All Forum Posts by: Greg Powers

“Realty” is fine.  You can’t use “Realtor” because it’s a trademarked name.  (It’s officially REALTOR®.)  But questions like this should always be posed to your broker.

@Robert C.

Brainstorm…

Connect with a music promoter and rent it to bands passing through. Contact a film company location manager and see if anyone needs something like that for a set. Any nearby races—triathalon, bicycle, etc.—or rallies that could use it as a way-station? Does the local fire department need a property to practice on? Overflow housing for a homeless shelter or recovery non-profit for veterans?

Hi Benjamin.  There IS a standard NH lease and if you want to message me with your email I’ll send you a copy.  But you’d probably want to add some clauses to suit your own property or landlording situation, and if you do, you’d want an attorney to review it.

But I would also encourage you to view your lease as one of your most important investments.  You can cheap out on paint or light fixtures, but it’s foolish to do so with your lease.

@Alan F.

Never underestimate an angry neighbor.

https://www.npr.org/sections/money/2021/08/24/1030151330/a-unicorn-startup-is-turning-houses-into-corporations

Ahhh, the old buyer agent discussion.  :)

Two things to keep in mind about all of this (and some of this may vary by state).  First, the seller does not pay the buyer agent's commission, no matter what anyone says.  The listing agreement that the seller signs specifies the commission that the seller will pay to the listing agent's firm.  Period.  That's the listing commission.  

The listing agent or the listing agent's firm then decides how much of a fee they will offer to other agents as an enticement for them to show the property, and the seller typically has to agree to it on the listing agreement--that's generally referred to as a co-broke fee.  But that's a FEE paid by the agent, not a COMMISSION paid by the seller.  Yes, the fee comes out of the listing agent's commission, but the seller does not compensate the buyer agent, the listing agent does.

So legally, if a seller agrees to pay their listing agent 5 apples, they owe the agent 5 apples whether another agent brings a buyer to the transaction or whether the buyer comes directly to the listing agent.  (PRACTICALLY speaking, some listing agents will agree to reduce the commission if they don't have to pay that co-broke fee, but why should they? They're doing more work if the buyer doesn't have their own agent.)

Now, if you, as a buyer, hire a Buyer's Agent, you will be signing an agreement that says how much you will pay your Buyer's Agent for a successful transaction, regardless of what the co-broke fee might be on any given property.  Let's say your agent is amazing and they charge their clients 3 apples.  You will owe them those 3 apples whether the listing agent is offer a co-broke fee of zero, 2 apples, or 3 apples.  Usually the Buyer Agency Agreement will state that any co-broke fee offered by a listing agent or firm will be credited against the fee you owe your Buyer Agent--but again, that does not mean the seller or listing agent is paying your Buyer Agent fee.  So if the co-broke fee is 2 apples and you've agreed to pay your agent 3 apples, your closing costs will include the 1% difference that you will owe your Buyer Agent.  And yes, before you submit an offer on a property your Agent should tell you what that co-broke fee is and whether you'll be obligated for any difference if you purchase that property.

Why would any sane buyer agree to do that?!!

Because if you're working with a real estate agent who you have not hired as a Buyer's Agent, they owe you nothing because you're paying them nothing.  (In New Hampshire, they're known as a Facilitator).  In that case, the listing agent is compensating them with the co-broke fee--if that co-broke fee is 1%, that's what your agent gets; if it's 3%, that's what they get; if it's zero (as some builders are doing now), your agent is SOL.  And the degree of service you get is minimal--they're just opening doors and handing you paperwork.  

Once you hire them as your Buyer Agent, they now owe you several fiduciary duties, including loyalty (meaning they have to keep your best interests above their own and others whom they don't represent), confidentiality (they can't tell a seller or seller's agent anything about you that would compromise your negotiating position), and disclosure (meaning if they know anything about a seller or a property that could help you, they must tell you).  But if you don't hire them as your Agent, you're not entitled to any of that.  And yes, you can hire a Buyer's Agent for a specific property, or any period of time (as long as the agent is willing to do it).  

Personally, being an Exclusive Buyer's Agent allows me to provide much better service to my clients, so I insist on it, even if it's just for a single property.  But I make sure people understand the distinction between a Buyer Agent and a Facilitator when I first meet them, in terms of service and compensation; I tell them not to hire me until we've gone to see a few properties and they decide if they like and trust me; and I give them a service guarantee that says if they aren't happy with me at any time, they can fire me.

I understand the investor mentality that "whoever brings me the deals is who I work with," but are you really better off working with and paying a great Buyer Agent than hoping a herd of mediocre agents will lay dead mice at your feet?  You get what you pay for.  If you want to vet an agent before deciding to hire them, call their broker and ask for a list of all their transactions in the past 5 years (keeping in mind that longevity is no guarantee of quality, and inexperience does not necessarily indicate a lack of quality). 

And to whoever suggested that agents should get paid an hourly wage, I say, Hell yes!  Sign me up!  I'd be filthy rich right now if I got paid by the hour.
  

If the property is older, like many in the northeast, and if it's on public water and sewer, I would strongly recommend Service Line Coverage.  That will cover water pipes coming in and sewer lines running out.  I live in Manchester, NH and some of the sewer pipes are a hundred years old.  One of my past clients had to replace their sewer line at a cost of $20,000.  It can be one of the most expensive capital expenses you'll run into, and it's not always easy to diagnose during an inspection.  You can have a septic company run a camera down the line to check for collapses, tree roots, etc., but the coverage is relatively inexpensive relative to the potential cost of the fix.

@Carmella Lombardi, instead of asking if they want to sell, ask them what their plans for the property are. As soon as you ask about selling or buying, you create an adversarial relationship with competing interests—buy low, sell high. Phrasing it that way allows you to just start a conversation and uncover their motivation, or lack thereof. Don’t forget to ask if they own any other properties, too!

If you plan to do a lead test and make the purchase contingent on the results, or plan to negotiate any results, make sure you check off that inspection contingency on the Purchase & Sale Agreement.  If you don't, there's no contingency.  That Lead Paint Hazard Disclosure you're checking off and signing has no contractual weight--it's just a disclosure.

A full-blown lead test by a licensed lead inspector will check subsurface layers of paint and it's fairly expensive (I was quoted $700 a few years ago, but it may depend on the size of the property). Since, generally speaking, lead paint only poses an immediate hazard if it's on the surface, or if there's peeling and chipping paint and subsurface layers are exposed, if you want to go the cheap and easy route you can get a $10 lead paint test kit at Home Depot and check various surfaces (just keep in mind the contractual contingency may only apply if the testing was done by a professional, according to the standard verbiage in the NH P&S). If it was recently renovated, I would guess that includes new paint so most likely any surfaces would have been painted over (i.e., encapsulated).

If you're already under contract for the condo and you didn't check off the Lead Paint inspection, the Home Depot test might be the way to go.  As someone above mentioned, if you rent to someone with young children and they test positive for lead poisoning, the consequences are complicated and expensive.  Better to know than not know.  But as stated, if you know and you do nothing about it, it will make the condo difficult to sell in the future.

New Hampshire does have several programs to help with the cost of lead abatement.  If you visit https://www.dhhs.nh.gov/dphs/b... and look down and to the right, there are links to several of them there.  You can also find links to lead inspectors and contractors there.

Hi Esther!  I will DM you with a recommendation.

I'm in a few national Facebook groups for Realtors and yes, the market is pretty crazy everywhere.  I've seen a few posts suggesting that agents are starting to see a shift in some markets, but I have the feeling it's more likely they're seeing the typical summertime lull and wishing it were a more substantive change.  But it's hard to define a shift unless you're looking backwards and reading trailing numbers (average days on market, list-price-to-sold-price ratio, etc.)--all you have is anecdotal evidence while you're in the midst of it.

Unlike 2008, the current market really is a product of supply and demand.  You could argue that there are larger (and darker) forces creating that demand by holding interest rates artificially low, but you can't argue that low interest rates bring lots of buyers into the market.  There are a few other forces boosting that demand as well, including ever-increasing rents (which lead people to become owners instead of renters), the ability to work remotely (which in NH has created an influx of people from more expensive neighboring states), etc.

On the supply side, inventory had been on a downward trend for at least the past three years, and the pandemic exacerbated the problem.  There was no Spring market last year, when we usually see a jump in inventory.  We did see it this year, but in the 3 counties where I do most of my business (Hillsborough, Rockingham, and Merrimack), the Median Days on Market since February has remained at about 6 days.  In other words, half of all houses are selling in less than a week.  What's most interesting to me, if you look at the chart below, is that even as inventory climbed this Spring and into Summer, the Average Days on Market dropped.

Those numbers are for single-family homes, and you're looking at multifamilies, but I could probably show similar stats for multis in NH.

Given that it's a supply-demand squeeze and not some distortion in the market (like easy credit), I only see two reasons the market will really shift: a decrease in demand, and an increase in supply.

The shortest route to decreased demand would be a rise in interest rates.  They might go up, but they could go up to 5% and still be at a historic low, so that should trim some demand but not erase it enough to cause a crash.  And if they start to rise, that frequently creates more demand as people who have been thinking about buying decide "It's now or never."  Also, if prices are pushed downward by a rise in rates, affordability is not affected too much in the long run.

Supply might also go up, but when every house that's listed is getting 10 offers, you could triple supply and still not satisfy all the demand, and I don't see that happening any time soon.

All of which is to say, I wouldn't wait around for a crash any time soon, and if there is one, you may have other problems to worry about.  I tell my buyers that it's not always about price--there are around 32 blanks on the NH Purchase & Sale Agreement, and only one of them is price.  Sometimes other terms you include, as well as the type of financing you're using, can win the day.  So make sure you're getting the best advice you can from your agent about how to get an offer accepted, and keep after it.