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Covid 19 and Real Estate

The recent outbreak of Covid 19 is having a profound effect on the real estate market across the country.

Here in Massachusetts, recent government orders have significantly curtailed real estate open houses and other social gatherings. In addition, inspections of smoke and carbon monoxide detectors normally required prior to a closing may be deferred if the buyer contractually assumes responsibility for installing the detectors and the subsequent inspection happens within 90 days of the conclusion of the COVID-19 emergency.

For our part, due to the Governor’s advisories, our business office at 145 South Main Street in Bradford, Massachusetts will be closed to the public until further notice. However, we are actively advising clients (long-term and new ones!) on the real estate market via phone and e-mail. So, if you have any questions you’d like to talk about, please feel free to contact us. We look forward to hearing from you!


Five tips to make buying a home less “haunting”

Let’s face it – the process of buying a home can be intimidating sometimes. But there are things you can do as a consumer to help put your mind at ease. Here are our top five tips to make buying a home less of a “trick” and more of a “treat”:

1. Get pre-approved for financing.

It takes money – usually, lots of money – to purchase property. Sellers know this, so they often ask potential buyers to provide evidence of their financial ability before accepting an offer. To help improve your chances of getting an offer accepted – and to avoid pitfalls later in the process – do yourself a favor and get this evidence up front. Most commonly, this involves getting a pre-approval letter from a mortgage lender to purchase a home within a certain price range and according to certain terms. If you’re a cash buyer or using other funds (ie. a gift, inheritance, etc.), you can obtain certification from your financial institution that those funds are available and sufficient to cover a purchase. If you are able to, it’s always best to get this documentation before you start looking at houses to buy. Getting pre-approved doesn’t guarantee financing, but it does avoid lots of unfortunate entry-level decisions and help you focus on properties within your purchasing power.

2. Get a home inspection.

It’s unlikely that even a savvy home buyer can pick up on every potential defect in a home during a quick open house visit or a private showing. Plus, most of us aren’t professional contractors, so there are things we might miss or that might be difficult to find. That’s why it’s always a good idea to hire a home inspector to check these things out and advise you on potential issues before you sign a purchase and sale agreement. In Massachusetts, inspections usually must be conducted during a ten-day period between an offer to purchase and the signing of a purchase and sale agreement, or they are waived (note: these deadlines can vary based upon your sales contracts, so be sure to consult your agent and/or attorney).

3. Know when to go beyond a home inspection.

There are certain things a typical home inspection might not cover, such as septic systems, private wells, swimming pools, and contamination by lead paint, mold, radon, asbestos, or pest infestation. The list goes on. Sometimes you need to ask to add these items on to your typical inspection order. Other times you need to hire a specialist to look at them separately. Be sure to ask up-front and get the advice you need in a timely fashion.

4. Resolve complex issues early on.

Depending on the property you’re buying, strange issues can pop up. For example, maybe there is a question about boundary lines or easements on the property. Maybe the person living there has unsatisfied liens on the property, or owes back taxes, or doesn’t yet have the legal right to sell (such as if an estate is trying to sell property before getting court approval). If you’re applying for a mortgage on the property, sometimes these issues will be identified by your bank. Even so, it can be wise to consult an attorney to answer any questions about a property and to get these issues resolved before the closing.

5. Educate yourself about the area.

It’s important to remember that we refer to a “piece” of property because land is part of a bigger puzzle, be it a neighborhood, or a region, etc. No home is an island in and of itself (unless you’re actually buying an island). Before you buy, ask questions about the surrounding area to make sure it suits your needs. Is it noisy? How is traffic? Do these factors vary on weekdays, weeknights, and weekends? Is there a lot of criminal activity in the area? Is the property convenient to shopping, highways, etc. If you have children, how are the schools? Is the property zoned for whatever you intend to do with it (or if you want to do additional work)? Is it in a flood zone, and if so, do you need to buy flood insurance? Are there any other hazards nearby? If it’s a condominium, what are the association’s rules, and how are the finances? Asking these and many more questions is usually referred to as doing “due diligence,” and it’s an important part of the home buying process. Make sure you do as much research as you can before you buy to avoid surprises later.

When it comes to buying property, don’t be haunted by problems! Ask your real estate agent for advice and guidance throughout the process.

Seller Alert: Keep an eye on proposed transfer tax hikes

Seller alert: there are some proposals floating around Beacon Hill right now that could make selling your home more expensive.

Gov. Charlie Baker has proposed increasing the housing transfer tax to pay for climate change initiatives. This tax is a burden Massachusetts home sellers must pay when transferring ownership of their home to a buyer. For every $500 of your selling price, the state of Massachusetts charges you a $2.28. Baker wants to increase this tax to $3.42, and housing advocates are looking to DOUBLE the tax to $4.56.

Here’s a breakdown of how those proposals would affect your sale:

Say you’re selling your home for $350,000:

  • Under the current real estate transfer tax of $2.28, you’d be responsible for paying $1,596 to the state.
  • If Gov. Baker’s proposal for $3.42 is approved? You’d pay $2,394.
  • If housing advocates have their way of doubling the tax? Your tax burden goes up to $3,192.

When selling your home, every dollar counts. Even if you support the initiatives this tax increase would support, you’ll want to know your bottom line when it comes to your financial picture in a real estate transaction. That’s why we’ll be keeping a close eye on the Legislature as they work to wrap up their business for the year. We’ll keep you posted!

How solar panels can affect a home sale

You see the solar energy sales reps going door-to-door on your street, and maybe your neighbor recently had solar panels installed on their roof. It sounds like a great deal (for your wallet and the environment), but how will it affect your ability to sell your home in the future?

According to the U.S. Department of Energy’s Office of Energy Efficiency & Renewable Energy, a recent study found that home buyers have been willing to pay a premium of about $15,000 for a home with an average-sized solar array.

However, not all home buyers feel this way. Some people don’t like the look of the panels on their roof. Others may not be happy with the contract you signed with the solar company that installed your system.

We’ve seen this come up while house hunting with our buyer clients. Often, the sale of the home does not end the contract with the solar company. The buyer is either required to take up the already existing contract, or pay to have the panels removed. In those cases, the buyer might decide not to pursue purchasing your home.

If you decide going solar is worth it to you, just be sure to carefully read the sales contract so you know what to tell potential buyers if you ever decide to place your home on the market.

Haverhill home prices fell in April, but properties sold faster

HAVERHILL – Lyric Properties announced today that sales of single-family homes in Haverhill, Mass. increased during the month of April compared to the prior month, but prices were down.

“According to our review of data from MLS, 31 single-family properties were sold in Haverhill during the month of April, compared to 29 sales during March,” said Fred Van Magness, Broker at Lyric Properties. He said the data showed that during that same period, the average sales price of a single-family property decreased slightly, from $349,662 to $334,545, while homes were on the market for less time on average.

“Overall, the numbers show good news for both buyers and sellers,” said Meredith Landrum, a Salesperson affiliated with Lyric Properties and a resident of Haverhill. “People who were looking to buy a home during the month of April saw prices come down a little bit, making ownership slightly more affordable. But, competition in the market led to faster sales, which was good news for people looking to sell their home. It will be interesting to see how home sales perform as we edge closer to the height of the springtime real estate market.”

Lyric Properties is a real estate brokerage doing business in the Merrimack Valley. If you are interested in buying, selling, or renting property, please feel free to contact them for more information at (978) 494-4450.

All data provided by MLS-PIN for single-family property sales by all brokers during the stated period in the stated geographic area. Lyric Properties is not independently responsible for these sales or any data reported herein and makes no promise, warranty or representation as to the accuracy of the same. Prior sales are not necessarily reliable indicators of current or future market performance. Due diligence is always advised. Frederick Van Magness, Jr. dba Lyric Properties, MA Broker No. 149143, PO Box 533, North Reading, MA 01864. (978) 494-4450. www.LyricProperties.com. All rights reserved. Equal Housing Opportunity.

Buyer Beware! (Always do your due diligence.)

When you purchase a piece of property, there are always lots of factors to consider before you sign on the dotted line. You’re making a big purchase, so you want to make sure you’re properly protected from any (unwelcome) surprises later on.

For example, is the property you’re thinking of buying in good condition? How old is the roof? Does the heating system work? Does the property have a septic tank or a private well? Can you add on an extra room sometime in the future?

The process of answering these and many other questions is generally referred to as doing “due diligence.” In Massachusetts, much of this due diligence usually takes place during (or before) a ten-day window of time after an Offer to Purchase is accepted, and prior to a Purchase and Sale Agreement being signed. And, in almost all cases, the responsibility for doing due diligence rests solely with the Buyer individually.

Having said that, you need not feel that you’re alone. Many questions are best answered with the help of qualified professionals. For example, a home inspector can tell you lots of things you might not have realized about the condition of your property and the major systems within. A visit to the code enforcement officer can tell you about zoning and other property features. If you’re buying a condo, you probably also want to check with the homeowner’s association to review applicable rules and financial information.

Other questions require a little more legwork. For example, you might want to find out if the property you’re purchasing is in a flood zone or historic district. That could become a financial burden or limit what you can do with the property. You might wish to know more about local schools, if that’s important to you, or the proximity to other nearby amenities. You might also want to know more about whether there is a lot of crime in the local neighborhood, or if any sex offenders live there. The list goes on and on.

Your real estate agent can help to guide you through the process and make suggestions. But, remember: since you’re the one spending the money, it’s up to you to make sure you do the research you need to satisfy yourself with the quality of what you’re buying. In fact, in many cases, ethical and legal rules limit or prohibit your real estate agent from answering these questions on your behalf. It’s also your responsibility to make sure you find out all the answers you need in a timely manner — usually, not later than the expiration of the period for inspections stated in your Offer to Purchase (assuming you reserve this right for yourself in your Offer — usually a smart consideration!), and sometimes before you even submit an Offer to buy the property. If you wait too long, you might jeopardize your ability to cancel your intended purchase or possibly obtain a reduction in the purchase price to cover needed repairs.

As the saying goes, “Buyer Beware!” Always make sure to do your due diligence before you buy property, and make sure you answer any questions about it before you commit yourself.

The spring market is coming. Thinking of getting in? How to decide if you’re ready.

Although parts of Massachusetts are still blanketed in snow, the calendar says spring officially kicks off this week. Along with (hopefully) better weather, that also means the spring real estate market will start showing signs of life.

If you’ve been toying with the idea of selling or buying a home, you might be wondering if now is your time to take the plunge.

Entering the market is a big decision, one that we know is not taken lightly. Not only are you dealing with a huge transition from one living space to another, the process of selling or buying a property is a pretty big commitment. You’re looking at keeping your house tidy for showings and open houses (as a seller) or giving up some nights and weekends to tour homes and put together offers (if you’re the buyer).

Here are a few questions to ask yourself when deciding whether this is the spring you’ll make your move:

What’s your local market look like?

We always recommend contacting a local real estate agent in your community or the community you’d like to move to in order to get a full picture of what’s selling and what’s not at this moment in time.

When buyers or sellers approach us, we get information about the size, style and design of their house or desired house and then run a report using the Multiple Listing Service (MLS) to see what comparable homes are selling for and how fast they are going under contract.

For a deeper dive on this, please check out our post on an important market factor known as the “absorption rate.”

What’s going on in your life right now? CAN you make a move?

Even if the market where you live or want to live is going gangbusters, it still may not be YOUR time.

Shopping for a house or offering your home for sale is a big deal. Even if your real estate agent (and we definitely strive for this) makes the process as smooth as possible, there’s still a lot for you to do.

If you’re buying, you’ll be spending a lot of time shopping around, attending open houses and showings. You’ll potentially be working with a mortgage company to get approved for a loan, which requires pulling together a lot of information about your personal financial history. You may also be rushing around to put together offers with your agent if a home you want is also wanted by a bunch of other buyers.

If you’re selling, you’re potentially looking at making repairs or cleaning out your house to get it ready for sale. You’ll need to be ready to get out of your house quickly when a potential buyer wants a showing, or be prepared to be away all morning for an open house. If you’re moving to a new property, you may also have all the work of being a buyer at the same time.

Again, at Lyric Properties, we totally get this and try to assume as much of the load as possible, but there are some thing that only you can do. If you know that your personal circumstances will make all of this impossible or too much of a burden, you may want to consider waiting until later in the year to make a move and enter the market.

Are there repairs you want to make before you sell?

This is a decision you can make with your real estate agent once they give you their opinion on what price you might want to list your house for. It could be that your home DOES need repairs, but you’d rather not put any more work into your property and perhaps you’re willing to sell for a little less to compensate for that. Maybe that means that you’re ready to plant a For Sale sign on the first day of spring.

However, if you feel you might be able to list for more, but you need to first repair your fence/upgrade your bathroom/put in newer kitchen appliances, how much time do you need to get that done? If you want to take advantage of the spring market, you probably want to start making those changes NOW.

For more information on how much value you might be able to get from making certain repairs in your home, check out this post.

Finally, does it really matter what the calendar says? What are YOUR goals?

There’s no doubt that the market dips and rises throughout the year. But we’ve sold houses in every season, from the middle of winter to the height of summer. The most important thing we’ve seen for buyers and sellers is entering the market is taking the plunge when it’s PERSONALLY RIGHT for them.

If you’re still not sure, we’re more than happy to talk it through with you and even help you make a list of pros and cons, if that’s helpful. If you run into an agent who is pressuring you to sell RIGHT NOW, question it. (And then call us. Ha ha.)

For an analysis of what your home might be worth in the current market, please contact us online or call us at 978-494-4450. We’ll be ready to go when YOU are.

The one thing that everyone wants to know about the real estate market

We talk about real estate with lots of people every day. Inevitably, unless we’re talking about a specific property, the conversation usually boils down to one simple question: “How’s the real estate market these days?”

Agents at many real estate brokerages are trained to give a canned response to this question. Namely, something like, “It’s always a great time to buy or sell!” That’s trite, but not very helpful. As real estate professionals, we aim to dig a little deeper.

There are several ways to look at market performance. In many cases we use a metric called the “absorption rate” to advise our clients on market trends.

Simply put, the absorption rate looks at how quickly the inventory of properties for sale in a given area is being consumed (or “absorbed”) by buyers. This statistic is generally expressed as a number, representing the number of months it likely would take for all the properties for-sale right now in a given market to be bought by buyers (theoretically, on average, and assuming that recent sales trends were to continue). An absorption rate of six (ie. it would take six months for the current inventory of homes for sale to be consumed, on average, given recent market data) is generally considered to be a “balanced” real estate market. Absorption rates below six are generally considered to be favorable to sellers, since lower rates mean properties are selling relatively faster than in a balanced market. Absorption rates over six are generally considered to be favorable to buyers, since relatively slower sales mean more available inventory to shop.

Here’s an example. According to MLS-PIN, during 2018 the absorption rate for single-family homes in Haverhill, MA was 1.08. That figure tells us that (on average) there were enough houses on the market at any given time to satisfy the interests of available buyers for a little more than a month (ie. 1.08 months). In 2017, the absorption rate was 1.53. So, generally speaking, the real estate market for single-family homes in Haverhill became slightly more favorable to sellers from 2017 to 2018.

Now, in the real world, it gets a little more complicated. Yearly municipal averages are informative, but if you’re buying or selling a home, you might want to know more detailed information. For example, maybe you’re looking for property in a specific neighborhood, or price range. Maybe you want to know more more about how market performance changes from season to season, or month-to-month. And, since statistics like the absorption rate are just theoretical averages, maybe you want to know how what market trends might mean for your specific property.

As real estate professionals, we have access to all of this information and more, so that we can provide our clients with timely and informative data specifically tailored to their individual needs.

If you’re interested in knowing more about how the real estate market is performing in your area, please sign up to receive market updates from us.

“Should I remodel before I sell my home?”

One of the questions we get asked the most by people who want to sell their property is whether they should make any repairs/upgrades before they sell, and if so, whether it will increase the sale price of their house.

According to a recent “Remodeling 2018 Cost vs. Value Report” (www.costvsvalue.com) [1], the answer depends a lot on what type of work you’re thinking of doing.

The report analyzed a wide range of possible upgrades, everything from smaller projects (like replacing a front entry door) to large-scale renovations (like adding on a master suite addition). Based on its findings, virtually every upgrade studied would increase the resale value a homeowner could expect to receive by selling their home. However, the value of that increase depends a lot on the financial outlay the homeowner would have to make to do the work. Some projects, like a mid-range patio installation, would allow homeowners to recoup only about 48% of the cost of the renovation. Others, like major kitchen and bathroom remodels, could result in much higher amounts of costs recouped (in the 75-90% range).

Ultimately, the number one repair for Boston-area homeowners turned out to be the replacement of a garage door with an upscale remodel. According to the report, homeowners could expect to receive a return of 104.5% for any investment made to make such a repair, resulting in a net profit of about $200 upon sale, on-average.

We are intrigued by the information in the report, and we find its conclusions to be very interesting. But, in the end, we also think that the topic of home repair is very subjective, depending a lot on the individual characteristics of a specific property and the market in which it will be sold. Every home is a separate case. As real estate agents, we have experience advising homeowners on such matters and providing them with localized information about how home repairs could benefit their chances of selling their home. If you’re interested in finding out more about how such changes could improve your home’s value, please contact us.

[1] “Remodeling 2018 Cost vs. Value Report”, (c) 2018 Hanley Wood Media, Inc. Complete data from the Remodeling 2018 Cost vs. Value Report can be downloaded free at www.costvsvalue.com.