Category Archive

Condos and Issues Part 2

There was a fire in downtown Lake Oswego’s First Addition in May where the owner, unfortunately, died.  It reminded me of some more things people need to think about when purchasing a condo and what to look for in the CC&R’s and By-Laws of a condominium project.  One question I feel buyers should ask is:  What do the CC&Rs or By-Laws say about the eventuality of a fire?  What amount of fire coverage are owners and the HOA required to have?  Ask for a copy of the HOA Fire Insurance Policy.

For example, in the First Addition Rowhouse, the condo rules state that the owner needs to carry an insurance policy that would replace the interior of the unit in its previous structural condition and that the HOA is required to also carry an insurance policy covering exterior replacement with an inflationary clause.  It has no time-line for rebuilding the structure, however. 

There is a condo I know of that burned in Tigard.  It took years to rebuild.  In the meantime, resale values of each condo were affected and the remaining owners weren’t able to sell.  No one wanted to buy in a project where there was a burned-out unit.  The delay happened because the owners of the burned unit filed a lawsuit against the fire insurance company and it took 3 years to settle.

In another example I know of, there was a dollar amount of coverage that had to be maintained by the HOA, but the By-Laws hadn’t been updated in 20 years and there was no clause to cover inflation nor was there a rebuilding deadline.  At what point did the HOA plan to increase their fire insurance coverage? Keep in mind that you might want to sell your condo, perhaps the neighbors condo burned, you are now sitting and waiting for that to be rebuilt so that you can sell yours.  It would be a good idea if you asked what the time-frame is that a unit must be rebuilt. 

(For more local and national real estate news, click on my monthly newsletter - JUNG’S JOURNAL - on my website www.bettyjung.com).

You are probably assuming all buyers are submitting what we call “low ball offers”.  Well, not in all cases.  However, I have received offers from buyers on my listings recently at $65,000 less than list price, and $54,000 less than list  price.  A month ago I received one at $114,500 less than the asking price.  You’d think that these offers wouldn’t be accepted by the sellers; and, you are correct they weren’t accepted.  However, in 99% of the cases mentioned above, all parties did eventually come to an agreement on a final sales price.  Both the buyers’ agents and myself worked on these transactions quite a bit and all sides did come to an agreement. 

First of all, buyers I think for the most part are assuming that “all” sellers are either anxious or desperate to sell.  That wasn’t the case in the examples shown above.  Buyers seem to ignore what the asking price is, come in and think they can just “steal ” the house.  Those same buyers don’t perhaps understand that the houses are already listed at bargain prices and are good investments for the neighborhoods at their current asking prices.  Many of the homes for sale have already been discounted 5,10, or 15% lower than the market and what other homes are listed at or have sold for and have had multiple price reductions.

When I am representing the seller, as a seller’s agent, my advice to the seller has always been (and still is in this market), don’t be offended when a low offer comes in and I always recommend a counter-offer.  I recently read a really good example.  When you get gas and come to a 4-way stop that has gas stations on every corner, which gas station will you buy from?  Of course, the one that has the cheapest gas is where you will go. I understand buyers are looking for bargains and I can’t blame them.  However, buyers shouldn’t assume that all sellers are desperate and the home they are making an offer on could already be a great value at its current asking price. 

(For more local and national real estate news, click on my monthly newsletter - JUNG’S JOURNAL - on my website www.bettyjung.com).

FHA financing is becoming popular once again with buyers, particularly first-time buyers, due to the new increased loan limit of $417,000 here in Portland, Oregon.

You can borrow up to 97% financing for a purchase and up to 95% for a refinance.  The down payment can be 100% gift and Down Payment Assistance Programs are allowed. A seller can pay up to 6% towards allowable closings costs and/or pre-paids.  There are no reserve requirements and no minimum credit scores.  Make sure you speak to a lender and get pre-approved before you decide to make an offer.  FHA loan amounts vary from state to state, so make sure you check on your particular area and become familiar with the requirements where you live.

Following is a list of the FHA-approved Condominium projects in (MLS 151) Tigard, Oregon. 

FHA APPROVED CONDOMINIUM PROJECTS IN TIGARD, OREGON:

ABC News had a story (CLICK HERE to view) yesterday about how people are moving out of the suburbs and back into the City.  This actually happens each time the economy hits a snag.  I’ve seen it all before.  When the economy is good, people want to live out in the country or suburbs; and likewise, when the economy is bad, everyone wants to move back into the city.  When my clients are looking for a house and want to make a good investment, I always tell them you can’t go wrong if you move along the I-5 corridor or near light-rail.  Some of my clients do take the bus to work and always check out the bus or light-rail routes.  Further, there are shuttle services that take employees to and from their places of work. 

The story focused on California and I can understand why.  Having lived in L.A. it used to take me 1 1/2 hours to drive 10 miles to work and that was 30 years ago.  Now, I understand it takes 2 1/2-3 hours to drive the same distance!  ABC News also mentioned Portland and its light rail and transit system.  Long ago, as a Realtor®, I decided to focus my business on areas closer to my home.  My office is just 3 stoplights from my house and the neighborhoods I focus on are not any further than 15 minutes away from my office and where I live.

Everything is so close, however, here in Oregon.  Nothing is far away.  There is excellent shopping, schools, and restaurants just minutes away.  Freeways are also just a short jaunt from where I live and work.  The coast is a little over an hour away, the mountains about the same drive, the dessert is further - around 3-4 hours and Seattle is also about that same distance. 

I’ve had friends visit who have used our bus and light-rail system and have raved about it.  They were able to see all our sights and areas without using a car. With today’s cost of gas and the likelihood that prices will only increase, no wonder people are moving back to the city.  

(For more local and national real estate news, click on my monthly newsletter - JUNG’S JOURNAL - on my website www.bettyjung.com).

There was a major house fire in one of Portland’s southwest rural areas a short time ago. The story made not only local news but appeared on CNN as well. I saw both news stories. The photo at right from KATU Channel 2 here in Portland shows the devastation.

Thank goodness, the owners weren’t home. Unfortunately, fires happen all the time. Why then did this particular fire make such sensational headlines?

This large older home burned to the ground and couldn’t be saved because the home was in a rural area with no source of water. There were no fire hydrants close by which compounded the difficulty for the firemen. Firefighters had to truck in water and then get refills from fire hydrants blocks away. The photo shows that the fire was quite spectacular and the home wasn’t saved.

When you purchase property in rural areas there is a particular paragraph in our Oregon Real Estate Sales Form - Residential Real Estate Sale Agreement - that states:

“THE PROPERTY DESCRIBED IN THIS INSTRUMENT MAY NOT BE WITHIN A FIRE PROTECTION DISTRICT PROTECTING STRUCTURES“.

It’s on line 209 and on Page 5 of 8 in our Residential Real Estate Agreement. I mention where it is because I know when buyers purchase their “new” home they are so excited they don’t always read the fine print. There are so many things to remember and so many pages to read buyers sometimes forget. Or, perhaps they think it won’t ever happen to them.

Buying rural property seems to be most everyone’s dream. That 1/2 acre or acre parcel in the country to stretch out on seems to lure people. Be aware that there are always different things to check out before buying different types of properties.

When buying acreage, assuming there’s a home on the land, some questions that should be asked are: is there a well, how deep is the well, what is the well’s GPM, how large is the pump, where is the septic located, how large is the septic tank, has the septic been pumped out recently, how many leech lines are there, is there a plot map showing where the leech lines are, have the corners of the property been staked, has there been a survey, what are the zoning restrictions? Have the water tested to determine if it is fit for human consumption (that’s on Line 109 Page 3 of 8), and have the well pump checked, etc. These are just a few things you should be concerned about when purchasing that acre in the country. Oh, and always ask about fire protection!

The “American Dream” has always been about owning a piece of this great land of ours. With the sub-prime mortgage mess, it has become increasingly difficult not only for Americans to buy a home, but for foreign investors as well. Some lenders are reluctant to finance non-resident aliens with common visitor visas and most foreigners do not have enough credit history here in this country. A high percentage (28%) have had to pay cash, while only 8% of American home buyers used cash to purchase.

“When we survey our lives and endeavors we soon observe that almost the whole of our actions and desires are bound up with the existence of other human beings.” - Einstein

We live in a global economy where there are virtually no trade borders. The Internet is accessible from nearly all countries around the world. While U.S. housing markets are no longer performing at record-breaking levels, U.S. real estate is still considered a prime investment opportunity for foreign buyers and a “safe haven” in which to put their money. With the weakened U.S. dollar against foreign currencies, those currencies buy a lot more than in previous years. In addition, we have a large supply of real estate and it is fairly easy for a foreigner to purchase a home in this country. Further, not all countries allow home ownership or have access to credit plus all the other advantages of owning a home as we do in the United States.

FHA financing is becoming popular once again with buyers, particularly first-time buyers, due to the new increased loan limit of $417,000 here in Portland, Oregon.

You can borrow up to 97% financing for a purchase and up to 95% for a refinance.  The down payment can be 100% gift and Down Payment Assistance Programs are allowed. A seller can pay up to 6% towards allowable closings costs and/or pre-paids.  There are no reserve requirements and no minimum credit scores.  Make sure you speak to a lender and get pre-approved before you decide to make an offer.  FHA loan amounts vary from state to state, so make sure you check on your particular area and become familiar with the requirements where you live.

Following is a list of the FHA-approved Condominium projects in (MLS 147) Lake Oswego, Oregon.  Another post will show FHA Approved Condos in Tigard, Oregon.

LAKE OSWEGO, OREGON - FHA-APPROVED CONDOMINIUMS 

My monthly newsletter (Jung’s Journal) to my clients always includes the Inventory of Houses for Sale in Portland, Oregon (the chart below).

This is a simple chart yet very telling. For instance, you can see exactly when our market started slowing down in September 2007. You can also see from this chart when the market was “red hot” during which time houses were selling even before they were listed and with multiple offers in May 2004 and taking on steam in March of 2005.

There are a couple of other things this chart shows you as well. It shows when the best times to sell were and again that time period was from March 2005 - June 2006, when the inventory was at its lowest.

Likewise, the best time to buy a house is when the inventory levels are at their highest, which is right now.

INVENTORY OF HOUSES FOR SALE IN PORTLAND, OREGON

FROM JANUARY 2004 to APRIL 2008

The MLS in the area you live also has these numbers for your market.   The total inventory of houses for sale represents how many months it would take to sell all the houses for sale now if no other houses came up for sale.  Obviously each month’s numbers change depending upon how many sold houses there were and how many new listings came on the market within the past 30 days.

It’s almost impossible to “time” the market because we are always behind a month in our statistics.  For example, our May statistics won’t become available until mid-June, etc. However, your Realtor® can give you the statistics for your real estate market and it should help you to decide when it’s a good time to buy.  Here in Portland, Oregon, the time to buy is definitely now when inventories are at all-time record high levels. 

Nationally, I heard the average # of months it would take to sell all the houses (inventory) throughout the U.S. is now at 11 months.  A balanced market that is good for both buyers and sellers is when the inventory of homes for sale is between 5-6 months.

Interest rates are still low with all indications they will start going up soon.  Now’s the time to buy!

(For more local and national real estate news, click on my monthly newsletter - JUNG’S JOURNAL - on my website www.bettyjung.com).

Following is a list of FHA-approved Condominium projects in Portland, Oregon.  Future posts will show FHA-approved condos in Tigard and Lake Oswego, Oregon.

FHA financing is becoming popular once again with buyers, particularly first-time buyers, due to the new increased loan limit of $417,000 here in Portland, Oregon.

You can borrow up to 97% financing for a purchase and up to 95% for a refinance.  The down payment can be 100% gift and Down Payment Assistance Programs are allowed. A seller can pay up to 6% towards allowable closings costs and/or pre-paids.  There are no reserve requirements and no minimum credit scores.  Make sure you speak to a lender and get pre-approved before you decide to make an offer.  FHA loan amounts vary from state to state, so make sure you check on your particular area and become familiar with the requirements where you live.

FHA APPROVED CONDOS IN PORTLAND, OREGON