September 2016 M T W T F S S « Mar 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
- Spring has sprung….
- Have you outgrown your home?
- Take a LEAP this year.. to a new PAD
- Buying a house on emotion
- Owning a Home makes Finanical Sense
- Zeeba Hills, Hartford, WI – FOR SALE NOW!
- Can you become a FLIPPER?
- Is it better to sell your home or rent it out?
- Why buy a home?
- Ease – yyyyy
- Take a good look
- It’s Open house time — Are YOU ready?
- Women and Home Buying
- How to know if you are ready to buy a house
- Now or Later – You make the call
- Are you self emplyeed and wanting to buy a house?
- Do you know how much your home is really worth?
- Don’t move it!
- I was already PRE- Qualified
- How Much Does My Agent Need to Know About My Finances?
Posted: 01 Feb 2016 04:00 AM PST
We have reported many times that the American Dream of homeownership is alive and well. The personal reasons to own differ for each buyer, with many basic similarities. Eric Belsky, the Managing Director of the Joint Center of Housing Studies at Harvard University expanded on the top 5 financial benefits of homeownership in his paper –The Dream Lives On: the Future of Homeownership in America. Here are the five reasons, each followed by an excerpt from the study:
1.) Housing is typically the one leveraged investment available.
“Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money. As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.”
2.) You’re paying for housing whether you own or rent.
“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.”
3.) Owning is usually a form of “forced savings”.
“Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.”
4.) There are substantial tax benefits to owning.
“Homeowners are able to deduct mortgage interest and property taxes from income…On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.”
5.) Owning is a hedge against inflation.
“Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.”
We realize that homeownership makes sense for many Americans for an assortment of social and family reasons. It also makes sense financially. If you are considering a purchase this year, contact a local professional who can help evaluate your ability to do so.
What’s the Deal with Flipped Homes?
Americans love their home improvement and design shows. With entire channels dedicated to DIY, home decor and design, and everything related to U.S. real estate, we love the possibilities that lie within the real estate market in America. One popular aspect of many shows and publications is home or house flipping. We hear a lot about flipping homes, but what does that really mean? Is it feasible for everyone? Are there risks? Should you buy a flipped home, and what questions should you ask if your property search lands on a potentially flipped property?
What is Flipping?
Flipping is a predominately U.S. term used to describe purchasing a property with the intent of quickly reselling it for profit. Most of the time, properties that are purchased with the intent to flip are those that are distressed, abandoned, or otherwise in need of repairs that make the property less desirable to other potential buyers. Flipping has become increasingly popular throughout the U.S. in the last decade, and many people have become successful real estate flippers with the vast and varied real estate markets throughout the United States.
Can Anyone Flip a Property?
Many programs on television make house flipping look easily attainable to anyone and everyone. The fact remains that flipping a property is risky business that requires a large amount of work, experience, funding (preferably cash), excellent credit and a good understanding and almost intuitive knowledge of the real estate market. If you’re interested in flipping properties, the best way to get started is by talking to someone who has experience and has had success in flipping real estate. There are many things to know about flipping real estate that should be addressed before the idea is even entertained.
What are the Risks of Flipping a Home?
There are risks with any kind of real estate investment, but inexperienced flippers can make a number of mistakes. There are a number of costs that come with flipping a property, and new flippers can make the mistake of not having enough money to cover the entire project – from the acquisition of the property, to the renovations, taxes, utilities and more. Another risk of flipping properties is time, or lack of time. Finding the right property can take months, and once you own the property there is a time commitment to renovations, commuting, inspections, and ultimately the marketing and selling of the property.
Other risks that new flippers run into are not having enough knowledge about the real estate market and failing to purchase the right property for a flip; a lack of skills when it comes to working on the property and putting in the sweat equity (hard work) required to get it up to market standards; and ultimately lacking patience when it comes to the entire project as a whole.
Should I Buy a Flipped Home?
Often, flipped homes have mostly cosmetic changes done in order to attract buyers and ultimately get the property sold. You might fall in love with fresh paint and brand new appliances, and generally speaking, most flipped homes attract many buyers because they have a smaller initial to-do list than other properties on the market. If you’re looking at a property that could be a flip, be sure to ask these questions: What is the home’s sale history? If the home recently sold for much less than its current asking price, it’s possible it is a flip. Does the outside of the home match what’s inside? If the exterior of the home is older, and the interior looks brand new, it’s very possible someone is trying to flip the property. Information is your best friend when it comes to a flipped home, so getting the most information up front will help guide you toward pursuing the property or not.
If you believe you’re looking at a flipped home, consider asking the seller what changes have been made to the property, and check to see if any permits were issued for the work. Also, some buyers might be blinded by all the new interior cosmetic updates that they forget about the bones and foundation of the home. Regardless of whether a home is old or new, always hire an experienced and licensed inspector to check over the home to make sure you’re getting the most for your money when it comes to buying a property.
Contact me if you are interested in becoming a FLIPPER! Lisa Bear 262-893-5555 or email@example.com
Suddenly out of the blue you have found out that a new position has opened up within your company and they are asking you to relocate your family to the other side of the country. The job opportunity is too good to pass up so you decide to take the position. You realize with an impending move you are going to need to either sell or rent your home.
Considerations for renting or selling a home
Anyone who is considering selling a home in 2011 and has bought in the last six or seven years faces the real possibility that they will be losing money on the sale. The thought of losing money is never pleasant but unfortunately is part of today’s Real Estate reality. In my experience the immediate thought process of most home owners is to rent the home and not sell for a loss. This is kind of similar to the stock investor who hangs on for dear life with their losing picks but sells their winners instead.
In many cases they will ride the loser for an extended period of time until they realize it will take a very long time for that stock to come back to where it once was when purchased. Anyone who has ever invested in stocks including myself has been guilty of this. It is hard to give up on a loser because there is always the thought that it will come roaring back. So is renting the home really the best move or should you unload this asset that is working against you?
Where is the local Real Estate market headed?
One of the considerations of whether to sell or rent your home is to find out from a local Real Estate expert where they feel market values are headed both in the near term, as well as longer down the road. A knowledgeable Realtor that has been in the business for a while should be able to help you determine the trend of where the market is headed at least in the short term. Crystal balls are a hard thing to come by in Real Estate. Those that are lucky enough to have one are often times millionaires. Unfortunately knowing exactly when the Real Estate market will turn around requires one.
Most economists believe that once Real Estate markets do hit bottom the climb back up will be a slow and steady one. The opinions of most are that yearly appreciation will return to more normal historic levels of 3%-4%. Of course this is an average and states, cities and neighborhoods that are desirable could rise at a slightly higher clip.
As a home owner what you should be trying to figure out is how long will it take you to get back to a break even point or even something you can financially stomach. You should also be asking yourself is the time it takes to get back to break even worth it to you?
For example, lets say you bought your home for $500,000 and it has dropped in value by 25% and is now worth $375,000. Lets further assume that the Real Estate market beats the economists predictions and rises by 5% yearly. Do you realize it would take seven years to get back to break even?
If you have equity in the home you need to figure out if you would be better off taking the loss and putting your equity somewhere that could potentially earn you more money. If you don’t have any equity you would need to figure out if you have the necessary funds to bring to the closing table or would need to explore other alternatives like a short sale.
Again you should consult with a local Realtor to determine how well the rental market is performing. Has the rental market done as poorly as the Real Estate market or is there demand for rental housing? Some areas rental markets have done very well.
There is a good possibility there are folks who would like to rent a nice home rather than commit to purchasing if they feel they could be transferred in a short time period or feel market values are still sliding and don’t want the risk.
The rental home becomes an investment property
Relocating home owners need to remember that a rental home becomes an investment property. Owning a home as an investment property has the potential to help or hurt you tax wise. This is definitely something you would want to consult a tax professional for guidance.
Although you will be taking in rent you need to remember that you will still have principal, interest, taxes and insurance to pay. If the property is a condo you would more than likely also be paying the condominium fees as well. As a landlord you will also be required to maintain the property and fix any necessary issues that come up.
Many landlords that have relocated out of state will also consider hiring a property manager. The typical charge for management services runs around 8-12% of the rent. So if you are charging $2000 a month for rent you can expect to pay a manager in the neighborhood of around $200 a month. There are some excellent tax deductions for rental property that could play a factor in your decision making.
Taking on landlord responsibilities
As a landlord one of the 1st steps is going to be choosing the right tenant. Over the years I have seen a few occasions where the renter did not treat the home the same way an owner would. The owner was left with paying to replace carpets and do quite a bit of painting. These kind of costs can add up fast. Picking a responsible tenant becomes critical.
There are also considerations such as handling tenant complaints, maintenance issues or even legal issues such as eviction. In the end there is a lot to think about when deciding whether selling or renting your home makes the best fiscal and practical sense.
1. Master bedrooms and baths should appeal to both sexes – if yours is gender specific, balance it with some masculine/ feminine accessories – pillows, art, greenery, a well placed throw and use neutral bedding – your grandmother’s homemade quilt isn’t going to cut it!
2. Walk through each room as if you were a buyer – can you move freely about? If not, open up the space by eliminating excess furniture to create easy traffic flow. when selling – less is always more!
3. If possible rent a small local storage space to put excess furniture, personal items, knickknacks – anything that clutters the home and causes distractions – after all, you’re selling your home, not your lifestyle. (This also eliminates a lot of stress down the road when the buyer is ready to move.)
4. Assess the color palate of your home —make sure it’s uniform throughout and stick to neutral or modern colors – this creates continuity. Add pops of color using accessories like pillows, art and a throw.
5. Think upscale hotels – clutter free, updated and designed to appeal to the masses. If you have dated boarders or wall paper take it down – this is one of the biggest turnoff to buyers and they often move on. (I’ve heard of homes for sale labeled as the “wallpaper” home and it’s not a compliment!
6. Don’t assume buyers won’t look in cabinets, closets, basements and attics.
Storage is key for buyers and they want to see if the home has enough space to accommodate their stuff. Organize, or better yet store it- this demonstrates to buyers that indeed their things will fit and is a big selling advantage.
7. Clean, Clean, clean – It’s the easiest, no cost, effective fix and this can’t be emphasized enough – nothing turns a buyer off more than a messy, dirty or smelly home – this will send buyers running for the door – trust me on this one!
8. Open all blinds, eliminate heavy window treatments and let the natural light shine in – this cheers up and brightens the home, making it feel airy and more spacious – and, it’s so easy! If you have dated vertical blinds, it best to take them down
9. Fix leaky faucets, broken screens, door hinges, door bells or running toilets – Yes, I’m going to beat a dead horse, but these are big turnoffs and don’t invoke any confidence in the buyer that your home is well taken care of – you know the kind of homes we all want to buy!
10. Make sure your MLS photos are GREAT – 80% of buyers shop online before ever stepping out the door with their Realtor!
Okay, so I lied, #11 – drum roll please…
My list wouldn’t be complete without strongly suggesting hiring a professional stager who is trained to prepare your home for the market, using proven techniques to enhance, highlight and showcase your home it its best possible light and appeal to the most buyers!
Home and Curb Appeal LLC- Lisa Bear – (262)893-5555
When you’re looking to sell quickly and for top dollar, Home and Curb Appeal LLC – Lisa Bear knows how to get the job done right. We will use proven techniques to create warm, inviting, updated spaces that will appeal to the masses. In today’s competitive market, every home can use an edge and that’s what Home and Curb Appeal is all about.
Courtesy of Lisa Bear RE/MAX Realty Center