

Bottom line: advertising wont sell your house. An agent or broker won’t sell your house. What will sell your house is an office with an active lead generation and capture process. And where will you find such an office? Honestly? Right here: Help-U-Sell Honolulu Properties. Here, the broker is in charge of marketing, lead generation and capture. We are completely focused on the process and we do it better than anyone on Oahu. AND: with low set fee pricing, we save sellers a lot of money, too.

What Would You Do To Sell Or Buy Your Dream Home?

I read a story the other day about a new ‘trend’ in real estate buyer behavior.  It think the word ‘trend’ is probably a little over-stated . . . seems only a few buyers in rare instances are doing this, hardly a trend.

In a few instances recently, home buyers have made their offers contingent on a sleepover.

Yep, they want to spend the night before they commit to the new home.  Sounds odd at first, doesn’t it?  But when you think about it, maybe it’s not such a bad idea.  Most people look at homes during daylight hours, occasionally in the early evening.  The entire ambiance of a neighborhood can change after dark and without some mechanism for inspecting this crucial time . . . well, you might be in for a surprise.

As a Broker, I am sometimes asked about the demographics and makeup of a neighborhood.  Fair Housing guidelines carefully define what I can and cannot say about a neighborhood and sometimes I get questions I just cannot answer.  Thanks to the Internet, there is abundant data online about crime rates, schools, neighborhood demographics and so on.  But data alone rarely gives the comfort level to some that this is the right neighborhood.

That’s why I often ask nervous home buyers to visit their prospective neighborhoods during odd times.  I suggest they go to the closest super market between 4 and 7 pm (peak shopping hours).  I tell them to drive by the closest schools about time classes end for the day to get a feel for kids and parents and that whole dynamic.  I ask them to drive from the neighborhood to their workplace during morning commute time to get a feel for traffic.  All of these activities are aimed at helping people be comfortable with their choice of neighborhood.

The lengths to which sellers will go to get a quick or a great offer is shifting as well.  Today we have professional ‘Stagers,’ who – for a fee – will do everything from rearranging furniture to re-furnishing a re-sale home so that it shows like a model home.  More than a few sellers have told me professional staging was the most important thing they did towards getting a great offer.  Some sellers have re-worked landscaping or substantially remodeled their homes to maximize their return.  In some locations, real estate companies that renovate very outdated homes prior to marketing them have sprung up.

But as a home seller, how far would you go to secure an offer?  Would you permit or encourage a sleep-over?  Would you offer your back yard for a cook-out or pool party?  Of course, in these cases, we at Help-U-Sell Honolulu Properties would be there to advise you – and clearly, in some cases it would not be a good idea – and to secure the proper agreements and deposits.

Thankfully in today’s Oahu market, sellers are in pretty good shape.  Housing is in demand and properly priced homes sell relatively quickly with few seller concessions or inconveniences.  Usually all a seller has to do to have a marketable product is to price it properly and make it easy to be seen via lockbox and continuous availability.  When you talk about selling your home with us, we will advise you about what might help get it sold quickly and for top dollar … and in most cases it will be things like a little paint here and there and a thinning-out of closets!

How to Price Your Home To Sell

When putting your home on the market, the second most important decision you will make is price.  The first?  Your Broker.  But that’s a different post.

The price you set must deliver maximum dollars to your bottom line (which also involves terms) without being so high as to scare buyers away.  At the same time, the price must be able to support a professional appraisal.  We call the right price ‘Fair Market Value.,’ and rather than a dollar and cents price, we often express it as a range of value.  Truth is, ‘Fair Market Value’ is what a ready, willing and able buyer is apt to spend on your house today, and that figure can vary a few thousand dollars in either direction depending on terms and whim.

The best clue we have as to what ‘Fair Market Value’ is for any house at any specific time are the recent sales of similar properties.  If five houses in the same neighborhood with the same floorplan and square footage have sold in the previous three months, their sale prices ought to give us a pretty clear indication of what a willing buyer would likely spend on your house.  I wish doing a Market Analysis and evaluating comparable properties was always that easy!

Unfortunately, too often there are too few comparables in the previous three months.  Sometimes we have to look at the previous six months and sometimes we have to go back a year to get sufficient data.  Often the specific neighborhood has too few sales occurring of similar properties and we have to expand the search to neighboring areas.  And sometimes, the property isn’t in a neighborhood at all or is so unique that finding similar homes is very difficult.

At Help-U-Sell Honolulu Properties, we are in the market every day and have been for years.  Often it is our knowledge of what’s going on and what’s gone on in the past that drives our recommendation on pricing.  In addition to comparable sales, we consider price trends in the marketplace and factor those in.  If you are in an area where prices are rising 1% a month, where the most recent sale was 3 months ago and where it’s apt to be 2 months before a suitable buyer can be found for your property . . . well, there’s a 5% price differential there that must be taken into account!

It is important to go into the market with an initial price that is close to Fair Market Value because the first two weeks any home is on the market present the greatest opportunity for maximum exposure.  At any moment there are dozens of potential buyers looking at homes on Oahu.  Some may be looking for a home just like yours, and may have been looking for weeks or even months.  It is this backlog of buyers we want to attract the day your home goes on the market.  In a week or two, that pool will have seen your house, will have decided it was right for them or not, and you will be left with only new buyers trickling into the market as prospects.

Overpricing with the idea that ‘I can always come down,’ is a foolish strategy for this very reason.  That backlog pool of buyers will see your house and the high price and continue looking.  A month of two down the road, when your frustration is at a peak, you may reduce your price back to where you should have started . . .but price reductions often create questions about a house.  What’s wrong with it?  Is the seller becoming desperate?  

There are online tools today that claim to help you determine Fair Market Value for your property.   Most notable is Zillow’s Zestimate of Value.  I can’t tell you how often we have met with home sellers who have an inflated idea about their home’s value because of a Zestimate or worse, believe their home is worth less than our recommendation!  Understand that with automated online tools, estimates of value are being made by a machine with no local market knowledge, no hands on inspection of property, no understanding of the nuances that can make one property worth more than another.  To really understand the value of  your home, to know what the right price today, you need the help of a true professional, like those of us who are proud to call Help-U-Sell Honolulu Properties home.

If you are thinking of selling or are just curious what your home is worth, please call us.  We’ll be happy to do the research and analysis and share a professional opinion with you.  It’s free.

 

Buying A Home On Oahu: 10 Things To Consider.

Purchasing a home can be a daunting experience, but it doesn’t have to be. To help we offer 10 things to consider when buying a home.

1.  The seller’s disclosure.  Before selling, a homeowner completes a detailed checklist of the properties various systems and components, noting any known defects or problems.  Even if you are in love with the house, it is important to be aware of any flaws.

2.  Zoning guidelines and restrictions.  This is especially important if you are planning structural changes or any kind of mixed use.

3.  Home inspections.  Ask us which ones are available and consider getting all that may apply to the property.  Of course the standard home inspection that reviews equipment and systems is essential as is the termite inspection, but you might also consider things like a pool or roof inspection.

4.  Reason for selling.  Why is this home for sale?  Where is the seller going?  You might think this is irrelevant when buying a home but if you understand what the seller is trying to achieve it can help you structure an acceptable offer.

5.  Radon gas.  Radon is a naturally occurring radio-active gas that has been linked to some forms of cancer.  It can accumulate in dwellings depending on how they are built and ventilated.  Radon gas is rare in Oahu but it does occasionally show up.  We’ll help you decide if a radon gas inspection is a good idea.

6.  Water damage.  An unfortunate interaction with water, whether from a leak or a flood, is a part of almost every home’s history.  Properly repaired, this is not a problem, but if care is not taken in the clean-up, mold can form.  Your professional home inspector should uncover any problems here, but it also doesn’t hurt to ask the seller if there have been water problems. You may want to have a complete environmental inspection if there seem to be any concerns.

7.  Crime rate.  What is the level of crime in the neighborhood and what kinds of crimes are most frequent?  One way to check this out in Oahu is by visiting Neighorhoodscout.com.

8.  Noise level.  If you tour a home at 3 pm, you will get a feel for what the noise level is at that moment.  But, what about 10 am? or 6 pm?  Sometimes it makes sense to drive back at odd times to get a feel for noise.

9.  Dogs and children.  Either may be a positive or negative depending on your own wants and needs.  The best way to know if a neighborhood is a good fit for you is to simply spend a little time there.  Go to the local supermarket and see who is shopping, visit the closest park and relax for a bit, drop by the nearest school when classes adjourn for the day.

10.  Schools.  How good are the public and private schools in the area?  Even if you don’t have school aged children, this is important as it can impact resale.   You can find school information in a variety of places including Education.com.  Also, Honolulu Magazine grades public schools on Oahu every year in their May issue. The latest report is HERE.

Of course, there are easily another “10 Things” that could be added to this list, but we are up on all of it.  Give us a call. We can help.

Hawaii Housing Affordability

Remember all of those years we worried so much about our housing investments?  From roughly 2009 – 2012 we saw short sales and foreclosures rise, home prices stall or fall, buyers disappear from the market and, in some places, desperation.

That all seems to be behind us now, as 2013 has proven to be a big recovery year for Hawaii real estate.  Inventories have shrunk to such low levels that bidding wars are common in high-demand areas.  Foreclosures are becoming increasingly rare and the short sale market is shrinking.

The best news is that prices are rising, in some areas by double digits.  Of course this combination of good news makes some people a little nervous.  Could we be on the verge of another housing ‘bubble?’ I think not, for a very good reason:  affordability.

Affordability is a measure of how much income it takes to qualify for the median priced home, expressed as a percentage of the general population who has that income or more.  As you might imagine, affordability was at an all time high at the beginning of 2012, just before the market began to turn.  But since then, as prices and interest rates have risen, the affordability metric has declined.

While affordability numbers for Hawaii are illusive, we can probably glean a trend from another traditionally expensive real estate market:  California.  According to the California Association of REALTORS, in the third quarter of 2012, 59%  of Californians could afford to purchase a median priced home in the State.  By the first quarter of 2013 it was at 36%, and now, in the third quarter of 2013, the number is 32%.  that’s a 27% decline in affordability in one year!

We have not seen affordability at these levels since the end of 2008,  but this is a fluid metric, impacted by a number of factors:  mortgage rates, home prices, and increasingly, mortgage underwriting criteria.  This year lenders have been strict when it comes to underwriting.  Nobody wants a repeat of the sub-prime lending melt-down.  However, we’ve recently seen some relaxing of underwriting standards to the point that today, a person with a lower FICO score, less money down and more debt can qualify for a mortgage that he could not have gotten last year.

Affordability is just one of the factors impacting our recovery, and today it is working to keep our recovery from spiraling out of control.  Affordability, prices, interest rates and inventory are all working to move us toward a market that is somewhat ‘normal.’

Don’t be dismayed by the low affordability numbers.  At Help-U-Sell Honolulu Properties, we are expert at helping people find lending products that enable them to purchase their dream homes.  We know where the mortgages are that fit your financial situation, and we’d be pleased to consult with you on this important issue.

What’s Most Important When Buying A Home (Selling One Too)

It pains me to admit it . . . it’s such a tired old cliche . . . but it’s true:  Location, Location , Location.  

The way we interpret that has been a little askew – the notion that there are right locations and wrong locations, good locations and bad locations – but your location, and more important, your understanding of the strengths of your location, are key.

No, there are no right and wrong locations.  Almost every location is ideal for someone.

Young families often want a location near a particular school.

Working people often target a neighborhood based on commute.

Urban hipsters want to enjoy the nightlife of the ‘hood on foot.

Families on tight budgets often want affordability and seek areas where that’s possible.

When you begin to look for your dream home, start with lifestyle:  what is yours?  How do you like to spend your everydays?  What are the activities that drive your life?  What’s important in keeping you and your family moving forward?  Get a picture of the kind of neighborhood that will support that . . . and then look for it.

Fill in a few blanks:

I want to be able to ________________.

I really like to ___________________.

It’s important that we ________________.

We have to be close to ________________.

And so on.

We are usually very clear about how far:  how far away from X and Y we are willing to live.  So take your local map, plot X and Y and then draw that meandering circle that sets the limit of that distance.  That line will become the boundary of your ballpark, the large area inside which you will look for your lifestyle.

Don’t worry about what anybody else thinks.  It’s your lifestyle, not theirs.  The exception is your REALTOR. who should be on board with your process and can point out pluses and minuses you may have missed.

Not until you have identified the locations where you can be happy living can you get down to how many bedrooms and baths, house vs. condo, ranch  or split-level.  Those things don’t matter until you have found your location.

When considering a location, do a little field reconnaissance before adding it to the acceptable list.  Go to the local supermarket during a busy time – often 5-ish in the afternoon – and shop.  These are the people who will be your neighbors:  what do you think?  Get up early and go hang out in a coffee shop or get a guest pass to the gym.  Drive the neighborhood – or drive your commute to and from the neighborhood – during rush hour.

If you are selling, do the same kind of exercise.  Discover (or re-discover) what kind of people live in your neighborhood.  What is the lifestyle?  The average age?  What do your neighbors like to do?  You probably think you already know this, but if you’ve been in your home for awhile, you may be surprised at how things have changed when you weren’t paying attention!

Do this as a seller to get a picture of your target.  What kind(s) of people are most likely wanting to live in your neighborhood?  Once you have that in mind, how would you go about reaching them?  It’s one of the topics of conversation in every listing consultation we do at Help-U-Sell Honolulu Properties.  Before we begin marketing, we try to identify the most likely target(s) of our marketing efforts for each property.  This helps us fine tune the marketing to produce optimal results.

Location – yours and the one you want to have – is real estate bedrock.  It is location that will enable you to love your home or not like it so much.  When you begin to look, or prepare to sell, spend a little time getting very clear on location.  Then call us and get moving!

The Truth About Trulia, Zillow and Searching for a Home Online

Many of the homebuyers I work with have looked at homes for sale online on sites like Zillow and Trulia.  They often have questions about the information they are getting online, so I thought I’d take a moment to explain who and what these large real estate sites are.

Zillow and Trulia are National Property Portals.  They collect and aggregate information about housing and houses for sale from all over the U.S. and offer it up to consumers in a searchable database. They make money by selling advertising.  The Portals sell premium placement of agent and broker information throughout their websites, in theory giving those agents an edge in securing buyer and seller leads.

The information on houses for sale comes from a variety of data feeds.  It is possible for an agent or broker to physically input a listing into the National Portals, but in reality this rarely happens.  Instead, the agent or broker inputs the listing into the local MLS, that then ‘feeds’ the listing information to the Portal.  In their quest to have as much housing information as possible, the Portals also ‘pull’ feeds – sometimes containing the same, but perhaps not exactly the same, information – from other sources.  For example, if the real estate office is a member of one of the large franchises, their franchisor may feed listings to the portals as well.  Or a large, multi-office firm may have its own feed.

As many home buyers quickly realize there are frequent inaccuracies in the data on the large portals. It is a conundrum for the portals for which there is no easy solution.  

Essentially they are trying to do what is a local job with a national platform.  They receive tons of data from multiple sources and, because they are removed from the local market, their methods of discerning what is accurate, and what is not, are somewhat flawed.  So you have duplicate listings with different prices, homes for sale that were actually sold weeks, even months ago and price estimates that consider only the average value in an area – which can be skewed by one very big sale or one that is very small. It can be very frustrating for the consumer.

Of course, there is a better way to search for homes for sale on Oahu or anywhere in Hawaii.   At Help-U-Sell Honolulu Properties, we approach the homebuying process as a partnership.  We want our buyer clients to be as involved in the search as they’d like to be, and we want them to have access to the most up-to-date and accurate information as possible.  

That’s why our website pulls data from the LOCAL MLS every day and makes it available to consumers in an easily searchable format.  When you search for homes for sale at HUSHawaii.com, you are looking at he same data that local real estate agents use.  It is accurate, current and easy to understand.

If you are just starting your search or deeply into it – or if you’re just curious about local homes for sale – we’d be pleased to show you how our local home search site can make the process easier.  You can search to your heart’s content, and when you need more information on a property, on financing, or on qualifying, we will be right there with you.

Improve Your Credit Score, Easily!

The single most important factor in determining how much you can borrow and at what rate is your FICO score. FICO stands for The Financing Corporation, a joint, private/government project for helping financial institutions make wise lending decisions. Their set of credit score addition and subtraction rules is complex to the point that whole businesses exist to help consumers manage this aspect of their financial lives. 

Your FICO score is a numeric evaluation of your credit worthiness and is based entirely on what is reported to the three credit bureaus – which, as we all know can be in error. Scores above 760 generally result in the most favorable loan terms and rates. If your score falls below 620 finding an acceptable loan may be difficult.

Improving your credit score can be a major project, but there are a few easy things you can do today and in the near future that will have a major impact.

  1. Pay your bills on time. Pure and simple, that’s how to establish yourself as a good credit risk. If this has been a problem in the past, start today to show a new pattern. Borrowers with a foreclosure – possibly the biggest negative in a mortgage history – are sometimes able to get a new loan in as little as 2 years IF they can show a pattern of credit responsibility over that time. So its wise to start today to give yourself a credit make over.
  2. Don’t close credit card accounts. To have good credit, you have to demonstrate that you use credit wisely. A credit report with no credit is like a beautifully set table with no food.
  3. Have ongoing credit activity. Use your cards, wisely and lightly. That does not mean to rack up balances. It means to have a small balance here and there, to occasionally pay one card off and to never miss a payment.
  4. Get an installment loan. You probably already have or have had one. Credit cards are ‘revolving’credit. Installment loans are things like personal loans, auto loans, mortgages and student loans. Showing responsible credit behavior with an installment loan usually carries more weight in the FICO process than similar behavior with revolving credit.
  5. Manage your available credit. Your credit cards have limits. Hopefully your balances are well blow your limits. If not, get busy paying them down, because the gap between your balance and your limit is very important to your FICO score. You want your balances to be below 30% of your limits. You may accomplish this by paying down credit cards, but may also ask your credit card companies for an increase in the limit.
  6. Give your credit report a once over. There are dozens of places where you can get a copy of your credit report, for a fee or free. Give it a once-over.
          • Look for derogatory entries. Are there any that are false? Dispute them with the reporting agency.
          • Are there any that are insignificant from a monetary standpoint? (note: derogatories are never insignificant from a FICO standpoint). Maybe you got into a squabble with the phone company over a charge and withheld payment. Now that $127 charge that went to collections is dragging your score down. Challenge it. Sometimes, if the amount is not worth the effort, the company will not contest it.
          • Are there derogatories older than 7 years? These are supposed to drop off your report but sometimes they remain. Request they be removed.
          • If you have a late payment with one lender here, and another with a different lender there, but otherwise have a great payment record with both, ask those lenders for a ‘goodwill adjustment.‘ Often the derogatories will be dropped.

Map out a plan using these tips for, say, 8 months. Check your score before and after and see what kind of difference you can make. Of course, we at Help-U-Sell Honolulu Properties are here to help and would be happy to work with you as you improve this important personal metric.