Many people will relocate to a new home this coming year.  In the initial stages you need to make high level plans and decisions concerning the sale of your current home and the physical move.  If you organize yourself, this will minimize the impact on the family.  Following are some suggestions:

·     First, you need prepare your home for the market, and contact movers to get quotes for the move.  At this point in time, you do not know exactly how fast your home will sell.  This is the reason for contacting the mover now, especially if you are using a professional mover.  When interviewing movers, asked plenty of questions.  Be sure to ask about different options that are available concerning packing and unpacking services. In addition, inquire about insurance on your possessions, and conditions for getting insurance.  Important documents and valuable possession you should consider not shipping with the mover.  These should always remain in your possession.  Where possible, such as documents, create backups.

·       After you have put your property on the market and decided on your mover, and before having an executed contract in your possession, update your mover at least once every 2-weeks by making a phone call or sending an E-mail.  Immediately, after have an executed contract for your property, contact the mover to schedule packing and move.  At this point in time, maintain weekly contact with your mover.

·      Next, begin cleaning out closets, drawer, and storage areas.  This is a great time to schedule a garage sale.  Determine what items you going to sell and give away.  If you are moving yourself, get boxes and begin packing.  Be sure to organize your items, and clearly mark each moving box with the contents inside the box, and what room does the box go to in the new house.  Finally, secure a rental truck for the move.

·     Within 2 weeks of the move, be sure to determine with your mover what items are not allowed on the mover’s truck.  In addition, make special arrangements for your children and pets.  Finally, make arrangement to clean your home.  The new homeowner expects to be moving into a clean house. 

·     Within the last week, make sure you understand when and how your mover is to be paid and then make the necessary arrangements.  Make sure you keep back necessary items you will need between moving day and the date your possessions are delivered to your new home.  Make arrangements to have utilities turned off at your current home and turned on at your new home.

·     On moving day, be sure you go through the house to insure nothing has been missed, and clean the house before leaving.

After you have been pre-approved for a mortgage loan, and have sufficient cash to make a down payment on a house, then you are ready to find a house that meets your family needs and desires.  At this point in time, you need to be realistic about your needs and have patience during your house search.  You need to determine the neighborhoods that are suitable for your family needs, and know the maximum price you can afford to pay.  The maximum price you can afford to pay may be less than the maximum amount approved by your lender.  When determining the maximum amount you can afford to pay, be sure to factor in college expenses, vacations, entertainment and maintenance expenses, etc.  Then determine your needs and wants.  Your needs are the amenities you need for your family and wants are nice to have amenities.  Develop a checklist for both interior and exterior features and rate them on a scale of 1 to 10.  Use this checklist for each house you tour.  While touring houses the following list are a few other suggestions:

·      Take photos of each house you tour.  This helps you remember the details about each house.

·       Do not make any hasty decisions.  Be sure to weigh the pros and cons of each house.  If you miss out on 1 house there will always be another house that you fall in love with.

·      Compare your needs versus your wants and budget using your checklist.

·        Bring your spouse, friend and/or parent for a second opinion.  They may notice something that you have overlooked.

·        Asked your realtor to get utility history for the house. 

·        Keep reviewing the multiple listing for additional new houses.

·        Stay in close contact with your real estate agent, and have him keep you informed of available properties.

·       Look at the potential of the house versus what you see.  It is more important the house has the rooms, layout, and space you need versus the color of the walls and minor repairs.  

Remember, when making an offer make sure the contract is contingent on a professional inspection.  Finally, you may be involved in a multi-offer environment.  This will cause greater emotions, but don’t let emotions control your final decision.  Many times, you are better off by sticking with original plans. 

Many times people have difficultly determining whether they are ready to buy.  This is true for renters and people who need to move-up or down-size.  There are signs that may help you determine whether you are a ready buyer:

·     If you are person who is familiar with the current market conditions, paying close attention to how much houses are listed for in desired neighborhoods and a have realistic understanding how much your new home will cost you.

·     Have money to cover 3 to 20% down payment plus closing cost.  Closing cost will run between 2 and 7% of the value of the property.

·     Have a good understand on how much you can afford.  Your income/debt ratio should probably be no more than 28/36% of gross income.

·     Understand and have the capability to pay for additional expenses that come with ownership of a home, such as, homeowners insurance, utility bills, and maintenance cost, etc.

·      Have a good credit score.  Credit will be a major factor in determining your interest rate.  The higher your credit score the better.

·      Haven’t lately made major purchases, such as, vehicle.  This can lower the amount of loan you can get and/or made it more difficult to purchase your new home.    

When you purchase a home you will be faced with the decision on how many discount point should I purchase when buying my new home.  Discount points are associated with the interest rate you will be charged for your loan amount.  Points are referred to as prepaid interest.  If the points are paid by the buyer, the buyer is entitled to use the amount as a tax deduction from his taxable income in the year paid.  One point is equal to 1% of your loan amount.  For example, if the loan amount is $300,000 you will pay an additional $3,000 at closing.  Also remember, there is no direct relationship between interest rates and points.  One point can reduce your interest rate approximately ¼ percent. Now the question becomes how many points should I buy?  First, calculate your monthly mortgage payment using no points.  Second, make several calculations using different number of points to determine your monthly mortgage payment.  Then compare step 1 calculation to step 2 monthly mortgage savings results.  During this process you will determine the number of months it will take you to pay off each point calculation.  Also, estimate how long you plan on living in the home.  After performing the above calculations you will have a better idea how many points you should buy to reduce your interest.  There are couple of other things to keep in mind: first, how much available liquid cash do you have to buy down the interest rate, and second, remember everybody situation is different, and therefore what is the good plan for someone else is not necessarily best for you.           

During your house hunting experience it is possible you will find 2 houses that you like equally well.  You and your spouse may be split on which house is best for your family.  If you are in this situation and needing to make a decision on which house to make an offer, do not take this obligation lightly.  In your thinking process you need to be rational and not guided by emotion.  Many times in this situation you do not have the luxury of available extra time.  The houses maybe located in a hot market area and/or priced to sell quickly.  When the above occurs it is a good idea to put the pros and cons on a piece of paper and truly define your family needs and budget.  While performing this task, I would recommend include the following comparisons:

·      Compare the neighborhoods for things that are important to your family, such as, kids in the neighborhood, parks, shopping, restaurants, church, how well the neighborhood is maintained and distance to work.  Finally, talk to residences of the neighborhood.

·      Evaluate the schools, this is important if you have children and for resale value when you are ready to sell in the future.  If you have children you should visit the schools and review state standardized test results online.

·      Review crime and sex offender statistics by visiting with the local police.  Residence sex offender statistics should be available online by neighborhood.

·      Stay away from purchasing the most expensive house in the neighborhood.  When you get ready to sell you may find out that your home value did not appreciated as fast as originally though due to lower price homes within the neighborhood.   

·      Request your realtor to provide you an appreciation report for the past five years defining the rate of appreciation.  This may identify the better home for investment and make it more profitable when selling.

·      Ask your realtor how long the house has been on the market.  The seller may be more willing to negotiate on the selling price if the home is been on the market for a long time.  At the same time, try to find out why the seller is selling, for instance, divorce, or the seller needs to move quickly, etc.

·       Have a list of the amenities and attributes that you would like to have in your new home.  Compare each house to determine how it measures up to your needs and desires.

·      Likewise make list of drawbacks of each property to determine the negative impact this will have on your family.     

After performing the above tasks, revisit each house and weigh the pros and cons of each property.  This may lead you to a clear cut decision on which property is best for your family.  Many times buyers make a compromise on amenities, getting an amenity they did not plan on, and giving up some other amenity.     

After you have been pre-approved to purchase a home, then it is time for serious house hunting.  When you find the house you like to call home, then it is time to make an offer.  At this point in time, you need to make a good offer.  How do I make a good offer?  First, you need to understand the market conditions in the area by knowing whether you are in a buyer’s or seller’s market.  Second, you need to have financing terms that you are comfortable with.  Third, when making an offer the fewer contingencies you have in the offer, the better the seller will like your offer.  Fourth, make a realistic offer from a price viewpoint.  The offer should be based on similar homes sold in the immediate neighborhood within the past six months.  Be sure to factor in conditions of the property and how fast homes are selling within the neighborhood.  If houses are selling quickly and getting multiple offers it will be necessary to bid competitively.  Otherwise, if the market is slower, this will give the buyer more wiggle room for negotiation.  Fifth, include a pre-approved letter with your offer to the seller.  This will enhance your chances as a buyer.  Finally within the offer, include a clause that allows for home inspection, and permits further negotiations for corrective work after receiving the inspection report.   

When embarking on the process of buying a home, you will need to make a decision on whether to purchase a new home or an existing home.  There is no single right answer to this question.  I do recommend you spent some time looking at both new and existing homes prior to making your decision.  Sometimes the right decision is based on timing, because there are better deals available with either a new or existing home.  You may be drawn to a new home with its shiny new, energy-efficient appliances, more space, larger master bedrooms and closets, etc.  On the other side, an existing home may have greater charm and larger trees within a quiet neighborhood.  Before making your decision, following are some consideration you may want to think about:

Neighborhood – Older neighborhoods have mature landscaping and developed trees.  These neighborhoods are normally closer to the central part of the city.   New neighborhoods tend to have more neighborhood amenities, such as, parks, community swimming pools, bike and walking paths, etc.            

Maintenance and repair – Before considering an existing house, be sure to verify the following items are in good working condition: HVAC, roof, windows, no moisture damage, and foundation.  Always have a professional inspector check the house.  New homes always have a 1 to 10 year warranty depending on the item in the house.   

Home improvement – With an older homes there are normally a greater need for home improvement projects.  While with a new house, you probably would only be doing home projects that would enhance the value of the property to meet your desires and needs.

Existing features – Buying an existing home, some features may already exist in the home, such as, window treatment and the upgraded landscape, etc.  If these features exist and meet your desires for the short term, this would be an immediate cash savings.  With a new house everything is new, but tend to lack window treatments and upgraded landscape, etc.

Remodel – Some buyers enjoy remodeling an older house in a particular location.  This gives them the opportunity to modernize and expand to their desires.  In this situation, the buyer needs to become knowledgeable of building codes and restrictions; otherwise, this could become a very expensive non-completed project.    

Price – Existing houses tend to be less expensive and have more amenities.  This is especially true when buying a resale home in the same subdivision where the builder is currently building new homes.  In other situations this may not be true.  Recommend visiting multiple builders and having a realtor can make a difference.

Appreciation – When buying an existing house there is a track record (long or short depending on age of house) on how much the home has appreciated over prior years.  Remember this does not guarantee future performance.  Always evaluate how population is shifting within the city and the condition of the neighborhood.

Taxes – Before purchasing a home, be sure to get the latest tax record for the current area and surrounding areas.  Depending on the state and location within a city, property taxes can vary considerably.

As I mention earlier there is no single right answer concerning purchasing a new or existing house.  The main thing you want to do is to evaluate all the facts prior to making an offer on your new home.              

After you have made a successful offer and prior to closing on your new home can be a stressful time trying to prepare for the physical move.  Following are some helpful tips for your move:

Build in moving time in your contract:  This normally is easy to accomplish if moving from leased property provided you plan in advance.  Your purchase contract needs to be written in such a manner that allows sufficient time for the move.  When moving from a non-leased property to another home can be more difficult to coordinate because there may be circumstances with other homeowners that are out of your control.  There are techniques that may be used such as lease back agreements which can make the move easier and less expensive.  Another thing many people like to do prior to moving into their new home is to make updates to the home.    

Moving company:  If you are planning on using a moving company, always contact a moving company early.  Recommend contacting the moving company 6 weeks in advance and much longer notice if you are moving long distance.  Valuable items such as jewelry should be packed separately and taken with you instead of putting into the moving truck.  Large valuable items such artwork and electronics should be clearly identified on the container and mover’s inventory report.

Eliminate stuff:  Property you no-longer want or use, this is a great time to discard this type of property. Items you rarely use and are in good condition have a yard sale.  Then give all unsold items to charity.  Finally, discard all items that are beyond repair.      

Notes:  Develop notes about your new home.  Take measurements of rooms, doorways, and areas for appliances, such as refrigerator (width/height/depth).  Determine the locations where cable, electric and phone outlets.  Develop a floor plan layout where all your furniture.  In addition, determine what contents are going into each closet. Finally, determine where tools and lawn equipment will be stored.  Having this documentation will make it much easier for the movers to get your stuff placed in the right area in your new home and easier to unpack.

Window Treatment:  If your new home does not have the proper window treatment such as, blinds and drapes, then you may want to take measurements of the windows.  Many times the new homeowner likes to update the window treatment prior to moving into the house.

Utilities:  At least 2 weeks prior to closing arrange for transfer of utilities (gas/electric/water/garbage) for both your current home and new home.  Also, you will need to arrange for the type internet and phone connections you will need.  In addition, notify the Post Office of forwarding address.  This can be done by completing a form with the Post Office.  Finally, if you are changing banks, and have automatic debt payment capability, notify creditors and make the necessary arrangements.

Packing:  If you are making a local or long distance move and doing the move yourself, first try to get boxes from your local grocery, electronics and office stores.  This will save you money versus getting boxes from a moving company.  Be sure to use plenty of paper when packing your items, and invest in a tape gun to secure your boxes.  If you are going to use a moving company for your move, remember most moving companies will not guarantee the load for damage goods unless they do the packing,     

Documents:  Create a record of makes, models and serial numbers of valuable items within the household.  In addition, take photos of all items prior to packing.   Maintain this information along with owner’s manuals, extra keys, birth certificates, car titles, wills, insurance policies in a separate folder.  Always keep this information in your possession and recommend putting most of this information in a safety deposit box immediately upon arriving at your new location.   This is especially important in case of a fire.

Cleaning:  Be sure to clean the home prior to leaving.  This is especially important if you were leasing the home.  If the home is not clean and not in the same condition when you move in, there is a strong possibility you will lose your security deposit.

In conclusion, if you follow the above outline of things to do prior and during the physical move to your new home this will help make life a little less stressful. 

Naturally, as a buyer you want to negotiate the lowest price for your new home.  This process is complex and every transaction has some unique qualities.  In this process, there normally are some give and take with both the buyer and seller with neither party getting everything they want.  As a buyer, how do I develop a strong bargaining position that will benefit me the most in the transaction?  Based on experience there are some keys that will help you win at the negotiating table:

Financing:  First, get pre-approved with a lender and demonstrate your flexibility to close quickly per the seller’s benefit.  A quick closing saves the seller out-of-pocket expense.  In addition, a pre-approved buyer creates less risk to the seller, and reduces the likelihood of missing out on selling the property to another qualified buyer.

Market:  Understand whether you are in a buyer’s market or a seller’s market.  The market is defined by supply and demand for housing.  If the supply is high, most likely it is a buyer’s market; otherwise, it is a seller’s market.   As a buyer it is better to be in buyer’s market where the number of available homes is greater.  This gives the buyer greater choice and flexibility when one home falls through.   

Details:  Buyer should pay attention to details of the property prior to making an offer.  Following are some of the details a buyer should be paying close attention:  condition of the property, cost and time of making repairs versus a home that is in move-in condition and seller concessions.  Seller concessions may include seller paying buyer closing cost, allowance for repairs and buy-down of buyer’s interest rate, etc.   

Leverage:  Buyer needs to immediately become aware of new homes appearing on the market.  Normally, top homes that are priced correctly sell the quickest.  Therefore, you need to be ready to identify and tour these homes immediately.  Many times this will give an advantage when making an offer by avoiding a multi-offer environment.  A multi-offer environment is good for the seller, but many times the buyer will pay a higher price for the property.  Another important factor in making an offer is to deliver a simple contract that has few or no contingencies.  Sometimes a lower offer with no contingencies in a multi-offer environment will be more appealing to the seller.     

Inspection:  Normally, after an offer for a home has been accepted by the seller, there is a period of time to inspect the property using a professional inspector and negotiate for needed repairs.  As buyer, be sure to take advantage of this opportunity and remember you are probably buying an old home.  This means, negotiate for repairs of major items not small items.  Trying to negotiate on small items tends to upset sellers and the buyer becomes the loser.

Using the above suggestions and being professional in handling the transaction tends to lead to a happier home buying experience.

Before putting your home on the market, think about how I can improve the results, and reduce my expense from the home inspection. Waiting until you have accepted an offer from a buyer may not give sufficient time to prepare your property for the inspection.  Usually, a home inspection is done immediately after the seller has accepted an offer from the buyer.  Following are tips that may make the home inspection go smoother and less expensive:

•  Insure all utilities are turn on.  Wherever you have gas pilot lights, insure they are turn on and functioning properly.

•   Recommend having all pets removed from the property.

•   Make sure all lights are working, and there is no burned out light bulbs.

•  Test your detectors for carbon-monoxide and smoke and replace batteries where needed.

•  Have your HVAC system checked and cleaned.  Be sure there are no shrubs or weeds surrounding the outside A/C unit.

•  Insure there are 3-inches of space between house and shrubs.

•  Remove all wood and stored items near the house.

•  Make sure all tree limbs are cut back from the roof and the side of the home.

•  Remove and/or unlock all doors so an inspector can have access.  This includes gates on fences, electric service panels, crawl spaces, closets, and access to pier and beam construction.

•  Inside the home make sure the inspector has easy access to electric service panels, water heater, furnace, attic, heat and air-conditioning equipment.

•  Insure GFI circuit breakers are installed and working properly in kitchen and all bathrooms.

•  Make repairs to following items if needed: door knobs, locks, window screens, broken windows, gutters, downspouts, water faucets, chimney, and windows and doors are properly sealed.