Home Improvements That May Improve Resale Value

Home Improvements That May Improve Resale ValueDid you know that some home improvements lower the resale value of a home and decrease the number of potential buyers? If you are going to repaint the exterior of your home bright, traffic-cone orange and try to sell it for a high price, think again! Maybe, if the artist Pablo Picasso once lived there that might work, but probably not under any other circumstances.

Some things are counter-intuitive. A swimming pool is an example. Swimming pools are great and highly desirable for many people. However, others do not necessarily think so and only see them as adding unnecessary expenses for maintenance and upkeep.

There are general guidelines to follow, which give you a better chance to increase the resale value of a home by making certain improvements. If possible, work with your REALTOR® who understands the local real estate market conditions before making decisions about investing in renovations to increase a home’s resale value.

Be aware that the industry averages show a percentage of recoupment of the investment and no renovations make back what they cost, in terms of increased resale value. This means you should only consider renovations that you like for other reasons as well as the potential financial impact on the home’s value. The only way to profit from renovations is to do some work yourself.

Renovations — Partial Recoupment In Resale Value

Here are the top ten things to consider with their average installation cost, average increased resale amount, and the average recoupment percentage as ranked by Remodeling in the 2020 Cost vs. Value Report:

1. Manufactured Stone Veneer (applied to the front of the home)

Installation Cost $9,357 — Increased Resale Amount $8,943 — Recoupment 96%

2. Garage Door Replacement

Installation Cost $3,695 — Increased Resale Amount $3,491 — Recoupment 94%

3. Fiber Cement Siding (applied to the exterior of the home)

Installation Cost $17,008 — Increased Resale Amount $13,195 — Recoupment 78%

4. Vinyl Siding (applied to the exterior of the home)

Installation Cost $14,359 — Increased Resale Amount $10,731 — Recoupment 75%

5. Vinyl Windows (double-pane)

Installation Cost $17,461 — Increased Resale Amount $12,761 — Recoupment 72%

6. Wooden Deck

Installation Cost $14,360 — Increased Resale Amount $10,355 — Recoupment 72%

7. Wood Windows (double-pane)

Installation Cost $21,495 — Increased Resale Amount $14,804 — Recoupment 69%

8. Steel Entry Door

Installation Cost $1,881 — Increased Resale Amount $1,294 — Recoupment 69%

9. Composite Deck

Installation Cost $19,856 — Increased Resale Amount $13,257 — Recoupment 67%

10. Asphalt-Shingled Roof

Installation Cost $24,700 — Increased Resale Amount $16,287 — Recoupment 66%

The runner-ups, with their recoupment percentages, are remodeling the bathroom (62%), metal roofing (61%), a kitchen remodel (59%), a bedroom addition (59%), and a bathroom addition (55%).

Summary

Notice that the top ten items that make the most positive impact on the resale price are all exterior projects and most of them are visible from the front of the home. The wise adage of “curb appeal sells” seems to be true when it comes to renovations that generally improve resale value.

If you are in the market for a new home or interested in refinancing your current property, be sure to consult with your trusted home mortgage professional.

The Most Commonly Searched Household How-To Remedies

The Most Commonly Searched Household How-To RemediesOwning a home comes with a lot of responsibility. Many of the responsibilities that people think about involve home maintenance. There are few things that frustrate a homeowner more than having repair and maintenance bills come up. At the same time, it is important to address these properly.

For this reason, it is important for everyone to understand the most common how-tos people search for. This will give someone a glimpse into some of the responsibilities he or she might face when owning a home. Those who can handle these how-tos can save money on maintenance costs and repair bills.

How To Unclog A Drain

One of the most commonly searched how-tos is how to unclog a drain. Some of the drains that might get clogged include kitchen drains, sink drains, and bathtub drains. When these drains are clogged, water can back up and make the equipment unusable.

In order to unclog a drain, it is important to consider the various options available. Some people use a “snake” to unclog a drain. Other people use a liquid, such as Drano.

How To Stop A Leaky Faucet

Another how-to that people frequently have to handle is a leaky faucet. A dripping faucet can lead to significant increases in someone’s water bills. Furthermore, the dripping noise can also keep people up at night.

Sometimes, the handles on the faucet simply need to be tightened to stop the leaky faucet. In other cases, there might be a loose washer underneath the sink somewhere. These are some of the common causes of a leaky faucet.

How To Patch And Repair Drywall

Another common house issue that people sometimes need to handle involves drywall. Patching drywall can be a complicated process depending on the location and size of the drywall.

Everyone who is thinking about patching drywall should understand the steps involved. This includes how to make the drywall smooth in addition to the various adhesives and tools involved.

Understanding Household How-Tos

These are a few of the various how-tos that people might have to face during homeownership. Homeowners that can handle these how-tos will be able to save money on maintenance and repair bills down the road, provided they are handled properly.

If you are in the market for a new home or if you are interested in refinancing your current property, be sure to contact your trusted home mortgage professional.

5 Excellent Pathways To Home Ownership For Millennials

5 Excellent Pathways To Home Ownership For MillennialsMillennials are a huge socio-demographic group of over 83 million people. Many of them want to buy a home but face challenges that their parents did not necessarily have. Homes are more expensive. In most places, home prices rebounded to exceed the pre-2008 economic collapse values. Moreover, home prices continue to go up.

The encouraging news is that there is home financing readily available and mortgage interest rates are still reasonable. Even if it is more challenging, the greatest investment that most Americans can make is buying a home. Paying rent is only helping the landlord get rich. Homeownership is still highly desirable and a part of a wise long-term investment strategy.

Here are some tips that millennials can use to become homeowners.

Save For The Down Payment And Build An Excellent Credit History

The best rates for home loans are for those with an excellent credit history who can put down 20%. It is possible to borrow the down payment. The problem with this strategy is that the cost of the loan is higher. The mortgage rate may be higher and the lender may require private mortgage insurance (PMI). PMI pays off the loan balance to the lender if the homeowner defaults on the loan; however, it does not protect the homeowner’s equity in the home or any down payment. PMI just adds another monthly expense.

Create Non-Location Dependent Income

Home prices are somewhat dependent on the local economy and the employment available in the local area. By creating non-location dependent income through the “gig” economy. Work as a freelancer or a person who telecommutes by working from home. With this income, you will be freer to look for a home in a rural area or an area where the home prices are lower.

Take Advantage Of First-Time Homebuyer Programs

Many first-time homebuyer programs are offered by programs of the federal government through the Housing and Urban Development (HUD) and other agencies. Be sure to investigate those possibilities when considering buying a home.

Hunt For A Home In Low-Cost Areas

Use the online systems when searching for a home to compare two things, 1) the median price of homes for each area and 2) the cost of living for each area. The areas with low median prices and that have a lower cost of living are usually easier places to buy a home.

Partner With Others

A home-buying partnership is something many are using to make owning a home more affordable. Multigenerational ownership is used by many families to buy a large home together and share it. Other partnerships can be made among individuals, who are not relatives, to share ownership. Choose ownership partners very carefully and be sure to have competent legal counsel when creating a written ownership agreement.

Summary

Millennials are challenged with new obstacles when seeking to buy a home. The strongest challenge is the cost of homeownership. However, there are many clever ways to improve the chances of enjoying an affordable ownership situation. Be patient and do not give up. Work with a REALTOR® who understands the challenges and is an expert in the area where you are thinking about buying and with a trusted home mortgage professional to find the best financing options for your situation.

Why Buying A Home In An Adjacent Area To The Best Neighborhood Is A Wise Strategy

Why Buying A Home In An Adjacent Area To The Best Neighborhood Is A Wise StrategyHave you ever seen a scientific experiment with things growing in a Petri dish? This is a metaphor for how neighborhoods grow as well. Things in a Petri dish grow towards the areas that have more nutrition to attract them and repel from areas that have bad things that they do not want.

A popular neighborhood does a similar thing. It may have boundaries that are certain street or other physical barriers. Nevertheless, if the area builds its popularity, it tends to grow and might also cause an improvement in the surrounding areas.

Homes In Adjacent Neighborhoods

An adjacent neighborhood is one that is right next to another one. For example, in the Los Angeles Metro Area, just to the west of Beverly Hills is Century City. Century City is a fine area so it is usually called by its name. However, properties in Century City are also “Beverly Hills – Adjacent.”

This nomenclature is a bit like identifying a “used car” as a “pre-owned vehicle.” It is a marketing technique to say a home is located in a neighborhood adjacent to a popular one. However, those homes are indeed special. If the popular area appreciates significantly, this may have a positive impact on the neighborhoods surrounding it.

Mapping Adjacent Neighborhoods

It is a terrific strategy to look at the opportunities for buying a home in an adjacent area near the best neighborhood in town.

Use Google maps to find the map that includes the best area of town and what is around it. Then, research the listing prices for homes that are within the best neighborhood and those that are in the adjacent areas. For comparison, look for homes of the same style, type, and size

Zoom in on the satellite view of the streets to get a close look at the places just inside and just outside the official boundaries of a great neighborhood. It may be surprising to find areas that have a significant pricing differential, even just for a few blocks on a few streets. Those particular areas are worth further exploration.

Barriers To Progress

Be aware that physical barriers are stronger than psychological ones. A river, a very wide street, a public park or another major physical barrier can permanently separate a neighborhood from another adjacent one. These may block a growth opportunity.

What to look for are adjacent areas where the barrier between the neighborhoods is psychological and there is nothing at all very different between the great neighborhood and two blocks down the street. These few blocks in the adjacent neighborhood are where one might discover a treasure. It is possible to find a home that has a slightly better price. It might appreciate at the same rate as the best neighborhood next door or faster to catch up with other similar homes.

Summary

Using the adjacent neighborhood strategy may help avoid buying a home only in the most expensive areas that may be over-priced. Many find that the adjacent areas are just as nice and a home there may be a better value.

Work with a real estate agent that knows the area well. Your agent should be able to help you discover the up-and-coming adjacent areas and properties that might offer an enhanced investment opportunity. As always, your trusted home mortgage professional is the best resource for current financing options.

How Much Money To Budget For Home Maintenance

How Much Money To Budget For Home Maintenance1Owning a home comes with a lot of responsibilities. One of these involves home maintenance. Sometimes, people are surprised by the size and frequency of home maintenance costs.

In order to reduce the stress that comes with home maintenance, it is important to plan ahead of time. This means budgeting for the inevitable costs that come with home maintenance. There are a few systems that people can use to estimate their home maintenance costs.

The Percentage System

One of the most common systems that people use is the percentage system. In general, the amount of money that people spend on maintenance is directly related to the size of their home. The larger the home, the more money someone is going to spend on maintenance.

Most people will spend between 1 percent and 4 percent of their home’s value every year in maintenance costs. Older homes are going to have more maintenance costs than younger homes. For example, if a home is worth $300,000, someone is going to be spending between $3,000 and $12,000 per year on upkeep.

The Square Footage System

The range above might be too large for someone to budget accurately. Therefore, a lot of people also use the square footage system. Again, the larger the home, the more someone will spend on upkeep.

In general, someone should allocate $1 dollar per year per square foot of home. For example, if someone’s home is 2,500 square feet, they should allocate about $2,500 per year in home maintenance.

Some of the downsides of this method are that it does not take into account the location or age of the home. Keep these factors in mind as well.

Home Maintenance Is Different Than Home Repairs

Home maintenance costs are very different than major repairs. The idea of maintenance is to prevent repairs from arising. If someone has to replace their HVAC unit or take out faulty wiring, this does not count as home maintenance costs.

With this in mind, it is important for everyone to budget accurately for home maintenance and to make sure these tasks are completed on-time. Proper home maintenance can save money on homeownership by preventing major repair bills from coming up down the road.

And any time you have home maintenance questions, remember to ask your real estate professional. They have a lot of experience dealing with every type of home repair and a list of local referral maintenance providers.

If you are in the market for a new home or interested in refinancing your current property, be sure to contact your trusted home mortgage professional to discuss financing options.

The 5 Most Common Dangerous Home Issues

The 5 Most Common Dangerous Home IssuesYou are supposed to feel safe in your own home; however, accidents can happen and there are plenty of hidden dangers that might land someone in the hospital. It is important for you to understand the common household dangers. Knowledge is power and you can take steps to prevent these issues from arising.

Carbon Monoxide Poisoning

This is one of the most common household dangers that everyone should know. Homes always have a smoke detector; however, carbon monoxide detectors are often overlooked. This is an odorless gas that can actually kill someone if the levels get too high. Make sure that your carbon monoxide detectors are working. This gas commonly arises from the tailpipe of a running car.

Lead Poisoning

Lead can be absorbed through the skin or the mouth. Lead poisoning can lead to serious neurological issues. Newer homes are built without lead paint; however, if you purchase an older home, there might still be lead paint on the walls. Check the paint thoroughly and swap it out if lead is present.

Mold

Mold is a common hazard that grows in homes. Mold can release spores into the air that can irritate people who suffer from asthma and allergies. Make sure that you keep your home clean to avoid mold growth. Mold likes warm, humid climates.

Falls

Injuries due to falls are among the most common accidents that happen in homes. If someone falls in their home, they are at risk of breaking bones or suffering a head injury. Make sure that you keep your outdoor steps clean and stabilize your staircases. This will reduce the risk of falls.

Drowning

Unfortunately, drowning can happen even if someone is safe in their own home. Even if a house doesn’t have a pool, people can still drown in the bathtub. In order to reduce the risk of a drowning event, make sure your pool has a fence around it (if you have one). Also, try to supervise bathing children. This will reduce the risk of a drowning event.

Reducing Household Dangers

Knowing about these dangers ahead of time reduces the chances of them happening. Try to inspect your home thoroughly to make sure that these common hazards are avoided.

If you are in the market for a new home or interested in refinancing your current property, be sure to contact your trusted home mortgage professional to discuss current financing options.

How To Find Hot Markets For Real Estate Investment

How To Find Hot Markets For Real Estate InvestmentReal estate investors who want to build up a strong investment portfolio always keep an eye out for hot markets, which gives them a chance to pick up properties that add to their portfolio value.

A word of caution about hot markets is that if you learn about them after they are already hot, you may have missed much of the run-up that made them hot.

Clever real estate investors try to anticipate markets that will heat up before they do, so they can buy properties in advance of increasing values. Selling properties in a hot market is how they capture profits.

The Hot Markets

Realtor.com® identified seven markets in the United States that are currently hot markets for flipping houses. The average gross profit for house flippers is $62,700. This figure does not include the cost of making the repairs. The gross profit equals about 20% to 33% of the home’s sales price after making the repairs.

An evaluation looking for hot markets for flipping homes considered the percentage of home sales that were investment properties.

The current hot markets, in the order of activity, are:

  1. St. Louis, MO – 18.8% of home sales are investment properties. The median sales price is $189,900.
  2. Birmingham, AL – 17.3% of home sales are investment properties. The median sales price is $190,000.
  3. Miami, FL – 17% of home sales are investment properties. The median sales price is $299,900.
  4. Tampa, FL – 16.2% of home sales are investment properties. The median sales price is $230,000.
  5. Memphis, TN – 16.1% of home sales are investment properties. The median sales price is $206,300.
  6. Las Vegas, NV – 15.7% of home sales are investment properties. The median sales price is $301,800.
  7. Phoenix, AZ – 15.1% of home sales are investment properties. The median sales price is $275,800.

Hot Pockets In Cooler Markets

Another way to find opportunities is to know your local market very well and look for areas that are up and coming. Look for a fixer-upper in a decent area. Also, search in areas that are adjacent to high-priced areas.

Look for soft barriers that can be passed easily, such as a block that is improving, which is next to another block that has already improved. Hard barriers, such as a wide street, a freeway, or a river make it more challenging for an improving neighborhood trend to pass across them.

Summary

Finding a hot market or a hot pocket comes from investigating potential growth areas and watching them. Get a feel for the trends. One strategy is to buy early when the prices are still low, rent the property for a while, and then sell later, once the market heats up.

If you are in the market for a new home or interested in refinancing your current property, be sure to consult with your trusted home mortgage professional.

When’s The Best Time To Buy A House?

When's The Best Time To Buy A HouseIf you happen to want to move to a hot market for home sellers, here is some advice. Go looking for a home to buy when it is freezing outside or the weather is otherwise severe. Buying a home is both about finding one you like and beating out others if the market has buying competition.

Days On Market

To find out the competition for a particular market, check the median number of days that a home is listed on the market before it sells. This is called the “days on market.”

In a hot seller’s market, the median number of listing days may be very low. The national average days on market (DOM) is 62 days in America.

The top ten cities where homes sell the fastest with the lowest DOM as reported by Realtor.com® are:

  1. San Francisco, CA – DOM 28
  2. Spokane, WA – DOM 31
  3. Boston, MA – DOM 32
  4. Colorado Springs, CO – DOM 32
  5. Lafayette, IN – DOM 34
  6. Columbus, OH – DOM 34
  7. Sacramento, CA – DOM 34
  8. Santa Cruz, CA – DOM 34
  9. Midland, TX – DOM 36
  10. Odessa, TX – DOM 36

Time Of Year

Most homebuyers look for a home during spring and summer. That is when the buying competition is normally stronger. June is the worst month to buy a home if you want to get a discount.

If you can wait until fall or winter, you may see more price reductions. The best time to make a low offer may be during the short window of time between Christmas and New Year’s when virtually no one is looking to buy a home.

Use bad weather for an advantage. Go looking for a home in the dead of winter, when the roads are barely passable, and you may be the only buyer interested. Another advantage that comes from viewing a home during severe weather is that you get to see how much trouble the weather will be if you own it.

Tax Time

One very successful real estate investor buys homes right before tax time because that is when sellers are worried about paying taxes and might be more flexible on the price.

Estate Sales

It is possible to get a nice deal on a house when a family is liquidating assets.

Divorce

A seller may be motivated by having to sell a house as part of a divorce settlement.

Summary

The main factors, if you want to get a discounted price for buying a home, are not to be in a rush to buy one and take your time finding a home that is for sale by a motivated seller. Always ask, “Why are you selling your home?” when negotiating with a seller.

If you are interested in buying a new home or in refinancing your current property, be sure to contact your trusted home mortgage professional to discuss current financing options.

Ways to Stay Safe During the Holidays

Ways to Stay Safe During the HolidaysThe arrival of fall, with cooler temperatures followed by a season of holiday celebrations, means getting cozy at home, spending more time cooking and enjoying friends and family in front of a blazing fire, and lighting up your home for a series of holidays. Sadly, though, it is also a time that carries a higher risk of property losses due to fire and accidental injuries.

Here are some guidelines about how to reduce those risks and stay safe this winter:

Keep The Kitchen Safe

Serious burns and kitchen fires can dampen any holiday celebration. Statistics show that Thanksgiving and Christmas holidays can be especially prone to accidental kitchen fires and injury. If you have guests helping out, or children in the kitchen, be especially watchful. Don’t overload circuits and never let electrical cords dangle over counters. Supervise young helpers, and know what to do in case of a stove-top grease fire or a sparking appliance.

Check The Fireplace

There’s nothing as cozy as a roaring fire on a chilly winter evening. But follow the rules for fireplace safety: Have a proper screen, don’t throw paper into the fire, and check the damper and chimney spark arrestor. Whether you have a traditional fireplace or a gas-fueled metal firebox, perform a pre-season check to assure that everything is operating properly before lighting that first fire.

Candle Safety

Candles are a huge risk during the holiday season, from Halloween on through New Years. As pretty as they are, wax candles should never be left to burn unattended, indoors or out. If you want to line your sidewalk with jack-o-lanterns or create a glowing pathway for winter guests, consider battery-operated candles for safety. Indoors, keep candles away from draperies, drafts and flammable decorations, and don’t ever place candles on a Christmas tree or among pine boughs on a mantel or dining room table. It’s simply too dangerous.

Trees And Home Decorations

If lighting up the home for the holidays is a tradition for your family, check the UL label for both indoor and outdoor lighting and never overload a circuit. Use care when stringing lights, and turn them off when you’re not at home. Check ornament labels — look for flame retardant and non-flammable certification. Always turn lights off at night or when you’re not at home.

General Safety Precautions

Autumn is also the prime time to test your home’s smoke alarms. It’s smart to stage a family fire drill. Go over your escape plan in case of fire, and be sure to inform guests about what to do in case of emergency. In addition, if you don’t already have a carbon monoxide detector, why not consider installing one this fall?

Staying safe is a family responsibility, one that you should take seriously!

If you are looking for a new home or interested in refinancing your current property this winter, be sure to contact your trusted home mortgage professional to discuss current financing options.

Real Estate Tips for a First-Time Home Seller

Real Estate Tips for a First-Time Home SellerMany homeowners don’t think about what it takes to successfully sell a home until they make the decision to purchase a new home. It makes sense to consider the best ways to improve your home sales appeal early if you think you might consider selling at any time in the future.

Some reasons for buying a new house are to accommodate a growing family or a transfer to a new job. No matter the reason you want to buy a new home, it is important that you take the right steps to ensure you sell your home on terms that meet your needs.

Not only do you want to get a good price for your home, but you also want to sell your home sooner rather than later. Read this article for real estate tips that will help you as a first-time home seller.

Price Your Home Accurately

It is essential that you price your home accurately. To do this, you should use a reputable, trusted real estate listing agent. The home selling process will be far more straightforward for you if you choose a real estate agent who is actively engaged in real estate on a daily basis and knows your neighborhood well.

Your agent will take a look at the comparable sales of homes in the area and create an estimate of value, which is called a comparative market analysis. You can compare this estimate to the estimates from different real estate websites as well.

However, your listing agent will likely provide you with the most accurate estimate of value because they will use their education and experience to take into consideration the nuances of your local market and your particular home that will impact the sales price.

Home Staging

If you want to boost the value and buyer appeal of your home, you should do some home staging. In general, homes are most appealing to buyers with half of the furniture removed. Believe it or not, you want potential buyers to walk into your and wonder if anyone is actually living in the home.

The purpose of home staging is to boost the appeal and selling power. One of the best and most cost effective upgrades you can do during the home staging process is painting the walls. A fresh coat of paint will make any home look better.

List Your Home

The season that you choose to list your home is an important decision. The sales success can depend on the weather, time of year, local community, school schedules, and the state of the real estate market. Your real estate listing agent should have a solid plan to broadcast their new listing in the best light possible on its first day being listed and follow that with an energetic promotional agenda.

Talk with them to learn more about their customary marketing plan before agreeing to list your home for sale. This gives your agent a chance to demonstrate their marketing expertise and you will know that you have the best representation for your home when it goes on the market.

If you are interested in purchasing a new home or refinancing your current property, be sure to contact your trusted home mortgage professional to discuss current financing options.