Read the latest newsletter from Berkshire Hathaway HomeServices Rocky Mountain Realtors in Colorado Springs. BHHSRMR keeps you updated on market stats, Downtown news and events, plus helpful homebuyer and home seller tips. In this edition, you’ll find an invite to our Downtown Holiday Party, plus understanding your home warranty.
You’ve probably heard about home warranties, especially if you have recently bought or sold a home. But are you still confused? You’re not alone, and a lot of people don’t really understand the specifics when they purchase a home warranty. The question we get asked all the time: Is A Home Warranty Worth Buying?
First of all, you need to understand the basics of what a home warranty is before deciding whether or not it makes sense for you.
It’s Insurance For Your Home Mechanicals, Appliances, and Amenities That Aren’t Typically Covered By Your Homeowners Insurance. Like any insurance, you are purchasing it “in case” something happens so that your financial risk is reduced. This could be anything from a refrigerator to a hot tub, based on the package that you purchase. Also, keep in mind that the coverage is repair or replace, but there are some catches and each company is different.
It’s A Limited Coverage Time Frame. Typically, you’re paying up front for the coverage, which can vary based on the home warranty company. We usually see the coverage period between 10-14 months, with 12 months (1-year) being the most common for a basic package. Once your term is up, you’ll have the opportunity to renew it again so you’re covered for another year.
Understand The “Caps” on Each Covered Item. Caps are the maximum amount the home warranty company will pay to replace your appliance, system, or other covered item if a full replacement is required. Make sure you understand not only which items in your home are covered, but also how much you could still be liable for if it requires a full replacement.
Make sure you know which systems and appliances are covered.
Know Which Items Are Covered. A base package may cover some of the major appliances and even systems in your home, but you can pay an additional fee to assure that more unique items are covered too. For instance, if you have a hot tub, 2nd refrigerator, water softener, or septic tank you may want to request rates for coverage. Each company is different and some will even add these items for free with a satisfactory inspection prior to coverage.
Service Fees Are Standard. Some people are caught off guard when they’ve already paid $400 – $500 for the home warranty, and then are expected to pay for a service call when they need to use it. The good news is, it’s usually a fairly minimal charge (usually under $75) and it’s waived with most companies if something needs fixed or replaced.
Most Require You to Use Their Contractors. Although more of the home warranty companies are starting to allowing you to pick your own, you’ll normally find that you’ll need to call the home warranty company when you have an issue, and they’ll send one of their preferred contractors.
In the real estate industry, we often see home warranties purchased (by either the buyer or the seller) to give peace of mind, especially in older homes where the systems are older and may have exceeded their expected life span. Home warranties can be used as an incentive (i.e. “Free home warranty with full price offer”) or a negotiation tool (seller purchasing home warranty for buyer instead of fixing inspection items).
Home warranties are one of those things you hate spending money on…..until you need it. Then, you can be very grateful that you have some financial relief and organized service when dealing with unexpected problems. Each situation is different, so reach out to your agent for some recommendations and contact information for a home warranty company to get specifics.
If you’re on the way to purchasing a home and debating your financial situation, let’s look at some of the costs you should expect once you get under contract. This may help you determine if it’s the right time for you to buy or find other sources to help pay for the upfront costs associated with purchasing a house.
Earnest Money Deposit: Your First Out-of-Pocket Cost
Once you start the process of submitting an offer on a home, there are out-of-pocket expenses that you’ll have to be ready for immediately. The earnest money deposit is typically about 1% of the purchase price in the Colorado real estate market, so on a $400,000 home you should expect needing $4,000 in a bank account with immediate access to the money (check, wire, cashier’s check, etc). Although the contract allows for this deposit to be made after the offer is accepted, it’s typical that the seller will want your funds in an account within a few days of a signed contract (usually held at a title company or real estate office in an escrow account). The good news is, this money is truly a deposit and as long as you meet your deadlines and eventually close, you can apply these funds towards your downpayment or other closing costs. In other words, you’ll potentially get the money back but you’ll need the funds available to deposit at the time of your accepted contract.
Home Inspection: It’s More than Just a One Day Event
Your due diligence and inspection period allows for you to do inspections of any kind on the property as long as you’re not negatively altering or damaging the property. This means not only can you do a typical home inspection (in which you hired a home inspector to do an inspection of systems, mechanicals, exterior and interior condition, etc), you can hire contractors for specific issues and inspections. For instance, you may want to have the sewer line scoped, engineering reports of the structural integrity, or substance testing for things like mold or presence of drug residue. Depending on the home inspection company, they can often do testing for things like radon gas levels but there is usually an additional charge. Currently, rates for a home inspection vary depending on the size, age, and other factors of the house, but expect about $400-$500 and then additional items like radon gas and sewer line scoping will run another $150+ each. So, this “inspection amount” can change dramatically based on your concerns and curiosities as a buyer, but it’s not hard to reach nearly $1,000 just for basic inspections. And keep in mind, these contractors and inspectors are paid when the service is rendered so it is a direct out-of-pocket cost while you’re under contract. Also, there are other things that won’t necessarily cost you money but you should definitely consider researching as part of your home inspection period.
Property Survey or Improvement Location Certificate (ILC)
It’s possible that either the lender or title company may require a land survey or ILC. Typically, these are due at time of service and estimated starting cost would be $800+ for this type of service. Usually if the home is in a neighborhood with lot and block, this won’t be a required item. However, during your contract period, you can certainly choose to do this yourself so you are aware of the property boundaries, especially if you’re considering building a new structure, putting up fencing, or expanding the current home.
Downpayment on Your Loan
When you first start the process of searching for a home, you’ll talk with a lender about getting a loan to help pay for the purchase (unless you’re buying with cash). The lender will help find the best type of loan for your situation and qualifications (VA, FHA, Conventional, Jumbo, USDA, etc) and unless you have VA benefits from the military, your loan will probably have a minimum of 3.5% down (FHA) but probably more like 5% down (or more). Based on the type of loan, intended use of property, and other factors this can be 20-25% down. So, with a purchase price of $400,000 you could be looking at $100,000 as a down payment for the loan, and you’ll still have closing costs in addition to that amount. More money down can also reduce your monthly payments, decrease your interest rate, and waive the need for mortgage insurance. Make sure you talk with an experienced real estate agent and your mortgage lender to make sure you understand the entire package and what your monthly payment will be with principle, interest, taxes and insurance (PITI).
Depending on your offer, a portion or all of your closing costs can be paid for by the seller. However, it’s not as typical in a seller’s market as it directly affects their bottom line. So, assuming your paying your own closing costs this will be a collection of fees at closing in addition to your purchase price and loan downpayment, minus any credits you’re receiving. Closing costs include a variety of processing and document fees, lender escrowing funds for things like homeowners insurance and property taxes, appraisal fees, title company fees, recording and document fees, and any administrative fees charged from the real estate company.
Moving Into Your Home
Keep in mind, these expenses aren’t accounting for the setup of your new home, including things like buying furniture, doing landscaping, basement finishes, interior paint and flooring, or simply maintenance issues that might have come up during your inspection. If you can, start putting money away in a separate bank account as an maintenance fund to pay for large expenses like replacing a roof, driveway, exterior painting, tree removal, flooring updates, etc. Ask your agent first when doing these type of updates to help discover if there are ways to save money and for a list of recommended companies.
Sometimes it’s about the the things you’re NOT doing that make a difference. Maybe it has been a while since you painted the trim, cleaned the pool, or serviced your furnace? It’s sometimes hard to keep up with home repairs and maintenance, but it’s important to not let items get worse or neglected altogether. Things that seem like a normal irritation to you may be a deterrent to a homebuyer. In fact, it may even affect the buyer’s loan qualification for things like cracked windows, chipped and peeling paint, or other health and safety items that you’ve written off as “honey do’s” over the years.
Smoking Inside Your Home
Whether you smoke cigarettes or perhaps your taking advantage of the recent Colorado rights to smoke pot, these and illegal drugs may turn off potential buyers. Cigarette smoke can stain and seep into surfaces creating an odor that’s tough to remove. Even smoking pot can cause some buyer’s heartburn if they smell or get an official test through an industrial hygienist.
Pet Smells and Damage
We all love our furry friends – they’re part of the family! But could you pets be jeopardizing the sale of your home? Cat urine in particular is very noticeable to buyers, as well as dog odors and visible stains. Even if they are potty trained, the damage caused by pets on both the inside and outside of your home might detract potential buyers.
Over-The-Top Decor and Colors
Did you paint your kitchen cabinets bright orange? Great! You loved it while you lived there, but chances are it’s not what your future buyer is looking for in a kitchen remodel. It’s important to make your home your own and pick the colors, designs, and amenities that you want. However, once it’s time to sell, consider painting or changing some of these very unique features. Both inside and out, have your experienced real estate agent suggest potential updates that could save your home from being eliminated from a buyers search.
DIY Homeowner Repairs and Finishes
The good news is upgrading electrical, adding a room, and finishing off a basement actually add value! However, if you are mister “I’ll Take Care of It Myself To Save Money” and you’re not pulling permits through regional building department, this upgrade might backfire when the buyer’s inspector pulls permit records. Also, these visible self-repairs can make buyers question how many other things you’ve “fixed” that they can’t see or don’t yet know about.
It Didn’t Bother Me…..
Burnt out light bulbs, dust on fan blades, missing light switch plates, dirty windows, noticeable odors, and simple repairs can make a major difference when buyers are seeing your home for the first time. Don’t neglect the easy final steps in putting your home on the market. Have your real estate agent walk through with you and direct you of important items. Sometimes, you just need a second set of eyes to notice things you’ve overlooked.
We’ve all done it: you start a project that takes more time or money than expected and it gets put on the back burner for a while. Partially-laid flooring or baseboards that never got reattached, unfinished landscaped features, or maybe something more major like an unfinished bedroom addition. Ignoring these issues might be easy for you, but they are some of the first things buyers notice when your home is showing.
There are pros and cons to all types of stone countertops. How do you choose which ones are best for your home? Knowing the properties of each type of stone will help you make the right decision.
Granite – According to TheSpruce.com, there are over 3,000 types of granite. Despite its strength, granite is porous, which means it can absorb stains unless it’s sealed. It can crack if not properly fabricated and installed. Yet, granite’s beauty and variety make it the most popular choice for countertops.
Soapstone – Soapstone is a “magnesium-rich metamorphic rock” containing up to 80% talc, making it ideal for carving. However, there is a stronger strain called architectural soapstone that is impervious to staining and scorching. Damage can be sanded out. It requires no sealant, but mineral oil helps develop its patina, which darkens with age.
Marble – Marble is one of the most beautiful stones and is frequently used as in small amounts such as a bathroom countertop. It stains and scratches easily and requires sealant, making it less popular for kitchens. Like granite, it adds value to the home.
Quartz – Engineered stone is man-made of approximately 93% quartz and the remainder in resins. Developed as an alternative to granite, it’s nearly as expensive, but performs much better. While granite, soapstone and marble feature artistic veining and natural “flaws,” quartz is manufactured to have uniform patterns and colors. The advantage is a surface that requires no sealant that’s more durable and scratch resistant than natural stone.
If you’re looking for a pro to help make the best decision for your home, please contact us for a list of companies who can help.
Although there is basic information about your city readily available, sometimes it’s more challenging to gather info about your home specifically. Here are the Top 7 Resources for researching your historic home:
Sanborn Fire Insurance Maps Take a look at the Sanborn Maps archive, dating back to 1867. Although these were used for different purposes in the past they are now a great tool to get information about homes and cities. It’s amazing how much history can be contained in such a simple illustration, including owner names and structure type. https://www.loc.gov/collections/sanborn-maps
Local Library Research Tools Get a library card at your local library district, and you’ll most likely have access to free tools and information. Depending on your library, research can be done online or onsite, often with free services of a librarian helping guide you in your research. There are a variety of databases you can access, including local newspaper archives and online maps which will probably be the most helpful for gaining insight about your house before you lived there. Side, note, the library can also be a great place to research your genealogy while you’re at it! https://ppld.org/databases/all
Local Historical Society or Pioneer Museum There are multiple Pioneer’s Museums that help retain and preserve the history of the region. Colorado Springs Pioneer Museum is a staple of El Paso County and has excellent online records. Additional similar resources would be Old Colorado City Historical Society and History Center and Florence Pioneer Museum and Research Center. Visit Colorado Springs Pioneer Museum https://www.cspm.org/research/ and with any of these locations, consider making a donation to help keep them running.
Title Research Typically when purchasing a home, a title company is hired to research the title history because they will be issuing your title insurance. Although they’re motivation for the title research is to protect their interest and future claims against the property, this paperwork can be very informative about the parcel of land and the home itself, as well as other structures and rights pertaining to the property.
Ask the Previous Owners When you purchase a home, especially an older home with a rich history, ask if the owners have any knowledge or documents about the homes’ history. Often, stories and information is passed down verbally but there may not be a written or permanent record of it in existence. If someone suddenly shows up at your home and says, “I grew up here – can I come in and see it?” – welcome them in! This may be your best opportunity to capture oral history of the home.
City Directories or Phone Books Before phone books were city directories, housing a plethora of information about who lived where, and even their profession. Use the online research tools at your local library, or even genealogy websites to scan old city directories for you home’s address.
Hire a Historian Finally, if you don’t have the time or want to spend the time doing your own research, hire someone who is familiar with the process and tools available. Just as with real estate agents, an experienced professional knows their field and can often create better results in much less time.
Inspectors agree, one of the most common issues we find during the home inspection are issues with gutters. Gutter maintenance may not be the most exciting home repair – you don’t see many programs on the home improvement channels dedicated to gutters and downspouts – but they are essential to maintaining an attractive and safe home. These are the common problems we see with gutters and our suggested solutions:
Problem: Clogged Gutters
Clogged gutters can cause an array of issues, including roof and foundation damage.
The easiest solution is to have a gutter cleaning professional service your gutter system at least twice a year in the Spring and the Fall depending on how many trees are in the yard. Cost ranges from $125 – $200 depending on the size of the home. Preventative care is the best option.
Like many other gutter problems, leaks can cause damage to your roof, siding, and foundation.
Leaky gutters can be sealed by caulking the joint from the inside (think infomercial with a screen door and boat). Larger leaks or holes may call for a professional to service your system. Minor repairs like caulking will range from $175 to $500 for a contractor.
Problem: Defective Pitch
Gutters need a slight pitch to drain properly. Gutters that are improperly pitched can result in standing water which damages siding, roof sheeting, and can attract mosquitos.
If you decide to DIY on this job, you will need a helper and have them hold the gutter while you loosen or remove the gutter brackets or hangers. Pull the gutter down about 3 quarters of an inch lower than it originally was on the problem end by a downspout. Put a temporary screw at the back to adjust the pitch. The gutter should have a quarter-inch of slope per 10 feet. Once the gutter is properly pitched, re-install the gutter brackets. If you choose to hire a contractor you can expect the cost to be from $175 – $500.
Problem: Saggy Gutters
Over time, gutters get saggy and can even pull away from the home. This most often occurs in gutters that are not cleaned properly. The root of the issue is in the fascia or the hardware that secures the gutters to the roof which can deteriorate over time.
The only solution for sagging gutters is to have a professional fix or replace them. Cost to replace gutters can range from $575 – $1475 depending on the materials you select and the size of your home. After your gutter system has been fixed or replaced, be sure to have them cleaned periodically to prevent the problem from resurfacing.
Content provide by Home Inspector Dana Aderman with BPG Inspections. Contact him anytime for helpful advice on any home maintenance or repair item.
When purchasing a home, there’s more to think about than just the home itself. There are many factors that may affect your comfort in your new home, both mentally and physically. Make sure during the contract process you do your due diligence as a buyer and research the things that are important to you or might affect your decision to purchase the home. Check with your real estate agent on dates and deadlines to make sure you know the time-frame you’ll want to accomplish this research.
Property Insurance / Homeowners Insurance
Call your current insurance company and other property insurance companies to compare quotes. Make sure you have the information about the property in front of you (either a MLS sheet or assessor records) and can answer basic questions about the home. The main purpose of this step is to make sure you’re (1) comfortable with the potential rates (2) that the home can be insured based on the current condition.
During your home inspection phase, you have the right to test for substances in the home as long as you’re not altering or destroying the home. This means you can test for things like methamphetamine, marijuana residue, mold, lead based paint, radon gas, and more.
Sex Offender List
Keep in mind your neighbors will come and go and things can always change around your home. However, if you’re concerned about potentially living around someone who is a register sex offender, you may want to consider doing a search prior to purchasing the home so you’ll at least know where they live in your area. https://www.nsopw.gov/
Many buyers are curious about the crime rate in the area surrounding their potential home. Whether you’re currently under contract on a house or still searching for a home, knowing the crime stats might help you pick your desired neighborhood. Consider asking locals and friends as well, or get feedback using local area groups on sites like Facebook or Nextdoor. https://coloradosprings.gov/police-department/page/cspd-statistical-and-annual-reports
Flight Patterns, Train Tracks and Highways
Take time to research your proximity to transportation routes which might be a nuisance. Whether it’s noise from a nearby highway or interstate, or the travel patterns or trains and airplanes, some people like the noise and others might regret ever buying a home near these routes. Make sure you experience the neighborhood at different times of day and night, ask the sellers, and do your diligence if you think it’s going to be a concern down the road. Also, check if there are future plans for these types of improvements.
Check with your agent or use the link below to verify if your home is in a flood zone. If it is, most likely the lender will require you purchase flood insurance (if you’re getting a mortgage to purchase the home), and sometimes even the title company will require flood insurance. Keep in mind, flood zones can change.
The history of permits pulled on a property is all public record. You can search any address to find if permits were pulled for home renovation projects, home additions, mechanical systems like a new furnace, plumbing upgrades or fixes, electrical changes and additions, etc. Details including the date and contractor are available on Pikes Peak Regional Building Department’s website.
Let your agent know if there are other things that concern you or that may keep you from purchasing a home. Your agent doesn’t want you to regret the decision or be surprised in the future. Check with your agent on what type of items are required to be disclosed by the seller and get a seller’s property disclosure prior to your home inspection date.
When our clients say Sell My House Fast Colorado Springs Realtors at Berkshire Hathaway jump to the opportunity and challenge. Our team of experienced real estate agents engage intentional, direct and effective marketing tactics immediately. The specifics might bore you, but the results are what you’ll talk about for years when your home is sold as quickly as some of these.
320 Childe Dr, Colorado Springs, CO 80906
This was perhaps one of the most impressive homes we’ve had the privileged to market and sell. Granted, the absolutely breathtaking views and updated fixtures and amenities helped sell this custom Broadmoor home. But typically, a home in this price range (this home was listed for $799,000) stays on the market for an average of 9 months. With an average price point just above $350,000 for single family homes, this beautiful home in southwest Colorado Springs would typically be expected to have slower showing activity and longer days on market. However, this home was under contract in less than 24 hours with multiple showings and competitive offers that exceeded list price. Real estate agent Wayne Jennings represented the sellers and was able to provide the marketing exposure and tap into the niche buyer group that had been searching for this type of house. Consequently, when it hit the market in April 2019, it was a quick turnaround and huge celebration for the sellers.
230 E Main St, Florence, CO 81226
Just outside of Colorado Springs to the southwest is the quaint town of Florence, CO. It’s been a tourist destination for years, as the town has rightfully claimed the label, “Antique Capital of Colorado” due to the solid option of antique stores along Main Street. With a lower altitude and warmer climate that Colorado Springs, plus a homey small town community, Colorado natives and out-of-state residents are flocking here to vacation, invest, and live. So, a newly renovated single family home on Main Street within walking distance of Florence restaurants, shopping and entertainment has a strong appeal. In fact, many are waiting to jump on an opportunity like this, especially while home prices are still reasonable. That’s exactly what happened at 230 E Main St the day it went on the market. After years of renovations and hard work, the seller made what was an eyesore along Main into a luxurious residence that anyone would love to call home. Buyers quickly set up private showings and the home was under contract within 24 hours.
4988 Old Fountain Blvd, Colorado Springs, CO 80916
Homes all over Colorado Springs are represented by our agents and selling in 24 hours or less! We sell in every area, every price range. With 76% of the sales in the Colorado Springs area in the $200,000-$400,000 price range, there’s a lot of competition among buyers. It’s definitely a seller’s market in this bracket of sales (meaning the seller has the advantage and more power in negotiations, etc) and we saw that on 4988 Old Fountain Blvd. This ranch-style home has a lot of great curb appeal, plus extras like a spacious sunroom and patio, and RV parking on the side of the home. When a homeowner says Sell My House Fast, Colorado Springs real estate market still has it’s challenges in accomplishing this goal. The real estate agent has to be thoughtful of pricing the home correctly, marketing and promoting the right features, and putting it on buyer’s radar before there’s even a sign in the yard. Realtor Marion Meyer nailed it on this one, making sure that her colleagues, potential buyers and other key industry contacts knew this listing was coming soon. Thanks to her thoughtful and intentional homeselling tactics, it’s another case of 24 hours of showings ending in a solid contract for the seller.