Who, What and Why is Captain Realty?
A superhero born from the ashes of real estate's maligned past of deceit and superficiality, charged with the mission of bringing honesty and joy back to the home buying process.
Captain Realty is Seth Captain. And to avoid any confusion that this is being written by a gnome in India, we will change the distant 3rd person into the intimate 1st person. Seth is me. I am writing this.
I am a dedicated buyer's agent. And I chose this route for a simple reason: It's exciting and stimulating.
I pride myself on my knowledge of Chicago. Not who started the infamous fire or who was the last Cub to win a batting title, but rather knowledge that matters to a buyer. Blocks in Chicago have personality, just like the potential buyer. There are thousands of wonderful, architecturally rich blocks in this city, but like us, humans, each one has a distinct personality. There is a reason you don't have 492 close friends. You have a select group. Just a few. Because your uniqueness allows a very limited circle to connect with you. I apply this concept to home buying. I am the ultimate matchmaker.
An interest in architecture since childhood (my pre-teen bedroom had copies of “100 Building Plans for your Dream Home” and “Great American Architecture...Jefferson to Wright”) combined with years of travel spent exploring over eighty countries, where I spent months at a time getting to know locals from every conceivable culture, which in turn, gave me a more fundamental understanding of human nature along with the ability to seek out specific locales within a completely foreign environment, which...which, congealed with a two year employment for an international beverage company where I had the mission of introducing their drink to all of Chicago's 77+ diverse neighborhoods then eventually married to a brick three flat rehab project which created the superagent writing before you. Serving appreciative home buyers since 2004...
Why should we trust you?
In this industry, a very fair question. I'm a Helper. That's my personality type. Not a Taker. When somebody's car dies on the side of the road, I'm the guy that gets out to help them push. When somebody keeps dropping their over-loaded grocery bags, that's me who goes over to carry a few. I have been an active volunteer in Chicago for many years. Not just donating money, but actively participating with organizations on a weekly basis. Obver the years, my time has been divided between reading to the blind, teaching English to immigrants, community gardening, and reading stories to young children (see resources page for links). In more blunt terms, I care about my reputation. Without it, I have no business, which means I don't work. And I can't imagine anybody giving me a legitimate testimonial unless I found them the best possible property at the best possible price, within their budget and time frame. The testimonials page should help corroborate this.
Why don't you sell properties? Isn't it more lucrative? Aren't Buyers more difficult and time consuming?
Didn't I go over this? My interest in real estate is not to get wealthy, as evidenced by my modes of transportation. As Americans, we have the fortunate ability to choose professions that stimulate us. There is nothing stimulating about putting up a 'for sale' sign and opening a door. Yes, I do sell properties occasionally to help out clients who are interested in Buying something else, or clients who have particularly interesting property to show
Working with a buyer is to be an intrinsic part of the creative process, which is THE process that allows us to consciously participate in the marriage of mind, emotion, and the intangible (God, Spirit, Earth, ??). Most buyers approach me knowing the basics of what they want. Over time we eventually find the one material object that will carry the highest meaning, an object that is the result of whittling, sculpting, debating, prodding. A highly personalized object we call HOME. Who wouldn't want to be a part of that!
Is it true that you are selective in who you work with?
Yes, in the sense that I only have so many hours in the day, and I can't be all things to all people. I refuse to be over-extended. If I am unable to deliver 110% to a client, I am only doing a disservice to the client. And if a potential client has interests that aren't my specialties, like a suburban subdivision home, or a property they can flip in a year, then again, I am failing to be honest to either of us by working with a subject which I find uninspiring, and will result in a less than professional outcome.
What are your specialties?
Besides knowing how to properly cook broccoli, and ride a bicycle without hands...Working with Buyers to locate and purchase Multi-unit Buildings (including mixed use live/work spaces) and Vintage Single Family Homes, along with classic style lofts.
What's the deal with multi-unit buildings?
These are commonly referred to as two flats, three flats, etc. I feel they help a homeowner control his mortgage cost so that he or she can do other things with their life besides working endlessly to pay an extravagant mortgage. Depending on the building, an owner's rent can be reduced by half, or in some cases pay nothing. And even, if things line up, earn money every month. In addition, and this is huge, you choose your neighbors. Ask any condo owner how they feel about their neighbors, and you are bound to hear a litany of complaints. But in this situation, you are selecting tenants (without violating Fair Housing Rules) that create the vibe you want from your home. And they return it back to you. You are not paranoid about locking your door because you know everyone in your building. BBQ's and gardens bring you together and create a true community energy that is missing from so much of modern life. One more important aspect in Chicago is that owner occupied multi-units ensure that a block has a better chance of staying trouble free. Some of Chicago's problems are caused by residents who live in buildings with landlords who only care about a rent check and have no involvement on the block. Keeping buildings owner occupied lessens the risk of this.
Would it be difficult to rent out an apartment in my multi-unit?
Chicago is a major international city that has a high percentage of renters compared to the national average. People are constantly moving into, and eventually out of the city. Young professionals who aren't ready to marry, artists who enjoy the freedom to move, immigrant families who are still establishing themselves, working class families who can't meet tough loan requirements, students, interns and a general attitude of city dwellers to prioritize the 'exterior' life rather than the homebound one.
A thoroughly clean functioning apartment, NOT priced at the top of the rental market will always rent. I live in and own a 6 unit building that is neither next to the train or in one of the city's most desirableneighborhoods, and I have never had a unit empty for more than your typical 30 day turn-around process. This is typical of live-in owner buildings because a live-in owner selects his/her tenants with care, and prospective tenants know that their issues will be dealt with immediately and those looking to scam will stay away.
What about single family homes?
If you have sufficient income to not be married to your home, and not live paycheck to paycheck, then Chicago is full of some of the most delicious homes in America. Really, I never get sick of searching for homes here because there is always something intriguing. My interest lies in homes with either historical character or properties that show the potential to be transformed into a modern living space, along with truly unique spaces. So basically, anything that is 'new construction' (a pejorative term for homes built hastily, without regard to architectural detail or quality materials) is out. Otherwise, even a raised 50's ranch has the potential to be an open floor plan home with a cathedral ceiling and an abundance of light. I have the ability to help the home buyer envision a home's true potential. We'll talk it out. Draw it. Eventually, my buyer gets it.
How about Live Work Spaces?
These are sometimes referred to as mixed use properties. Or more commonly as "that place where that couple lives upstairs from their shop". These are abundant in Chicago and a great way for any artist, restaurant owner, shopkeeper, extreme hobbyist, or other entrepreneur to shorten their commute to a flight of stairs, or more practically speaking: be able to afford rent on their workplace. Some of these spaces have additional apartments for rent which helps reduce costs further. In certain instances, renters have found their new mortgage to be equivalent (or less) than their previous rent, except now their rent (mortgage payment) includes a work space and a giant tax deduction! Plus, I am able to introduce you to feasible ways to finance these properties.
For the person who doesn't have the time to maintain a property, and doesn't have an interest in being the master of their kingdom, then condos work. I just don't focus on them. There are some phenomenal loft buildings in the city, and other unique, often pre-war vintage, layouts that fit a certain type of buyer. These units I know, I love, and I will work with. But the majority of soulless condominium dwellings are not my interest, and I will not work with them due to my inability to deliver the service that customer would need.
Should I buy or rent?
Ahhh, realty's equivalent of “Is life only a dream?”
This question depends on perspective, and really specific things about the prospective purchaser. If somebody is averse to all risk, then he should keep renting. Owning a property means responsibility. There will be costs. Things will break. At least with your own home/building you can repair them as you see fit, and not at the mercy of a Condo Board.
Buying is for the person who wants to be in control of his or her home. You want to paint murals on your exterior walls, cover your ceiling in skylights, play death metal all night, grow rare orchids in your attic, have space for your studio...well, you'll need to own.
Buying gives you the chance to be truly vested in your neighborhood. Owners look out for their property, and in turn their neighbors. While renters may do the same, it's much easier for a renter to decide he won't be there next year, or this isn't mine, or some other "not my thing' issue, and abandon all notion of responsibility. There is a sense of community that comes from ownership because, in essence, each owner needs the other to maximize security and pleasure from their block.
Renting is great if you don't want to have the responsibility of home care. You also may end up spending less money since you shouldn't have to pay for any of the repairs, nor feel obligated to make upgrades. Home ownership will end costing more than you expect. Renting also lets you 'escape' with far more ease, but of course, you'll have to accept that a landlord can decide to raise your rent or simply not rent to you at any point, combined with being subject to his definition of maintenance which you may not like. There is never a guarantee with renting that your place will be there indefinitely.
There are tax advantages to buying, and an internet full of rent/buy calculators to make the financial decision. If you can safely afford the mortgage (not left with nothing in the bank after paying it), crave a bigger role in your community, and you want to create your own unique living space while being able to live with ownership's responsibility, then you are ready!
How much money will I make?
Real estate is never a sure bet when it comes to investment. You should know your earning potential, and if you are unable to comfortably pay the projected mortgage payments, then you need to look at less expensive homes, or perhaps, not buy at all. If you are buying only because you are convinced you will make X amount of money in the future then you should beware. You don't expect your car, or your clothes, or your computer to return money. Earning money from your home, or gaining equity to borrow is a huge advantage of buying, but it's also a risk. There is no guarantee of that return, depsite making every possible effort to pay a fair market value. The guarantee is that you will be in charge of your residence. Pride in ownership is not a b.s. cliché. It's a real feeling that just about any homeowner will describe.
How much do these services cost?
Nothing! Well, sort of. This is a complicated and somewhat controversial part of the business. Approximately 85-90% of sellers use real estate agents (or the MLS). The seller agrees to pay the their agent a commission for selling the property. The seller's agent, will share some part of that commission with another licensed agent. Therefore, the buyer isn't paying, the seller is. But the controversy is how does the buyer know I am representing their best interests and not the sellers, just so I can get paid. The best answer lies in my testimonials. Because telling a buyer to trust me, or explaining my background isn't good enough.
And because homes have been sold with realtors, and commissions, for over a century, home price comparables, what drive home prices, are determined with commissions built in. Which means the unrepresented buyer either gets screwed by an unrepresented seller who doesn't factor that into the negotiation or the dual agent seller's rep who pockets the whole commission for himself all while telling you he isn't since it's not required to disclose how much commission the agent is receiving from the seller. Ugh!!
So either I choose to make a living elsewhere, or I accept the system is flawed and attempt to do my absolute best for clients who would typically get screwed if they navigated the system solo.
And when the seller is selling without a realtor? I will inform the seller that I want to negotiate the commission into the sale price. At that moment, the buyer will have the option of agreeing, or paying a negotiated rate outside of the sale price, or continuing the purchase process alone, with no hard feelings.
How does the home buying process start?
A fairy will arrive at your bedside and inject you with a serum. 24-36 hours later a calming glow willrise in your body, and then you will call me.
The most important step: Financing. How will you pay for this thing? If you don't have access to alot of cash, then you will need a bank to finance the purchase. This is the mortgage. There are banks and mortgage brokers that provide these loans. They are both legitimate ways to obtain a mortgage. The most important question is: Reputation of the loan officer. Like a realtor, this individual will be responsible to make sure that your loan goes through. A simple pre-approval is just one part of the process. There are many hiccups in the financing process due to tempermental appraisals, finicky underwriting departments, and changes in a borrower's financial history. A thorough and honest loan officer (mortgage broker), with competitive fees, who can competently communicate in a timely manner, will make sure they deliver on what they promise you.
And if I want to borrow money to renovate? The most popular way buyers borrow money to renovate is through a renovation loan, most notably an FHA 203k loan, among other options. The general idea is that you will get a licensed contractor to give you a price for the work you'd like done on your new home. The price of the work and the price of the home are added together. You'll be charged a slightly higher interest rate than non-renovation loans, but not exorbitantly. Then this rehab money is released to the contractor after your closing, but only as the work is completed insuring that you don't get screwed (nor the contractor). Some people will re-finance into a cheaper loan after the work is completed since many times the renovation can give you instant equity in your new home.
Budget: If you are approved to borrow, most likely it will be for more than you would like to spend a month. So, you need to take a look at your monthly expenses, from groceries to typical credit card bills, to acceptable savings, to cupcake purchases. Figure out how much you are willing to allocate to 'rent'. This number will include all money toward the monthly expense of a home, which will be the principal and interest on the loan, the property taxes, home insurance, and utilities. How the heck does that work?
The bank approves you for a $300,000 purchase. At 5% interest rate, and 5% down, with $5,000 yearly property tax and $1000 yearly home insurance and mortgage insurance, your payment would be about $2280 a month. Utility use always varies, but for only electric, water, and gas, an average of at least $200 should be expected. If you are only comfortable with a total of $2000 a month total, you need towork backward with the mortgage calculator. That would give you a budget of $220,000 with utilities or $250,000 without utilities. This is the number we want to work with. What makes you comfortable not the bank. Keep in mind, any monthly amount greater than 1/3 of your take home pay is considered too risky.
Meeting: We get together, and spend time discussing what you like and don't like about Chicago. What you absolutely need, what you'd like to have, and what you better never see. We'll discuss the neigbhorhoods and housing types that fit into your budget. We'll learn about each other's lives. And in the end, we will have begun a relationship that usually lasts until well after your home purchase. Because without understanding you, in the context of where you'd like to live, we are unable to create the harmonious relationship necessary to successfully locate the right dwelling.
House Hunting: We begin the tour. Ideally by bike or foot to truly understand the block by block nature of Chicago (weather, time and endurance permitting, but we'll always drive when the client requests so). First we'll see a general selection of properties to get you familiar with the possibilities that might work for you. Never write anything off until we walk inside and know for sure that a certain style of property will not accommodate your interests. Week by week our housing tours will diminish until we have figured out exactly what type of property and location will work for you. Then it's just a waiting game for the right place at the right price.
How Long? There is no true average, with buyers finding their home in as little as one week until longer than a year. Most buyers will find a suitable home within 1-2 months from the time we begin our searches.
The Offer: Once we know we've found 'The One', we'll examine other similar properties that sold in the area to determine a negotiating strategy, and submit a contract. We'll normally go back for a second look to make sure emotions didn't trump reality. The negotiating will sometimes take days depending on the seller's situation. And we might lose it to a higher bidder. Always remember this: In the city of Chicago, there are almost endless options in regards to housing, and it's unheard of to not find another 'One'. Sometimes, we have to wait, and wait, but in the end, you'll find a home that has attributes the previous home didn't, and you'll fall in love all over again.
Earnest Money: This is fancy way of saying 'deposit'. After the offer, it gets coughed up. If it didn't exist, people would write contracts all day and just walk away from them for any reason. The amount is negotiable, and sometimes can be as little as $1,000. It is deducted from your down payment so it's not extra money. And it's extremely well protected in Illinois. As long as the contract rules are followed, it's as easy to get refunded as a trip back to the Home Depot .
The Inspection: In the first week after our contract is accepted, we'll have a home inspection performed to determine if the home needs repairs, and if those repairs are reason to either back away from the deal, or get a price reduction, both of which are possible in our contract terms. This is very important: The inspector works for you, NOT me. It is an additional insurance policy that I didn't talk anybody into anything they didn't want, not to mention an assessment of your future home that you'll have as a checklist for future maintenance work. I don't want an inspector to rubber stamp anything. I have that reputation thing to live with! And when a knowledgeable inpsector gets into a crawl space, or an attic, or on the roof, we learn things fundamental to a home's structural condition. Sometimes they are items that all old homes deal with but other times the failing items could seriously cause a financial dent in the near future. I support this portion of the home buying process strongly, and I insist the buyers hire a non-partisan inspector and are present to learn all facets of their new home.
The Attorney: You'll want an attorney to act as one more additional insurance policy. This is by far the most expensive purchase that most people will make. And for the relatively low amount that real estate attorneys charge (this is not the $250 hour world of law), it's worth every penny. The attorney ensures that no funny business ocurred with the contract, that any inspection issues are taken care of, and most importantly, they are a safeguard for hiccups that may occur so that nobody can take unjustly affect your transaction.
The Financing, Part II: You thought you were pre-approved...well, now is the real part. The home has to appraise according the lender's standards. Your credit and work history are scrutinized more finely, and we simply have to wait. We will have triple checked with your lender before this process to assure, to the best of anyone's foresight, that we don't encounter issues beyond our control. But a committed loan officer will do whatever is humanly possible to solve the occasional issues that do arise.
Closing: On average, short sales excluded, we can close thirty days after our offer is accepted. We go back to the home the morning of closing to make sure any repairs have been completed, and nothing is vandalized. Then you, the presumed new buyer, will spend hours signing papers and papers. Eventually the seller will get a check, and you will get keys. We'll celebrate with cocktail wienies minus the wienies. And you'll live happily ever after!
And as a Bonus: Mortgages are paid in arrears, meaning you pay for the preceding month. And almost always, the mortgage isn't due until the 15th of the month. So if you close May 1st, your first payment isn't due until June 15th. And if you were to close, say April 10th, you would owe interest for the remainder of April but this can get included in your closing costs meaning you can have two months to get your new home ready WITHOUT paying rent (sort of)!