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Home Warranty

by Lisa Castanet

Have you ever considered whether or not you should purchase a home warranty on a home you live in or own as rental property?

You should consider the amount of reserve savings you have in the bank for the unexpected breakdown of a mechanical system if it cannot be repaired and needs to be replaced.  The air conditioning unit or air handler (or both) can be large ticket items.  In some situations, it is less expensive to replace an appliance than to pay for repair due to the age of the appliance.  This is one of many factors to consider in weighing the merit for a home warranty versus paying out of pocket when repairs are necessary.

Several companies offer home warranties so you can compare plans, pricing and add-on coverage for systems such as pool equipment, washers, dryers, etc.  Home warranty companies may differ on items such as service call charges and terms of the replacement of mechanical system items or appliances.

One of our Lakeland, FL rental properties had a home warranty in place that covered the appliances.  We received a call from the tenant saying the freezer portion of their refrigerator was not cooling properly.  We scheduled a service call and the appliance repair contractor came out to the house.  He discovered they needed to replace a part and would have to order that part.  However, the time frame for ordering, getting the part in stock and being able to schedule another service call was over a week.  The warranty company explained that their appliance repair subcontractors were based out of Tampa and only came to the Lakeland area two days per week.  Needless to say, this was not a convenient time line for the tenants as they had quite a bit of food in the freezer.

Through the owner and the warranty company, we were able to work out a solution that was acceptable for all parties. The warranty company estimated the cost of the part and a dollar value that they offered towards a replacement of the appliance.  We negotiated a settlement amount of almost $500 from the warranty company and the owner ordered a new refrigerator which could be delivered right away.  The owner was satisfied they were getting a new appliance and the settlement amount from the home warranty company in consideration of the lengthy time line and inconvenience to the tenants which offset their out-of-pocket expense.  It was important to the owner that they kept a good tenant in their rental property who appreciated the consideration and found a resolution to the problem quickly.

Remember to consider the various factors when deciding whether to purchase a home warranty for your primary home or rental property.  We hope we have given you some scenarios and possibilities that could occur to think about in making your decision. 

Is the market improving

by Lisa Castanet

In researching the June and July 2013 market statistics, many people are asking us “Is the market improving?”

The market has definitely changed over the past 12 months.  We had been in what is typically called a “buyer’s market” and then in the course of the past 3-6 months we experienced a “balanced market” where the number of inventory of homes for sale versus the number of buyers was in balance.  The continued decline in inventory down to the lowest levels in six years has contributed to the trend of market fluctuation and we now find ourselves in what is traditionally called a “seller’s market”.  In other words, the number of homes available is lower than the number of buyers which favors the sellers.

According to the Florida Association of Realtors market reports with John Tuccillo (chief economist and vice president of industry data); Mr. Tuccillo stated that “For the past 18 months, median prices have improved”.  The data would suggest, according to Mr. Tuccillo, “It is time to encourage potential sellers to test the waters.  Buyers are out there."

I agree with this whole heartedly.  We have noticed in our own experience with listing property recently that the sellers feel more optimistic due to the low inventory levels and an increase in home prices.  Homeowners that may have tried to list their home for sale one or two years ago without success are now feeling that today may be the right time.

An increase in consumer confidence and recent news of interest rates edging up slightly have caused buyers to make a decision to purchase a home today instead of waiting.

So, it would appear that if you have been considering selling your home then now is the best time in recent history to act upon that thought.  We are here ready to help you list your home for sale and place that “SOLD” sign in the yard!  Give us a call today.

For Sale by Owner

by Lisa Castanet

What is your reaction to seeing this sign in someone’s front yard?  “For Sale by Owner”.  Is your reaction positive, negative or just neutral?  If you are a buyer in search of a home to purchase then you must have noticed this sign before.  I would love to hear what impressions you have when you see this sign.

When I see a “For Sale by Owner” sign there are a few things I ponder.  For instance, a public records search would show when the home was purchased. This would also indicate the purchase price. Knowing the market area, we could try to determine what the current value is in comparison to what the owner paid for the home.  If the home value is less than the current mortgage balance then the owner might be trying to sell the home and get as much money out of the sale as possible to pay off the balance.  The owner may think by NOT using a licensed agent or realtor in the transaction that they could save several thousands of commission dollars.

Another possible reason is that they may have had a negative experience working with an agent previously and therefore they just want to try and handle the sale transaction on their own.  This would be unfortunate but is a possibility.  If this is the case, I really wish they could have the opportunity to work with one of the many decent, professional and knowledgeable realtors that exist.

Between 2007 and 2013 our local market (and the real estate industry in general) experienced tremendous changes.  Today more than ever, the general public needs a seasoned professional to help with property sales transactions.  In the past, agents have specialized in certain niches such as working as a buyer’s representative or working as a listing agent.  Other agents say they want nothing to do with listing “short sales” or “bank owned homes”.  These agents may prefer to work with sellers who have equity in their home.  This is referred to as a “traditional or fair market” listing type of sales transaction.  Since 2007,  a real estate agent almost couldn’t help but work in all of these types of transactions.  A real estate agent who has been in business before the 2007 market downturn AND who is still in business today has had to adapt to this volatile market. 

There have been so many additional educational programs and designations that have evolved in real estate to help realtors learn, understand and become a valuable resource of information to their customers.  In our local market alone, we have seen the number of licensed, working real estate agents drop by about 50% from the number of agents working in our market before 2007.  The difficult economy is one reason for the decrease in the number of real estate agents. For example, a real estate agent’s income is paid on a commission base structure.  An agent is not a salaried employee of the company they represent, as some folks may think.  The real estate agent working in today’s market has had to “roll up their sleeves”, get educated about multiple types of transactions, a changing market place and EARN their share of the business by being a knowledgeable resource for the general public in property sales transactions.

Realtors (who are licensed agents and members of the National, Florida and local association of Realtors) have worked hard for the opportunity to serve our community.  We know the marketplace and how homeowners have been affected by the fluctuation in property values.  We understand that distressed sale transactions (also referred to as "short sales" and REO or "bank owned homes") have negatively affected our local market and many areas of our country.

In closing, I would simply say to Mr., Mrs. or Ms.  “For Sale by Owner” we are here if you need us and would be happy to help you in today’s complicated real estate marketplace.

Displaying blog entries 1-3 of 3

Contact Information

Photo of Native Palm Team Real Estate
Native Palm Team
Native Palm Properties
5925 Imperial Pkwy, Suite #111
Mulberry FL 33860
(863)647-1679
863-838-1318
Fax: (863)701-8309