Real estate lingo defined: What is due diligence?

After a long, grueling search, including several overheated bidding wars, Jim and Claire found the California home of their dreams. They were ecstatic when their offer was accepted and the transaction sailed to an effortless close.

As summer settled in, it was time to crank up the air-conditioner. Curiously, they couldn’t find the thermostat for it. Sure, there was a thermostat for the heater and, isn’t the cooling system typically attached to it?

After searching the entire home, they came up empty. The HVAC system was missing the AC side of the equation—there was no air-conditioning system in the home, despite the MLS listing claiming otherwise.

Who gets the blame?

It’s easy to assume that the listing agent and/or her broker were to blame for this. After all, the box on the MLS listing, right there next to “central air conditioning,” was checked.

Perhaps the homeowners should’ve caught the MLS mistake and brought it to their agent’s attention? If so, perhaps they’re to blame.

In the end, after mediation, the buyers were found to be at fault.

Why?

They didn’t perform adequate “due diligence”

Huh?

Caveat Emptor

You’ve most likely heard the Latin term for “let the buyer beware.” But, did you know that it’s part of a longer statement that admonishes buyers to “beware, for he ought not to be ignorant of the nature of the property which he is buying from another party?”

According to FindLaw.com, there is an assumption, under law, that a buyer of any product will inspect it completely before consummating the purchase.

“This does not, however, give sellers the green light to actively engage in fraudulent transactions,” according to findlaw.com, but it does put a lot of responsibility on buyers’ shoulders.

And, in this case, the mediator found no evidence that the sellers acted fraudulently.

The due diligence period

This time period extends from the minute the seller accepts the offer to when the last contract contingency is removed.

Homebuyers are, therefore, given ample time to perform due diligence. They are even afforded the opportunity to request additional time, if needed.

During this period, the buyer will have the home inspected, shop for insurance and examine HOA documents (if applicable), the lender will work on the buyer’s loan and have the home appraised and the title company will investigate the home’s title.

The buyer, who receives copies of inspection reports, appraisal information and the title search, is well-armed with information during the due diligence period. Savvy buyers will personally inspect the home as well, which Jim and Claire did, twice.

Before the last contingency is removed, the buyer has the opportunity to negotiate with the seller for repairs or the money to have the work performed by someone else. If this doesn’t occur, and the contingency is removed, the buyers are agreeing to take the home as-is.

And, it’s expected that they know what they’re getting into.

Jim and Claire lost their case at mediation, and here’s why:

There was no evidence that the seller exhibited fraudulent behavior. His property disclosure noted that there was no central air conditioning. The buyers either didn’t read the disclosure or ignored what was stated.

The home inspector noted the lack of central air conditioning. Why any homebuyer wouldn’t thoroughly read home inspection results is mind-boggling, but apparently, Jim and Claire didn’t.

The buyers personally inspected the home on two separate occasions and performed an additional final walk-through before closing. While it would be too late to seek remedy after the final walk-through, the prior two inspections fall under the umbrella of performing due diligence.

Don’t let it happen to you

It can happen to even the most experienced homebuyer. It’s easy to be so excited by the fact that you finally found THE home that you either don’t notice or overlook its flaws.

While Jim and Claire’s own real estate agent should have noticed a feature that the couple told her they wanted, in the end it all came down to their negligence.

Buying real estate, even for personal use, is a financial investment. Treat it as such by forcing yourself to leave the emotions aside and approach the purchase with all the seriousness it requires.

Is mold lurking in your home?

Mold – it’s unsightly (when it’s visible) and it’s unhealthy – and, if it’s in our homes, it is present in every breath we take.

Many of us only think of mold in the cold and damp of winter. But, spring weather can also cause a host of problems in our homes and mold is one of them. Not only that, spring is the ideal time to perform mold remediation, according to the experts.

What is mold and how does it get into our homes?

Molds are microscopic fungi that feed on and break down organic materials. In our homes, “They like cellulose. Most of the material we use to build houses – like sheetrock, ceiling tile, wood,” David Straus, a mold expert with Texas Tech University, explained.

But they need moisture to thrive. In fact, according to the U.S. Environmental Protection Agency (EPA), of all the types of mold in the world, “none of them will grow without water or moisture.”

When conditions are right (moisture, temperature and the presence of organic materials) mold will spread by releasing spores.

Mold exposure symptoms

Symptoms of mold exposure can be as mild as those of seasonal allergies to flu-like symptoms and even the loss of equilibrium, trouble breathing and other life-threatening signs.

Asthma-like wheezing, especially in those not previously diagnosed as asthmatic, is a clear sign that mold may be present in the home.

Diagnosing a mold problem in the home

Mold can be apparent (black substances on the walls), or it can be hidden, such as under carpet pads, furniture and wallpaper.

A common misconception is that mold is black. While it often is, it can also be green, pink or appear as white powder.

The most telling sign of a mold infestation in the home is a musty smell, according to the Minnesota Department of Health.

How to get rid of mold in the home

The experts at the EPA caution that there is no way to rid the home of all mold, but you can control its growth by ridding the home of excess moisture.

This may be easier said than done, however. As mentioned earlier, it is sometimes challenging to find mold, and to remedy the problem you must find the source.

Begin with the places that most commonly experience leaks, such as around the toilets, showers and sinks. Then, inspect the following:

  • Cracks are notorious for allowing water to seep into the home. Check the walls (especially in the basement) and ceilings and the exterior siding for signs of water intrusion.
  • Check the attic for signs of moisture.
  • Inspect anything stored in boxes, such as clothing.
  • Stored furniture may be harboring mold as well.

Once you’ve rid the home of moisture sources, it’s time to clean up the mold. This can be a DIY project, but health experts suggest that you call in a professional mold remediation company for a large infestation.

If you decide on the DIY solution, wear protective clothing and gear, such as gloves, eye protection and a filtering dust mask. Then, follow the advice of the New York State Department of Health:

  • Dry off all wet or damp surfaces.
  • Remove items with mold from the home and discard them. This includes ceiling tiles, carpeting and drywall.
  • Remove mold from hard surfaces by wiping them down with a solution consisting of ½ cup borax in one gallon of water (you can purchase borax online at amazon.com and it’s often available at Walmart and Target).
  • If the surface is frequently in contact with moisture, use a bleach/water solution (12.8 ounces of bleach with one gallon of water). Keep checking the area for future mold growth and apply the solution again, if needed.

Prevent mold infestations in the home

Prevent mold growth by reducing the amount of indoor humidity in the home. The EPA suggests ensuring that there is adequate ventilation in laundry rooms and bathrooms.

Then, if needed, consider purchasing a de-humidifying system to clear the air of excess moisture.

You can find additional mold information online, at the Centers for Disease Control and Prevention’s and at the U.S. Department of Housing and Urban Development’s websites.

How to survive – and win – during the spring homebuying season

Working with first-time buyers and those on tight budgets during last spring’s overheated sellers’ market was heartbreaking. So many offers made and so many passed over for someone else’s.

One of the most frequently-asked questions we received was

“Aside from increasing the amount of money we’re offering, what else can we do to win in a multiple-offer situation?”

As we head into the spring 2018 season, we will no doubt hear this question again, so today we want to share with you some tips that just might win you that home.

Write a personal letter to the seller

Letters to the seller get a bad rap from some in the industry, but we’ve found them to be quite effective.

Ensure that the letter will connect emotionally with the seller. Explain, specifically, why you love the home and how living in it will affect your family.

Personal letters are especially effective when accompanied by a photograph of yourself and, if you have one, your family.

Need ideas? Housingwire.com recently published some sample letters that might just do the trick.

Don’t nickel and dime the seller over the small stuff

It’s tempting to want the seller to fix even the little things that show up on a home inspection report. If you truly love the home, and the inspection report doesn’t show any major problems, avoid that temptation and leave out requests that the seller make or pay for repairs.

The cleaner your offer, the more likely it will stand out among others. And, after price, the seller will look at other aspects of the contract that will cost him or her money when deciding on which offer to accept.

Increase your earnest money deposit

What sellers want most, aside from the most money possible, is to know that when they take the home off the market after getting an offer, the sale will go through.

To reassure the seller that you are serious about the purchase, increase the amount of your earnest money deposit.

The earnest money deposit, by the way, is a cash deposit – typically a certain percentage of the offering price.

It’s held in escrow and applied toward the purchase price at closing. It can, however, be forfeited if you breach the contract.

An increase in good faith money shows an increase in good faith – and sellers love that.

Agree to be flexible with your closing date

Believe it or not, we’ve seen buyers win a bidding war against higher offers just by being flexible on the closing date.

Many sellers need more time to move out, so offering to close on their preferred date, or even to rent back the home to them after closing, may be a way to win in a multiple offer situation.

If the home is vacant, offer to close quicker, if possible. Of course, you’ll need to get with your lender to determine how quickly you can close, but this is an attractive offer to a seller with carrying costs inherent in a vacant home.

If all else fails

If you’ve ever been in a multiple-offer situation you know that the seller may find another offer to purchase more attractive than yours. If this is the home of your dreams, consider making a backup offer which will put you next in line if the chosen buyer backs out of the purchase.

The backup offer, when accepted by the seller, is a binding contract, so make sure you have your lending in order before submitting it.

Sure, it sounds like a long shot but back-up offers frequently become primary offers so they’re worth considering when the home is exactly what you want.

Still have questions? Reach out to us – we love talking about real estate!

7 critical aspects of buying farm or ranch property

When the home you want to buy is merely a shelter to retreat to after a day spent ranching or farming the land surrounding it, you’ll find that the process is much more involved than buying a tract home.

While we don’t have space here to get into the fine details of this type of real estate purchase, here are a few basic steps to take when buying farm or ranch property.

1. Where will you get the money?

Not all lenders deal with ranch or farm properties, so you’ll need to find one who does. If you need help coming up with the money to buy a farm, contact the state’s Department of Agriculture about the Beginning Farm & Ranch Loan Program.

It offers beginning ranchers and farmers a reduced interest rate and a reasonable down payment. You can find the eligibility requirements here.

The USDA offers farm loan programs (including a special program for women and minority borrowers) and some conventional lenders, such as Janus Ag Finance (an outlet for Farmer Mac) and Compeer Financial, have programs for potential ranch and farm owners. (We do not endorse these lenders; the mention is for informational purposes only).

2. How much land and how many critters?

One of the first steps to take when you find a ranch or farm property you’re interested in is to figure out if it’s the right size for the number of animals you hope to keep. The easiest way to do this is to contact the USDA’s Farm Service Agency.

3. Zoning considerations

Next, you’ll need to ensure that the property is located in the proper zoning district (agricultural) and that it’s also zoned for the livestock you’ll keep there. You’ll find zoning information for your city or county on its website.

If you go in person, request a parcel map so you can look for easements. This is especially important if you’re buying property that has never held a structure before.

It’s not at all uncommon for vacant parcels to be landlocked and if there is no existing easement to allow for ingress and egress you’ll need to go about procuring one, which is not an easy project.

4. Water rights

Is there water on or running through the property? Your next stop, then is at the state engineer’s office.

Find out how they determine water rights (also known as “riparian rights.”) This is important if you plan on pumping water to store or use it for livestock.

5. Drinking water and waste management

Buying a ranch or farm typically brings with it the expense of having the well and the septic system inspected. Despite the expense, it’s important to have the septic pumped out and thoroughly inspected.

If you need to install a system, you’ll want to have the soil tested (a “percolation” test) to determine if the land will support the size of the system you have in mind.

Lenders often require water quality tests for farm and ranch purchases. Even if yours doesn’t, do consider hiring a professional to ensure the well’s mechanics work properly and that the water is safe to drink.

6. Are crops or grazing areas planned?

A soil test is a must for those planning on growing crops or providing a pasture for grazing. You’ll find invaluable information online with the Natural Resource Conservation Service’s Web Soil Survey.

Soil testing results are especially useful if you’re interested in organic farming. Cooperative Extension Services across the country often offer soil testing. Consult the list at gardenologist.org to find the one closest to the property you’re interested in.

7. Infrastructure considerations

Barns and other outbuildings on the property should be professionally inspected. If the property lacks the buildings you require, factor the cost of erecting them into your offer. Likewise with fences and irrigation that needs to be installed.

 

What is a title search and why should I care?

Ok, so you got an offer on your home. Although this is the right time to heave a sigh of relief, we’re not yet ready to pop open the champagne.

We don’t mean to sound like Debbie Downers here, but there are several potential hazard areas on the way to closing.

One that is seldom discussed is the title report. So, today we walk you through the process. “Knowledge is power” is a saying that pertains to every real estate transaction – so let’s bring you up to speed.

Just what is “title” anyway?

The word “title” in real estate refers to the parties who hold legal ownership and have the right to use and dispose of a piece of property.

The word is used the same when it comes to your car. When you sell your car, you’ll be signing the title over to the buyer.

But, what if you aren’t the true owner of the home, yet you’re attempting to sell it?

This is where the title company comes into play; searching public records to ensure that you are the legitimate owner of the property and that no other party has a claim to it.

Once they’ve assured that you are, indeed, the owner, they will issue a title insurance policy to the lender, to protect it against future claims against the property.

While the lender’s policy is a requirement of getting the loan, there is a separate, owner’s policy available to purchase, but it isn’t a requirement.

Title issues

“Title companies report that in more than one-third of all real estate transactions they must undertake ‘extraordinary work’ to address title issues,” according to Sandy Gadow in the Washington Post.

Some of this work involves searching far back into the public records, looking at divorce proceedings, bankruptcy filings, old deeds, wills and tax records.

If they find an issue, regardless of how insignificant it may seem, it becomes what is known as a “cloud” or “defect” on the title and it must be cleared before the sale of the home can be finalized. Some of these issues include:

  • Unpaid property taxes
  • Fraud and forgery
  • Missing signatures on the title
  • Previous owner’s heir making a claim

You can find a list of common title defects online, at firstam.com.

Dealing with clouds on the title

When the title search is complete, the title company issues a Preliminary Title Report. In it, you’ll find information about the ownership of the property and any outstanding liens and encumbrances against it.

The report provides the seller the opportunity to not only learn about previously unknown defects in the property’s title, but to cure them as well.

After all, no sane buyer will want to continue with the purchase of a property with title issues.

Note that the Preliminary Title Report may not list all existing liens and encumbrances affecting title to the property.

It simply states those it was able to unearth and that the company will exclude these items from coverage in a subsequently issued title insurance policy, if they aren’t remedied.

Think of it as an “offer to insure,” according to the California Land Title Association.

Sellers need to carefully examine the preliminary report and, working with their agent or attorney, take action to clear up any problems.

For instance, one of the most common problems title companies see is an old mechanic’s lien. These are routinely placed on a property by a general contractor before starting a rehab or other home improvement project (to ensure he or she is paid).

In an ideal world, the contractor will release the lien upon payment for his or her services.

But, as you know, the world isn’t perfect and contractors often neglect releasing the lien. While it’s typically not difficult to resolve this title defect, it does take time, so the closing date may have to be extended.

The insurance

If the title search doesn’t find any problems, or you clear up those that have been found, the title company will issue a lender’s title insurance policy and, if purchased, one for the new homeowner.

Unlike other forms of insurance, title insurance only requires one payment, at closing, and it lasts for the life of the loan.

Please feel free to reach out to us if you have any questions about the title insurance process or anything else real estate-related. We’re happy to answer questions.

3 reasons to sell your home NOW!

I have a friend in another state who wants to sell her home. And, whether a blessing or a curse, she has the luxury of taking her time.

In other words, she doesn’t need to relocate for a new job, she’s not getting a divorce and she’s not in escrow on another home.

So, suffering from “analysis paralysis,” she drags her feet. She also burns up her cellphone calling me for news on what the market is doing.

She’s waiting for that perfect time. You know the one—when home prices are the highest they’ll get.

Sound familiar? If so, keep in mind these famous words from a not-so-famous real estate agent (me):

“Trying to time the real estate market is crazy.”

By the time you learn that home prices have maxed out, it will be too late – they’ll be on the downhill slide.

But, if you insist on trying to time the sale of your home to the optimal time, here’s more advice – this time it comes from just about every real estate agent with a heartbeat:

“Now is the best time to sell your home!”

Yeah, I cringe when I read that too. But, right now, the advice actually has merit. And, here are 3 reasons why.

The inventory of available homes is scary-low

In fact, one of the major online real estate portals finds that in 2017’s fourth quarter, the nationwide inventory of available homes fell by 10.5 percent, which is the steepest drop in inventory since 2013.

The biggest drop was in starter homes but move-up homes are also experiencing a dearth of listings.

What does this mean for you as a homeowner thinking of selling? If the inventory remains suppressed as we head into the spring homebuying season, and demand remains high, you’ll be very happy with your home’s current market value.

Home prices are high

“Listing prices have once again begun their seasonal climb and have quickly reclaimed historical highs,” claims a new report from realtor.com®.

The data also suggests that homes are selling nearly 10 percent quicker than they did last year at this time, despite the price appreciation.

The shrinking inventory is expected to continue to drive up prices throughout the spring homebuying season.

Consider this: list your home soon and you’ll be in the driver’s seat, not only because you’ll get more for your home now than if you wait, but you will also have the luxury of dictating the terms of the purchase agreement.

Need to wait to close until the purchase of the new home is finalized? You’ll find a buyer willing to accommodate you. If you wait until the market changes to a buyers’ market (which it can do on a dime), you lose this advantage.

Interest rates WILL go up

If there is anything that acts as an impetus for homebuyers to speed up the home search it’s news that mortgage rates are set to increase.

A recent study by a large real estate corporation shows that only 6 percent of potential homebuyers will cancel their plans to buy a home if interest rates rise above 5 percent and 21 percent say that the increase would cause them to speed up their plans to purchase.

The more alarming statistic, however, is the 27 percent who say that an increase that high will cause them to slow down their search until rates come back down.

If you need to sell your home, losing more than a quarter of the buyer pool is bad news. The more buyers that drop out on the demand side of the supply/demand equation, the quicker the market will change.

And, if you’re planning on buying another home, a rate hike between now and then could put a real pinch in your budget.

Count on mortgage rates continuing to climb this year. “The 30-year rate has been on a tear in 2018, climbing 48 basis points since the start of the year and increasing for eight consecutive weeks,” according to a statement by Len Kiefer, deputy chief economist at Freddie Mac.

If you are planning on selling your home this year, do it now, before the market turns against you.

We’re happy to offer you a free evaluation of your home’s current market value.

7 reasons why you shouldn’t rule out buying a condo

Don’t let a skimpy homebuying budget stop you from kicking your landlord to the curb. When even the most basic of starter homes soar in price, there’s always the trusty condo to fill the void.

If you’re opposed to even the thought of condo living, consider the purchase a stepping stone – a way to build equity to use for your forever home.

Read on to learn about more good reasons to consider buying a condo.

1. Cheaper than a house

Unless you lust after the penthouse unit in the city’s premier condo community, you’ll pay less for a condo than a single-family home. And, if you shop wisely, even that homeowners association fee tacked onto the mortgage payment won’t put you outside your comfort zone.

If you’re extremely low-budget, we can help you shop for a condo with low HOA dues. These are typically condos in low-amenity communities. In other words, you generally won’t find low HOA fees in a community that offers valet parking, private elevators and high-end fitness facilities.

2. On-site amenities

On the flip side, if the private elevator, valet parking and high-end fitness center is on your wish list, you’ll find condo communities that offer these amenities (and more) with homes far less expensive than buying a single-family home with the same amenities.

Yes, the HOA fees will be higher, but, again, your final monthly payment as a homeowner will be less than it would be if you owned a single-family home with similar amenities.

3. Low maintenance living has its perks

While there are some condo communities that offer homes with private yards, most don’t. This means no lawn to mow, weeds to pull, leaves to rake and trees to prune.

Part of your HOA fees cover the cost of common area landscape care. If the community has a pool, the HOA takes care of its maintenance, too.

Think of all the free time you’ll have compared to your friends who own single-family homes. Your weekends will be maintenance-free.

4. Be social, or don’t

Ask any of your single-family-home-dwelling-friends how many of their neighbors they know. Sadly, the answer will most likely be anywhere from none to very few.

Sure, there are vibrant neighborhoods with connected neighbors, but by and large, most Americans tend to isolate themselves from those who live nearby.

In fact, a Pew Research study finds that only 28 percent of people living in a neighborhood know their neighbors by name.

Condo living puts you in closer proximity to your neighbors. Whether that’s a positive or a negative depends on how sociable you are. If you like getting to know your neighbors you’ll love this aspect of condo life.

5. Building equity and more

We touched earlier on buying a condo as a stepping stone. Not only will you build equity to put toward a future purchase, but owning a home has tax advantages as well.

Yes, tax laws are in flux right now, but you will still receive homeownership benefits that you won’t have if you continue renting. 

6. Feel safer

Many condo developments offer security features. Whether it’s a gated community or one with a roving guard or even a community with camera surveillance, security is a feature lacking in many single-family homes.

This is especially important to people who live alone and may feel vulnerable. Even a community lacking robust security features will feel safer simply for the fact that you live in close proximity to others, so seeking help in an emergency is far easier.

7. Convenience

If your aim is to live in the heart of the city or within walking distance to popular area amenities, you’ll find few single-family homes from which to choose. But, this is where the condo market shines the brightest.

Ditching the commute—or even the car—is a distinct possibility with urban condo living.

Do reach out to us if you’re considering purchasing a condo. We’re happy to walk you through the process and show you what’s available now.

 

It’s spring – time to shake the house!

In case you missed it, spring sprung on March 20. That means it’s time for the annual spring-cleaning ritual. And, although the exact origins of the ritual are in question, historians do know that it dates back thousands of years.

Iranians perform the task on the first day of spring and call it “khooneh tekouni,” (تکان دادن خانه) which is aptly translated to “shaking house.”

Today, Americans don’t go to quite those lengths. In fact, spring cleaning can be a relatively quick and easy process if you perform only the basics. To prove it, take a look at our handy checklist below.

8 steps to get your landscaping ready for spring

March 20, 2018—the day those of us who love nothing more than getting dirty in the backyard have longed for.

It’s the first day of spring and, although we’re ready, our gardens may not be.

In fact, before stepping one foot onto your home’s landscaping, “give the soil the ‘squirt’ test,” cautions landscape contractor Roger Cook, at thisoldhouse.com.

“Step down hard on the ground. If water squirts up around your boot, stay out,” he continues. Walking on soggy soil may cause compaction problems. So, if water does squirt out of the soil, wait a couple of days and try the test again.

But there are lots of other things to do to get you and your yard ready for spring.

1. Make a plan

If your planting beds require revitalization, put a plan on paper. What plants will you remove and what do you need to buy to replace them? Draw diagrams of different locations to see which spot fits best.

2. Check your gardening equipment

Sharp pruners and mower blades make clean cuts so if yours are on the dull side, have them professionally sharpened. If you prefer the DIY route, you’ll find a walkthrough of the sharpening process online at familyhandyman.com or see Martha Stewart’s video. Don’t forget to five the lawnmower a tune-up.

3. Prune trees and shrubs

Pruning frost-sensitive shrubs isn’t a good idea right now as there may still be a frost danger. Hardier perennials, however, will take to pruning quite well. First, get rid of damaged and dead branches. Those that are damaged can be cut back to live tissue, but completely prune away dead branches.

4. Cut back perennials

Cut down your flowering perennials to a height of about 6 inches. Ornamental grasses should be pruned to 4 to 5 inches in height.

Wait to prune roses until right after the last frost, just before the plant breaks dormancy. Better Homes and Gardens offers tips on rose pruning.

5. Clean up beds and borders

Once the pruning is finished it’s time for cleanup. A leaf vacuum or blower will rid the yard of whatever winter blew in but you may need a rake for the larger, heavier items.

Use a leaf vacuum or blower to get rid of accumulated leaves and twigs and a rake for larger items, such as branches.

6. How’s the soil?

Although the soil amending process is ideally performed in fall, it can be done in spring. As soon the weather permits, aerate and amend the soil in your beds and borders. No, it’s not a quick task, but it will pay off in the long run.

Pull back the mulch from around your current plantings and use a garden fork to carefully loosen the top 2 to 3 inches of soil (don’t disturb the plant’s roots). Then, lay down about 3 inches of compost and use the fork to mix it into the soil around the plant. Then, replace the mulch, if it’s still in good shape.

Cook recommends replacing the mulch each year, but we know that can get a bit pricey, especially in large yards. If it’s still in good condition, rake the beds to ensure even mulch coverage.

7. Thinking of adding some color for summer?

Consider the following bulbs, which can be planted now:

  • Asiatic lilies
  • Oriental lilies
  • Crocosmia (Crocosmia aurea)
  • Chinese ground orchids (Bletilla striata)
  • Hardy Begonia (Begonia grandis)

8. The lawn

If the lawn has dried out, give it a good raking to get rid of all the debris that flew in over the winter. If you rake deeply, you’ll also solve thatch problems. Then, inspect the lawn for signs of moss, soil compaction and bare spots.

HGTV and Today’s Homeowner offer walk-throughs of early spring lawn care tips.

Bugs that eat our homes — what you need to know

Powdery stuff on the floor near the wall. Tiny mud tubes on the wall. One- to two-inch round holes near the eaves, deck and siding.

While easily overlooked, these are all signs of a wood-destroying pest infestation in and around your home. Overlook the signs at your own peril, as the damage caused by these tiny insects is expensive to repair.

And, it’s seldom covered by homeowner insurance policies

In fact, U.S. homeowners spend more than $5 billion a year to repair termite damage alone, according to Orkin, the pest-control company.

But, termites are just one of the many types of pest who feast on the wood that holds up your home. Get to know them, and the symptoms of an infestation, to stop the damage before it eats your pocketbook.

Termites 

The most common wood-destroying pest, it is present in every state, except Alaska. And, if that news isn’t bad enough, consider this:

There is more than one type of termite

While there are more than 2,000 different species, the three subcategories of termites most commonly found in our homes include subterranean, dampwood and drywood termites.

And, each type has a preferred type of wood

If you suspect termites in your attic, they are most likely of the drywood variety, as they enjoy dining on wood with little moisture content.

Decayed woods are attractive to dampwood termites and subterranean termites aren’t picky, but they seem to prefer softwoods, such as pine, fir and spruce.

How much do termites eat?

The experts at Orkin say that the amount of wood a termite colony can eat depends on which type of termite is dining, the size of the colony and a few other factors. They warn that the Formosan termite is the most voracious.

They live in large colonies and “can cause extensive damage to a home in less than six months,” under ideal conditions. They prefer warm, humid climates (hello Hawaii!).

The damage they do

Termites eat wood. But, don’t assume your home is safe if it was constructed of other materials.

According to pest control experts, termites can go right through metal siding. Plaster poses no problem for them, either.

Once inside, they’ll infest anything made of wood, from your furniture to cabinetry, floors and ceilings. They’ll weaken the home’s structure, the stairs, the outside deck and more.

And, they do this without leaving obvious traces of their existence. If you know what to look for, however, you can act quickly.

Signs of a termite infestation

You’ll need to look closely for signs of a termite infestation. “Termite damage sometimes appears similar to water damage,” say the pros at Orkin.

Don’t assume that the buckling of your wood floor is from moisture intrusion because it just may be termites causing it. Mold- and mildew-like odors may also indicate a termite infestation.

Look for tiny mud tunnels near the home’s foundation – a sure sign of a subterranean termite colony nearby. Other signs to look for include:

  • Tiny wings on window sills and floors, near the wall.
  • Cracked paint.
  • Wood that gives a hollow sound when tapped on.

Termite Prevention

We look at homes every day and we see a lot of “termite attractants,” both inside and out. One of the most common is the woodpile pushed up against the home. Other common termite invitations include:

  • Allowing the sprinkler to hit the side of the home.
  • Cracks in foundation walls.
  • Attaching wood trellises or wooden planters to exterior walls.
  • Insufficient ventilation in crawl spaces.
  • Blocked foundation vents.
  • Shrubbery planted too close to the home’s foundation.
  • Gutters filled with leaves and other organic debris.

The cure

Termite eradication isn’t a DIY project – it requires the services of a pest control professional.

“There are two general categories of termite treatment,” according to the experts in the entomology department at the University of Kentucky.

  • Liquid termaticides – Applied to the soil, they keep the little critters from entering the home. They also kill those termites who have already moved in, since they can’t get back outside without crossing the liquid’s barrier.
  • Bait – “Termite baits consist of paper, cardboard, or other palatable food, combined with a slow-acting substance lethal to termites,” say the pros at the University of Kentucky. The bait material is placed in a plastic tube, underground, or inside, over the mud tubes.

Reach out to us if you plan on selling your home and suspect you may have a termite problem. We’re happy to refer you to a professional for additional advice.