Brick Underground’s Buy Curious column recently turned to Neeta Mulgaokar, an Associate Broker for Mirador Real Estate, for her expertise on buying property. The column weighed the pros and cons of the question, “Should you buy a home with a tenant in place?” As Neeta explains, the answer depends on a number of factors regarding the apartment, the tenant, and the purchaser. Here, she explains the potential advantages of saying “Yes”:
“If the property is an investment, a tenant in place could be fantastic,” says Mulgaokar. That obviously depends on “what terms the tenant has agreed to and whether the tenant has a history of being a quality tenant,” she says, explaining that “quality is objective and depends upon whether the tenant has historically paid rent on time, followed the building’s rules, and/or maintains the condition of the apartment.”
Furthermore, Mulgaokar says that “an investor should analyze whether these criteria are being met in addition to whether the tenant is paying market rent. If the rent is under market but the quality of the renter is high, the investor should make a cost-benefit judgement call as to what is most important in the long run.”
When most people move apartments they imagine something bigger and better, unfortunately that’s not always the case. Sometimes apartment moves are a result of a split with a partner, career demotion, or some other less-than-ideal reason, that represents a personal setback.
Mirador Real Estate’s Health and Wellness Consultant Dr. Lynn Saladino spoke to the Brick Underground about ways to transition to a new not-so-perfect place. She said, “a lot of times it feels like this new place will represent the lifestyle you’ll have for the rest of your life, but it’s important to remember this is a for a year or two,” says Saladino, “Put a time limit on how long it’s going to be, and realize you can revisit it next year.” To read all of Lynn’s tips, check out the full article here.
In real estate, a contingent offer (also known as a contingency) is a purchase offer in which certain conditions must be met for the deal to go through. For example, if a buyer wants to purchase a house but has to sell her own apartment first, she can make a contingent offer to the seller, asking the seller to take the house off the market until she raises the necessary funds. If she doesn’t meet a given deadline, the deal can be canceled, and she may even face agreed upon penalties.
Contingent offers are relatively rare in a seller’s market, but Brick Underground reports they are becoming increasingly common in New York as the market slows down: “Contingent offers haven’t been seen much lately, given how hot the market has been—sellers could always find other takers—but some attorneys and agents report that they’ve been making their way back into the fray, signaling what could be a rebalancing in the market.”
To find out what forms contingent offers can take, Brick Underground spoke with Mirador Real Estate’s Chad Thomas, who explained how sellers can protect themselves from buyers who can’t hold up their end of the agreement:
One solution? A reasonable monetary compensation, say a promise to cover what’s called the carrying costs of a property—maintenance and utilities, for instance—for each month the seller has to wait for the buyer to make good on the sale. (The agreed-upon compensation doesn’t have to be tied to carrying costs, of course, but it’s a good place to start.)
“If the buyer is strong, and their contingency is specific to an appraisal or an amount, then the seller’s risk can be mitigated and they can probably move forward (obviously after agreeing on all the other basic terms),” says Chad Thomas of Mirador Real Estate.
Chad also offers advice for buyers who seek a mortgage consistency, in which either party may cancel the sale if the buyer is unable to secure a mortgage:
From the buyers’ perspective, Thomas suggests those who are risk-averse and want mortgage consistencies to offer to forfeit a portion of the contract deposit—as opposed to the entire amount—”if it’s a highly desirable property or a competitive buying environment.” This way, there’s some skin in the game, so to speak. “It’s a way of showing the seller that they’re willing to do everything possible to close,” explains Thomas.
CONSIDERING A GROUND-FLOOR APARTMENT? HERE’S WHAT YOU NEED TO KNOW
Starting to despise the hike up the stairs to your third-floor walkup? Ground-floor units starting to look appealing? Mirador Real Estate tells you everything you need to know about life on a building’s main floor in this week’s Buy Curious.
I’VE BEEN HIDING A CAT FROM MY LANDLORD. SHOULD I RENEW MY LEASE, OR LEAVE BEFORE I GET CAUGHT?
by Virginia K. Smith | 9/16/15 – 10:30 AM
We often receive emails from readers asking for help in navigating their own real estate crises. In Realty Bites, we try to get them answers.
“My landlord and lease specifically say no pets, but I’ve had a cat for the past 8 months, and no one has noticed or complained. I’m up for renewal this winter, however, and they’ll likely want to inspect when I re-sign. Should I re-sign and hide the cat; try to negotiate since it’s been here without causing problems; or stop pushing my luck and find a new place?”