Why Does a Home That Costs $25,000 Less Cost 64% More per Month to Buy?

You really have to factor in interest rates when doing comparables now.

For example, I just ran comparables and one seller is asking $890,000, and another seller is in escrow asking $915,000.

So on the surface the $890,000 price looks cheaper. However, the one is escrow has a VA assumable loan at 2.25%.

When running the numbers I found a buyer would be paying 64% more per month for the $890,000 purchase vs. the $915,000 because of the rate difference.

So you have to consider what the rate was at the time that home went into escrow and if there was a VA or other type of assumable loan used in the purchase.

If you want to look up a mortgate rate for an earlier listing you can do so at https://www.oahure.com/MortgageRateTable.php.

Why a termite inspection is needed.

Getting a termite inspection is important for several reasons. Termites are wood-destroying insects that can cause significant damage to a property if left untreated. They can infest the wood in a home or building, causing structural damage that can compromise the integrity of the structure.

Here are a few reasons why you might want to consider getting a termite inspection:

Protect your investment: A termite inspection can help protect your property and prevent costly damage. If termites are detected early, treatment can be applied to eliminate the infestation and prevent further damage.

Meet lender requirements: Many lenders require a termite inspection before approving a mortgage loan. This is to ensure that the property is not at risk of termite damage, which can affect the value of the property.

Peace of mind: Even if you do not suspect a termite infestation, getting a termite inspection can provide peace of mind. A professional inspection can identify any potential issues and help you take action to prevent infestations in the future.

Overall, getting a termite inspection is an important step in protecting your property and ensuring that it remains structurally sound. It is recommended that you get a termite inspection at least once a year, or more frequently if you live in an area with a high risk of termite infestations.

Photo by Koa’link on Unsplash

Why would you want to live in Waikiki?

There are many reasons why someone might want to live in Waikiki, which is a neighborhood located in Honolulu, Hawaii.

Beaches: Waikiki is home to some of the most famous and beautiful beaches in the world, including Waikiki Beach, Kuhio Beach, and Queen’s Surf Beach. If you love spending time in the water, sunbathing, or just taking in the ocean views, Waikiki is an excellent place to live.

Culture and Entertainment: Waikiki is a hub of cultural and entertainment activities, with plenty of restaurants, bars, nightclubs, and theaters to explore. The neighborhood is known for its lively nightlife, hula shows, and other cultural events.

Outdoor Activities: In addition to the beaches, Waikiki is surrounded by opportunities for outdoor activities such as hiking, surfing, paddleboarding, and kayaking. There are also several parks and green spaces in the area where you can enjoy a picnic or a leisurely stroll.

Climate: Hawaii has a warm, tropical climate year-round, which means you can enjoy outdoor activities and comfortable weather no matter the season.

Diversity: Waikiki is a melting pot of cultures, with people from all over the world calling the neighborhood home. Living in Waikiki means you’ll be exposed to a diverse range of perspectives, customs, and traditions.

Of course, living in Waikiki also has its challenges, such as a high cost of living and a large tourist population. However, if you’re looking for a vibrant, culturally rich community with plenty of outdoor activities and gorgeous beaches, Waikiki could be a great place to call home.

Photo by AussieActive on Unsplash

Why would someone want to live in Kailua, Hawaii?

There are several reasons why someone might want to live in Kailua, HI:

1. Natural beauty: Kailua is located on the eastern coast of Oahu, and is known for its beautiful beaches, turquoise waters, and lush greenery. Residents can enjoy activities such as swimming, kayaking, hiking, and surfing.

2. Climate: Kailua has a tropical climate, which means warm temperatures year-round, with occasional rain showers. This makes it an ideal location for those who love spending time outdoors.

3. Community: Kailua is a tight-knit community, with a small-town feel. Residents often participate in community events, such as farmers markets and festivals, and there are plenty of local businesses to support.

4. Access to amenities: Despite its small size, Kailua has plenty of amenities, including grocery stores, restaurants, and shops. It is also only a short drive from the city of Honolulu, which has even more options.

5. Relaxed pace of life: Living in Kailua allows residents to escape the hustle and bustle of city life, and enjoy a more relaxed pace of life. With its natural beauty, community feel, and access to amenities, Kailua is a desirable location for many.

Are Home Inspectors Deal Makers or Deal Breakers?

The quality of the Home Inspection will influence the probability of a sale, so it is critical to select a Home Inspector that is neither a Deal Maker nor a Deal Breaker.


What is a Deal Maker?

The Deal Maker will minimize the defects of the property which will influence the Buyer to proceed with the purchase of the property.

Why would a Home Inspector play this role?

The Home Inspector relies on the Realtor for business referrals, so the incentive is to not displease the Realtor and jeopardize the sale for the Realtor. The Realtor is happy that this contingency for the sale will be removed so that the sales process can move forward toward a closing date. Unfortunately, the Buyer does not benefit from this scenario as defects that were described by the Home Inspector as “minor” may, in fact, be discovered later by the Buyer as very “major”, and the Buyer will be stuck with the high repair costs. Once escrow is closed, it is exceedingly difficult to seek a remedy.

This is a major compelling factor that led to the regulation of Home Inspectors in 36 States. Click on this link for my last article, “Are Home Inspectors Regulated (Licensed) in Hawaii”?

Here is a graph to help illustrate this scenario:

What is a Deal Breaker?

The Deal Breaker will exaggerate the defects of the property which will influence the Buyer to NOT proceed with the purchase of the property. It is the opposite extreme of the Deal Maker.

Why would a Home Inspector play this role?

The Home Inspector’s personality and demeanor are the reason for this scenario. The interpersonal communication of the defects of a house to a Buyer can be a distraction from the actual defect. The purchase of the house can be an emotional decision and the presentation of the defects can lead to an impression that “The sky is falling”. This can be very discouraging to a Buyer that has “fallen in love” with the perfect house. In short, the Home Inspector is “scaring the Buyer” from purchasing the property.

Here is a quote that summarizes this scenario:

What is a Good Home Inspector?

Avoid the Deal Maker. Avoid the Deal Breaker.

The Good Home Inspector provides an Impartial Opinion based on Industry Standards and communicated objectively.

Simply put, “Inspectors shall be objective in their reporting and not knowingly understate or overstate the significance of reported conditions (ASHI Code of Ethics).

For any questions on this topic, please call Oscar Libed of Inspect Hawaii at 808-728-5707 or send an email to oscar@inspecthawaii.com

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Are Home Inspectors Regulated (Licensed) in Hawaii?

For many people, buying a home arguably represents the single largest purchase they will make in their lives, and contracting the services of a qualified home inspector may be a first line of defense.


What is Certification vs. Licensing?

A Certification verifies that a professional has met a certain set of criteria for a skill or job as measured by a third-party assessment, usually a non-government body like a Trade Association. For Home Inspectors, there are 2 national trade associations offering Certifications:  ASHI (American Society of Home Inspectors) and NACHI (National Association of Certified Home Inspectors).  They provide Standards of Practice for conducting Home Inspections and a Code of Ethics.

A License is a verification by a government agency that a professional can perform a particular occupation in a particular location, such as a certain State.

Why worry?

Excerpts from the Hawaii State Auditor’s Report No. 19-09 dated March 2019:

“Although certification programs are offered to home inspectors in Hawai‘i through the three organizations, we found indications that there are an undetermined number of non-certified individuals who are conducting home inspections in the State.

Which states do not require a home inspection license to perform home inspections?

14 states do not require a license to perform home inspections.

They are California, Colorado, Georgia, Hawaii, Idaho, Iowa, Kansas, Maine, Michigan, Minnesota, Missouri, Nebraska, Utah, and Wyoming.

Conclusion of State Auditor on the Regulation of Home Inspectors:

For many people, buying a home arguably represents the single largest purchase they will make in their lives and contracting the services of a qualified home inspector may be a first line of defense. State law currently requires sellers to provide prospective buyers a disclosure statement of any defects about which the homeowner is aware that may affect the value of a residential property. A home inspection may supplement the seller’s disclosure statement by identifying other potential issues about which the homeowner is not aware.

Based on the limited scope of work that home inspectors perform, coupled with an absence of reported complaints against home inspectors or home inspection businesses that might indicate the profession presents a risk to home buyers’ health, safety, and welfare, we are unable to conclude that regulation of home inspectors is “reasonably necessary to protect the health, safety, or welfare of consumers,” nor can we conclude that the health, safety, or welfare of consumers may be “jeopardized” by the nature of home inspection services.

Based on our assessment, we find there is insufficient evidence to meet the criteria under Section 26H-2, HRS, to require the regulation of home inspectors to protect the health, safety, or welfare of consumers.

For any questions on this topic, please call Oscar Libed of Inspect Hawaii at 808-728-5707 or send an email to oscar@inspecthawaii.com

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