“Big-Wild-Alaska” Home Buying Tips from the Last Frontier

	Dan Wolf
	Tel: (907) 248-9653 Fix: (907) 865-6515 Email: [email protected] Website: www.anchoragehomesearch.com	Tweet

 

“Big-Wild-Alaska” Home Buying Tips from the Last Frontier

 

It is a great time to buy a home in Anchorage, Alaska!

 

When I talk with people they often ask what it’s like to live in Alaska.  They have formed opinions and stereotypes from television shows like Northern Exposures and dramatic big screen movies which have set impressions for many people about life in Alaska.  Living in Anchorage is similar to living in many mid-west cities.  Yes, we do have short days and long nights in the winter.  The worst being in late December and January; the sun is low on the horizon and daylight starts about 9:30am and is dusk at 3:30pm for 6 hours of daylight, but that condition doesn’t last very long.  In fact the days start to get longer by 5 or more minutes a day and soon it’s summer!  They call Alaska “The Land of the Midnight Sun” and yes, it barely gets dark in the summer!  I know it is a little different, but you learn to love it!  As far as cold goes, Anchorage often has better weather than found in Illinois and Wisconsin in the winter time!

 

There are many great things about living in Anchorage, Alaska:

*        We have no State income tax;

 

*        There is no goods and service tax in Anchorage; there are some other communities in Alaska that do have a sales tax on certain items.

 

*        There is no transfer tax on the sale of real estate.  In many areas of the U.S., cities impose a fee at the closing for the transfer of a property between the seller and buyer.  Anchorage does not.

 

*        In fact, you may have heard of the “Alaska Permanent Fund.” This is a fund of money put in place by oil companies developing Alaska’s oil reserves in the far “North Slope” of Alaska.  This money pays interest and dividends which are distributed each year between qualifying Alaska residents.  It varies every year, but permanent fund distributions to residents are often over $1,000 a year and have been as high as high as $2,069 in 2008.

 

Alaska is a young State; we became a State in 1959.  You’ll quickly notice there are very few old homes; in fact a home built in 1950 would be old by Anchorage home standards!  When you are looking for a home, you’ll appreciate seeing relatively newer homes that don’t need big remodels before you can live in them!

 

Alaska is a growing State.  The population has grown steadily over the past 20 years.  Between 2000 and 2008 the population grew an average of 1.3% each year.  Population gains were even stronger in 2009 with a 2.4% population increase.  The most recent population estimates for Anchorage showed the city’s population surpassing 300,000 in 2010.  The likely explanation for this small surge in population is that Anchorage has been a relative bright spot economically compared to job markets elsewhere.  People who found themselves out of work were drawn to the growing economy in Anchorage.  Another telling sign that Alaska’s real estate market has remained relatively stable is that currently less than 3% of the listings are foreclosures.  Many of the foreclosures, if priced correctly, will receive multiple offers from buyers.

 

Average sales prices for single-family homes and condominiums in Anchorage have remained remarkably stable.  This is due to a couple of reasons.  One, price growth has been modest, thus Alaska didn’t have the “bubble effect” that some lower 48 cities had; if homes didn’t shoot up in price very far, they didn’t lose much when the air went out of the balloon.  The other stabilizing fact is most loans in Alaska were conservative 30 year fixed rate mortgages, not the riskier adjustable rate loans and creative sub-prime loans that created such anguish in other markets.  In Anchorage, the average sale price is $328,952 for a 3 bedroom, 2 bath home with a double garage.  The average market time is 72 days on market.

 

Alaska is a young, vibrant and growing State and Anchorage is a normal city like most in the Pacific Northwest – except that you can get to remote Alaska in an hour out of town!  Our economy has been slowly growing over the past 20 years with slow steady growth.  Our homes are mostly newer construction because we are a young community and built with strict building codes to provide safe, economical and long term housing. In many ways, Alaska is the land the big recession bypassed!

To buy a home at the best possible price there are definite steps to follow to insure your success.

 

Get pre-qualified for a mortgage. In Anchorage lenders issue a “pre-qualify” or even “pre-approval” letters which are commonly called 90% letters.  This means that as long as the title is clear and the home will appraise and pass the home inspection, you, as the buyer are going to be able to close.  This letter sends a strong message to the seller that you are “ready, willing, and able” to follow through on your written offer to purchase.

 

Team with a real estate professional to help you with neighborhood knowledge, financing knowledge, school advice as well as tried and true negotiation expertise.  My website is www.Alaskanhome.com. A strong agent will be well respected by other agents in the market place and will be able to present your offer in the strongest possible way.

 

Don’t plan on buying the first day out. Even if you see a home you like right away, plan to look at similar homes to really get a feel for the market.  After seeing homes that meet your parameters, you’ll learn to know what a good deal looks like!

 

Don’t be afraid to purchase in the winter. Homes sell all year long.  The market naturally slows down late in the year in Anchorage because the days are shorter and people get busy with the holidays, but there are good buys to be had in the winter too! Because of fewer buyers in the market, sellers have to sharpen their pencil on price and are often more negotiable because of fewer showings on their property.

 

Once you find a house you like, don’t think about it too long! I’ve seen it happen many times.  The home could be have been on the market for quite a while and once you fall in love with it, other buyers seem to come out of the woodwork.

 

Be able to make your offer without contingencies, except for the “duty of inspection” things like home inspections, clear title, and review of any common ownership documents.  An example of contingencies that can work against your offer can be things the seller can’t control, for instance “this offer is subject to buyer getting a divorce” or “this offer is subject to buyer being able to sell a vehicle to obtain down-payment.”

 

Write a “clean” offer. The seller will most likely respond favorably to an offer that doesn’t have extra clauses written in the offer.  For instance, “seller to professionally clean the house upon vacating” is less wordy and more appealing compared to “seller to wash all the windows, empty the garbage under the deck, steam clean the carpets, oil the cabinets, etc.”  Try to keep the text of the offer to a minimum for a more favorable response from the seller!

 

Keep a close eye on new listings as they come on the market.  Your agent can make sure you don’t miss anything as long as you commit to them and give them accurate home parameters such as number of bedrooms, areas of town, schools and price of home not to exceed.  The best priced homes in the best neighborhoods tend to get the most attention from other buyers and their agents.

 

Read and Question the Sellers Home Disclosure.  Sellers are required to disclose what they know about the home.  The required Sellers Disclosure asks specific questions about the foundation, the roof, water issues and many other things.  If a question isn’t answered on the form, through your agent ask why the question was left blank.  There might be something the seller doesn’t want to answer!

 

Get a home inspection! It might seem obvious, but most agents have a story about someone who thought there might not be a good reason to spend the money, only to later find a problem they wish they had discovered earlier.

 

These are just a few tips to help find the uncommon deal in Alaska.  Please contact me for specific help.  My website is www.AnchorageHomeSearch.com .