THE SMART WAY TO LOOK AT HOME IMPROVEMENTS

          

     

          What home improvements really pay off when the time comes to sell your house? That’s an important question for any homeowner contemplating moving or remodeling. And the only possible answer is a somewhat complicated one.

          That answer starts with the fact that really major improvements – room additions, total replacements of kitchens and baths, etc., -- rarely pay off fully in the near term. It ends with the fact that small and relatively inexpensive changes can pay off in a big way in making your home attractive to buyers if your decision is to move now. Click here for a great article from Kathy McCleary at HGTV regarding costs and payoffs.

          It’s a simple fact, consistently confirmed across America over a very long period of time, that even the most appropriate major improvements are unlikely to return their full cost if a house is sold within two or three years.

          Does that mean that major home improvements are always a bad

idea? Absolutely not. It does mean, though, that if your present house falls seriously short of meeting your family’s needs you need to think twice – and think carefully – before deciding to undertake a major renovation. Viewed strictly in investment terms, major improvements rarely make as much sense as selling your present home and buying one that’s carefully selected to provide you with what you want.

          Even if you have a special and strong attachment to the house you’re in and feel certain that you could be happy in it for a long time if
only it had more bedrooms and baths, for example, there are a few basic rules that you ought to keep in mind.

          Probably the most basic rule of all, in this regard, is the one that says you should never –unless you absolutely don’t care at all about eventual resale value – improve a house to the point where its desired sales price would be more than 20 percent higher than the most expensive of the other houses in the immediate neighborhood.

          Try to raise the value of your house too high, that is, and surrounding properties will pull it down.

          Here are some other rules worth remembering:

          Never rearrange the interior of your house in a way that reduces the total number of bedrooms to less than three.

          Never add a third bathroom to a two-bath house unless you don’t care about ever recouping your investment.

         Swimming pools rarely return what you spend to install them. Ditto for sun rooms – and finished basements.

          If you decide to do what’s usually the smart thing and move rather than improve, it’s often the smaller, relatively inexpensive improvements that turn out to be most worth doing.

          The cost of replacing a discolored toilet bow, making sure all the

windows work or getting rid of dead trees and shrubs in trivial compared with adding a bathroom, but such things can have a big and very positive impact on prospective buyers. A good broker can help you decide which expenditures make sense and which don’t, and can save you a lot of money in the process.

REAL ESTATE TERMINOLOGY - THE BASICS

Anita Tate, Broker

          When buying your first home, one of the stumbling blocks you may experience is understanding some of the real estate terminology. If real estate terms are not be part of your day to day vocabulary, then they may seem strange or even confusing. So learning a few key terms in advance may reduce some of your stress of your home buying process. In the following transaction scenario, a brief definition is given for real estate terms you will encounter. If you want to learn more, just click on the link for a more detailed explanation.

          For example, many buyers confuse the terms broker and agent or salesperson. A broker is a properly licensed individual, or corporation, who serves as a special agent in the purchase and sale of real estate, a salesperson is an individual employed or associated by written agreement by the broker as an independent contractor. The salesperson facilitates the purchase or sale of real estate.

          Once you decide to purchase, a salesperson will prepare a sales contract

to present to the seller along with your earnest money deposit. The sales contract is the document through which the seller agrees to give possession and title of property to the buyer upon full payment of the purchase price and performance of agreed-upon conditions. The earnest money is a buyer’s partial payment, as a show of good faith, to make the contract binding. Often, the earnest money is held in an escrow account. Escrow is the process by which money is held by a disinterested party until the terms of the escrow instructions are fulfilled.

          After the buyer and seller have signed the contract, the buyer must obtain a mortgage note by presenting the contract to a mortgage lender. The note is the buyer’s promise to pay the purchase price of the real estate in addition to a stated interest rate over a specified period of time. A mortgage lender places a lien on the property. Depending on the state, the document may be called a deed of trust or a mortgage, this secures the mortgage note.

          The buyer pays interest money to the lender exchange for the use of money borrowed. Interest is usually referred to as APR or annual percentage rate. Interest is paid on the principle, the capital sum the buyer owes. Interest payments may be disguised in the form of points. Points are an up-front cost which may be paid by either the buyer or seller or both in conventional loans.

          In general, there are two types of conventional loans that a buyer can obtain. A fixed rate loan has the same rate of interest for the life of the loan, usually 14 to 30 years. An adjustable rate loan or adjustable rate mortgage (ARM) provides a discounted initial rate, which changes after a set period of time. The rate can’t exceed the interest rate cap or ceiling allowed on such loans for any one adjustment period. Some ARMs have a lifetime cap on interest. The buyer makes the loan and interest payments to the lender through amortization, the systematic payment and retirement of debt over a set period of time.

          Once the contract has been signed and a mortgage note obtained, the buyer and seller must legally close the real estate transaction. The closing is a meeting where the buyer, seller and their attorneys review, sign and exchange the final documents. At the closing, the buyer receives the appraisal report, an estimate of the property’s value with the appraiser’s signature, certification and sporting documents. The buyer also receives the title and the deed. The title shows evidence of the buyer’s ownership of the property while the deed legally transfers the title from the seller to the buyer. The final document the buyer receives at closing is a title insurance policy, insurance against the loss of the title if it’s found to be imperfect.

          The typical real estate transaction may take anywhere from four to twelve

weeks. Though the process may be a bit difficult at times, listen to and rely on your agent to guide you through.  And anytime you don't understand a real estate term, ask you agent or click here for a real estate glossary.  A basic understanding of real estate terminology and the chronology of the transaction will help you to buy your first home with confidence.

ARE YOU THINKING ABOUT YOUR "DREAM HOME"?

Are you thinking about buying a home and want it to be your "dream home"?  Let's think about your dream home, the financial impact, and your best path to one of the largest financial obligations that you will ever make.

Be practical:  Remember that “the perfect home” may not be available.  So develop some search criteria.  Make a list of the features most important to you and your lifestyle, prioritize your list and decided where you can be flexible. Then find a home that offers your "must have" features. Remember that compromise is a virtue! Paint, appliances and landscaping are items that you can take on one at a time as DIY projects. A little sweat along the way can turn into a good amount of equity when you are ready to sell.

Be budget wise: When you get pre-approved for a loan, you may be surprised by the amount for which you qualify. Be careful that you aren’t stretching to the last penny allowed by the lender. Be sure that you work with an amount that you feel comfortable spending every month. Taking on a mortgage that stresses your budget can cause you unnecessary stress in your relationships at home and work. So take an honest look at your budget.

Be selective:  When you buy a home, you are truly “putting down roots”.  Unlike renting, your contract isn’t short term.  Usually buyers go with a 30 year mortgage. According to a recent article, “Buy or Rent”, published by Zillow, the average time to break even in highly populated areas, is a little over two years. In less populated areas, the break even point may be closer to 4 years. So buy where you are prepared to stay for a while. Buy a home that will be easy to maintain. Remember to consider the upkeep - utilities, repairs and general improvements. Then keep it maintained. Doing a little work as you go will have you prepared when you are ready to sell.

Be an investor:  Realize that most Americans will buy more than one home during their lifetime. And the average turnaround time is only seven years. So buy the home that is comfortable for your budget and set time frames to trade up. Keep your eyes on the ball and you can “buy-up” to your dream home and be proud of your path as well.

WORRIED ABOUT SELLING YOUR HOME IN THE WINTER?

By Anita Tate, Century 21 West Main Realty & Auction

As temperatures drop and there are more dreary days than sunny, it’s natural for sellers begin to worry about selling their home during the winter months. To avoid the fears of your house staying on the market too long, here are a few tips that can make your home welcoming and appealing to buyers. 

Curb Appeal - First Impressions

Up Front: No matter the season, the first thing that prospective buyers see is the front of your house. So rake the leaves, sweep the drive, and trim those bushes! Taming the shrubbery is a must to enhance your home’s curb appeal. Overgrown shrubbery will actually make your house appear smaller. All bushes should be trimmed well below the bottom ledge of your windows. You have nothing to hide!

Helleborus blooming in the snow

Burst of Color: 

Winter doesn’t have to be drab. You can make your yard “pop” with various shades of green and textures of plants. You can create a dramatic effect with plants like helleborus and cyclamen that offer bright displays of color all winter. Pansies are favorites in climates that have fewer days of freezing. Color is unexpected in the winter. It will show buyers that you care and will set your home apart from other sellers who didn’t go for the extra effort and the small expense.

The Welcoming Entrance: 

Take a moment to stand at your front door as if it were your first visit. Look at the door, the hardware, and the welcome mat. For a low cost, you can make a huge difference. Paint the door in a glossy, bold color. Get new hardware or just polish and shine the old. Be sure to include your door knocker, lock-set, light fixtures, house numbers and mailbox. Replace your welcome mat with a new sea grass or coir mat and place potted plants on the landing. This small effort will do worlds to tell your buyers that they are import, they are expected and they are welcome. 

 All of these improvements can be accomplished in little more than a weekend, but what a difference they will make. Tidy, colorful and fresh vs. drab – you have greatly improved your odds over your competition. Selling in winter could be to your advantage! 

HOME SWEET HOME...WHAT'S YOUR STYLE?

A guide to America’s Most common Home Styles

By Anita Tate

          Styles of houses vary across the country.  From the New England Cape Cod to the Victorians of San Francisco, the choices are almost endless.  Knowing which style you prefer is one of the basic elements in your hunt for the perfect home.  Following is a quick guide to help you recognize and use the professional terms for many of the most prevalent house styles:

• Ranch:  these long, low houses rank among the most popular types
  
  in the country.  The ranch, which developed from early homes in the West and Southwest, is one-story with a low pitched room.  The raised ranch, which is also common is the U.S.. has two levels, each accessible from the home’s entry foyer, which features staircases to both upper and lower levels.
• Cape Cod:  this compact story-and-a-half house is small and symmetrical with a central entrance and a step, gable roof.  Brick, wood or aluminum siding are the materials most commonly seen.
• Georgian:  Popular in New England, the Georgian has a very formal appearance with two or three stories and classic lines. Usually built of red brick, the rectangular house has thin columns alongside the entry, and multi-paned windows above the door and throughout the house.  Two large chimneys rise high above the roof at each end.
• Tudor:   modeled after the English country cottage.  Tudor styling features trademark dark-wood timbering set against light-colored stucco that highlights the top half of the house and frames the numerous windows.  The bottom half of the house is often made of brick.
• Queen Anne/Victorian:  Developed from styles originated in Great
  
  Britain, these homes are usually two-story frame with large rooms, high ceilings and porches along the front and sometimes sides of the house.  Peaked roofs and ornamental wood trim, many times referred to as “gingerbread,” decorate these elaborate homes.
• Pueblo/Santa Fe Style – Popular in the Southwest, these homes are either frame or adobe brick with a stucco exterior.  The flat rood has protruding, rounded beams called vigas.  One or two story, the homes feature covered/enclosed patios and an abundance of tile.
• Dutch Colonial – the Dutch Colonial has two or tow-and-one-half stories covered by a gambrel roof (having two lopes on each side, with the lower slope steeper than the upper, flatter slope) and eaves that flare outward.  This style is traditionally make of brick or shingles.
• New England Colonial – This two-and-one-half story early American style is box like with a gable roof.  The traditional material is narrow clapboard siding and a shingle roof.  The small-pane,
  
  double-hung windows usually have working wood shutters.
• Southern Colonial –this large, two-to-three-story frame house is world famous for its large front columns and wide porches.
• Split-levels: Split-level houses have one living level about half a floor above the other living level.  When this type of home is built on three different levels, it is called a tri-level.  

These are just a few of the many styles of homes available across the

country - some are more prominent in different areas than others. Knowing home style terms will help you zero in on the type of house that will fill your needs and suit your taste.  For a more in depth look at architectural styles the history and functionality, read "What Style Is It?", by John Poppeliers and Allen Chambers.  It's a quick read and a great reference book. 

HOW TO SPOT A GOOD BUY

By Anita Tate, Century 21 West Main Realty & Auction

         Beauty is in the eye of the beholder,so how do you know that you have spotted a good buy?  Features that attract one home-buyer may repel another.

          However, the one feature of interest to every home-buyer is price.  Getting the most home for your money is paramount.  The real problem is figuring out whether that fixer-upper on one street is a better buy than the home in next-to-new condition two blocks away.  That’s why knowing what to look for before you buy can save you time, energy and money down the line.

          The first step is figuring out what kind of house you need.  A good buy is only a good buy if it meets your current and future living requirements.  Before shopping for a home, decide how much space you and your family require.  How many bedrooms, bathrooms?  Is a family room necessary?  Do you need a layout that will accommodate a lot of entertaining?  Do you prefer a spacious or compact work space in the kitchen?  If you have small children, can the house easily be childproofed?

          Evaluate the front and back yards.  Is there enough space to accommodate your children?  Do you want a park-like or garden setting?  Do you enjoy yard work and gardening, or do you want a low-maintenance yard?  Take into consideration the cost of extensive landscaping and upkeep.

          Next, determine how much work is required to make the house you are considering livable.  Make an honest assessment of your fix-it abilities.  How much

work are you willing to do or pay someone else to do?  Do you have basic decorating, carpentry and plumbing skills?  If you plan to learn as you go, make sure you have accurately determined what you are getting into.  Ask an experienced friend, family member or your real estate agent for their opinion, and be sure to consider how much remodeling inconvenience the rest of the family can handle.

          Unless you are ready and able to tackle a major remodel, look for a house or condominium that needs only cosmetic improvements.  These include painting, wallpapering and replacing items like flooring, window treatments, bathroom and kitchen fixtures, light fixtures, cabinet and interior door hardware and appliances.  Remember that even these simple changes can be costly if you have to make many of them.

          Beware of improvements that seem easy enough at first glance buy may turn into major headaches and require a lot of money once you’ve moved in.  Remodeled kitchens and bathrooms, changes to the floor plan, room additions and redesigned landscaping are examples of seemingly minor changes that can easily eat away the money you thought you saved by selecting a so-called “bargain priced” home.  Of course, you may be perfectly willing to spend whatever money is needed to customize the house to match your tastes and needs.

Make sure major systems in the house are in good working condition.  The furnace, air-conditioning and plumbing should be up to date, since repairs can be costly.  Your agent can arrange to have a professional inspector determine whether the electrical wiring and any room additions are to code.  Local utilities often offer free or low-cost inspections to tell you if the house is energy-efficient.

          Look for a house with universally popular selling points.  If you’re impressed, the next buyer down the line is bound to be, too.  For example, a roomy, modern east-to-clean kitchen is the best selling point a home can have.  A house with only one bathroom is less desirable than a house with two or more.  Many buyers expect at least three bedrooms, with a master bedroom that offers a feeling of privacy.  Lots of storage space and closets, especially walk-in closets, will be a real selling point.  Family rooms or “great rooms” also are desirable.  On closer examination, a house that looks like a bargain may lack some of these key features.

          Don’t forget the old adage:  location, location, location.  Unless you’re looking for a fixer-upper, the house should be in a condition that is comparable to other homes in the neighborhood.  Avoid buying the biggest or fanciest home on the block.  Consider the amount of traffic or noise.  Homes located in a quiet area away from a busy street will command a higher price.  Make sure the schools in your district have a reputation for quality education and safety.  Nearby supermarkets, gas stations, restaurants and theaters also will make a location more desirable.

          Good community facilities also add appeal; pools, athletic fields, community centers, libraries and hospitals all add to a neighborhood’s value and desirability.  Transportation needs also should be considered.  Is local public transit available?  How long are typical commutes to places of current and potential employment?  Are there several alternate route?  How close is a major airport?  All of these can affect a home’s pricing.

          Consider the cost of living in a home.  It’s important to consider not only purchase price but the monthly cost of living in a home.  Estimate your utility and maintenance costs.  For example, will the house need to be painted on a regular basis and will you need to spend money maintaining a swimming pool?  Ask your agent about the property tax rate and whether increases are anticipated.  Will you have to pay special assessments for a homeowner’s association?  Consider the point in the life cycle of major household systems, such as the furnace, air conditioning, roof and kitchen appliances.

         You can find a bargain!  Your first step should be to seek out a knowledgeable real estate agent with experience in the market areas where you wish to purchase a home.  Your agent can help you locate those properties that truly are “bargains” and help find the home that most closely matches your desires and needs.

Can Moving Be Stress Free?

Can Moving Be Stress Free?

by Anita Tate, Century 21 West Main Realty & Auction

          Moving and stress free are not terms normally found in the same sentence.  But in my 20 years of selling real estate, I have found that there are "moving best practices".  With a little preparation, you can dramatically reduce your level of stress.  The following are a few best practices that have worked for my clients.    

• Look at all the alternatives: hiring a moving company, for example, versus renting a truck and doing it yourself.  Whichever alternative makes most sense for you, get bids from more than one vendor.
•  A few days before the moving company is scheduled to arrive or you’re supposed to pick up your rental truck, call to confirm that everything is on track to happen when it’s supposed to.
•  Prepare your change of address cards in advance and send them out as soon as it’s appropriate to do so.  The post office, utilities, companies and people you do business with, city hall, friends, relatives – all should be notified of your move.

  

  Plan, Plan, Plan!

• Get an early start on packing by concentrating on seldom-used items first.  Each box should have its contents and the room those contents belong in written on it clearly. 
• Take a hard look at things you seldom or never use and throw away as many of them as you can.  The more you throw away, the less you’ll have to move.  Every item you throw away is one less item to clutter up you new home.
• Use your extra towels and linens to protect breakables.  When your supply of these things is exhausted, crumpled newspaper makes an excellent substitute.  Write “Fragile” on all appropriate boxes.
• Put your valuables (such as jewelry) and important documents (birth certificates, car titles, etc.) aside in some safe place where they won’t be misplaced.
•  When the house is empty, go back for a thorough final inspection.  Check closets, crawl spaces, basement, attic, out-of-the-way nooks and crannies of all kinds.  Have a second person make the same inspection separately.
•  Clean your new home thoroughly before moving in.  It’s infinitely easier that way.
• Decide in advance where you want the heavy furniture.  Changing your mind after the movers have departed is no fun – especially for your back!
• Locate all fuses, circuit breakers, and water/gas and electrical valves.  Record the meter readings and check the smoke detectors.
•  List the phone numbers of the local police and fire stations, doctors, nearby hospitals, etc.  Put a copy of your list near each phone.

Above all, plan, plan, plan and plan some more. Make a schedule you can live with, and then stick to it.  Preparation and forethought will help you to keep everything under control and finish the move with your sanity and your nervous system intact.