Iowa City, IA

Buying a Home in Iowa City - Step 2: Choosing the right area to live

This is the second part in a 7 part series to give you as a home buyer a better idea about the home buying process in Iowa City.

Today I'm going to cover the question of choosing where you want to live. At the same time you want to consider the style and age of home you have in mind. There's no point looking for something that just isn't there - For instance a new ranch style home in downtown Iowa City!

First I want to touch on a subject that is very specific to people relocating to Iowa City. If you are relocating the area and your top priority is to live within walking distance of the UI Campus, then you need to be aware that there is a VERY high demand for that...

Higher demand generally means higher prices. That's the first thing. Then there's the fact that downtown Iowa City has some wonderful turn of the century homes in character filled historic neighborhoods. Finding a newer home on the other hand, that's a very different story. (Hence my comment earlier in my post). Some of the older homes have been updated, many have not. My point being that if you do want to live within walking distance of campus, you should know that your options are limited.

So now to the more universal aspects of choosing your area to live:

Price Range is obviously a huge factor when it comes to choosing where to live. Even in a small town like Iowa City the prices vary from neighborhood to neighborhood. Getting pre-approved of course will help you here and you'll be able to narrow your options on location by knowing where you can afford to live. This might be a good time to mention that if you get "sticker shock" when you see Iowa City prices, you may want to take at the surrounding areas, for instance North Liberty as an option. North Liberty is "hot" right now with home sales in July increasing by a massive 46% in comparison to last year.

Distance to your place of work, (or study) is another big one. Some people are fine with a longer commute time. Others prefer to live close by. Your personal preferences will factor into the location of your new home, along with the distance to schools and other amenities like shopping, restaurants, parks, fitness centers... In short whatever you think is important should be considered now. (You can always compromise later. To start out it's a good idea to make a "wish list").

An equally important factor is to decide whether you want to be close to relatives or friends in a certain area. This is often a big motivating factor when you have children. For instance living closer to grand parents where children go after school, or maybe best friends.

That just about covers the basics of how you go about narrowing down the area as you choose where you want to live. Remember to keep in mind the style and age of home as you consider the location. It used to be that location was everything in real estate. That's changed as buyers realize sometimes they need to compromise on location to get the type of home they really want to spend their time in. You might decide it's worth a 15 minute longer commute if it means you get the home that is perfect for you and your family.

The next step in process is Step 3: Finding the Right Home for You

Buying a Home in Iowa City: For your reference: links to all steps in my 7 part series:

Step 1: Getting pre-approved for a home loan
Step 2: Choosing the right area to live
Step 3: Finding the Right Home
Step 4: Making an Offer
Step 5: Home Inspections and Repairs
Step 6: Preparing to Close on Your New Home
Step 7: You're Closing on Your New Home

If you're new to the home buying process - a first time buyer or maybe relocating to the Iowa City area - all this information may throw up more questions than answers...There are a couple of solutions for that. You can either leave me a comment and I'll respond to that, or you can contact me directly either by phone or email, whatever suits you best.

Buying a Home in Iowa City: Step One: Getting Pre-approved for a Home Loan


This is the first part of a 7 part series geared towards "first timers". I'm thinking not only first time buyers, but also anyone relocating to the area. I figure folks relocating to the area are also first timers as generally if you're relocating to Iowa City you won't know the area. Then there's the fact that the buying process is a little different from state to state. (And very different if you're moving from overseas).

The very first step when you're thinking about buying a home is to start by finding out how much you can afford. Now of course there's nothing less exciting than a trip to a mortgage lender, (except maybe a trip to the dentist), but it is a necessary step and usually not nearly as painful as you imagine it will be.

How do you choose a lender? That's certainly one of the things I can help you with. Depending on what kind of home loan you're looking for there are a number of mortgage professionals I can refer you to. Here are a couple of questions I may ask you before referring you to a lender:

Are you looking for a loan with a low or no down payment option? Or... Do you intend making a large down payment of 20% or more?

For those looking for no or low down payment options there are several available here in the Iowa City area.

FHA loans offer a low down payment option and although there are a few lenders in town that offer them, I prefer to send my clients to someone who specializes in them. (FHA loans can be tricky, so you want to work with someone who knows the program inside out).

100% Financing Options are still available as in-house loans with some of the local banks here in Iowa City. They are usually 5 or 10 year adjustable rate mortgages (ARM's) and are very popular with people relocating to the area who know they may only be here for 3 to 4 years. Fellows or Residents to the UI Hospitals or Faculty and Students to the UIOWA spring to mind - There is a high demand for these loans as we do have a lot of people relocating to Iowa City.

I should mention that I also serve clients in the North Liberty area and there is another 100% financing option for rural areas in the form of the USDA loan. North Liberty is growing fast, but does still class as a rural area.

These are just a few examples and as you can tell from just this relatively small amount of information, depending on your circumstances there are many different loan programs, so it's really important for you to hook up with the right lender. If you'd like me to help you find the right lender to best serve your needs, just give me a call.

Pre-Approval vs. Pre-Qualification: Talking on the phone with a lender before visiting them is always an option and of course it saves on time. It's fairly simple to get yourself pre-qualified with just some basic information about your income and what kind of recurring costs you have every month. It's helpful as far as giving you a ball park idea of what you can afford, but is not really much help when it comes to making an offer. Ultimately, the information you give for a pre-authorization will need to be verified before a bank will pre-approve you for a loan.

For a full pre-approval it's better to visit the bank and provide the documentation required. A few of the lenders I work with in Iowa City will in certain circumstances pre-approve you over the phone if you provide your social security number and allow them to pull your credit to verify your recurring costs. This pre-approval would still be contingent upon you providing certain required documents as soon as possible.

*Documents Required by Lenders to secure financing:

Full Loan Application (If applying by phone this would be sent out by the bank the same day).
2 years of tax returns or W2 forms
Paycheck stubs for most current 30-day period
Monthly debt (who with, how much, loan number)
2 months recent bank statements to verify cash to close
Address of mortgage company or landlord for past 2 years
Drivers license (Legal aliens will also be required to provide visa or alien registration card)

*Depending on the loan, other documents may be required.

Comparing Lenders: It's always a good idea to compare lenders. Particularly closing costs vary greatly from lender to lender and you want to be sure you get the best deal. Making sure you get a GFE (Good Faith Estimate) is the only way to easily compare quotes, so make sure you get one from every lender you speak with.


Before you start looking at homes you really are best served by making sure you are pre-approved beforehand. Look at it this way: Can you imagine how heart breaking it would be to find "the perfect home" only to find you don't qualify for a high enough mortgage to finance it?

Here's the link to the next step in my series: Step 2: Buying a Home in Iowa City - Choosing the right area to live

Buying a Home in Iowa City: For your reference: links to all steps in my 7 part series:

Step 1: Getting pre-approved for a home loan
Step 2: Choosing the right area to live
Step 3: Finding the Right Home
Step 4: Making an Offer
Step 5: Home Inspections and Repairs
Step 6: Preparing to Close on Your New Home
Step 7: You're Closing on Your New Home

When you're new to the home buying process - a first time buyer or maybe relocating to the Iowa City area - all this information may throw up more questions than answers...There are a couple of solutions for that. You can either leave me a comment and I'll respond to that, or you can contact me directly either by phone or email, whatever suits you best.

Iowa City ACT Scores 2009

Big news in Iowa City this week - The ACT scores are in and Iowa came in 2nd in the nation again, with most area high schools in Iowa City scoring higher than the state average of 22.4.

West High School beat it's own record this year with an average of 25.8 out of a possible 36. City High's average was 24.8 with the Regina Catholic Education Center at 23.8. Visit the Press Citizen website for scores for other high schools in the area.

This is pretty important information for you if you're moving to the area. The ACT is an important measure of how well students are doing when it comes to being college ready after graduating from high school and is used by many colleges and universities in the decision making process with scholarships and to determine admission.

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The good news is that on the whole Iowa City is performing very well. Iowa City is one of the most educated cities in the country so that really shouldn't be such a surprise. The University of Iowa is right here - ACT even has its headquarters here! In other words, education is a pretty important topic around here.

No reason to get complacent about these ACT scores though. Looking at Iowa as a whole, 70% of students still didn't manage to meet all four benchmarks for college readiness as required by ACT. Although that's still better than the rest of the country, nationally the number of students not meeting all four benchmarks was 77%. This might be a good place to mention that the the subjects tested in separate exams are English, Reading, Math and Science.

On the up side, more students in Iowa are concentrating on the core subjects, with 78% of students taking at least 3 years of math, science, social studies and 4 years of English, in comparison to 69% last year. That number is likely to get even better in the next couple of years as more students concentrate on the core subjects. Starting in 2011 the model of 3 years of math, science and social studies and 4 years of English will be a requirement for all graduating students.

The Department of Education Director Judy Jeffrey commented on the importance of measuring the education system by the outcome it produces and pointed out that Iowa continues to lead the nation in graduation rates, ACT scores and SAT scores.

If you're moving to Iowa that's got to make you feel pretty confident about your child's education... And looking at both public high schools in Iowa City with their ACT scores for 2009 quite a bit higher than the state average you can feel even better!

Iowa City Real Estate: Selling Your Home in a Tough Market

When times are tough it's time to get back to basics. There are no secrets. There are three basic factors to consider when it comes to selling a home in Iowa City or anywhere else for that matter.

Condition of a home

Price of the home

Location

Let's start with condition: the condition of your home has never been more important than it is in the current market. The Iowa City market may be stable compared to other areas, but buyers are are still VERY picky in this market, so to get their attention you want to make sure your house"stands out from the crowd".

How do you do that? The easiest way is for you start thinking like a buyer. Pretty soon you'll be in the market to buy a new home. Go to some open houses and figure out what's important to you when you buy a home. Chances are you're on the same page as most other buyers out there... That's when you go back to your own home and start preparing your home for future open houses. Keep in mind my comment about buyers being picky... To sell your home in this market it doesn't need to look good - it needs to look GREAT!

If you think your home may need more than a little TLC before you put it on the market it might be a good time for us to talk. You want to be careful with those upgrades.You don't want to do anything that has little or no return on investment. When it comes to selling your home, some updates make sense, others don't. I can help you decide which ones should take priority.You want your home to appeal to as many potential buyers as possible, but there's no reason to be over the top about it. I subscribe to the "keeping it real" principle of doing what's reasonable before putting a house on the market. And actually that's a principle I subscribe to in any market, but perhaps more so in this one where the bottom line is on everyone's minds.

So now let's move onto pricing your home: This is something that's not exactly easy to do on your own and a very good reason to work with an agent. Figuring out the market is something we are good at. It's not just a question of finding out what homes sold in your neighborhood through some online resource. That would be too easy. When I prepare a Comparative Market Analysis (CMA) I do an in depth analysis of what's currently on the market, how many homes are pending sale and how they all relate to your specific property. I'm all about pricing a home based on data and use all the tools as my disposal to figure out the right price to list a home at. I will advise you on EXACTLY what's going on in your market and make you aware of what the competition is doing. Working with the data, we'll be able to price your home in such a way that it attracts maximum attention with the potential for the most showings.

Pricing your home right is key to attracting buyers to come look at your home. It's widely accepted that homes sell closer to their asking price within the first 45 days on the market. After that all bets are off. This is not the market to "test" a higher price. If you price your home in line with market conditions you can expect buyers to come see it and it will only be a matter of time before the right one walks through the door and makes an offer. Not really rocket science at all. Just a good game plan!

Now all we're left with is the question of location as a factor when it comes to selling your home. Everyone's heard of the term that selling real estate is all about location, location, location. Well, if may not be quite as true as it was once, but it is still a very important factor for almost all buyers.

What have you got that puts your home in a location potential buyers want to be? It's not a factor you can change, so you work with what you've got. What makes the location of your home a good place to move to? There is probably a reason why you moved there...Is it close to the elementary school? shopping? work? Your agent will ask you these questions, (and probably have some of the answers too).

Going back to price briefly, where your home is will also contribute to the analysis when it comes to setting a price. In Iowa City for instance, if your home is within walking distance of either the UIOWA or the UI Hospitals then yours is going to be a pretty popular house! Popular neighborhoods translates into higher prices, that's the way it works.

That about sums it up. When you have these 3 things covered you will be well on your way to selling your home. Some of the information in this post is specific to the Iowa City real estate market, but the three basic factors to consider when your selling your home probably apply to just about anywhere in the country.

Of course there is still the secret ingredient of a good marketing plan...There would be no point in all this preparation if buyers didn't know your home was on the market, would there?

That's the part where you step back and let me do my job. No worries, we're well-prepared, so you can just relax and wait for the showings to start...

Iowa City: More than you expect in the Midwest

Iowa City is a surprising town...This comes from someone who's visited many towns and cities on three different continents, so I figure that makes me something of an authority on the subject!

I relocated to Iowa City ten years ago and had no idea what to expect. What do you think of when you think of Iowa? I thought of the Gilbert Grape movie and corn fields and that was about it…

It didn't take me long to realize that I was way off base and there's a lot more to Iowa City than that...Of course Iowa City is a college town, so it has the college town atmosphere. The University of Iowa as the largest employer in the area has an enormous influence on the Iowa City way of life. The University is probably the main reason why Iowa City has such a diverse community with so many people from so many different cultures. It’s this diversity that makes Iowa City unique in so many ways.

What impresses me most about Iowa City? I'm going to start by talking about the Arts. It only took a walk through the Ped Mall for me to get a sense of how Art and Culture influence day to day life in Iowa City. Book shops, Theatres, Museums, Art Galleries, oh, and Coffee Shops…Such a small town and so much to offer!

A walk through the Ped Mall is interesting any day of the week, it's even more enjoyable when there's live music and that happens a lot throughout the summer months. Summer this year has been a bit on the wet side to say the least, but that hasn’t stopped Iowa City celebrating the Summer of the Arts / Jazz Festival.

Although Summer of the Arts is not over yet I want to move onto what for me is the highlight of the events taking place this month. It’s the Landlocked Film Festival and runs from August 27 to August 30. It’s a collection of independent films that are screened at different locations in the downtown area.

International Independent Films in Iowa City – Are you impressed? As an independent film lover I am...It ranks up there with the time I saw Richard Thompson performing at a concert at the Ped Mall a couple of years ago...

Midwest – Boring? Think again! Come visit us. Iowa City will surprise you! And when you're here, make your first stop is one of the coffee shops at the Ped Mall...Then you'll know what I'm talking about!

Many thanks to my friend Howard Horan for the use of the photos: HHoran Studio, Iowa City Tel: 319-351-2813