Monthly Archives: November 2013

The Truth About Earnest Money

How Much Earnest Money Is Enough?

How Much Earnest Money Is Enough?

 

The topic of earnest money comes up all the time with our buyer clients. So, we decided to write about it so that others can learn.

Please keep in mind that rules regarding earnest money vary by state and it’s best to thoroughly read the purchase agreement to fully understand the details of how earnest money will be handled.

THE BASICS

To begin, let’s start with the basics. Earnest money, also known as “good faith” money, is not actually required by law in the State Of Ohio. It is, however, common and expected by the seller.

It is an amount of money that a buyer offers to the seller up front and is refundable in most cases if the deal doesn’t go through.

The money doesn’t actually go directly to the seller. It goes to a title company or real estate agency that holds onto the money until closing. Then, it gets applied to the buyer’s costs.

It’s basically a way for a buyer to show a seller they are committed to moving forward with the transaction. If a buyer doesn’t offer any earnest money, then there would be nothing stopping them from pursuing another home with no recourse to the seller. A situation deemed unfair by a seller.

HOW MUCH IS ENOUGH?

The most common question we get involves how much money a buyer should offer.  Unfortunately, there is not one specific answer. The general rule of thumb is 1-2% of the purchase price but it all depends on the situation.

If a buyer is in a potentially competitive situation, greater earnest money may make their offer more attractive than another buyers’.

The other terms of the offer, including price, dates and other contingencies, will also come into play. The earnest money is just one component of the overall offer.

CAN I GET MY MONEY BACK?

For the most part, a buyer is entitled to their earnest money back if a transaction doesn’t go through. However, there are always exceptions. We have seen rare cases where a seller was allowed to keep all or part of the earnest money, but the circumstances here were unusual.   

As long as you follow the terms of the contract, you shouldn’t have any problems. Your agent and or their manager can also provide guidance should a unique circumstance present itself.

Although earnest money is only one small part of the transaction, it does play a big role during negotiations and should be taken seriously.

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ABOUT THE AUTHORS

The above information is compliments of The Schuman Team, Amy and Dan, of Howard Hanna Real Estate Services. They specialize in Solon luxury homes, relocation, and first-time buyers.

They can be reached at 216-346-3235 or 216-403-9189 or via email, danschuman@howardhanna.com or amyschuman@howardhanna.com.

The Schumans service the following Cleveland area suburbs: Aurora, Bainbridge, Bay Village, Beachwood, Bentleyville, Chagrin Falls, Cleveland Heights, Gates Mills, Highland Heights, Hunting Valley, Lakewood, Lyndhurst, Mayfield Heights, Mayfield Village, Moreland Hills, Oakwood Village, Orange, Pepper Pike, Shaker Heights, Solon, South Euclid, University Heights, Westlake, Woodmere.

The Truth About Earnest Money is the property of The Schuman Team and may not be duplicated or used without their written consent.©Noevember, 2013

Solon Homes Report – October 2013

 

 

 

Here is our official market report for  Solon OH  for the zip code 44139, excluding Glenwillow, for homes sold in October 2013.

We will provide a list of all sold homes, including the names of buyers and sellers if available,  give monthly statistics, and make a comparison to last year.

We will also include a breakdown for the Solon luxury home market ( those priced over $500,000 ).

HOMES SOLD IN SOLON –  OCTOBER 2013

ADDRESS              PRICE         BUYER             SELLER

38670 Aurora Rd   $109,900  Diblasi, Salvetta A  Poet Thomas E III

35550 Timberlane $125,500   Linebarger Trust    Lang Lynn

35280 Bainbridge  $153,500   Ballard,Kenneth     Gaither Harry G

33700 Arthur Rd   $157,500   not available         Levy Cheryl L

36965 Pettibone   $158,000   Ketchem,Thomas   Musarra Gary P & Cheryl L

36525 Timberlane $160,000   Markovich, Andrey Werner Stephani F A

7533 Som Center  $164,200  Hendryx Roger B     Doherty Robert J & Marion E

38215 Fox Run Dr $165,000   not available         Holpuch John James

6568 Copley Ave  $167,000   Zhou Guangjin       Cancelli-Bartz Mary Kay

6610 Brookland     $173,500  not available         Jellen Christopher H

32610 Arthur Rd   $177,000   Daniel Craig D       Wurts Charles J

38255 Bainbridge  $177,500   Smith Kenneth      Dranchak Dale T & Diane M

5905 Liberty Rd    $180,000   Diorio Thomas A   Burton G E Living Trust

6614 Duneden      $185,000  Ranallo Michael L   Epstein Robert M

33596 Lisa Ln      $248,000   Leimeister AlexanderZuckerman Neil

6977 Kingswood   $260,100  Liang Yun             Sexten Brian & Linda

33221 N Burr Oak $280,000  Becker Christopher Bomell Christa

32720 N Burr Oak $285,000  not available         Terry Dennis Dunbar (Te)

7615 Lindsay Ln   $295,000  Buckley Marshall    Clark T S Family Trust

37174 Wexford     $415,000  Smit Lauren C       Kingdom Development Corp

5474 Tayport Dr   $447,000  Katz Lisa F           Ramsey Gary L

37214 Tidewater   $540,000  Keuchel Kenneth  Moore Jerry A & Angela R

32670 Burlwood    $590,000  Heller Scott         Dobrowski Mary

5980 Glasgow      $596,000   Liu Gang             Belianski Victor

6960 Woodlands   $681,400   Brown Daniel       Paspulati Raj M

5475 N Woods     $875,000   not available        Hedrick Diane MTrust

37150 Broadstone $1,089,889 Monesmith Kim    Prestige & Premier Companies

SOLD HOME STATISTICS SOLON OHIO – OCTOBER 2013

Date                                         # of homes sold         Ave. Sales Price

October 2013                                  27                               $328,000

October 2012                                  23                               $286,022

YTD 2013                                      271                               $308,528

YTD 2012                                      224                              $304,509

 

SOLON LUXURY MARKET

October 2013                                 6                                $728,715

October 2012                                 3                                $607,667

YTD   2013                                    43                               $654,320

YTD   2012                                    34                               $636,624

*source NEOHREX ( Regional MLS )

 

COMMENTARY:

The real estate market continues to show improvement compared to last year. Both number of sales and average sales price are up in Solon this year, one of only a few suburbs in Northeast Ohio with that distinction.

We got off to a blistering start to the year which has certainly helped the overall numbers. As mentioned in previous posts, things have cooled down a little bit since school started. While fall isn’t prime season, it certainly can be a popular time to buy or sell, as evidenced by the 27 homes sold last month.

While there are numerous factors that have helped make this a great year for real estate in Solon, low inventories continue to be a major influence. Currently, there are only 88 active listings. In past years, we would see 150+ homes for sale at this time of the year.

What this means is that buyers are screaming for new inventory and many have become quite frustrated. The buyers that really need to buy will snatch up a nicely finished home within days, provided it is priced fairly. If a home is not selling, price and condition are likely major factors.

The increase in the sales of Solon luxury homes is also a good sign. Move-up buyers are having an easier time selling their existing homes so are able to buy bigger homes. Some move-up buyers are actually buying their larger home first, feeling extremely confident that their existing home will sell.

Moving forward, we anticipate a natural slowdown through the rest of the year. However, when all is said and done, 2013 will be a strong year for Solon real estate.

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ABOUT THE AUTHORS

The above information is compliments of The Schuman Team, Amy and Dan, of Howard Hanna Real Estate Services. They specialize is luxury homes, relocation, and first-time buyers.

They can be reached at 216-346-3235 or 216-403-9189 or via email, danschuman@howardhanna.com or amyschuman@howardhanna.com.

The Schumans service the following Cleveland area suburbs: Aurora, Bainbridge, Bay Village, Beachwood, Bentleyville, Chagrin Falls, Cleveland Heights, Gates Mills, Highland Heights, Hunting Valley, Lakewood, Lyndhurst, Mayfield Heights, Mayfield Village, Moreland Hills, Oakwood Village, Orange, Pepper Pike, Shaker Heights, Solon, South Euclid, University Heights, Westlake, Woodmere.

Solon Homes Report October 2013 is the property of The Schuman Team and may not be duplicated or used without their written consent.©Novemeber, 2013