About Pittsburgh's South Side

I've recently been working with several buyers who are purchasing homes in Pittsburgh with an FHA loan, which has resulted in some interesting challenges. An FHA insured loan is a Federal Housing Administration backed mortgage which is provided by FHA-approved lenders. FHA backed loans have the benefit of allowing for lower down payments and have historically allowed lower income Americans to borrow money for the purchase of a home that they may not otherwise be able to afford.

With the tightening of the mortgage market over the last two years FHA backed loans have become very popular, with close 38 percent of all home purchase mortgages, including 60 percent of all African-American and Hispanic home purchases being made using this type of loan in 2010. (Source: www.thetruthaboutmortgage.com)

The two biggest draws of the FHA insured loan is the low down payment, as little as 3.5% down, and the ability to get a loan with a credit score as low as 580 (or 500 if you can put at least 10% down). FHA will also allow up to a 6% seller assist towards closing costs (although this could change soon), as opposed to the 3% maximum of most Conventional loans.

With all those benefits an FHA insured loan is a great option for many buyers, but their are a few pitfalls to be aware of.

FHA loans are not a good option for "fixer-uppers". If the house you are considering has lots of work required you may have a problem using an FHA loan to purchase. FHA appraisers review the condition of the home and detail repairs that must be made to the home prior to closing. These could include items like peeling paint that must be scraped and painted, Cracked windows repaired, gutters repaired, roofs repaired and other similar issues. Even if the buyer was planning to make these updates in the future and/or doesn't mind purchasing the home in as-is condition, FHA won't allow it, the work must be done before settlement. While FHA does have a loan called a 203K loan that will lend money for repairs, these are becoming harder to get and require the buyer to jump through many hoops.

Some homes won't qualify for FHA insured loans. Specifically condos and townhomes need to be on a FHA approved list in order to be eligible for an FHA loan. FHA wants to validate the health of a condo community before they invest in the property.

FHA loans have a higher mortgage insurance premium (MIP). FHA loans requires a 1% MIP paid upfront (this just went up in April 2011) and then a monthly premium as part of your mortgage payment for 5 years or until the loan amortizes to 78% – whichever is longer.

FHA appraisals have very strict guidelines, and once they are completed the value will apply to the home for 6 months, so a low appraisal can sink a sale even if you and the seller agree to a higher price. If an appraiser can't find comps that apply to the home they won't be able to supply a value, this can be particularly true for homes with wells or septic systems when the surrounding homes do not.

With all the benefits of FHA insured loans it is important to realize that not every home can be purchased with one. Be sure to let your real estate agent know upfront if you are using a FHA loan and ask them to advise you of potential FHA issues in houses you are interested in.

Planning to buy or sell a home in Western Pennsylvania? Call Christa Ross from RE/MAX Select Realty, at 724-933-6300 x214 (office) or 724-779-1437 (direct) or visit my website at www.bestpittsburghhomes.com.

New living arrangements offer artists, professionals and entrepreneurs the opportunity to own a space that can serve as both a home and workspace.

With so many people working at home these days it is not surprising that the idea of a live/work property is sparking growing interest. Perhaps because of the high-cost of commuting, a desire to live closer to the action of the city or the search for cost-effective solutions for small businesses, finding a home that can do double duty is an idea whose time has come.

The USA Today recently reported that “in more than two-thirds of the nation's 51 largest cities, the young, college-educated population in the past decade grew twice as fast within 3 miles of the urban center as in the rest of the metropolitan area” It’s not surprising that the same people that are looking for a different lifestyle, have also redefined their living and working arrangements. According to the U.S Census Bureau, the number of Americans working out of their homes increased from about 9.5 million in 1999 to about 11.3 million in 2005.

On the most basic level the idea of live/work homes could be finding a home that has a great office space as well. But who need a space larger than just a home office can find options like two-story properties that let the owner live upstairs and work downstairs, loft-style open floor plans and converted commercial properties with separate entrances.

If the idea appeals to you, here are a few things you should keep in mind.

• Verify zoning restrictions to make sure your use of the property will comply and look into commercial codes that deal with things like ADA compliance, fire protection and parking.
• Check into financing early. While lenders may give you better terms for a place that you plan on making your home as well as your workspace, you should still expect to put at least 20% down for the commercial type loans that are usually the only available financing for these properties.
• While quirky and cozy spaces are part of the benefit of a live/work arrangement it is unlikely that your clients want to feel like they just walked into your bedroom, so be sure that the property you pick has clear boundaries between personal and professional.
• Plan for growth. If you have big plans for the future then choosing a property that can grow with you business will be crucial.
• Be sure to check the condo docs if you are considering a property in a residential building. Some uses may be restricted. Start your search for this type of property in the commercial listings, since it will be less likely that you will be able to re-zone a residential property to allow commercial use. Main street properties with retail on the lower level, and apartments above, offer great conversion opportunities.

Live/Work on Pittsburgh’s South Side

1105 E Carson Street is a perfect live/work property on the South Side. The building has been completely redone and is move-in ready.

The first floor is rented by a design company. Rent from the first floor lowers the monthly cost of owning the building.

The second floor space has wonderful potential as an office, with a beautiful tile reception area, two front offices and a large space with original hardwood floors. This floor also offers a gourmet kitchen and small deck. Many original features have been lovingly restored and confer a cozy and unique feeling to the space. Sound and energy insulation between floors and energy-efficient upgrades keep utility costs, and distractions, to a minimum.

The third floor serves as a living space, with gleaming hardwood floors, a wonderful front living room, two bedrooms plus a small study and two full baths, including a beautifully remodeled master bath. Finally, the crown jewel of the building is on the fourth floor, an amazing rooftop deck with 360 degree view of the city, the perfect place for your own private oasis, a stunning place to entertain guests, clients, or friends, or a great outdoor workspace on sunny days. For more information on 1105 E Carson Street go to http://www.1105ecarson.com.

Looking for a great space in Pittsburgh to live or work? Call Christa Ross at RE/MAX Select Realty, 724-933-6300 x214 or 724-309-1758. Email christa@greenhomespgh.com. http://www.bestpittsburghhomes.com

You have your home on the market, have had a few showings and generally gotten the same feedback each time. What now?

First, you have to decide, can you fix the issue and if you do will it give you a return on your investment that is at least what you put into it?

If the answer is Yes, then do it.

If the answer is No, then you have a decision to make:

Wait until a buyer comes along that doesn't feel the issue is a problem for them (who knows how long that will be)

OR

Lower your price to make your home such a value that a potential buyer will either overlook the issue or feel like at the price you are asking they can make the change themselves in the future.

Believe it or not this isn't one of the more complicated real estate issues, but it is usually such an emotional one that sellers are always looking for a better choice. Sorry, there isn't one.

Planning to sell a home in Pittsburgh, PA? Call me for an evaluation of you home and overview of what I can do to get your home seen and sold. Christa Ross from RE/MAX Select Realty, at 724-933-6300 x214 (office) or 724-779-1437 (direct) or visit my website at www.bestpittsburghhomes.com.

Selling a home in December, January or February in frigid climates can be a tough task with a slowdown in market activity and chilly weather. Typically, buyers searching in the winter months are more serious. And sellers who are motivated to close quickly can make it happen with your help this winter.

Here are a few tips from RE/MAX associates that can help you get your home ready to sell this winter:

1. Let those lights shine. "Turn on all interior lights for a showing – even in closets and utility/mechanical rooms – and make sure all the bulbs are working. Stock up on all the right bulbs for your lamps and fixtures so you can replace burned out bulbs immediately. Also, it's a great idea to keep front exterior lights on even if no showings are scheduled. Open drapes and blinds to let in light and show visitors the view." – Marlene Granacki, RE/MAX Exclusive Properties, Chicago

2. Make entry easy. "Winter showings can get off to an awkward start if prospective buyers arrive with snow or salt on their shoes. Make it easy for buyers to deal with their shoes when they arrive by putting out a nice, festive area rug at the front door so visitors can wipe their feet, and have slippers or disposable booties available. Also, put out a bench, if there's room for one, where visitors can sit and remove their shoes." – Barbara Hibnick, RE/MAX Showcase, Long Grove

3. Keep odors under control. "Homes can be stuffy in winter when windows are rarely opened, and that can allow odors to build up, which is a huge turn-off to buyers. Pet odors can be especially worrisome in winter. Use a room fragrance if needed, but nothing too strong, and clean more often (especially cat litter, which should be changed daily). Consider using an air purifier and adjusting your thermostat so that your furnace fan runs throughout the day to move air through the house and dissipate odors." – Mike Mondello, RE/MAX Team 2000, Orland Park

4. Make it festive. "Appropriate holiday decorations can give your home a cheerful look during the winter months – and even help homes sell, however, don't go to extremes. Small, decorative white lights on trees and bushes are OK through the winter season, but other decorations should be taken down quickly once the holiday passes." – Starr Zook, RE/MAX on Track, Aledo

5. Keep it comfy. Adjust your thermostat so the temperature is warm, but comfortable; you don't want it too hot or cold. "When it comes to keeping heating bills under control, don't use plastic sheeting to insulate your windows. You may save a few hundred dollars on heating costs if you cover the windows with plastic, but it could cost you thousands on the sales price because buyers might believe they will have to replace the windows," Hibnick says.

Buying or Selling a home in the Pittsburgh area? Call Christa Ross from RE/MAX Select Realty, at 724-933-6300 x214 (office) or 724-779-1437 (direct) or visit my website at www.bestpittsburghhomes.com.

© 2010 RE/MAX, LLC. RE/MAX Affiliates may share this article, provided they do not charge for it and this notice is included. All other rights reserved.

Take a look at this great property I have listed. It's perfect for a live/work situation or an investment property. The street level office is already rented and ready for you to start collecting rent. The upstairs is completely rented and it has an awesome roof-top deck with 360 degree view of the city! See more at www.1105ECarson.com.

Buying or Selling a home on the Southside? Call Christa Ross from RE/MAX Select Realty, at 724-933-6300 x214 (office) or 724-779-1437 (direct) or visit my website at www.bestpittsburghhomes.com.