You May Need Noah's Ark One Day

Flood Insurance Rate Hike Imminent

More than 1 million home owners living in older houses along the coastlines and riverbanks of the United States are preparing for federal flood insurance rate hikes effective Oct. 1 under a law passed in the wake of devastating storms.

Congress passed the law in an effort to balance a $24 billion deficit in the National Flood Insurance Program, which had growing losses from Hurricane Katrina in New Orleans in 2005 and earlier disasters. The rate increase is designed to make property owners pay for the true risk of living in high flood hazard areas, including coastal areas of Florida, New Jersey, New York, Texas, and Louisiana, and inland states prone to river flooding.  Members of Congress from high-risk flood states want to delay the higher rates so they can gather more information on the impact on property owners, but with next Tuesday's deadline, time is running out.

The act requires the Federal Emergency Management Agency to phase out insurance subsidies enjoyed for decades by owners of homes that were built in high-risk flood zones before the creation of the original federal flood insurance rate maps and building standards, which in most communities occurred in the 1970s and 1980s.

The act comes on top of a nationwide remapping of flood zones, which in some coastal areas has moved some properties into newly widened hazard zones, exposing them to rate increases.  More than 80 percent of the 5.6 million properties nationwide covered by the $1.12 trillion program already comply with existing standards and would not see any change in their policies, at least for the time being, FEMA director Craig Fugate told a hearing of the U.S. Senate Banking, Housing and Urban Affairs Committee on Sept. 18. He acknowledged that the rates of those homeowners in compliance could go up, too, if new maps reveal higher flood risks.

If you have any questions, feel free to contact James Y. Kuang at (626) 371-5662 or by email -james.kuang@coldwellbanker.com

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Source: "Coastal, Riverbank Homeowners Brace for U.S. Flood Insurance Hike," Reuters (09/24/13)

Be A Psychic, Read Some Minds

Once upon a time I took a psychology class.  I expected to be able to read people’s mind if I am in contact with them after I complete the course.  Well, immediately the instructor made it plain and clear to everyone in the class what the results will be.

“You will not be able to read anyone’s mind after this class.  It wasn’t what psychology is about”

First of all, why would I, or anyone want to read people’s mind?

For me it was simply just having that advantage of knowing what someone’s next step or plans are so I can take the initiative.  It’s pretty much similar to knowing the future.  Imagine you know what tomorrow’s winning lottery numbers will be?  Wouldn’t that be something to dream about.

So, same concept if you can read a seller’s mind, you gain an advantage, or know better than to bother with them.  Well, I have worked with sellers representing them, and still dealt with sellers when I am representing with buyers.  Working with sellers have allowed me to pretty much read their mind.  They mainly have 3 ways of thinking that will determine their decisions.

1.) MONEY MONEY MONEY - These sellers only have money on their mind.  Their sole purpose of selling is to make a profit.  They don’t want to hold on to their property but they do have to sell at a certain price or else they take a loss.  If worse comes to worst, they would have to take a loss of course.

2.) TESTING THE WATER - These sellers don’t really have an urgency or need to sell.  I mean the idea of what they can do after they sell their property has tickled their dreams but not enough to motivate them to be serious about selling.  However, they figure if they can and only if they can get an “X” amount of dollars, then they wouldn’t mind selling.  Otherwise, they will continue with what they are already doing with their home, whether it be living in there or renting it out.  This is where you see expired listings and they never try to sell again.

3.) LIFE EVENT - It could be a job, family, or just want a new life that motivates these sellers.  These sellers are the serious and motivated sellers you want to work out a deal with.  They need to sell and are much more likely to work with you.

Ultimately every seller is selling so they can move on to their next step in life.  Some are more urgent and serious about it than others.  What you know about a seller can give you a winning edge.

So, if you are selling, would you want a buyer to read your mind?  Let me help you cast a spell on buyers to make them pay top dollar for your home.  Let my “demand creation strategy” do the trick for you and no buyer will bother trying to read your mind.

Either that, or have me help you buy your next home and I will read the sellers mind for you so we can strategize!

By The Way...if you know someone who would appreciate the personal service I provide and is thinking of buying or selling a home I'd love to help them, please call or email me with their name, number and email address and I will be happy to follow up with them for you.

If you have any questions, feel free to contact James Y. Kuang at (626) 371-5662 or by email -james.kuang@coldwellbanker.com

www.cbprosperity.ca
www.facebook.com/JamesYKuang

Exposing Real Estate Disclosures For What They Really Are

Most of the times real estate disclosures aren’t taken seriously enough by the buyer or seller.  They really do protect both the buyer and seller.  Disclosures can cost both parties thousands of dollars if not taken seriously.

By law, sellers are required to disclose all known defects regarding the property and buyers will have the right to approve what the sellers discloses and thereby move forward with the purchase of the home.  However, what most sellers do is mindlessly mark down that they don’t know about anything down the line for every section.  This can be dangerous for a seller especially if they know there is a defect with the home and knowingly or mistakenly, in writing say they don’t know about it on the disclosure statements. 

Will the buyer know about it right away?  Nope, they will have no idea until they feel the effects of  whatever the defect is.  However, what a buyer can do is go after the seller for failure to disclose what they do know since by law that is a seller responsibility.  The seller will then be responsible for the repair and end up having to foot the bill since the defect was known and not disclosed to the buyer.

In a real life situation, my client, George, bought a home and a few weeks later he discovered a major leak.  The seller had failed to disclose this and he was easily able to prove that the seller had knowledge of this and didn’t disclose because the leak stains were covered up in paint.  The seller had intent to hide this problem.  This is not the way for sellers to go.  In real estate as well as in life, it is always better to be honest in everything we do.  The seller had to foot the bill and take care of it.

Buyers in turn need to understand what it means to approve all the disclosures.  Pretty much as long as a seller discloses a defect and you approve it, the seller is off the hook for that specific defect.  If a seller tells you there’s a hole in the roof where rain water pours in, come Winter when that rain pours through that hole in the ceiling, you can’t go after the seller after it has been disclosed to you, and you okayed it.  So make sure you understand what’s disclosed before approving it.

Don’t expect too much out of a disclosure either.  Sellers are only required to disclose to you what they actually know.  They aren’t responsible for investigating further or paying for a professional to look into the home.  You would have to get inspectors on your own which is why a professional home inspection is always recommended.  I will go more into that another time.

Simply put, it’s like buying a car and the seller tells you it can go from 0 to 60 mph in 3 seconds, and there are minor damages to the brakes on the right side of the car, but the seller hasn’t driven the car in 5 years and that is honestly to the sellers best of knowledge.  The info may be wrong, it may take 15 seconds instead of 3 and all the brakes are do not work at all, but the seller has performed the required seller duties by disclosing what is known best to their knowledge.  Nothing more is required.  The seller does not need to pay for a professional to verify anything for you.  You are however, allowed to do your own investigations and verify all aspects of what you are buying on your own.

Real estate disclosures in a nutshell works exactly like that.  So next time you are dealing with real estate disclosures, take them seriously.



If you have any questions, feel free to contact James Y. Kuang at (626) 371-5662 or by email - james.kuang@coldwellbanker.com

www.cbprosperity.ca
www.facebook.com/JamesYKuang