Should You Get a Radon Test for Your Idaho Falls Home?

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Today I have Gary from Radon Be Gone to help us talk about radon inspections. A lot of people don't know too much about radon, so I thought I'd take the time to educate you on it.

Radon is a radioactive gas formed by a naturally occurring breakdown of radium, and it is hazardous to your health. It comes from decomposing radium, and it's everywhere, but we have to test to make sure that the levels aren't high enough to harm people.

In Idaho Falls it's estimated that 20% of homes have radon that is above the acceptable exposure level. Radon exposure can cause lung cancer, and it kills roughly 20,000 people every year in America.

When we have inspections done on properties for radon, we usually check in the basement. An instrument is placed to trace the levels of radon, and it takes 48 hours to complete the test. Readings can vary throughout the year, especially if there is high wind.

In my experience, the areas north and south of the Sunny Side Corridor, as well as the foothills, are where radon readings tend to increase. Another area where we've seen higher numbers is along the Jefferson County Line Road near Madison County.

Our next video will document the process of radon remediation. We'll be following Gary through a home that he is remodeling in order to let you know how he removes radon from a home.

As always, if you have any questions about real estate in Idaho Falls, please don't hesitate to contact me!

What Is Earnest Money?

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The topic of earnest money is one that’s shrouded in confusion. Today we are going to talk about the facts of earnest money, and what you need to know about it.

What is earnest money? It’s a buyer showing the seller they are earnest and sincere about buying the property. What it really functions as is a security blanket. When you place an offer on a home, you are asking the buyer to take it off the market. They want to know that a buyer is invested before they do this, and that’s where earnest money comes in.

I recommend depositing about 1% of the sale price in earnest money. That seems to be the magic number for us. It’s enough to hold the owner’s attention and may save you in the event of a default.

When you pay it, the earnest money is deposited into a trust account for the benefit of both parties. It will not leave that trust account without the agreement of both parties, which leads us to one of the most common myths I hear about earnest money.

I’ve had many people come to me and tell me they believe their earnest money will be forfeited if they end up defaulting. That’s simply not true. If a buyer defaults, that just starts a second negotiation, a negotiation to get out of the contract. Sometimes, the earnest money is enough for the buyers to avoid legal action, which the seller would have the right to pursue if you defaulted.

Assuming no difficulties, the earnest money is applied to the down payment and closing costs at closing. It’s not a donation, it actually counts as part of the cash for your down payment.

If you have any questions for us about earnest money, feel free to give us a call or send us an email.

Where Are Interest Rates Heading?

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Last week, I attended the annual Megacamp for Keller Williams. Gary Keller discussed his and the experts' forecast for our real estate market, and they all agree that a shift is approaching our market due to changes in interest rates.

The Fed wants to see interest rates between 5% and 6% because the rates we have now are not healthy for the economy. What does this mean for you?

Let me give you an example. The other day, I had some folks lock in a 30-year conventional loan at 3.625% percent. If they borrow $200,000, they would have a principle and interest payment of $915. If rates go up one by one percent, they can only borrow $178,000 in order to have a payment of $917. If rates go up to that target range of 5.625%, to keep the same payment of $917, you would only be able to borrow $159,000 to buy their home.

That is a 22% loss of buying power due to a two percent change in interest rates. There will still be people moving, and first-time buyers will still come onto the market. However, all the people who bought homes with these low rates may want to upgrade someday. When they recognize their loss of buying power, these people won't move. They'll stay where they are.

The consequence is that fewer homes will come on the market, and there will be fewer buyers. At this point in time, the experts don't believe that interest rates will affect home value. So if you're interested in buying, lock in these low interest rates now.

If you have any questions, give me a call or send me an email. I look forward to hearing from you!