Episode 1 – Advice and Tips on using a VA loan, obtaining seller credits and living in Savannah, Georgia


Introduction 00:00

This is Listen Up Home Buyers. The only podcast offering Home Buying advice and tips from true buyer agents, and now here’s your host Victoria Ray Henderson.

Victoria Ray Henderson 00:11

Hello and welcome to the first episode of Listen Up Home Buyers. I’m excited to introduce my first guest for the podcast. She is an Associate Broker of Exclusive Buyers Realty in Savannah, Georgia, and President of the National Association of Exclusive Buyer Agents. Welcome Andi DeFelice.

Andi DeFelice 00:30

Thank you, Victoria. I’m happy to be here.

Victoria Ray Henderson 00:32

So glad to have you. First, can you tell us what the market like is for buyers in Savannah, Georgia, summer of 2019?

Andi DeFelice 00:41

Well, right now it’s very hot, both literally and figuratively, because we’re in our 110 to 115 degree heat indices. Other than that, we are coming off of what I would say is a relatively strong seller’s market down to,, not so much a Buyers’ market as more of a leveling market, I think sellers are getting fair prices for their houses and buyers are paying fair prices, we have decent inventory in certain parts of our market, limited inventory, of course in those normally very hot neighborhoods in our market. But it’s a good time to be a buyer in Savannah, interest rates are low, they’ve rewritten the flood map so a lot of the properties that were unobtainable because of the flood zones last year, are now attainable for buyers in our market.

Victoria Ray Henderson 01:28

That’s interesting because of where you are, I guess that flood zone map is very, very important, becomes a big part of the whole buying process.

Andi DeFelice 01:36

Absolutely. We had several houses last year that buyers literally could not afford because their monthly flood insurance premium was 2 to 3 to $400 a month, and when FEMA rewrote the maps in August of 2018. A lot of those properties that were in required flood zones, meaning the lender required you carry insurance came out of those required flood zones. So we still highly recommend that our buyers purchase flood insurance. But if you’re not in one of the lender required areas, it’s less than $500 a year for the policy. So it had a huge impact on our market.

Victoria Ray Henderson 02:13

So I know Savannah, it’s very unique. I’m from the Washington DC area. So we have new construction, we have some very old construction as well, particularly older condo buildings in the district. What is the housing like in Savannah?

Andi DeFelice 02:30

Well, it depends on where you want to be. So Savannah surrounded by water on three sides, so all of our new construction, it’s pretty much on our west side of the county, which is the only place there’s still dirt that you can build new construction on. So that area of our market, it’s known as Pooler, Georgia or West Chatham is booming right now we’ve had a significant growth in that area over the past 3 to 5 years, it was destined to become what it is today, back in 2007 2008. When the economy took a turn, it’s stopped, and then when things started to come back, the commercial lenders specifically really got hot and the builder loans were there, and there’s a lot of retail out there.

So that is our biggest market for new construction. Otherwise, it is very difficult to find a new home within the city limits of Savannah, or even within the immediate county areas of Savannah because we just don’t have any dirt left we use it out or where water. So as I said the bulk of our new construction, with the exception of a few available lots in certain parts. The bulk of our new construction is on the west side.

Victoria Ray Henderson 03:39

How old are some of the oldest homes in Savannah?

Andi DeFelice 03:43

Oh, 17 to 1800s. Very, very old, and they are very cool. They also can be a challenge when they [crosstalk 03:52] energy efficiency. I mean, it’s the same I’m sure in your market and a lot of those homes, unfortunately have been left in a state of disrepair, we have several incentives going on right now with the city to try and get those areas built back up. But it’s difficult to be the one person who’s willing to put your toe in the water and see if you can get something going. We have had the benefit of the Savannah College of Art and Design who came here in the early 1980s, and they have done a tremendous amount to restore our downtown historical district to what it was. But there’s still a lot more to go.

Victoria Ray Henderson 04:27

Okay, so, thinking about first time homebuyer in Savannah, Georgia, when you sit down for the first time, what are some of those main points that you make sure your clients understand about this process?

Andi DeFelice 04:41

Well, of course, when I sit down with people who want to live in Savannah, they all want to live in the historical area and they need to understand that; that can be very cost prohibitive. So my challenge with first time homebuyers specifically to move into Savannah is setting realistic expectations. You’re not going to be able to afford that beautiful downtown historic property at $200,000, it’s just not going to happen.

Victoria Ray Henderson 05:05

What are they basically running for when you’re….

Andi DeFelice 05:08

Oh downtown.

Victoria Ray Henderson 05:08


Andi DeFelice 05:09

Depending on condition, they’ll go well into the millions. I mean, depending on the condition, location, it just really— the Savannah is one of these hit or miss should have 3 or 4 blocks of beautiful homes, and then you’d have 2 or 3 blocks, but not so beautiful homes, and then 3 or 4 more beautiful, so it really is kind of hit or miss. There are other areas of town that are also historical, but not specifically downtown that have these darling little cottages and bungalows, craftsman style Tudor style. The neighborhood specifically is called Ardsley Park, and it’s one of the most favorite neighborhoods for the up and coming young families. Those houses can be purchased for between 300-350. But what you have to understand that if you want that character and charm, you’re going to get a single vanity in your master bathroom, if you even get a master bath. You’re going to have very small closets because you think about houses that were built in the 1930s and 40s. Back in the day, not important back then.

Victoria Ray Henderson 06:04

So not only that frequently, they didn’t even build closets. I mean, they had the [crosstalk]

Andi DeFelice 06:09

They had armoires. So those are some of the challenges that I have with– I’m working with a young couple right now that really wants to live in that neighborhood. But they need a large vanity, they need a large master bathroom, they need walk in closet, and those two things don’t always meet, sometimes we get lucky enough to find one that’s been rehabbed, and a builder has come in, in some cases, and done away with a bedroom in order to build this master bathroom, master bed, I mean, master closet, and that works. Well, it’s all in what you’re willing to accept, right? And how badly you want to live in that neighborhood. Those are some of the challenges I have with my first timers more than anything is they all want to live in the cool, eclectic, walkable neighborhoods. But the houses aren’t necessarily meeting their budget or their requirement.

Victoria Ray Henderson 06:57

Yes, it’s about managing those expectations as they’re going in. Do you have any recent transactions that you’ve done that that you could tell me about how working with you was particularly important for your buyer client and why?

Andi DeFelice 07:14

I think all of my recent transactions. I do have one, I worked with a couple. It was a VA loan. They needed 100% financing. They needed all of their closing cost paid with the inclusion of being able to get their earnest money refunded. I mean, they truly did not want to come out of pocket one single penny to buy this home. They were not first time Home Buyers. But it had been quite some time since they bought a home. Both were divorced and remarried and now living in an apartment. We had significant challenges because they wanted to buy everything that came on the market the first day it came on the market, but because we needed so many seller concessions. It was just very difficult to get it negotiate.

Victoria Ray Henderson 08:00

Yes, you couldn’t compete?

Andi DeFelice 08:01

Not with that sort of situation. But we finally did. We found one and we got the seller to agree and they closed on Friday.

Victoria Ray Henderson 08:08

Wonderful. Talk a little bit about those seller concessions for somebody who doesn’t know what that is? Can you walk us through that a little bit?

Andi DeFelice 08:18

Sure. A lot of it depends too on the type of loan that you’re getting when you’re failing VA, the VA will allow the seller to pay all of your closing costs, including your prepaid items and prepaid items or of course those items that establish your escrow account, which is what your bank pays your insurance and your taxes out of on a monthly basis. FHA, I believe has a pretty unrestrictive requirement with regard to what the seller can pay conventional loans, depending on the loan sometimes will only allow the seller to pay 3 to 4% of the actual closing costs.

So when I say seller concessions, that’s what I mean. In Georgia, they’re not necessarily called seller paid closing costs, they’re just sellers’ credit or seller’s contribution at closing. But they are to be used toward the closing cost or toward the inspection, those types of fees cannot be used toward a down payment, and one thing that I have to make sure that my buyers understand is if we ask for $7500, for example, in seller concessions at closing, and the closing cost only come up to $6,000. You don’t get the full 70. So you don’t get the extra $1500. Seller only pays what the closing cost equated to.

So I try and be real clear with my lenders when I’m writing those types of contracts, and I do a lot of VA because we have two military bases in Savannah that I get a real good number to that I can use in that blank on the contract.

So there isn’t any question for either the seller or the buyer as to how much money they’re truly talking about at closing.

Victoria Ray Henderson 09:54

Now I’m sure you have preferred lenders that you work with and because I know we do in DC and they’re the people we go to that when we get in a jam because somebody has gone with, God forbid an internet lender, and everything starts to fall apart. These are the people that we call to help us put it all back together. You have people like that in Savannah that you work with.

Andi DeFelice 10:17

Absolutely, I have three or four very good lenders that not only– and I mean, I can call them Saturday, Sunday, 9 o’clock at night, it doesn’t matter. They also are a great source of business for me as well because of our relationship, appreciate the exclusive buyer agency relationship that we have with our clients, because a lender, your buyer– when you’re working with a lender, you’re that lenders client as well, they have the same responsibility to you that we do as your exclusive buyer agent. So they understand that buyer client relationship, and they will refer buyers to me that walk in without representation. They refer them to me 9 times out of 10, which is fantastic because again, they appreciate the protection that I’m giving their clients.

Victoria Ray Henderson 11:02

Right, because you obviously know dual agency, you’re 100% supportive of the buyer. Talk a little bit about when somebody moves to Savannah, what can they expect with their daily commute? I mean, I know that’s a broad question, but….

Andi DeFelice 11:21

Well, it depends on where they’re going to be. But daily commute in Savannah, if we sit in our car for more than 30 minutes getting home, we feel like we’ve been in a horrible rush hour traffic, that I can really appreciate that. But it’s true. I mean, you think about savannas population, and when I say Savannah, I’m talking about Chatham County, which is the county Savannah system and there are actually 4 different municipalities within Chatham County. But we only have roughly 450 to 500,000 people in our county. Yes, we’re not a very big market.

So city limits proper, maybe 150,000 of those make up the actual city of Savannah proper. So the commute, like I said, we’ve grown up very accustomed to not being in the car for very long, I can literally get from my house. It takes me longer to get from my house to the airport than any other part of town, and that’s about a 30 minute drive.

Victoria Ray Henderson 12:19

That’s crazy. I was driving from my office in Bethesda, Maryland to meet a client in McLean, last Friday. It was noon, and it took me 54 minutes to get there, and then on the way back, it was a little longer because you know, it was 3 o’clock, and that’s when rush hour starts.

Andi DeFelice 12:37

Here in the west side of town. Our largest employer is Gulfstream aerospace, and they’re in the west side in that cooler area I was discussing earlier where all the new construction is. If you happen to be in that area, when their shifts get off– when their main shift gets off at 330. Then you could get stuck for maybe 45 minutes depending but that’s you note to time it that way. So yes, commutes are not as important to my buyers as school districts because Chatham County Public Schools need some improvement.

So school districts can be a challenge. I have a lot of Doctor Clients that need to be within 15 to 20 minutes of the hospital so I’m very careful where I put them. But otherwise commutes are not one of the biggest priorities that I have with my clients. It’s mainly schools, its proximity to downtown it’s proximity to the walkable neighborhoods that we have because we have some wonderful ones and its proximity to the water I mean, if you live in Savannah Georgia, you need to have a boat and you need to be close to water. It’s almost a request.

Victoria Ray Henderson 13:37

It’s so beautiful.

Andi DeFelice 13:38

Yes, it’s a lovely town.

Victoria Ray Henderson 13:41

I was watching Baywatch. I don’t know maybe a couple years ago, and you know, I’m a fan of the Rock. I’ll admit it. But anyway, so there he is running on the beach and then I saw that it was filmed in Tybee Island.

Andi DeFelice 13:56

That’s right. That’s our beach. So Tybee Island is about 15 minutes east of downtown Savannah. Now there you will have an hour in the car. If you’re going out to Tabby on a pretty Saturday morning, you and everybody else you will it’s a two lane causeway. So you will be in your car for a bit but it’s wonderful. Once you get out there. It’s become kind of a film Mecca lately we had Forrest Gump was of course filmed here at midnight in the garden of good and evil was not only written in Savannah, but they also made the movie here. Bagger Vance was made here, there’s a movie called Tin Cup that was made here and we also can claim the fame of SpongeBob Square Pants. There was a John Travolta movie that was just being filmed here about a month ago, and right now they are filming the television series— Very popular TV series they’ve shut down downtown to get that filmed. No, that’s very cool. So, it’s brought a lot to the city.

Victoria Ray Henderson 14:52

That’s very cool. Any other topic you’d like to cover?

Andi DeFelice 14:57

I was trying to think I just got back from Norway. The National Association Of Real Estate Editors, and they were talking a lot about– whether this is one question that came up that I thought was so funny whether you should require a home inspection when you’re buying new construction? And the resounding answer that I’ve gotten when I’ve asked our members, that question is absolutely yes, just because you’re buying new construction doesn’t mean that mistakes haven’t been made, not intentionally, builders aren’t trying to short and cut corners, they just may miss something. So having inspections done on new construction during the process, and after the process is completed is very important. That was one of the topics that came up when we were there that I thought was very interesting. 

Victoria Ray Henderson 15:39

You know, we’ve had a lot of new construction clients over the years, we do a pre-drywall inspection that we require, or that we recommend, and then our clients. Every time that we have had a pre-drywall inspection, we have found mistakes, and again, what that means is it’s before they put the drywall in place to see what’s behind that wall where all the outlets are on wirings. Inevitably, somebody second-tier person who came through to do whatever their job was whether it was wiring or H-vac, they’ve done something that needs to be double checked. So yes, I agree. 100%, you’ve gotten to check that out. For you by make the biggest purchase of your life.

Andi DeFelice 16:21

Yes, I felt that too, and I appreciated the fact that the journalists were asking those questions, because it makes me know that they’re thinking about the buyers’ protection as well.

Victoria Ray Henderson 16:30


Andi DeFelice 16:31

-Which I always appreciate so that was just one takeaway I had from the conference that I thought was interesting, and I will share with my buyers, of course, we do the same thing we counsel them, you hate it. You don’t hate it. It’s actually the job of the inspector. But I’ve had buyers after we’ve had a home inspection done the new construction, and they didn’t find anything like, well, they went $350 down the toilet. It was an education, I mean, any inspection and that’s what I counsel my buyers on when we’re talking about the home inspection, be it new construction be in existing construction, the role of the home inspector is to identify material defects, there’s a definition of material defects, it’s not every little Nick in the wall or an outlet that might not work correctly. You’ve got to be real clear on what your inspectors role is so that you don’t go in there. Thank you HGTV [phonetic 17:20] thinking that you’re going to walk away with a $50,000 credit because all these things that are wrong with the house.

That’s something that because I’ve had buyers literally say to me, “Well, after the inspection, we can come back and renegotiate the price”, and I said, “Not necessarily”, the inspection, the purpose of the inspection is to identify these defects and then give the seller the right to correct them. We can’t go in and demand that the seller give us a monetary credit right off the bat. We can certainly say we would accept that in lieu of repairs. But then you’ve got to make sure you’re getting the right kind of credit.

Victoria Ray Henderson 17:57

And that’s where that home inspectors expertise comes in handy. I always I take a lot of notes, I do a lot of videos with these home inspections, because people want to know what these experts have to offer what you can learn.

Andi DeFelice 18:10

Absolutely, and it can truly — and I love our inspectors, again, we’re in such a small, sweet market. Our inspectors not only do their job identifying things, but they also educate my buyers. So tell them how to care for their H-vac system. They’ll tell them what to look for, in the event something springing a leak. I mean, they really spend time with them, especially the first timers, making sure they understand because it’s a shocker [phonetic 18:36] to go from being a tenant where you just called somebody else and something broke to being the owner whether you have no one to call. So I appreciate the education and the time that our home inspectors spend with my buyers, giving them those extra little nuggets of information that make them a better homeowner.

Victoria Ray Henderson 18:54

Yes, I agree. Even just the little things like make sure you caulk around your bathtub every year because people will get a flood of water coming down and not understand that little tube of caulk around that tub. That solves the problem.

Andi DeFelice 19:08

Yes, that might be the one I love that my guy always does is don’t go by the super-duper expensive h-vac filters, get the cheap cardboard ones, change them once a month, and they do just as good of a job and they make your system just as efficient. In the long run, it saves you money because you’re not buying the $15 filter, you’re buying the 99 cent filter, you just have to make yourself change it every month.

Victoria Ray Henderson 19:31

Put it on the calendar and get it done.

Andi DeFelice 19:32

Exactly and get it done. So little things like that can mean such a difference too, especially a new homebuyer because they don’t know what they don’t know, and you need to give them the guidance that they need so they’re buying what they want, and they’re happy with their purchase at the end of the day.

Victoria Ray Henderson 19:48

That’s right. Andy DeFelice, Associate Broker of Exclusive Buyer’s Realty in Savannah, Georgia and president of the National Association of Exclusive Buyer Agents. It has really been a pleasure talking to you and hearing your advice and your tips for homebuyers. Thank you so much.

Andi DeFelice 20:05

Thank you Victoria, enjoy the rest of your day.

Speaker 20:07

You’ve been listening to Listen Up Home Buyers. The only podcast offering Home Buying advice and tips from true buyer agents.

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