Buying Tips for Breckenridge & Summit County
Thinking about a property in Breckenridge or Summit County? Congratulations - this is a gratifying community to call home, for both year-round outdoor enjoyment and the community opportunities that bring families and friends together.
If this will be your first purchase in the area, there’s much to think about. The education a buyer should go through varies, depending on the type of desired property and the experience of the buyer. Here’s a sampling of matters to discuss with the Realtor that assists you in this important decision making process:1. Rentals. Will you place your property on the
short-term rental market? If yes, and if the income potential
will be weighted in your property selection, then you should
become familiar with cash flows for your candidate properties.
2. Inspections. Home inspections are typically
done after a buyer and seller sign a contract, but in some
instances, a buyer will arrange for an inspection prior to
signing a contract. The buyer selects the inspector, and the
inspector will review most or all aspects of the
home/condo/townhome: structure, utilities, general building
quality, unusual signs of wear or damage, etc. The home
inspection is an important part of the buying process, and
should not be skipped to save a few dollars. If objectionable
conditions are found, the buyer has the right to request that
the seller address those conditions; the buyer also has the
option to terminate the contract due to conditions brought up in
the inspection.
3. Lenders. If a new loan will be secured for
the purchase of the property, it’s never too early to begin the
loan application process. Much has changed with loans since
2008, and the best advice for a problem-free process is to work
locally. Ask your Realtor for a list of local lenders, mortgage
companies, banks.
4. Furnishings. The closer a property is to
the ski slope, the more likely it will be sold furnished. This
is because the property is likely a short-term rental or a
second home, and the seller does not have use for the
furnishings elsewhere. Sellers often have several furnishing
exclusions (personal items, art work), and the buyer should
fully understand what furnishings will be included/excluded at
the time the contract is written. Furnishings are transferred
via a bill of sale, usually with no dollar amount, and are not
part of the purchase price. Dealing with the furniture can make
for road blocks in negotiations, as buyers and sellers value the
furnishings differently. This is another good topic to discuss
with your Realtor.
5. Appraisals. All buyers have the right to
secure an appraisal(s) for the property being purchased, whether
they are securing a loan, purchasing with cash, or purchasing
through an owner carry. If working with a traditional lender,
the lender will order the appraisal. If the property does not
appraise to the full purchase price, the buyer has several
options: accept the lesser appraisal, re-open negotiations with
seller, terminate the contract.
6. Monthly Dues. If the property has a Home
Owner’s Association (HOA), there will likely be dues collected
on a monthly basis from all owners. The dues will cover such
items as cable, phone, wi-fi, electricity, gas, water, sewer,
phone, management, snow removal, trash removal, exterior
maintenance. Every association is different and it’s important
that a buyer understand exactly what is covered by the dues, and
what the owner will pay for on a regular basis, in addition to
the dues. Details on the dues will be found in the HOA documents
(Declarations, Covenants, Bylaws).
7. Market Statistics. How’s the market doing?
What are recent trends, trends in the past two years, trends
over the past decade? What are the recent comps in the
neighborhood you’re interested in? Request information on recent
sales and comparable listings. For Breckenridge and Summit
County statistics, click here.
8. HOA Assessments. From time to time, every
condo complex needs some upgrading – a new roof, new siding, new
decks or windows. If reserve funds are not collected in advance,
then assessments become necessary when improvements are
planned. Assessments will be discussed in the annual HOA
minutes or board meeting minutes; a review of minutes for the
previous two or three years should inform buyers of assessments
that are active or may be happening soon. Also, if current
assessments have not been paid in full, they need to be
addressed in the contract, so both buyer and seller agree on who
shall be responsible for them, long before everyone meets at the
closing table.
9. HOA Minutes, Budget, Finances. The seller is
responsible for providing the buyer with HOA documents, once the
property has gone under contract. A close review of the minutes
is especially important, so the buyer will understand what items
are on the HOA radar. Maybe there are parking issues, hottubs
that need replacing, or icy sidewalks that homeowners are not
happy with. Request at least two years of minutes, so that the
broader picture is understood.
10. Radon. Radon is a colorless, odorless
radioactive gas, emitted from uranium. It can occur most
anywhere, and because a home’s interior has a lower pressure
than the soil around the foundation, it’s not unusual to have
some low level of radon detected within the home. A home
inspector will do a radon test, upon request from the buyer, and
if radon is detected, then mitigation is recommended. For most
homes, mitigation is not expensive, and the seller usually
agrees to pay for and handle the process. A radon test should
be a standard part of the home buying process.
11. Mold. Mold can occur in any damp space that
provides a vehicle for growth – wood, drywall, carpeting, carpet
padding. Home inspectors are trained to recognize the tiny,
nearly invisible spots and accompanying smells that indicate
mold, as well as the conditions that may foster mold in the
future. Some molds are innocuous, others are life threatening.
Mold can be dormant or highly active, and an experienced home
inspector is your best bet to determine if a property
is infected. If mold is discovered, the usual process is
mitigation, ordered and paid for by the seller. Unlike radon,
mold can be very expensive to mitigate.
12. Surveys. There are several types of surveys
that could be provided for vacant land or a single family
residence: Improvement Location Certificate, Land Survey Plat,
Improvement Survey Plat, Topographic Survey, ALTA Land Title
Survey. A seller typically provides the buyer with some type of
survey, and the buyer should review it closely, make sure the
survey addresses any areas of concern. Buyers should take care
to be informed of recorded and apparent rights-of-way,
easements, and encroachments, as well as any conflicting
boundary evidence.
13. Water. Understand where your water is
coming from – is it city water or well water? If buying a home
that is connected to city water, you will pay a bi-monthly fee,
based on usage. If a water well is a home’s source of water, the
well and the water it’s producing should be inspected. If buying
vacant land, make sure water is available for the property –
either by tying into the local community source (city water), or
by drilling a well. Owners of vacant land do not automatically
have the right to drill a well if city water is not available –
make sure this topic is thoroughly discussed with your Realtor.
14. Sewer and Septic Systems. If you’re buying
a property in town, or in a newer subdivision, the property will
likely be tied to the local sewer system. If located outside of
town, or in an older neighborhood, a septic system and leach
filed may be part of the property. Septic systems/leach fields
must be designed specifically for the property they serve, based
on soil tests, size of property, wetlands, location of
neighboring systems, among other things. If buying vacant land
or a home with an existing septic system, some homework is in
order to understand your options (due to septic requirements,
some lots can’t have homes with more than two or three
bedrooms). Discuss this topic with your Realtor.
15. Transfer Tax. A transfer tax is a tax
collected at the time of purchase. Both Breckenridge and Frisco
(within town limits) have a 1% transfer tax (1% of purchase
price). Traditionally, the buyer paid this 1% tax at closing,
but in recent years, it’s become a negotiated item.
I make a point to spend as much time as necessary in educating
the buyers I work with – if you have questions on the buying
process, please get in touch, and let’s get to work.