Tag: tips

Title insurance is one of those additional costs of purchasing a home that, unlike many other fees, is actually optional. Most people don’t want to deal with additional fees and ignore title insurance. That’s not necessarily a good idea. If you can afford to pay the fee, it’s a good investment.

There aren’t very many options available for homebuyer protection, and title insurance is one of the best. Title insurers have the best access to records and most experience detecting problems of any form of homeowner protection. Fraud is on the rise in the electronic age, and title insurance protects the homeowner from both fraudulent claims and losses. You may also not realize that title insurance, unlike most forms of insurance, is just a one-time charge. You won’t be saddled with monthly or annual payments.

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When budgeting monthly costs, homeowners generally take into account mortgages, real estate taxes, and homeowner’s insurance. Unfortunately, they all too often forget about maintenance and repair costs. It’s a good idea to set aside 1-3% of the home’s value for repairs and maintenance. You may not always know when you need repairs, but you do need to be prepared to pay for them.

Regular maintenance can also help lower the costs of repairs. Major repairs are less likely to be necessary if you can catch problems before they get too big, and you’ll probably end up paying more for even a single major repair than for regular maintenance and minor repairs across the year. A few things you should do every month are check HVAC filters, look for water leaks, check the vent hood in your kitchen, ensure carbon monoxide and smoke detectors are operational, and look for cracks in the foundation. All of these can be done yourself, and if there’s no issue, you don’t need to pay anything.

Here in California, we don’t have much in the way of seasons, but there are still certainly cold or rainy areas of the state. If your area freezes in the winter, look for ice dams on the roof, inspect for gaps under doors and windows, and consider protecting your AC unit from snow and ice if necessary. Your windows and doors should also be inspected during the spring, if your area gets a lot of rain. You should also get your HVAC and roof professionally inspected. Take care of any clogged gutters as well.

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On average, the smaller a home, the less expensive it will be. So you’d think that buying a tiny home — one under 600 square feet — is going to save you a lot of money. Well, that’s only true if you’re looking at just the total purchase price, which is $52,000 on average. That’s 87% less than the average price of a typical home. However, most tiny homes are actually significantly smaller than 600 square feet, averaging only 225 square feet. This makes them about 62% more expensive per square foot than your typical home.

Of course, price per square foot only matters if you actually need the square footage. But at only 225 square feet, you probably do. For comparison, the typical bedroom is about 132 square feet — more than half the size of an average tiny home. Even the smallest of kitchens is usually just over 100 square feet. That leaves absolutely no room for storage, and you’re going to need to do your laundry at a laundromat. Many tiny homes are also completely off-grid and may even lack a sewage system and utilities. Not only is this highly inconvenient, the expenses can rack up, and they’re costs you aren’t likely to be able to easily recover by selling the home later.

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More: https://www.cnbc.com/2021/08/18/tiny-homes-can-mean-big-costs-especially-depending-on-where-you-live.html

Everyone knows college is expensive. Tuition costs aren’t the only reason. Room and board can also be rather expensive. In fact, it’s quite possible that it would be more than the mortgage payment on a new house. That means it may actually be financially beneficial to just purchase a house for your college kid, instead of sending them to the dorms or campus apartments.

Of course, this depends on multiple factors. Of course you’ll need to take into account the actual cost of room and board as well as expected mortgage payment for the property, but there are other financial considerations as well. You’ll need to be able to afford a down payment, first of all. Are you able to turn it into a profit opportunity by renting out some of the rooms? If so, do you need to hire a property manager? Once your kid graduates, are you going to keep the house for them, sell it, or continue to rent it out?

There are additional considerations that aren’t necessarily even financial. How far away from your kid do you want to live? Maybe you should consider moving with them, if that’s a possibility for you. Is giving your kid the responsibility of owning a house a good learning opportunity for them, or is it just going to result in disaster? Are you sure that they will continue at this school, or is it likely they’ll either drop out or transfer? This option certainly isn’t for every family, but it’s a strategy that most families don’t consider.

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More: https://www.bankrate.com/real-estate/q-and-a-jeffrey-decatur-re-max/

If your home is a bit on the smaller side, it may start to feel cramped once you get all your furnishings and decorations in. You also can’t forget to leave space open for people to walk though. There are a few solutions that can help you make the most of your space without hyper-focusing on space efficiency.

The first is a huge one — decorative storage space. This serves dual purposes by getting clutter off the ground and into a more compact area, without sacrificing aesthetic. You can find both functional and appealing furniture such as ottomans or coffee tables that feature hidden drawers to store things such as the TV remote, coasters, or a few books. Speaking of books, that doesn’t have to be the sole purpose of a bookshelf; it can be used to store any manner of items.

You shouldn’t exclusively focus on ground-level decoration, though. Decorate vertically to save room for foot traffic. These can be things such as paintings, photos, or tapestries, but they can also be functional, such as wall-mounted cabinets, or bookshelves that are tall rather than wide.

Another thing you can change to make your home feel larger doesn’t actually affect your space at all: color. Lighter colors give an illusion of airiness that can make even a small space seem less cramped. Painting every room white or beige, or even light blue or yellow, may not be the best idea unless you don’t have very many rooms. But you can still achieve the same effect by using furniture or décor in lighter colors.

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If you’re struggling in the current competitive market, you may want to consider buying a new construction home. This isn’t going to be for everyone — new constructions are often more expensive and also come with additional up front costs, since it usually requires a 3% building deposit. Not to mention if you’re not hurting for money, competitive markets are going to be less of a problem for you. Still, if you play your cards right, a new construction home could be a great deal for you without much hassle, and is a much better investment later down the line as well.

Don’t be afraid to negotiate on a new construction home. It’s true that in a competitive market, you may be inclined to bid high to get the best chance at your offer being accepted. New construction is a much smaller market, and your chances are still good even if you bid lower. Alternatively, many new construction negotiations revolve around not price adjustments, but rather the construction materials and appliances. You still want to get ahead of the competition, though; builders aren’t as willing to make drastic changes if they’ve already sold multiple similar homes in the same neighborhood with their default materials.

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Everyone wants their bathroom to be a place of comfort with a calm atmosphere. If you’re planning to renovate your bathroom before selling, or just want your guests to feel at home, consider current trends in bathroom design.

There are a few trends popping up recently. The new thing for sinks is the floating vanity. It’s not actually floating — it just may look like it is, since it’s sitting on top of a raised shelf instead of a large cabinet or a tall pillar. Thematically, nature is in. Botanical wallpaper, colorful flowers, bright leaves. And for those of you who want your bathroom to be your own private sanctum, and aren’t planning to show it to others, you can customize floor or shower tiles with your own prints.

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Sellers do a lot of things to get their homes ready to show. Tidying messes, repainting walls, fixing deferred maintenance, getting their homes professionally cleaned, hiring photographers or videographers, and sometimes staging their home. What many of them forget to think about is the outside of their home. This is a huge mistake, as the outside is the first part of the home a prospective buyer will see when they arrive.

The first thing you should do is clear the area of objects lying around such as tools or toys, so that you have a clear space to work with. If you have a garden, remember to tend to it by removing weeds and pruning plants, or even getting fresh new plants. Be sure to replace mulch as well. If you have a lawn or shrubs, make sure they’re trimmed. Make sure your sprinklers are working and angled properly as well. Clean out your pool if you have one. Once everything is cleaned up, make sure to sweep any clippings and debris and wash down the driveway and walkways.

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There are three primary ways to resolve disputes in business transactions, including real estate transactions: arbitration, mediation, and litigation. Arbitration involves no court activity at all except in choosing a neutral third party, and in fact courts must abide by arbitration even if the decision is erroneous. Mediation is similar to arbitration in that the initial decision is not made by the courts, but it allows to courts to intervene if a resolution is not found. Litigation involves a lawsuit in court.

Historically, businesses have favored arbitration since it was considered the quickest and cheapest method of dispute resolution, and having an arbitration policy protects them from many lawsuits. Now, businesses such as Amazon are quietly changing their policy. Arbitration has turned out more costly than they expected — primarily because they’ve been losing the disputes, in which case they are required to pay both sides. It’s also not always quick. And when the businesses are losing, they’re also not too hot on the decision being legally binding despite not necessarily being legally correct. Instead, mediation is turning out to be a cheaper, fairer, and sometimes quicker method of resolving customer disputes.

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More: https://journal.firsttuesday.us/industry-leaders-are-cutting-arbitration-provisions-and-they-arent-needed-in-real-estate-either/79078/

As more and more employers are considering the possibility of permanent work-from-home, homeowners need to think about ways to create dedicated office space in their home. Of course, if you can afford it, you can make an addition or even just buy a larger home. But not everyone can afford that, so for those who can’t, here are some ways to turn existing space in your home into office space.

For most jobs, a home office needs a desk. But a desk is just an elevated flat surface — it doesn’t have to look like an office desk. You can use a simple table or even just the shelf of a cabinet. You can also just use your dining table. You probably aren’t eating dinner while working. Other types of rooms can also become split-purpose, such as a guest bedroom. If you don’t have guests over — which you probably don’t during a pandemic — you’re free to use it as your office space whenever you want. Even if it’s occupied during the night when your guests are sleeping, you can still get work done there during the day. If you want to get creative and aren’t too spooked out, you can also turn your attic space into a home office with a table and proper lighting.

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Many people try to reduce their energy bill by limiting their usage. While this will indeed reduce your bill, it also reduces your comfort. There are better ways to save money on energy bills without sacrificing anything. All these ways cost money, but the investment is worth it to save money over longer periods.

A couple things you can do are one-time investments that will continue to pay dividends. These are both simple modernization. Incandescent bulbs are largely outdated, and should be replaced with LED bulbs, which are more energy efficient and last longer. Expect to save around $75 per year. Smart thermostats are the other one-time investment that will work wonders to save you money. Your HVAC doesn’t need to be working when you’re working, and it can sleep when you’re asleep. A smart thermostat lets you manage that without much effort.

The other way to save money may need to be redone periodically, but it’s still worth it. That’s just simple routine maintenance. Not only does routine maintenance reduce the likelihood of needing to pay gigantic repair costs further down the line, but it can actually improve efficiency even if no repairs become necessary. Clogged HVAC filters won’t stop it from working, but they will make it work harder and expend more energy. The other type of maintenance you may not think of is sealing leaks. Up to 20% of the money you spend on heating and cooling may just be flowing out of small cracks near doors, windows, lighting units, and chimneys. Trapping the air by sealing these leaks with caulk will reduce stress on your HVAC unit.

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In order to understand what a stepped-up basis is, first you need to know what a basis is. Basis in real estate is essentially the value of a home discounting any effects of appreciation or depreciation, and is used for tax purposes. It’s calculated as a property’s cost when it was purchased plus the value of any improvements made to the property. When determining the amount of taxable capital gains when selling the property, this is the amount subtracted from the sale price.

Where stepped-up basis comes in is in the case of inherited properties. When a property is inherited, the basis is recalculated based on market values, ignoring both the purchase price and any improvement values. It’s possible that this stepped-up basis causes your capital gains amount to be negative, in which case this can be deducted from your taxable income if it is not your primary residence. Only up to $3000 can be deducted in this way per year, but you can continue to deduct in later years until the loss is settled. The estate can choose to use the market value on either of two dates: the date of the previous owner’s death, or six months from that date, called the alternate valuation date.

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The best way to turn a profit through real estate is with investment property. Flippers certainly wouldn’t do what they do without some return on investment, but the return is much greater if you’re keeping the property and renting it out. Of course, not everyone can afford to make that type of investment, but if you can, these tips will help ensure you do it right.

It should be obvious that your bottom line is important, so make sure to take a look at average rent values in the area where you’re buying. If it’s not enough to cover whatever your costs would be, look elsewhere. Also keep in mind vacancy rates; investment property won’t bring in any money if the properties are all being left unoccupied. The second factor is location. You can change a lot about a home through renovating or even demolishing it and rebuilding, but what you can’t change is where the plot of land is. The properties with the highest rental values tend to be in areas near good schools, recreation, and public transport, that are quiet and have a low crime rate. The final thing to look for depend on current trends, so be sure your information is up to date. Short of demolishing the home, it’s quite difficult to change a property’s overall floor plan. By contrast, peoples’ floor plan preferences do change over time. A home with a modern floor plan is most likely to be well received by tenants.

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If you’re looking for a place that is affordable yet in a nice neighborhood, look no further than neighborhoods that are up and coming. The process of gentrification significantly increases an area’s desirability, but unfortunately also significantly raises prices. Areas that have just begun this process, though, are probably still inexpensive.

There are a few things you can look at to determine which neighborhoods are in this category. Two of them involve correlations with hard data that you can access from professionals. The city’s municipal office can provide information about building and renovation permits. A high degree of activity in either of these, but especially renovation permits, implies that the neighborhood is about to become more expensive — but isn’t yet. The other statistic to look for is days on market. Slowly dwindling days on market is a precursor to a highly desirable neighborhood. If this is information you’re interested in, just call or email us, since as your real estate agents, we can help you track it so you can grab the best deals before it’s too late.

The third way to find blossoming neighborhoods may take a wider social network, since it’s not easy to just find the data. This way is to figure out where the young, creative types are going. Young adults and all types of artists generally have lower income and will be looking in cheaper areas, but also seek out trends and will want to know what areas are becoming more popular. In addition, creativity gives neighborhoods a type of personality that strongly attracts multiple kinds of buyers.

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The first thing anyone is going to see when looking at a listing is the photos. People aren’t going to be interested if there are no photos. But that doesn’t mean you can just take snaps with your phone’s camera and toss them up there, even with some editing. The fact of the matter is that no one is going to come see your property if it looks terrible in the photos. In addition, while there are plenty of photography tricks to improve the appearance, no one is going to buy your property if it looks significantly different from the photos.

That’s where professional photography comes in. Professional photographers know how to manipulate not the photographs themselves, but the camera settings and lenses, angles, lighting, and even which aspects of your home to highlight. None of these are making false promises. Rather a professional will find the best way to make the truth of what your home is stand out to buyers. Good panoramic shots require a specific type of lens. The colors of your home influence what time of day and which flash settings will provide the best lighting. Pros will seek out intricate details and unique features that make your home stand out from the competition.

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It’s pretty obvious that when you’re looking for a home for yourself, you’ll want to do plenty of research and scrutinize all the details. But when people are making investment purchases, their bottom line is often the only thing they look at. That’s not a good practice — there is definitely research to be done before deciding how to invest.

First you’ll want to decide whether or not this actually is just an investment property, or there’s a possibility you’ll want to live there in the future. If you have long-term plans, you’ll certainly want to consider much more about the property than your bottom line. Multi-family residences are generally higher income, assuming all or most units are rented out, but most people would prefer to live in a single-family residence.

Even monetary considerations don’t stop at the buying and subsequent renting of the property. Make sure that any necessary repairs are within your budget. Whether your plans are short or long term is also important here; it may be okay to take a loss early if the rental income over time is going to make up for it in the future, but you don’t want to buy a fixer if you want to see an immediate return on investment. The bottom line also doesn’t tell you whether you are going to get an income at all. If no one wants to rent in the area where you’re buying, it’s going to remain vacant. Look at crime rates and school ratings for the area. Crime rates are especially important, since even if you manage to get a tenant in a high crime area, you don’t want to suffer the losses even if you aren’t the one living there.

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