by neil kearney | Apr 27, 2007 | For Buyers, For Sellers
– Proposed Boulder County Septic Regulations –
As a Realtor in Boulder County I know that when I show a home to a buyer in the mountains or out on the plains, most likely the house will have an on site waste water system, otherwise known as a septic system. When I write the contract I make sure there 
is specific language that provides for the cleaning and inspection of the septic tank during the inspection period.
Boulder County is getting ready to implement a new regulation regarding septic systems. What is on the table is an inspection/approval process at the county level that would be triggered by a home sale. The regulation may go into effect later this year. I attended a meeting this week outlining the program from two perspectives; the county and a Realtor.
The County’s perspective:
In Boulder County there are 14, 307 septic systems. Of those systems, 9,580 are “approved” systems and 4,727 systems are “unapproved”. The average age of the approved systems is 23 year old and the average age of an unapproved system is 49 years. The average life span of a properly working septic system is 25 years.
The Goal of the Program
- To insure clean water in the Boulder watershed. Contamination from septic systems is a concern because a leaking system can introduce bacteria into ground water, domestic wells and streams.
- Educate homeowners – Many homeowners are not aware of the risks associated with a failing septic system. Out of sight, out of mind. Only when it backs up or when they can smell it do they take action. The county wants to contact and encourage all unapproved systems to get up-to-date.
- Identify unapproved and/or failing systems. The county wants to have all systems “approved” in the next 15 years and figures that most homes will sell during that time.
- Force homeowners to inspect and fix systems at the time of sale. They figure that a transfer in ownership is where the money and motivation to fix are at their peak.
The Realtor Perspective
To me it seems like this is not the best way to accomplish their goals. As I mentioned before, I have never been involved in a transaction involving a septic system that did not involve at least an inspection and a pumping. Most buyers would not accept an “unapproved” or failing system anyway. The county is counting on the average of every family moving every 7 years. It’s true that this is the national average but in the mountains, I submit that this is not the case. Many houses in the mountains are passed down from generation to generation. Many owners in the mountains are through with their move-up cycle. There are not many “starter” homes or neighborhoods in the mountains where the turnover is much less than 7 years.
The proposed regulation will add unneeded bureaucracy and expense to the home buying process. In Jefferson County a similar regulation went into effect in 2004 and Realtors are seeing duplication of multiple inspections (first a seller than a buyer who wants their own inspection).
In my humble opinion I would like to see the county try to start at the oldest systems and work their way forward with an inspection program that will target polluting systems not just the ones who happen to be selling.
For more information go to Boulder County Health’s website .
by neil kearney | Apr 24, 2007 | For Buyers, For Sellers, Real Estate 101
-Multiple Offers-
We are working in a buyers market. The average days-to-offer in our market is around 75 days. It is unusual to have houses go under contract right away. You would think that multiple offers and offers over full price would be non-existent; but they happen. 
When there is a large inventory of houses on the market buyers become very good at spotting a good deal. When after looking at 20 homes, buyers see a new listing that they “know” is a good house for a good price, they tend to jump on it. If they are smart they give a good offer and wrap up the negotiations as quickly as possible. Chances are they are not the only buyers looking in that area and price range. What happens if two buyers decide to write an offer on the same house. Here is some advice from the buyer and seller perspective.
From The Buyers Perspective:
- Check to see if you have competition. Your agent will call the listing agent to announce your intention to write an offer. Make sure you know if you are competing with another buyer. At the same time have the agent ask for the sellers preferred closing date and for any items that will be excluded from the offer. All of the information below assumes that there is another offer.
- Make your decisions quickly. Getting your offer in a day ahead may make a big difference. Ask for a quick acceptance deadline.
- Do your homework: Check comparable sales and decide the maximum price you will be willing to pay. Also, think about how you would feel if you would lose this house over a couple of thousand of dollars.
- Do a thorough walk-through: When you see a house you are interested in, take your time. Check on the condition of the house, what would you need to do to make it yours. Are the systems (furnace, roof, windows) in good condition?
- Prepare a clean offer: Don’t ask for Sellers to pay for appraisal, cleaning, HOA transfer fees etc. When the seller is considering two similar offers, $50 can make a big difference and send a signal that the buyers asking for all of the small stuff will be tougher to work with down the road on inspections etc.
- Have your financing in place and make sure to include a letter from a lender along with the offer. I prefer to see a local lender who can jump in and make the closing work in a difficult situation rather than somebody who is working a toll free line.
- A nice touch is to write a personal letter to the seller explaining who you are and why you love their house. The seller has an emotional attachment to the house and wants to sell to someone who will take care of their house.
- Consider an escalation clause. When the house is a good value and you know there is competition one effective method is to write in an escalation clause. This clause in the contract automatically raises the bid price if another offer beats theirs financially. For instance it could read “the offer price shall be automatically raised to a price $1,000 above any other bonefide offer, the purchase price shall not exceed $xxx,xxx”. This is where the buyer has to know how much they are willing to pay; is it full price or $5,000 over?
From The Sellers Perspective:
- If you are attracting more than one offer it shows that you have taken care of your home and priced it correctly.
- You want to make sure that all interested parties have a chance to submit an offer. Have your agent communicate to each agent who has shown the property recently to gauge interest.
- When reviewing offers look at these main points: net price to you after all closing costs, dates and terms and buyers ability to pay and close.
- Try to read between the lines and get a feel for motivation. A buyer who has been transferred and is living in temporary housing is a stronger candidate than an investor who will not be living in the house.
- Try to tie up some of the loose ends now. Use a counterproposal to change dates and terms. You will never again be in a better negotiating position.
- Choose what feels right and be open with your agent .
- Remember, you have a right to choose what offer you accept but you do not have the right to discriminate against a buyer. Choose an offer based upon what is on the paper.
From The Agents Perspective:
- Make sure the communication lines are open. Get a dialog going with the other agents. If all parties feel informed about the process and situation there will be no hard feelings. If a second offer comes in after the first, it is customary to call the first agent and give them a chance to change their offer.
- If you are in an agency position with your client they will lean heavily on an agents advice. Give them good information and let them choose from the possibilities.
Every situation is different but remember the buyers agent is charged with helping the buyer get the house and the sellers agent or listing agent is charged with getting the best price and terms for their client.
by neil kearney | Apr 12, 2007 | For Buyers, For Sellers
Condition at Closing
or How to Avoid a Mess at Closing
One of the greatest sources of letdown and conflict in a real estate transaction is the condition of the house after the Sellers 
move out. Provisions in the purchase contract allow for the buyer to do a walk through inspection prior to closing. I advise my buyers to do this walkthrough as late as possible so as to see the true condition of the property as it will be left. What to look for in a walkthrough could be its own topic but in summary; we are checking to make sure that the inspection items were completed as agreed upon, the inclusions are still at the house, that there has not been any recent damage to the house and finally to check the cleanliness of the house. The first three items are fairly “cut and dry”, either the refrigerator is in the kitchen or it’s not. I have found that cleanliness is very subjective. What may be very clean to one hurried, harried seller may be “filthy” to the buyer. I try to mitigate this by talking about this subjective divide as we write the agreement and make the language in the contract as plain and literal as possible. Instead of saying carpet cleaning (sellers picture the Bissell in their closet, buyers picture the $500 top of the line pro), I would make it clear that the carpets are to be cleaned by a professional with the receipt provided.
No matter what you try to plan for it is an issue. Sometimes it becomes an outlet for buyer frustration after a particularly tough set of negotiations. Sometimes it is a seller with good intentions but not enough time. Sometimes it is a professional hired who does a less than professional job. All I know is that I have hired cleaners, pitched in with the sellers as we did a last minute shine or have cleaned cupboards and closets myself. Small important details in making the closing day go smoothly and making my clients happy.
So some parting advice:
To Sellers:
- Plan in advance. Closing and moving is a very hectic time and it is not always easy to complete all of those little last minute tasks.
- Bring in help. Hire a cleaning company or better yet family. It is always very hard to go back to the old house to clean while all of your stuff is at the new house.
To Buyers:
- Get it in writing. If you are worried about the condition of the house, set forth your expectations in writing.
- Be realistic. Maybe you have to tidy up a bit when you move in to bring it up to “your” standards. Don’t let it ruin your day.
by neil kearney | Jan 9, 2007 | Statistics
While I’m already into 2007 working and planning toward another successful year helping buyers and sellers, it is very helpful to look back on 2006 to see where we are and where we may be headed.
Before I present some of the stats I have compiled, I’d like to share with you some of the thoughts I have regarding the market that are not necessarily easy to see in the numbers. Here is what I noticed in 2006:
- There were a ton of vacant houses and condos for sale. This is a result of the softer than normal rental market. Many landlords have decided that selling was a better idea than trying to get a tenant only to find that it was a pretty tough year to find a buyer. Especially when the property was not in pristine shape.
Many houses did not sell and were withdrawn from the market after many months of trying. Only well priced homes are selling quickly. Buyers have many homes to see and it is very hard to fool “the market”.
Once a buyer for a house was found the negotiation tended to favor the buyer on inspection issues. There were many new roofs, furnaces, hot water heaters etc. paid for by the seller this year. Many had the attitude of “just let me be done with it”.
Although the statistics show at least some appreciation, many areas have been losing value. This year I represented a Buyer in buying a house for $11,000 less than the Sellers had purchased for 5 years ago!
One of the statistics I love for comparison purposes is “months of inventory”. This statistic relates houses currently on the market to the number sold during the last 12 months. The chart below shows the amount of inventory in months for the different sub-areas in Boulder County. The inventory is derived by dividing the number of current listings by the average number of sales per month during the preceding 12 months. It answers the question, “how long would it take to sell the homes currently on the market?”. The inventory is the greatest in the mountain areas and the lowest in Louisville. Both Erie and the mountain areas showed improvement from December 2005.
Although the figures for the County are similar, in general the inventory is higher for attached dwellings. 
I will continue highlighting year end statistics in the coming days. Stay tuned!
by neil kearney | Nov 6, 2006 | Statistics
Sales figures have been down across Boulder County most of the year as compared with 2004 and 2005. The average drop in the total number of sales for single family homes and attached dwellings in Boulder County has been around 10% per month. The highest variances were 17% drops in closings during July and September.
Days on Market
Other statistics that shows the relative strength of the market are Days to Offer and Days on the Market. This is simply how many days it takes for a listing to sell and close. Days to Offer measures the time it takes to receive and accept an offer. Days on the Market measures the total time from new listing to the closing. Taking the difference of the two measures the average time a seller has to move out while the Buyer does inspections and obtains financing.
From the graph above you can see that the Days to Offer and Days on Market statistics are very similar to the numbers we have been seeing for the past few years. The average time to contract is roughly 75 days with another 25 to 30 days in order to close. A few things to keep in mind when looking at this particular statistic. 1) Not all listings sell. The numbers only reflect those listings that were good enough to attract a buyer. 2) Some listings sell during a second or third listing period. If a listing does not sell within the first couple of months the MLS listing is withdrawn and added again (many times with a new price). This original listing does not show up or add to the listing period shown when it does not sell. Therefore, the numbers shown are unquestionably low. For these reasons this statistic is best used for comparison to past years, not as a prediction of how long a home will take to sell.
