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Metro Districts

Posted by on 7:52 pm in Uncategorized | 0 comments

With the new property tax assessments coming out, there has been a lot of discussion about not only property values, but also property tax amounts. You may have heard of, or be living in, something called a Metro (Metropolitan) District that is one of the entities that you pay property taxes to.  There are several type of Special Districts in the Carbon Valley area ranging from Fire, Library, or Recreation to Metro Districts. In recent years, many new developments have been done using a Metro District as a development tool to finance the development of the subdivision.  Basically, instead of the developer putting up the money to put in infrastructure such as utilities, sewer lines, streets, etc., a special taxing district is formed to finance those improvements.  Then, those costs are paid for over time through property taxes rather than in the lot or home price.  So, theoretically, you are purchasing the new home for a lower price because you are paying for the development over time through the Metro District. Because of problems with Metro Districts in the past, they are now limited to the number of mils they charge.  Many of the districts in the area are in the 40 to 60 mil range, but I’ve seen as high as around 80 mils.  Sometimes, the mil levy also takes care of things other than infrastructure such as open space, common areas or other amenities for the development.  In that respect, they are kind of operate similar to an HOA, but they are structured differently. To give some perspective, most areas within Frederick, Firestone and Dacono that don’t have Metro Districts, have a mil levy rate of about 100 mils.  Within a Metro District, that total mil levy is around 150, so that is why the property taxes are higher.  If two homes have the same assessed valuation, the property taxes for the one not in the Metro District would be about 33% lower. If you want more information, the State of Colorado’s Department of Local Affairs (DOLA) has published Special Districts: A Brief Guide for Prospective Homeowners.  Give me a call and I’ll email you a copy. Greg Zadel  CRB, CRS, GRI Zadel Realty 8110 WCR 13 S-4  Firestone, CO.  80504 o. 303-833-3012  f. 303-833-3054 greg@zadelrealty.com...

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Buying a New Built Home

Posted by on 7:41 pm in Uncategorized | 0 comments

Do you need a Realtor representing you when buying a new home from a builder?  Technically, no, but then you would have no one on your side.  As a Buyer’s Agent, your Realtor is representing your interest when you purchase any home, new construction, resale or a repo, and in most every case, your agent is paid by the seller or listing brokerage. The sales price is no different if you are represented by your own agent or if you work directly with the builder’s staff at the sales office.  With the price not being any different, and the builder paying your agent, there is no reason not to be represented when you are buying a new home from a builder.  The builder’s sales staff are usually very knowledgeable and friendly, but they are looking out for the builder, not the buyer. In many cases, you can’t change what is being offered by the builder, but having another set of eyes involved on your side is beneficial in several ways.  First, in helping you decide what options make sense for you to get, your Realtor can give you advice on what items will help down the road for resale, and which ones will not.  That doesn’t mean that you won’t get a specific feature, but at least you will make an informed decision. Next, your Realtor will be there with you to go over the purchase contract and help make sure you understand things.  Builder contracts are written by the builder’s attorney for the benefit of the builder, so you need to make sure you understand things.  You also have someone on your side all through the process so that you can ask questions or handle issues that can come up, such as if a particular option you contracted for was overlooked. When it is time for your walk through, your Realtor provides an extra set of eyes to pick up on punch list items that need to be taken care of.  Then, prior to, and at closing, you have your agent to go over and discuss your settlement figures showing all the debits and credits and the amount you need to bring to buy the home. Most builders have specific processes for registering you and your Realtor, so be sure if you stop by a builder sales office to let them know who your Realtor is and then let your Realtor know what builder you stopped by.  There is no substitute for having a professional on your team. Greg Zadel  CRB, CRS, GRI Zadel Realty 8110 WCR 13 S-4  Firestone, CO.  80504 o. 303-833-3012  f. 303-833-3054 greg@zadelrealty.com...

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REALTOR’S REAL WORK BEGINS WITH THE SALES CONTRACT

Posted by on 7:47 pm in Uncategorized | 0 comments

Much of the work your Realtor does to accomplish the purchase or sale of your property is “behind the scenes.” A Realtor may look calm like a duck on a pond, but underneath they are working hard to keep everything going forward. After an offer has been accepted on a property, the real work begins. Title insurance is ordered to show what items need to be addressed in order to transfer clear title to the buyer, as well as to reveal any restrictions or easements that affect the property. Copies of these documents may be required and they must be delivered in accordance with the contract terms. The same goes for the HOA information, if that applies. In most contracts, the buyer has an opportunity to perform physical inspections of the property. These must be coordinated by the Realtor, as well as any follow up questions or negotiations.  The inspection is the most common reason that a contract terminates, so having an experienced Realtor on your side is critical.  In addition, property insurance and any home warranty policies must be taken care of. The loan process is an ongoing and often very time-consuming process for the Realtor. The appraisal, survey, verifications and other items need to be addressed during the process. Appraisals can be a cause of great anxiety in today’s market because of increasing values. The Realtor tries to provide the best information possible about current sales, so that the appraiser can do the best job possible. The survey may done right before closing, and is typically not a problem on most newer properties. However, an encroachment or a variation in the property size can be a major problem for the lender and buyer. Steps must then be taken to resolve the concern prior to closing. If a property is on well and septic, the Realtor must gather additional information to make sure the proper permits have been issued and take care of the transfer of ownership. There may be testing required to make sure the well and septic systems are up to standards. Sometimes the property or buyer involved does not fit perfectly with the lender’s ideal criteria, so further explanation and information must be gathered. If problems are not solved in a timely manner, there can be delays or even a termination of the contract. Finally, the closing must be coordinated. This entails much more than just setting a time at which the buyer, seller, Realtors, title company and lender can all agree to meet. If the loan approval comes in at the last minute and the closing is at the end of the month, it can be a real juggling act. Often last minute documentation must be obtained or change accommodated. After all of this work, time, worry, effort, frustration and follow-up, there is usually a successful closing. Most Realtors are problem solvers at heart, and they get to put this skill to work on most transactions Greg Zadel  CRB, CRS, GRI Zadel Realty 8110 WCR 13 S-4  Firestone, CO.  80504 o. 303-833-3012  f. 303-833-3054 greg@zadelrealty.com...

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Unsolicited Offers

Posted by on 9:06 pm in Uncategorized | 0 comments

Our real estate market has seen substantial increases in prices over the past few years as well as a limited number of homes available on the market.  This has led to an increase in practices that can be detrimental to uninformed sellers.  Often times these are the elderly, people that have been in there home many years, estates, or distressed owners.  With all the information that is available on line, it is fairly easy to target these groups of potentially vulnerable homeowners. One way this is happening is that an investor or agent contacts a homeowner who has been in the home a long time and likely has a lot of equity.  The investor may offer a cash, quick sale at what appears to be a good price to the uninformed seller, even though it may be tens or hundreds of thousands below the actual market price.  With the home contracted at a below market price, the investor then would assign (flip) the contract to another buyer for the market price. Another thing that can be detrimental to a seller is an agent or potential buyer wanting to purchase the home before it goes on the market.  While there may be some benefits to the seller, anytime you limit the exposure of a property to the market, the likely effect is to sell for a lower price. These practices are not necessarily illegal or unethical, but may be victimizing an unsuspecting or uninformed homeowner.  Don’t be pressured or rushed into making a decision.  Check with a local Realtor to get a 2nd opinion on what your property is worth.  Listen to your gut instincts. Be wary of anyone that approaches you about a sale you weren’t planning on.  Talk to friends or family to get a reference for a Realtor that can give you trusted advice.  If you are not sure if the person is a licensed broker, check them out at www.dora.colorado.gov/dre. If you consider their offer, get advice or representation for yourself.  Have a Realtor or attorney on your side.  The investor that is making the offer is looking out for their best interests, not yours.  If they aren’t licensed brokers, they don’t have to follow the rules of the Real Estate Commission and if they are not Realtors, they don’t have a Code of Ethics to follow. Remember, exposing a property to the entire market is the best way for a seller to know that they’ve received the best price for the market. Greg Zadel  CRB, CRS, GRI Zadel Realty 8110 WCR 13 S-4  Firestone, CO.  80504 o. 303-833-3012  f. 303-833-3054 greg@zadelrealty.com...

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Does Homeownership Matter?

Posted by on 8:36 pm in Uncategorized | 0 comments

DOES HOMEOWNERSHIP MATTER?   You bet it does!  At the most basic level, it provides shelter and security to families.  But, there is a lot more to it than that, and here are some facts about homeowners from the National Association of Realtors, Federal Reserve Board, and the US Census Bureau: They are more likely to vote, They volunteer their time more frequently for charitable causes, They move less often, providing more neighborhood stability, The decision to stay in school by teenage students is higher for those raised by home-owning parents, Daughters of homeowners have a much lower incidence of teenage pregnancy, The median net worth of homeowners is 36 times that of a renter’s ($195,400 vs. $5,400), Owner occupied housing is better maintained than non-owner occupied property, In addition to being more satisfied with their own personal situation, homeowners also enjoy better physical and psychological health, Homeowners are less likely to report financial hardships, The average child of a homeowner is significantly more likely to achieve a higher level of education, and thereby, a higher level of earnings. These are some of the reasons that homeownership is called the “American Dream”.  Taking the big step from renting to owning can be a difficult one, but with planning and patience, it can become a reality.  Your Realtor is not just here to help you become a homeowner, but also works hard to protect private property rights, on the local, state, and national levels. Greg Zadel – 2011 Realtor of the Year, Colorado Association of Realtors Zadel Realty 8110 WCR 13 S-4 – Firestone, CO.  80504 o. 303-833-3012 greg@zadelrealty.com...

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First-Time Homebuyer Savings Accounts

Posted by on 6:03 pm in Uncategorized | 0 comments

With the help of the Colorado Association of Realtors, the State of Colorado has set up a program to allow any Coloradan to set aside up to $50,000 toward the costs of closing on a home.  The earnings on those funds (interest and capital gains) are free from Colorado state taxes. FHSAs (First-time Homebuyer Saving Accounts) are a great way for future homeowners to start saving ahead if time for the costs of buying a home.  The initial down payment and closing costs are often times the impediment that keeps people from getting their first home and this is a step to help solve that problem. These accounts are simple and easy to set up.  Not only can you open a new one, you can also designate almost any existing account as an FHSA.  To create an FHSA, you simply include a form when you file your state taxes.  The form will indicate that you should not be taxed on any earnings because of the account’s FHSA status. After you use the money toward the closing costs on a first home purchase (yours or someone else’s), you send in a different form to the Department of Revenue showing that the funds were put toward an “eligible cost”. The money can be used to pay for someone else’s closing costs as long as the person you’re giving the money to is a first-time homebuyer.  As with any tax related program, be sure to talk to your tax advisor to see exactly how this would work for you.   Greg Zadel  CRB, CRS, GRI, e-Pro Zadel Realty   303-833-3012 8110 WCR 13 – S-4 Firestone, CO.  80504 Greg@ZadelRealty.com...

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Computerized Home Valuations

Posted by on 5:51 pm in Uncategorized | 0 comments

Homeowners are often looking online to see what the value of their home is.  Everyone is curious about value and how it might be changing and an estimate of the value of their home.   It may be from an AVM (Automated Valuation Module) on a Broker’s website, an estimated value from Realtor.com, or a Zestimate from Zillow.  All of these are an estimated of the value of a home by a computer program, known in the industry as an AVM.  AVMs were initially developed for use by large financial institutions to value large portfolios of loans, and with working with large numbers, the individual errors in valuation don’t matter much. How accurate are AVMs?  The “gold standard” for an AVM is to be within 10% of a home’s actual value 90% of the time.  Most valuations you see online are in the low 80 percent range.  To illustrate how this works, say the property is worth $300,000.  The best of the computerized valuations would show an estimated value of between $270,000 and $330,000, 90 percent of the time.  The other 10% of the time they would be outside that $60,000 range.  Not very accurate! “But it is on the internet, it must be true.”  Well, not really.  First of all, the computer hasn’t seen the home.  Properties vary greatly due to upgrades, condition (good or bad), functionality, and features.  The computer is getting its information mainly from public records.  Even if a person has the ability to change some of the inputs, do you really know the local market and what buyers are looking for and what they will pay for things? The program then compares the home to other properties that have sold in the area.  Here again, the computer hasn’t seen these homes either, nor can it make judgements like a local expert could.  The more variation there is in an area, the less accurate the valuation, because the computer doesn’t know the individual neighborhoods or the variation in housing.  The value may be more accurate if the home is in a larger subdivision of very similar homes, but it still can’t know specifics about location, buyer or seller motivation and local market conditions. The bottom line is that while and AVM may give you a general idea of the value, you need a knowledgeable, experienced Realtor to look at your home, evaluate comparable sales and the overall market in order to have an accurate price.  Have fun looking at online values, but don’t make decisions based on them. Greg Zadel, CRS, CRB, GRI, ePro Zadel Realty 8110 WCR 13 S-4  Firestone, CO.  80504 office. 303-833-3012 | fax. 303-833-3054 Greg@ZadelRealty.com 2011 Realtor of the Year, Colorado Association of Realtors 2008 President, Colorado Association of...

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Real Estate Investment Property

Posted by on 5:10 pm in Uncategorized | 0 comments

  Many people have looked to the Real Estate market as a place to diversify their invest portfolio.  The idea of having someone else make the payments on your property so that you gain equity is very appealing.   One of the ways to become a landlord, is to buy a new home for yourself and keep your existing home as a rental property.  As with any method, you must analyze what best meets your specific needs.  In the current market, we are starting to see a little more inventory in the move-up price ranges due to more new construction, so in those price ranges you are not in a bidding war for a property.   The first consideration is whether or not your current home would make a good rental.   If the property is in the lower to middle price range in an area, it may be a good rental.  Conversely, a higher priced custom home will not bring in the same proportion of rent to value as the lower valued house.   Advantages to this method of acquiring property can include an easier move, better financing, knowledge of the physical condition of the rental property and a way to move up in house and build long term wealth.  Since you would be purchasing a new home to live in, the timing and moving is under your control and since you are already very familiar with the home, you know potential physical problems that you would have to deal with.   Financing can be an advantage because it can be more cost effective to use the equity in your current property, which can be taken out at a lower interest rate.  Instead of needing to save up a large cash down payment, the current home can be refinanced at today’s low interest rates.  Then, when you purchase the new home (with the down payment from the old one) you get another attractive loan as an owner-occupant.   Another important consideration is the management of the property.  Decide carefully between finding a tenant yourself and hiring a professional to manage the property for you.  You may save some money up front, but if you are not careful, doing it yourself can cost more in the long run.  Your retirement account can also own real estate, not just stocks or mutual funds, so for some people, this can be a good way to diversify a portfolio.  There are specific rules pertaining to this and not all account managers are set up for it, but it may be worth consideration.   Your Realtor can be of great help in starting you on the right path by looking at your specific needs and desires, as well as educating you on what you don’t know.  Owning real estate has been one of the great ways of building long term wealth that our country offers.   Greg Zadel  CRB, CRS, GRI, e-Pro Zadel Realty   303-833-3012 8110 WCR 13 – S-4 Firestone, CO. ...

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Are your HOA policies hurting your home value?

Posted by on 8:59 pm in Uncategorized | 0 comments

The more potential buyers there are for a property, the more likely it is that the price will be driven up.  The opposite is also true, if there are fewer potential buyers, the price will tend to be pushed downward.   Over the past couple of years, we are seeing HOA’s adopt policies that may be hurting the value of their home owners by having policies that drive away potential buyers for the area.  While it is likely that this is not what was desired by an individual policy, the unintended consequence is that these properties end up more expensive to purchase and thus the number of potential buyers are reduced.   The specific policies I am referring to usually take place in a few areas.  First, in getting a potential buyer access to the HOA information and documentation.  When a purchaser is looking to buy in a given neighborhood that has a HOA, the buyer will want to review the HOA rules & regulations, newsletters, meeting minutes, covenants and other pertinent information.  Most Associations have moved this information online so that access is quick and easy.   Unfortunately, some HOA’s have instituted policies that require a potential buyer to register and pay for the ability to review these documents.  One of the buyer’s first impressions of the neighborhood is then very negative compared to other areas.  If they have to pay for this access, they are likely to want to pay less somewhere else, which is typically on the sales price of the home.  This charge can also act as a deterrent to purchasing in this subdivision as compared to another that does not have the fee.   The second, similar problem is with transfer fees.  Some HOA’s charge excessive or different transfer fees, depending on the seller of the property.  If the seller is a bank, or HUD, the transfer fee is doubled or tripled.  What is not realized is that in most all of those transactions, the transfer fee is passed along to the buyer, thus increasing the cost of the transaction to the buyer.  Again, when the cost is increased in a fee, the amount the buyer is willing to pay for the property decreases, thus hurting the property values in the neighborhood.  Similarly, the buyer may just choose to look at other homes without the additional fee, thus decreasing the number of potential buyers for a given subdivision.   The third area we are seeing difficulties with is in communication.  Often times during a transaction, the buyer or seller will need to contact the HOA regarding a specific issue.  If it takes more than a few days to speak to someone, that can cause problems in the transaction.   There are benefits to having an HOA in a subdivision and often times, that can be one of the reasons that people buy a particular property.  You just need to look out for the unintended consequences.  Be involved in your local HOA so that it can be an asset for your neighborhood.   Greg Zadel, CRB, CRS, GRI, e-Pro Zadel Realty   303-833-3012 8110 WCR 13 – S-4 Firestone, CO.  80504 Greg@ZadelRealty.com...

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You Don’t Know What You Don’t Know

Posted by on 9:21 pm in Buying | 0 comments

This saying is especially applicable with real estate transactions.  Even those that have bought or sold several homes rarely do it often enough to keep up with all the complexities of a real estate transaction.  For most people, buying a home is one of the largest purchases (and financial commitments) they will ever make.  You need to make sure that you have the most complete information possible, as well as sound advice when you are making all of the decisions surrounding the purchase of a property. Picking the right home is just one of the decisions you will make.  Others include:  What price to pay?  How to structure the financing?  What about closing costs?  How to best negotiate the offer?  Title?  HOA?  What inspections issues should be addressed?  Appraisal?  Loan conditions?  What timeframe for the transaction?  What about possession? These are just a few of the issues to be addressed during the process, and they are looked at differently if you are the Buyer or the Seller.  The input and advice you get from your Realtor, working as a Buyer’s Agent or a Seller’s Agent will help you immensely in the process.  Your Realtor’s experience will not only help you understand the issues, but will bring to your attention issues you may have not contemplated.   The Realtor is not there to make the decisions for you, but to help you in understanding the issues and your alternatives completely so that you can make the best decision possible. Take some time to select the Realtor you will be working with, either when buying or selling.  Ask about their experience, background and office support.   Make sure it is someone that you are confident in, trust, and you are comfortable working with.  Ask others about the Realtor and talk to others they have worked with.  Discuss how you would prefer communications.  Buying or selling can be an intense and somewhat stressful process, but the right Realtor can make it as smooth as possible, and even a little...

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