Benjamin Briggs: Welcome to Business Innovators Magazine. Tell me something about yourself and your real estate history.
Larry Imm: I was originally licensed in Alaska in the late 70’s, worked for Century 21 for some time. I had just got married and was purchasing a home. Unfortunately, my wife was worried about a steady paycheck so I fell back on my culinary arts background. I now work for Jack White Real Estate.
Benjamin Briggs: What is your vision for real estate for the future?
Larry Imm: I think real estate is just like politics. It’s all local. For 2016, I think there’s a lot of healthy nervousness in the marketplace because of the economic situation with oil in Alaska.
Benjamin Briggs: What are the things I should look for when considering buying an investment property?
Larry Imm: You have to look at the cap rate, the return on your investment and the depreciation of the property. Is it going to return enough on your capital rate to satisfy your investment goals?
Benjamin Briggs: What about a private home?
Larry Imm: The three most important things when considering buying are location, location, location. Do you want it close to your work? Are you concerned with the schools? Do you want your property in a low traffic area? These are all factors which should be considered before purchasing a home.
Benjamin Briggs: Basically do your research and know where you want to live before committing?
Larry Imm: Absolutely. The one thing I would like to stress more than anything is just because a bank qualifies you for a $500,000 loan does not mean that you buy a $500,000 house.
Benjamin Briggs: What is the difference between being prequalified and preapproval?
Larry Imm: With either there is a prequalification letter or a 90 percent letter. This means that you’re 90% approved. As long as you go through the rest of the process and nothing unexpected comes up your loan should go through just fine. The mistake most people make is that they get a preapproval for a hypothetical $500,000 and find a $400,000 house and believe that they can go and buy a $60,000 truck because the bank says they’re worth $500,000. Because of the debt to income ratio will be affected, that truck will prevent you from buying that house. You should not be looking to make any other major purchases before the house closes. You want nothing going on with your credit except the purchase of the house because of debt to income ratios. You can save those purchases for another time.
Benjamin Briggs: What is the difference between an agent and a broker?
Larry Imm: The broker oversees the licensees in the office. The State of Alaska changed the term from agent to the term licensee a few years back. This was brought on by a lawsuit over representation. Everyone is now a licensee. You can have multiple assistant brokers, but you can only have one broker. He is the boss. All licensees are independent but they all answer to the broker.
Benjamin Briggs: What should I look for in a good licensee?
Larry Imm: I would look at a several things. One; I would look at their past performance and I would look at how well they communicated. Will you be able to get a hold of that person when you need them? Are you going to be able to deal with that person? There are a lot of teams now that handle many parts of the process but it all starts with the contract. You need to know who you are dealing with and how well that person communicates. Are they going to answer the phone when you call? I think this is absolutely critical. Our team can step in to help each other but whoever you deal with from the beginning is the person you will be dealing with throughout the transaction.
Benjamin Briggs: What would be the most important advice you can give a new buyer?
Larry Imm: Choose a licensee that you can trust and have faith in. It’s all about the relationship and the communication. You want to choose someone you are going to be able to contact six months after the deal is done if there is a problem.
Benjamin Briggs: Perhaps ten years from now?
Larry Imm: Absolutely. I know some people aren’t going to like it but I have to say that you have to choose a full-time licensee. Real estate isn’t a hobby that you do part-time. You wouldn’t hire a part-time surgeon, why would you hire a part-time licensee to be involved with the biggest financial decision that you will ever make. I think part-time licensees are the bane of the industry. You can’t get a hold of them because they are dedicated to another profession. The full-time licensee ends up having to take up the slack. Full-time licensees are dedicated to making a living so they are more focused on their clients’ needs.
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