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Redmond kirkland hbc 9.11.12
 

Redmond kirkland hbc 9.11.12

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  • Doug: Courtney and I update this slide to reflect the agent who is presenting and their team.
  • Chart:http://www.mortgagenewsdaily.com/mortgage_rates/charts.aspPrediction:http://www.bankrate.com/finance/mortgages/mortgage-rate-trend-index.aspx
  • Address in here how your agent fights for you in negotiations
  • Address in here how your agent fights for you in negotiations
  • Address in here how your agent fights for you in negotiations

Redmond kirkland hbc 9.11.12 Redmond kirkland hbc 9.11.12 Presentation Transcript

  • Redfin’s Home Buying Class September 11, 2012 Bellevue, WASlide 1 of 60
  • Agenda Considering… ● To buy or not to buy ● Market conditions ● Searching for a home Looking… ● Finding a real estate agent ● Working with Redfin Break! Buying… ● Mortgages ● The offer and the deal ● Short sales and bank ownedSlide 2 of 60
  • A Little Bit About Who We Are Redfin is a real estate brokerage that has helped over 20,000 people buy or sell a home; 97% would refer us to a friend. ● Customers, not commissions ● Informed decisions ● The right home for the right price  No obligation  Get back a portion of our commissionSlide 3 of 60
  • To Buy or Not to BuySlide 4 of 60
  • Why You Should Buy a Home ● You have a family and need room to grow ● You expect to stay put for 5 or more years ● You want a home that is difficult to rent ● You’re handy & and ready to invest ● You’ve saved up a down paymentSlide 5 of 60
  • Why You Shouldn’t Buy a Home ● You don’t have a good reason like family or schools ● You can’t afford the down payment ● You can rent for much less ● You plan on moving soon ● You’re worried about job securitySlide 6 of 60
  • Market ConditionsSlide 7 of 60
  • Case-Shiller: Seattle Area v. 20-City 250.00 20-City Composite Seattle 200.00 150.00 100.00 50.00 0.00Slide 8 of 60
  • Case-Shiller – By the Numbers Seattle Area Up 1.8% year-over-year Peak was July 2007 Down 27.3% from peak Currently at December 2004 prices 20-City Composite Up 0.5% year-over-year Peak was July 2006 Down 31.1% from peak Currently at July 2003 pricesSlide 9 of 60
  • # Homes for Sale – August 2012 City Compared to Compared to July 2012 August 2011 Seattle -8.8% -44.9% Bellevue -2.9% -46.2% Federal Way -9.6% -52.1% Issaquah -14.5% -38.6% Kent -8.8% -45.8% Kirkland -3.4% -48.1% Renton -12.1% -51.9% Shoreline -10.1% -41.9% Redmond +1.6% -55.4%Slide 10 of 60
  • # of Sales – August 2012 City Compared to Compared to July 2012 August 2011 Seattle +5.6% +16.4% Bellevue +6.5% +9.6% Federal Way -23.4% +1.2% Issaquah +41.3% +76.7% Kent -10.5% +1.6% Kirkland -9.9% +3.6% Renton +7.1% +23.9% Shoreline +14.1% +15.9% Redmond +20% -1.2%Slide 11 of 60
  • Price Changes – August 2012 Median Sold Median Listed Median Sold Median Sold City Price August Price August $/SqFt Change $/SqFt Change 2012 2012 since July 2012 since Aug 2011 Seattle $375,000 $400,000 +0.0% +6% Bellevue $500,000 $680,000 -1.5% +11.1% Federal Way $185,000 $250,000 +8.7% +13% Issaquah $397,000 $360,000 +2.5% +10.4% Kent $215,000 $275,000 +7.2% +7.8% Kirkland $400,000 $539,000 +4.6% +7.5% Renton $281,000 $279,000 -2.7% +3.6% Shoreline $260,000 $360,000 -2.9% +1.8% Redmond $432,000 $550,000 +0.0% +1.9%Slide 12 of 60
  • Where is the Market Headed? ● Supply of homes is at a five-year low and won’t increase much more this year. ● Foreclosures have been driving price declines, and years of inventory remain. Investment groups might have impact. ● Rents have been rising, making buying more attractive. ● Market stabilizing, though likely 2-3 years before significant appreciation. ● Rate increases - biggest issue for buyersSlide 17 of 60
  • Searching for a HomeSlide 18 of 60
  • Benefits of a MLS Powered Site ● All the homes for sale: 30% more listings ● You see what the agent sees: 4x the data ● Real-time market data: photos, details of just-sold homesSlide 19 of 60
  • Live Demo of Redfin’s SiteSlide 20 of 60
  • Finding an AgentSlide 21 of 60
  • What to Ask Any Agent ● Is this your full-time job? ● Familiar with foreclosures or short-sales? ● Where were your last five deals? ● Who else will be working with me? ● Will you show me all properties for sale? ● When am I committed to working with you? ● Has a client ever filed a complaint? ● How are you paid?Slide 22 of 60
  • Make Sure He’s a Good Fit Click here when you decide See all deals & reviewsSlide 24 of 60
  • Working with RedfinSlide 25 of 60
  • How Our Team Works AGENT Responsible for your success Writes your offer Handles negotiations YOU FIELD AGENT COORDINATOR Takes you to see homes Schedules tours See 50+ homes a week Prepares paperwork Works with escrowConsidering… Looking… Buying…Slide 26 of 60
  • Slide 27 of 60
  • Now You are Ready to Tour ● Up to six homes per tour in two hour blocks ● Go on as many tours as you need ● Led by field agent ● No obligationSlide 28 of 60
  • We Share Our Commission With You • Applied to closing costs • Refund is tax-freeSlide 29 of 60
  • Slide 30 of 60
  • Redfin’s Partner Program Partner agents are employed by other brokerages, but have teamed up with us to provide Redfin- Certified service to a wider range of customers We’ll refer you to a partner agent when: ► A home is outside of our direct service area ► A home is below our price minimum ► We’re experiencing an unusually high customer demand We survey all partner agent clients ► All surveys are published on their Redfin page ► 97% of customers would recommend Redfin partnersSlide 31 of 60
  • We List Homes, Too! ● More People See your Home ► Premium placement on Redfin.com ► Mobile apps target on-the-go buyers ► Professional Flyers ● You’ll Know It All at Every Step ► Email all buyers who see your home ► See how many people have viewed your home ► Advise you at every step in the process ● Agent’s are Paid on Satisfaction ► Honest Agents ► No pressure advice ► Time spent serving YOU!Slide 32 of 60
  • Break!Slide 33 of 60
  • MortgagesSlide 34 of 60
  • Getting Pre-Approved A pre-approval letter is a letter from a bank or a lender estimating how much theyll lend you ● Establishes what you can afford & makes offer process go faster ● Good for 90 days, depending on lender ● Ask for a few different amounts ● Redfin asks that you get pre-approved before your third tour ● Similar, yet different from pre-qualification Information needed: ● W-2, two pay-stubs, tax returns, bank statementsSlide 35 of 60
  • Organize Your Assets ● Get ready for the down payment ● Cash accounts (liquid funds) ● 401k, stocks, other investments ● Gift funds? (max. allowed varies) ● Move funds around earlySlide 36 of 60
  • Review Your Debt ● Pull credit report, look for errors ● Figure out how much monthly income goes towards debt: 28 – 33% healthy ● Pay down credit balances to 1/3rd ● Don’t open any new lines of credit ● Don’t buy any big ticket items ● Co-borrower will need to do the sameSlide 37 of 60
  • Start Shopping for Lenders Compile a list of 3-4 lenders & brokers Good sources include: ● Redfins partner lenders ● Referrals from friends, family & co-workers ● Banks or credit unions you have accounts at ● A large, national bank with an advertised rate ● Your real estate agent ● Online review sites, such as YelpSlide 38 of 60
  • Local Recommended Lenders *In no way does Redfin benefit financially from recommending lenders – we just think they’re great lenders!Slide 39 of 60
  • Current Average Rates Type of Loan August 30, 2012 September 6, 2012 30-Year Fixed 3.59% 3.55% 15-Year Fixed 2.86% 2.86% 5/1 ARM 2.78% 2.75% 1-Year ARM 2.63% 2.61%Slide 40 of 60
  • Comparing Loan Estimates ● Gather loan estimates ► A minimum of three, more is better ► These aren’t final numbers, but within a few thousand dollars ► Compare similar loans  Program (FHA, conventional)  Timeframe (same day) ● Compare costs side-by-side ► Discount & origination points ► Interest rates ► Insurance premiums (FHA, PMI) ► APR (interest rates + fees + points + PMI)Slide 42 of 60
  • Make Your Decision ● When possible, get a loan commitment ● Make alternative funds liquid (401k, stock) Good news! Loan payments are made in arrears, so your first loan payment won’t be for two months.Slide 43 of 60
  • Making Your OfferSlide 44 of 60
  • Multiple Offer Situations Tips for Winning in a Bidding War 1. Just Win, Baby!! – Simply have the best offer. 1. Cash is King. 2. Escalate your price? Know your limits. 3. Tighten your timelines. 4. Remove some contingencies? 2. Get pre-approved with a local lender & underwriter. 3. What’s important to the seller? 4. Write a letter & appeal to the seller.Slide 45 of 60
  • Overview of a Purchase •Search homes online & tour •Get pre-approved •Find a dream home Finding •Consult with agent, write offer Your Home •Submit offer to listing agent •Negotiations •Success! •Earnest money (within 3 days) •Inspection contingency (5-10 days) Mutual •Title review (5 days) Acceptance •Financing contingency (25-30 days) •Waiting for underwriting approval •Escrow signing appointment Closing! •Receive Redfin refund closing credit •Get keys and take possession! •Complete Redfin SurveySlide 46 of 60
  • Overview of a Purchase •Search homes online & tour •Get pre-approved •Find a dream home Finding •Consult with agent, write offer Your Home •Submit offer to listing agent •Negotiations •Success! •Earnest money (within 3 days) •Inspection contingency (5-10 days) Mutual •Title review (5 days) Acceptance •Financing contingency (25-30 days) •Waiting for underwriting approval •Escrow signing appointment Closing! •Receive Redfin refund closing credit •Get keys and take possession! •Complete Redfin SurveySlide 47 of 60
  • Overview of a Purchase •Search homes online & tour •Get pre-approved •Find a dream home Finding •Consult with agent, write offer Your Home •Submit offer to listing agent •Negotiations •Success! •Earnest money (within 3 days) •Inspection contingency (5-10 days) Mutual •Title review (5 days) Acceptance •Financing contingency (25-30 days) •Waiting for underwriting approval •Escrow signing appointment Closing! •Receive Redfin refund closing credit •Get keys and take possession! •Complete Redfin SurveySlide 48 of 60
  • Deal Room Important milestone tracker Your to do list Your team of agentsSlide 49 of 60
  • Home Inspection Hints Watch out for: Look for and Check: •Galvanized steel pipes •Chimney sweep fireplace •Double-paned windows •Knob and tube wiring inspection •Well ventilated attic •Check all included •Stairs have handrails •Mold, mildew or signs of appliances leaking near walls or floors •Check water pressureSlide 50 of 60
  • SampleHUDA form that your lenderis required to provideto you one day beforeclosing. It lists the finalclosing costs and feesfor your loan.By law, the final costslisted on your HUD-1must be within 10% ofthe estimates providedon your Good FaithEstimate (GFE).Slide 51 of 60
  • Short-Sales & Bank OwnedSlide 52 of 60
  • What is a Short Sale? The owner owes more on the mortgage than the home is worth ● Usually pre-foreclosure, but not always ● Listed for less than what’s owed to the bank ● Requires 1 - 2 banks’ approval (usually 2) ● May have other liens (taxes, utilities, HOA)Slide 53 of 60
  • We Can Help With A Short Sale ● See short sales with a Redfin agent ● If you want to buy, work with a Redfin agent or a short sale partner agent ● Redfin partner agents work for other brokerages but share Redfin’s commitment to customer service ● Get a 15% commission refundSlide 54 of 60
  • What is a Bank-Owned Property? A foreclosed home owned by a bank or lender Standard sale but: ● Verbal negotiations ● Long response times ● Repairs unlikely ● Legal addenda may require an attorney ● Limited or no disclosures ● Banks demand use of their own contracts ● Bank can back out any time until they’ve signed ● Contract often requires early release of earnest moneySlide 55 of 60
  • So… Where’s the Best Deal? ● Sellers who own their home outright ● Sellers who are relocating ● Estate Sales ● REO & Short Sales if “Best Deal” means lowest priceSlide 56 of 60
  • Key TakeawaysSlide 57 of 60
  • So What Now? ● Make sure it’s the right time for you ● Start browsing online ● Check out our Home Buying Guide and Events page ● Find the right agent ● Get pre-approved & look for a lender ● Start seeing homes ● Make an offer & close the dealSlide 58 of 60
  • After Class… Please fill out the survey. We will also you this slide deck. We’d love to get your feedback so we can improve. To get even more info on the home buying process, check out our home buying guide: Redfin.com/home-buying-guideSlide 59 of 60
  • Our next class! Multiple Offer Class September 19, 2012 6:30pm – 8:30pm Bellefield Office Park (Same location) http://www.redfin.com/buy-a-home/classes-and-eventsSlide 60 of 60
  • Thanks for attending!Slide 61 of 60
  • AppendixSlide 62 of 60
  • Appendix ● Important forms/contracts ● Favorite Real Estate ResourcesSlide 63 of 60
  • Home Inspection Hints Watch out for: Look for and Check: •Galvanized steel pipes •Chimney sweep fireplace •Double-paned windows •Knob and tube wiring inspection •Well ventilated attic •Check all included •Stairs have handrails •Mold, mildew or signs of appliances leaking near walls or floors •Check water pressureSlide 64 of 60
  • SampleHUDA form that your lenderis required to provideto you one day beforeclosing. It lists the finalclosing costs and feesfor your loan.By law, the final costslisted on your HUD-1must be within 10% ofthe estimates providedon your Good FaithEstimate (GFE).Slide 65 of 60
  • Some Of Our Favorite Sites ● Seattle Bubble: market analysis ● Curbed Seattle: cool houses ● Urbnlivn: for condo shoppers ● WalkScore: see what’s nearbySlide 66 of 60
  • HUD Settlement Statement
  • Favorite Real Estate Links● Property information ► PropertyShark: Zoning data, title history, permits, neighborhood data; navigation is clunky● Neighborhood information ► WalkScore: Proximity to points of interest ► Trulia Heat Maps: Median prices across a county
  • Favorite Homes For Sale Links ● Redfin: MLS + FSBO + REO, updated every 15 minutes, with DOM, price history, Zestimate ● craigslist: Major FSBO source that Redfin doesn’t have ● HotPads: Foreclosure heat maps ● RealtyTrac: Foreclosure market detail, subscription required for full reports ● Brokerage site of listing agents: more photos of the listing
  • Favorite Data Links ● Case-Schiller Indices: Pricing trends by metropolitan area ● Altos Research: Median price trends and days on market by city, but some complain data is unreliable ● MSN Home Affordability Calculator: Based on your income & credit score ● SmartMoneys Home Buying Worksheet: Similar to the MSN calculator, but requires more info
  • Favorite Mortgage Links ● Bankrate: Many ads, but is great for comparing local lenders ● Zillows Mortgage Marketplace Help Center: Articles mortgage rates, types of mortgages, credit reports, and a series of mortgage calculators ● The Mortgage Professor: Bare bones information on mortgages, definitions of common terms, myriad of mortgage calculators ● HUD FHA page: Most reliable explanation of FHA loans, good site for first-time buyers
  • Favorite Links● Loans for first-time home buyers ► Federal Housing Administration (FHA) ► Fannie Mae and Freddy Mac ► CalHFA: California State agency that helps certain buyers● Government sites ► Federal Trade Commission: Articles & alerts for home- buyers. ► Dept. of Justice: Role of competition in real estate
  • Favorite Links Cont.● Remodeling & renovations ► DoItYourself.com: A few ads, but a useful clearinghouse of information on remodeling ► National Association of Home Builders (NAHB): Articles on remodeling your home, most are good