October Lake of the Ozarks Real Estate Update

Home Warranty Plans

Frequently in the home buying or selling process, buyers encounter homes whose sellers are offering home warranties.  Both buyers and seller (and some agents) are frequently under the impression that these warranties cover most, if not all, costs to repair or replace things that fail in the home.

A home warranty is a contractual agreement provided to an owner of a house by any of a number of different types of entities. In the case of this article, I am referring to “home warranty” companies.   The home warranty industry was founded in 1971 by American Home Shield.  In the strictest legal sense a warranty of any kind must adhere to guidelines set at the states' and federal government's levels. But the word “warranty” is not always used explicitly to mean a legal warranty is being conveyed. Usually, a home warranty is not a warranty at all but rather a home service contract that covers the repair and/or replacement costs of home appliances, plumbing, heating and cooling and electrical systems, and possibly other components. Coverage and costs vary significantly across home warranty companies and home warranty contracts do not cover all home repairs.

Some home plans are more expensive and cover more items while others are more limited.  Most require that you pay a service fee, around $50 to $100 per incident and also have a maximum amount that they will pay per covered item and a limit on what they will pay in total.  Be sure that you are aware of what the coverage exclusions are and if the company pays the full cost of replacing an item or its depreciated value. 

Some common complaints that home warranty clients have about warranty companies are:            1. Deny the claim citing homeowner's maintenance negligence or “pre-existing problem”

2.  Repair the equipment even when it is in such bad shape as to be replaced (which may keep it running until your warranty ends)

3.  Utilize sub-standard service providers (the warranty company chooses the provider), this issue is often attributed to the fact that they have negotiated lower rates from these providers

Most warranty companies have a “Sample” Coverage Terms document that outlines what is included and excluded as well as some other terms.  These generally look pretty good.  Many have fine (miniscule) print that references a cover/front page that details specific coverage on the particular home.  Make sure you have all information before making a decision.

One of the best preventive measures you can take to reduce the risk of nasty equipment failure surprise after closing is to schedule a thorough home inspection (by a reputable, knowledgeable company).  Your purchase contract should allow for an inspection and have a date by which you must complete and report any issues to the seller.  If their response is that the home warranty will cover it, look over the coverage terms AND make a call to the warranty company to verify this.

A great resource for home warranty information and reviews of existing companies as well as a list of ones no longer in business (some reportedly still selling warranties).  www.HomeWarrantyReviews.com Reports I have read state that around 20 companies went out of business between 2013 and 2014.    

A home warranty can be a great asset, you just need to do a little homework to make sure you know as a seller what you are offering and as a buyer what you are receiving.  

Michael has been selling real estate at Lake of the Ozarks since 1981.  He is one of the most respected brokers in the area.  If you would like a detailed sales report and value for your specific property type or neighborhood, or would like information on the best buys at the lake, contact C. Michael Elliott & Associates at 573.365.SOLD.  You can also view each month’s article, ask questions and offer your opinion on his blog at www.AsTheLakeChurns.com

September Lake of the Ozarks Real Estate Update

Lakefront Home and Condo Sales

During the first 8 months of this year, the number of lakefront home sales increased by by15.7% compared to 2014 and 2013.  The average sales price increased 3.6% this year over 2014 however 2013’s average sales price was 2.1% higher than 2015.  The median sales prices remained about the same in homes priced under $500,000 with the $500,000 and up market showing increases however the higher price range showed a decrease of about 50% in the number of sales.  I have been seeing a great deal of activity in the upper end market homes under contract and I think we will see some “catching up” in the upper price range over the next 30-60 days.

Condo Sales increased by 27.4% in 2015 with a total of 446 sales.  The average sales price was down 3% over last year but showed a 1.4% increase in price over 2013 as well as an 18.9% increase in the number of units sold in 2013.

The overall market is seeing a nice, steady increase.  The Fall market indicators look good.  I am also seeing an increase in lot sales and interest in building.  There are a large number of buyers who are already second homeowners looking to either build a new home or purchase a larger home as well as buyers making the switch from a condo to a home.

Sales data represents January 1 through August 20 of each year reported and was obtained from the Lake of the Ozarks/Bagnell Dam AOR MLS.

I realize that this data combines all property types and locations of lakefront homes and condos.  There are many areas and price points that I see decent value increases while other still continue to remain steady; I am seeing very little decrease in values compared to the last two years.  If you would like a detailed sales report and value for your specific property type or neighborhood, please contact me.

Michael has been selling real estate at Lake of the Ozarks since 1981.  He is one of the most respected brokers in the area.  If you would like to work with Michael in the sale or purchase of property, contact him at C. Michael Elliott & Associates at 573.365.SOLD.  You can also view each month’s article, ask questions and offer your opinion on his blog at www.AsTheLakeChurns.com  and Search and view thousands of lake area listings at www.YourLake.com

August Lake of the Ozarks Real Estate Update

About half of all sales at the lake are lakefront or lake access homes.  Many of these sales include a private boat dock.  When purchasing or selling a home, you need to be aware of the requirements by both Ameren Missouri and the appropriate fire protection district in order to transfer the dock permit to the buyer. 

     When a property located in the Osage Beach or Lake Ozark Fire Protection District or Village of Four Seasons transfers ownership, an inspection of the electrical system on the dock must be made by the Fire District or the Village before transferring the dock permit to the new owners. A copy of this inspection approval must be submitted with the permit transfer application to Ameren Missouri.

     All Lake Area Fire Districts and the Village of Four Seasons require a permit and inspection when installing or modifying a dock as well as any time work is being performed on the electrical system of a dock.  In order to complete the initial or modification dock permitting process, Ameren Missouri requires a copy of the Inspection Approval. 

     If you are selling your property with a dock, I recommend that you complete the electrical inspection approval as soon as possible.  Due to an onslaught of inspection requests, some of the districts have up to a 6 week backlog.  This could possible cause a delay in the closing of your home if you wait until you have a contract in place to start the inspection process.  Also, if there are any items that need attention, you will be able to address these and present this information to potential buyers.  The added benefit to you is knowing that your dock is safe while you and your family continue to use it.

     When you are purchasing a property with a dock you should make sure that the dock is properly permitted with Ameren Missouri and that there have not been any changes since the permit was issued.  If required, you will also need to request an electrical inspection from the proper entity in order to have the dock permit transferred into your name.  This will allow you to discover any potential issues prior to closing in the event that there are compliance problems that need to be addressed.

     If your property is not for sale or is not located in an area that requires an electrical inspection for the transfer of the permit, I highly recommend that you still contact the appropriate agency for an inspection.  Most of the districts charge a $50 to $75 fee for the inspection.  In my opinion this is a bargain, especially if you consider the potential cost of having an electrical issue on or around your dock.

     AmerenMissouri.com/Lake has a wealth of information on their website about permit requirements including contact information for fire districts and other inspection agencies.

     Michael has been selling real estate at the Lake of the Ozarks since 1981.  He is one of the most respected brokers in the area.  If you would like to work with Michael in the sale or purchase of property, contact him at 573.365.SOLD or cme@yourlake.com  View thousands of lake area listings at www.YourLake.com.  You can also view each months’ article, ask questions and offer your opinion on Michael’s real estate blog, www.AsTheLakeChurns.com