Increasing mortgage rates are unpreventable, and have an impact on how you, as a buyer, will purchase your dream lake home. Lake Homes Realty’s CEO, Glenn Phillips, shares five need-to-know factors involved with the rise in rates.
Less DIRECTLY Important: Depending on the size of the mortgage, it can affect the amount of home you can get for the same monthly cost.
Investment Sense?: Buyers are more likely to take out a mortgage for a lake home now when interest rates are still low, and pay it off with ‘cheaper dollars’ in the future as rates increase.
Slow Price Appreciation: No matter the market, lake homes need to be priced appropriately, especially as rates rise. Not many buyers will continue to be enthusiastic to pay such high prices.
Do Not Solve Inventory Shortage: Rising interest rates will not be enough to stop the lake home shortage. This means that although buyer competition has slowed, it hasn’t stopped completely.
Expertise Still Matters: Ensure you are still making a smart investment in this shifting market with the help of a lake real estate expert.
The market is ever-changing, and knowing what to expect can help you make smart investment decisions. Having a lake real estate expert who knows how to guide you through these rising rates will ensure a smooth buyer experience!
Choosing a real estate agent without properly vetting them will be your demise when buying or selling a lake home. Lake Homes Realty’s CEO, Glenn Phillips, shares five questions you need to ask when searching for an agent.
Are All Agents the Same? Of course not. The first step is to exclude the ones you don’t want so that you can choose from the ones you do.
What is MY Goal? When considering your goals, decide what’s most important to you. Is it maximum profit? Do you want to stay in your home for as long as possible before you sell? Answering these questions will help you develop a game plan.
Which Agent is Most Capable of Helping Me Achieve My Goal? Find an agent who is particularly skilled in your goal criteria. One may excel at listing your property, but another may be more skilled in buyer relationships.
Which Agents are Focused on LAKE Real Estate? The difference between selling on the lake versus a primary residence is considerable. Find an agent that understands the nuances of lake real estate.
Which Agents can Provide a Pipeline of Out-of-Town Buyers? Most of your potential buyers’ pool will come from out-of-town residents. You need an agent who can prove they have connections to buyers across the nation.
You need a skilled lake real estate agent on your side when buying/selling your lake home. Before you begin your search, be sure to have your specific goals in mind to ensure you are matched with the right one.
At Lake Homes Realty, we’re always talking about finding your dream home. We emphasize the importance of connecting with local real estate agents who have national expertise to guide your personalized search. Part of what our agents do so well is tailor their recommendations to what you’re looking for. A lake home for retirement? A lake area with a lot of families? We can help. We’re here to help you circumvent common buyer mistakes and help you pick a lake home that suits you.
In finding this dream home, a common mistake that buyers make is overlooking the importance of a lake community’s culture. A buyer may think that a neighborhood checks off all their boxes, but they forget to assess the cultural feel of the lake community. To understand more about this topic, we talked with Katie Severance, real estate agent and author of The Brilliant Home Buyer. Through her insights, we’re here to share some important ways to be a smarter buyer and find the right lake community for you.
When looking for a lake community, it’s tempting to assess the area based on what features already exist. However, communities are constantly changing, and it’s more helpful to assess the community fit based on the trajectory in which the area is headed. Katie says, “See if there’s going to be an arrival or expansion of a nearby university, park, hotel, hospital, anything that’s coming soon. Nothing will have more of an impact on your home than the value of a community.” If you’re looking to live in a lake area with an up-and-coming lively scene full of amenities, ask about these expansion plans.
You can tell a lot about a lake community by how it’s run. A lot of homeowners bypass this consideration, but Katie encourages asking yourself: “If there’s an HOA and town council, are they dysfunctional? Do they get along? Are they running efficiently?” One way to investigate this is by asking for six months’ worth of minutes from the local town hall. Not only will you determine how well-run they are, but you’ll also get insight into what issues are prevalent in the community. Katie also advises getting a copy of their bylaws, rules, and regulations, if they exist. This will tell you how you’re allowed to use the water, and what the restrictions are in terms of access and land use.
Another important consideration to look for in these minutes is indicators of the town’s politics. “A lot of communities skew one way or the other,” Katie says, “If you’re a liberal in a conservative area, you’re going to be unhappy.”
If anything bad has happened in your potential neighborhood (e.g., environmental concerns, crime issues, etc.), chances are, it would be reported in the newspaper of the nearest town or city. “Put the town in quotes in Google,” Katie advises. “A real estate agent isn’t allowed to talk with you about crime, and they also don’t have to tell you if someone died in the house.” Googling these potential issues in the news will help cover your bases.
Another great tool is social media. In addition to asking the realtor what the culture of the community is like, Katie suggests using social media “to see how people talk to and treat each other.”
One of the best ways to learn about your lake community’s culture is by getting to know your neighbors. Use Facebook groups to check in with people who live there, let them know you’re looking to buy a home, and ask your questions. Another neighbor-related consideration is checking what percentage of homeowners are year-round residents. “In a co-op, the value of the building is higher if they are owner-occupied. At a lake house, this isn’t quite the same, but you might have renters who are loud and obnoxious,” she explains. “If it’s a giant lake VRBO, that wouldn’t be a good choice. It’s a really hard thing to remedy.”
In your search for your dream lake community, be sure to contact one of our lake agents who will help personalize your search.
Now that fall is officially here and winter is approaching, Lake Homes Realty’s CEO, Glenn Phillips, explains why now is the best time to purchase your dream lake home!
1. Summer Enthusiasm Has Faded: Now that summer has ended, the initial wave of enthusiasm has worn off. This will prompt more homeowners to list their lake homes.
2. Winter Water Levels: You’ll get insight into the water levels of the lake during the fall and winter seasons. Seeing it firsthand can make all the difference.
3. What is Open Year-Round: You can see how active this lake is during the fall/winter seasons. Are shops and restaurants still open? Are events still happening?
Although the fall/winter is typically considered the ‘off-season’ for lake homes, it may be the perfect time to buy one. Visualizing your dream lake home setting in every season can help you make the right purchase!
Lake Homes Realty’s CEO, Glenn Phillips, gives 5 need-to-know tips before purchasing your first lake home. These tips will help you save money and help you understand what to expect when living on specific lakes!
1. Shoreline Requirements: These requirements vary by lake areas which can, in turn, determine certain limitations such as what you can build, removal of vegetation, etc.
2. Dock Requirements: Some lakes have specific requirements concerning the addition/alteration of docks to your lake home, so do not assume anything goes.
3. Water Level: Understand how the water levels change on your lake because it can determine the height of your dock, the time of year/day you fish, etc.
4. Water Quality: Knowing the quality of lake water, clarity, for example, can give you clear expectations of how it’ll appear year-round.
5. Lifestyle: Determine the type of lifestyle you’d like to live on the lake, whether quiet or active, as it will help you decide which lake and where on the lake to buy property.
Doing your homework before purchasing your dream lake home is essential! It’s better to understand what to expect before making such a big commitment.
You can never be over-prepared when buying your future lake home. Lake Homes Realty’s CEO, Glenn Phillips, has four tips for buyers in this hot real estate market that you’ll want to check out before you make your next offer!
Easy to Understand: When making an offer, ensure that it is easy to understand. Making it too complex can confuse the homeowner and their agent.
Ready Cash: Having plenty of cash available can help you stand out against other buyers with loans. Sellers feel more secure with cash offers because of the added security.
Improve Credit Score: Improving your credit score beforehand will help with your buying power. It can help with loan approvals and lowering interest rates.
Follow Seller’s Rules: Be sure to follow the rules of the seller when showing interest in their home. Failure to do so can cause your offer to be overlooked.
Buying a lake home shouldn’t be complicated. Following these four tips can help ease the process, and give you a better home buying experience.
Did you know that many lake homes are built on leased lots? In this video, we demystify what misconceptions you may have in regards to leased lake lots.
Shoreline Ownership. Oftentimes, lakes are owned by public or private utility companies, the Corp. of Engineers, the Tennessee Valley Authority, etc. Because of this, lots on these lakes are leased.
Lease Duration. Leased lots typically have long terms. It’s not uncommon to see durations range anywhere from 25 to 99 years. Because most homeowners don’t own their lake homes for more than 20 years, these long-term lease durations are factors that lake home buyers must consider when purchasing or building a home on a leased lot.
Mortgage Impact. Getting a mortgage on a leased lot is not unusual and happens quite often with lake homes. But one of the concerns that potential lake homeowners could encounter is how the mortgage term could impact the lease term duration. For instance, a lender may not approve a 30-year mortgage for a lake home that is on a 25-year lease.
Finding your dream lake home isn’t easy. Sometimes, you’ll have to sacrifice certain “nice-to-haves” for the sake of securing your “non-negotiable” qualities in a lake home. However, the solution to attaining your dream home might be to create aspects of it yourself. Investing in a fixer-upper can be an excellent opportunity to customize a home to your liking and increase your return on investment for an eventual sale. Plus, there are plenty of DIY solutions to fixing up a property. Check out these insider tips on buying a fixer-upper lake home from real estate experts across the country.
Whether it’s a lake property or a residential home, every buyer should know their numbers. “Run your flip like a business — because it is!” says Charlie Mackey, director of investment solutions at Sundae. “Start with the 70% rule. You should not pay more than 70% of the After Repair Value (ARV) of a property or what the house can be sold for after completing all work and renovations. Think of this number as a starting point.”
Knowing your numbers can help eliminate any cost surprises in the long run. It can also help you decide if a property is worth the money. “You’ll never be 100%, but you can be as close as possible,” says Bill Samuel, a residential real estate developer who specializes in rehabbing and selling houses. “Know what your total development cost will be at the end of the day. The most important thing is: what’s the property going to be worth when you finish, and is that number versus your total cost worth it?”
Look for the Bones
When you’re buying a fixer-upper, it’s not the inside that counts — it’s the structure. You’ll be renovating the interior, but you want to make sure the overall frame of the home is sound. “Look for the bones,” says real estate expert Steve Laret. “Look at the dock, pilings, roof, walls, the stuff that isn’t ‘sexy money’ to spend.” If everything on the outside of the home is intact, including the electrical wiring, plumbing, and a termite inspection, then you can spend your money on aesthetics alone. “Run away from a place that needs a new roof, tons of tree work, or is completely shaded. They are not going to return your investment,” he says.
These days, buyers are savvier than ever. However, it doesn’t hurt to get a second opinion — especially one who’s an expert. “Don’t be afraid to have a contractor walk a property with you,” says Henry Washington, a real estate investor who specializes in buying and renovating homes. “A lot of times, people THINK they know how much a renovation will cost, but they don’t actually know. The expense of fixing foundations can be cheap or expensive, and it’s hard for an expert to know the difference. Have a professional give you a quote.”
In particular, a contractor may help you search for things like cracks in the walls that you might not notice. These could indicate a problem in your home’s foundation, and you may want to offer less for the property.
A contractor can also offer insight into the home’s electrical wiring. “If you’re not experienced with doing a lot of construction, stick to a house that wasn’t built over 100 years ago because you’re going to wind up with way too many surprises,” says Samuel. This is because 100 years ago, there were no building codes for electricity.
If your house is too old and is not up to code, you will be responsible for the costly fees of updating the wiring if you were to open a wall. Bringing a contractor on-site could help you catch things like this — the little things that come with a hefty price tag.
After buying a fixer-upper, you’re going to be doing a lot of the work. Be prepared by knowing what you’re working with and looking for the home’s potential rather than evaluating it based on its current state. For lake houses, adding bedrooms means adding value because you will be paid more whenever you rent it out or if you want to sell it one day. “Look for places where the square footage and the number of bedrooms don’t add up,” says Washington. “That means that you can add a bedroom and still have a great-sized home.” At a lake house, you may also want to take down trees to increase the lake view. However, this can be expensive, as Laret warns. It may be a better idea to consider other ways to let light into your home, such as changing the window treatments.
Finally, when buying a fixer-upper on lakefront property, be sure to hire a lake-focused real estate agent. “Hire someone locally who knows all the nuances of the lake market,” Samuel says. “Know what the water quality is like, and other important factors about that lake. The more information you have, the better your decision will be.” At Lake Homes Realty, our lake agents have both local and national expertise and can help you find the property and lake area that’s right for you.
When you are considering buying a lake home, particularly in a rural area, here are 4 “Gotta Haves” you will have to keep in mind.
Cell Signal
Internet Access
Television Service
24-Hour Emergency Room
There might be hundreds of miles of lake shoreline, one side of the lake might have these services while the other side might not. Also, the terrain of the lake areas might determine the availability of these services as well.
Our knowledgeable agents are here to help you answer these questions and assist you in your lake home-buying journey.
