Prices in Chester County and nearby parts of Lancaster County have more or less stabilized in the past year.  Morgage interest rates are quite low (5-6%).  If you add this $6,500 tax credit, it makes this a great time to sell your current home and look for a new one.

Heads up: You need to act quickly, because this window of opportunity closes April 30, 2010.  That’s the last day for you to get your new home under binding contract, then you must settle on it by June 30th.

There are certain qualifications you must meet: must have owned your home for at least 5 years, can’t buy new home over $800,000,  income limits, and new home can’t be vacation home, but must be used as primary residence.  Just call or email Laurie at 610-322-5843 or lknecht@comcast.net  if you’d like a Tax Credit Chart mailed or emailed to you with further details.  

 Also contact Laurie if you’d like her to help you get your home on the market as soon as possible so you’ll have plenty of time to find a buyer and your new home before this wonderful window of opportunity closes!

THIS PROPERTY HAS BEEN WINTERIZED

 If you’ve ever viewed a bank owned listing before, a tattered piece of paper bearing this phrase has probably greeted you at the front door.

But what does it mean to you, the prospective buyer?

To boil it down to its most simple form, a winterized property has had all of the water in the home shut off, and then the pipes are bled to remove any remaining water in the pipes. Once this step is completed, the pipes are then filled with anti-freeze.

Why do the banks do this?

Because they aren’t planning to keep the heat on in the property, and they don’t want the pipes to freeze, crack, and burst all over the property which would cause extensive water damage.

Sounds like a good thing right?  Not always.

An improper winterization can cause considerable complications and even severe property damage in some cases.  Why?

Because if the person who performs the winterization doesn’t make sure that every last drop of water is bled from the pipes prior to filling them with anti-freeze, then some water will remain trapped in the pipes. 

The remaining water (even only a very small amount) can then freeze and expand, causing the pipe to break ever so slightly. 

You won’t notice that the pipe isn’t quite right until the anti-freeze is drained and you turn the water back on.

All of a sudden, as you are walking upstairs from the basement of the home that you virtually stole from the bank (suckers!), you notice a hissing sound….

“Do you hear that noise?” you ask your significant other. 

You walk upstairs to the second floor to investigate this Hardy Boy mystery……

…….and much to your dismay you see that one of the bedroom radiators is spraying out water like a inner city fire hydrant cracked open by the neighborhood kids trying to cool off on a 98 degree summer day.

That sucks. 

Winterizations also make it difficult for your home inspector to properly inspect the property. 

The majority of bank owned properties that I’ve dealt with make the buyer responsible for dewinterizing the property at the buyer’s expense before the inspection. 

To make matters worse, they also require the buyer to re-winterize at their expense once the inspection is complete.

The thought process behind this seems to be that if they make the buyer do it, then many times the buyer might just say, “that’s a pain, I won’t worry about inspecting the plumbing.”

Which works well for them, since they are then passing the buck to the buyer who really has no idea if the plumbing is in working order or not.

Need advise on buying a foreclosure, or getting a great deal on a home in Chester County?   Hit me up…… Caleb@kw.com

It’s a bright spring day in Chester County, and my client and I are cruising through a quiet, well kept Thorndale neighborhood on our way to see the REO listing that is priced roughly $100k below the comparable homes around it.  

Sounds good……a little too good.

As we approach the home, it looks like it needs a little TLC, but nothing too major.  “It’s not as bad as I thought it might be,” I remark to my client.  He nods his head in affirmation as we hop out of the car and make our way towards the front door.  I fiddle with the lockbox for a few seconds, manage to extract the key, & then crack open the door.  Immediatley I’m greeted by a pet odor that packs enough punch to make me take a few steps back wards before I can muster up the courage to move forward again.

As we head into the “living room” (I term I use lightly, since any living thing that enters this room certainly won’t stay that way for long), the carpet is matted with massive amounts of thick white fur.  It’s easy to identify the corner of the room in which the poor dog had been trapped, abandoned for who knows how long. 

There are holes kicked into the drywall every few feet, the heater is rusted out, the garage walls have sunlight streaking through them, and the hardwood floors are buckled from an obvious moisture problem coming up from the basement.  As we head up to the second floor, I notice that most of the drywall on the ceiling is riddled with small, roughly-cut holes.  “What do you think that’s all about?” I ask my client. 

“Squirrels…..they somehow made their way into the attic and chewed through the drywall to get into the house.”

Not every foreclosure is a complete rehab.  In fact, I sold one in Valley Township a few months ago that was in move-in condition, and another one in Glenn Mills that needed a little “sugarcoating,” but nothing too major.  But my experience has taught me that if you are looking for a  foreclosure, you better be prepared to roll your sleeves up and get a little dirty.

Be advised that if you are buying a foreclosure, you are buying it “AS IS.”  What does that mean?  It means you can do inspections until you’re blue in the face, but if there is a problem, the bank aint fixin’ it! 

Here are some of the most common issues that I see with bank owned properties that any buyer should be aware of:

1. Watch Out for the Failed Septic System

Any Realtor will tell you that the single most expensive thing that can go wrong during the inspection period is for the septic system to fail.  A new septic can cost anywhere from $7,000-$30,000+ (depending on how quickly, or how slowly the soil on the lot is able to drain water). 

When a home goes through the foreclosure process, often times it lies vacant for several months before it is put on the market.  Many people don’t realize that in order for a septic system to function properly, it needs to be used on a regular basis.  It a home is vacant for more than 1 month, the septic inspection company will recommend that a hydraulic load test should be performed.  This test costs approximately $850, and takes 2 days to complete.  During the hydraulic load test, the system is flooded with massive amounts of water.  The drain field is then probed to see how effectively the system is able to disperse the water.  

If the septic system fails, you can try to negotiate some kind of concessions with the bank, but it is unlikely that they will give in.

Stay tuned for my next Post, “This Property Has Been Winterized”

“Can you show me the foreclosures?”

I can sense the nervous excitement in the air as the words slip through my client’s lips.  Visions of “bagging the big one”…..a 4 bed, 3 bath McMansion in the sought after Downingtown suburb of Chester Springs for mere pennies on the dollar begins to intoxicate the mind like a pitcher full of long island iced tea on a hot summer’s night.  He can almost see it now, the banker falls to his knees  & begins to shake,  clasping at the cuffs of his khakis screaming, “Please, please, take this property off my hands.  It’s yours, I’ll take whatever you wanna’ pay for it.”

It’s no wonder why the public perception is that foreclosures are everywhere, and that they can be had for a mere pittance.  When you watch the news, you see the stock footage of that neighborhood in Phoenix where every home in the develpoment has a For Sale sign up with a little “Foreclosure” rider perched on top.

The other day as I navigated the Rt. 30 Bypass between Exton & Downingtown, I was tuned in to a local sports talk radio show.  As the commercials rolled, I heard one that was so egregious I nearly had to pull over and grab one of those little airline barf bags out of my glove-box and put it to good use. 

The commercial featured 2 young people having a conversation about how the one could possibly have afforded this magnificent home on such a modest income.  Of course, this magnificent home was obtained as a foreclosure that the buyer had purchased for less than they had been paying in rent.  The commercial goes on to give an example of a 4 bed, 2 bath home that is selling for $30,000.  I’m not exactly sure how the rest of the scam goes, but it’s just another example of how the public is being grossly misinformed about the state of the foreclosure market in Chester County today.

As a Buyer Specialist in Chester County, “can you show me foreclosures” is now the question Du Jour.

The answer is YES.  I can show you any foreclosures on the market in Downingtown, West Chester, Coatesville, Exton, Phoenixville, & anywhere else in Chester County.

However, once I help my client’s do a little soul searching, I often find that they don’t fully understand the differences between a foreclosure and any other home on the market. 

To determine whether or not buying a foreclosure makes sense for you, first you’ll need a professional who has experience with this specialized type of transaction.  Someone who can educate you on the way the banks do business and to warn you about the common pittfalls that may be lurking on the horizon.

So stay tuned for more valuable info on how to buy a foreclosure in Chester County, PA

Current Foreclosures in Chester County by Area

Our recent hot real estate market began in 2000. At that time the price of the average home in CASD was $128,021. By 2004 the price of the average home in CASD had risen to $192,373. CASD prices peaked in 2006, when the average home price was $241,102. This was an increase of 88%! CASD includes: City of Coatesville, Boroughs of Modena & South Coatesville, & Townships of East Fallowfield, Sadsbury, Valley, West Caln, West Brandywine and Caln. Each of these localities benefitted from the tremendous price increases.

OK, so what happened in CASD after 2006? In 2007 the price of the average home fell approx. $10,000 to $230,873. In 2008 the average CASD home fell another $10,000. So what does this mean for CASD homeowners who are thinking they would like to sell their homes this year or next? See next week’s blog by Laurie, our Seller Specialist.

When I bought my townhome in Thorndale 2 years ago I got a great deal. At the time that I bought it, it was the lowest sale in the whole development in the past 5 years (of course, it wasn’t in the best shape though). I bought it because it was convenient to the Route 30 bypass, was situated in a cute little Thorndale neighborhood, & was the best thing that I could afford at the time. I got a very good interest rate of 6% and was thrilled to get it.

But the springtime of 2009 is way better…its the Perfect Storm for First Time Buyers. If you haven’t bought a home in the past 3 years the government wants to give you $8,000 to buy one this year……and you never have to pay it back!  Interest rates are below 5% for the first time in over 50 years, and the large number of homes on market give todays Chester County buyer more choices than ever.

Caleb - Your Downingtown, Thorndale, Coatesville, & Phoenixville Home Buying Specialist