Good morning everyone! Hope you all are having (or will be having) a wonderful day.
I am admittedly a newbie at the real estate game. So I am hoping some of you seasoned pros can help me move in the right direction. Here is the scenario..
We would like to sell our home in Pompano Beach, FL and buy a distressed home that we could "fix up" to our liking. We have had a few realtors come by and suggest that our home could sell anywhere from $280k (as is) to $320k (new kitchen and baths(2)). The home has a new roof (more on this in a minute), new floors and a new A/C (I'm in Florida, so this is like gold).
The roof was financed through a PACE program. For those who don't know what that is, its basically a private loan, subsidized by the local government and paid back in the form of a tax lien on your non ad valorem taxes. So the loan is not against the individual (me), its against the property, and stays with the property until it is paid off ( so a new owner would need to take that on, but they also get the new roof). I know this wasn't ideal, but it was the only way I could pay for a fairly expensive project, that HAD to get done (old roof was 50 years old). based on the equity I have in my home, I could pay that off if it was a) necessary and b) required by the buyers to make the sale.
In any event, based on the numbers I have about 220k on my mortgage, so I am sitting at a fairly strong position equity wise. Problem is, realtors commissions will eat up 6% ($17k) of that if I have a buying and selling agent. Plus closing costs of around $5K-$8K (think this is close?) And If I have to pay off the PACE loan, thats about $20k. So you can see the equity is getting chipped away here at an alarming rate.
On top of that, we are trying to find a steal for another property. Were looking for a 3+/2+ home in Jupiter, FL that is somewhere around the $200 - $250k range that we could put $100k into and make our "forever home". Which is proving very difficult as well.
My questions to the forum:
1) Is it worth it to have both a buying and selling agent?
2) Should I pay off the PACE loan, or transfer that cost to the new owner? Do i have to disclose it? or is it something the title agency should bring up?
3) Should I sink some more money into the property and update the kitchen and bath to try to get to the $320 value? ( I think I could do this for about $10k-$12k)
4) Does anyone have any good websites for foreclosed homes, auction homes?
5) Does anyone know a good Realtor in Jupiter, FL that sepcializes in Foreclosed, REO or auction homes?
Thanks. Please let me know if you have any more questions. I'll be happy to share more specifics on here or in a private message.
That is a ton of info and if you want to go into greater detail please PM me.
1) Yes if they are competent.
The listing agent needs to pay for photos, videos, aerials, etc. Since Google bought YouTube in 2006 YT has become the second largest search engine in the world so its important to utilize that strength.
Also, get a selling agent that will call neighborhoods, mortgage brokers, title companies, etc.
As much as we are in a digital era phone calls still work extremely well.
There is a company called Cole realty resource that for about $1400 a year can get all the numbers in a neighborhood so your agent and their team can call. (dont worry about the expense your listing agent will pay for this)
You want to call neighborhoods that are more expensive than yours looking for downsizers and less expensive neighborhoods looking for people upgrading.
FB ads work awesome too, its a way to pinpoint specific area searches locally and the tons of people coming from the NE and s. Cali.
You can pay $5 a day and still get amazing results. Just pick an agent that has a mix of traditional methods and is tech savvy.
The listing agent has to work extremely hard and do more than just promote them-self. If they just talk about it being on the MLS or a website that isn't the person for you. Ask about their databases they leverage and ask for at least 2 references that you can talk to.
As far as the realtor bringing the buyer I would always pay them to bring a buyer.
If you have any other questions I wrote a book on how to sell homes in PBC and I can mail you a copy free.
Lots more, but that is the beginning.
2) You definitely should. Deals fall through when people think there is an issue. The proceeds from the sale should look to make that good anyway. I wouldn't think that any title company wants an outstanding loan commitment or any buyer would want that.
To double check contact Rachel Popper in WPB she is a RE attorney and owns a title company. She is extremely experienced in RE transactions.
3) Depends on the rest of the home and current inventory in your neighborhood.
4) There are the usual sites like auction.com, etc. but just go to a PB REIA meeting, make great relationships with REI, attorneys, wholesalers, realtors that focus on REI, etc. and you will start getting deals presented to you and start the process.
5) I definitely do but I would want to have a quick 10 minute meeting to see if it makes sense to work together. If I cant help I will definitely point you in the right direction so you can accomplish your goals.
Hope some of that helps
Have a great day
Here is my opinion on 4 out of the 5. Best of luck to you!
1) Is it worth it to have both a buying and selling agent? I have never paid a buying agent. There fee comes from the sellers funds.
2) Should I pay off the PACE loan, or transfer that cost to the new owner? Do i have to disclose it? or is it something the title agency should bring up? I would pay it off at closing. It is going to come out of your pocket one way or the other.
3) Should I sink some more money into the property and update the kitchen and bath to try to get to the $320 value? ( I think I could do this for about $10k-$12k) If you can get a great return on your investment, go for it. In my experience though, kitchens and bathrooms eat up a lot more money than that to rehab.
4) Does anyone have any good websites for foreclosed homes, auction homes? I have used auction.com and Hudson & Marshall. They are both great.
Thank you both for your replies.
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