Buying A Home in Lincoln, NE – 2018
If you’re looking to buy a home here in Lincoln in the coming months, you probably are already well aware you’re in good company. The market remains hot, with homes in all parts of town in high demand, especially at moderate price points. It does pose a challenge to find the perfect home and then put in the offer quick enough and in the amount that’s accepted, but that’s not to say you can’t find yours now or in the near future.
There are two things to get started that are of great importance – meeting with your lender and securing a real estate agent.
You’ll want to get preapproved before you start shopping for homes, mainly because you need to know what you can afford but also because it allows you to act quickly when you want to put in an offer on a home. Since it’s one of the biggest investments that a person makes in his/her lifetime, there are plenty of other important details to discuss and things to get in place throughout the process too.
“Getting prequalified prior to doing any serious house hunting is a must,” advises Matt Gutschenritter with Cornhusker Bank. “This way you can have the peace of mind that you can afford and be comfortable with the price of the house before even looking at it. I would start this process as soon as you think you might even consider buying a house. The typical documentation that you will need includes two years of tax returns and W2s, copy of a current paystub, and bank, investment and retirement account statements.”
Specifically when it comes to mortgages, since these are typically range from 15-30 years, it’s not only advised to work with a local lender throughout the process of buying the home but also one that services their loans locally.
“I would highly recommend that a buyer/borrower work with a local lender,” notes Gutschenritter. “Working with a local lender who has your best interests at hand is a huge benefit to any buyer. No transaction is the same and there are a lot of moving parts right up until the closing date. It is best to work with someone who is familiar with the local market where he or she works and lives. This is also someone with whom you can physically sit down with and have a face-to-face meeting. Overall, a local lender can simplify the home buying and financing process greatly.
At Cornhusker Bank, most of our new home loans are serviced here in Lincoln, Nebraska. And so, when you eventually have a question on your loan, you can contact someone here locally, as opposed to someone in a Call Center halfway around the world.”
As far as the current climate with respect to interest rates, he also explains, “I think most would agree that we are in a rising interest rate environment. If you are thinking of buying a house in the near future, it would be a good idea to get pre-qualified for financing. And working with Cornhusker Bank, there is no cost or obligation to find out if you can get pre-qualified. You can also set up a plan to either save up for a down payment or clean up some past credit issues.
Finally, while most people are familiar with interest rates being very important, they should also place a lot of attention on closing costs. If one company has slightly lower rates, but substantially higher closing costs, be sure to compare apples to apples. Be sure that you are comfortable with the house payment. It is never fun to buy a new house and yet not be able to enjoy some sort of social life because you have to save up for the next month’s house payment. Also, if you are aware that you may have some kind of upcoming move in the future, typically related to job or family, now may not be the right time to buy a new house. I say that mainly due to the upfront costs that you will encounter as well as the costs of selling sometime down the road.
But overall, in closing, I would say that the home buying process is not as complicated as some would think. Just be sure you’re working with experienced professionals who are there to provide guidance and assist you with the steps you need to take and you’ll be in good hands.”
Also weighing in on the financing aspect of a home purchase, Sandra Larsen with BancWise Realty adds, “The most important factor to consider when getting ready to buy a home is the financing. Buyers put themselves in the most favorable position when they connect with a great local lender who can get them preapproved. To mitigate risk, this is one thing buyers can proactively do ahead of time that will make a big difference.
Most of us are not carrying around $100,000 – $1,000,000 in cash, so taking out a mortgage is the other option. Be prepared to breathe deep and be patient with the process. If you don’t already have a lender selected, seek a reliable, trustworthy referral from your Realtor®. Do be aware that most experienced Realtors® will ask the buyer to obtain preapproval before looking at homes. Here’s why: Let’s say you go shopping for a home and you fall in love…now what? You’ve put yourself on an emotional roller coaster of loving the home but not being able to offer on it because you’re not preapproved and you have a house to sell. Home after home comes on the market and then sells and in the meantime, you tour more homes, fall in love again, it sells and this keeps happening over and over. We as Realtors® care about our clients and this is not something we want you to experience. We want the process to be as smooth and as simple as possible so you’re able to enjoy what is supposed to be a good thing! When done in the right order, it’s super fun and exciting.
It is also better when the loan underwriting process is local, accessible, has reasonable terms, and can adapt quickly, because the federal regulations lenders have to abide by now are very cumbersome and time-consuming. Not to mention funny little unexpected requirements just pop up at the last minute. Be prepared to respond to your lender quickly when they request information. There are many good local lenders, but it’s best to know the person who’s helping you with the most important purchase in your life. Choose to work with someone you’ve met with in person, who can explain all of the different loan products and find one that’s best for you.
Your lender will also probably share with you Rule # 1 once you’re in serious house-buying mode, and especially once you’re under contract to buy a house: ‘Do not use your credit for anything; don’t do anything out of the ordinary financially without talking to me (your lender) first to make sure it won’t affect the loan process. Don’t go buy a new car or new furniture or run up a $7,500 vacation on your Visa. Wait until the house closes.’
Going back to the importance of preapproval, in the current market conditions, most sellers won’t sign off on your offer without it. It’s a reasonable expectation to demonstrate to a seller how you’re going to pay for the home, right? As it stands now, most sellers in this market don’t need to accept an offer that is contingent upon your house selling either. There’s likely another buyer for that home who doesn’t have a house to sell. It’s a seller’s market for the most part in Lincoln these days. Making low-ball offers and asking for closing costs is, most of the time, not the best strategy to get the result you want, which is to buy the home you love. If you love it, other people probably do too. It is competitive out there but now is still a great time to buy a home. Rates continue to stay low and relatively speaking, Lincoln’s home prices are reasonable compared to national averages. Please discuss your particular scenario with a caring and competent Realtor® who can guide you through the entire process. We are here to help you make smart, educated decisions and navigate through inevitable setbacks and any issues that arise. We’ll do it with a calm demeanor and offer sound advice for solving problems along the way.”
She concludes, “A key advantage of trusting a Realtor® when buying a home is simply experience. I am involved in buying and selling homes every day, while most folks will do it two to three times in their entire lives. Every endeavor has a standard process or professional protocol that takes place whether it’s planning a vacation, lighting a stage for a performance, catching a fish, or painting a house. Experienced practitioners in any profession complete the needed tasks to get from Point A to Point B better than one who does not practice that profession daily. Realtors® have had hours and hours of training, practice, and sheer repetition. Your Realtor® has toured hundreds and hundreds of homes in different price ranges and with different condition issues. We’ve processed many, many transactions. We’ve seen what happens when it’s not done right and unfortunately, what the sad consequences are as a result. Ultimately you’ll be so glad you took the step to trust a professional who will be with you from start to finish.”
Further expanding on things to keep in mind when you’re ready to get started, Ben Bleicher with Professional Realty Group of Woods Bros Realty advises, “In order to have the best possible experience, there are a few things worth establishing before you begin to look at homes. First, and most important, talk to your bank. Get pre-approved. This helps to make sure buyers know what they can afford and what the lender will let them borrow. Second, try and come up with a list of needs / wants, areas of town that are of most interest, and specifics like number of bedrooms, bathrooms, style of home, etc. Lastly, begin to look at homes. It’s better to see more than less. This helps mold those needs / wants, which ultimately helps ensure buyers are purchasing the right home. I’ve found that the best first step once I’m involved is to set up buyers in the MLS (Multiple Listing Service). This gives them access to the most accurate and up-to-date information about listings that meet their criteria.
Currently, it’s a seller’s market. With interest rates threatening an increase, plus worries over the current political conditions influencing the market, people are hesitant. The market could easily turn to a buyer’s market, though. Right now I wouldn’t necessarily discourage buyers from jumping in, but rather I’d just advise to keep an eye on things. And just the same as with your lender, work with a reputable and experienced real estate agent. Experienced realtors can make the purchase process much easier. We know paperwork front to back, and have the knowledge to get through the entire process stress free. A good agent should be able to assist the buyer through all phases of the purchase with ease – the purchase agreement, title paperwork, inspections, etc. It is also our job to protect our clients, the buyers. Most experienced realtors have seen enough problem houses to know what major defects look like. Foundation issues, windows, roofs, HVAC, and some other items are typically big things to make sure are OK before moving forward.”
Speaking of which, once you’ve found “the one,” there are a few things left to do before the deal is done. As you may suspect, one of those is the home inspection.
Randy King, an InterNACHI Certified Master Inspector who has inspected over 8,000 homes of all shapes and sizes in southeast Nebraska and who has owned and operated King’s Home Inspections for 19 years, provides the following information to consider:
“One important part of buying a home is having a professional home inspection done prior to purchase. This is usually done as part of the negotiation phase during the purchase process.
Schedule your home inspection as soon as possible after getting your offer accepted; usually home inspectors are in high demand and booked out several weeks.
Most home inspection companies offer something called a “Whole House Inspection,” which is a comprehensive review of all aspects of your home – electrical, plumbing, heating and air conditioning, structural, interior and exterior finish, roofing, grounds and landscaping. These range from $400 to $600 depending on size of house, price, number of furnace and A/C units, etc. And it varies company to company.
A home inspector is a generalist by nature, and a home inspection is a thorough review of all these areas. An inspection can discover defects or issues with a home that the buyer (and many times the seller) is not aware of, and these issues can then be dealt with prior to purchase. Additionally, other inspections such as termite, radon testing, mold, lead paint, or asbestos may be asked for as need arises.
When choosing a home inspector, look for one who has years of experience and credentialing with a national association, such as International Association of Certified Home Inspectors (InterNACHI), American Society of Home Inspectors (ASHI), or National Association of Home Inspectors (NAHI). Also, look at the education and experience of the inspector; if possible select one who is certified or a master inspector (meaning years of education and experience).
Remember, while a home inspection is comprehensive, it is not invasive. This means your inspector will review readily accessible areas of a home, but will not dismantle water pipes to look at the insides, video scope a sewer line, look behind walls, water test a furnace heat exchanger, or any other invasive, exhaustive analysis of parts of the home. Those types of inspections are specialized and far beyond what a home inspector does.
The home inspector often will refer you to a specialist for further evaluation if a component is suspect. You can purchase a home warranty to help cover things that may break or go bad. These are usually for one year and can be renewed. Ask your realtor or representative at your title company for more information on home warranties. On older homes or ones with equipment over 20 years old, it’s often a very wise investment. A home inspection is not a guarantee that nothing will go wrong with your house; that’s why home warranties are a good idea.
Components in a house have a lifespan, and your home inspector can identify age of components and help you formulate a game plan on when to plan to remodel, replace, or upgrade components such as shingles, a water heater, or an HVAC system. This is important, especially if major systems have to be upgraded in the first few years of ownership, as it helps the buyers to know what major expenses they may be facing on a particular house.”
Prior to settling on “the one” and going through the closing items, you’ll likely do your fair share of touring homes on the market and attending open houses.
As for what to keep an eye out for during that process, and other home shopping tips and tricks, Mary McCombs with Essentials Home Care advises, “The thought of buying your dream home is exciting but scary at the time. You’ve made an appointment to see a few homes, but what should you look for during a home tour?
It’s best to come armed with your cell phone or camera to take photos and notes of the features you like and don’t like. Believe me, everything starts to run together. By taking notes and photos you can sit down that evening to review your photos and notes. Rate each home, go back and visit those you have more questions about.
Once inside a home, try everything. Follow common courtesy but don’t be shy—open and shut the cupboards, flush the toilets, and whip out the measuring tape. Here are a few key things to look for on each home tour:
- Number, location, and size of bedrooms
- Number, location, and size of bathrooms
- Closet and storage space
- Number of floors
- Sight lines through home
- General floorplan
- Age and condition of appliances
- Light switches and number of sockets in each room
- Plumbing and water pressure
- Amount of natural light and views, if any
- Noise levels inside and outside the home
- Width and types of stairways
- Porches and decks
- Garage and/or parking capacity
- Proximity to neighboring homes
- Remodeling opportunities
Curb Check – Before ever stepping out of the car, take a few minutes to look at the curb appeal of the home. What are the sidewalks and entrances like? Will the home need to be painted soon or does it have permanent siding or brick façade? Do the roof and windows appear to be in good shape? Will the plantings require lots of maintenance or is there a steep slope that will be difficult to mow or drive up in the winter? Would any necessary changes be easy and affordable?
Sun or Shade – Which way does the house face? Entertaining on the east or north side would be shadier in the summer evenings than those that face west or south. East facing windows allow in morning light while west ones draw in afternoon sunshine.
Focus, Focus, Focus – It is easy to get distracted by how the seller has decorated the home. Paint and wallpaper are relatively inexpensive to change but major construction can be a deal breaker. Is the layout what you had in mind? Are the rooms large enough for your needs? What about closet space? Check out the lighting, is it adequate?
Stair Way to Heaven – Pay attention to stairs. Are the stairs comfortable to go up and down? Is there a rail? Are there any squeaks or do they feel sturdy? Are there any turns or will the width be an issue when moving in furniture?
Time for a fitting – Pull out the tape measure to be sure your furniture will fit. Pieces that look right in one space can appear surprisingly out of place in another.
Quiet Please – Is the home quiet enough? Can you hear people in the other room or outside? Listen for things like traffic, plumbing, and barking dogs.
Look Outside – Walk around the entire property and home. Pay attention to the age and condition of the roof and siding. Does the landscaping look like it will need a lot of work? Do you enjoy gardening? If not, look to see if the yardwork is minimal. Pay attention to the slope of the yard; make sure it slopes away from the house.
School District – Look at the home school rankings. Even if you don’t have kids, it is important to know that homes in good school zones tend to preserve home value better and sell faster. How safe is it for kids to walk to school or will they need to take a bus?
Location, Location, Location – Look at the condition of other homes in the area. You don’t want to buy the most expensive home in the neighborhood. Also consider any potential home’s proximity to your work, the charm of the neighborhood, how the home is situated on the lot, ease of access, noise from neighbors, traffic, and pets, as well as access to parks, shopping, schools, and public.
Privacy – Look out the bedroom window, what do you see? Do you look right into your neighbor’s bathroom? Do you like to entertain outdoors? Is your neighbor close enough that they will be part of the party?
The Neighborhood – It’s often said that you should own the smallest home in the nicest neighborhood that you can afford. You’ll have a great view! Drive around on weekdays and weekends, during the day and in the evening. Are homes in the neighborhood consistent in size and features? Do the neighbors keep the yards clean and tidy, or are there old cars and trash around? Is the neighborhood safe enough for people to walk, run, or bike, and are there children playing in the yards?
Your Agent & You – Don’t be afraid to pick your agent’s brain for any unique qualities or flaws that stand out. Here are some questions to ask your agent:
- What do you like about the home?
- Is the price right for this area?
- How long has this home been on the market?
- How long have the current owners lived in the home?
- How old is the home and why is it for sale?
- Are you aware of any repairs that are needed?
- Can we get a copy of the owner’s utility bills?
- Is there a homeowner’s association fee? How much is it?
Finally, McCombs touches on the importance of routine maintenance, whether it’s once you’ve become a new homeowner or the owner of a new home. “Preventive home maintenance is essential to increasing the value of your dream home. At Essentials we are in the business of keeping our client’s homes in tip-top shape and potentially saving our clients thousands of dollars in costly home repairs.
A home is the one thing in your life that you will spend the most money on as well as the one place where you will spend most of your time. Our preventative maintenance program can help with any issue, from something as small as changing the batteries in your smoke detectors to something as big as finding a reputable contractor to help with some home remodeling. Our technicians are trained and experienced in all aspects of home maintenance and if there is something we cannot fix, we know just the people to call to help you get it fixed at a lower cost than most homeowners would spend.”
Indeed, a real estate agent is your advocate and sounding board, so you should feel comfortable directing any and all of your questions, concerns, and ideas to the one you choose to work with as a buyer or seller. As for buyers, Pat Ohmberger with HOME Real Estate explains, “A home buyer needs a professional realtor who will answer questions as well as ask them, who listens and who provides an unbiased and realistic outlook. It’s important that my clients know what to expect and all of the other things they need to make the best possible decisions.
First, we set an appointment to meet at my office to explain the process of purchasing a home and set expectations. As a buyer’s agent my fiduciary responsibility is to you, the buyer. I provide the buyers with my expertise in taking them through a step-by-step process which will include educating them about the current market, assisting them to determine their purchase power, and negotiating the best offer possible. Communication and collaboration with all aspects of the process are ultimately the key to success.”
She also notes, “My clients are counting on me to offer guidance and solutions that allow them to make wise decisions, which is not something to take lightly. It requires constantly keeping up with the ever-changing market and a number of variables. That’s fortunately a part of my job in which I take great interest. As a national director for the National Association of Realtors, I have been honored to provide input to the Economic Issues and Trends Forum regarding our market conditions. I also consult state legislators and have testified and hearings on issues that affect private property rights. This has exposed me to a lot of valuable learning experiences and interactions.”
Offering a final piece of advice, she states, “Make a plan, be realistic and keep an open mind. Then look to your realtor to help you evaluate your options, be actively involved throughout the process, and negotiate favorable terms.”
It can sure feel like work sometimes to buy or sell a house, but that’s usually nothing compared to the process of moving that ensues afterward. Well, for some, it could even be beforehand to stage the home or if it happens in a way that you’re in between places for a period of time. Anyhow, it’s not something that most look forward to doing, but the reward of relaxing in your brand new home after relocating is complete that is worth the effort put into the packing, storing, hauling, transferring, unpacking, and getting everything situated when all is said and done. We asked Rod Berens with Store It All to provide a few tips on the process of moving from his standpoint, to which he replied, “Purge, purge, purge. Many people keep moving junk until they no longer want to move it anymore. You can sort through your ‘treasures’ months before moving day. Pack up the items you want to save and keep moving boxes in a storage unit where you can sort them by room or area. This will make moving day much easier, quicker, and boxes will end up in the correct rooms. The more organized you are before you move, the easier and quicker you will get to enjoy your new home.
Specific to temporary storage, he advises, “Most people don’t know how big of a storage unit they need. We ask them what they are storing and help them choose a unit. The most common is renting a unit that is too small making it very difficult to get to items in the unit. It is also important to make sure your stored items are insured. We offer insurance for the contents of the unit. Currently, we’re offering ½ month free, a free cylinder lock, and free truck rental, so if you’re going to be moving in the near future you can take full advantage of this promotion.”
In agreement, Lee Saltzgaber with Heartland Moving Company also emphasizes, “Being ready for the move is the most common issue we run into as packing is the most time consuming of the entire transition. So, start packing early. There is always more work than was first anticipated. With packing as well as the actual process of moving, be honest with yourself about how much you want to do yourself and what you want to hire someone to do for you.”
While professionals take great care to ensure nothing is damaged in the process, sometimes we aren’t so fortunate when moving our own personal belongings. Did you know there’s a business here in Lincoln that specializes in repair of damage caused during moving? The Damage Guy to the rescue! The business’s offerings include, but are not limited to, drywall repair, hardwood floor touch-ups, and furniture repair and touch-ups.
When all is said and done, buying a home – whether you’re becoming a homeowner for the first time or purchasing one that you love even more than the last – is an incredibly exciting and proud moment in life. As long as you’ve got great people as part of your team of professionals to guide you through the process, you’re going to be in the home of your dreams before you know it!