What are these Assessments my mortgage broker keeps warning me about?

In the most basic sense, an assessment is a monthly payment that homeowners in a condominium must pay to their association to cover common bills within their building or community.

When buying a condominium or townhome in the Chicago it's always a good idea to know how much your monthly assesment will be and what exactly it covers. Typically, it will cover (at minimum) the common insurance for the building and the water.

The more perks the building offers often times the more the assesment will cost. If it includes an exercise room, pool or tennis courts, for example, then paying a little more might be worth it.  Make sure you ask your agent to find out what is covered under the assesment because you will be paying for it on a monthly basis!

A basic rule of thumb would be the more the assesment is the more you should expect in terms of services.  Sometimes high assessments mean there are a lot of ammenities in the building.  Sometimes it means that there are structural or mechanical issues with the building which are being financed through assessments.

Deb Hutchinson
Deb.Hutchinson@reallivinghelios.com
www.MLSSearchChicago.com
http://www.chicagoagentblog.com/

Do the essentials without going overboard. Don’t attempt big projects yourself unless you do it for a living. Do a good job or don’t do it at all. And remember not to personalize, but keep it appealing to a general crowd.

Tweaking your condo for a quicker sale and substantial offer? What costs can you recoup?

The market experienced in 2004/2005 brought many owners/sellers to remodel their homes to obtain more money with little effort. New developments are popping up daily with once called luxury appliances and finishes, as standard picks.

Which is one reason the share of construction costs recaptured has decreased compared to recent years.

Positively, the decline has slowed. The need to update is of utmost importance now to sell a home. Without the new standards, added with the competition on the market will most likely equal a longer sales cycle and lower offers.

Smaller projects can result in a bigger return. Customizing and personalizing will not only turn away some unparalleled buyers; it may cost more with getting less R.O.I.

Based on the national averages from Remodeling Cost VS Value Report 2007, a major kitchen overhaul may recoup 74.1% on average, while minor kitchen remodeling can recover an average of 83%.

If you have laminate countertops, old appliances, and outdated cabinets, replace the old with new stainless steel, stone, and new cabinet doors and hardware. If you have a bathroom that is outdated, repaint, and retile. If the floors need to be redone, wood is key. Having the right person installing the floors does matter. Keep the property crystal clean and showing like a model. This will enable prospects to imagine living in the space.

Sarah Andersen
sand@reallivinghelios.com
www.magmilecondos.com
http://www.chicagoagentblog.com/
312-285-5374

A mixed-use residential building features nine unique homes designed to combine luxury finishes with a sustainable lifestyle complete with geothermal heating and cooling, solar, a green roof, and more.  The homes at 2800 N Lincoln will be among the first truly sustainable, earth-friendly and energy-efficient residences in Lakeview and Lincoln Park. 

Substantial outdoor space will be augmented by luxury finishes and features that complement the sustainable construction approach without sacrificing brand name fixtures, finishes and amenities that homebuyers expect.  

Pre-construction pricing is now available on two-bedroom, two-bath luxury condominiums and three-bedroom, three-bath duplex penthouses!

For more information contact Kirk!

Kirk Fox
Real Living Helios
773-972-1963
www.myhomegreenhome.com
http://www.chicagoagentblog.com/

When a buyer and seller reach agreement on a home sale, the buyer typically puts a small amount of money into a trust account. 

This up-front deposit is more commonly known as "earnest money".

A sales contract's earnest money requirement will vary from contract to contract.  It can be as high as 10 percent of the purchase price and could be as low as $500; earnest money is a negotiable item between buyers and sellers.

Some factors that can influence earnest money amounts include:

• Market conditions: Stronger markets often call for more earnest money
• Buyer economics: First-time buyers often give less earnest money
• Seller psychology: Skeptical sellers often ask for more earnest money

No matter how large or how small, however, earnest money is supposed to give the seller a sign of good faith that the buyer wants to purchase the home. 

To this end, earnest money can be forfeited if the buyer later "backs out" of the deal, or breaches the terms of the purchase agreement. Breaching, however, is infrequent. 

This is because most purchase contracts are written with buyer-focused "outs" called "contingencies". 

A typical contingency is that the seller must provide a clean title policy to the buyer, or that the buyer must secure financing prior to given date, or that the home must pass a satisfactory inspection.

If any of these contingencies cannot be met, the purchase agreement is voided and earnest money returned to the buyer.

When contingencies are met, however, earnest money becomes a deposit and is applied directly to the buyer's bottom line at settlement.  If the buyer is expected to have $50,0000 for the closing, for example, the true bottom line is $50,000 minus the earnest money deposit.

Earnest money customs vary from state to state, city to city, and even locale to locale.  Be sure to ask your real estate agent and/or real estate attorney for professional counsel before signing purchase contracts. 

The earnest money you save may be your own.

As a real estate investor you should always be prepared to negotiate. A seller will price a home with the assumption that there will be room needed for negotiation, especially in a market like this one. All real estate transactions involve some sort of negotiation. Successful negotiation will result in a win/win situation for both the buyer and the seller.

To be successful at negotiation there are a few things you should know. First, you should know the property you want to purchase. The more you know about your subject the better negotiator you will be. Then you must know your own needs and current situation. Your most important need, however, is to know the seller’s needs. You must discover what the seller wants and why they want or need it.

A diplomatic approach is vital to the success of the negotiation process. Your first goal will be to establish trust and credibility with the other party. The seller will be more forthcoming with information than they might be otherwise. Use the seller’s name over and over if possible to help establish rapport. Pay close attention to the seller’s interests and hobbies, bring them up in conversations. Finally, be an empathetic listener. People feel more comfortable when they know they are being heard.

Diplomacy includes creating a "positive emotional environment" according to real estate guru Carleton Sheets, by praising appealing aspects of the property. Don’t be critical of the property and don’t ever criticize the seller.

The more you learn about the seller’s needs, the more successful you’ll be at negotiating. The terms of negotiation will include price, financing terms, down payment, closing date, monthly payment, personal property.

You should enter a negotiation with and open mind but develop a strategy. A negotiation strategy will help you know when you are progressing toward your goals. Once you’ve established your goals you should determine your BATNA (best alternative to negotiated agreement) or what you will do if your negotiation fails. Finally, once you’ve exhausted all angles you reach your bottom line or your "walk-away position."

Now you are aware of just how flexible you can be and you will need to create a list of nonessential contingencies to be used as negotiation tools. Nonessential contingencies are items you ask for that can be "negotiated away" without changing your position or ultimate goal. When you have these points to offer the seller will concede on a point that is important to you and you can offer a nonessential contingency for an effective negotiation.

An example of nonessential contingencies might be closing costs or new paint. These are things that you don’t mind giving up because it wasn’t originally your goal anyway. Then if you get it, it will be a bonus.

Sheets suggests that you employ diplomacy again at the final negotiating table and re-establish rapport to make the seller aware that this is a friendly transaction. You should reinforce the idea that both you and the seller must work toward a win/win settlement and everyone is satisfied.

Antoinette 'Toi' Rayburn
aray@reallivinghelios.com
www.ToiRayburn.com
http://www.chicagoagentblog.com/
ph: 312-224-9090