How Long And How Much Money Should Due Diligence In North Carolina?

As we enter the spring market the question when i get an offer on one of my listings is the time period for the due diligence period. What is an acceptable timeline? In the past it did not matter as much as most sellers were excited to have an offer on their house. But as the market has shifted to a more balanced approach and showings are up as well as multiple offers; there is becoming a new normal as to what is acceptable for due diligence time and money. Last year I noticed that offers were written with the due diligence period in the Charlotte, NC. area running up to a day or two before closing to maybe a week before closing. But never more than a week before closing. In addition that was with acceptable terms on the closing date being in 30 to 45 days. Now, sellers are asking for that period to be shortened dramatically or they are asking the buyers to put up more money to extend the time. The due diligence period was a time when the seller takes the house off the market so that the buyer can perform their inspections, get the house appraised, and finalize the loan process paperwork. Generally two to three weeks was the timeline to assure that you would not have any issue with closing. If it went beyond that point and the buyer did not terminate the contract; then the seller was entitled to the earnest money in addition to the due diligence fee. Most buyers would offer $100.00 to $200.00 for this convenience and the sellers would accept. Now, i am noticing that sellers are asking for half or most of the earnest money in due diligence fee and the time lien to be shortened.... They argument I hear is that it is a sellers’ market. Well in my professional opinion it is all subject. If I am in a multiple offer situation then putting in more due diligence money and a shorter time will make my offer more attractive to the seller if all of the other terms are equal. but if the house has been on the market for an extended period of time; then putting less money down should be expected (as long as the time line is reasonable). I have been in both sides of this dilemma this year and do not know if there is a concrete answer. What I have concluded form transactions that have closed and not closed is that the seller that asks for more money upfront and a significant shorter timeline are harder to negotiate with on repairs and closing and extensions....generally the buyers are getting frustrated and I have had a couple walk away from deals and lose due diligence money. I have been working on the premise of a couple hundred dollars for due diligence fee and a two to three week window period with a 30 to 45 day close.....I like to think that I can get all the necessary inspections and repairs negotiated out in that time line and have the appraisal back and all the preliminary underwriting done. If not; then i am not doing the buyer or the seller any justice or my job. There are going to be people that disagree with my thinking. But as a Realtor working both sides of the transactions as a listing agent and a buyer's agent....when o get an offer with those time liens in it I feel it is fair and I present my offer with those timelines in it. Ironically, all deals I have negotiated and closed or closing never have asked for any adjustment in the due diligence fee or time period. Dave diCecco Realtor/Broker Coldwell Banker United Cell:704-519-7895 ddicecco@cbunited.com www.davedicecco.com

Should I Rent Or Buy A Home In Charlotte, NC. in 2013?

As we fast approach the spring selling season in Charlotte, NC. One factor and variable that comes up often is should I buy or should I continue to rent in Charlotte, NC. area? It is a good question and one that deserves further discussion. The last couple of years it was a no brainer if you could buy you should purchase a home because rental prices were climbing fast as supply shrunk to levels that could not meet demand....But since home prices are rising as more buyers are out looking and inventory is shrinking; should I still consider buying? Ultimately the decision is yours and one you should not make lightly. For most people and families owning a home is the American dream and one we all strive to reach. Whether owning that home is this year or next or in a few years is only a question you can answer. But if the time is now and you are on the fence whether it is right to buy; let me give you some startling statistics. In Charlotte, NC. the average rent for 2012 was $1065.00 a month for a two bedroom apartment and $965.00 overall. That was an increase of over 4% from 2011 for a rental. Now there are places you can rent less expensive and others that are more expensive to rent.... Consider that you can purchase a home through FHA at 3.5% interest rate on a $220,000 home would be equivalent to an average rent in Charlotte, NC. and that the average sale price of a house in Charlotte, NC is $217,940. And my scenario includes your property taxes and mortgage insurance. Currently according to studies I found and read about rent versus buy in Charlotte, NC. the cost of ownership versus renting it is 38% cheaper to own a home than it is to rent right now..... Historically this is not the case as rentals in a good market are substantially lower than buying. However; in Charlotte over half of all home sales were less expensive than renting. That is an astonishing number and one I witness every day. First time home buyers are shocked at how low their monthly payments are on the homes they are buying and ask themselves all the time; why did I not do this sooner..... Thinking of buying a home in Charlotte, NC. and not sure if it the right move; you will be shocked and surprised at what you can buy in Charlotte for the same as you are paying in rent right now.... Dave diCecco Realtor/Broker Coldwell Banker United Cell:704-519-7895 ddicecco@cbunited.com www.davedicecco.com

Does being In A Flood Zone In Charlotte, NC. Hinder Your Home Sale?

Flood zone maps are sometimes outdated and even at times people start to wonder what FEMA was thinking with some of their flood plains and lines. But in certain parts of the country flooding is unfortunately a natural thing to be concerned about...However; in Charlotte I have not heard of a house that has flooded by natural occurrences. But, there are pockets and neighborhoods in Charlotte, NC. that require flood insurance on homes because there may have been a stream that ran through the back part of the yard years ago that is now dried up or some other natural occurrence. Because what flood mapping does not take into account; unless it has been revised is construction and the changing landscapes of the earth that have occurred. So, you are looking to sell your home and it is in a floodplain that requires flood insurance. Is this going to affect the value you put on the house? Is it going to hinder your chances of selling the house? It might. First, is where it is located in the flood zone is critical. Is it the property that is in the flood zone only or the house in it as well? What flood zone is it in? There are different ratings for the likeliness of it flooding. Have you ever had any issues with water in the home? What about your property? Is it always wet and damp? These are factors and things that can help you sell the house and affect the price you put on the home. I always recommend getting an updated flood map and certification from your insurance company before putting it on the market. This way you can show potential buyers where the house is located in relation to the FEMA flood lines. In addition it shows you have nothing to hide; especially if you have never had an issue with flooding the entire time you lived there. Second, disclose upfront that you are in a flood zone and the premium you pay and have an attachment of the flood map as well. If the house is on a list of potential homes they are considering this may help them look and make a decision on yours.... Third, tell a story about the house and the fact in the X amount of years you lived there you never had any issues come up with flooding (if accurate). Shows where they think the flooding can come from. I had a client that according to the flood map was in a flood zone that required insurance and the "potential flooding area' was his flower bed now. A few pictures and the map helped put buyer’s minds at ease in terms of buying this house..... Charlotte, NC. has areas that might be prone to flooding. I have not come across any yet that have actually flooded or heard of any that have flooded. But still some home owners are required to carry flood insurance and the you can still sell your house in a "flood zone' if you document correctly and explain the situation to potential buyers upfront..... For buyers if the house has never flooded and the chances look so remote; why would you pass up on a home you love and fits your needs and wants for a maybe? Dave diCecco Realtor/Broker Coldwell Banker United ddicecco@cbunited.com Cell:704-519-7895 www.davedicecco.com