Unwarranted condo? Should I buy?

Should you buy a condo that is unwarranted?  This is a great question.  What exactly does it meant to be unwarranted?  “Condo projects and properties which don’t meet Fannie Mae and Freddie Mac warrantability standards are known as non-warrantable. Meaning the financing may be harder to obtain” says Gina Pool-The Mortgage Reports.

“Condo projects and properties which don’t meet Fannie Mae and Freddie Mac warrantability standards are known as non-warrantable.

Non-warrantable condos are more challenging to borrow against.

Typically, a condo is considered warrantable if:

  • No single entity owns more than 10% of the units in a project, including the developer
  • At least 51% of the units are owner-occupied
  • Fewer than 15% of the units are in arrears with their association dues
  • There is no litigation in which the homeowners association (HOA) is named
  • Commercial space accounts is 25 percent or less of the total building square footage

Because of these rules, some of the common property types which fall into the non-warrantable category include condotels, time shares, fractional ownership properties, and other projects which require owners to join an organization, such as a golf club.

Manufactured housing projects and other developments which are not legally considered real estate are also excluded from warrantability, including house boat and motor home projects.

When you’re buying a condo, one of the first questions you should ask your real estate agent or lender is related to the building’s warrantability.

A warrantable condo will get you access to lower mortgage rates than a non-warrantable condo because warrantable condos are lower risk to the bank.” According to a recent article written by Gina Pool- The Mortgage Reports.

As a buyer it is very important to do your due diligence in determining all the facts about a condo development before making the decision to purchase.  You will need to have a detailed conversation with both your agent and lender to make sure you fully understand the risks involved in purchasing an non-warrantable condominium.

Posted on April 8, 2016 at 5:27 pm
Bradley Mulliner | Category: Uncategorized

Appraisal Woes in 2016?

“The fourth quarter RESI found that title agents continue to believe that property valuation issues will be the most likely cause of title order cancellation over the coming year.”

So far this year I have already had to deal with a low appraisal and I have had other agents comment on the same issue, especially when the appraiser has been out of area appraiser. This caught both myself and the listing agent off guard as we both had supporting comps that supported both the listing price and the offer price.

“This shouldn’t come as a surprise. In a housing market where supply is very low and demand is very high, home values increase rapidly. One major challenge in such a market is the bank appraisal. If prices are jumping, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that closed recently) to defend the price when performing the appraisal for the bank.”

WORD FOR THE WISE

If you are listing your home and expect offers above listing price, be prepared for the conversation that the appraiser may not show the same value as the offer presented.  Make sure there is a significant down payment and that you have a plan in place for negotiation in this situation.

If you are a buyer and you not putting a significant down payment down on a home, your agent had better be sure that the offer is supported by comparable comps and as recent as possible. Another buyer beware opportunity for the buyer to avoid the pit falls of not getting the home you love because of the appraisal.

Bottom Line

“Every house on the market has to be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. ” According to an article by Keeping Current Matters.

Let’s get together and discuss how this may impact the sale of your home.

Posted on March 4, 2016 at 4:25 pm
Bradley Mulliner | Category: Buying/Selling Tips, clients, Helpful Articles, new home owners, Uncategorized

What is the forecast like?

Holding Firm Against the Tide | Realtor Magazine

 

Steady U.S. economic growth will help lift home sales moderately in 2016, but persistent inventory shortages will continue to put upward pressure on prices, holding back first-time buyers. That’s a thumbnail of the year ahead for home sales, according to NAR Chief Economist Lawrence Yun.

Home buyers are difinately feeling the pinch as they are trying to find homes to purchase.  Portland and its surrounding areas found the lowest months of inventory in the month of Decmeber.  What is the forecast like for 2016? click on this article for a glimpse of whats to come in 2016.

http://realtormag.realtor.org/news-and-commentary/economy/article/2016/01/holding-firm-aga

Posted on February 2, 2016 at 12:15 am
Bradley Mulliner | Category: Uncategorized

Portland homes selling in less than a month in Q3.

Portland homes selling in less than a month in Q3.

Still not sure whether or not it a good time to sell your home?  Homes are definitely selling quickly as long as they are price right. Yes this is still a sellers market in most areas around the Portland market and with the lack of inventory it appears that it is going to remain this way for a while.

SEATTLENov. 12, 2015 /PRNewswire/ — Matthew GardnerWindermere Real Estate Chief Economist, found Portland homes were on the market an average for just 27 days in the third quarter of 2015. This represents a drop in 10 days from the second quarter. Multnomah and Washington Counties also saw homes sell in less than a month.

“The average time it took to sell a home in the region was 92 days, with thePortland market in particular dropping from 37 to 27 days. This shows that the hot Portland economy is causing the demand to keep supply flying off the shelves,” said Gardner. He added one caveat, “There was a decline in state employment in September and the unemployment rate did rise, but I do not see this as a trend so much as a temporary blip.”

Looking at how the situation compares to the same time last year, the supply shortage drove home prices 6.1 percent higher year-over-year to $309,565. “What’s more impressive, sales activity rose by 21.6 percent when compared to the third quarter of 2014, exceeding the 20.9 percent year-over-year growth rate that we saw in the second quarter,” said Gardner.

As a result, Gardner believes that the housing market has tipped even further in favor of sellers. For Portland area buyers, this means it’s more important than ever to do the prep work to be able to move fast when buyers find a home they wish to buy:

  • Get pre-approved for a mortgage in advance (unless making an all-cash offer), and be ready to document the funds to be used for a down payment.
  • Retain an experienced buyer’s agent, who knows the local area and whom you trust. Go with them to see properties within 24-48 hours of listing.
  • Have advance discussions on what to write into offers: escalation clauses, quickness of home inspection, and even offering to rent the home back to the seller after the sale to give them more time to move. If the buyers and their agent have already confirmed those decisions, they can move faster in writing up the offer when the time comes.

Matthew Gardner joined Windermere Real Estate in July 2015 as its national Chief Economist with over 25 years of professional experience both in the U.S. and U.K.  Gardner has watched the Oregon economy and housing market for his entire career, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics.

To read more from the third quarter Gardner Report and about Matthew Gardner, visit http://www.windermere.com/blogs/.

About Windermere Real Estate

Windermere Real Estate is ranked the largest regional real estate company in the Western U.S. with over 300 offices and 7,000 agents serving communities in AlaskaArizonaCaliforniaColoradoHawaiiIdaho,MontanaNevadaOregonUtahWashington, and Mexico. Last year, Windermere closed over 77,000 sides for more than $27 billion in dollar volume. The Windermere family has a proud heritage of serving our neighbors via the Windermere Foundation, which funds services for low-income and homeless families. Since 1989, the Windermere Foundation has contributed more than 30 million dollars towards improving lives in the communities where we live and work. For more information, visithttp://www.windermere.com.

If you are a looking at buying a home, in this article there are some great tips that you should do the make the process go smoother, or you can visit http://bradmulliner.com/buying-and-selling-tips/ for more information.

Photo – http://photos.prnewswire.com/prnh/20151111/286564

SOURCE Windermere Real Estate

RELATED LINKS

http://www.windermere.com

About these ads

Occasionally, some of your visitors may see an advertisement here.

Tell me more | Dismiss this message

Posted on November 13, 2015 at 7:27 pm
Bradley Mulliner | Category: Buying/Selling Tips, clients, Helpful Articles, new home, new home owners, Real Estate Activity, Uncategorized | Tagged , , , ,