Early Spring brings early bargain hunters

Spring has arrived in north Idaho with crocuses, daffodils and tulips popping up everywhere. With the departure of the last low level snow folks from and foreign to North Idaho are beginning to show more interest in getting out and in investing in some of the great real estate values in north Idaho.

Certainly more affordable homes are low interest rates are reasons that home sales continue to accelerate as reported here last week. The early spring weather and escalating prices in California and Western Washington are driving out of State buyers earlier this year.

Interest in waterfront properties is on the rise. Our statistics which we reported in some detail last week show that in the first two months of 2016 are over 160 percent of 2015 sales the previous year. That is comparing 21 sales to eight at this time in 2015. While we do not segregate waterfront inventory for purposes of reporting residential inventory we do know that inventory is down by seven percent. A quick search on Friday showed a total of 224 waterfront homes ranging from a $96,000 home on the Pack River to a $10,000,000 home on the Spokane River. Only 170 waterfront listings were available for less than a million dollars and only 78 available for under $500,000. This could be a year where we see escalation in those prices.

True, as the calendar dictated Spring arrives, more properties will come on the market, waterfront and common residential but the supply appears to remain short in all market segments.

With the State entertaining new regulations on submersible pumps for domestic use lake water, no doubt there will be some owners who, no matter the cost, will not want to hassle with replacing pumps if required and will put their properties up for sale rather than make that improvement.

Once again we are pleased to report that, of those properties on the market, we are seeing plenty of activity and for waterfront at least, that activity is earlier than expected albeit welcomed.

The difference between Customer and Client

You already know there are listing agents and selling agents in real estate. Listing agents focus their attention on adding inventory, usually posting their properties in the Multiple Listing Service, exposing the property to all other members. A selling agent is the one who actually brings the offer to purchase. Often, these are called buyers agents. The distinction is so relevant that the State of Idaho requires that an informative brochure detailing “Agency Law” is presented to all parties of a real estate transaction, “at the first substantial business contact”.

The brochure lays out the types of agency relationships as defined by Idaho Code under Title 54. The brochure you receive will state, in a highlighted box, “Remember! Unless you enter a written agreement for Agency Representation you will NOT be represented at all.”

Sellers almost always sign a formal agreement for representation. This listing agreement outlines the broker’s role in representing the property’s owner and details how the broker will be paid, as well as what the broker agrees to pay to a “cooperating” broker. That is to say, the share of the commission to be paid to the selling brokerage. Agents are not allowed to list properties without the broker being the responsible party. Agents may represent the broker, as is usually the case, but the liability for performance is always with the broker.

Many buyers will search for property without a written agreement. The State considers those persons as “Customers”. Under the law a customer may expect a “non-agent” representing their broker to;
Perform necessary and customary acts to assist you in the purchase or sale of real estate.
Perform these acts in good faith and with honesty and reasonable care.
Properly account for money or other property you place in the licensee’s care.
Disclose “adverse material facts” to you which are, or should be, within the licensee’s knowledge.
In bold text the brochure states: “As a Customer, your brokerage will not act as your Agent and is not required to promote your best interests or keep your bargaining information confidential. If you use the services of a brokerage without a written agreement, you will remain a Customer.” So, if you would like to have your bargaining information kept confidential, you probably want a representation agreement which then makes you a “Client” under the law. The duties to a client are broader. Most notably the agent is required to, “Maintain the confidentiality of some client information, including bargaining information, even after the representation has ended.”

In addition to making you a client, your “Buyers Representation Agreement” will also enumerate the types of real estate your agent will show you, the geography where that real estate may be found and how the broker will be compensated. A broker may agree to only the compensation offered through the listing agreement, or they may require a retainer, hourly rate, or a commission in addition to that offered by the listing brokerage. Your agent may also be willing to seek out, “For Sale by Owner” properties. Your agreement will address how the brokerage will be paid for these efforts as well.

If you go directly to a listing agent to buy a property, remember that the broker’s first loyalty is to the seller, with whom they have a written agreement (contract). As a buyer with the seller’s brokerage you have a right to be represented as well. There are two options under “Limited Dual Agency”:
Limited Dual Agency without Assigned Agents: As a Limited Dual Agent, the brokerage and its licensees cannot advocate on behalf of one client over the other. The licensees cannot disclose confidential client information.

Limited Dual Agency with Assigned Agents: If your brokerage has obtained consent to represent both parties as a Limited Dual Agent, it may assign individual licensees (“Assigned Agents”) to act solely on behalf of each party.

No matter which way you decide to go, a buyer’s agent from a brokerage different from the seller, or under a limited dual agency relationship, make sure you are protected by getting an agreement in writing that memorializes how you and your brokerage are going to work together. To read the entire brochure, contact your agent or go to: http://irec.idaho.gov/publcs/agency-disclosure-brochure.pdf

Choosing the right agent

In a vibrant market many career seekers will take real estate licensing courses, pass the State exam, select a broker and get their real estate license. A percentage will go on to be successful through hard work, integrity and adherence to the Realtor Code of Ethics. A larger percentage will not. There are roughly 1,000 members of the Coeur d’Alene Association of Realtors. The sheer number of agents may be overwhelming but you should be encouraged that the broad field gives you plenty of options to find the right agent for you.

Just as when hiring any contractor you should take care to interview your prospective agent. Asking friends and family for recommendations is always good but if you are new to the area you may not have that luxury. Here is a portion of a letter from a reader who asks to remain anonymous that illustrates the problem: “When we decided to put our house up for sale, we did not know any Realtors and didn’t know anyone to ask for a referral. As many people do, we called a real estate office and the agent we talked to agreed to come look at the house, and list it.
“The agent arrived, liked the house, and asked us what we wanted for it. The only thing that would give us close to a clue was a cost replacement done for insurance purposes. The house was listed for that amount and four months later, there had not been a showing, the agent did not return calls and the contract ran out.
“We had forgotten one important thing when we first listed the house. A real estate agent works for us. When you have a business of your own, and you need help, the process is to request resumes, interview people and find the one best suited to your needs.The second time, we were referred to an agent by someone we knew. Their experience had been a good one, so we contacted the agent.
“When this agent arrived, the first news was not what we wanted to hear, but the house was listed too high. Showing us comparables and information on the market at the time, it was easy for us to realize the price needed to be reduced. Unfortunately, this would not be the first time we had this conversation with our agent, but there was always information available to help us make the best decision.
“Calls and e mails were returned promptly. After almost a year, our house finally sold. Our agent was there to present the offer, give us an opinion, follow through with a counter offer and even attended the closing. Remember, if you need a real estate agent, they are going to be your employee. Ask others if you can, interview several, just as though you were hiring them to work for you, because that is exactly what you are doing. You want to be sure you have the right one before you sign a contract.”
So just as you will perform some due diligence regarding the property you will buy or sell, you need to check out your agent. The Idaho Real Estate Commission website (irec.idaho.gov) will tell you what education your agent has, how long they have been licensed and whether there have been disciplinary actions taken against them. All of this is of little interest though if you do not trust, like or communicate well during the interview. Your property is a huge investment. Use caution when choosing who will represent you in buying or selling.

Benefits of working with a REALTOR®

You may know that all REALTORS® are real estate agents, but did you know that not all real estate agents are REALTOR®?  REALTORS® adhere to the National Association of REALTORS® Code of Ethics, our promise of and to professionalism with our Clients.

The info-graphic with this post shows you ALL the wonderful benefits that come with working with a REALTOR® like Kim Cooper of Select Brokers LLC.

No license does not mean no liability

It appears we got the attention of some folks with the illumination of Idaho’s lack of license requirements in last week’s column. Perhaps we should have mentioned that contractors are at least required to register with the state so they can be held accountable for shoddy work.

The Idaho statute we discovered outlines a process for pursuing contractors who perform substandard work and damage the party that hired them. Of course we are Realtors and not attorneys so you may want to check with a lawyer before pursuing a lawsuit but Idaho Statute. Title 6: “Actions in particular cases” does make provisions to file a claim against a contractor. Chapter 25 is titled the “Notice and opportunity to repair act”.

6-2503 states: “Prior to commencing an action against a construction professional for a construction defect, the claimant shall serve written notice of claim on the construction professional. The notice of claim shall state that the claimant asserts a construction defect claim against the construction professional and shall describe the claim in reasonable detail sufficient to determine the general nature of the defect. Any action commenced by a claimant prior to compliance with the requirements of this section shall be dismissed by the court without prejudice and may not be recommenced until the claimant has complied with the requirements of this section. If a written notice of claim is served under this section within the time prescribed for the filing of an action under this chapter, the statute of limitations for construction-related claims is tolled until sixty (60) days after the period of time during which the filing of an action is barred.”

So, before attempting to recover damages you must provide the offending contractor an opportunity to fix the problem. This opportunity must be in writing. A phone call to the Kootenai County Civil Court affirms that sending your written claim by certified mail is one acceptable method of serving notice. Once received by the contractor, this statute gives them 21 days to reply: “ Within twenty-one (21) days after service of the notice of claim, the construction professional shall serve a written response on the claimant.”

This response should establish a reasonable time frame for the contractor to revisit their work and inspect the claims of the dissatisfied customer: “The proposal shall include the statement that the construction professional shall, based on the inspection, offer to remedy the defect, compromise by payment, or dispute the claim.”

“Within fourteen (14) days following completion of the inspection, the construction professional shall serve on the claimant:
A written offer to remedy the construction defect at no cost to the claimant, including a report of the scope of the inspection, the findings and results of the inspection, a description of the additional construction necessary to remedy the defect described in the claim and a timetable for the completion of such construction; A written offer to compromise and settle the claim by monetary payment pursuant to subsection (2)(b) of this section; or A written statement that the construction professional will not proceed further to remedy the defect.”

If the contractor fails to take this action you now have the right to pursue the matter in Court. So you see, the lack of licensing requirements does not mean there is no accountability. You can find the entire Statute at www.Idaho.gov.

Beware of shady contractors

With every strong housing market related services flourish as well. As more houses are built more contractors register to build them, or at least to perform some of the work. In Idaho contractors are merely required to register with the State. Most are not required to have licenses or prove proficiency. According to the State Department of Building Safety; “Persons who perform electrical, HVAC or plumbing work without a required state-issued license or who violate other applicable codes or rules are subject to civil penalties.”

So other skilled trades do not need a license except for Public Works: “It is unlawful to engage in public works contracting without first having acquired an Idaho Public Works Contractor License of the proper class. The Division of Building Safety may impose substantial administrative assessments for contractor violations.”

With housing inventory low we see more and more people opting to purchase homes for their location, with the intent of remodeling or renovating an existing home to suit them. This puts a homeowner then at some level of risk as they begin to hire unlicensed individuals or companies to facilitate the reconstruction of their home. A little caution can go a long way. The Idaho Attorney General’s office has printed a great brochure to help you minimize the risk of hiring shoddy or even shady contractors. It is available online at the AG’s website.

Even though no license is required there are some State requirements of contractors: “In Idaho, the general contractor must give the homeowner or residential real property purchaser a disclosure statement before entering into a contract with a homeowner or a residential real property purchaser, if the contract exceeds $2,000. The disclosure statement must inform the homeowner or residential real property purchaser that the homeowner has the right to:
• require the general contractor to obtain lien waivers from any subcontractors working with the general contractor (at the expense of the general contractor);
• ask the general contractor for proof of general liability insurance and workers compensation insurance;
• purchase an extended policy of title insurance covering liens; and
• require a surety bond in an amount up to the value of the construction project.
The general contractor must provide a list of all subcontractors, material men, and rental equipment providers directly hired or working for the contractor. The list should include business names, addresses, and phone numbers. The list must be given to the homeowner before the closing of the sales agreement or before the homeowner provides final payment to the general contractor. “

The AG’s office also encourages getting references from friends and family. If you can’t do that ask the contractor to provide some references and contact them. Check to make sure they have registered and verify their business name and contact information. The AG warns that a Post Office Box is not sufficient. You can also check with the Better Business Bureau and the County Courthouse to see if there have been complaints filed and if so, how they may have been resolved.

Your home is likely your largest investment. You have to take responsibility to make sure the improvements you intend to make will be good ones.

Kootenai County Housing Snapshot January through December 2015

Data is provided by the Coeur d’Alene Multiple Listing Service and may not reflect all real estate activity in the market.  January through December 2015     * Site Built homes on under 2 acres.     ** All Residential property types.   Find more great real estate information at www.kimcooper.com.  Kim Cooper, Select Brokers LLC.

Thank you for a great 2015!

Your business is important to me, and I believe in WORKING for you as your REALTOR®.  Because of you, we had a great year in 2015.  We appreciate your business, and hope that you refer Kim Cooper to your friends and family.

Also, as REALTORS®, we love to give back to our communities.  We believe in making a difference where we work and live. In 2015, REALTOR® Associations in Idaho donated $325,000 to good causes.  Thank you for working with Kim Cooper of Select Brokers LLC, and for choosing to work with a REALTOR®!

Idaho REALTORS® with the spirit of giving

Did you know that in 2015, REALTOR® Associations in Idaho donated $325,000 to good causes in their communities.  In addition to this, most REALTORS® donate countless hours of volunteer time and their own money to benefit others.  Kim Cooper, Select Brokers LLC.

REALTORS® in Idaho Giving Back to their Communities

Proud of our profession!  Many REALTORS® in Idaho have a longstanding tradition of giving back to improve their communities.  So many charities and people have benefited from the giving spirit of REALTORS®, such as, but not limited to, scholarship programs, shoe drives, coats for kids, socks and shoes for kids, park improvements, street cleanup, neighborhood revival efforts, blood drives, fire relief efforts, giving of school supplies and more!  Kim Cooper, Select Brokers LLC.