How To Effectively Purchase A Property Without Seeing It In Person – James Newhouse III
On this episode of The Closing Table, we sat down with James Newhouse III!
To watch the full episode, check it out on YouTube below. In the meantime, here’s a summary of the conversation…
Here’s what you missed from James Newhouse III…
The conversation began with a this or that icebreaker on appraised value, closing costs, and more. James then reveals glimpses of his life beyond the real estate realm. When asked to introduce himself, he proudly identifies as a loving husband and a dedicated father. He expresses his fondness for boating and the thrill of exploring different lakes. He also talked about his burgeoning interest in golf and his active involvement in community initiatives.
James primarily operates in Newaygo County, but his reach extends to other areas as well. With his family hailing from Grand Rapids, he also caters to the larger Grand Rapids region. Furthermore, he covers the expansive Higgins Lake area up north and even serves clients in Battle Creek. He also shared how Newaygo County boasts a ton of recreational activities. Boating, fishing, and snowboarding are popular pastimes in the area, providing ample opportunities for outdoor enthusiasts to indulge in their hobbies. Meanwhile, Grand Rapids showcases impressive growth and urban revitalization. The city has undergone significant rehabilitation efforts, including the renovation of buildings and the construction of new condominiums. This revitalization has contributed to the overall appeal of the region, making it an attractive destination for prospective homeowners and investors.
The two then talked about the increased reliance on technology and virtual tours has significantly impacted the home-buying process, particularly in light of the limited housing inventory and the fast-paced nature of the market. In fact, a remarkable 8% of buyers have made purchases based solely on virtual tours, showings, or open houses, without physically visiting the properties. This shift towards virtual home buying experiences has been further accelerated by the COVID-19 pandemic. James acknowledges the transformative role of technology during this time. He even mentions a personal experience where he listed a property and sold it within 24 hours, all without ever leaving his house. Similarly, there have been instances where buyers and sellers have completed transactions without the need for physical visits.
Despite the convenience and accessibility offered by virtual tours, James emphasizes the importance of conducting inspections when purchasing a home. This step ensures that the property is thoroughly examined and any potential issues are identified. He also advises buyers, especially those who are out of state, to consider having a trusted relative or representative close to the property attend the inspection on their behalf. While virtual home buying has gained popularity, James stresses the significance of asking numerous questions to gather as much information as possible about the property. This proactive approach enables buyers to make informed decisions and gain a comprehensive understanding of the home they are considering.
Kevin then asked about the subject of how 1% of sellers have opted to sell their properties to iBuyers, prompting a discussion on the impact of iBuyers on the real estate market and the implications for sellers considering this option. James shares that he has not personally observed any significant impact from the presence of iBuyers in the market. He holds the belief that, ultimately, personal relationships and connections with people will continue to surpass the influence of technology and automated transactions.
Next, the conversation shifts to a proposed bill that aims to expand Michigan’s land bank law. Under this bill, cities with a population of at least 50,000 would be allowed to establish their own land bank authority, provided that no land bank already exists in the county. Considering the pros and cons of a city operating and managing its own land bank, James expresses his support for such initiatives. He highlights the potential benefits of land banks in rebuilding communities affected by poverty, addressing areas with numerous abandoned homes, and tackling neighborhoods experiencing higher crime rates. James believes that by repurposing old factories into condos or other useful spaces, communities can be revitalized, reducing crime and improving the quality of life.
Additionally, James notes that grant funding and private investments could facilitate the transformation of neglected properties, potentially providing housing options for low-income households in high-rent areas. While acknowledging the presence of potential drawbacks, he contends that the overall advantages of establishing a land bank would likely outweigh any negatives. When asked about the potential benefits of a land bank in his own market, James believes it would be particularly advantageous for areas in West Michigan and parts of Grand Rapids, given the opportunities for community regeneration and the repurposing of existing properties.
In the past three months, various issues have affected real estate contracts, including contract terminations, delayed settlements, and delays specifically caused by appraisal issues. James explains that in recent years, there has been a trend of buyers making offers significantly higher than the asking price and waiving inspections. This approach has led to potential issues with undisclosed property faults, particularly with roofs, which were not identified due to the absence of inspections. Consequently, when inspections are eventually conducted, buyers are often surprised by the defects they encounter. However, these buyers may lack the necessary funds to address these issues as they had already spent their money paying over the appraised value to secure the home.
Regarding the topic of predatory lending practices, a case in Pennsylvania involved a lending company disguising one-year rent-to-own agreements as “100-Day Cash Payoffs” and targeting low-income individuals who relied on financing to make significant purchases. To prevent clients from falling victim to predatory lending practices, James emphasizes the importance of realtors partnering with reputable lenders whom they know and have established relationships with. While clients have the freedom to choose any lender they prefer, he strongly recommends working with lenders he trusts. If clients opt to work with other lenders, he advises them to ask numerous questions, be vigilant for red flags, and hope for the transparency they deserve.
The conversation wraps up with James discussing where he draws inspiration from. He shares that one of them is observing his local community’s growth and transformation through hard work and dedication. He also mentions following Dave Ramsey’s principles of becoming debt-free and working hard to build a secure future for oneself and one’s family. James firmly believes that doing what is right should be the primary focus, with financial success following as a natural consequence. And when you take care of your people, they take care of you.
Check out James Newhouse III:
https://www.facebook.com/james.newhouse2
https://www.facebook.com/JamesNewhouseRealtorEnselyRealEstate
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