FAQs

Christian: [0:07] Hello, hello, and welcome to another episode of the Awesome in Seattle podcast. This is your host, Christian Awesome, of the Awesome Nossum group at Wilson Realty Exchange, Inc, and today we're gonna be talking about… Dun-da-da-da-da-da-da-da. Actually, a lot of things. We're gonna answer a lot of questions that we get. So we've been hosting this home buyer class called Beers and Home Buying, and we've been doing that for over eight years at this point, and at the end of every single class, we open it up for questions. Today's episode is answering the most commonly asked questions that we get from all of these classes. So- Huge. So before we get into it, let me introduce you to these two beautiful people. We have the one, the only, the dog whisperer, Mr. Les Cutting.

Les: [0:49] Hey, hey, hey. How y'all doing? Woof woof.

Christian: [0:52] And the Seattle native, Ms. Reed Watson.

Reed: [0:56] That's me.

Christian: [0:57] All right. So I'm just gonna get right into it. We have a lot of questions to go over. Again, these are all the questions that we get asked pretty much every single class. Yeah. The first one is, from the day you get your offer accepted until the day of closing, meaning the day you get your keys, how long is that usually?

Reed: [1:13] Yeah, that's maybe the number one question that we get asked. So here in Washington State, it's approximately 31 days, so about a month from when you get your offer accepted to when it closes. Uh, but that can vary a little bit. In competitive situations, sometimes the seller wants a very quick close. So if you're working with a lender who you're confident in and, you know, who's confident in your loan, perhaps you've gotten pre-underwritten, you can close closer to 21, maybe 20 days. Um, if you have a lot of cash or p- or paying cash, you can have a super fast close if you'd like to. Um, and sometimes in a competitive or non-competitive situation, the seller will want a little bit of extra time in the home to be able to move out, so you may extend the closing a little bit past 30 days, uh, or provide them with a rent back and move into the home a few days or a few weeks after you've closed. So those are sort of your options, but generally, it's gonna be about a month.

Christian: [2:08] Yep. Uh, Reed, when is a good time to buy?

Reed: [2:13] That's a great question, uh, to ask in what we call a strategy session, which is just a free 30-minute consultation with us over Zoom. And it's because it's kind of, it really depends on your personal situation. Mm-hmm. So we actually address this question in the class because we get it so often. And there is a cycle to the market. There are gonna be, uh, far more homes on the market in the summer because the real estate market kind of follows the job market, which follows the school year, and it's also nicer in the summer, so easier to look at houses. Fewer homes are gonna be for sale in the winter, but there are also gonna be far fewer buyers because people don't really wanna move around the holidays, and it's kinda yucky outside, and people don't wanna be looking at backyards and things like that. So it's not that there's a better or worse time to buy. It's just a different amount of inventory and a different number of buyers. Um, it really depends on sort of your job schedule, perhaps if you're getting a raise, or, you know, your, your personal life and your family schedule. Yeah.

Christian: [3:10] All right, Les, how much do you need for a down payment? Or otherwise asked, how much should I put down on a house?

Les: [3:16] That's a great question. So, um, it really depends on what you're working with ultimately, but, um, what we see that what's most common here is around a 5%- Mm-hmm … um, down payment. Um, you can go as low as 3 with certain loan programs, but 5%, um, I think around 68% of the population in Seattle has a 5% or less- Yeah um, down payment. So I would say around 5%.

Christian: [3:41] Perfect. Yeah Where do you, as the Awesome Nossum group,

Les: [3:46] work? Great question. Our agents, we kind of live all over the place. Couple of us in Seattle. I'm in Snohomish County myself. I think Mel is over on the east side.

Christian: [3:58] Mm-hmm.

Les: [3:58] So I would say for me, personally, I do… I don't mind Pierce County, depending on where in Pierce County.

Christian: [4:04] Mm-hmm.

Les: [4:05] King County, and Snohomish County. I, I've covered those three counties. Now, um, I have gone out farther in the past, but it just really depends on every situation.

Christian: [4:15] Yeah. Kind of depends on how busy we are- It- … how much time we have to, to give to you. Because we never want to overextend ourselves, um, where we're not able to give you the service-

Les: [4:26] Right that you

Christian: [4:26] need.

Les: [4:27] And if we can't do a good job outside of the areas that we normally cover, we are well-connected as far as agents go, so we can help you find a fantastic agent in an area that you're looking in. So.

Reed: [4:40] So I have a few FAQs for you, Christian.

Christian: [4:42] Ooh, bring it on. Um,

Reed: [4:44] here's a big one. Can I rent out my condo, and how and if does house hacking work for condos? Ooh. We will have an episode all about house hacking. It's gonna be our next release, so episode 88.

Christian: [4:57] Ooh, okay. So look for it, not this week, but next, two weeks from now, actually. Two

Reed: [5:00] weeks from now.

Christian: [5:01] All right. So can I rent out my condo, and how does it work with Airbnb, if you wanna go that way? So it's kinda two different questions. Yeah. Can you rent out your condo? Maybe. Is the answer. And the reason why it's a maybe is because every homeowners association has different rules. They, some will allow you to rent out as many units in the condo complex as you want. So if they have a 0% non-owner occupied limit, or otherwise said, 80% has to be occupied by owners or whatever their limit is, if there's 100 units and they say 80% has to be occupied by owners, then that means that only 20% can be rented. So only 20 units can be rented. Now, if you have a smaller complex and it's that same percentage, 80%, um, and you got a 10 unit complex, only eight can be rented so only, or only two can be rented 'cause eight have to be owner occupied. So if you're about to rent out your unit and there's currently space, and then all of a sudden unit three or B or whatever decides that they get their paperwork in and they rented before you, you're kind of SOL. It really sucks for you because you're no longer able to rent out your unit, um, 'cause the limit is only two in that complex.

Reed: [6:19] Here's a follow-up. How would I go about investigating that if I am looking to purchase a condo?

Les: [6:25] In the resale certificate, it'll tell you how many units are actually own- o- owner-occupied versus rented out, so that's how you'll be able to find out what that ratio is and if you're able to rent it out. Yeah, as an agent, definitely we, we, we, we have access to that, so before you, um… While you're under contract, we'll retrieve those documents for you to review, and then we also submit those to your lender to review to make sure everything is good because the lender's not gonna loan on something that can't be rented out or if the, um, owner, owner-renter occu- occupancy ratio is off.

Christian: [6:59] Yeah. Perfect. So i- in terms of house hacking, and then I guess the third question you asked was Airbnb, um, house hacking, if you're going to rent out a room, maybe you have a two or a three-bedroom condo, generally that's totally fine. I don't, I haven't run into any situations where you're not allowed to rent out the room. But again, that rule is gonna be in the resale certificate, in the rules and regulations of the homeowners association. So you will be able to find that out before you actually have to purchase the place. In terms of Airbnb, this one is very, very tricky. There are not very many condos- That allow Airbnb. Um, there are a few here and there, but for the most part, in general, they don't. I would say 95%, if not more, of units are not allowed to be Airbnb.

Reed: [7:50] Absolutely. Here's another one for you. Can I use gift funds for perhaps my down payment to purchase a property, and who can I receive those gift funds from?

Christian: [8:02] Hmm. Great question, Reed. It's like you know what questions people ask us. Um, so yes, you can definitely receive gift funds, and often our buyers do get gift funds. I, I don't know how, what the percentage is. Maybe six out of 10 times people are getting gift funds, maybe more. Whether it's a ton of money or whether it's just a little bit, um, you gotta ask your lender and see what those limits are. Uh, if it is a lot of money, they might say that that person needs to be on the title with you. It really just depends on what the lender says. Um, in terms of who can give it, it used to be immediate family. Now, it has just recently expanded to close friends. I don't know how they define that, but apparently close friends can now give you gift funds as well. So, um, that, that opens up a lot of potential people to help you with your down payment. All right. Reidy Bird.

Reed: [8:57] I'm ready.

Christian: [8:57] Okay. Do I really need to get an inspection when I'm buying a new construction house, or a townhouse, or whatever?

Reed: [9:04] Yes. Um, no, really. Any- Even if, whether new construction, townhouse, new condo building, uh, n- new data, just always get an inspection. Yes. Always see an inspection, but for- Always, always, always … including for new construction, even though it is brand new, yes, you ought to get an inspection.

Christian: [9:21] Yeah, there has been times where we've… I've heard horror stories from inspectors inspecting new construction, um, properties, where it was already signed off by the city, and the city inspector said, "Yeah, it looks great," and they go in the crawl space, and they see some glaring defects. Or they go in the attic, and they see some glaring defects. Or the plumbing isn't totally plumbed correctly, and there's no hot water to one faucet, um, because they just forgot to connect the hot water lines, and they didn't catch it when they did the final inspect. Like, there's all sorts of, of potential crazy things that could pop up when it is new construction. So in addition to getting a, a- an inspection for new construction, get it for every house that you buy. Always get an inspection, no matter what. Or at least look at an inspection report. Uh, Reed, how early should I start looking to buy? I'm, uh, I am potentially, you know, I just, uh, I just signed a lease a few months ago, and I have, you know, maybe eight or nine months left. Should I start looking now? Should I wait? When, when should I look?

Reed: [10:22] Well, that's a good question. If you have a lease that's ending pretty far out, and you don't wanna break your lease, which sometimes it really does make sense to break a lease- Yes … so we always encourage people to look into how much that actually costs. Mm-hmm. And in the grand scheme of purchasing a home, it's usually not a prohibitive amount of money. However, if you're really trying to time that right, I would suggest looking, getting pre-approved at least minimum three months before your lease is gonna be up-

Christian: [10:51] Mm-hmm … Reed: um, and, and giving yourself at least two to three months to look. This also, though, really does depend on the state of the market and where you're looking as well as, you know, just a little bit kind of how picky you are and, and what type of property you're looking for. You know, how commonly does that type of property come on the market? Is it common to find in your areas of interest? Is there a lot of inventory in the area that you're looking for? Yep. These things can really depend, so sometimes you wanna give yourself a lot more time than that. Um, you don't wanna be stressed out. You also wanna look into maybe if your lease could go month to month in the future. Yep. Um, so it is a slightly personal question. It does depend on your situation as well as just the time that you ask it because the market can be wildly different. But you definitely wanna give yourself a buffer of- I usually say at least two months, like at the very minimum. Mm-hmm.

Reed: [11:44] I don't know if that's kind of what you guys feel as well.

Christian: [11:46] No. Yeah, I mean, I'd say- Yeah at least two months, and the, the reason why too is remember, like we answered earlier, it can take about 30 days from the time you get your offer accepted until the time that you actually are the owner and can move in. So if that's a month, you might need at least a month to find a house. Yeah. Generally, houses come on in the middle of the week. So every, every week, there's a new inventory flush of homes coming on the market midweek. So really, in any given month, there's only about four times when homes come on the market. So you don't want to only give yourself kind of four cycles of homes hitting the market to choose from. Yeah. 'Cause that's not really a lot. That's pretty tight. Yeah. And again, it, this is a really, really, really personal question for you, one that we will help you answer or at least give you the information so that you can make that informed decision, um, during these strategy sessions that we have, that we, again, we do these totally free. There's no cost at all. Um, there's no pressure. You don't even have to necessarily use us if you don't like us. Like, it's really just a free way to talk with an expert and get your questions answered. All right, Les.

Les: [12:55] Yes, sir.

Christian: [12:57] Les, what is the first step to buying? If I'm thinking I wanna buy a house soon, what do I need to do first?

Les: [13:05] All right, so we have refined this process over the past eight years and, um, you probably always hear us talking about it. Schedule a strategy session with us. I think that's probably your best bet. Get all the questions that you have, let us answer them, and then get connected with a, with a lender and see what you can really afford, then have us- Mm do a sold search. I know I threw out a lot of terms out there.

Reed: [13:31] Yep.

Les: [13:32] But, um, if you come to our class or if you wanna see a copy of our class, it'll make much more sense. But- Mm-hmm … we really think a strategy session could benefit you so much. Strategy session, um, is basically you having a one-on-one with us and we're just explaining to you the current market positions and how to s- set yourself up for success down the line when you do purchase a house. You're not committed to buying a house, you're not signing anything weird. It's just us giving you a bunch of good information that you can use in your home buying journey. Yep. So I would s- suggest a strategy session first.

Christian: [14:06] Yep. Yeah, so first come to the class. After you do that, have a strategy session, and then with the knowledge that you gain from that strategy session, you will understand, you know, if it makes sense for you to buy at all. Sometimes people come to these, to our classes and they have a strategy session, and we help them build a three-year roadmap on how they can successfully buy a house- Yeah … in three years. Yeah. Not right now.

Les: [14:28] And our class is a lot of good meat and potatoes, like it's a great baseline of- Mm-hmm … um, any new home buyer, um, of where you should start, you know? Um, a lot of agents are different and I, and I've worked for a lot of different companies, so I- I've seen all the tricks and techniques out there, and in my opinion, I'm not just saying it because I'm on this team, but, um, our strategy is so laid back, our approach is so laid back, and you will leave with a ton of value, whether you use it or not, but you'll- Yep you'll definitely have a good baseline of where to start.

Christian: [15:03] All right, what about the question that we get all the time, "Can't I just use my bank to get my mortgage?"

Les: [15:09] You can use whoever you want to get a mortgage. However- Sure … since our market is so competitive, a lot of the listing agents are very savvy, and they wanna see somebody potentially local that knows what's going on in our market and, um, how, how we move and how quickly we would move. Um, a big bank may not necessarily know the hair about our market, but they may not necessarily know the ins and out that a local banker may know. So I would suggest, you know, going with a, a local lender. Um, we have tons of references that we can recommend to you guys, but you can use your big bank, sure, but I've… Every time I've had a transaction where the person's used the big bank, um, it's hard to get ahold of that person after ni- 5:00 PM, you know? And sometimes- It's tough … these negotiations take place. If you submit an offer, the negotiat- negotiation takes place

maybe 6: [16:04] 00, 7:00 PM, 8:00 PM. Mm-hmm. And I can't get ahold of that banker to vouch for you. Yep. And oftentimes they'll go with a different property if, um, if it's a multiple offer situation. So-

Christian: [16:16] Yeah … Les: you definitely wanna have someone local who will pick up your call or- Yeah. Even in a non-competitive market like we're going into now, it's just- Better … a local lender is so much better for you. Um, one, they have all the connections that are local. Two, like Les said, you can reach them after hours. That's a big deal. Um, three, they're gonna be just as competitive, if not better, in terms of interest rate and costs. Uh, and you just get a much more personalized, um, approach to the entire thing. You're gonna feel a lot more confident. Uh, I'm… Maybe in my 18 years, I've had one or two positive experiences with big banks. That's about it. All the others have been like, "God, this sucks." Like, "You shouldn't have done that. That was a bad choice." And they generally regret doing it. So follow the advice and, uh, and learn from our experience. It's better to work with a, with a local lender. All

Les: [17:14] right, so Christian.

Christian: [17:15] Yes.

Les: [17:16] Get this one. Quite, it's very popular question.

Christian: [17:20] Mm-hmm.

Les: [17:21] How do I know what I can afford?

Christian: [17:23] That is the million-dollar question, and sometimes it's a million-dollar answer. But, uh, this is what you learn from that strategy session. So, um, I know we've harped on it a lot, and it is an important step. That's why we keep bringing it up, because at these strategy sessions, we, you, you will walk away an understanding what you can actually afford. Uh, we generally bring on a lender on this call with you, which is unheard of in real estate. Generally, the real estate agent and the lender are two completely separate entities, which we are as well, but unfortunately, most of the time, the lender and the agent never know each other. They never talk to each other. There's no experience between them. We have lenders that we've worked with for years, who we have tons of experience with, who join us on these calls that are one-on-one with you, and you will walk away knowing, "Okay, based on my down payment, what my credit is, how much I want to spend every single month"… They'll work backwards and go, "Okay, well, don't… Here's how much you can get approved for. Don't go over that amount because based on what you wanna spend every month, this is the max you should go up to." So i- it's a personalized question, obviously, um, and that's why these strategy sessions, again, are so important.

Les: [18:41] So next question, really popular question. Are there any loan assistance or down pay, down payment assistance programs available for first-time home buyers?

Christian: [18:52] Yes, but, and it's a big but, uh, a lot of times they're income-capped, and in order to survive and live in King County, like that's what I'm gonna focus on first, um, and even Snohomish and Pierce, a lot of times your income is going to exceed that. So, um, that said, we can definitely put you in touch with lenders that have these options available, so just reach out. We can put you in touch with them. Obviously, there's no cost for any of these things. Um, and then they can answer that question specifically to you. There are some out there. Generally, though, a lot of people don't qualify. Um, so we'll just have to see. But with prices going down, like this might, they actually might come back into favor a little bit if prices do continue to go down slightly. Um, for a while there it didn't really make sense because even if you could get a mortgage based on these first-time home buyer assistance programs, you couldn't compete because the market was so competitive, and a seller didn't wanna accept an offer f- when you had one of those low down payment assistance programs. So, uh, but with the market changing-

Les: [20:00] Takes a lot of selling on the real estate agent's part- Yes … to get, to convince the seller that this is a sure shot. Yep. I've dealt with a couple in the past, and, um, they weren't easy. Just they have negative connotations around them. Yes. You know what I mean? Yeah. So, um-

Christian: [20:18] Which are not necessarily true.

Les: [20:20] Yeah, exactly. But I mean, they're, they're as good as cash. Um, but yeah, sellers in their mind just- Bad taste-

Christian: [20:29] Mm-hmm … Les: when you present them those kind-kinds of offers, so. Yep. Reed, what are some up-and-coming areas in and around the Seattle area that you like?

Reed: [20:39] Great question. I think we should all answer this question-

Christian: [20:42] Yes

Reed: [20:42] 'cause we each have kind of our favorites.

Christian: [20:44] Mm-hmm.

Reed: [20:44] Um, and there are a lot of different answers. Seattle has a strong economy, and there are quite a few up-and-coming areas.

Christian: [20:50] Yeah.

Reed: [20:50] One of my f- personal favorites is Georgetown.

Christian: [20:53] Mm-hmm.

Reed: [20:53] I live in Ballard right now, and I see Georgetown as being what Ballard was 25, 30 years ago. This kind of up-and-coming industrial area that has all of these cool warehouses for, for breweries and for- Yeah … bars and things. Um, the food and the drink scene in Georgetown is incredible. People who go there love living there, but it's just- But Reed, there's

Christian: [21:17] no housing … Reed: still up-and-coming. But there is housing. Um, and the fun thing about the housing, it's really, really close in to the Georgetown- Yes … little main center. You don't have to walk very far to get to all of these really cool spots. Um, and you're kind of just barely south of downtown. You can get to downtown, Beacon Hill, Cap Hill really quickly. Mm-hmm. Um, and it's just, it's a fun area that's gonna, I think, be really cool and really modern in the future. Uh, but not in that boxy modern way, in that kind of more loft-style- Yeah … you know, converted buildings way that I really love. So that's definitely a favorite. And then, um, honestly, I'm also gonna say West Seattle. Prices have gone up since the bridge reopened, uh, but on the other hand, the bridge reopened, and so prices are gonna keep going up. Mm-hmm. People keep on moving to West Seattle and realizing what a great community it is over there. Yeah.

Reed: [22:05] How much great food and, you know, is over there, amazing parks, beaches. Um, so that is just, in my head, going to keep on skyrocketing now that that bridge is open.

Christian: [22:18] Yeah. We'll see what happens, but yeah, that, that could all make sense. Um, one of my old favorites to promote was North Beacon Hill. Um, I think that's kind of come and gone. Like, it's maybe not gone, but it's definitely come up. Um, and it's been very popular for years at this point. Uh, back when I bought my house and duplex and second place I ever bought in, was it 2007 or '8 or something like that, or '6? I think it was 2006. Um, it was, no one had talked about it. Like, it was… People didn't even know where it was, and still people don't always know where it is, but if you ever lit, rode the light rail, you've gone through it. There's a awesome underground station, and it's one of the only underground stations that were in that in-initial, um, from the airport to downtown Seattle. So it was a great area. One of the areas that I like to kinda have people at least look into is Licton Springs. This is right across the freeway, right across I-5 from Northgate. So old Northgate Mall. Now I don't know what they're calling it. I don't even know if they've come up with a name yet, but that's where the new Kraken Community Iceplex is. They have giant plans to redo that entire area. It's clearly happening as we speak. Um, they built a skybridge across I-5 from the light rail station to the west side of I-5. That west side of I-5 is Licton Springs. It's kind of gone under the radar for a long time. Um, the s- the streets don't have sidewalks, and I think that's part of the downside is there's a lot of, like, dirt and, like, mud puddle parking, s- off-street parking. Mm-hmm. And I think that's kind of been always, uh, I don't know, an issue. But you can get a pretty nice house in there or a house that maybe you can fix up and make pretty nice, and, B, you're so close to Seattle, like to downtown Seattle or to the airport because of that walking bridge across I-5. Um, it's… I feel like it's a great area that's close in that you can still get a deal and not be far away from really much of anything. Les, what's your kinda favorite-

Les: [24:28] Area?

Christian: [24:28] Yeah.

Les: [24:29] So I'm gonna go up north. Um, I live in Snohomish County, like I said. Um, I'm a downtown Edmonds guy. Mm. Um, I love taking my daughter and my wife down there just, I mean, when it's a nice warm day, grab a bite, and then we go play on the beach for a little bit. Mill Creek Town Center, that's my favorite too 'cause it's just right by my house. Um- Bunch of restaurants out there, dog trails, you can walk your dog. Bothell Landing, uh, North Creek Landing as well. Those are my favorite little spots in my area, so yeah.

Christian: [25:03] Cool. So Reed.

Reed: [25:04] Christian.

Christian: [25:06] What are your predictions for 2023? I'm gonna put it all on you.

Reed: [25:09] That's a great question. Um, my predictions for 2023 will be laid out in detail in an upcoming podcast. Um, so- It was

Christian: [25:18] like it was a leading question or something.

Reed: [25:20] Teaser. Um, very soon, in just a few weeks, we're gonna be coming out with both a year in review podcast as well as a 2023 predictions podcast. So th- those are gonna be episodes 89, 90 probably. Um, and we'll get really in detail about what our predictions are. We'll go into some numbers for you and, um, the whole team will get together and, and just go over that. So-

Christian: [25:42] Yeah … Reed: if, if you're interested, definitely subscribe to the podcast wherever you're listening, and just stay tuned for that. We go really in-depth on those. They're a little bit longer. Um, they're a great, great source of information. Yes, a great resource for you to learn and continue learning about the local real estate market in the Seattle area. Highly recommend it. All right, so I hope that this was super helpful. These were the most frequently asked questions that we get. Obviously, we get a lot of other questions. If you have a question that we did not answer and you would like to know the answer, just reach out to us. Also, we had talked about strategy sessions a lot. So Reed, how can someone sign up for a strategy session?

Reed: [26:23] Well, you can go to AwesomeNossumGroup.com/schedule Uh, or you can go to beersandhomebuying.com/ss, and either one of those is gonna get you to us, and you can pick a time for a strategy session. It links straight to our calendar, so you just sign up, and we'll see you, see you there over Zoom.

Les: [26:44] I just wanna stress, when you do a strategy session with us, you're not committing to buying a house. It's simply just a session for us to get to know each other and us give you information, and you take with the infor- take the information and do with it whatever you'd like. But it's always great information, so. Yep.

Christian: [27:01] Yeah, they're super laid back.

Les: [27:02] Like- There, there's no harm in doing a strategy session with us at all. Yep.

Christian: [27:06] All right, so I g- guess I'll leave it with this. Uh, the other thing you can do to learn more is just go to one of our classes. You can go to beersandhomebuying.com (opens in a new tab). That's beers, beer with an S, beersandhomebuying.com (opens in a new tab). Uh, and you can see all of our free home buyer classes. They're only an hour long, and then we stick around and answer questions for another, you know, 15, 20 minutes. Um, and they're super laid back. We do one, sometimes two a month, and we do them all over the area. So they're generally at restaurants or bars. Um, but you can find them anywhere. Like, we, we have them all over the place. So just go to beersandhomebuying.com (opens in a new tab) to see when the next upcoming class is. And if you, uh, want to attend, again, they're totally free, and you get some free beer. So it's a great way to learn how to buy a house. That's it for this week. We will see you in two weeks on the Awesome in Seattle podcast.

Reed: [28:00] Bye. Bye,

Les: [28:01] guys