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Better Homeowners


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  Pre-Approval Is Good For Everyone 

  Buyer’s mortgage pre-approval is good for everyone in the transaction. It saves time, money and removes the uncertainty of knowing whether the buyer will be qualified after negotiating a contract. The direct benefits include:
  • Looking at “Right” homes - price, size, amenities, location
  • Find the best loan - rate, term, type
  • Uncover credit issues early - time to cure possible problems
  • Negotiating power - price, terms, & timing
  • Close quicker - verifications have been made 

There is a significant difference in having a trusted mortgage professional take a loan application and run all the necessary verifications compared to going through calculators on a lender’s website. Beside the peace of mind, the cost of being pre-approved is a bargain and generally, limited to the cost of the credit report.

Even if a person has been pre-approved, a second opinion from a different lender may be a good option. It can verify there is a good deal or you’ll discover that you can improve it. Either way, it works to your advantage. Contact me if you’d like a recommendation of a trusted mortgage officer.

Better Homeowners

Don't Have a CLUE?

If you haven’t heard of a CLUE report, it has nothing to do with the table game searching for a murderer. It is a report showing the insurance claims on your home and car for the past five to seven years.

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This database is used by insurance companies to evaluate risks and determine rates. C.L.U.E. stands for Comprehensive Loss Underwriting Exchange. Rates can be increased not only due to legitimate claims but data entry errors also. Sometimes, simply asking a question without filing a claim can be logged as a claim.

For that reason, similar to verifying the accuracy of your credit report, it is important to check out the CLUE report on your home and car. The reports are free and there is a process for correcting mistakes.

An interesting and sometimes costly surprise occurs during the home buying process. The claim experience of the prior seller could impact the price of the premium of the new buyer. For that reason, you can ask for a copy of the CLUE report on the home you’re interested in buying prior to writing a contract.

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Common Pests and Your Home

The list of new responsibilities can seem overwhelming when you buy a home or become a first-time homeowner. One responsibility that tends to get overlooked until it becomes a larger issue is that of household pests. A household pest is "a destructive insect or other animal that attacks" your home. Pests range throughout the U.S., but the most common pests are those that have become almost commonplace in our lives. Here are some of the most common pests encountered by homeowners throughout the U.S., and what you can do to help prevent pests in your home.

Most common Spring and Summer Pests:

Termites

Termites are generally grouped by their nesting and feeding habits: subterranean, soil-dwelling, dry wood, damp wood and grass-feeding. They feed on dead plant material, generally in the form of wood, leaves, soil and animal dung. Termites can cause significant structural damage to buildings. Those classified as subterranean and dry wood are those that are responsible for the damage to homes.

Ants:

Ants are the most common household pests in the north central states. They are social insects, and they have a wide variety of nesting habits. Ants can build nests in soil, behind moldings, baseboards and counter tops, and some types nest in decaying or moisture damaged wood. Ants will feed on all types of food, and ant damage varies. Most ants cause little damage, but carpenter ants can weaken wood structures similar to termites, and the majority of ants don't transmit diseases.

Flies:

Flies are some of the most annoying pests in the home. They land on almost every surface, and their diet includes a wide variety of foods: human food, animal food, animal carcasses, garbage and excrement. Flies also carry germs and diseases. They are known to transfer over 100 pathogens, some of which include salmonella, anthrax, tuberculosis, and the eggs of parasitic worms.

Spiders:

Spiders are generally not harmful and they do feed on other insects like flies and other spiders. Most spiders found in the home are not venomous, but there are some that homeowners don't want to find inside their house. The Black Widow and Brown Recluse are two of the most talked about spiders homeowners do not want to find in their homes. Black Widows can be found throughout the U.S., and Brown Recluse are predominately found in the Midwestern States, most notably Oklahoma, Arkansas and Missouri. All spiders have the ability to travel to all states by ways of hiding in boxes, packages and produce.

Most Common Fall and Winter Pests:

Stink Bugs:

Stink bugs are found throughout the U.S., and most of the time homeowners don't know they have an issue until early fall, when stink bugs turn up on the sunny side of homes where they can warm themselves. During the summer months stink bugs live outside, feeding on fruits, grains and other crops. During the colder months, stink bugs will hide inside walls or in attics and crawl spaces. These bugs get their name from the unpleasant odor they produce when they feel threatened.

Rodents:

Rodents are warm-blooded and are found throughout the U.S. The most common types of rodents are mice and rats. Both rapidly breed and are capable of squeezing through spaces that appear smaller than their bodies. Rodents seek warm shelter in the cold months, particularly mice, who seek food, water and warmth within homes. Generally, if one rodent is found, many more are hiding nearby.

How to Avoid Pests:

Most home pests can be avoided by doing simple, everyday things. As a homeowner, make sure your doors and windows are closed, as these are the most common ways for pests to enter a home. Make sure window and door screens are in good repair or working order. By eliminating moisture buildup in small areas and basements you reduce the risk of creating hospitable environments for pests. Sealing openings in a home's foundation will help reduce access to your home.

Trees harbor pests -- by keeping tree branches trimmed and away from the home you deter pests (especially spiders) from having easy access to your home's roof. Moisture attracts pests -- direct rain water away from the home and foundation to prevent possible moisture buildup. If you have fire wood, store it at least 20 feet away from the house. Flies and other pests are attracted to garbage, so ensuring that garbage cans are sealed tight and all animal deposits are picked up will help reduce the risks of attracting pests into your home. The best deterrent to pests remains a clean, uncluttered home, where food, crumbs, and anything else that has the potential to attract pests is put away, covered or thrown away.

Terry Forsberg
License #: BR005041000
RE/MAX FINE PROPERTIES
21000 N Pima Rd Ste 100, Scottsdale, AZ 85255
Cell: (602) 410-9547
Business: (602) 410-9547
Email Us: terry@terryforsberg.com
www.terryforsberg.com

 
 

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RE/MAX Holdings, Inc. is an Equal Opportunity Employer and supports the Fair Housing Act.
© 2015 RE/MAX Holdings, Inc. Powered by Homes.com
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Better Homeowners

Must Be This Tall to Ride

Surely, you remember being a child at an amusement park when after having stood in line with your friends and family, waiting to get on a terrific ride, you discovered the sign that read, “you must be this tall to ride.”

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Not only was it disappointing, it was slightly embarrassing. You never want to go through that again.

A remarkably similar situation occurs when people are buying a home. After finding the right home and negotiating the contract, they find out that they don’t measure up financially. It’s not something that anyone wants to go through if they have a choice.

Regardless of what you think you know, if you’re buying a home with a loan, you need to physically visit with a trusted mortgage professional before you get serious.

  • You’ll find out your credit score which will directly affect the mortgage rate you’ll pay.
  • You might discover blemishes on your credit that possibly can be corrected.
  • You’ll even get a pre-approval letter that you can submit with an offer which could dramatically affect your negotiations in the current competitive market.

Some rides don't turn out to be as good as you thought they were going to be. A person certainly doesn’t want that disappointment with a lender. Contact me for a recommendation of trusted mortgage professional.

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Alternative Energy and Your Home

We all appreciate electricity -- each one of us uses it in some capacity every day. Heating and cooling our homes is one of our top priorities, not only for our comfort but also for our safety. In recent years more and more information about alternative and green energies has become available to consumers. Green or alternative energy is energy that is produced from renewable resources: wind, water, or sunlight. Here are some of the most-readily available options for alternative energy systems offered to home buyers right now:

Solar Power

Solar power is "the power obtained by harnessing the energy of the sun's rays." This is done through solar panels and photo voltaic cells on the panels, which convert the sunlight into usable energy. Solar power is the most common and popular option for homeowners looking to take the first step toward alternative energy. Solar uses the power of the sun, so this option is best for homes or properties located in areas where sunlight is strong year-round. There are three types of solar panel systems: On-Grid Battery Systems, which are connected to the grid but also contain batteries that can store excess energy; On-Grid Systems without batteries – these are more simple and easier to install, but if the power goes out in the area the system will shut off; and Off-Grid Systems, which are not tied to the electricity grid and generate all their power independently.

At the current moment, solar power accounts for three-tenths of one percent of the total energy consumed in the U.S. (instituteforenergyresearch.org/). For those who live in year-round sunny climates – California, Arizona, Hawaii, etc. – a solar panel system can pay for itself in as little as three years (judithcurry.com).

Wind Power

Another popular alternative energy option that has been seen throughout the U.S. is wind power. Wind power is the "power obtained by harnessing the energy of the wind." Modern wind power uses wind turbines to harness wind's kinetic energy, which is then turned into electricity. There are different types of wind power: Utility-scale, which are the large wind turbines seen on the side of hills-- these are larger than 100 kilowatts and deliver electricity directly to the power grid; Distributed, which are smaller turbines, 100 kilowatts or less, and these deliver electricity directly to a home or small business. There are also offshore wind turbines, but these are mostly found outside the U.S. At the current moment, the U.S. receives about 4.1 percent of its electricity from wind power (www.awea.org/ ).

Wind power is an excellent option for those who live in areas where there is a good source of wind all year long. Initially, wind power systems can be expensive, and the turbine prices vary depending on the type, manufacturer and the area you live in. Many people look to the advantages of wind power over the initial investment – utility bills are cut and the homeowner has control of knowing how his/her energy is generated, and there are generally federal tax credits available to those who buy a wind power system.

Geothermal Power

Geothermal power is "the heat from the Earth." Geothermal power takes advantage of the earth's natural heat. Geothermal energy is harnessed in two ways: tapping extremely hot temperatures via steam at great depths, or the use of moderate temperatures at shallow depths (http://instituteforenergyresearch.org/ ). In almost all parts of the U.S., the shallow ground (upper 10 feet of the Earth's surface) maintains a nearly constant temperature of 50 to 60 degrees Fahrenheit. To use this naturally occurring heat, consumers can install a geothermal heat pump. The pump utilizes air or antifreeze liquid in pipes. The liquid or air is pumped through the pipes, which are buried underground, and comes back into the building. In summer, when the temperatures are hotter above ground, the liquid or air moves heat from the building into the ground; in the winter, when temperatures are colder, the pipes pump pre-warmed air or liquid into the building. Geothermal power is also a renewable energy that can supply continuous power (www.ucsusa.org/ )

Geothermal systems can be expensive to set up, with estimates into the low $40,000s. There are tax credits available, which can cover 30% of the total cost of a new geothermal system. Geothermal systems last about 20 years before needing new parts, and over the course of a 20 year lifespan, these systems can save homeowners upwards of $60,000 in electricity costs (www.esquire.com/ ).

The U.S. relies heavily upon fossil fuels for its energy sources. Currently, 82 percent of U.S. energy demand is met by fossil fuels (coal, petroleum (oil) and natural gas) while the other 18 percent is met by renewable energy and nuclear energy (instituteforenergyresearch.org/). Electricity is a vital part of the U.S. economy, and it helps a household run every day. Homeowners have options in every facet of their lives, and energy is no different. Fossil fuels are a finite resource – exploring other options available to homeowners not only opens up access to other technologies and ideas, but it also helps the Earth. Alternative energy also presents more reliable and efficient energy sources. When a homeowner or consumer gets more reliance and efficient energy, more money is saved in the long run, making for a happy, safe and sustainable home.

Terry Forsberg
License #: BR005041000
RE/MAX FINE PROPERTIES
21000 N Pima Rd Ste 100, Scottsdale, AZ 85255
Cell: (602) 410-9547
Business: (602) 410-9547
Email Us: terry@terryforsberg.com
www.terryforsberg.com

 
 

Each Office Independently Owned and Operated.
RE/MAX Holdings, Inc. is an Equal Opportunity Employer and supports the Fair Housing Act.
© 2015 RE/MAX Holdings, Inc. Powered by Homes.com
Privacy Policy

You are receiving this email to inform you of products or services that may be of interest to you. This email was sent to . If you would like to unsubscribe from this email list, please click here

Will Your Home Be Ready for Aging in Place?

Most aren’t, but a toolkit of winning ideas makes it easier to plan for changes

May 3, 2017

Part of the TRANSFORMING LIFE AS WE AGE SPECIAL REPORT

A modest home in the Memphis suburb of Raleigh — a vacant foreclosure — used to be dark inside, an interior that was frankly depressing, recalls David Brown, CEO of Home Matters, a nonprofit based in Washington, D.C., that’s committed to increasing the country’s affordable and accessible housing. Now, the Raleigh house has been remodeled based on a winning design concept from an AARP competition, Redefining Home: Home Today, Home Tomorrow. Sponsored by Home Matters and others, the aging in place competition took in entries and announced a winner last year.

The remodeled house features a no-step entry and an easily accessible wraparound porch. Inside, there’s lots of light, and the hallways and doorways have been widened. Moveable walls can be used to alternately create a bedroom or a larger living room space for gathering family or friends.

There’s one more important improvement, as the Memphis Commercial Appeal reported in February this year: the house is now occupied. After the rehab, it was donated to Walter Moody, a 54-year-old Army veteran. He moved in with his family, including his 77-year-old mother, Mary Moody, who, because of the design changes, is able to move easily from room to room with her walker and wheelchair.

Front-yard box gardens invite neighborly interaction, says Gabriel Espinoza, a member of IBI Group’s winning design team.

An open floor plan makes it easier to maneuver with a walker or wheelchair.
An open floor plan makes it easier to maneuver with a walker or wheelchair.

Redefining Home was aimed at the challenge of adapting the country’s existing suburban housing stock to the needs people have as they age. A brief for architects and designers entering the competition asked them to create homes where people can stay “as they travel through various life stages.”

Along with Home Matters, AARP and the AARP Foundation, sponsors of the competition included Wells Fargo, the Home Depot Foundation and Dwell magazine.

Just 1 Percent of Homes Are Conducive to Aging in Place

“This competition and one we did in 2015 asked designers and architects to redefine home and re-imagine the home of the future,” Brown says. It’s great to work on building more affordable housing, he says, but Redefining Home was about finding practical solutions to another of the nation’s housing crises. There’s a pressing need to remodel and retrofit homes like the one in Raleigh, Tenn.

There are more than 100 million homes in U.S. cities, suburbs and rural areas, yet only about 1 percent of them are conducive to aging in place, says Rodney Harrell, director of livability thought leadership for AARP, who serves as the organization’s housing expert. Meanwhile, 10,000 Americans turn 65 every day, and more than 80 percent of those 65 and older say they want to stay in their homes.

“The housing stock right now is not meeting people’s needs,” says Harrell. Designs like those generated in the Redefining Home competition “serve as ways to create attractive housing that will meet those needs and at the same time be functional and beautiful.”

Guided by Universal Design

The winning design in the competition came from the New York architectural firm IBI Group – Gruzen Samton. Like many of the entries, IBI’s plans were influenced by a concept known as universal design.

It’s not a new idea, but universal design is being “discovered” by more people because of what the approach has to offer to an aging population, says Richard Duncan, executive director of the R.L. Mace Universal Design Institute in Asheville, N.C., who served as a judge for Redefining Home. The Mace Institute describes universal design as “the design of products and environments to be usable by all people, to the greatest extent possible, without the need for specialized design.”

The curbless shower is easy to step or roll into and features a bench for sitting.
The curbless shower is easy to step or roll into and features a bench for sitting.

Principles of universal design focus on safety, ease of movement and attractive design for all ages and abilities, inside and outside, according to Home Matters. They can be applied to home building and remodeling, workplaces and public spaces such as parks, and community development.

Put another way, universal design is ageless design. “You can call it 8-to-80 or lifelong-living [design]” Duncan says. The point is to create an environment that “responds to people over their lifespan through all of life’s changes, not just when older.” That might mean installing sinks at different heights or using lever-style faucet and door handles because they’re easier for anyone with painful joints or a weak grip to turn.

Universal design isn’t all about function, however. It also focuses on aesthetics, moving beyond solutions that “look accessible” to a more standard appearance, Duncan says. “Regardless of features, people want regular-looking homes.”

Beyond Grab Bars to Quality of Life

“The aging demographic is looming large,” says Duncan. Age isn’t the only reason to pursue more accessible design, but “it does add to the urgency to do it.”

Proponents of universal design encourage young and middle-aged homeowners to think ahead and integrate age-friendly changes to homes as they remodel and update them through the years. It’s more affordable to incorporate accessibility and ease of use as part of an already-planned renovation project than it is to apply universal design later on as its own separate round of remodeling.

Homeowners can also think about the meaning of universal design very broadly. In the Redefining Home competition, entrants were asked to develop solutions based on flexible, simple and intuitive use, and to make the home attractive, adaptable and affordable. They were encouraged to think not only about things like grab bars and specific functionalities, but to keep in mind quality of life, too.

At the Raleigh house, for example, new front-yard box gardens invite neighborly interaction, says Gabriel Espinoza, a member of IBI Group’s winning design team.

“When you age, you want to stay connected with your neighbors to create a better community and better quality of life” for yourself, Espinoza says.

Ideas to Get You Started

Moody was chosen to receive the remodeled house in Raleigh, the Commercial Appeal reported, because of his military service, his desire to create a safe place to build his life and his interest in having his mother live there. “Aging in place will allow me to live in this home and grow old,” he told the crowd at the ribbon-cutting ceremony in February. “Family will gather at my home during special holidays [creating] fond memories.”

To make your home more amenable to a long-term vision like Moody’s, think about how you can start adding features like these, suggested by the experts involved in the Redefining Home initiative:

  • Stairless entries
  • A gradual outdoor incline up to the entry instead of ramps
  • Low or no thresholds at doorways
  • Doorways wide enough to accommodate wheelchairs and walkers
  • Widened hallways
  • Lever-style doorknobs
  • Lever-style faucet handles
  • Shallower countertops to put items in easier reach
  • Curbless shower stalls
  • Open-concept floor plans that provide better lighting, shorter hallways and easier movement
  • Single-floor living that includes a kitchen, bathroom, bedroom and laundry on the same floor
  • Flexible living spaces that can change size or be used for more than one purpose
  • Slip-resistant floors and lighter-color floors for greater visibility
  • Lower placement of light switches and higher placement of electrical outlets
  • More windows for better indoor light

You can learn more from the Home Today, Home Tomorrow design competition toolkit for homeowners that was released this spring.

15 Ways Retirement Will Change in 2017

Some might create uncertainty for millions of people

January 5, 2017


Workers planning to punch the clock for the last time during 2017 might need to curb their enthusiasm, or at least curtail retirement travel plans. Dramatic changes in everything from interest rates to health care costs could be just over the horizon.

Indeed, many financial planners are advising clients to put their portfolios, savings strategies and tax planning under a microscope. Below are 15 ways financial planners said retirement might change — and some ways it is certain to change — this year. Learn what you can do to protect your portfolio and pocketbook in the face of these retirement changes.

1. Interest Rates and Mortgage Rates Might Rise

The Federal Reserve increased its key interest rate by 0.25 percent in December. Some experts think president-elect Donald Trump’s economic policy team will favor an even more aggressive approach to raising rates in an effort to squelch any hint of robust inflation.

Inflation isn’t necessarily a bad thing. It just means you have to understand how to keep up with it.

— Jason Silverberg, Financial Advantage Associates

“What that means is that interest rates will go up for mortgages, for one,” said Don Chamberlin, president and CEO of The Chamberlin Group, a tax and wealth advisory firm in St. Louis. “So, if someone who is retiring is thinking about refinancing their mortgage to have a lower payment throughout their retirement, they may need to do that sooner rather than later.”

2. CDs Might Gain Ground

Rising interest rates could offer some savers a boost. Certificates of deposit insured by the Federal Deposit Insurance Corp. have long been considered one of the safest investments, especially for retirees who want to limit their risk.

If the Federal Reserve boosts the federal funds rate in 2017, certificates of deposit will reap higher returns. Over the long term, that could lead some conservative investors to opt for CDs over stocks and other options that weren’t very attractive when interest rates were low.

“People may be putting more money into those types of asset classes and that could eventually affect the stock market in that the market may not be as attractive a place to put money if we have higher rates for CDs,” Chamberlin said.

3. Bond Values Might Take a Hit

Interest rate increases have a more immediate impact on bonds. A bond is essentially a loan that the bond’s buyer makes to the bond’s issuer. The issuer pays the bond’s purchaser interest at a so-called coupon rate that is fixed when the investor buys the bond.

Since coupon rates for most bonds are close to the prevailing market interest rate, bonds purchased and issued in a low-interest-rate environment reap lower returns than bonds bought when interest rates are higher.

Bondholders who want to sell existing bonds issued at lower coupon rates have to dump them at a discount to make the bonds appealing to consumers who can otherwise simply buy newly issued bonds with a higher coupon rate.

“There’s an inverse relationship between rates and the price of bonds. In other words, when interest rates go up, the value of (existing) bonds goes down,” Chamberlin said. “Everybody’s known that, at some point, interest rates had to go up.” With the new administration about to take office, “it’s time to be even more cautious” when choosing investment options potentially affected by rising rates, he said.

4. Lower Returns Likely for REITs

Rising interest rates can affect real estate investment trusts (REITs) as well, according to H. Brian Adcock, president at Adcock Financial Group in Tampa, Fla. He has advised clients to take a close look at the income-generating investments in their portfolios, including REITs.

“Ringing in the new year may come with some additional focus on where retirees will get their income,” Adcock said. “Some retirees have been able to harvest the benefit and income provided by many publicly traded REITs.”

But with interest rates on the rise, REITs will face headwinds and might struggle to repeat the returns they have reaped in recent years, Adcock said.

5. Some Mutual Fund Risks Could Grow

Retirees and those approaching the end of work might also want to consider shifting holdings out of some types of mutual funds. Several factors can adversely affect returns in such funds, including the mutual fund manager’s investment decisions, and divestments by other investors in the fund.

“Bond and REITs mutual funds will come with other risk outside of rising rates,” Adcock said.

Adcock said retirees must pay attention not only to the type of income-producing investment they select, but also the vehicle they use to hold that investment. So, for example, it might make sense to purchase bonds directly rather than through a mutual fund.

“Investors may consider holding bonds directly where pricing will still go up or down, but the income will be more reliable and they know the maturity and risk of their holdings,” Adcock said.

6. Access to IRAs Will Be Easier

Several states are in the process of setting up retirement savings programs for workers who don’t have access to plans through their employers. Some state programs, often called Secure Choice plans, require business owners who don’t offer a workplace retirement savings plan to enroll employees in an individual retirement account. Others make enrollment optional.

Regardless of the specifics, such plans will make it easier for millions of workers to set savings aside for retirement, said Kate Crowther, director of government relations for Ubiquity Retirement + Savings, a flat-fee, web-based retirement plan and benefits provider.

“These programs, and the legislation creating them, are critical because 75 percent of uncovered workers will not seek to save on their own,” she said. “Given the new environment, we will see financial institutions expand their product offerings to capture a segment of this market.”

7. Tax Cuts Probably Are Coming

Trump’s proposed tax plan would cut the average tax bill in 2017 by $2,940, or 4.1 percent of after-tax income, according to an analysis by the Tax Policy Center. The specifics vary significantly depending on income levels, however.

For example, the top 0.1 percent of earners would see an average tax cut of nearly $1.1 million, more than 14 percent of after-tax income. Meanwhile, the poorest households would see taxes go down an average of $110, or 0.8 percent of their after-tax income.

If those cuts come to fruition, it might make sense for some eligible retirees to convert traditional IRAs to Roth IRAs. That is true even though they would pay income tax on the contributions built up in the traditional IRA when they convert.

With traditional IRAs, savers get a tax break when they make contributions, but must pay income taxes on withdrawals made after they retire. By contrast, both investment growth and withdrawals are tax-free for Roth IRAs.

“So paying taxes at a lower tax rate in 2017, ‘18 or ‘19 may be a good way to kind of lock in the taxes at an (attractive) rate and never have to worry about taxes again on that,” said Jason Silverberg, vice president of financial planning at Financial Advantage Associates in Rockville, Md.

8. You Might Get a Higher Standard Deduction

Trump’s tax plan also calls for an increase in the standard deduction, to $30,000 for married couples filing jointly — compared with $12,600 currently. Single filers would see their standard deduction jump from $6,300 to $15,000.

“So if your standard deduction is actually higher than your itemized deductions, you’re going to want to take your standard deduction,” said Silverberg, author of the forthcoming book, The Financial Planning Puzzle.

A higher standard deduction could have several implications, depending on a retiree’s specific circumstances. For example, if you have been considering selling your home and downsizing to an apartment or other rental, giving up the mortgage interest deduction might not seem like such a sacrifice under a tax plan with higher standard deductions.

9. Investment Advisers Will Face New Rules

New rules regulating the investment-advice industry are set to take effect in April, although Trump’s election has cast some doubt on the fate of the U.S. Department of Labor’s so-called “fiduciary rule.” The rule requires investment brokers and advisers to put the best interest of their customers first when offering retirement investment guidance.

Put simply, the rule’s goal is to eliminate conflicts of interest for brokers and advisers who might receive higher commissions and other incentives for certain products they sell. Investors — especially those planning for retirement in the near future — should keep this rule on their radar as Trump settles into office.

10. Health Care Costs Will Rise

For current retired clients, Silverberg typically budgets $1,000 to $1,200 a month for Medicare and Medigap health insurance premiums, deductibles and other out-of-pocket costs. Those allocations are on the generous side, in part because of the trend toward higher health care costs.

“Whether it’s through the Affordable Care Act or some other program, it doesn’t matter — health care costs are going up,” he said. “What I do know is that there is a lot of uncertainty there, and it’s better to err on the side of caution.”

11. Inflation Will Become More Likely

Inflation is often seen as a dirty word, especially for retirees who aren’t bringing home annual salaries and regular raises. But some inflation can help stimulate the economy.

“Inflation isn’t necessarily a bad thing,” Silverberg said. “It just means you have to understand how to keep up with it.”

He advises clients to consider keeping some blue-chip stocks in their portfolio rather than relying on CDs and other investment options that might not outpace inflation, especially after taxes are taken into account.

“If you buy safe, blue-chip stocks, you can collect the dividends and have a little bit of inflation protection,” he said. Silverberg added that “over the long run, a stock portfolio will go up.”

12. Social Security Benefits Will Rise Modestly

The federal government has settled on just a tiny cost-of-living adjustment of 0.3 percent for Social Security benefits in 2017. This change is expected to increase the average Social Security check by $5, to $1,360.

The Social Security Administration projects retired couples will get $2,260 per month in 2017 on average, up from $2,254 in 2016.

13. More Income Will Be Subject to Social Security Taxes

The cap on earnings subject to Social Security taxes will increase from $118,500 in 2016 to $127,200 in 2017. Employees typically contribute 6.2 percent of their income up to that cap, with companies contributing a matching amount into the Social Security system.

While this change won’t have much impact on people who plan to retire at the dawn of 2017, it will affect some who retire later in the year — increasing both their contributions and, possibly, their retirement payments.

14. Social Security’s Future Will Remain Murky

The Social Security trust fund balance will reach zero around 2034, according to the Social Security and Medicare boards of trustees’ most-recent annual report. That means by 2034, the system will only bring in enough revenue to cover 79 percent of the benefits it has promised.

Although nothing has been set in stone, lawmakers could reform the Social Security system in several ways, including increasing Social Security taxes or raising the retirement age. Such uncertainty leaves those planning for retirement — regardless of their age — with some question marks in their financial planning.

“At some point, Social Security needs to be changed. We know that,” Silverberg said. “I think people have a lot of fears about Social Security and what it’s going to look like.”

15. Uncertainty Will Increase

Don’t let uncertainty create fears that keep you from relishing retirement. Just make sure you have a well-vetted plan.

“I think the takeaway here is that a retiree should really seek out professional guidance,” Silverberg said. “You want to stress-test your financial plan to manage the risks that you may not see. To have someone help you through that is worth the fees you would have to pay because, now, you can sleep at night.”

9 Mistakes Sellers Make When Hiring a Listing Agent

Hearken back, if you will, to the place and time when you bought your first home. If you were like most buyers, your best case scenario was to find an agent who was part money manager, part negotiator extraordinaire and part therapist to help you through the process.

But your priorities might be - scratch that - should be a little bit different when you’re looking for an agent to help you price, list, market and sell your home.


There are loads of lists to be found online and in books about the questions you should ask when you interview listing agents. But it’s a lot harder to figure out what mistakes the sellers who have gone before you would avoid, if they could. Fortunately, that’s what we’re here for.


I’ve heard from thousands and thousands of sellers over the years, online and off, about the things they neglected to do when they were selecting their listing agent - the omissions they regretted later. Here are the top nine – and in the comments, I’d love to have you all share more!


1. They don’t totally understand the nature of the challenge.
You’re not looking for a new BFF or even for an agent who has the temperament and patience to deal with your cranky husband. Selling a home quickly and at top dollar requires a concentration of marketing and negotiations skill and less interpersonal skill, compared with buying. So your challenge as a Seller looking to hire an agent is to feel comfortable that the listing agent you hire has:

  • a strong, documented track record of accomplishing the results you seek for their recent, nearby listings (which might include some marketing through their local agent relationships, but might not) and
  • a strong, proactive, well-thought-out plan for helping you achieve the same success.


I’ve seen a number of sellers who list with friends or relatives that don’t have such a track record often fail to get the results they seek, even if their agent is a lovely human being with strong skills getting homes sold 3 states over in a totally different marketplace with totally different market dynamics.


2. They fail to understand roles and responsibilities.
When sellers have a bad home-selling experience, 9 times out of 10 that means that their home lagged on the market, sold for way below listing or was in and out of escrow a bunch of times. Sometimes, the fault for these things does fall on the listing agent, especially if there was some sort of huge marketing fail, like the place was listed online with no photos or it was somehow otherwise not fully exposed to the market. But many, many times the fatal flaws I see in listings are things that are (a) decisions the Seller themselves ultimately made, and (b) the Seller made in direct opposition to their agent’s advice.

Overpricing a property for the market dynamics, failing to handle some major condition or aesthetic issues and/or making it unavailable for showings are 3 things that listing agents spend much of their working lives advising sellers to do differently - which is advice most unhappy Sellers ignore or refuse to follow.


As you interview listing agents, talk with them about which pieces of the process of getting your home sold are things they are responsible for – and which pieces you are ultimately accountable for. And as you walk with them through their plans for preparing, pricing and marketing your home, if you find yourself feeling like pushing back against every thing they say, consider whether that dynamic will truly serve you well throughout your transaction. Hiring the best agent ever means very, very little if you refuse to follow their advice, whether your reasons for refusing are right or wrong.


3. They omit to ask for the right data – or for any data at all.
Sometimes, the power of an agent’s personality or the lore of a longtime locally legendary agent’s prowess precedes them and takes over the conversation. And this isn’t all bad: an agent with a super strong local reputation probably got it by dint of the very skills they’ll need to wield in selling your home, and highly social agents often have fantastic buyer broker relationships they use in getting the right target buyers into their listings (read: your home).

That said, if you are at the dining table with an agent, don’t let the conversation get so derailed that you fail to ask for and review the important data points.


You need to know a few key numbers, including:

  • The average number of days their most recent listings have stayed on the market before selling (and how that compares to the area average)
  • The average list price to sale price ratio they achieve for their listings (and how that compares to the area average)
  • How many listings your home would be competing with if you listed it today (and how they justify which homes they threw into that mix)
  • How many offers most home sellers in your area are fielding
  • How many other listings they currently have, and how many team members are available to service them.


Ask for this data and discuss with the agent candidate how it applies to the decisions you need to make: starting with your agent choice, but also including your pricing and timing decisions.


4. They fail to understand the data.
A lot of people who are super smart, Type A folks are so used to being highly competent that even when a listing agent candidate proactively presents data like that described above, they fail to ask questions about things they don’t understand. Let me tell you - if you don’t do real estate all day everyday, there’s no reason to expect that you’ll have mastery over this information at first glance.

If you don’t understand the data, the marketing plan or anything else the agent presents to you: ask. And keep asking until you do fully understand the information and it’s implications for you - even if you think you’re asking a silly question, you think it should be obvious. It’s a great way to make sure the relationship starts off on the right foot, and that you’re picking an agent who is happy and easy about breaking complex information down until you’re comfortable with it.


5. They don’t check references.
As with all of the often-omitted items on this list, listing agent candidates often provide references to potential Seller clients as a matter of course. But very few folks actually call and check them. Do. You can come up with a list of questions or just tell the reference contact a little about your situation and ask them to share something of their experience with the agent. Let’s be real – no agent is likely to give you references who are going to talk badly of them. But approaching your reference checks with the intent to have an open conversation about the past clients’ experience creates the opportunity for you to get all sorts of nuanced insights, rather than just a “good agent” or “bad agent” rating.

6. They don’t ask for a detailed marketing plan.
It’s essential to know precisely what steps your agent plans to take to market your home, before you hire them. What sites will your listing show up on? How many pictures will the listing include? What about Open Houses or marketing directly to buyer’s brokers? How do they propose to ensure that every qualified buyer who is on the hunt for a home like yours will see it?

Having a written marketing plan in hand (or in some digital format) empowers you to do things. If your home lags on the market, it’s a troubleshooting checklist that might surface what hasn’t happened or where an error might be glitching up your home’s marketing. And if you do the checklist and the home does appear to have been well and fully marketed, the plan can provide a strong proof point in favor of a price reduction.


7. They don’t discuss property preparation.
Different agents might have very different approaches to what needs to happen to your home before it goes onto the market. They might also have different approaches to how that work will get done. Some agents manage property preparation from soup to nuts, while others will give you some thoughts on what needs to happen and leave you to do it. Some will refer you to stagers and vendors, while others will bring people in on their own dime to actually execute their vision, and still others might even have access to home improvement contractors who will do some work now for payment after closing (this often depends on your price point and on what practices are standard in your market). Talk to every agent you interview, in detail, about what they envision will need to happen to your property before they list it, and how intensely involved they can and will be in helping you get the work done.

8. They don’t ask about Plans B, C and D.
The real estate market wouldn’t be the real estate market if it didn’t throw you curve balls. Some agents are strong at executing a cookie-cutter marketing plan so long as everything goes smoothly, but are not-so-great at problem solving when things don’t go as planned. Unfortunately, it’s tough to know that your agent lacks a backup plan until you actually need it! Ask your prospective agent candidates what complications, challenges and surprises they have encountered recently in their listing transactions and how they resolved a couple of them.

9. They don’t read the contract.
One of the most major freak-out moments I see happen with disgruntled Sellers (i.e., members of the club you’re trying not to join) arises when they are very upset with their listing agent and decide to cancel the relationship only to realize they’ve signed a contract locking them into it for 17 years. (I exaggerate, but you get the gist.) Similarly, some listing agreements have terms that mandate the Seller pay the agent’s commission if the Seller receives (but doesn’t accept) an offer meeting certain criteria or if the Seller finds the Buyer themselves.

The moral of the story? Read your listing agreement before signing it. Walk through it with your almost-agent, and don’t sign it until you understand your commitment.

By Tara-Nicholle Nelson

Terry Forsberg
License #: BR005041000
RE/MAX FINE PROPERTIES
21000 N Pima Rd Ste 100, Scottsdale, AZ 85255
Cell: (602) 410-9547
Business: (602) 410-9547
Email Us: terry@terryforsberg.com
www.terryforsberg.com

 
 

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4 Home Improvements That Don’t Pay Off

And four others that are better bargains

April 19, 2016

Backyard swimming pool

Credit: Getty Images

(This article appeared previously on NerdWallet.com.)

It’s nice to live in a home that’s designed just the way you like, even if you have to spend money on remodeling. But when it comes to increasing a home’s value, some pricey home improvements won’t come close to matching the amount of money you put in.

If you don’t plan on moving in the near future, recouping money may not be as important as knowing you’ll enjoy the remodeled space. But if your plan is to increase the value of your home, you may want to avoid projects that don’t offer a good return.

Here are four home improvements that usually don’t recoup costs, along with alternatives that offer a better bargain:

1. Bathroom Remodel

Add up the cost of a new tub, sink, toilet, tile and labor, and it’s easy to see how a major bathroom remodel can run close to $18,000, as reported by Remodeling magazine.

Instead of overhauling the entire bathroom, focus on smaller but highly visible upgrades, such as new sink fixtures and showerheads.

The finished product may resemble a luxury spa, but homeowners shouldn’t expect the value of their homes to increase by the full amount they spent on the upgrade. Homeowners typically recoup less than 66 percent in terms of increased value, according to the most recent Cost vs. Value Report from the magazine.

Better bargain: Instead of overhauling the entire bathroom, focus on smaller but highly visible upgrades, such as new sink fixtures and showerheads. Even if you don’t recoup 100 percent of the money you spend, at least you won’t be out thousands of dollars.

2. Room Addition

Building an extra room can set you back anywhere from $40,000 (to add a new bathroom) to more than $115,000 (for a master suite). You’ll gain square footage, but you probably won’t gain as much value when it comes to the selling price, especially if your home’s size before the addition was in line with other houses in your neighborhood. Most room additions recoup around 65% of their cost in terms of added home value, according to the report.

Better bargain: Hire an architect or interior designer to find ways to maximize your existing space. For example, you may be able to knock down some walls or eliminate a closet to get more usable space. These alternatives are usually much less costly than a room addition.

If those solutions don’t work and your family needs more space, it may be a good idea to sell your home and find a bigger one.

3. Major Kitchen Upgrade

A major kitchen remodel can include new appliances, flooring, custom lighting, countertops and an island. But the kind of features you see in dream home magazines are expensive. The average major kitchen remodel costs close to $60,000, and homeowners usually recoup only about 65 percent of that in added home value.

Better bargain: Consider a minor kitchen remodel. Instead of replacing entire cabinets, you could change the cabinet fronts and hardware. And instead of replacing countertops and appliances, you could add a fresh coat of paint on the walls for a new look.

A minor kitchen remodel is one of the best home improvements to recoup your money. The cost is usually less than half that of a major upgrade, but it returns about 83% of the value on average.

4. In-ground Swimming Pool

The cost to build an in-ground pool can top $20,000, though the price can go much higher if you want options such as heating, a concrete lining and an attached hot tub. Pools also require a lot of upkeep: cleaning, adding chemicals, changing filters and installing a cover in the off-season. So even after you pay off the installation, you’ll still spend time and money to maintain it.

The value a pool adds to a house varies widely by region, often running higher in warmer areas where people can enjoy pools year-round. But if there aren’t a lot of homes on your street with in-ground pools, don’t expect your home’s worth to skyrocket after you install one.

In some places, homeowners could recoup as little as 30 percent of the cost of installation. Some buyers may even see a pool as a negative, because it requires so much work to maintain and could be a safety issue.

Better bargain: If you want a water feature in your backyard, consider installing a small pond instead of a pool. An eco-friendly pond may blend better with its natural surroundings and require less upkeep. The typical price to install a small pond is $3,000, so it’s much less costly than a pool.

Completing certain remodeling projects can make your home look great, but you may not get your money’s worth when it comes to overall home value. To get the most value, consider skipping these four money-losing upgrades, and go for the better bargain home improvements instead.

What’s in store for the housing market this spring?

Eighty-eight percent of real estate professionals recently surveyed predict more first-time homebuyers in 2016 than 2015.

And 57 percent of those professionals believe spring 2016 will be busier in the industry than spring 2015, as more than half expect buyers to act more quickly so they can guarantee low rates. How can Realtors® prepare?

Most importantly, features in a home can make or break it. The highest percentage, more than three-quarters of those surveyed, cited an updated kitchen and bath as the most important feature. The second most-popular feature right now is an open floor plan, which 59 percent cited as vital.

Meanwhile, 43 percent said low maintenance features are important to homebuyers. More than one-third said homebuyers are looking for a walkable community, while one-fifth said the homes should be energy efficient to attract homebuyers. Finally, 19 percent said the strength of cell phone service or Wi-Fi is what consumers are looking for.

What don’t consumers want? Two-thirds said outdated floor plans are a deal breaker, while 63 percent said laminate countertops are a no-go. Does your client have popcorn ceilings? Fifty-nine percent said it’s time to upgrade to make the sale.

As for the expected uptick in homebuyers, 46 percent think it’s due to an improved housing market, and the same percentage cited more first-time homebuyers as responsible. Rising rents are leading more consumers to buy, said 36 percent, while 35 percent said more qualified buyers are in the market for a home. Finally, 31 percent said home price gains are leading to a better season in homebuying.

Kelly Leighton
April 20th

This is Where US Residents Are Moving in 2016

The fastest-growing counties, metro areas, and cities, plus more moving trends

By Matt Carmichael on March 24, 2016 at 11:00 am EST
 

 
Here’s what I found:

 

 

Here are my three big predictions in regards to the present and future trends in moving and relocation:

  1. While big cities might put states “on the map,” there’s certainly evidence that smaller, cheaper alternatives are proving a draw, even in places that are otherwise losing population—like Michigan, Minnesota and southern Ohio.
  2. The older, established metros like Chicago, New York, Los Angeles and others need to get their schools and finances together or they will see the current outward trends accelerate as Millennials age, have kids and need schools. Of course, educated Millennials aren’t the only ones leaving these areas, but they’re the ones who can most afford to choose their next destination.
  3. The South and West continue to attract movers, but the Northwest is a draw now as well – partially due to the high reputation for livability associated with those states, which is bringing in new businesses and residents alike.

How did I arrive that those conclusions? By taking a nice, deep dive into today’s release of population projections from the U.S. Census Bureau.

Any way you slice it, Texas is the big population winner for 2015. At the state level, it added more residents (490,000) than any other. Four of its metros added more than 412,000 people (that’s more than any other state-level total) between July 2014 and July 2015, according to data released today by the U.S. Census Bureau. The Houston area added about 159,000, while the Dallas-Fort Worth area added another 145,000. Adding 412,000 people is about the same as adding a city the size of Miami or Oakland. That’s a lot of people.

Overall, the nation’s 381 metro areas house about 275 million people. About 285 of them saw growth during that period.

Growth at the county level

Net growth is all well and good, but the pieces that make up that pie are interesting in themselves. Population change comes from a variety of sources. People are born, people die, people move in and people move out. Let’s spend a little time looking at the winners and losers at the county level, based on two of those that relate a lot to livability: people moving, and children being born.

 who's moving where

 
The fastest-growing counties (in terms of people moving in) are in the fastest-growing metros primarily in the South and the West (and Florida). These areas (Las Vegas, Phoenix, Dallas and Houston) have been gaining people left and right for years now. However, not all of Texas is winning people over. El Paso cracks the top 10 for counties losing residents.
Despite all that is written about the explosion of population and interest in our largest cities, four of the counties losing the most people are boroughs of New York City. Most cities reside in counties (some overlap county lines), but New York City is unique in that it’s so large that the city itself is made up of five counties, and four of them are bleeding people. The fifth, Richmond County (aka Staten Island), saw its population remain more or less unchanged.

Cook County Il., home of Chicago and its collar suburbs, had more than 50,000 people move out, and saw its first overall population decline since 2007. That’s like losing the population of Chicago neighbor Oak Park, Il. in one year. Los Angeles County lost even more to people moving out.


The Top 10 US Downtowns in 2016


Next, let’s turn to areas where people are being born

As we already mentioned, the growth of downtown urban centers faces one significant hurdle: their school systems. As Millennials age (and they’re turning 30 at a rate of 12,000 per day), their kids will eventually need schools. And urban school systems are in a disarray from coast to coast. So watching where people are being born, and where they move from there as they hit school age will tell us a lot about urban/suburban trends in the coming decades.

who's moving where

From these two tables we see that Los Angeles County has about two births for every death, a pretty good ratio for growth, until you factor in the number of people who moved away. This means that any growth from movers will be coming from international migration.

Harris County (Houston) Texas has an even better ratio – almost three births per death – and is adding people from domestic migration. That’s a great formula for growth.

Chicago’s Cook County? Not so much. The birth/death ratio is pretty tight and certainly not enough to overcome the drain of domestic emigration. Chicago’s suburban counties are losing people, too.

None of these trends are set in stone. Smart planning, sound fiscal management and investment in schools, and attention to quality of place are all important. Movers typically have a choice. If you want your city to grow and prosper, the key is making sure that your town floats to the top of the short list.

When "CBS This Morning" co-host Norah O'Donnell asked the chief executive of Zillow recently about the accuracy of the website's automated property value estimates — known as Zestimates — she touched on one of the most sensitive perception gaps in American real estate.

Zillow is the most popular online real estate information site, with 73 million unique visitors in December. Along with active listings of properties for sale, it also provides information on houses that are not on the market. You can enter the address or general location in a database of millions of homes and probably pull up key information — square footage, lot size, number of bedrooms and baths, photos, taxes — plus a Zestimate.

Shoppers, sellers and buyers routinely quote Zestimates to realty agents — and to one another — as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers' list price of $425,000. Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000.

HOT PROPERTY: Live vicariously on our celebrity homes report>>

Disparities like these are daily occurrences and, in the words of one realty agent who posted on the industry blog ActiveRain, they are "the bane of my existence." Consumers often take Zestimates "as gospel," said Tim Freund, an agent with Dilbeck Real Estate in Westlake Village. If either the buyer or the seller won't budge off Zillow's estimated value, he told me, "that will kill a deal."

Back to the question posed by O'Donnell: Are Zestimates accurate? And if they're off the mark, how far off? Zillow CEO Spencer Rascoff answered that they're "a good starting point" but that nationwide Zestimates have a "median error rate" of about 8%.

Whoa. That sounds high. On a $500,000 house, that would be a $40,000 disparity — a lot of money on the table — and could create problems. But here's something Rascoff was not asked about: Localized median error rates on Zestimates sometimes far exceed the national median, which raises the odds that sellers and buyers will have conflicts over pricing. Though it's not prominently featured on the website, at the bottom of Zillow's home page in small type is the word "Zestimates." This section provides helpful background information along with valuation error rates by state and county — some of which are stunners.

For example, in New York County — Manhattan — the median valuation error rate is 19.9%. In Brooklyn, it's 12.9%. In Somerset County, Md., the rate is an astounding 42%. In some rural counties in California, error rates range as high as 26%. In San Francisco it's 11.6%. With a median home value of $1,000,800 in San Francisco, according to Zillow estimates as of December, a median error rate at this level translates into a price disparity of $116,093.

Some real estate agents have done their own studies of accuracy levels of Zillow in their local markets.

Last July, Robert Earl, an agent with Choice Homes Team in the Charlottesville, Va., area, examined selling prices and Zestimates of all 21 homes sold that month in the nearby community of Lake Monticello. On 17 sales Zillow overestimated values, including two houses that sold for 61% below the Zestimate.

In Carlsbad, Calif., Jeff Dowler, an agent with Solutions Real Estate, did a similar analysis on sales in two ZIP Codes. He found that Zestimates came in below the selling price 70% of the time, with disparities ranging as high as $70,000. In 25% of the sales, Zestimates were higher than the contract price. In 95% of the cases, he said, "Zestimates were wrong. That does not inspire a lot of confidence, at least not for me." In a second ZIP Code, Dowler found that 100% of Zestimates were inaccurate and that disparities were as large as $190,000.

So what do you do now that you've got the scoop on Zestimate accuracy? Most important, take Rascoff's advice: Look at them as no more than starting points in pricing discussions with the real authorities on local real estate values — experienced agents and appraisers. Zestimates are hardly gospel — often far from it.

kenharney@earthlink.net

Distributed by Washington Post Writers Group.

Real Estate Advisor: December 2015

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When to Use a Professional

As homeowners, we want our properties to reflect our styles and the designs of the current day. If you have purchased an older property, or you just want to update your current home, a certain degree of work and projects are required to bring your property up to the level you strive for. While many of us have experience with home projects, there are some of us that don't. Below are some of the common projects homeowners embark upon, and suggestions on when it's best to do it yourself or call a professional for help.

Walls

Most painting jobs are DIY, pending you have a steady hand. Should you have structural repairs or water damage, call a pro, especially if you're going to demolish the existing wall, replace or re-frame anything, install new Sheetrock or drywall or anything else that is labor intensive.

Floors

Floor repairs can be fairly easy, from cleaning to repairing small nicks in the flooring. If you want to take on a larger project, it might be worthwhile to hire a pro if your project requires installing hardwood floors or laying tile. With the amount of work required to install a new floor, hiring someone with the experience can save you time, money and a lot of body aches.

Windows

If you're doing minor maintenance and repairs (like repairing or replacing wood sills or caulking around windows), you should be able to do this type of project no sweat. But if you're looking to replace a window, or need to rebuild a window frame, count on calling a professional for help.

Electrical

If you have no experience with the electrical system of your home, keep your improvements limited to changing outlet covers and switch plates. You can also change all your current light bulbs to energy saving bulbs.

Tile

Tiling a back splash or replacing dirty old grout are projects most homeowners will be able to tackle on their own. But if your project requires tiling floors, walls, or large tile installations, it might be worthwhile to contact a professional for help, especially if your project requires cutting any tile.

Plumbing

DIYers should be able to do small projects, like replacing a toilet flapper, addressing drips, upgrading shower and sink fixtures, and other small things that don't require a lot of tools. If your project requires moving or installing any plumbing or pipes, call a pro for help.

Home Repairs for a Professional:

Plumbing

Small leaks can mean thousands in repairs if they're not caught in time. If you need to modify your plumbing system, then you should definitely call a professional. Welding pipes together requires a torch, and if you don't have that experience, it's best to rely on the experts for this type of work.

Electrical

If your project requires direct contact with electricity, call a pro. This includes rewiring, adding power to areas that do not currently have power, and any installation of large or heavy light fixtures (think a chandelier). Electricity is no joke, and the last thing you want is to cause yourself harm, or harm your home, during a DIY project.

Asbestos, Mold and Lead Paint

If you have a new home, you will not encounter asbestos or lead paint. But if you are interested in older homes, asbestos and lead paint are a possibility. Once used as insulation, asbestos is toxic, and there are laws that govern how it's removed and disposed of. Lead paint is also highly toxic, and removal should be done by a lead professional. Should you have mold in your home (certain types are toxic), it's best to leave the removal of all of these to the professionals: they know how to remove and dispose of all toxic materials, and they can do it safely.

Roofing

Repairing a roof shingle might seem like an easy task, but there is more danger in getting on and off a roof than most homeowners realize. Tools, multiple trips up and down a ladder, and constant attention paid to the incline of the roof make roof repairs tiring, and if you're not prepared, dangerous. Stick with the professionals – they have the proper gear and the experience required to do the job right.

Anything with Gas

Gas is similar to water: if it can find a way out, it will escape. If you're replacing appliances that run on natural gas, it's best to hire someone to help with installation. The last thing you want is for gas to escape and result in a buildup of carbon monoxide in your home.

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Real Estate Advisor: November 2015

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You Can Buy and Sell Real Estate During the Holidays

It's common knowledge that most people are advised to get their home on the real estate market in late spring or early summer as that is 'real estate season.' While the majority of homes do sell in the spring and summer, listing your home or looking for a home during the holidays or in the winter is not as taboo as some would lead you to believe. There are actual benefits to listing or looking for a home during the holidays, and if you've missed out on the real estate scramble of the spring and summer, starting a home search or listing your home now might just be in your best interest. Here are some of the top reasons why you shouldn't avoid listing your home, or looking for a home, during the holidays.

Buyers Never Stop Looking

Many would lead you to believe that the real estate market comes to a complete stand still during the holidays or in the winter, but that's not the case. Every state's real estate market is thriving year-round, and that even includes during the holiday season. Serious buyers never stop looking, and a serious seller (or a seller that wants or needs to sell their property) will keep their home or property on the market all year long. The holidays bring out the buyers and sellers that are determined -- they need something or want to sell now, and they're not willing to wait for the spring or summer.

Many people with school-age children want to wait to buy a new home when their kids are not in school, but the reality is that a family or anyone looking for a new home can move at any time of the year. Perhaps if you're in an area with inclement winter weather, you might want to put off your search or move until better weather arrives, but for those that live in a mild climate, moving in November or December is just as easy as moving in May or June. Buyers can also sign up for new listing emails, which alert them to whenever a new property has come on the market, and sellers have the ability to sign up for sellers reports, so they can stay on top of the market in their neighborhood.

Inventory and Competition

While it is known that home inventory is largest during the spring and summer months, the MLS always has homes and properties listed on it. Fall and winter will have properties available, but the number of properties will be lower. Unless you're totally transfixed on a certain home, or you have a list of needs and wants a mile long, you can be sure to find a property that will fit your housing needs throughout the year.

Despite the fact that inventory will be lower in the fall and winter, people still list their homes, especially if they are serious sellers. While the market is slower, it also is less competitive in terms of other buyers looking for homes. It's likely the fall and winter won't create scenarios of multiple, high dollar offers on one property; buyers and sellers alike will have more opportunities to actually think about offers, and especially for buyers, low competition guarantees that you're not making a rushed or rash decision based on emotions or other offers when you do find the perfect property.

Affordability

This is specifically for buyers, but it's widely known that home prices slightly fall in the fall and winter when the market has cooled down and more serious sellers are keen to get a sale. This is mostly because real estate sales are seasonal. But that's not to say if you list your home in the fall or winter you're going to have to drastically slash the price in order for your property to sell. While it might sit on the market a little longer than it would in the spring or summer, fall and winter sales happen, and if you're a serious buyer or seller, you know you'll want to do all you can to make your dream of buying or selling a home a reality.

Homes Look and Feel Charming

You'll see a lot of articles on how to spruce up a home to ready it for the real estate market, and while the tips are definitely valuable, it's not a secret that many people decorate their homes over the holidays. There's something warm and inviting about a decorated home, or a home that feels cozy, and people who list their homes in the fall and winter can take advantage of a fireplace or wood stove to make a room more inviting.

If your property doesn't have a fireplace or wood stove, you can use candles and other things to make the home smell inviting to buyers. While it may seem cumbersome to sell a property during the holidays or in the winter, you do have some ways to play up the season. And if you are truly set on avoiding the holidays, you can always put it on the market the first of January, when the chaos of the holidays is over.

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Real Estate Advisor: August 2015

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The Hidden Costs of Homeownership

If you've never owned your own property before, there are some costs you should prepare yourself for ahead of time. Should you take out a mortgage, you'll have your monthly mortgage payment, but often there are additional costs and fees added that a new homeowner will not expect. Listed below are items you should expect to pay once you become a homeowner.

Property Taxes

When you rent, you are not responsible for the property taxes on the property. But when you become a homeowner, you're expected to pay yearly property taxes, of which go to public works, wages for government workers or public school boards. Based on the current value of your home, property taxes are assessed every year and will likely change to reflect an increase (or decrease) in your home's value. Property taxes can be paid at one time, or they can be divided into 12 payments over the course of a year and added to your mortgage payment. When you're trying to determine what your mortgage payment will be each month, don't forget to factor in property taxes.

Home Maintenance

When you live in a rental property, most maintenance is performed by the landlord or a property manager. When you become a homeowner, those maintenance costs fall upon you. When you purchase a home, all maintenance items should be considered when it comes to your overall budget. Will you want to replace all the appliances? Will the property need new windows or a new roof? Does the home need basic upgrades? Most people in the industry suggest you allocate 1% of your home's worth for maintenance costs every year, but the reality is that 1% is likely the minimum – you should plan on more than 1% maintenance costs each year as a homeowner, and if you plan on any larger renovations, bet on the costs to be even higher.

Mortgage Insurance

Most people, when they buy a home or property, are able to do so by taking out a mortgage loan. If you put less than 20% of the cost of your property down, you're required to have Private Mortgage Insurance (PMI). PMI protects lenders if the borrower defaults on their loan. PMI is charged annually, and it will typically cost 0.5% to 1% of the entire loan amount. The payments are generally paid each month rather than in a large one-time payment. If you plan on taking out a mortgage loan, and you don't have 20% to put down, expect to add private mortgage insurance payments to your other monthly bills.

Supplemental Insurance

Do you live in an area prone to natural disaster? As a homeowner you'll need to have regular home insurance to protect your home or property from typical things (plumbing issues, roof leaks, etc.) that homeowners encounter. Should you live in an area that's prone to weather-related issues (floods, tornadoes, earthquakes, hurricanes) you will want to purchase supplemental insurance to make sure your home is covered should nature decide to show herself.

Landscaping and Lawn Care

When you rent a condo or an apartment, it's highly likely you are not spending a lot of time outside in a yard. When you buy your own property (should it have a yard or some kind of outdoor area), expect some hidden costs to come in the form of lawn care. Does the yard need some major landscaping? Are you going to mow it yourself, or will you hire a company to do it? Do you have a lawn mower, rakes, snow or leaf blower, yard tools, shed, and any other items needed to keep your yard looking great year-round? A yard comes with extra costs, so be sure to know how much you want to spend on upkeep per year.

HOA Fees

If you've been renting your previous residence, it's likely you haven't had to pay Homeowners Association (HOA) fees for your apartment or rental. Should you buy a house, condo or townhouse in a neighborhood with common areas, a clubhouse, pool, or any other kind of community meeting places, it's likely you'll move into a neighborhood with an HOA. HOA fees can vary in terms of what the HOA covers within the community, but unless you know through your Realtor or through the homeowner the monthly fee, you can expect to spend anywhere from $10 to hundreds of dollars per month on HOA fees.

Buying your first home or property is a huge step in anyone's life. Before you start your property search, make sure you consider all of the items above when you're thinking of buying a home or property and during your property search.

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Terry S. Forsberg
, PLLC, Associate Broker

RE/MAX Fine Properties

602-410-9547 Mobile

Certified Residential Specialist, CRS

Arizona CRS Chapter Past President

www.TerryForsberg.com
www.facebook.com/RealEstateArizona

Terry Forsberg, RE/MAX Southwest, RE/MAX FINE PROPERTIES, 21000 N Pima Rd Ste 100, Scottsdale 85255

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Real Estate Advisor: August 2015

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Why It's a Smart Move to Use a Real Estate Agent

Buying or selling a home seems to be a way of life for a lot of people in today's world. When you buy, you definitely want to get the most for your money. Many people think they can go it alone when it comes to buying or selling a house, and it's definitely true that some people are able to handle all the details of buying and selling a home or property, but in reality the real estate process is intricate and requires a lot of knowledge about the local real estate market, contracts, escrow, appraisals and referrals. While some home owners and buyers are in a position to go it alone, for those intimidated by the market or those who don't have the time or energy to sell or buy a home on their own, here are some reasons why it's a smart move to use a real estate agent during your next real estate transaction.

Local Expertise

You've lived in an area for some time – but while you may know about local amenities and activities, do you have a lot of knowledge on the local real estate market? Real estate agents know their markets: they know how much homes are selling for, they know what areas are highly desirable and they know which ones are up-and-coming. You can trust an agent to know the local inventory and know how to get the best price for a home or property.

Access

Real estate agents have a number of access points that a regular buyer or seller doesn't. They have access to listings before they are put in the MLS, and they have access to the homes! Many sellers are only willing to grant access to agents, which means that most buyers going it alone can only access homes during open houses. An agent working for the seller is only going to provide information with the seller's best interest at heart, so when you go it alone you might be only getting partial information from any questions you may have. Working with an agent will help provide private access to homes, and an agent will be able to get more information from the seller's agent.

Experience

Buying a home is an intimidating experience – you're making one of the biggest financial decisions of your life. As a buyer, you want to make sure stress and emotions don't get the better of you, especially when it comes to making important decisions. Real estate agents know what buyers and sellers go through – they've been there, as it's more than likely they too have made a real estate purchase of their own. While they have personal experience, they also have an experienced rational eye when it comes to the business portion of a real estate transaction. They possess clear judgement, and agents are a seller and buyer's biggest advocate for a successful negotiation. Real estate agents have the experience, knowledge and acumen to make the process as smooth and stress-free as possible.

Connections

The real estate transaction process requires a number of professionals and services. From a lender, home inspector, contractors and handymen for repairs, lawyers, and a number of other professionals and tradesmen, knowing the right people is beyond important when you want to have a smooth and successful transaction. Real estate agents are in the business, and their past experience has provided them with a number of respectable and dependable contacts and referrals than you'll find asking friends and family. A ready agent will come prepared with connections and people they are willing to refer because they've worked with them in the past and they know their track record. When you choose to work without an agent, you sacrifice the networking that naturally comes with being a real estate agent.

No Cost When Buying

If you're searching for a home or property to buy, having an agent is free. An agent's commission is paid by the seller, but most buyers don't realize this and entertain the idea of going without a Realtor during their home search. If a seller pays the commission, there is no loss to a buyer to take full advantage of all the services a real estate agent offers. It's also important to understand that even if you choose to go it alone when buying a home, you do not receive the commission a buyer's agent would. Commission rates are negotiated before the final sale and are included in the contract, meaning if you don't use a buyer's agent, the entire commission is paid to the listing agent.

Documents and Paperwork

Unless you're working with a brand new agent, most agents know the ins and outs of all the documents and paperwork required for a home sale or purchase because they've been through a number of transactions. From finding the comps of your market and drafting a purchase agreement, to contacting any other agents and the title company, a real estate agent will be able to provide help in the forms of knowledge, time and resources during the real estate transaction process. Agents also know the important parts of an offer or contract, especially when it comes to line items that could cost a lot in the end or things that are negotiable. Having an agent that knows the process, the paperwork and the documentation is a valuable asset when it comes to making one of the biggest decisions of your life.

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Real Estate Advisor: August 2015

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Fast and Easy Updates to Help a Home Sell

We are smack dab in the middle of home buying season, and while some properties are off the market before they're even on it, others haven't had such luck. A great way to boost your home's selling power is to make small and affordable updates throughout the home. These quick updates and fixes won't break the bank or a budget, and they will help make your home more inviting to potential buyers and a potential sale.

Spruce Up the Front Door

The front door is one of the first things potential buyers see when viewing your home. Spruce up the front door by touching up paint (either paint over chipped or fading paint, or change the color completely), adding a kick plate, changing out the hardware, or you can replace the door completely. A new front door can add energy efficiency and additional security if you choose a metal door. Making the front door pop not only adds a special touch to your curb appeal, but potential buyers definitely notice a door that's been taken care of.

Freshen Up the Kitchen

Kitchens appeal to so many buyers. If you don't have the budget or time to overhaul your kitchen, don't panic. If you have nice wood cabinets and don't have the budget to update them, consider adding a coat of paint to freshen them up. You can also add new hardware (knobs, handles or pulls) to help give cabinets a younger look. You can also change out any outdated countertops, and adding a new faucet to the sink is another way to give a kitchen a new vibe. If you have the time and the budget, consider changing any flooring that is chipped, cracked or broken. Vinyl flooring is economical and affordable, and it's available in a number of types and styles to suit any kitchen design.

Update Porch Columns

Porch columns are another item buyers see immediately; if you have columns that have chipped paint, are decaying, or don't match the style of the home, consider updating or replacing them completely. Sand and paint over chips, or update the look with vinyl wraps. If you have the budget to replace the columns, consider fiberglass, which is weather resistant and helps support the weight of the porch roof.

Tidy Up a Bathroom

Bathrooms are another large selling feature of properties, and outdated bathrooms are a top sale killer. Update within reason of your budget and time: replacing the vanity, counter, sink and faucet can be a quick fix that is also budget friendly (some home improvement stores have entire kits available for this). If this doesn't fit your budget, consider painting the vanity and replacing the hardware and faucet. Other updates that can be done in the bathroom: change out a toilet (you can usually find energy efficient toilets at a local big box store for under $200), update a showerhead, and replace any vanity or overhead lighting for more modern and energy efficient options.

Update a Staircase

Many staircases are located just as you enter a home, which means they are a focal point and something buyers look at and judge the moment they walk into a property. If your staircase has seen better days, take the time to do some small updates. Fix any broken or loose steps and evaluate the railing; refinish a wood staircase, replace a broken railing, change outdated balusters, and, if the stairs are carpeted, clean or replace the carpet.

Jazz Up a Fireplace

Whether it's gas or wood, many homes have fireplaces, and many buyers love them for their purpose and as focal points. An updated fireplace can say loads about your home, and a great looking fireplace can help a sale. You can paint and transform outdated brick or add ceramic tiles to add color. You also have the option of adding budget-friendly artificial stone veneer or natural stone (if you have the time and money). Mantels are a large part of fireplaces – add, update or replace a mantel with wood, stone or marble. An updated fireplace and mantel can help any home sale.

Light Up the Yard

Lighting can take the exterior of a home from drab to fab. Dark homes don't pop to buyers, and outdoor lighting can add a ton of appeal. Update any outdated outdoor lighting fixtures, especially those that no longer work or are broken. If you have some extra money to put toward projects, consider adding additional outdoor lighting in the way of a lamppost or path lights, and if you live in a sunny climate you also have the option of solar lights.

Organize a Closet

Buyers will go through cupboards and closets, and a cramped bedroom closet can be an issue with some buyers. A quick and budget-friendly fix is a closet organizer. Organizers come in a variety of options, from wood and plastic-laminate to wire, and most are DIY, which cuts down any installation costs. If your closets are stuffed or poorly organized, buyers will see this and could potentially be turned off by it.

Make an Attic More Usable

Most homes have some kind of attic, whether it be a small crawlspace that's barely accessible or a large attic area accessed by a staircase. Make sure your attic area is accessible: if it's not, add a ladder and insulate the door for better energy efficiency. If your attic area is just studs, add a plywood floor to make it more accessible and ready for storage. By adding a couple extra things to an attic area, you're adding usable space and making your home more marketable to potential buyers.

These fixes are relatively easy, and most shouldn't break the bank. If you can afford to do some, go for it, but do what is in reason of your time and budget. You want to sell your house, and you don't want to spend a fortune updating it. Small fixes can be the ticket to a quick sell, or they can help a home that's been sitting for a while finally get some movement.

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Real Estate Advisor: July 2015

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Barbecue and Fire Pit Safety for the Summer

Throughout the United States, the summer months are those months where millions of Americans find themselves enjoying the outdoors or chilling in the backyard. With summer comes barbecues and evenings outside, sitting beside the fire pit. It's important to remember that barbecues and fire pits require a certain amount of safety when in use. To help you in your summer celebrations, keep these safety tips close by when using a barbecue or fire pit this summer.

Barbecue Tips

Grilled food is a true treat, especially when you don't want to cook inside during the warm summer months. Grills should always be used outside, in a well ventilated area. To ensure safety, grills should be stationed away from the home, deck railings and away from any low hanging tree branches or plants.

The most important thing to remember is to never leave the grill unattended, especially if you have children and pets. The second most important safety item is to remember to keep the grill clean by removing grease and fat buildup. You can also clean or replace any trays that sit below the grill and collect food waste, oil and other grill debris.

Propane Tips

Propane can be found in both liquid and gas form. Naturally odorless, an additive is added to the gas to give it a distinct odor to help people identify when the gas is around. Propane, when stored under pressure, is a liquid. When you hook up a propane tank to a gas grill, the tank is opened which allows propane gas to leave the tank and power the grill. Liquid Propane is very cold, so cold that it can cause freeze burns if it comes into contact with skin.

Storing propane is an important part of propane use. A propane tank should always be stored and transported upright, and proper propane storage requires the tank be in a temperature controlled area. If you store a propane tank in an area that's susceptible to high temperatures, there is a risk of the pressure release valve opening and releasing gas, which is a fire hazard.

When transporting propane, make sure the pressure release valve is closed and that there is cap or plug over the valve outlet. Tanks should always be transported in an upright position, sitting on the tank's foot. During transport, the tank should be secured, even if it's empty. You can secure the tank with a safety strap, the seat belt, or some kind of other container to prevent the tank from tipping over.

It's important to remember not to transport more than four propane tanks inside an enclosed vehicle at one time. You can carry more than four if you are transporting the tanks in the bed of a truck and they are secured to prevent escape.

Fire Pit Tips

Sitting beside a fire pit, enjoying a drink, roasting marshmallows, or just listening to the crackle of the wood can be some of the most enjoyable and memorable moments of the summer. Fire pits are a great outdoor accessory, but they do require an amount of safety to operate. A fire pit should be at least 10 feet away from any structure or combustible surface. Unless the owner's manual says it's ok, do not put a fire pit on grass, a wood deck or in an enclosed deck/porch.

When it comes time to light the fire, be sure to always burn dry, seasoned wood that was cut at least six months earlier. In order to prevent sparks, keeps logs no longer than three-quarters of the pit's diameter. When starting the fire, don't use gasoline, lighter fluid or kerosene as these are not meant for fire pits! Use a fire starter or newspaper and kindling.

Do not light a fire in windy conditions, and it's important to remember to stay up-to-date with burn bans or burn ordinances in your area. If the pit is located in an area near trees or bushes, pick up any leaves or combustible material from around the pit before starting your fire. Keep a bucket of sand, a fire extinguisher or a garden hose nearby in case things get out of control.

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Real Estate Advisor: June 2015

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Budget Friendly Curb Appeal Ideas Done in a Day

88 percent of homebuyers begin the process online, looking at pictures on the listing site. Good photos and real curb appeal help entice buyers to check out your house in person. You want to make a great first impression, so don't feel scared to make a statement -- you want buyers to fall in love with your house. The fixes below are minor and budget friendly enhancements that can be done in a day to help make your house more inviting and appealing, and help get potential buyers to schedule a showing!

Glam the Front Door

The entry is a huge focal point for potential buyers, especially when it's one of the first things they see. Create appeal by cleaning the front door -- wipe it down, remove dirt, update the color with some paint. The front door should play off a home's interior: add a kick plate, swag or a seasonal wreath to reflect the interior style of the house.

Create Symmetry

It is known that humans find symmetry beautiful – symmetry is attractive to the human eye, especially in nature. Symmetry is also appreciated in the design world for its familiarity, balance and it works with every style. Using symmetry to entice potential buyers is a quick and cost-friendly tool to the home seller: compose light fixtures, plants and front-door accents based on symmetry to create welcoming and inviting entryways and boost the house's curb appeal.

Makeover the Mailbox

If you have a mailbox, it can be a great way to accent your house and add a little touch of personality. If you're going to replace the box, pick one that mimics the style and trim of the house. You also have the option of dressing up a mail box by painting the post to match the house's exterior color, or you can surround it with flowers or other plants.

Add Outdoor Lighting

A quick, easy, and budget friendly way of adding appeal to the outside of your house is to add outdoor lighting. Outdoor lighting adds a little something extra, and it can also provide safety and security. Homeowners have many options for lighting, from wired to solar, and lights can be purchased at many retailers and hardware stores. Install landscape lighting along paths and trees.

Patch Up the Grass

Pets, animals, weather and other events at your house can take a toll on your yard's grass, and most buyers will notice a lawn that looks like it's on its last leg. Cut out any dead spots and replace with sod, or, if you have time, replant with seed. If you live in a non-drought area, turn on the sprinklers: a lawn needs at least 1" to 1 ½" of water per week and should be watered deeply 2-3 times per week.

Install Window Boxes

Window boxes can be a really budget friendly way to liven up the outside of a house. They help play up windows, and they can add a pop of color by way of plants or flowers. For a traditional look, choose boxes made of copper or iron, and pick painted wood for more of a cottage feel. Use a window box to play with flowers that will suit the lighting in the yard and the color scheme of the outside.

Renew Planters and Beds

Poorly maintained planters and flower beds can be a big letdown to potential buyers – especially when many view poor upkeep as an indication of what a house may look like inside. Be sure to prune overgrowth, pull weeds, plant extra flowers and add new mulch to restore life and color depleted by the sun and harsh weather. Adding a border around flower beds or along paths can be a great addition, and budget friendly. If your yard already has a border, clean and restore pieces that are worn or upgrade the stone altogether.

Another budget friendly fix you can do in less than a day is pressure washing any dirty siding, decks, patios, driveway or sidewalks. A pressure washer can be rented at any home improvement store for a small amount, and freshly washed pavement and siding can help make a home look revitalized. If you're limited on outdoor space or have no yard, add some color by creating a container garden. These small gardens are easy to maintain and can easily be transported to your new residence once the sale is finalized. As a seller your top priority is getting the most out of your house -- concentrating on small and easy fixes that are budget friendly can really help give your house that pop so many buyers look for.

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 Real Estate Advisor: May 2015

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Prepping Your Home for a Vacation

Vacations are a time to relax and escape from regular life. When you're miles from home, the last thing you want to worry about is the safety of your home. If you plan on taking a vacation this summer (or any time this year), here are some simple tips on prepping your home for a vacation.

Stop Your Newspaper and Mail

One sure sign of being absent from your home is a pile of newspapers in the driveway. Contact your newspaper delivery person and stop service while you're gone. If you don't have a locked mailbox, contact the post office and have them hold your mail. You can also ask a trusted neighbor to collect mail, newspapers and deliveries and have him/her hold them for you until you're back.

Park Your Car in the Garage

The last thing you want is to get home from a vacation and have your car gone. If you can, park your car inside the garage, or have a family member park it at his/her house. You can also ask a neighbor to park their car in your driveway, making it look like someone is leaving each morning.

Put a Light on a Timer

A dark house stands out in a neighborhood, especially when all the other homes are lit up. Before you leave, buy a timer and install it on a lamp in your home. It's also a good idea to install a motion-activated sensor on an outdoor floodlight that will be triggered should someone walk by it. You can also ask a neighbor to turn on the front porch light in the evening.

Mow Your Lawn

Grass can grow pretty fast in two or three days. If you have a lawn, make sure it's trimmed before you embark on your trip. If you're going to be gone longer than a week, ask a family member or neighbor to cut the grass in the front yard while you're away.

Some of these items are easily overlooked, but could cause major issues when you're away:

Unplug Small Appliances and Electronics

Small appliances and electronics can be energy vampires when plugged in, and some are still active even when they look like they're turned off. Before you leave, unplug those items that won't be used while you're gone (coffee makers, toasters, espresso machines, etc.). It's also a good time to make sure all smoke detectors work properly throughout your home.

Turn Down the Thermostat

Your thermostat makes sure your home maintains a specific temperature throughout the day. Before you leave, set the thermostat to a lower temperature if the house is going to be empty. This will help conserve energy while you're gone. If you do turn down the thermostat, be sure to keep your home at a temperature that will still protect plants, pets and furniture.

Put the Water Heater in Vacation Mode

Traditional water heaters heat water throughout the day, even when you're not using water. Before you head out on a vacation, put the heater in vacation mode. Check to see if your water heater has a VAC setting -- which is for vacations. If it doesn't, you can turn down the thermostat to the lowest setting. But don't stop at the water heater: turn off water valves to the dishwasher, washing machine and any sinks. The last thing you want to come home to is a flood in your house because a pipe broke or a hose burst.

Tidy Up the Kitchen

Before you leave it's always a good idea to clean out the fridge and dispose of anything that will go bad while you're gone. The sink can harbor things that cause bad smells -- run a half cup of vinegar and some water through the garbage disposal to alleviate any potential buildups, and make sure to take out any trash and recycling so you don't come home to a smelly house. If you have a trusted neighbor, ask them to put your garbage, recycling or yard debris bins out on pickup day.

Leave Emergency Contact Info with Neighbors

You may tell your family that you're heading out, but you should also let a neighbor know. Neighbors live near you and can be your first point of contact should something happen to your home while you're away. Let a trusted neighbor know you're going to be out of town -- provide them with information on where you're going, how long you'll be gone, and contact information for yourself and for family members in case of an emergency.

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Real Estate Advisor: April 2015

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Staging Tips for Sellers

Spring has arrived, which means real estate season is upon us. When selling your home or property, attracting full price offers is always top priority, and a properly staged home can be your number one asset in drawing as many offers as possible. Here are staging tips to help you prepare your home for the market.

Enhance Your Entry

It's the first thing buyers see, and most likely serves as the first impression of your house. Utilize the entry by updating the front door color, change out the door hardware (or clean and polish the current hardware). Make potential buyers welcome with a nice mat and some potted plants or flowers.

Clean Out Clutter

The majority of us have too much stuff, and clutter is a huge killer for potential buyers. Be ruthless when it comes to clutter -- if you haven't used it in three months, box it up. If you haven't used it in a year, sell or donate it. Go one room at a time. It's ok to have empty space. If you can't part with something, get creative on how to store it. Rolling bins that fit under beds are perfect for hiding items and getting things out of the way. Too much furniture will also make a home look cluttered and smaller than it is. You want to create space – ask what you can live without. Every square foot is prime real estate.

Move or Float Furniture

Once you've moved out the clutter, turn to the remaining furniture. Furniture doesn't need to be pushed up against walls. Moving and floating pieces can help rooms look and feel bigger. Try moving pieces around, even from other rooms, but remember to keep the perimeters clear with clear pathways.

Let the Light In

Natural light does wonders for a home and makes rooms more inviting. Take down heavy drapery and replace with gauzy and airy fabrics. If you have views, play them up! Look into roman shades, which help with privacy but also let light in. Simple curtain panels made from airy fabrics like cotton twill or translucent linen will let the light in during the day and still help with privacy at night.

Re-purpose Rooms

Do you have a designated junk room? Re-purpose rooms that have lost their identity. Most designers look at junk rooms and envision fantasy spaces: an exercise room, meditation space, art studio, etc.. Re-purpose a clutter/junk room into something that will add value to the house. Also consider loft spaces, stairwell nooks and other areas not utilized or gathering dust as possible areas for increased space.

Light It Up

Many homes are poorly lit, making rooms too dim or harsh on the eyes which can deter buyers when they walk into your house. Try to aim for a total of 100 watts for every 50 square feet. Don't be afraid of dimmers, and replace light-switch covers that are old, dingy or broken. Uplights also help add depth to a room, especially when positioned behind a plant or piece of furniture.

Add Some Color

Color on the walls or as an accent can really make a room pop. Painting is an inexpensive and easy way to give your house a new look. Neutral colors don't mean beige or off-white; warm tans, honey and soft blue-greens all attract the eye and help to make a room feel warmer without going overboard. Accent walls can also add a burst of color. If painting is too daunting, add richly colored accessories, pillows and throws for subtle bursts of color.

Add Art and Accessories

De-cluttering is important, but so is playing up what you have in your house. Adding art to a drab wall can also add character to a room. Try breaking up the art by patterning and grouping pictures or images together. Add a small touch by accessorizing your room -- layer accessories in threes, with varied heights and widths. The eye naturally reads a room from left to right, so adding a large or striking object in the far right corner will draw the eye to it and make the room seem bigger. Another accessory not to be overlooked: plants. A vase of fresh flowers, branches, twigs or greenery will add depth and character to a room.

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Real Estate Advisor: March 2015
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Common Pests and Your Home

The list of new responsibilities can seem overwhelming when you buy a home or become a first-time homeowner. One responsibility that tends to get overlooked until it becomes a larger issue is that of household pests. A household pest is "a destructive insect or other animal that attacks" your home. Pests range throughout the U.S., but the most common pests are those that have become almost commonplace in our lives. Here are some of the most common pests encountered by homeowners throughout the U.S., and what you can do to help prevent pests in your home.

Most common Spring and Summer Pests:

Termites:

Termites are generally grouped by their nesting and feeding habits: subterranean, soil-dwelling, dry wood, damp wood and grass-feeding. They feed on dead plant material, generally in the form of wood, leaves, soil and animal dung. Termites can cause significant structural damage to buildings. Those classified as subterranean and dry wood are those that are responsible for the damage to homes.

Ants:

Ants are the most common household pests in the north central states. They are social insects, and they have a wide variety of nesting habits. Ants can build nests in soil, behind moldings, baseboards and counter tops, and some types nest in decaying or moisture damaged wood. Ants will feed on all types of food, and ant damage varies. Most ants cause little damage, but carpenter ants can weaken wood structures similar to termites, and the majority of ants don't transmit diseases.

Flies:

Flies are some of the most annoying pests in the home. They land on almost every surface, and their diet includes a wide variety of foods: human food, animal food, animal carcasses, garbage and excrement. Flies also carry germs and diseases. They are known to transfer over 100 pathogens, some of which include salmonella, anthrax, tuberculosis, and the eggs of parasitic worms.

Spiders:

Spiders are generally not harmful and they do feed on other insects like flies and other spiders. Most spiders found in the home are not venomous, but there are some that homeowners don't want to find inside their house. The Black Widow and Brown Recluse are two of the most talked about spiders homeowners do not want to find in their homes. Black Widows can be found throughout the U.S., and Brown Recluse are predominately found in the Midwestern States, most notably Oklahoma, Arkansas and Missouri. All spiders have the ability to travel to all states by ways of hiding in boxes, packages and produce.

Most Common Fall and Winter Pests:

Stink Bugs:

Stink bugs are found throughout the U.S., and most of the time homeowners don't know they have an issue until early fall, when stink bugs turn up on the sunny side of homes where they can warm themselves. During the summer months stink bugs live outside, feeding on fruits, grains and other crops. During the colder months, stink bugs will hide inside walls or in attics and crawl spaces. These bugs get their name from the unpleasant odor they produce when they feel threatened.

Rodents:

Rodents are warm-blooded and are found throughout the U.S. The most common types of rodents are mice and rats. Both rapidly breed and are capable of squeezing through spaces that appear smaller than their bodies. Rodents seek warm shelter in the cold months, particularly mice, who seek food, water and warmth within homes. Generally, if one rodent is found, many more are hiding nearby.

How to Avoid Pests:

Most home pests can be avoided by doing simple, everyday things. As a homeowner, make sure your doors and windows are closed, as these are the most common ways for pests to enter a home. Make sure window and door screens are in good repair or working order. By eliminating moisture buildup in small areas and basements you reduce the risk of creating hospitable environments for pests. Sealing openings in a home's foundation will help reduce access to your home.

Trees harbor pests -- by keeping tree branches trimmed and away from the home you deter pests (especially spiders) from having easy access to your home's roof. Moisture attracts pests -- direct rain water away from the home and foundation to prevent possible moisture buildup. If you have fire wood, store it at least 20 feet away from the house. Flies and other pests are attracted to garbage, so ensuring that garbage cans are sealed tight and all animal deposits are picked up will help reduce the risks of attracting pests into your home. The best deterrent to pests remains a clean, uncluttered home, where food, crumbs, and anything else that has the potential to attract pests is put away, covered or thrown away.

 


Terry S. Forsberg, PLLC Associate Broker,

CRS, GRI, ABR, CDPE, CIAS

Certified Distressed Property Expert

Certified Investor Agent Specialist

RE/MAX Fine Properties

Arizona CRS Chapter Past President 2012

602-410-9547 Mobile Fax 480-355-9585

www.TerryForsberg.com

www.facebook.com/RealEstateArizona

Real Estate Advisor: February 2015

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Alternative Energy and Your Home

We all appreciate electricity -- each one of us uses it in some capacity every day. Heating and cooling our homes is one of our top priorities, not only for our comfort but also for our safety. In recent years more and more information about alternative and green energies has become available to consumers. Green or alternative energy is energy that is produced from renewable resources: wind, water, or sunlight. Here are some of the most-readily available options for alternative energy systems offered to home buyers right now:

Solar Power

Solar power is "the power obtained by harnessing the energy of the sun's rays." This is done through solar panels and photo voltaic cells on the panels, which convert the sunlight into usable energy. Solar power is the most common and popular option for homeowners looking to take the first step toward alternative energy. Solar uses the power of the sun, so this option is best for homes or properties located in areas where sunlight is strong year-round. There are three types of solar panel systems: On-Grid Battery Systems, which are connected to the grid but also contain batteries that can store excess energy; On-Grid Systems without batteries – these are more simple and easier to install, but if the power goes out in the area the system will shut off; and Off-Grid Systems, which are not tied to the electricity grid and generate all their power independently.

At the current moment, solar power accounts for three-tenths of one percent of the total energy consumed in the U.S. (instituteforenergyresearch.org/). For those who live in year-round sunny climates – California, Arizona, Hawaii, etc. – a solar panel system can pay for itself in as little as three years (judithcurry.com).

Wind Power

Another popular alternative energy option that has been seen throughout the U.S. is wind power. Wind power is the "power obtained by harnessing the energy of the wind." Modern wind power uses wind turbines to harness wind's kinetic energy, which is then turned into electricity. There are different types of wind power: Utility-scale, which are the large wind turbines seen on the side of hills-- these are larger than 100 kilowatts and deliver electricity directly to the power grid; Distributed, which are smaller turbines, 100 kilowatts or less, and these deliver electricity directly to a home or small business. There are also offshore wind turbines, but these are mostly found outside the U.S. At the current moment, the U.S. receives about 4.1 percent of its electricity from wind power (www.awea.org/).

Wind power is an excellent option for those who live in areas where there is a good source of wind all year long. Initially, wind power systems can be expensive, and the turbine prices vary depending on the type, manufacturer and the area you live in. Many people look to the advantages of wind power over the initial investment – utility bills are cut and the homeowner has control of knowing how his/her energy is generated, and there are generally federal tax credits available to those who buy a wind power system.

Geothermal Power

Geothermal power is "the heat from the Earth." Geothermal power takes advantage of the earth's natural heat. Geothermal energy is harnessed in two ways: tapping extremely hot temperatures via steam at great depths, or the use of moderate temperatures at shallow depths (http://instituteforenergyresearch.org/). In almost all parts of the U.S., the shallow ground (upper 10 feet of the Earth's surface) maintains a nearly constant temperature of 50 to 60 degrees Fahrenheit. To use this naturally occurring heat, consumers can install a geothermal heat pump. The pump utilizes air or antifreeze liquid in pipes. The liquid or air is pumped through the pipes, which are buried underground, and comes back into the building. In summer, when the temperatures are hotter above ground, the liquid or air moves heat from the building into the ground; in the winter, when temperatures are colder, the pipes pump pre-warmed air or liquid into the building. Geothermal power is also a renewable energy that can supply continuous power (www.ucsusa.org/)

Geothermal systems can be expensive to set up, with estimates into the low $40,000s. There are tax credits available, which can cover 30% of the total cost of a new geothermal system. Geothermal systems last about 20 years before needing new parts, and over the course of a 20 year lifespan, these systems can save homeowners upwards of $60,000 in electricity costs (www.esquire.com/).

The U.S. relies heavily upon fossil fuels for its energy sources. Currently, 82 percent of U.S. energy demand is met by fossil fuels (coal, petroleum (oil) and natural gas) while the other 18 percent is met by renewable energy and nuclear energy (instituteforenergyresearch.org/). Electricity is a vital part of the U.S. economy, and it helps a household run every day. Homeowners have options in every facet of their lives, and energy is no different. Fossil fuels are a finite resource – exploring other options available to homeowners not only opens up access to other technologies and ideas, but it also helps the Earth. Alternative energy also presents more reliable and efficient energy sources. When a homeowner or consumer gets more reliance and efficient energy, more money is saved in the long run, making for a happy, safe and sustainable home.

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Terry S. Forsberg
, PLLC,  Associate Broker

RE/MAX Fine Properties

602-410-9547 Mobile 

Certified Residential Specialist, CRS

Arizona CRS Chapter Past President

www.TerryForsberg.com
www.facebook.com/RealEstateArizona

Terry Forsberg, RE/MAX Southwest, RE/MAX FINE PROPERTIES, 21000 N Pima Rd Ste 100, Scottsdale 85255



 

Celebrate America: Made in the U.S.A

July marks our nation's birthday, and as millions gather to celebrate Independence Day, feelings and ideas of what make the United States great will undoubtedly flood the minds of those attending local barbecues, neighborhood block parties, or fireworks displays. The United States is ripe with diversity, and there's no better way of celebrating this great nation than focusing on promoting American made manufacturers and craftsmen.

While a majority of products found in homes are now produced elsewhere, there are still American companies producing quality products for every facet of life. When celebrating the Fourth of July this year, wave a flag made by Annin & Co, the oldest and largest flag manufacturer in the United States, a company started in 1847. Celebrate American independence by supporting local workers and craftsmen!

Products made in the U.S. not only offer superior workmanship, but they also help promote the U.S. economy. In recent decades, many American companies have moved production overseas, attracted by cheaper labor and production costs in less developed countries. Manufacturing is a crucial part of any economy and has been woven into the structure of the American economy since World War 2; only since the early 2000s has American manufacturing seen a steady decline, and the numbers continue to fall into 2014, but a small group of Americans have made a point of counteracting the outsourcing movement in the United States.

In recent years, more and more companies have tried to shift the focus back to American made products, and even home builders have shown an interest in promoting 'Made in America.' The Building A Better America Council (buildingforamerica.org), a nonprofit organization, was created to promote the manufacturing and purchasing of American made products in the construction industry. Portland, OR's 2013 Street of Dreams featured a home by Westlake Development Group appropriately named "The American Dream," where 97 percent of products used to construct the house were made in America -- from nuts, bolts and lighting fixtures to rescued barn wood featured in the home's rec room.

In January 2013, 84 Lumber (the largest privately held building materials and services supplier in the United States) launched its "We Build American" initiative at the National Association of Homebuilder's International Builders Show in Las Vegas, where it encouraged builders, remodelers and home buyers to purchase and use American made materials in the construction and remodeling of their homes. Partnered with Marnie Custom Homes in Bethany Beach, DE, "We Build American" promotes awareness of the benefits of building American. Marnie Oursler, founder of Marnie Custom Homes, has found the cost of using American made materials is within one-half of one percent of the cost of using foreign-made materials.

The U.S. offers innovation and a high level of talented labor, and products made in the U.S. help keep the American economy growing. Jeff Nobers, Vice President, Marketing & Public Relations at 84 Lumber, said: "If every American builder used just 5-10% more American products in the homes that they build, it would add an enormous number of American jobs in communities across the country. From sawmills in Georgia and Mississippi, to nail manufacturers in Illinois, Americans would be put to work making American products for American homes" (prnewswire.com). It's not just builders who have voiced an interest in American made products, ABC News launched its "Made in America" news section, which provides articles, blogs, news segments and other information spotlighting American made products and services.

Another aspect of American manufacturing that shouldn't be overlooked is the fact that buying products that are made in the U.S. promotes greener and environmentally conscious production standards while preventing worker exploitation. Many items made overseas are done so by people working in appalling factory conditions, paid little-to-nothing for their time and effort. Buying American made products helps U.S. workers make a living wage and sends large corporations a message that taking advantage of cheap labor isn't what Americans stand for.

While it seems as though the options for American made products might be limited, it's just the opposite. Websites such as madeinusa.org, consumerreports.org and madeintheusa.com highlight companies whose items are still made within the United States, helping home owners and consumers alike locate products and companies that are immediately local, within their state, or in the United States. Another hugely popular site is Etsy, "a marketplace where people around the world connect to buy and sell unique goods" (etsy.com). Etsy allows consumers to search specific states and cities for anything from home, living, and clothing items to wedding and craft supplies, of which many items are locally sourced and hand crafted.

Made in America products are not limited to small boutiques, online stores and home construction products -- many large American companies feature American products, some of which are staples in U.S. households. All-Clad, located in Canonsburg, PA, is the only bonded cookware manufacturer to use American craftsmen and American made metals in the production of its superior, high-performance bonded cookware. The renowned Kitchen Aid Stand Mixer is still made in Greenville, OH, and Pyrex kitchen containers and bake ware, principal items in almost 80 percent of American households, are still made in Charleroi, PA, where they've been made since the 1940s. The Oreck XL vacuum is still manufactured in its Cookeville, TN plant, and most Weber grills, some of the most popular grills of all time, are still manufactured in Palantine, IL.

Personal preference always takes priority when choosing items for the home or for life in general, but when celebrating Independence Day this year, take a moment to recognize what our nation has to offer in every area of life. American workers and craftsmen help keep our country running -- when shopping for home items, clothing, and anything else for everyday living, don't forget about Made in the U.S.A!

 
 Fannie Mae offering cash incentives to some home buyers

To reduce its inventory of foreclosed homes, Fannie offers qualified owner-occupant purchasers cash incentives toward closing costs of 3.5% of the purchase price.

 

WASHINGTON — If you're planning to shop for a home in the next few weeks, here's an early spring buying season come-on that just might save you some money if you qualify.

Fannie Mae, the largest mortgage investor in the country, has a bulging portfolio of houses acquired through foreclosures nationwide. About 31,000 of these properties are listed on its HomePath (www.homepath.com) resale marketing site. To move them quickly out of inventory, Fannie temporarily is offering qualified owner-occupant purchasers — but not investors — cash incentives toward closing costs of 3.5% of the purchase price. But you have to submit your initial offer no later than March 31 and close by May 31.

What sort of houses are we talking about? Visit the site and you'll see. They run the gamut — from a one-bedroom condo in San Diego to a four-bedroom, four-bath single-family home in suburban Montgomery Village, Md. Some states have thousands of HomePath listings online: Florida has nearly 12,000; Illinois, 4,360; Ohio, 2,800; California, more than 2,300; Washington state, nearly 1,800; and Nevada, about 1,400. Asking prices range from $30,000 to $600,000 or more. On a $400,000 house, the 3.5% closing cost incentive would amount to $14,000.

To ensure that buyers who intend to occupy its homes get an opportunity to fully check them out and bid without competition from investment groups offering all-cash deals, Fannie has instituted what it calls a First Look program. It essentially prohibits bids from investors on properties during the first 20 days after listing (30 days in Nevada). After that, investors are free to jump in. Each First Look listing has a countdown clock attached to it that indicates the number of days remaining before bidding is opened to all comers.

The new 3.5% closing cost offer is available only during active First Look periods from mid-February through March, so there's not a lot of time to get involved. Bidders will need to indicate upfront that they want to be considered for a closing-cost discount.

Who is eligible? First, you've got to be a bona fide owner-occupant purchaser and commit to live in the house as a primary residence for at least a year. You'll need to fill out a certification to that effect that can be found on the HomePath site. Properties are not available in all states.

You don't have to be a first-time buyer, though the Fannie program is likely to attract substantial numbers of them. The 3.5% closing cost discount helps with one of the biggest problems faced by first-timers — upfront cash.

As with most home purchases, you'll need to be able to qualify for mortgage financing. Though Fannie may end up owning or securitizing the loan you obtain, it won't be financing you directly. On HomePath purchases, you shop for a mortgage just as you would on any other house. Ideally, you nail down a financing source and get prequalified for mortgage money up to a specific dollar limit at current interest rates. If you've already located a First Look property and qualify, the lender is likely to take the 3.5% closing cost incentive into consideration in evaluating your application.

While you shop on HomePath, however, keep this important factor in mind: These are foreclosed, previously occupied homes. Though some of them are repaired, painted and spiffed up before they are listed, many could use some additional work. They are sold "as is" and that's built into the pricing. Fannie identifies what it calls "improved" properties on the HomePath site — those that have undergone significant repairs — with either the "Home Depot" logo (when repairs have been made by contractors from that company) or a hammer and roof symbol (when repairs have been completed by independent contractors hired by Fannie).

If you can't find the First Look house you want, don't give up. Freddie Mac, the other giant federal mortgage investor, also has thousands of foreclosed homes that it's trying to dispose of — and its own First Look program — at its HomeSteps (www.homesteps.com) marketing site. Though Freddie currently has no closing cost incentive offer, it does provide a $500 allowance toward the purchase of a home warranty policy, and it promotes special mortgage financing options on houses in some areas. If you qualify, that could mean a loan with no mortgage insurance, no appraisal and a 5% maximum down payment.

Definitely worth checking out.


February 23, 2014, 5:00 a.m.


kenharney@earthlink.net

Distributed by Washington Post Writers Group.


 
 
 
 
Feb 10, 2014, 7:32am CST

Wealthy Americans pick real estate as best investment for 2014

StaffBirmingham Business Journal

Millionaires across the U.S. say commercial and residential real estate is the best alternative-asset investment option for 2014.

One-third of millionaires surveyed in a newMorgan Stanley study plan to purchase real estate this year, Bloomberg reports. And 23 percent say they'll invest in real estate investment trusts.

NEW YORK (CNNMoney)

WHAT THE NEW MORTGAGE RULES MEAN FOR YOU 

New mortgage lending rules are going into effect Friday that aim to put an end to the worst mortgage lending abuses of the past.

The new rules are designed to take a "back to basics" approach to mortgage lending and lower the risk of defaults and foreclosures among borrowers, according to the Consumer Financial Protection Bureau, which issued the new rules.

 "No debt traps. No surprises. No runarounds. These are bedrock concepts backed by our new common-sense rules, which take effect today," said CFPB director Richard Cordray in remarks prepared for a hearing Friday.

Related: Million-dollar housing markets

Mortgage lenders are being asked to comply with two new requirements: The Ability to Repay rule and Qualified Mortgages. Here's how they will impact borrowers:

Ability to Repay

  • Lenders must determine that a borrower has the income and assets to afford to make payments throughout the life of the loan. To do so, the lender may look at your debt-to-income ratio, which is how much you owe divided by how much you earn per month, including the highest mortgage payments you would be required to make under the terms of the loan. To calculate your debt-to-income ratio, add up all your monthly obligations -- including student loan, credit card and car payments, housing costs, utilities and other recurring expenses -- and divide it by your monthly gross income.

 

Calculator: How much house can you afford?

  • In an effort to put an end to no- or low-doc loans, where lenders issue risky mortgages without the necessary financial information, lenders will be required to document and verify an applicant's income, assets, credit history and debt. For borrowers, that means more paperwork and longer processing times.
  • Underwriters must also approve mortgages based on the maximum monthly charges you face, not just low "teaser rates" that last only a matter of months, or a year or two, before resetting higher.

 

Qualified Mortgages

  • To make sure you aren't taking on more house than you can afford, your debt-to-income ratio generally must be below 43%. This rule is not absolute. Banks can still make loans to people with debt-to-income ratios that are greater than that if other factors, such as a high level of assets, justify the risk.
  • Qualified mortgages cannot include risky features, such as terms longer than 30 years, interest-only payments or minimum payments that don't keep up with interest so your mortgage balance grows.
  • Upfront fees and charges cannot add up to more than 3% of the mortgage balance. That includes title insurance, origination fees and points paid to lower mortgage interest rates.

 

The rules also restrict "steering," or practices that give financial incentives to loan officers or mortgage brokers for pushing people into higher-interest loans that they can't afford -- a practice that was all too common leading up to the housing bust, Cordray said.

 
Related: American dream homes: What you'll pay in 10 cities

"We think the new rules are balanced and well-drawn. They will offer consumers protection without limiting credit to qualified borrowers," said Gary Kalman, the policy director for the Center for Responsible Lending. 

 Lenders don't seem to be too worried about the new rules, according to Keith Gumbinger of HSH.com, a mortgage information provider. "It's no surprise; everybody has been preparing for the change for months," he said. "Because there will be additional underwriting scrutiny, it could gum up the works initially and slow loan processing, but it's really just the codification of things that are already in place."

A significant factor is what's not in the rules. There's no minimum down payment or credit score requirement.

"[The qualifed mortgage] is not taking a one-size-fits-all approach. It ensures that first time homebuyers can still come to the table," said Kalman.

Related: 5 most and least affordable housing markets

If the rules required a minimum down payment of, say 10% or 20%, it would eliminate many first time buyers who would have a difficult time raising that much cash.

The lack of a credit score requirement will enable lenders to loosen currently tight underwriting standards in the future should conditions warrant, according to Gumbinger. For the moment, most loans will still have to be backed by Fannie Mae and Freddie Mac, and, with a few exceptions, they won't approve applicants with scores below 620.

 
 
 
 

9 Mistakes Sellers Make When Hiring a Listing Agent

Hearken back, if you will, to the place and time when you bought your first home.  If you were like most buyers, your best case scenario was to find an agent who was part money manager, part negotiator extraordinaire and part therapist to help you through the process. 

But your priorities might be - scratch that - should be a little bit different when you’re looking for an agent to help you price, list, market and sell your home.

There are loads of lists to be found online and in books about the questions you should ask when you interview listing agents. But it’s a lot harder to figure out what mistakes the sellers who have gone before you would avoid, if they could. Fortunately, that’s what we’re here for.

I’ve heard from thousands and thousands of sellers over the years, online and off, about the things they neglected to do when they were selecting their listing agent - the omissions they regretted later.  Here are the top nine – and in the comments, I’d love to have you all share more!

1.  They don’t totally understand the nature of the challenge. You’re not looking for a new BFF or even for an agent who has the temperament and patience to deal with your cranky husband.  Selling a home quickly and at top dollar requires a concentration of marketing and negotiations skill and less interpersonal skill, compared with buying.  So your challenge as a Seller looking to hire an agent is to feel comfortable that the listing agent you hire has:
  • a strong, documented track record of accomplishing the results you seek for their recent, nearby listings (which might include some marketing through their local agent relationships, but might not) and
  • a strong, proactive, well-thought-out plan for helping you achieve the same success.

I’ve seen a number of sellers who list with friends or relatives that don’t have such a track record often fail to get the results they seek, even if their agent is a lovely human being with strong skills getting homes sold 3 states over in a totally different marketplace with totally different market dynamics.

2. They fail to understand roles and responsibilities.
  When sellers have a bad home-selling experience, 9 times out of 10 that means that their home lagged on the market, sold for way below listing or was in and out of escrow a bunch of times. Sometimes, the fault for these things does fall on the listing agent, especially if there was some sort of huge marketing fail, like the place was listed online with no photos or it was somehow otherwise not fully exposed to the market.  But many, many times the fatal flaws I see in listings are things that are (a) decisions the Seller themselves ultimately made, and (b) the Seller made in direct opposition to their agent’s advice.

Overpricing a property for the market dynamics, failing to handle some major condition or aesthetic issues and/or making it unavailable for showings are 3 things that listing agents spend much of their working lives advising sellers to do differently - which is advice most unhappy Sellers ignore or refuse to follow.

As you interview listing agents, talk with them about which pieces of the process of getting your home sold are things they are responsible for – and which pieces you are ultimately accountable for. And as you walk with them through their plans for preparing, pricing and marketing your home, if you find yourself feeling like pushing back against every thing they say, consider whether that dynamic will truly serve you well throughout your transaction.  Hiring the best agent ever means very, very little if you refuse to follow their advice, whether your reasons for refusing are right or wrong.

3. They omit to ask for the right data – or for any data at all.  Sometimes, the power of an agent’s personality or the lore of a longtime locally legendary agent’s prowess precedes them and takes over the conversation.  And this isn’t all bad: an agent with a super strong local reputation probably got it by dint of the very skills they’ll need to wield in selling your home, and highly social agents often have fantastic buyer broker relationships they use in getting the right target buyers into their listings (read: your home). 

That said, if you are at the dining table with an agent, don’t let the conversation get so derailed that you fail to ask for and review the important data points. 

You need to know a few key numbers, including:
  • The average number of days their most recent listings have stayed on the market before selling (and how that compares to the area average)
  • The average list price to sale price ratio they achieve for their listings (and how that compares to the area average)
  • How many listings your home would be competing with if you listed it today (and how they justify which homes they threw into that mix)
  • How many offers most home sellers in your area are fielding
  • How many other listings they currently have, and how many team members are available to service them.

Ask for this data and discuss with the agent candidate how it applies to the decisions you need to make: starting with your agent choice, but also including your pricing and timing decisions.

4.  They fail to understand the data. 
A lot of people who are super smart, Type A folks are so used to being highly competent that even when a listing agent candidate proactively presents data like that described above, they fail to ask questions about things they don’t understand.  Let me tell you - if you don’t do real estate all day everyday, there’s no reason to expect that you’ll have mastery over this information at first glance. 

If you don’t understand the data, the marketing plan or anything else the agent presents to you: ask. And keep asking until you do fully understand the information and it’s implications for you - even if you think you’re asking a silly question, you think it should be obvious.  It’s a great way to make sure the relationship starts off on the right foot, and that you’re picking an agent who is happy and easy about breaking complex information down until you’re comfortable with it.

5.  They don’t check references. As with all of the often-omitted items on this list, listing agent candidates often provide references to potential Seller clients as a matter of course.  But very few folks actually call and check them.  Do.  You can come up with a list of questions or just tell the reference contact a little about your situation and ask them to share something of their experience with the agent.  Let’s be real – no agent is likely to give you references who are going to talk badly of them.  But approaching your reference checks with the intent to have an open conversation about the past clients’ experience creates the opportunity for you to get all sorts of nuanced insights, rather than just a “good agent” or “bad agent” rating.

6.  They don’t ask for a detailed marketing plan.  It’s essential to know precisely what steps your agent plans to take to market your home, before you hire them. What sites will your listing show up on?  How many pictures will the listing include?  What about Open Houses or marketing directly to buyer’s brokers?  How do they propose to ensure that every qualified buyer who is on the hunt for a home like yours will see it? 

Having a written marketing plan in hand (or in some digital format) empowers you to do things.  If your home lags on the market, it’s a troubleshooting checklist that might surface what hasn’t happened or where an error might be glitching up your home’s marketing.  And if you do the checklist and the home does appear to have been well and fully marketed, the plan can provide a strong proof point in favor of a price reduction.

7.  They don’t discuss property preparation.  Different agents might have very different approaches to what needs to happen to your home before it goes onto the market. They might also have different approaches to how that work will get done.  Some agents manage property preparation from soup to nuts, while others will give you some thoughts on what needs to happen and leave you to do it. Some will refer you to stagers and vendors, while others will bring people in on their own dime to actually execute their vision, and still others might even have access to home improvement contractors who will do some work now for payment after closing (this often depends on your price point and on what practices are standard in your market).  Talk to every agent you interview, in detail, about what they envision will need to happen to your property before they list it, and how intensely involved they can and will be in helping you get the work done.

8.  They don’t ask about Plans B, C and D.  The real estate market wouldn’t be the real estate market if it didn’t throw you curve balls.  Some agents are strong at executing a cookie-cutter marketing plan so long as everything goes smoothly, but are not-so-great at problem solving when things don’t go as planned. Unfortunately, it’s tough to know that your agent lacks a backup plan until you actually need it! Ask your prospective agent candidates what complications, challenges and surprises they have encountered recently in their listing transactions and how they resolved a couple of them.

9.  They don’t read the contract.  One of the most major freak-out moments I see happen with disgruntled Sellers (i.e., members of the club you’re trying not to join) arises when they are very upset with their listing agent and decide to cancel the relationship only to realize they’ve signed a contract locking them into it for 17 years. (I exaggerate, but you get the gist.)  Similarly, some listing agreements have terms that mandate the Seller pay the agent’s commission if the Seller receives (but doesn’t accept) an offer meeting certain criteria or if the Seller finds the Buyer themselves. 

The moral of the story? Read your listing agreement before signing it.  Walk through it with your almost-agent, and don’t sign it until you understand your commitment. 
By Tara-Nicholle Nelson
Survey: Most US homebuilders optimistic about home sales for first time in 7 years
For the first time in seven years, most U.S. homebuilders are optimistic about home sales, a sign that construction could help drive stronger economic growth in coming months.

The National Association of Home Builders/Wells Fargo builder sentiment index released Monday leaped to 52 this month from 44 in May. It was the largest monthly increase since 2002.

A reading above 50 indicates more builders view sales conditions as good, rather than poor. The index hasn’t been that high since April 2006, just before the housing market collapsed.

Measures of customer traffic, current sales conditions and builders’ outlook for single-family home sales over the next six months also soared to their highest levels in seven years.

The housing recovery is looking more sustainable and should continue to boost economic growth this year, offsetting some of the drag from higher taxes and federal spending cuts.

Steady hiring and low mortgage rates have encouraged more people to buy homes. The increased demand, along with a tight supply of homes for sale, has pushed home prices higher. That’s made builders more optimistic about the market for newly built homes, leading to more construction and jobs.

In April, applications for new home construction reached a five-year peak. And sales of new homes rose to a seasonally adjusted rate of 454,000, nearly matching the fastest pace since July 2008. Sales are still below the 700,000 pace considered healthy by most economists. But they have risen 29 percent in the past year.

Single-family home construction slowed in April to a seasonally adjusted annual rate of 610,000 homes, but that’s expected to grow sharply in coming months.

“We are forecasting a considerable acceleration,” said Greg Bird, associate economist with Moody’s Analytics, which projects that housing starts on single-family homes will reach an annual rate of 1.6 million by the end of 2014.

In recent weeks, many of the major large homebuilders have reported strong annual growth in sales during the spring home-selling season. The increased demand has paved the way for builders to raise prices and ramp up construction of more homes, despite lingering concerns over rising costs for land, building materials and labor.

“Builders are experiencing some relief in the headwinds that are holding back a more robust recovery,” said David Crowe, the NAHB’s chief economist.

Homebuilder Mitchell & Best, which builds homes in Maryland and Virginia, expects to deliver between 30 percent and 40 percent more completed homes this year than in 2012, said vice-CEO Marty Mitchell.

“As a small local builder who has been through trials and tribulations the last seven years, we’re definitely seeing an improvement in the market,” Mitchell said.

Still, the company, which sells homes ranging from $700,000 to $1.5 million, is struggling to find enough land to build more homes.

Land in the Washington metro area remains scarce. And the price has risen sharply in the past year as demand for new homes has increased.

Mitchell said he hopes to boost construction next year ahead of this year’s levels, so long as the company can tie down a few more tracts of land.

Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to NAHB statistics.

The latest builder confidence index was based on responses from 255 builders.

A gauge of current sales conditions for single-family homes jumped eight points to 56, the highest level since March 2006, while a measure of traffic by prospective buyers improved seven points to 40.

Builders’ outlook for single-family home sales over the next six months increased nine points to 61, the highest reading since March 2006.

On a regional basis, confidence grew strongest among builders in the South, while firms in the Northeast and Midwest also posted a gain. An index of confidence among builders in the West declined by one point.

By Associated Press, Published: June 17
 
Keith Srakocic/Associated Press - In this Monday, May 6, 2013 photo, construction is underway on the infrastructure of a multi-acre housing development in Zelienople, Pa. For the first time in seven years, most U.S. homebuilders are optimistic about home sales, a sign that construction could help drive stronger economic growth in coming months, according to reports Monday, June 17, 2013.
 
RE/MAX Fine Properties Shines in the Southwest 
 Associates at RE/MAX Fine Properties in Scottsdale, Ariz., know they’re among the best in the business – and now they have three new awards to prove it.
 
The company was recently named Brokerage of the Year at the 2013 Arizona Real Estate Achievement (AREA) Awards, sponsored by AZ Business Magazine. A panel of industry experts chose RE/MAX Fine Properties from a field of nominated offices, and presented the award at a reception at the Ritz-Carlton on May 9.

 

In addition, RE/MAX Fine Properties Designated Broker Sheila Strunk was just named one of the Top 10 Women in Business by Republic Media’s Who’s Who In Business magazine. The same magazine also listed the brokerage on its Top 10 Residential Real Estate Businesses.

RE/MAX Fine Properties was founded in 1997 and is currently the highest volume office in the Phoenix Metropolitan area. In 2012, the office closed 1,598 transactions for more than $552 million, and has a reputation for excellence in customer service, agent training and business planning.
 
 

 BROKERAGE OF THE YEAR: RE/MAX Fine Properties Designated
 Broker Sheila Strunk (center) and Operations Manager Kaci Hathaway
 (right) accept the Brokerage of the Year Award at the AREA Ceremony
 in May.

 

 

Fix This, Not That: 6 Tasks to Do (or Not to Do) Before You Sell 

Online, you can find dozens and dozens of return-on-investment (ROI) calculators which aim to do the math on whether a given home improvement project is worth the money (or not). They tend to focus on how much of the remodeling spend will come back to you in the form of added value when the home is sold.  I submit that this is only one part of the equation, as the primary measurement for many home improvement projects should be tallied up in terms of lifestyle improvement over the years you plan to benefit from the increased comfort, joy or efficiency of your newly-improved home.

Surprisingly, this calculus of what home upgrades are (and aren’t) worth doing gets slightly more complicated in the context of preparing a home for sale.  It seems like it should be even more simple - dollars in vs. dollars out.  But most agents or stagers will tell you that preparing a property for listing is more art than science, in that there are many human factors that must be weighed and balanced against the costs involved. 

For instance, whether a given project is worth doing sometimes depends on the current state of the property vis-a-vis local buyers’ expectations at that price range.  It can also depend on the relative aesthetic and perceptual boost that a particular project promises, and on any negatives that the property needs to compensate for.  The seller’s budget and even local municipal codes all must be factored in.

Accordingly, there’s no single set of black-and-white rules that apply to every property and every seller.  But here are some rules of thumb and food for thought that you should walk through with your agent or stager if you’re in the process of trying to figure out which tasks to do - and which to leave for your home’s next owner - before you put your place on the market.

FIX:  Paint. There is simply no accounting for the massive upgrade a fresh coat of paint can bring to the look and feel of your home, inside and out - especially given the relatively low cost and high do-it-yourself-ability of painting.  A home that is freshly painted inside and out reads as fresh, clean and ready for new life, from a buyer’s perspective.  A taupe wall with white trims and moldings has essentially become the new white wall of this generation - the aim is to go neutral, not boring.

If you can’t afford the time or cost to paint everything, take a hard look at your walls and rooms and see which hallway or room(s) need it the most.  Also, painting your trims, doors and moldings can go a long way toward de-shabbifying a place.  Similarly, on the exterior of your home, I cannot overstate the polish potential of painting the trims a bright or deep, color. Changing the color and refreshing the paint on your exterior shutters, doors and eaves gives a powerful update and burst of color to the place. 

Check in with your stager and agent about your color palette for any pre-listing paint projects before you have the hardware folks mix up a vat of chartreuse semi-gloss for the kitchen walls.

DON’T FIX:  That uber-luxe kitchen remodel you always wanted. Do gorgeous kitchens sell homes? Yes. But they also easily run into the tens of thousands of dollars. Unless your home’s existing kitchen is truly cringe-worthy, a high-end overhaul just before listing is not likely to even recoup what you spend on it. I advise sellers who are hemming and hawing about a kitchen remodel to do it while they and their families can still enjoy it.  If you’ve already decided to move on from the home and the kitchen is so bad as to render the place un-sellable, your agent and stager can help you come up with a moderate plan for whipping it into shape without breaking the bank.  Repainting or refacing cabinets (instead of replacing them), installing butcher block counters (vs. marble or stone) and replacing your avocado green appliances with nice GE or Kenmore versions (vs. Wolf and Miele) might be the route to go. 

Caveat: if your home is competing with luxury properties and you insist on listing it at top dollar, you might actually have to go with a higher-end kitchen upgrade plan before you list it. Think long and hard about whether this make more sense than simply discounting the property or offering a kitchen upgrade credit to the buyer.

FIX:   Plumbing problems.  Plumbing leaks make noise, cause damage to the wood structure and areas around them and are often believed by buyers to cost more to fix than they actually do. In some parts of the home, plumbing leaks are prone to being called out as conditions conducive to long-term structural problems by pest and structural inspectors. If you can have a handyman or plumber come in and eliminate drips and leaks, you will simultaneously eliminate some buyers’ objections or concerns about your home. 

And this goes for sewer line issues, too.  An increasing number of areas are now requiring that the sewer line from home to the sewer main in the street be inspected before or during a home’s sale - and be repaired or replaced if it is cracked or broken.  If you’ve had chronic backups or your home’s sewer line is simply due for an inspection, work with your agent to get the appropriate inspector out there now to get an understanding of what sewer line work will need to be done to comply with any local point-of-sale ordinances.

A new sewer line is a great draw for a buyer, as is one with a clean bill of health. If your line does need work, you and your agent might decide not to repair or replace it, based on your budget, how much of a seller’s market your area is currently experiencing, legal requirements and standard practices in your area. But you should have the state of the sewer line in mind, for better or for worse, before you set the list price for your home and begin preparing your disclosures for prospective buyers.

DON’T FIX:  Malfunctioning, costly appliances.  Consider offering a credit for the buyer to use to replace appliances that don’t work - or don’t work well. Buyers appreciate the ability to select their own new appliances on your dime. That said, it can be difficult for some buyers to get past the collective aura of bad repair that arises when a home has a whole host of really old or beat up appliances.  In some cases, it might even make sense to simply remove an appliance entirely, without replacing it at all.  In others, a replacement or a credit might make more sense - this is a topic for discussion with your listing agent, who should have a good understanding of what’s normal in your area and important to local buyers.

If you do decide to replace an appliance, consider resources like Craigslist, where you might be able to find used items in good repair at a fraction of the new cost.

Caveat: if you are in a price point or area where the average buyer uses an FHA loan to finance their home, there are certain appliances which must be in the home at closing, like a functional stove.  Discuss with your agent before you start ditching the old appliances.

FIX:  Old and outdated hardware, fixtures and finishes.  Hardware can refer to the little metalworks that make things work (or not) throughout your home, like hinges that make a door hard to close, cabinet and drawer handles and pulls or your closet door and drawer slides.  These are all the sorts of things buyers test out while they’re viewing a home. However, it also includes things that might work fine, but look outdated, like light switches, door knockers and kick plates.  Hardware, as a general rule, is inexpensive as home fixes go - if it will make your home function more smoothly and look like it’s been well cared-for, the low investment is well worth an upgrade.

Scuffed and scratched wood floors; 80’s era carpet, gold-plate lighting and faucet fixtures and even more recent upgrades that have seen better days (e.g. bowing and warped laminate floor sections) should all go on the list of finishes and fixtures to fix or replace before you list.  All cracks, chips, scuffs and nicks should go on the list, for that matter.

The rationale is the same: they are a highly cost-efficient fix vis-a-vis the big bang they make on your home’s appearance to buyers.

DON’T FIX:  Replacing old windows.  This is a project that many crave to do, especially if the windows are single-pane, aluminum framed, or involve rotten wood casings.  But it’s also a project that can easily become extremely expensive, and one that often snowballs into costly, time-consuming framing repairs.  Aluminum frames around windows can sometimes be spruced or painted to make them look at bit better, if absolutely necessary. And even old wood windows that have issues often create a generally charming feeling that helps a buyer see the home’s potential they can restore, better than if you replace it with inexpensive fiberglass windows before listing the place for sale. 

This advice is primarily for those tempted to replace a whole house worth of windows - if you have one window that is particularly offensive or allows water in, or even have multiple window panes that are cracked or broken, these are things you might want to repair or replace.  Your agent can help you make a suitable action plan on this score.

By contrast, if you have old, dinged, ugly or broken doors, toilets and sinks anywhere in your house, these are things you may want to rip out and replace before listing your home.  You might be amazed at how fast and inexpensively these fixes can be done, and how much of a stylistic upgrade and update you can get out of them.  ByTara-Nicholle Nelson / Broker in San Francisco, CA 
 
 
 
 
 
 
 
 
 

10 Mortgage Misconceptions

Mortgages are tricky and often hard to understand. Because most people only purchase a home every five to seven years, prospective homebuyers understandably don't spend a lot of time in the interim educating themselves about mortgages and the mortgage process.

With the real estate market picking up and mortgage rates prime for refinancing, Zillow has compiled a list of common mortgage misconceptions based off the results of the just released 2013 Mortgage IQ Survey.

Misconception No. 1: Your interest rate reflects the true cost of your mortgage. Your annual percentage rate is actually the figure that represents the true cost of your mortgage. It is inclusive of your interest rate, points, mortgage insurance (when applicable) and other fees, including origination and underwriting fees. It does not include the cost of your homeowners insurance policy. The APR is typically higher than your interest rate because it incorporates the rate and the fees. In fact, when shopping for a mortgage, it is best to compare loans based on APR instead of the interest rate because it gives a better sense of the total cost over the life of the loan.

Misconception No. 2: Mortgage rates are only released once per day. Mortgage rates for all types of mortgages can change frequently, sometimes dramatically, throughout the day. Because of the rapid changes in mortgage rates and a lender's ability to control what is offered, it is important to shop around for the best rates. Getting multiple loan quotes is highly recommended.

Misconception No. 3: All lenders are required by law to charge the same fees for appraisals and credit reports. There are no laws that require lenders to charge the same fees for services such as appraisals or credit reports. In fact, in order to make their loan quotes more competitive, some lenders may waive charges for such services. Conversely, some lenders may charge higher fees for these services, so it's important to shop around.

Misconception No. 4: I must get my mortgage through the same lender I was pre-approved with. A pre-approval is a conditional agreement that estimates the size of the home loan a lender would fund for you. It typically involves income verification and a credit check. However, you are under no obligation to proceed with the lender that gave you the pre-approval. Make sure you get at least three loan quotes before proceeding with a mortgage.

Misconception No. 5: You will almost always get the best mortgage interest rates at the bank where you have a checking account. While some banks do give their customers discounts, it's unlikely your bank will offer the best interest rate available simply because you bank there. To get a competitive mortgage rate and terms, get quotes from multiple lenders either in person or online - including your bank - and pick the one that works best for you.

Misconception No. 6: When taking out a mortgage with your spouse, lenders will look at each of your credit reports equally when determining the interest rate you qualify for. When applying jointly for a mortgage, lenders will pull your credit scores from each of the three major credit reporting agencies: Experian, Equifax and TransUnion. They'll then take the middle score of each set and use the lower of the two to help determine your mortgage interest rate. This means that the least creditworthy borrower will have the greatest effect on your monthly payment. It does not matter who the primary or secondary borrowers are.

Misconception No. 7: You cannot get a home loan with less than a 5 percent down payment. It is a common misconception that you need to put down 10 percent, 15 percent or even 20 percent on a home, especially in light of the recent housing crash. But with as little as 3.5 percent down, you can often obtain a mortgage through the Federal Housing Administration (FHA). FHA loans have become a popular loan option for those who may not have a large down payment or have blemishes in their credit history. FHA loans are available to everyone, not just first-time home buyers. (Find out more about the advantages and disadvantages of an FHA loan here.)

There are also alternative loan programs through other agencies, including the Department of Veterans Affairs (VA) and the United States Department of Agriculture (USDA). These loans also require little-to-no money down.

Misconception No. 8: If you go through a short sale or foreclosure, you must wait 7 years before getting another home loan. In most cases, to buy a home after a short sale, you'll typically only need to wait 2-4 years depending on your down payment and the loan type you select. The waiting period after a foreclosure is longer: Typically you'll need to wait 3-7 years before getting another home loan. Even if you can afford to get a mortgage right now, you'll need to have a good credit score, which can be difficult to rebuild in just a few years. Unique circumstances can lead to different outcomes, so make sure to check with a lender or two.

Misconception No. 9: If you are underwater on your home loan, you are unable to refinance. It is estimated that millions of homeowners who are underwater and current on their mortgage can refinance using one of two special government programs. The first, the Home Affordable Refinance Program (HARP), is available to homeowners who have a loan backed by Fannie Mae or Freddie Mac. The second program, FHA Streamline Refinance, has recently been modified to help homeowners with loans insured by the Federal Housing Administration (FHA). Both programs help homeowners refinance into lower interest rate loans and may help dramatically lower payments without very much cost to the borrower. Zillow Mortgage Marketplace is the only online mortgage marketplace where you can get loan quotes for HARP and FHA Streamline. As an added bonus, it is the largest mortgage marketplace where you can anonymously get loan quotes, meaning you don't enter any personally identifiable information and therefore cannot get spammed and hounded by lenders who were sold you contact information. See if you may qualify.

Misconception No. 10: You can only refinance your home loan once every 12 months. With conforming loans backed by Fannie Mae or Freddie Mac (the vast majority of loans today), you can refinance as frequently as you'd like so long as you do not take cash out when you refinance and are just refinancing to lower the interest rate and/or term of your mortgage. The rule of thumb is to wait until the difference between your current interest rate and the available interest rate would save you enough money each month to cover the costs of refinancing in two years. The amount of time that you plan on being in the home should be considered, as well. In general, refinancing will be more financially beneficial the longer you are in the home. Use the refinance calculator to determine how long it will take to break even on the costs of refinancing.

If any of the misconceptions had your name written all over it, visit the Zillow Mortgage Marketplace Help Center, where you can brush up on everything mortgage before you refinance or purchase your next home. You can also take the Mortgage IQ Quiz for yourself, or send it to a friend who is in the market; they'll thank you.
 
By Alison Paoli

 

Housing Passes One Million Mark

Housing construction passed the psychological mark of one million starts in March coming in at 1.036 million homes, up 7 percent from an upwardly revised February level of 968,000. The surge was due to a 31 percent increase in apartment construction to a level of 417,000 units, the highest since January 2006. Single-family construction fell 4.8 percent to 619,000 from an upwardly revised February level, which was the highest since May 2008. The first quarter single-family average was 628,000 up 6 percent from the fourth quarter 2012.


Housing permits were down 3.9 percent but from a February high not seen since July 2008. The first quarter average was 915,000 up 2.6 percent from the fourth quarter. Builders were stock pilling permits in February and the inventory of unused permits dropped 9 percent in March as a replacement for drawing more permits. Single-family permits were virtually unchanged so the change was due to a 10 percent drop in apartment permits likely because we are approaching the sustainable level of apartment construction.


Regionally, starts were up in all regions except the Northeast, which was down 5.8 percent monthly but up 12.6 percent annually. Midwest starts were up 9.6 percent month-to-month and 28.4 percent from March 2012. The South was up 10.9 percent monthly and 58.2 percent annually and the West was up 2.7 percent monthly and 53.7 percent annually.

The mixed results were in line with NAHB expectations for 975,000 starts in 2013 or a 25 percent improvement over 2012.

Housing Permits and Starts

 

Metro Phoenix housing rises across the board

Region’s median sales prices increase 34% in a year; more homes are for sale

 For the first time since the housing-market free fall began more than five years ago, it’s now possible for every type of player to get back in the real-estate game.

Basic economic laws of supply and demand worked their magic over the past year, as a huge number of distressed properties were snapped up by institutional buyers and other investors. That played a big role in solidifying the market, and as the year passed, a stronger economy brought a healthier mix of players into the game. They included an ever-growing number of first-time buyers, new-home buyers and homeowners who finally were able to sell for a profit.

Overall, the growing group of buyers helped propel the region’s median sales price up more than 34 percent in the past year, as affordable properties on the market were in limited supply. That price increase, in turn, has motivated more homeowners to put their homes up for sale because they are no longer underwater.

Analysts say home prices are expected to continue to climb this year because of the low supply of homes for sale and rising demand from regular buyers trying to purchase.

Big investors, always looking for rock-bottom prices, appear to be moving on to other markets, leaving metro Phoenix more accessible to traditional homebuyers.

The increase in home values has made it more difficult for prospective first-time buyers, but properties are still affordable compared with prices during the boom.

New-home sales and prices also are rising, mostly due to buyers tired of competing to purchase houses in areas with good schools, jobs and shopping. Most important, a growing number of homeowners can sell for a profit again.

Increases

Overall, metro Phoenix homeowners are likely feeling more flush. The median sales price in most of the region’s ZIP codes climbed more than 10 percent last year, according to The Arizona Republic’s Valley Home Values report. Much larger median sales-price increases often were recorded in ZIP codes where prices had dropped the most.

Some parts of the Valley saw home-sales prices soar more than 30 percent. In the west-central Phoenix ZIP code 85015, the median price shot up more than 55 percent during 2012, the biggest annual gain in metro Phoenix. The number of homes sales in nearby Phoenix ZIP code 85012 jumped 53 percent, the biggest increase Valley-wide.

Around Mesa’s Red Mountain Freeway in ZIP code 85207, the median home jumped 40 percent. In north Glendale, the median sales price soared 35 percent. South Scottsdale, a more affordable part of the city, saw a 24 percent increase in prices within ZIP 85250. Tolleson led the southwest Valley with a 36 percent increase in its median sales price. Queen Creek’s 85142 ZIP Code led Pinal County for home price gains with a 37.8 percent increase.

Overall, the median home-sales price rose 34 percent, to $164,000 in 2012 from $122,500 in 2011, up 34 percent. Reflecting the tight supply, the number of home sales dropped almost 2 percent, to 102,837 in 2012 from 104,629 in 2011.

The median price of a metro Phoenix home hit a record $250,000 during the housing-boom peak in 2006.

“Areas of the Valley with the biggest shortage of homes for sale are seeing the biggest price increases,” said Mike Orr, real-estate analyst with the W.P. Carey School of Business at Arizona State University. “Everyone is participating in the housing-market recovery, and those who aren’t want to, but can’t yet.”

A further sign of a healthier market: Foreclosures dropped 46 percent, to 24,073 in 2012 from 44,700 in 2011.

First-time buyers

Because prices remain affordable, the biggest obstacle for most first-time buyers is competing with investors who can pay cash and who are not concerned about a house’s appraisal. For homebuyers taking out mortgages, the appraisal must come in at least as high as the purchase price, or they have to come up with the difference.

Alyssa Shanosky, a pharmacist, recently bought her first house. She found the south Arcadia home when it had been on the market for only a few days and competed with other buyers by agreeing to purchase the house “as is.” She put 20 percent cash down.

“It’s tough for many first-time buyers to compete with investors who can pay cash,” said Christine Espinoza of Phoenix-based HomeSmart, who worked with Shanosky. “The sellers knew the price they wanted and didn’t want to get nickled and dimed. And luckily the appraisal came in higher than the selling price.”

Shanosky is updating the house with wood floors, stainless-steel countertops and tile.

Orr said the shortage of homes for sale under $150,000 is causing bidding wars among first-time buyers and investors.

Normalicia Arellano lived in a manufactured home and saved for several years to buy her first house. The single mother works at Intel and wanted to buy a house near her daughter’s school.

“It was like finding a needle in a haystack, but we found a house she could afford across the street from the school,” said Yamile Hirsh of HomeSmart. “I feel bad for many first-time buyers. There’s so much competition for the houses they can afford.”

New-home buyers

The number of homes built in the Phoenix area climbed 71 percent to 11,600 in 2012. New-home sales followed the trend, with buyers closing on 10,034 new houses last year, up 41 percent from 2011. These are the biggest jumps for the new-home market since 2006.

Overall, the median price of a new house climbed almost 15 percent during 2012 to reach $240,000.

Southeast Valley communities Gilbert, Chandler, Mesa and Queen Creek are seeing the most home construction because the areas have the strongest buyer demand.

Sam Cutruzzula recently purchased a new Fulton home in Gilbert’s Freeman Farms. It’s the second Fulton home he has bought. The first house he was able to sell for a profit to help pay for the new one.

“We looked at existing homes, but it was difficult to find one that matched our needs,” Cutruzzula said. “Even houses that were six or seven years old needed work.”

New-home prices in the Cutruzzulas’ neighborhood climbed almost 13 percent in 2012.

In February, the median price for a new metro Phoenix house reached $257,428, a 15 percent increase in 12 months, according to RL Brown Reports.

Move-up buyers

Overall, a growing number of homeowners in areas with the biggest increases in sales prices can sell for a profit again. By fall, more homeowners who bought in 2002-03 realized they finally had enough equity to sell for a profit.

But most homeowners interested in making a move are still on the fence, waiting for prices to increase more before moving up or downsizing. That keeps the supply of homes for sale tight. But growing signs of a more normal market are evident.

Regular home sales — between homeowners who don’t need to sell through a short sale or to avoid foreclosure and buyers who are going to move into the house — climbed 50 percent in January from the year before.

“Rising prices have allowed many more metro Phoenix homeowners to sell,” said Diane Brennan of Scottsdale-based Keller Williams Integrity First Realty. “The worst mistake sellers can make now is not pricing their home correctly.”

Shoppers are getting weary of bidding wars and listings pulled off the market by sellers only to be re-listed at higher prices a month later, she said.

Investors back off

Investors purchased thousands of houses in 2012 and helped drive up prices, particularly in metro Phoenix’s more affordable neighborhoods.

Now, higher prices are deterring some. Foreclosures have slowed to 2007 levels, so the supply of inexpensive houses being sold by lenders, mostly to investors, is rapidly dwindling.

In January, 31 percent of the region’s home purchases were made by investors. That’s still relatively high for a normal housing market. But its the lowest level of investor homebuying in metro Phoenix since early 2011.

“As prices have increased, we’re now seeing more real buyers with families looking for a home as opposed to investors looking for investment properties to turn a profit,” said Diane Watson of Scottsdale-based Russ Lyon Sotheby’s International Realty.

“Many of these investors have moved on to other markets.”

Forecast

Housing analysts predict this more normal housing market to expand in 2013, with more listings and steady price gains, especially in more affordable areas of metro Phoenix.

There could be setbacks if interest rates rise too fast or prices climb too high, Orr said.

Also important for the housing market’s continued recovery is more homeowners selling and more new homes going up.

Orr summed it up: “Housing prices are going to continue to climb more rapidly than normal, until there’s a balance between supply and demand in the market.”

 The Republic  |  azcentral.com

 

For the first time in 4 years, cash home buyers aren't king in Phoenix

Cash home sales are declining in the Phoenix area.

The old expression that “cash is king” has been reality for the metro Phoenix housing market since the downturn — until now.

Cash purchases, mostly by investors, were dethroned of their four-year reign last month when they were outnumbered, albeit only slightly, by conventional loans, according to a report this week by Grand Canyon Title Agency Inc. in Phoenix.

There were 2,188 homes Valleywide that were purchased with conventional mortgages last month, eclipsing cash sales by only 44, the report said.

At a time when Phoenix has been facing a chronic shortage of homes for sale, the waning dominance of cash buyers means traditional home buyers have a better fighting chance when in the throes of a bidding war. This week’s report is a testament to the previously reported trend that cash buyers have been slowly pulling out of the market as prices increase because of limited inventory and only a trickle of bargain deals now available via short sales and foreclosures.

In fact, the supply problem prompted a 7 percent year-over-year decline in Valley home sales last month to 5,960; however, last month’s sales numbers were up by nearly 24 percent from just February, a sign that the bustling home-buying season now is under way.

At the same time, the supply problem also has jolted home prices upward — with the median price per square foot breaking the $100 mark last month for the first time since September 2008, the report said.

But despite their slow retreat, investors are still a major force in the market and cash sales are still high by historical standards.

In March, cash purchases accounted for 36 percent of all home sales Valleywide, the report said. That’s notably down from 41.5 percent a year ago but still staggeringly higher than in March 2008 when only 16.1 percent of homes were bought with cash.

Kristena Hansen covers residential and commercial real estate.

 

The Republic  |  azcentral.comMon Mar 25, 2013 11:40 AM

It’s a seller’s market in metro Phoenix real estate, with so few moderately priced houses on the market that typical buyers have to scramble to make a deal.

Last week, about 13,000 houses and condominiums across the region were listed for sale. In 2008, there were four times as many houses for sale in the Phoenix area, according to the Arizona Regional Multiple Listing Service.

Houses, particularly those priced below $200,000, are selling faster than they have since mid-2006, at the peak of the housing boom. The typical house now sells within 72 days, almost half the time it took five years ago.

Investors are motivated to buy because they can pay cash for affordable houses and turn them into profit-generating rentals. The improving economy has been a catalyst for traditional buyers as well, but they also are looking for bargains. The typical first-time buyer in metro Phoenix, who can’t afford to pay much more than $150,000, also wants to close a deal before interest rates rise.

The growing group of prospective buyers propelled the region’s median sales price up more than 34 percent in 2012. That price increase is expected to motivate more homeowners to put their homes up for sale because they are no longer underwater, but demand also is expected to rise.

For those in the market, the competition can be frustrating and time-consuming.

“There’s no doubt it’s a tough market for many buyers,” said Tom Ruff, real-estate analyst for the Information Market, a division of the regional multiple-listing service.

Multiple bids

Generally, the highest-priced houses for sale are in Scottsdale, Paradise Valley, some north-central Phoenix neighborhoods and the southeast Valley communities closer in. The least expensive houses can be found in parts of central and west Phoenix and the southwest Valley.

The limited supply of moderately priced houses is most out of whack with demand. Many first-time buyers, investors and others are seeking properties listed at or around $150,000. The median price of a house for sale in metro Phoenix during February was $185,000.

Melissa Jankovich has been trying to buy her first home for almost a year. The hairstylist wants to live in Tempe or central Phoenix near her job and friends. She’s been looking for a house that is priced at $175,000 or less and doesn’t need a lot of work.

“I have been outbid on so many houses I can’t remember them all,” Jankovich said. “I was discouraged last year. Now, I am a little numb to the process.”

Jankovich has been able to save more money for a down payment during the past year and now can afford a slightly higher-priced house. She also hopes there will soon be fewer investors to compete with.

“I keep hearing prices are getting too high for many investors, but so far they are still bidding on the houses I want,” Jankovich said.

Today, most of the houses priced below $200,000 are in the West Valley or much farther out in Pinal County communities.

Higher prices

As home prices rise, more sellers are expected to put their houses on the market, either when they no longer are underwater on their mortgages or when they believe they can make a good profit. But demand is projected to outstrip supply for quite some time.

“We still have a long-term supply shortage, with only about 50 percent of the active listings that we would expect to see in a normal market,” said Mike Orr, director of the Center for Real Estate Theory and Practice at Arizona State University’s W.P. Carey School of Business.

“Most homes priced reasonably below $500,000 continue to attract multiple offers in a short time. Sellers are firmly in control.”

In addition, housing analysts say some homeowners will wait another year or two to try to make more money on the sale of their house.

Why? The forecast calls for prices to keep climbing.

“As long as the supply is constrained for houses that buyers want, home prices will climb in the areas where those homes are located,” Orr said.
TYM2SEL !!!  602-410-9547

 

It’s a Sellers Market in Phoenix Homeowners who have been waiting to sell their home in the cities making up metro phoenix, this is the time to become Sellers. It’s a Sellers Market There are simply not enough homes for sale in today’s market to meet Buyers demand. Low inventory has been a problem over the past year. Many would be Sellers are still underwater with their mortgages. According to a report as many as 40% of homeowners are stuck and cannot sell their homes until the value of their home rises. There were 12,623 Valley home listings on the Arizona MLS on Jan. 1, down 6 percent from a year earlier and far below normal supply levels, according to Arizona State University’s housing report earlier last month. Foreclosures and Short Sales which made up the lions share of homes for sale in metro Phoenix have been snapped up by Investors. The Valley no longer offers the best opportunities for Real Estate investors and they have moved on to greener pastures in cities like Atlanta. Sellers Enjoy Less Time on the Market The good news for Sellers in Phoenix is that the gap between the listing price and closing price of the average home continues to get smaller. The list-to-close ratio here in Metro Phoenix is 98.2% , the 11th highest among major US metro areas. Sellers list their homes and in almost all cases have an offer to purchase with days if not hours. Even better news is that Sellers are getting their asking price or very close to their asking price. Phoenix homes spent a median 25 days on the market last year, a 42 % drop from 43 days in 2011. If you are a Homeowner, and a wanna-be Seller find out what your home is worth in today’s market. You may be pleasantly surprised. CONTACT ME SOON!! TYM2SEL 602-410-9547

 

It’s a Sellers Market in Phoenix

Homeowners who have been waiting to sell their home in the cities making up metro phoenix, this is the time to become Sellers.

It’s a Sellers Market

There are simply not enough homes for sale in today’s market to meet Buyers demand. Low inventory has been a problem over the past year.  Many would be Sellers are still underwater with their mortgages.  According to a report as many as 40% of homeowners are stuck and cannot sell their homes until the value of their home rises.

There were 12,623 Valley home listings on the Arizona MLS on Jan. 1, down 6 percent from a year earlier and far below normal supply levels, according to Arizona State University’s housing report earlier last month.

Foreclosures and Short Sales which made up the lions share of homes for sale in metro Phoenix have been snapped up by Investors.  The Valley no longer offers the best opportunities for Real Estate investors and they have moved on to greener pastures in cities like Atlanta.

Sellers Enjoy Less Time on the Market

The good news for Sellers in Phoenix is that the gap between the listing price and closing price of the average home continues to get smaller.  The list-to-close ratio here in Metro Phoenix is 98.2% , the 11th highest among major US metro areas. Sellers list their homes and in almost all cases have an offer to purchase with days if not hours.

Even better news is that Sellers are getting their asking price or very close to their asking price.

Phoenix homes spent a median 25 days on the market last year, a 42 % drop from 43 days in 2011.

If you are a Homeowner, and a wanna-be Seller find out what your home is worth in today’s market. You may be pleasantly surprised. CONTACT ME SOON!! TYM2SEL

 

Metro Phoenix home assessments up for first time in six years

Most metro Phoenix homeowners will see the first increase in their property’s assessed value since 2007 when they receive their annual statement from the Maricopa County Assessor’s Office.

The median value of a house in metro Phoenix climbed almost 16 percent during 2012 after falling 7.6 percent in 2011.

The increase won’t surprise anyone who has watched the region’s housing market recover over the past 18 months. However, the overall increase in values for Maricopa County might be confusing because the overall median price of the area’s home sales climbed 34 percent in 2012.

“Our analysis is based on both home sales and the valuations of the even greater number of houses that didn’t sell last year,” County Assessor Keith Russell said. “If a house doesn’t sell, we don’t know if it has new carpet or plumbing, but we must still do the research to assess its value.”

The overall median value of single-family houses in the county climbed to $127,000 in 2012 from $109,600 in 2011.

Statements will be mailed to Maricopa County residents over the next two weeks, with the first group expected to receive their statements as early as today. About 1.5 million properties were valued by the county assessor during 2012.

In 2010, Maricopa County home values fell 11 percent. In 2009, property values dropped 15 percent. In 2008, they plummeted 23 percent, the biggest drop of the prolonged retreat in home values. In 2007, values declined 13 percent.

The property-valuation assessments being mailed out now will be reflected in 2014 tax bills. This year’s tax bills will reflect 2011 valuations.

Despite the drop in home values in 2011, homeowners shouldn’t count on a significant drop in taxes this fall. Many Valley municipalities and school districts still face budget gaps and could raise property-tax rates again this year.

Russell said the county’s residential assessments are conservative, so homeowners can expect to sell their houses for as much as 10 percent more.

Some Phoenix-area cities fared better than others. Home values climbed the highest — 34 percent — in El Mirage and Youngtown. Tolleson homeowners saw a median increase of 33 percent. Those communities experienced some of the biggest drops in home values during the crash because of higher foreclosure rates.

Property owners can appeal valuations with the Assessor’s Office until April 23.

To appeal the 2012 assessment, go to maricopa.gov/ assessor or call 602-506-3406.

A house’s value has to decline significantly through a reassessment to lower its property taxes, which fund municipalities, school districts and more. Tax bills cannot be appealed.

by Catherine Reagor

What to expect as mortgage lending has changed

The mortgage has changed significantly since the housing crash. The easy-to-obtain loans of the housing boom are long gone. But what can the growing number of regular buyers, who need a mortgage to purchase a home, expect in this market?

Jay Luber, president of Phoenix-based Galaxy Lending, is a veteran of Arizona’s mortgage market. His thoughts and advice for borrowers:

Question: Is it difficult for a first-time buyer to get a mortgage now?

Answer: The Federal Housing Authority is a popular  with loan requirements for first-time home buyers. To adjust for lending risks, there have been some modest changes to mortgage insurance premiums. With lower FICO score requirements and low minimum down payments, FHA loans are the most popular program for those entering the housing market for the first time. In addition, 100 percent of the down payment can come from a gift.

Borrowers must furnish lenders with documentation of income and assets, including a pay stub, two months of bank statements and tax returns for those self-employed. The loan process is smoothest for those who are organized.

Q: What would you recommend for a buyer to do in order to get pre-approved for a mortgage?

A: Pre-approval for a mortgage begins with a potential borrower talking to a knowledgeable loan officer at a reputable mortgage lending company.

Potential borrowers should determine their financial comfort zone for a total monthly mortgage payment. Included are principal and interest, taxes, hazard insurance, FHA mortgage insurance premiums and HOA dues if applicable. In today’s market, principal and interest on a monthly payment is calculated at about $4.50 for every $1,000 of the total loan.

Borrowers should be prepared to talk openly with a loan officer, who will help them determine a maximum home-purchase price, looking at their desired monthly mortgage payment, income, credit history and other monthly obligations.

The loan officer will analyze the information provided, verify documentation and then issue a PQF (pre-qualification form) that a real-estate agent uses when presenting a purchase offer to a seller.

Pre-approved borrowers should not make any major purchases, such as buying a new car without first consulting their lender.

Q: Are you seeing a lot of metro Phoenix homeowners able to refinance with the aid of government programs?

A: During the first nine months of 2012, the bulk of all refinances were Home Affordable Refinance Program (HARP) loans targeted to help homeowners underwater. Borrowers who financed their mortgages after June 2009 did not qualify. I believe the majority of borrowers who could refinance under HARP 2.0 have already done so.

Now, we are seeing most refinances are conventional. As home values continue to increase, even more borrowers will be eligible to refinance at today’s low rates. In addition, jumbo financing has become more attractive and available.

Q: Where are interest rates heading?

A: As the economy continues to improve, interest rates will continue to rise modestly. I would not be surprised if by the end of 2013, rates are well above 4 percent. But those are still very attractive to borrowers.

The Republic | azrepublic.comFri Feb 22, 2013  1:30 PM

 Phoenix among best places to sell your home!!!

Homeowners may find it interesting that metro Phoenix is one of the best markets to sell a home right now — in fact, ZipRealty Inc. ranks it the 11th-best spot in the nation.

This may come as no surprise to those familiar with the local housing market. After all, home values are surging and the extremely low number of Valley homes for sale has led to a huge imbalance with more buyers than sellers, causing local housing professionals to practically beg for listings.

For instance, there were 12,623 Valley home listings on the Arizona Regional Multiple Listing Service on Jan. 1, down 6 percent from a year earlier and far below normal supply levels, according to Arizona State University’s housing report earlier this month.

Phoenix’s supply problem has been ever-present over the past year. That’s largely because, according to Zillow’s report Wednesday, roughly 40 percent of Valley homeowners are still underwater with their mortgages, meaning they’re pretty much “stuck” until home values rise -- and the foreclosures and short sales that flooded the market during the downturn have dropped dramatically in the past year.

As a result, the gap between the listing price and closing price of the average home continues to get smaller, ZipRealty said.

In Phoenix, the list-to-close price ratio was 98.2 percent, the 11th-highest among the major U.S. metropolitan areas, according to report.

That’s also right in line with the national ratio of 98.3 percent in December, which was up from 97.1 percent in January 2011.

Additionally, Phoenix homes spent a median 25 days on the market last year, a 42 percent drop from 43 days in 2011, according to report.
That’s significantly fewer days than the national median of 44 last year, which was down by only 23 percent from 57 days in 2011, the report showed.

“A limited inventory of homes on the market, combined with the extremely low cost of mortgage financing, has resulted in homes selling above asking price in many Western markets, boosting the average listing to closing price ratio,” Lanny Baker, said in the report.

“The median amount of time that homes are listed on the market before they sell has shortened by more than two weeks since last year, and in some areas we are seeing one in five newly listed homes sell in less than seven days,” he added. “Multiple-bid situations are also increasingly common in the markets we reviewed.”

Here are the 20 markets with the highest list-to-close price ratios:

  1. San Francisco: 102.5%
  2. San Diego: 101.3%
  3. Sacramento, Calif.: 100.9%
  4. Las Vegas: 100.7%
  5. Los Angeles: 100%
  6. Orange County, Calif.: 100%
  7. Denver: 99.8%
  8. Tucson: 99.3%
  9. Portland: 98.9%
  10. Seattle: 98.3%
  11. Phoenix: 98.2%
  12. Dallas: 97.8%
  13. Richmond, Va.: 97.8%
  14. Northern Va./Washington: 97.7%
  15. Raleigh, N.C.: 97.4%
  16. Baltimore: 97.3%
  17. Tampa, Fla.: 97.2%
  18. Miami: 97.1%
  19. Houston: 97.1%
  20. Nashville, Tenn.: 96.9%

Kristena Hansen

Reporter- Phoenix Business Journal

 

 

Amazing! 31% Price Increase in 2012 has ZERO Impact on Inventory!

In mid-January 2013, the total supply of single family homes listed for sale is 15% LESS than it was at the same time last year!

How the heck can prices go up 31% and supply fall 15%!  According to economic theory, higher prices are supposed to make people more willing to sell their houses, not less.

It’s amazing that the number of new listings hitting the market in December 2012 was the lowest for any month since December 2001 when the real estate market was still reeling from the 9/11 attacks.

The real estate market usually has huge lag times between cause and effect, 1 to 2 years is not at all unusual.  That means we may not see inventory increase in response to the higher prices until next fall or winter!

Phoenix Median Home Price to Increase Strongly Again in Spring 2013

I’m thinking this afternoon that the median home price in metro Phoenix could rise from its current $163,500 (December 2012), to $190,000 to $200,000 by June.

This doesn’t mean your personal home will increase that much, different zip codes appreciate differently. 

Keep in mind, although your current home is appreciating rapidly, if you plan to sell your current home and buy another home, that the home you want to buy is appreciating rapidly as well.

 

 

Reasons to list your home!

Some Homeowners worry more about the commissions than the reasons below. Please take the time to understand that some agents do spend the time to get the exposure your home deserves. These are some of the reasons to consider listing your home, you will also need to find a Real Estate Agent that you can work with, and that will make the sale of your home a priority.

Top Ten Reasons to List your Home

  • Safety: Posting your phone number on signs, can let strangers know when you are not at home. Inviting people you know nothing about into your home can be dangerous. Agents know something about the people they are showing your home to.
  • No advertising costs to seller: All advertising costs and marketing costs are absorbed by the listing agent. The listing agent is only paid when your home sells.

  • Tax Deductions: Commissions are Tax Deductible, ask your accountant.

  • For Sale by Owner's Sell for less than listed homes: This will usually pay the Agents commissions!

  • Not at home? Off the Market: For Sale by Owner's homes are only on the Market when the owner is home. No one can be home all of the time!

  • Multiple Listing Service:The exposure your home get with MLS. Your home gets viewed by agents, already working with preapproved buyers.

  • Investment: Often a person's largest investment is their home, and should be treated as such. Investments of this kind should be protected with the use of a professional.

  • Buyer's Agent is not yours! Buyers May have an agent and be represented: the buyer's agent would only have the buyer's best interest in mind and you could be left unprotected!

  • Errors in Paperwork: Errors in paperwork and disclosure issues with the buyer, can cost a For Sale by Owner. In this sue-happy world, a buyer can easily become unhappy.
  • The Burden of Making Yourself Available: Every time your home is viewed and the burden of all of the paperwork and legal issue's, would be taken on by the listing agent.

Have you been wondering why you should list your home? I thought this may help, this is just a list of the top ten reasons to list your home. There are many other reasons also, in todays market selling a home can be difficult. It needs exclusive exposure online too. If you or someone you know are interested in finding an agent who will take the time to sell your home and offer great internet exposure in the Phoenix Metro Area feel free to give me call. I would be honored to help you Protect your Investments.

 

5 Signs the Market is Recovering Fast

 Confession: I cyber stalk real estate agents. I watch your Facebook statuses. I read your tweets, likes and shares. And, from time-to-time I even scan your Spotify feeds to figure out what new artists I should check out.

Why? Well, not because agents have the best taste in music (though I have seen some pretty good tracks on your playlists…)

The truth is, over time I’ve found that if you really want to know what’s going on in the real estate market, all you have to do is watch the conversations agents are having.

Recently, my cyber observations have made me feel like we’re in the dead heat of a market turnaround. It seems like agents are feeling better, doing more business, and generally positive about the market prospects in the year ahead.

But, I had to ask: is this anecdotal recovery I’m feeling real? And if so, where are the signs?

Here are six answers I found that support the notion that things are looking up for the real estate industry.

Take a look, share them, blog them, and shoot me a comment in the box below to let me know what signs of change (if any) you’re seeing in your area.

1. Both asking price and rents jumped 5 percent from last year

Trulia’s latest Price and Rent Monitors showed a big boost in asking prices across the U.S. – up 5.1 percent year-over-year. This a drastic change from the double digit declines of previous years.

The relevant news for your buyer and seller prospects isn’t just that home prices are climbing, but that renting is getting more expensive as well. The statistics showed rents are up 5.2 percent year-over-year.

If you understand supply and demand, it’s obvious that these two facts point toward more real estate moves happening, and that consumers have gotten over the angst of previous years and shifted into the “recovery mindset.”
2. Mortgage rules got a renovation.

Predatory lending practices linger near the top of many economists’ blame lists for the most recent market decline.  And, after years of fallout from bad mortgages, capable buyers have been, understandably, slow to purchase.

For those buyers who’ve been anxious about the mortgage process and skeptical of the predatory lending, this Thursday brought great news and a sure “go” sign for them to jump into the market.

Thursday the Consumer Financial Protection Bureau released it’s new mortgage guidelines which are “a set of standards that protects consumers from bad loans” according to David Stevens, CEO of the Mortgage Bankers Association.

The new guidelines show that banks and the government are working out their differences to create a safer, more secure environment for homeowner hopefuls. In addition, the new guidelines give those buyers access to mortgage best practices upfront to help them ensure they’re ready for application and ownership from the start.

3. Delinquency & foreclosures are at record lows.

Declining delinquencies aren’t just fluffed headlines, the numbers support what it seems many agents are feeling.

Delinquencies are down. According to Trulia’s Chief Economist, Jed Kolko, “ In November, 10.63% of mortgages were delinquent or in foreclosure, down a hair from 10.64% in October. The combined delinquency + foreclosure rate is at its lowest level in four years and is 41% back to normal.”

These stats are good news for buyer’s agents whose clients and prospects need a boost of confidence.

4. 93% of Millenials plan to buy.

Last quarter  released  The American Dream Survey and one of the top facts from our study showed that 93 percent of current millennial renters plan to buy.

This is good news for an industry that’s suffered from years of skittish home shoppers and a lot of talk about home buying no longer being a part of the American Dream.

5. Investors rush in.

Another sign that we’re on the way to a high-paced recovery is that investors are making major moves to capitalize on today’s opportunity.

A recent story from Bloomberg covered how Blackstone Group, the largest U.S. private real estate owners, sped up it’s purchases of homes to try to beat out fast rising prices.

This is a sign for on the fence buyers to start their hunt before the weather heats up and they face more competition than they can handle.

These are some of the national signs that show the recovery is well under way. Comment below and tell us what you’re seeing, reading, and witnessing in your local market.

 

THERE WILL BE A LOT OF PEOPLE GLAD TO HEAR THIS...
 
Mortgage Debt Relief Act Receives Much-Needed Extension

Struggling homeowners can breathe a sigh of relief knowing that Congress has included an extension of Mortgage Forgiveness Debt Relief Act in an eleventh hour bill to avoid a possible fiscal cliff crisis. The Act that was scheduled to expire on December 31, 2012, was extended in the American Taxpayer Relief Act until December 31, 2013. Don Faught, the president of the California Association of Realtors, credits realtors in the association for their role in advocating for this extension of the Mortgage Forgiveness Debt Relief Act.

This relief will benefit homeowners who received mortgage debt forgiveness as a result of a reduction in principal, foreclosure, short sale or deed in lieu of foreclosure. Under the United States Federal Tax Code, any debt that is forgiven, including mortgage debt, is treated as income and, therefore, subject to income tax. As the expiration date drew near, homeowners rushed to complete short sales before the end of the year to avoid tax on the difference between their mortgage debt and the sale price. For many, this tax would have been thousands of dollars. By extending the Act, homeowners will not have to pay income tax on mortgage debt forgiven up to two million dollars. Please check with your tax professional for all applicable scenarios as not all mortgage debt is subject to the Mortgage Forgiveness Debt Relief Act.

This extension is especially important to underwater homeowners, who owe more for their home than it is worth. Short sales have enabled them to avoid foreclosure; however, already struggling homeowners with no equity in their homes would have faced significant difficulties paying income tax on their forgiven debt. Homeowners who are able to avoid foreclosure by receiving a loan modification that includes a principal reduction will also benefit.

The American Taxpayer Relief Act of 2012 also extends the exclusion of capital gains tax on principal residences. Single homeowners will be able to exclude up to $250,000 when they sell their home, while married couples will receive a $500,000 exclusion.

While there has been some decrease in foreclosures and home values are slowly rising, the crisis is far from over. Therefore, supporters are already advocating to extend the Act beyond 2013 in order to avoid another urgent attempt to protect homeowners and help stabilize the housing market.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

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