Driving the ‘Highest and Best’ Term into the Ground

You know…it bothers me when I hear real estate agents or builders talking about ‘highest and best’ in terms of money they want you to pay. That term is NOT meant to indicate your best offer, your strongest offer, the best you can EVER do, or please pay more than you can afford offer. What they SHOULD SAY is, “You have 24 hours to amend/improve your offer.” Amend, improve, change the terms, WHATEVER. But NOT ‘highest and best’. That’s a red flag of ignorance of what you learned (or rather did NOT learn) in your real estate classes.

Here’s what that term ACTUALLY means:

The definition of highest and best use is as follows:The reasonable, probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value.

So, if you own a parcel of land, or a building or house, and once it was in the middle of nowhere, and THEN the town expands and envelops that parcel, THEN that parcel’s ‘highest and best’ use might not be residential anymore. It might now be best used for commercial. That could mean more money for you and it might mean that once homey dwelling gets bulldozed to make room for a big old gas station, IF that results in a legal use of the property, a more profitable use, supported by the surrounding land use, you get the idea.

THAT’S what highest and best means, and if your agent uses that term in ANY OTHER WAY, fire them.

Due Diligence in Real Estate

Due diligence means ‘do your job, make sure what you are trying to buy is worth the money you are paying.’ You do this by hiring inspectors AND by looking at the property yourself, with an eye for flaws or better yet, hidden ones.

Look, the NC offer to purchase clearly says that the property is being sold ‘AS IS’. The seller is not even required to enter into a DISCUSSION with you about repairs. So the burden is on you, buyer, and that comes with a big check from you for the right to conduct your ‘due diligence’. That could include but not necessarily be limited to, home inspection, roof inspection, HVAC inspection, wood destroying insects inspection, crawl space inspection, well and septic inspection, radon inspection, structural inspection, a survey….you get the idea. And while you’re at it, stand in the yard and see if all of the rain water is going to wash right into your yard. I tell my clients, “You don’t want to be in the bottom of the bowl”. Look around.

In NC, if a home is listed in multiple listing service, with a couple of exceptions, the seller is required to provide a seller’s disclosure, which OSTENSIBLY would reveal any problems with the home. It would be nice if we could rely solely on that document; however, and I know this will ASTOUND you: Sometimes sellers are not quite honest about things that are wrong with the home they are selling. AND, there’s this little column on the disclosure that is for “no representation”. I like to call that “I don’t know and I don’t care” choice, but that’s probably too harsh most times. What it really means is that the seller really doesn’t KNOW. That part is used a lot of times when the question is about plumbing pipes, for example. Many folks really DON’T know what kind of pipes are in the home. And the ‘no representation’ choice definitely applies to rental properties where the seller hasn’t lived in the home, for example, or an inherited property where the heir truly doesn’t know the details.

What this all means is that you, buyer, should just INSPECT INSPECT INSPECT, regardless. NC is a ‘buyer beware’ state, as we say, but in reality, all states are. You must do your homework, folks. Nobody really can do that for you. Sorry not sorry. If you are able to purchase an entire HOUSE, you should also be capable of getting some good inspections done. Unless you just don’t have to worry about it. It is, after all, your choice. If I am your agent and you waive inspections, that’s going on record with your signature, because…that’s only fair.

Look at fences with squinty eyes, wondering whether that neighbor’s fence is actually on the lot you’re buying, OR whether the fence you’re about to buy is ‘encroaching’ (hate that word) onto THEIR land. Oh yeah, that involves lawyers. Need I say more? That speaks to the value of a survey. You should get one done.

You should expect to pay 1200 bucks or more (particularly if you survey and do structural engineering inspections), BEFORE you buy. Obviously, the more inspections you order, the higher the cost. Most inspectors will ask to be paid for their services at the time the service is provided; some will wait to be paid out of closing proceeds. But regardless of whether or not you close, you owe that inspector. So yeah, you’ll have to fork over some money up front, EVEN if you’re doing 100% financing.

I don’t need to tell you that buying a house is a big deal, but I’m gonna. Buying a house is a big deal. So you will truly need to inspect well before you finalize the deal. That’s what DUE DILIGENCE is for. It’s your time to inspect the home and land, even to see how the sun strikes the kitchen counters in the morning, how the house ‘feels’ when you stand in the hallway, whether you think the puppy will like the yard, all of that. So good luck! Buying a home is exciting and it is also fun if I am your agent. And if I’m your agent, you’ll learn a lot too.

It would be great to meet you. I am always honored to help buyers find their dream home.

Have a LOVELY day.

Brenda Briggs, Coldwell Banker Advantage

Time to get TINY

We have lagged behind the tiny house movement in the past, but we are catching up. Yes, I said tiny house MOVEMENT, and if you don’t know what that is, you’d better wake up. Tiny houses are up to 400 square feet in living space, are usually on wheels, are often set up to be ‘off grid’, are almost always ADORABLE, and the interest is growing almost by orders of magnitude.

Why would anybody want to live in such small space, you ask? Well, ask the teachers, the IT professionals who work from the tiny home, the retirees, who are looking to downsize and save a lot of money (actually everyone does), and the people who crave a sense of community over materialism. That sentiment is growing. People are tired of living in a fire ant bed, and some of these tiny home communities have community garden spaces, natural areas to share, some have picnic areas, places to barter goods or sell art, you name it. By the way, most tiny house dwellers are highly educated; a large percentage have masters’ degrees. But whatever the case, there is a huge wave of interest in this phenomenon, which started a LONG time ago. Some people live in less than 100 square feet, some go up to 400. And their bank account is much larger, let me just say.

In case you wonder, some of these homes have granite countertops, stainless steel appliances, walk in showers, dishwashers, the list goes on. Many find they actually CAN live without a microwave oven, many have telescoping windmills attached and solar panels. Most have a wifi booster. So it’s not like camping, folks. Not at ALL. And by the way, some builders build these homes for people with chemical allergies, or even EMF allergies. The builders are very good at what they do, and are very green and very consumer conscious. Most tiny homes are custom builds, so you get what you want.

In college, I studied the influence of age ‘cohort’ (fancy word for group), usually defined by decades. What became clear is that peoples’ values change by the decade, almost on cue. Thirty somethings are all about building, buying, going and later having kids, very self focused often. Forty somethings are all about raising kids and growing careers and they begin to contemplate how they fit into the overall universe. But seniors (over 55)stop placing value on material things and money, and focus on home and family, and they are most aware of their impact on others. That’s it. Many current tiny home buyers are approaching that age.

Imagine a home with SIX lights. Count the ones in your house right now. So there’s that savings right out of the box. Yes, tiny houses have an average of six lights. You can add lamps. Appliances are smaller, space is at a premium when it comes to storage, so you can’t have a bunch of stuff…that you would otherwise spend money on, but you CAN put full size appliances in if you want. It takes peanuts to heat and cool such a small space and if you put solar panels on top, goodbye light bill. Your carbon footprint is smaller, your cost to live is minimal, you tend to spend more time outside in nature, and you get to feel like you again, without all of the stress of accumulation.

You know, many people live in vans now, did you know that? That’s ANOTHER movement. Tired of the spot after three days, start the engine and move along; see the country. People from all walks of life are becoming more ‘green’ aware, seeing the advantage of not being a conspicuous consumer, and most tiny house owners have NO…ZIP…ZERO…NADA…mortgage, whether they live in a camper, a schoolie, a van or an actual tiny house. That’s life changing, folks. Oh and let’s not forget the innovative ones who build phenomenal homes from SHIPPING CONTAINERS. Yep, some are breathtaking.

Do people with kids live tiny? Yep, some do. And some folks with kids live in schoolies, which I forgot to say, is an old school bus converted to a house on wheels. Really guys, you have to catch up on this stuff.

Go to Youtube and check out Tiny Houses, though. People ALWAYS smile when you talk about them, and there’s a good reason for it. They are usually uniquely stunning, they represent a freeing and relaxing lifestyle, they represent a sense of connecting with community and getting back in touch with nature, all good stuff. Our NC zoning and planning departments need to get on board and get ready. This IS the way we’re heading.