Unexpected Consequences - Insurance woes.

Earlier this year, I helped a very nice lady sell her home in Stockbridge.  She had lived there for 20 years.  She was devastated about the sale.  It was a very hard decision for her.  She had taken care of the home, lovingly.  It was in excellent condition.  The reason she sold – she no longer felt safe.  A new “element” had moved into the nearby apartments and into this cute little subdivision.  Now, there were numerous rentals in her sweet little subdivision and she was no longer sure of who belonged or didn’t belong in the subdivision.  She had been broken into twice – horrifying for someone who lives alone.  As anyone would, she placed two insurance claims to cover the damages and the loss of her valuables.

So, we put the home on the market and it sold almost immediately.  It was purchased by an investor; it, too was going to be a rental.  We got through the next few weeks without incident until the day of closing. 

My client had moved out of the home early, even though she had a couple of days after closing to actually move.  She had been moving a little at a time.  The day before closing, she took some things down from the attic and left them on the counter.  They were the last things that she was going to move out on the day of closing.

So, the day of closing, she went to her house for the last time and her key no longer worked. There was a mechanical (non-Realtor) lockbox on the door. The locks had been changed.  She called me in a panic. I immediately called the selling agent to see what she knew about this.  Apparently, the buyer’s staff had mistakenly gone to the house and changed the locks.  But, the most horrifying thing was that her possessions had been taken as well.  She was devastated and in tears. 

When an investor buys a home, they hire people to go in and empty the home - they call this a "trash out".  The good news is that we tracked the workers down and I insisted that they come to closing with her items with an admonition that if anything was missing, we were not going to close.  They came with everything and we closed – end of story, right?

Not so fast.

We started looking for her new house after about a month or so.  We eventually found the cutest home.  She worked with my preferred lender and everything was going along just beautifully.  Until… She started to arrange for her homeowner’s insurance. 

Typically, insurance for such a well-qualified buyer on a purchase price of just over $200,000, should have been between $750 to $1,000.  Imagine her surprise when she couldn’t get insurance from her previous company, nor the next several “big names” she tried.  Imagine her greater surprise when she was quoted $1,800!  Why, because she had had two claims in the same year.  Imagine what this cost would do to a less qualified buyer.  That additional $65 per month could have easily derailed her purchase.

Moral of the story – if you are planning to buy a home and have had recent insurance claims, you may be rendered uninsurable or may have to pay much more than the going rate. This could impact your qualification and force you to buy a smaller home.

To avoid this problem - when you get pre-qualified for your mortgage, don't wait to get a quote on your insurance.  Usually, you only have a set number of days, per your contract, to get full approval for  your mortgage.  Since the amount of your insurance will impact what you are qualified for, you should check on your insurance within your financing contingency period.  

Georgia Association of Realtors(r) Convention - February 2014

I am so fortunate to belong to this trade group.  The Georgia Association of Realtors(r) is the largest trade association in the State. February 3. 2014, was the first day of convention and we were able to go to the Capitol in Georgia to make our voices heard.

This is the Metro South Association of Realtors(r).
I am on the left in fourth row next to railing.
Altogether, there were over 750 Realtors(r).

Did you know that thanks to Realtors(r), the Association was instrumental in having  HB 872 passed that provides a mechanism to track the sale of metals?  The bill provides that if someone sells copper (or other metals) they must either have a license as an HVAC contractor or must show a receipt for a new HVAC system (thus necessitating the disposal of the old system).  There is still more work to do. We are asking our area legislators to fund the bill - we need the budget to have an appropriation for $150,000 to be able to track the sales of these metals.  Stand up and be heard. Let your legislators know this is important.

As homeowners (and owners of more than one rental property), we have had units stolen three times - that's a lot.  Who wants to go through the hastle of having a stolen hvac unit replaced?

As a Realtor(r), I have had my share of stolen pipes and hvac units to deal with on vacant homes that were vandalized.  So, get behind this measure and let your representative know how important it is to fund the bill so it can work as intended.

water heater closet smashed
to find pipes

copper pipes cut off water heater

Wall adjacent to bath damaged to get
a skinny pipe out of the wall

There is another bill coming up relating to solar panels and who has the right to install solar panels and whether someone's desire to install the panels trumps HOA covenants and ownership.  By ownership, I mean, should a tenant have the ability to install panels without the owner's consent.  The way the bill is currently written, it trumps private property rights.

It was a great day and filled with information.

We learned from the Speaker of the House that there were 218,000 jobs created last year in the private sector.  Also, the Port of Savannah will be widened and deepened allowing bigger ships to be serviced at that port.  This will definitely boost the importance of this Port in the South. Stacie Abrahms, the House Minority Leader, stated that we are a "Business Friendly State", but that we Realtors(r) make it a Family Friendly State.

Lastly, we heard from NAR's Chief Economist, Lawrence Yung, that homeownership is at an all time low. We need to get out and educate people as to the benefits of home ownership.  That was echoed by one of our representatives.  In this particular corner of Clayton County, the representative stated that many people don't know the steps to take to buy a home.  Homeownership is important for many reasons.  One fact that Mr. Yung brought out is that the net worth of homeowners vs. renters is approximately $200,000 for homeowners vs $4,000 for renters.

We also learned that of all the real estate transactions done last year (2013), 86% were done by real estate practitioners who are proud to call themselves Realtors(r).  As your South Metro Atlanta Realtor(r), I would be happy to  help you with seller and buyer representation.  Call me, I'm here to help. There are no stupid questions.  If I don't know, I will find out.

Featured Home 4th week of January, 2014 - McDonough, GA Home listed at $1.695 Million.

Wow, I guess in my next life, I can buy this house.

This $1.695 Million home is situated in Henry County's premier Golf Community, Eagles Landing.  The pictures are to die for.  The seller is represented by Atlanta Fine Homes, Sotheby.

As of this writing, it is the most expensive home in Henry County.  If you are interested in seeing this home or others, don't hesitate to contact me to schedule your private showing.

Choose the #1 company in Georgia to represent you when you are ready to buy or sell your Luxury Home. Berkshire Hathaway HomeServices Georgia Properties,

(If the link to the property does not work, that means it is no longer available. Not to fear - I have more.)

Want to search for homes as you drive through Atlanta area neighborhoods?  Download my free mobile app - it searches both MLS and FMLS!

Either 

• text BuySouthSideAtl to 678-400-6100 or 
• go to this link :  http://app.bhhsgeorgia.com/CarlaHaight

Flipping 101, Part 2

In Flipping 101, we were exploring the posibility of buying this little house to flip.

Yes, you guessed it. We are not going to buy this little house.

We could not get the numbers to work. We are just devastated.

Here is the original foot print. This is a modest, 1963 ranch with a carport and an outside entry laundry room, 1000 square feet. We were going to convert the carport to a bedroom and turn the laundry into a bath, adding 200 square feet.

Here are a few Things we did not count on:

• Rewire the house - $4-$5 per square foot - $4,800 to $6,000.
• Install an LVL- that's a beam.
• Plumbing costs- about $5,000

Add that to demolition and framing, about $12,000

That's over $20,000 and now there's

• interior painting
• exterior painting
• kitchen cabinets and counters
• some HVAC work
• bathroom tile work
• some landscaping...

We were going to do some of this ourselves, but there's still cost of materials.

We had a contractor give a preliminary estimate. He  said "Moving Plumbing is easy''. I heard  "Moving Plumbing is cheap''. ..

He gave an initial estimate of $15-18k and that morphed to - mid twenties! Then the final came in at $35,000!

So, we can't buy the house, because as a flip, the numbers don't work. If your going to live there, it would be fabulous. And actually, you may he able to buy it with an FHA 203K (not KS) loan. You can't do the 203ks because there is some structural work and that loan type does not allow for structural.

Moral of the story: insist on full, accurate figures before you buy the house. We had a due diligence period in order to check everything out and, unfortunately, had to terminate the transaction prior to the end of the due diligence because of our budget.

It would have been nice, don't you think?

The measurements are pretty accurate -just trying to give you a quick visual.