FAQs for First Time Buyers


If I am thinking about buying, when should I start looking?
I generally recommend that buyers start looking approximately 4-6 months before your ideal purchase date. Looking early can give you an opportunity to ease into the home-viewing process and also will allow you to get a sense of the market (what’s available, prices) before you are in it “for real.”
 
 
Once I find a home and make an offer, how long does it take to close?
On average, the time from contract to close for homes in the Charleston market is about 6-8 weeks. This timeline can be shorter, but if you are getting mortgage, most banks ask for at least 4-5 weeks to process a loan. The timeline can also be longer, but sellers typically like to keep the timeline as short as possible.


Once I close, when I do get to move in?
Usually, a buyer takes possession at closing which means that, as of closing, the house is yours! Occasionally, buyer and seller may agree to allow the seller to stay in the house past closing or for the buyer to have access before closing, but these types of arrangements are less common. 
 

When in the process should I talk to a mortgage lender?
As soon as possible! Or, at least before you go out seriously looking at homes. A mortgage lender can “pre-qualify” you; this is helpful for a few reasons:

• It helps you know, realistically, how much the bank is willing to lend to you and how much you may want to spend
• Many sellers will require proof of pre-qualification to accompany any offers on the home—getting prequalified means you are ready to make an offer if the right home comes along

How do I find a mortgage lender? 
Your real estate agent is a great source for recommendations, and friends and family can also be a great resource. 

 
Other than a down payment, how much cash do I need to buy a home?
When it comes to buying a house, you will need some cash handy. These are to cover (1) Closing Costs, (2) Items paid outside of closing, and (3) Moving and other miscellaneous costs.

1. Earnest Money - Right after you go under contract, you will deposit some "earnest money." The amount varies, but it can be anywhere from 1-3% of the price of the home. This money sits in an escrow account until closing, at which time is is applied towards your sale. 
2. Closing Costs – These are costs paid at Closing. The bulk of these are typically bank fees, and the amount will vary from loan product to loan product (anywhere from 1-5% of the cost of the home). This is another great reason to talk to a mortgage lender early--they can give you an idea of what to expect for closing costs. In some cases, it may be possible to get the seller to pay for some closing costs, but in a hot market, this may be less likely. Also included in closing costs are:
   1. Fee to your closing attorney
   2. Insurance premium (may or may not be required upfront, depending on your loan)
   3. HOA fees or property transfer fee if applicable for the neighborhood
3. Items Paid outside of Closing – I usually suggest that buyers have $1000-1500 on hand to cover:
   1. Home Inspection ($400-750, deepening on the size and age of the house)
   2. Termite Inspection ($100-250) – note, this is sometimes paid for by seller, depending on the contract terms
   3. Other specialty inspections – These typically only occur if there is a specific concern that would not be addressed by a standard home inspection. Examples may include a roof inspection, HVAC inspection, plumbing inspection, etc.
   4. Appraisal – generally required by the bank and paid before closing ($400-750). 
4. Moving and Other misc. costs:
   1. Repairs or aesthetic updates, painting, etc.
   2. Changing locks - strongly recommended 
   3. Buying Washer/Dryer or other appliances (if they do not convey)

 
 
How does my Buyers’ Agent get paid?
In the Charleston market, 99.99% of the time, the buyer’s agent is paid by the seller at closing. To be more specific, with the proceeds of the sale, the seller pays the listing agent's company, then the listing agents's company pays the buyer agent's company. The individual agents get paid a portion of this by their respective companies.

So, as a buyer, you do not need to worry about paying the agent directly—this is covered by the transaction and is already factored in to the final sale price of the home.  In extremely rare cases—typically in an off-market, for-sale-by-owner situation, the seller may refuse to pay a buyer’s agent. If this unlikely scenario were to happen, the buyer and the buyer agent would discuss the buyer agent’s compensation before engaging in the transaction so everyone feels comfortable with moving forward.


Why should I use a Buyer’s Agent? Why not just call the name of the agent that’s on the sign of a house I’m interested in?
The agent whose name is on a sign outside of the home is the exclusively representing the seller of that home—while they are required to treat you, a prospective buyer, with honesty and fairness, their job is to represent the best interests of the seller.
 
On the other hand, when you work with a Buyers’ Agent, your agent’s duty is to YOU and your interests. In addition to the logistics of setting up showings and gathering market information, your buyers’ agent will go to bat for you when it’s time to negotiate a contract, and they will manage the transaction from contract-to-close on your behalf. And, since the sellers have already agreed to pay a buyers’ agent when they put the home in the MLS, using a buyer’s agent does not cost the buyer anything on top of the price of the home (see “How does my Buyers’ Agent get paid?” above), so it’s a win-win for the buyer.
 
 
 
Have additional questions? Email Leize at leize@williammeans.com

Impact on Prices... Or not? 

Anyone who has been watching the Charleston market for any length of time knows that historic downtown prices have been steadily on the rise for the last few years, in spite of a few major flooding events. Except in some rare incidences, I have not seen dropping in prices directly related to flooding; however, we have most certainly seen a slow down in the rate of increasing prices, though whether this is a result of weather risks or other market factors, it is not clear. Make no mistake, though: As of now, prices in historic Charleston continue to rise regardless of flood risks, as homes on the peninsula are a scarce resource.

Deterred buyers... Or not? 

Last year after Hurricane Irma, I was out showing property (on a street that had flooded!) one week after the storm. The fact that the street looked relatively normal just a few days after a major weather event showed that while flooding can be a nuisance, things can often get back to normal fairly quickly if you have the resources to expedite a clean up. That said, while some buyers seem undeterred, I have definitely seen an up-tick in buyers looking to avoid flood-prone area in the last couple of years.

More educated buyers (and agents)

Prior to October 2015, Charleston hadn't had a major, wholesale flooding event since Hurricane Hugo in 1989, leading many buyers to underestimate the risk of flooding and many agents to be unaware (or unable to remember) of the history of certain parts of town. Recent flooding events have resulted in a much savvier buyer when it comes to location and home updates to mitigate flood-damage, and agents are, in my experience, more knowledgeable about these issues.

Strengthening the sales pitch for certain homes, and weakening the case for others

Prior to October 2015, it was rare to see any mention of flooding (or lack of flooding) in a property listing description. These days, it's not uncommon to see mention of "high ground" or "no recent flooding" in the description for homes that meet this criterion. Sellers and sellers' agents know that this question is top of mind for buyers and buyers' agents, so they are putting it out there, front and center. By contrast, homes with known flood history (particularly those with first floor flooding, rather than just crawl space inundation), are struggling to sell unless sellers have taken special steps to curb future flood related hassles. 

Homeowner fixes to mitigate future flood-hassles

Sellers with homes in flood-prone areas are increasingly taking steps to mitigate future hassles. One of the most common steps is the removal of under-house duct work in favor of mini-split air conditioning units. This is a controversial topic: Some swear by their efficiency and breathe easy (no pun intended) knowing they aren't going to have to deal with flooded ductwork the next time a hurricane blows through. Others find them visually obtrusive and would rather take the risk. Some homeowners have reached a happy medium--keeping traditional HVAC systems but replacing the duct work with waterproof PVC. While forward thinking home updates will not guarantee a home sale, they certainly don't hurt. 

Confusion about Flood Zones

I see a lot of confusion about flood zones, and why wouldn't there be confusion? FEMA's flood maps is notoriously difficult to navigate, and there's been talk of new flood maps for Charleston for going on 2+ years (the new maps are still not in effect, BTW). I frequently have buyers tell me that they "don't want to look any any homes in a flood zone." Since technically all homes are "in a flood zone" (some low-moderate, others higher risk), I have to figure out whether someone making this statement actually means (a) they want to avoid areas known to be flood-prone or (b) they want to avoid all high-risk areas as defined by FEMA, regardless of whether or not the area has any known flood history. 

Impact to active transactions 

​In the event that a hurricane hits in the days or weeks prior to a Closing, things can get complicated--A storm could cause damage to a home resulting in extra needed repairs, it could temporarily halt a buyers' ability to get insurance, or it could delay a closing because a law office is closed. Rather than sort through endless "what if" scenarios ahead of time, I've learned that it is best to assess a situation as it unfolds and navigate the transaction accordingly, for my clients' best interest. 

With the storm watch going on day 3 (or is it 4? I lost count), those of us who remain in Charleston are feeling a mixture of optimism that we won't get the worst of it and empathy for our neighbors to the north who are currently facing Hurricane Florence head on. All those impacted by the storm in Eastern NC and the Outer Banks are in my thoughts this morning. Meanwhile, impact to Charleston remains yet to be seen. We are expecting rain and wind starting this evening, as well as possible storm surges--particularly around high tides (roughly 1 AM tonight and 1:40 PM tomorrow afternoon). Everyone stay safe and dry. 

Last month marked one year since Ben and I closed on our new home in Wagener Terrace. We have enjoyed our new neighborhood even more than we expected. Learn more about our stomping grounds below!

Location and Boundaries
Wagener Terrace is located in downtown Charleston, above the crosstown. The neighborhood is located north of Hampton Park, west of Rutledge Avenue, and south of Sunnyside Avenue. While the neighborhood mostly consists of 1940s/50s homes, two newer planned developments are located within the boundaries of Wagener Terrace: Longborough (Mary Ellen Drive/Alberta Street) and Lowndes Pointe (Lowndes Pointe Drive) and feature homes built in the 2000s. Wagener Terrace is often confused with nearby neighborhoods, Hampton Park Terrace (below Hampton Park) and North Central (East of Rutledge Avenue).

Some Brief History
Prior to the 20th century, the are that is now Wagener Terrace was primarily farm and wet lands. After the South Carolina Inter-State and West Indian Exposition (1901-1902) in what is now Hampton Park, the areas directly surrounding the park became targeted areas for residential development. Wagner Terrace lagged behind the development Hampton Park Terrace to the south of the park, the first streets and lots where platted under the name "Wagener Terrace" in 1918. The first homes were built in the 1920s and 30s with the bulk of building occurring over the next three decades, particularly after WWII. Families who bought homes in Wagener Terrace were largely middle-class Protestant families who worked on peninsula, though the neighborhood was also home to middle-class Greek and Jewish families.

Architectural Styles
Wagener Terrace has an abundance of "Minimal Traditional" homes, a style of suburban home typical of the 1930s-late 1940s. Typically one story and sided in brick or cement shingle, these homes are often colloquially referred to as "bungalows" but they actually post-date the Arts and Crafts movement. Other Charleston neighborhoods where Minimal Traditional homes are common include Byrnes Downs, Avondale, and Ashley Forest in West Ashley. Throughout Wagener Terrace, you will also find a scattering of mid-century ranch style homes, a few colonial revival homes, and some newer construction (1990's-2000's) in Lowcounty vernacular styles.  

On the Market Now
Here's a look at what's on the market now in Wagener Terrace. 

I've been working with several buyers who have recently asked: Should we make a move on something now OR should we wait and see what hits the market later in the fall? Like most things, the answer is, "it depends."

But... I do have some thoughts on this question that may help buyers reach their own conclusion. Read on...

You may opt to wait if:

• You are looking for some fresh options: The fall is typically a time when we see more listings hit the market. If you feel like you have seen all there is to see for the last few months and you have not been moved to make an offer on something, waiting for some new listings to crop up may be the way to go. 
• You aren't turned off by bidding wars, multiple offer situations, and less flexible sellers: If you have the freedom (financially or logistically) to make a swift and aggressive offer on a new property, you will be at an advantage during a busier buying season when multiple offer situations and less flexible sellers are more common. 
• You are flexible on your move date. A fall search can easily can carry over into the next year. In my experience, buyers who decide to wait until fall to buy frequently don't end up closing on a new home until January, February, or March of the following year. If you are flexible on your move date, you will be able to be patient, even if that means carrying your search over until next year. ​
  

I've had a few prospective buyers and Charleston newcomers ask me about Charleston real estate terms, geographic locations, and other lingo that I often take for granted as being widely known and understood. To help those of you who may be curious, here are some terms to help you navigate Charleston real estate conversations.

This time, I'm focusing on Downtown terms--in future newsletter, I'll tackle other parts of town! And, feel free to email me with your questions if there's another term you have heard and are wondering about.

• "Downtown" = This term is used interchangeably to refer to (A) Anything on the Peninsula (above or below the Crosstown), (B) Anything below the Crosstown (aka the "Lower Peninsula"), or (C) Anything below Calhoun Street (aka "Historic Downtown Charleston"). All uses are correct, depending on the context.
• "Historic Downtown Charleston" = Anything below Calhoun Street. Zip code is 29401. Made up by four neighborhoods-South of Broad, French Quarter, Harleston Village, and Ansonbourough.
• "Lower Peninsula" = In real estate/MLS, this is referred to as "Charleston Below the Crosstown." Anything below the Crosstown. Made up of the four Historic Downtown Charleston neighborhoods (zip code 29401) plus other neighborhoods (all zip code 29403): Elliottborough, Cannonborough, Mazyck-Wraggsborough, Eastside, and Radcliffeborough.
• "Upper Peninsula" = In real estate/MLS, this is referred to as "Charleston Above the Crosstown." Anything above the Crosstown until you get to the border of the City of North Charleston. Contains several residential neighborhoods and some growing commercial areas (restaurants, boutiques) with Hampton Park as a major landmark. Zip code is 29403. Neighborhoods include Hampton Park Terrace, Wagener Terrace, West Side, and North Central. The "Upper Peninsula" may also refer specifically to the primarily non-residential section of town above Mount Pleasant Street that parallels I-26. 
• "King Street" = Usually refers specifically to King Street below Calhoun.
• "Upper King" = King Street above Calhoun.
• "Lower King" = Usually refers to the residential section of King Street below Broad (from Broad Street to the Battery).
• "Lower Tradd" = Typically refers to Tradd east of Meeting Street.
• "Lower Queen" = Typically refers to Queen east of Meeting Street.
• "Lower Church" = Typically refers to the section of Church Street that is brick (from Water Street to South Battery).
• "The Battery" = The elevated battery on East Bay Street. May also be referred to as the "high Battery."
• "The low Battery" = The street level battery along Murray Boulevard. Extends from East Bay down to the Coast Guard station at Murray and Tradd. 
• "Charleston Single" = One of Charleston's traditional and most iconic architectural styles, characterized by a narrow side (a "single" room wide) facing the street and a side entrance. If there is a piazza (side porch, usually accessible to the street), there may also be a street front door to the porch, and the main entrance will be accessible via the the porch. On the interior, the stairway will be found up the center of the home. 
• "BAR" = The City of Charleston's Board of Architectural Review. Generally speaking, BAR approval is needed to make any changes to the exterior of a home that is visible from the public right-of-way. More info here.
• "BZA-Z" = The City of Charleston's Board of Zoning Appeals. This Board makes decisions regarding lot usage, lot coverage, building set backs, height restrictions, and parking requirements. More info here.
• "In a flood zone" = Could mean one (or both) of two things: (1) The home is in a FEMA defined higher risk flood zone (AE or VE) where flood insurance is recommended and would be required if you have a mortgage on a home, and/or (2) The home is in an area prone to flooding. Note, not all homes "in a flood zone" are on streets or in areas where flooding is a noted issue. Most of the Charleston peninsula is in flood zone AE, though there are some very rare pockets of downtown where you can find flood zone X.
• "Not in a flood zone" = This phrase is thrown around, but it's a bit of a misnomer since technically everything is in a FEMA flood zone of some kind--low/moderate (X zone) or higher risk (AE or VE). That said, when people say a home is "not in a flood zone," they usually mean that it is in flood zone X. While no one can guarantee that flooding will never be an issue, homes in flood zone X have the lowest risk of flooding. 
• "Easement" = In downtown Charleston, there are generally three types of easements you are likely to run across: (1) Exterior easements, (2) Interior easements, and (3) Access easements. While they do not exist on every historic home, exterior and interior easements are a useful historic preservation tool and, when in place on a particular home, are typically managed by Historic Charleston Foundation, The Preservation Society of Charleston, or similar preservation not-for-profit organizations. Exterior easements protect specific exterior features of a home (depending on the home and the details of the easement, it could apply to home color, architectural details, materials, landscaping, or other exterior features that may exceed BAR requirements). Interior easements are less common; when in place, these protect exceptional interior features of a home--most commonly trim, paneling, plaster, and other rare or significant historic details. Access easements are to allow home owners who share driveways or walkways to maintain rights for usage. The need for an access easement is rare; however, there are homes, particularly in the oldest parts of the city where one home is situated behind or extremely close to another, making an access easement the best way to minimize confusion or disputes regarding ingress/egress. 

That's all for now!
​What Charleston real estate terms have you stumped?