Nick Dailey RE/MAX: Northern Kentucky Real Estate - NKY MLS - Short Sale

Access the entire Northern Kentucky MLS with NO REGISTRATION!!

So, I bought a duplex two weeks ago today. It was an REO and had been vacant for the better part of 18 months. Needless to say, it needed some love, but nothing was too serious. I've seen a lot worse. By the time OCWEN finally got around to letting me close, I had the repair list ready and contractors on call. Repairs included: painting entire interior; new carpet; new vinyl in 1 of the bathrooms; replace a few fixtures; new locks; new kitchen counter and sink; minor roof repair to replace some flashing.

• My painter was there on day 1. He's done a few jobs for me in the past. He's not the cheapest, but he's meticulous. Paint was finished by day 4.
• The flooring company (The Flooring Gallery - don't mind pitching them if you need their service) has a rental-friendly berber that they keep in stock, and a very neutral, inexpensive vinyl. The manager met me at the property the Friday before last. This past Thursday they began and all of the carpet was finished by last Friday.
• My GC was able to install the kitchen counter and sink and fix the roof within 10 days of purchase. (Could've been earlier, but he's my cousin and he gave me a bit of a discount if he could push me back a week and finish installing a $30K kitchen. I don't blame him, and the project had the time.)
• I did the fixtures and locks and couple other little touch-ups on Saturday.

RE/MAX corporate and CitiMortage have teamed-up to help expedite the short sale process and provide local homeowners with a "graceful exit" from their mortgage problems. Here's an excerpt from the email:

"Dear Nicholas,

Congratulations! Because of your Short Sale training and expertise, you have been selected to participate in the CitiMortgage ProActive Short Sale program.

The program is designed to assist families facing foreclosure with a viable alternative, and a more "graceful exit" through a Short Sale. In support of this program, the names of three local RE/MAX agents, who have a demonstrated expertise in Short Sales, will be provided to these homeowners. The homeowners may choose to contact one of those agents.

The primary reason you have been selected to participate in this program is your demonstrated commitment to the Short Sale process. You should have either a CDPE designation, SFR certification or Five Star training, along with a proven high level of experience with Short Sale transactions.

CitiMortgage has a dedicated team of agents who work with homeowners and real estate agents to facilitate Short Sale transactions. This team has the right to accept or reject any offers, and will attempt to provide a response to purchase offers within 72 hours of receiving all requested documentation, including a complete and signed offer contract. A sales commission of 6% will be paid for each closing and there are NO referral fees."

Has anyone else been accepted in their area?

For 2 hours this afternoon, I will be presenting on the residential short sale process to approximately 50 of the best RE/MAX agents in the area. Hopefully we have an interactive discussion and can help get to the root of the issues that may have made some previous short sale attempts unsuccessful.

The presentation will have enough "meat" to keep our more experienced agents satisfied, but will also provide those with less experience the opportunity to add another arrow to their quiver.

Topics will include: the PFS program, HAFA, B of A, technology to assist with file management, lender contacts and more!!

What are the differences between condos and single-family homes?

Using appreciation as a measure, condominiums in some areas have been as profitable an investment as single-family homes in the past five years. And in some markets, condos appreciated even more, according to some experts.

While single-family homes have been the preferred investment by homebuyers, changing demographics are helping make condos more popular, especially among single homebuyers, empty nesters and first-time buyers in high-priced markets.

Also, the condominium community has worked hard in the last few years to overcome image problems brought on by homeowners association and developer disputes as well as all too frequent construction-defect litigation.

Should I be looking into condos?

While condos never had the kind of appreciation experienced by single-family homes in the go-go 1980s, most ultimately have not lost value, say some experts. And with high prices in many urban markets and more single homebuyers in the market than ever before, the market for condos is strong.

As with any home purchase, you should do your homework about the neighborhood or development before you buy. In the case of condominiums, it is important to read the past six months of homeowners association minutes to see how effective the board is and to learn about any possibly detracting issues (such as protracted litigation with the developer).

The condominium community has worked hard in the last few years to overcome image problems brought on by disputes and lawsuits. Associations are becoming more sophisticated about property management and taking steps to prevent legal problems and disputes.

Condominiums have held their value as an investment despite economic downturns and problems with some associations. In fact, condos have appreciated more in the past few years than when they first came on the scene in the late 1970s and early 1980s, experts say.

While there are lots of reports about homeowner's association disputes and construction-defect problems, the industry has worked hard to turn its image around. Elected volunteers who serve on association boards are better trained at handling complex budget and legal issues, for example, while many boards go to great lengths to avoid the kind of protracted and expensive litigation that has hurt resale value in the past.

Meanwhile, changing demographics are making condominiums more attractive investments for single homebuyers, empty nesters and first-time buyers in expensive markets.

How do homeowners associations work?

Learn everything you can about the homeowners association before you buy into a development governed by one. The association's financial, political and legal conditions are very important to your investment and quality of life.

When run properly, homeowners associations maintain the common grounds and keep civility in the complex. If you follow the rules, the association should not intrude on your privacy or cost you too much in association dues.

Poorly managed associations can drag down property values and make living there difficult for residents. Start by studying the association’s covenants, codes and restrictions, or CC&Rs, and find out if you can live by them. For example, if the rules prohibit loud music after a certain hour and you like to play your CDs late at night, this may not be the place for you. Don't move in thinking you can get away with violating the rules or change them later because you may find yourself in turmoil with determined neighbors firmly in control of the association board.

Find out all you can about the association's finances. Beyond reviewing the budget, talk to the association treasurer and find out if dues are expected to increase and if any special assessments are planned. Ask if special inspections have revealed problems with roofs or plumbing that may cause a dues hike or special assessment later on.

Call and meet with the association president. If you are the type of person who despises intrusions into your private life and the president seems more interested in gossip about the residents than maintaining the property, this may not be the right condo complex for you.

Speak with residents to get their views on the association's finances, its property manager, how it operates and any politics. Associations are volunteer organizations with elected boards, like a mini-government, so politics can enter the picture and spoil a good thing.

Lastly, take some time to understand how homeowners associations are organized and how they conduct business. Like all real estate investments, the more you know the better off you are.

Is it difficult to project rents on rentals?

If you are buying a rental income property and applying for a loan to do so, the lender will require an area rent survey by a certified appraiser. The amount a landlord can expect to receive in monthly rent largely depends on what the property has rented for in the past, the condition of the building, its location and the current housing market.

Lenders also look at other cash-flow considerations. They want to know if you have enough reserves on hand to cover predictable and unforeseen expenses, such as property insurance, taxes, regular maintenance and repairs.