Home Inspections for the Home Buyer

When a buyer finds the home they love, their offer is accepted, and escrow is opened, the next step is having the home inspection.  Most home buyers have no idea how to select a home inspector, and will often make their decision on price. But, this is definitely NOT the time to shop for the least expensive inspector. You need a reputable inspector, one who is a member of the professional organizations for home inspectors in your area, one with experience, and one who has references.  In our area, an inspection of a home will run from approximately $450 to $600.

A home buyer usually pays for three items up front…the appraisal, the credit report, and the home inspection.  If the transaction does not close, they will not be reimbursed for the appraisal or home inspection (in most cases).   Home buyers need to remember that the purpose of the home inspection is to make sure the major components of the home are operating correctly….is there something that would cause you not to purchase the home if not corrected?  It is not a time to start asking for cosmetic repairs.  The inspector’s job is to find things wrong with the property, and they will!  Buyers are usually buying a previously lived in home. Some are lived in “considerately”; others are lived in a bit “rougher”.

I have rarely had an escrow fall out because of inspections.  A seller wants to sell the home and a buyer wants to purchase it, so we usually work out any issues that may arise.

Should a seller have a home inspection?

In most transactions, the buyer obtains a home inspection once a property is in escrow. This is at the buyer’s expense.  In California, our contracts state that the buyer is purchasing the home in its current and as-is condition, subject to buyer’s inspection rights.  In theory, this is great. But what often happens is that two weeks into a real estate transaction, there is a new round of negotiations.  The buyers usually ask for some repairs, even if they are minor.

For years home inspectors have encouraged sellers to obtain a home inspection prior to putting their home on the market.  Most sellers don’t and this has been the “norm” for years.

When I have clients who are selling a home they have not lived in, say for a family trust, I advise them to have a home inspection up front, at their expense. These sellers usually have very limited knowledge about the condition of the home.  We make the inspection report available to the buyer for their review, we can actually post it as an attachment in the Multiple Listing Service (and encourage them to have their own home inspection once in escrow).  The beauty of it is that the buyer can make an offer based on much more knowledge about the home.  After all, buyers don’t usually crawl up in the attic, or under the house, or get on the roof prior to writing an offer.

This helps both the seller in properly pricing a home, and a buyer in making an offer based on more information about the property.  For instance, when the seller has provided a home inspection and it indicates that the water heater is near the end of its life, the buyer can adjust the price of the price offered, or ask for the water heater to be replaced prior to close of escrow.  Alternatively, the seller can price a home at a realistic price, higher or lower, based on the condition of the home, having taken into account items discovered during the inspection.

Even for traditional sellers who live in their homes, I think it is a great idea to invest in a home inspection up front. If there are items that need attention, the seller has the opportunity to take care of them up front and make note that those items have been remedied.

Are You Sitting on the Fence ….. Waiting?

I see it everyday, cash buyers here in San Diego buying property….single family homes, condos, and apartments buildings.  They are coming to San Diego from all over the country.

Some are even coming from other countries. They can’t buy property fast enough.
So why are so many people here in San Diego sitting on the fence? Waiting to make a move and buy a home, or buy an investment property and start building their wealth?

For first time home buyers, you have to live somewhere, right?  You can continue paying rent and helping someone else build their wealth, or you can buy a home to call your own, where you can paint the walls any color you want, hang pictures wherever your want, grow a garden, have a pet without huge deposits. Did you know that you can sometimes spend less money owning your own home than you pay in rent?

Some of the best bargains in San Diego County are found in San Diego’s best kept secret….East County.  The communities of El Cajon, La Mesa, Santee, Lakeside, Alpine, Jamul, Descanso, and Pine Valley offer fantastic values.  How about a 5 bedroom home on 1.5 acres with oak trees and a seasonal stream for $484,599?  Yes, you can find it in Alpine.  What about a great investment property — a condo for less than $100,000? It’s in El Cajon.   Looking for a custom home with a view…have you checked out the communities of Horizon Hills or Hidden Mesa?  Want some privacy and a place for horses?  Have you seen Dehesa Valley?  Amazing values there!

Don’t miss out on the great opportunity this real estate cycle is offering…..its there for the taking!

How Can It Be A Good Time To Buy AND A Good Time To Sell?

I get asked this questions a lot!  How can this be so?  Well, because buying or selling a home is a very personal thing.  No situation is the same.  People are different and have different desires and needs.

We hear and read so much contradictory information about the market, it can be confusing.  The information coming at us is uncertain, so it’s no wonder that people are uncertain about what to do.

We have all read about the great reasons to buy:

  • Interest rates are at historically low levels
  • There is a good supply of homes for sale; prices are still at affordable levels
  • If interest rates go up 1% you can afford about 10% less in price
  • It’s a great time to buy investment property, or a second home

What are the reasons to sell now?

  • If you are going to move up, you will come out better in the long run. You may sell at a price that’s lower that what you want, but you will also be buying a home at a lower price than you could have a few years ago.
  • If interest rates go up a percent or two, prices will probably come down further.  And, rates are expected to go up.
  • Investors are still coming into our area, San Diego, with cash. 28% of the sales in San Diego County last year were cash sales, many from out of state buyers.
  • Most importantly, where do you want to be for the next one to eight years?  If you are happy where you are, great!  But if you want to move during that time, do it now!

I recommend that you obtain the information you need to make a good decision for you and your family, not what’s good for your friends or neighbors.  Talk to a professional about the market, look at the numbers, see what makes sense for you!

Don’t Believe Everything You Read!

Just read a great article from The KCM Blog, “Don’t Believe Everything You Read”,   . It’s probably not the first time we have heard that saying!

It is really difficult to sift through all the information the media is putting out there – the housing market is crumbling, the housing market is getting better, there are no sales, prices are going up, etc.!

In San Diego, where I work, the market is fairly flat; prices are still on the decline in most areas. Sales are down in some areas, but not all. The bottom line is that homes are selling every day.  If you are a buyer, there has not been a better time to buy a home, with the inventory, the prices, and the interest rates. This is a once in a generation time to buy a home….my advice is not to wait.

If you are a seller, prices are expected to continue to decline for a while; we are anticipating 3-10 percent in San Diego depending in where you live.  So, if you are thinking about selling, this is the time to do it!  It will probably be years before we see a significant increase in the price of homes.

In the last two years, I have worked with more cash buyers and more sellers who own their homes free and clear than in the previous 18 years.  When out-of-state buyers are bringing cash into California to purchase real estate, you know it’s time to buy!

So, if you’re on the fence, get off – let me help you get all the facts you need to make a well-informed decision about real estate!

Short Sales — Are There Options?

Short sales are becoming a way of life, kind of the norm in San Diego. Unfortunately, for too many families these days, a short sale may be the best option. . . but for others. . . well, here’s a true story.

I had clients who were being transferred, he had a government job that required a security clearance, which requires good credit. With prices falling, they were faced with moving hundreds of miles away and trying to rent their home…this would mean they could not purchase a home in their new location….or, was there another way of looking at the situation?  For this family, they made the decision to bring money to closing. It meant taking money from savings and some from 401k, and this isn’t for everyone. But in their situation it enabled them to sell their home and purchase their dream home with a VA loan. They happily moved last month.

I have had other clients borrow from family members and pay them back on a monthly basis. It enables them to keep their credit and move on, buy a new home.

Short sales will probably be a way of life for some time to come….but there may be other options..think about it…and, if you know someone who needs some help, let me know, I can help!

Who To Believe?

Have you read and heard a lot about real estate lately, all conflicting information? Prices are going up, going down, stabilizing? Homes sales are up, home sales are down?  It can be confusing!  Especially in this market where things are changing on a daily basis.

Think about this, interest rates are below 5%….historially low rates.  Yes, we are seeing interest rates at 4.5, 4.25, 4.75%…..unbelievable! 

And, people are taking advantage of this great opportunity….you can be one of them!


Welcome to my real estate blog.  For all the latest and greatest about what’s happening in San Diego real estate and real estate around the country, keep checking back for more exciting info!