Archive for the 'Negotiating Contracts' Category
Avoid Problems By Getting Surveyed In Advance
March 16th, 2010 categories: For Sellers, Negotiating Contracts, Video For Sellers
In today’s video blog, I discuss getting your Honolulu home surveyed before you put your home on the market for sale. This may help you to avoid a large number of potential problems that could cost you money or lose you a sale.
If you would like to discuss your real estate needs, feel free to call me at 808-737-2093 or toll free at 877-737-2093. You can email me at keahi@lava.net.
More Video Blogs
Honolulu Real Estate Is A Good Investment
Honolulu Home Median Price of $1,000,000
Honolulu real estate makes a lot of sense over 10 years
Buying more might make your retirement better
Under New Rules-Lenders Even More Important
Sellers Beware Of Company Addenda
| Discussion: No Comments »
Honolulu Trump Tower-Maybe Not! Read The Contract!
July 14th, 2009 categories: For Buyers, Negotiating Contracts, Rants & Riffs
A few years ago when the Trump Tower in Waikiki was being pre-sold, a client called me with an interest buying a unit. I told him I would read the forty-two-page contract and let him know what I thought about the purchase. Here is what I told him. Read the rest of this entry »
| Discussion: 1 Comment »
Honolulu Condos With 70% Or More Owner Occupancy
January 13th, 2009 categories: For Buyers, For Sellers, Negotiating Contracts
Here is a BIG thank you to Tim O’Leary, of Bank of Hawaii, for directing me to Hicondos.com. In yesterday’s blog post, I informed you that lenders are now requiring a owner occupancy of 70% or more, if a buyer is using a down payment in a purchase of less that 20% of the price. As I feared, there are not many Honolulu condos that can meet this level of occupancy. Below are 10 that do meet the guideline.
1001 Wilder-87%
1010 Wilder-95%
1015 Wilder-83%
1133 Waimanu-75%
1350 Ala Moana-89%
Cantebury Place-80%
Courtyards at Punahou-94%
Hawaiki Tower-90%
Oceanside Manor-78%
Queen Victoria Residences-80%
Note that this is not a complete list, but I will post more as I find them. It is interesting that most of these condominiums are in the upper range of value for Honolulu. Call me at 808-737-2093 or toll free at 877-737-2093 to discuss your real estate plan.
| Discussion: No Comments »
Owner Occupancy Requirement UP For Honolulu Condos
January 12th, 2009 categories: For Buyers, For Sellers, Negotiating Contracts
In the good old days of the fast and easy availability of financing, a lender would make a loan on a condominium with an owner occupancy percentage above 50%. Some lenders had a stricter guideline of 55%. With all of the shifts in financing over the last half year, in cases where buyers are using a down payment of less than 20%, lenders are now requiring an owner occupancy percentage of 70%! To find a Honolulu condo with this high of an owner occupancy level is very rare. This new requirement may have the following implications. Read the rest of this entry »
| Discussion: No Comments »
Lessons From A Honolulu Home Sale
October 30th, 2008 categories: For Buyers, For Sellers, Negotiating Contracts
This past September I was hired to sell a home located on Honolulu’s Waialae Nui Ridge (CLICK HERE FOR A CMA). It was a 3 bedroom 3 bathroom split level home that sat on 7,700 square feet of land and showed impeccably. The list price was $1,145,000 and it sold in 5 days for $1,200,000. Note that we had multiple offers and this was an important factor in getting the price to move above full list price. There are many questions that arise from this sale and here are a few of them.
1. September was one of the worst months in economic history, how were we able to sell so quickly and at a price that was higher than the original list price?
2. Isn’t the market “bad” and isn’t it a bad time to sell?
3. Aren’t all of the buyers waiting to see what happens with the economic bailout?
Awesome kitchen!
Here are 5 lessons from this sale.
Lesson 1. I expected the property would sell in the range of $1,100,000 to $1,200,000. I recommended a list price of $1,100,000 and the seller chose to list at $1,145,000. In this market a property has to be priced exactly (if not below) where it is expected to sell. If properly priced, Honolulu homes and condos will sell and they will sell fast.
Lesson 2. Proper pricing took away any buyer’s ability to sit and wait. This property was a good enough value that buyers had to fear losing it if they chose to wait to make an offer. In fact, one of the first buyers to see the property waited a few days and seemed very disappointed to have missed the opportunity.
Lesson 3. By receiving offers immediately, the days on market remained very short. If a property is on the market too long, it is very likely that a seller will receive less money. For some reason to many days on market, allows a buyer to believe that they can offer a lower price. In today’s world, with proper marketing, a seller should receive written offers within 2 to 3 weeks of coming on the market. If activity is low or if no offers are made, then the price is probably too high.
Lesson 4. This home showed very, very well! The owner took the time to organize, de-clutter and have the home cleaned before we began showing. Just like selling a detailed car, a clean and well showing home will garner more interest and money than one that shows up like a fixer upper.
Lesson 5. The six P’s can make you money (Prior-proper-planning-prevents-poor-performance)! By taking the time to prepare the home and properly price, we were able to get sold in a market that some believe to be difficult.
If you would like to discuss selling your Honolulu condo or home, call me at 808-737-2093, as I would love to talk with you.
| Discussion: 1 Comment »
Multiple Offers on Honolulu Real Estate & Options For Handling Them
September 12th, 2008 categories: Negotiating Contracts
I know you must find it shocking for me to discuss multiple offers on Honolulu real estate, as many people assume the market is slow. Believe it or not, I have been having multiple offers on a number of my listings.
So how can one handle more than one offer on a property? To make this simple, let’s first assume that each offer is substantially the same, because if one offer is significantly better the other offers, it may be best to work with the strongest offer. Here are your options.
1. Go back to all parties and tell them that you have multiple offers and that they have until a certain date and time to present their best offer. Once those offers are received, the seller can then pick the best one with which they would like to work.
2. Work with the offers in the order that they were received. Comment, if I represent a seller, I have observed that this is not the best way to get to the best buyer, as you are letting the clock decide who is best to work with. Just because a buyer delivered their offer first, does not mean that they are the best buyer.
3. Issue multiple counter offers. With the proper contractual language, a seller may issue simultaneous counter offers to multiple parties. In the event that more than one counter offer is accepted, then the language should allow the seller to choose the contract they want to work with and cancel the rest.
There are variations of these methodologies, but in general these are your options. When I represent a seller, I find the third option to work the best. It positions a seller to be able to have more than one qualified buyer from which to choose and it enables the seller to create terms and conditions that best meet the seller’s needs.
Today’s picture was taken from the hiking trail behind my house. It is looking over the upper end of Kilauea Avenue, Kahala, the Waialae Golf Course and you can see Blackpoint on the right.
OTHER POSTS WORTH READING!
Loans For College Condos
The Value Of A Realtor
Realtor Code of Ethics
Determining Offering Prices
| Discussion: 2 Comments »
Sell Your Honolulu Home Before Buying Another!
August 25th, 2008 categories: For Sellers, Negotiating Contracts
Sara MacLennan and Sheldon Johnston, real estate agents in Edmonton, recently wrote a great article regarding the problems created by Buyers making offers on their new home before their old home is sold. They say the following.
“In order to get this condition accepted, every other part of your offer needs to be very strong. When we’re representing a seller and we receive a subject to sale offer, we will generally advise our clients to counter strong. The sellers really have nothing to lose, since the likelihood of the deal actually going together is slim to none. So as a buyer, you end up in a weak negotiating position, and will likely have to pay top dollar, with a large deposit and tight time frames on your other conditions – in fact, you could very easily end up paying for an inspection, only to lose the home to another party.”
CLICK HERE TO READ THE ENTIRE POST
I concur with their findings and highly recommend that you get your home sold before you try to buy another.
Today’s picture is another fish that I had a chance to meet on my recent vacation.
| Discussion: No Comments »
The Hard Conversation
August 11th, 2008 categories: For Buyers, For Sellers, Negotiating Contracts
Real estate is a great business. As a Realtor, I have the opportunity to represent people in the sale or purchase of one of their most significant sets. As a result, I am required to have ongoing consulting and advisory conversations concerning various aspects of a transaction. I classify these conversations into 2 groups, easy and hard.
All most anyone can have in the easy conversations. These include things like the following.
1. Congratulations your offer was accepted.
2. Your loan is approved.
3. You received a lower interest rate than we expected.
4. The seller took our price on the offer.
5. The seller agreed to close earlier and this will allow you to move in when you wanted to.
6. The seller agreed to pay $5000 of your closing costs.
7. The buyer is willing to pay full price.
8. The buyer is paying cash.
9. There are a myriad of other “good news” carrying reports.
Examples of hard conversations are as follows:
1. Your will loan was approved, but it’s at a higher rate than you wanted.
2. The buyer will be using a VA loan and this means you will be paying more closing costs.
3. Based on the condominium documents it appears there may be a special assessment made in the near future.
4. The open land next to this home is zoned residential and could be developed into a subdivision at some point in the future.
5. The buyers loan approval was due on Monday and it loan process doesn’t appear to be going well, you may want to consider canceling the sale.
6. We’ve been on the market 30 days and have not had any offers, based on this activity level, it is time to consider reducing the price.
7. If we don’t reduce the price you could end up getting less money six months to a year from now.
While almost any real estate agent can have the easy conversations. It takes an experienced professional to have hard conversations. And now you’re thinking what’s the point?
The point is this. A professional real estate agent is good at both conversations and goes out of their way to make sure that any required hard conversations are handled in a timely manner. A timely manner is key, because the longer a conversation is put off, the greater a potential issue can grow in magnitude. In my experience, many agents “go underground” when it is time to deal with inconvenient things. A professional wants to deliver a clear picture of the situation, possible solutions and potential outcomes of a course of action. Ultimately, the client is the party responsible for making a decision concerning their transaction, but a realtor’s job is to guide the process so the client can make the best decision for himself or herself.
In closing, when interviewing a realtor to represent you, be sure to determine that they were bringing the professionalism necessary to have the easy and, more importantly, hard conversations that will protect your interests.
| Discussion: 1 Comment »
Buying Property Through the Bankruptcy Court
June 19th, 2008 categories: For Buyers, Negotiating Contracts
I have been fortunate to represent a number of U.S. Bankruptcy Trustees in the sale of Honolulu real estate. I find that many people think that the bankruptcy sales process is the same as a foreclosure. In some ways it is similar and in other ways it is totally different. Rather than comparing and contrasting the two processes, I am going to walk you through an outline of the bankruptcy (Chapter 7) sales process.
1. An owner of a property files Chapter 7 Bankruptcy and becomes known as the debtor. This will “stay” creditors from taking action to exercise their rights. Read the rest of this entry »
| Discussion: 3 Comments »
Honolulu’s Twin Brothers of Different Mothers!
June 4th, 2008 categories: For Buyers, For Sellers, Negotiating Contracts
To be politically correct, I need to say “Twin Sisters of Different Fathers.” I know what you’re thinking, where is Keahi going today. During yesterday’s workout, I began pondering the differences between buyers and sellers of real estate and I came to the conclusion that, though they are on opposite sides of the negotiating table, in many ways they are the same. The more I thought, the more I understood that sellers who price their homes to high are like buyers who make “low ball” offers.
Both of them have the following characteristics.
1. They ignore the facts. In most cases, recent comparable sales will set the value of a property within a certain range of value, yet they try to get a price well above or below this range. If gold is generally priced at $800 an ounce, what makes a buyer think they can buy it for $700 an ounce, a seller think that they can sell at $900 an ounce.
2. They ignore professional advice. If a client works with an experienced real estate agent or broker, that professional most likely has many years of experience and has sold hundreds of homes. Yet when a price is suggested, the client ignores that experience and wants to come in with an offer outside the current market. Attorneys have a saying, and I paraphrase, “An attorney that represents themselves has a client for a fool.”
3. They don’t trust their agent. I have seen situations where the agent/client agent client relationship is very adversarial. Both parties seem literally at one another’s throat. I don’t work in abusive relationships, so I haven’t experienced this bizarre happening, but why would the agent and/or client put themselves in that position. A word of advice for both of you, there are too many fish in the ocean to work with someone you don’t trust.
4. They are unrealistic. In any Honolulu real estate market, there is a price range for every property that will be widely supported by the majority of the buying community. If a seller is too far above that price they won’t sell, if a buyer tries to buy too far below that price, they won’t be able to buy. Go back to my previous post on offering prices (both buyers and sellers) and you will have a clear road map to arriving at a fair offering price.
In summary, the market is the market. If you are a buyer and prices are above your budget, than you are not a buyer in that market. If you are a seller and prices are too far below your expect price, than wait and on the next up cycle you might get there. The one difference between these two parties is that the seller can wait, because over time the market most likely will catch up to the desired price. However, by waiting, the buyer will become that much further priced out of the market. As my father says, “Choose wisely!”
Today’s picture is of great vintage home that can be found on Sierra Drive.
| Discussion: No Comments »
; ?>/images/MatoChiclet.gif)
