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First-Time Home Buyer Confessions: ‘How We Beat 32 Offers and Got the House’

October 21, 2020

first time home buyer

Julie Migliacci

First-time home buyers have it harder today than ever. Caught between high real estate prices, low housing inventory, and a pandemic that has many of us nervous about leaving our house, home shoppers might be wondering: Is it even possible to buy right now—and how?

If you’re curious about what it takes to purchase property in today’s marketplace, look no further than this new series, “First-Time Home Buyer Confessions.” We’ll profile home buyers who’ve successfully navigated a variety of obstacles to close a real estate deal during these challenging times. We’ll also hear what they’ve learned in the process that might inspire other hopeful first-time buyers to get out there and follow in their footsteps.

Our first tale from the trenches comes from Julie Migliacci, a virtual events planner near Boston, and her husband, Mark, a banker who specializes in affordable housing. In June, they beat out 32 other offers (yes, 32!) and purchased a 1,627-square-foot, three-bedroom house in Wakefield, a Boston suburb. Here’s how they pulled it off, along with the many mistakes and lessons learned along the way.

first time home buyer
The Migliaccis paid $50,000 over asking price for their first home.

Location: Wakefield, MA

House details: 1,627 square feet, 3 bedrooms, 2.5 baths

List price: $599,000

Price paid: $650,000

What made you decide to buy a house in the middle of a pandemic?

Three years ago, Mark and I moved from New York City to Boston and rented a 900-square-foot apartment in Belmont with our two daughters, Chloe and Rose.

We’d always known we wanted to buy a home. But once COVID-19 hit and we were all working and schooling from home, our tiny apartment felt like nothing anymore.

At one point I looked at my husband and said, “I love you, but I really don’t like being with you right now.” So we agreed to put our house hunt in hyperdrive.

first time home buyer
The Migliaccis’ rental, a second-floor apartment in Belmont, MA, was affordable enough that they were able to save to buy a house.

Julie Migliacci

How much did you put down on the house—and how’d you save for it?

We put down 20%. We’d been saving for three years. We’d made sure our rent was low enough that we could really sock a lot away. We could have paid higher rent for a bigger place, but wanted every extra cent we had going to our house fund.

The Migliacci daughters, Chloe and Rose

Julie Migliacci

What were you looking for in a house?

COVID-19 definitely shifted what we were looking for in a home. We always had a goal of finding a place with about 1,700 square feet. But now I found myself wanting a yard more than ever. I’m a city kid, so originally I never thought that was something I needed. I also wanted to find a house that was close to the city, in case we ever needed to commute back in.

The back of the home with a large yard.

How many homes did you see in person?

Starting in April, over the course of five weeks, we visited about 10 homes—alone, in masks, with plenty of hand sanitizer of course. With COVID-19, there were no open houses.

How many offers did you make before you had one accepted?

We put in offers on five different houses.

Why do you think your first four offers didn’t pan out?

At the beginning, we had this HGTV idea of what a home-buying experience would be like. We thought we’d go $10,000 above asking and be fine. But what we realized is we weren’t even in the running. It was a waste of time and paper. I was surprised at how competitive the market is right now because of COVID-19. We kept making offers on houses after seeing them for just a few minutes, and we still kept getting outbid. I guess you could say our learning curve was steep.

Every time we got denied, we asked who won the house instead. The offers that kept winning were those that waived all contingencies. So we did what everyone tells you not to do: We waived the financing contingency and the home inspection in order to even have a shot. We crossed our fingers, read all of the disclosures very carefully, and hoped it would all work out.

How did you know this house was the one?

We thought this house was nuts! It has a two-story rock formation out front that, at first glance, looked like a death trap for my two kids.

The rock formation at the Migliacci home

Julie Migliacci

At the time we put in an offer, we’d actually had an offer in on another house as well. That house checked all the boxes, but needed a bit more work. This house, despite the rock, was move-in ready.

As we waited to hear back on these offers, we actually tried to talk ourselves out of the house. We kept saying, “It’s an empty-nester home, not a home for a family.” And then, of course, that’s the house we ultimately got. We’re really happy, though. It’s definitely our dream home now.

first time home buyer
The Migliacci family all smiled when they first entered this home.

Julie Migliacci

How’d you manage to beat out 32 other offers on this house?

I don’t know honestly! In addition to waiving contingencies, we were very aggressive with our price point, offering $50,000 over the asking price. And that wasn’t even the highest offer!

It may have also helped that I wrote a very heartfelt letter to the sellers. I wrote letters to every house we put an offer on, where I described a tiny detail that I thought would resonate with the owners. For the house we ultimately bought, I wrote a letter where I joked that our whole family smiled when we first walked into the home, except for our fish. My husband was against using that line, but I think it worked!

first time home buyer
Their heartfelt offer letter may have helped them get the house.

Julie Migliacci

What surprised you about the home-buying process?

I think it’s crazy that we’d see a house for five or 10 minutes before deciding to put in an offer. With houses staying on the market for a matter of days or even hours, we knew we had to act as fast as possible.

Yet after our offer was accepted, the process slowed down, a lot. We closed in 30 days. I was surprised that it was considered lightning-fast. I wanted to move right away! It takes a few hours to buy a car.

first time home buyer
Although they now have a lot more space, they still sometimes work at the same table—old habits are hard to break!

Julie Migliacci

What’s your advice for aspiring home buyers?

If you decide to buy during COVID-19, I’d recommend doing as much research as possible. Get to know the neighborhood. Because once you find a house you like, you’ll likely have to jump on it as soon as possible.

Some markets right now are aggressive, and if you aren’t ready for that, then it’s going to take you a long time to find the right home. So be ready for a lot of heartache. If you’re crazy enough to be a buyer right now, then that must mean you’re motivated—which is good!

The newest member of the Migliacci household seems to like his new digs, too.

Julie Migliacci

The post First-Time Home Buyer Confessions: ‘How We Beat 32 Offers and Got the House’ appeared first on Real Estate News & Insights |®.

‘I Thought I’d Bought a Home, Then the Coronavirus Hit’

May 11, 2020

courtneyk/Getty Images

Buying a home had always been part of my life plan, and in February, I thought I was almost home free: I’d made an offer on a condo in Philadelphia, and that offer had been accepted. All that was left was to close the deal, which I figured would be the easy part.

Then a little thing called the novel coronavirus came along and threw everything for a loop.

While it’s an unusual time to purchase real estate, I ultimately decided to move forward. But it wasn’t easy, and a lot of the usual steps of the home-buying process had changed. Here’s how I navigated this new reality in real estate, and what I learned along the way.

When I put in my offer, everything was normal

When I first submitted my offer on Feb. 26, everything was business as usual. At that point, the coronavirus was still little more than a side note on the evening news. The thought never crossed my mind that the virus would soon have a significant impact on my transaction.

In fact, for a little while, things seemed to be going my way.

To start, after submitting two previous offers that hadn’t panned out, I had finally managed to snag a unit in my dream condo building, an updated complex in Center City. Plus, of all the units I’d seen in the building—and there were many—this was the sunniest and most spacious.

In addition, the transaction was moving smoothly. I chose to waive my inspections in order to keep my offer competitive. My appraisal had also come back looking more than satisfactory. We seemed to be moving along just fine toward settlement, scheduled for the end of April.

Woman holding keys
I got the keys to my new place.

Tara Mastroeni

How COVID-19 put my real estate deal on hold

But by March 19, Pennsylvania’s governor had declared real estate a nonessential business, meaning that all brokerage offices had to close and real estate agents had to work from home.

Since that time, the real estate industry in my area has been in a state of upheaval. The Pennsylvania Association of Realtors® followed governmental orders and provided guidelines to keep both industry professionals and home buyers safe, but as the virus spread, those guidelines seemed ever-changing.

For me, as a home buyer, this lack of certainty, while understandable, sent me into a tailspin of anxiety: Would my real estate deal even come through?

Originally, I wasn’t too worried. I was told by my real estate agent (who is also my mom) that an exception was going to be made for closings of existing transactions. In addition, her broker was intending to put precautions in place to keep everyone safe, including putting buyers and sellers in different rooms and requiring everyone to use a separate pen.

However, by March 23, the point was moot.

The governor had issued a stay-at-home order for Philadelphia and five of its surrounding counties. Since Pennsylvania doesn’t currently allow for remote closings, that essentially left my home-buying journey in limbo.

How we moved my real estate deal forward

Even though my closing was up in the air, I still did everything I could to move forward as though my settlement were going to take place. Fortunately, my lender was able to work remotely, so I was still able to communicate with my loan processor to gather the paperwork I needed to send my file to the underwriter.

However, because this situation is so unusual, I was left with questions that no one knew how to answer. For example, what would happen to my interest rate if my settlement got pushed back and went beyond the date of my rate lock? Even if I could close the deal, would I be able to move in if the city of Philadelphia was still under lockdown?

Condo view
The view from my new balcony

Tara Mastroeni

In the end, I lucked out. Even though real estate is still considered nonessential in Pennsylvania, the governor did eventually issue guidelines that allowed some transactions to move forward. In particular, any contract that was signed before the stay-at-home order—which included mine—could close.

Inside a coronavirus-era closing: What’s changed

Once I knew my closing could proceed, it was simply a matter of figuring out how to do it while keeping everyone safe.

For example, since my condo building was allowing only owners to enter the building, I had to do my final walk-through alone without my real estate agent. I did, however, use FaceTime with my mom so she could view the space and point out any red flags. Thankfully, nothing cropped up.

My settlement was also much different than it would have been if COVID-19 hadn’t cropped up. Instead of having my whole team of professionals there to support me, it was just me and the title officer at his office. He sat at one end of a long conference table, and I sat at the other. We both wore masks and gloves, and did everything we could to avoid getting physically close to each other as we passed paperwork back and forth. The home seller didn’t even come to the closing; he’d signed his paperwork the day before so he could avoid the office entirely.

Although I was nervous to be in an office building, the exposure levels seemed low enough to be tolerable, certainly much less than I’d typically face entering a grocery store. In other words, it was worth the risk.

I’m now a homeowner, but my journey isn’t over

Once everything had been signed, sealed, and delivered, I faced yet another challenge: figuring out how to actually move into my new home.

While moving is considered an essential service in my state, since no one is allowed in the building except for me, I would have to handle the move all on my own. However, since I have a physical disability, that’s pretty much impossible.

My condo association assured me that it was working on a plan to ease these restrictions so I could move in. Until then, I will be living with my parents—and paying a mortgage on a home in which I can’t live.

Even in the best circumstances, buying a home is a long process. With coronavirus, it’s even longer and more complicated than ever. Patience is key. Even though this is not at all what I pictured buying a house would be like, when I look back at all that’s happened, I still think: Was it worth it? Absolutely.

The post ‘I Thought I’d Bought a Home, Then the Coronavirus Hit’ appeared first on Real Estate News & Insights |®.

What We Learned From Losing Our Home in the California Fires

December 13, 2018

In October 2017, I was one of many who lost a home in the Northern California fires. Little did I know the financial and emotional toll this event would take on me and my family.  It has taken me over a year to have the strength to write about this and relive the obstacles we had to overcome to come out on the other side.

I want to share what I have learned from this painful process with the hope that it will spur others to begin to better prepare themselves before a catastrophic event occurs.  Or, if you have family or friends who are disaster victims, you can provide the needed support and better understand the emotional distress it may cause.

1. Understand your homeowner’s insurance policies inside and out.  After a disaster is not the time to dig into your insurance policy’s “declaration page” to understand your coverage in plain noninsurance language. If you are like many Americans, your home is your largest asset. According to Nationwide, about two out of every three homes in America are underinsured.

As a result, it’s crucial that people meet with their insurance agent pre-disaster to fully understand their coverage. I recommend exploring different scenarios with your agent and asking detailed questions. Among them:

  • If my house burned down partially or fully, what would I receive?
  • Does coverage include replacement value or some other measure of loss?
  • What are the exclusions to the policy?
  • What information, including documents, photos, etc., would I need to provide the insurance company to receive my full payout?
  • What are my deductibles?
  • Who would be my point person during the claims process?
  • Are there additional steps I should take now to protect myself?

After our disaster, I called my insurance agent immediately to get our claim started.  Our homeowners policy was quite extensive with coverage including: dwelling/dwelling extensions/other structures, personal property, loss of use/additional living expenses, and other coverage. Obviously, insurance companies don’t issue 100% payouts the day after a tragedy. In fact, what you ultimately receive may never be the maximum benefit, so plan to work for every penny and be your own advocate. We had a claims adjuster bring us a check that was an advance against our claim and then we sat down with him to review what coverage we had under the policy.

2. Document your home. Documenting our loss was by far the most laborious process I have ever undertaken, not to mention emotionally draining. While we had numerous photos of the inside and outside of our home uploaded to the cloud, they were not nearly sufficient to the task.  For months, my husband and I devoted our evenings to sitting in front of excel spreadsheets rebuilding our home on paper.

First, we were required to list the interior finishes of our home such as crown molding, baseboards, countertops, cabinets, flooring, etc.  This step was hindered by the fact that we weren’t the original owners of the property and didn’t have architectural drawings or specifications. Second, we had to list outdoor items, including every plant and tree on our property.  Third, we had to document the loss of all of our personal-property content down to the number of forks and socks.

The personal-property spreadsheet required the following information: item number, quantity, detailed description of item, brand name/model number, age of item, condition, today’s repair cost/replacement cost/amount of loss and documentation attached.

Logging and documenting thousands of items was a time-consuming and daunting task. It would have been easier if our photos and videos had included literally everything inside our home, as well as everything on the outside. And in a perfect world, receipts and appraisals would have been uploaded to the cloud.

One thing we learned while I was already well along in the process of documenting the content loss was that my insurance company was willing to pay 75% of the personal-property content loss without any documentation. Being so far along in the process ourselves we did not use this option, but it may be worth considering in your particular situation.

In addition, we found out that the insurance company had its own software program to record and document the loss. Using the insurance company’s software could have saved us the time we spent in creating our own Excel spreadsheets. Evaluate both options before starting the process.

Another option if you want help with the claims process is to hire a public adjuster to negotiate with the insurance company on your behalf.  Some people go this route in hopes of receiving more money than if they had done everything themselves. However, public adjusters will charge for their services.

3. Know your game plan during and after the disaster. None of us want to confront the possibility of catastrophe or imagine what we should do during and after such an event. However, preparation in advance is essential. There are a number of questions we all need to think about and answer:

  • What items will I absolutely need to take with me in the event of an evacuation order?
  • If I lost my home, where would I go?
  • Who would I need to call?
  • Do I have money that I can access until I get an advance from the insurance company?
  • How will I ensure my pets are taken care of if I don’t have a home?
  • If the family is separated during the disaster, do we have a rally point or some other means of finding each other?

When it is safe to return to your home site, take photos and videos of whatever is left. If you are living in temporary housing, you will need to review with your adjuster what is and is not covered under “loss of use” coverage. And make sure to keep all receipts for expenses covered under that provision.

It may seem counterintuitive, but continue to pay insurance premiums and make your mortgage payments even if your home is completely destroyed–at least until you have determined what your legal rights are and how nonpayment will affect you. You also should apply for FEMA assistance.

Be careful. After the loss of your home you will be vulnerable and there are people who are willing to take full advantage of your vulnerability.

A vital lesson we learned is that the cost of rebuilding a home in an area where much of the housing has been destroyed is significantly higher than building costs before the disaster. Construction prices will go up significantly simply due to the forces of supply and demand. This issue, and ways to mitigate its effect such as replacement cost coverage, should be a focus of any discussion with your insurance agent about your current policy. I highly recommend you have that discussion now.

I’m so thankful to be past this chapter in our lives.  It was a difficult experience but I am grateful for the many people who helped us along the way–and to the firefighters, police officers and neighbors who tried to save our home and the homes of so many others.

If this piece motivates readers to begin the process of preparing now for disasters–whether they be fires, earthquakes or hurricanes–it will have well served its purpose.

The post What We Learned From Losing Our Home in the California Fires appeared first on Real Estate News & Insights |®.