5 Factors That Influence Your Home’s Resale Value

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While home sellers hope to get top dollar for their property – and some have an inflated idea of what to expect – establishing a home’s value can be a complex, multifaceted process. Do home renovations really pay off? And which is more valuable: a three-bedroom or a four-bedroom with the same square footage? We talked to real estate insiders to find out.

1. Location. The classic real estate refrain says, “location, location, location.” Location includes factors such as the price of recent nearby transactions, the quality of local schools and whether the area has a strong sense of community. “Buyers increasingly value community in the community where they’re buying,” says Amy Anderson, an agent with Davidson Realty, Inc. in St. Augustine, Florida. “They come to me not looking for a house for four years, but focusing much more on the community, the activities and the school district.”

As Americans scale back their dependence on automobiles, some homebuyers seek out communities that don’t require cars to get around. One resource is WalkScore.com, which rates neighborhoods throughout the U.S. based on access to public transit and proximity to grocery stores, parks and more.” I think walkability has become more important in many markets, especially amongst millennials,” says Ken Wilson, president of the Appraisal Institute, a professional association for real estate appraisers, and founder of Wilson Realty Advisors in Dallas. “You’re also finding empty nesters that are looking into properties that have walkability.”

But as Zillow.com chief economist Stan Humphries points out, location encompasses many other considerations. “Does it have a view? Is it a waterfront home?” he asks. “What’s it next to? Is it near retail establishments? Or a highway?”

2. Size and layout. While homebuyers used to swoon over ample square footage, many have fallen out of love with the McMansion. “I think people realize when they buy a 3,300-square-foot house, they’re not getting what they thought they were,” Anderson says. “There’s more upkeep and a lot more involved with taking care of these huge houses.”

Layout is a key factor because an open-concept design can look much more spacious than a boxy space of the same size. The number of bedrooms also influences a home’s value, so think twice before putting up a wall and subdividing one room into two. “Adding a bedroom will take away value,” Humphries says. “Fewer but larger bedrooms tend to boost value.”

3. Age and condition. Historic homes (assuming they’re livable and well-maintained) and new homes are typically more valuable than homes built somewhere in the middle. “Generally, as a home gets older, it becomes less valuable,” Humphries says. “Then there’s a U-shape where, at some point, homes become so old that they have historical significance. A home that’s built in 1910 is probably more valuable than one built in 1970.”

Age aside, condition matters too. “Someone will pay $15,000 more for a well-kept house that’s move-in ready than they will for a house that needs $5,000 worth of work,” Anderson says.

4. Upgrades. Renovations play into a home’s value, but if your home is considered “over improved” compared with other properties in the neighborhood, it can actually hurt the property’s value. “You want it to be common for the neighborhood or subdivision,” Wilson says. “It wouldn’t hurt to visit neighbors’ homes or visit a home via an open house to see what people are marketing [before undertaking big improvements].” You could also hire an appraiser to prepare a feasibility analysis that will help you determine the impact of renovations on your home’s value.

Unless you live in an area where granite countertops and built-in wine fridges are the norm, Humphries says you might be better off saving the money and choosing more basic finishes. “It’s harder to recoup [your investment] if you guild the lily, if you will, on granite this and chrome that in your kitchen,” he says. “You’re spending a lot of money on something that might have a lot of personal taste attached to it.”

However, you should keep records of repairs and upgrades to show potential buyers that the home has been well-maintained.

5. Negative events. If your property has issues like mold or experienced a fire or was the site of a violent crime, it could be a harder sell – and command a lower price. “Nowadays, people are very concerned if there was a fire, prior mold damage or even if there were some sort of death or crime at the property,” Wilson says. Federal law requires the disclosure of all known lead-based paints, but state laws vary in whether the seller must disclose issues related to natural disasters or crimes committed on the property.

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Why You Should Store Your Jeans in the Freezer

BY VICTORIA DAWSON HOFF AND LAUREN LEVINSON

We’re all too aware of the perils of washing a great pair of jeans. Even with the typical tricks (turning the jeans inside out; laying them flat to dry), there’s no guarantee that the laundry cycle won’t transform your flawless dark skinnies into faded, spray-on jeggings. Considering the trials and tribulations usually involved in finding said perfect pair, gambling your hard-earned money with the press of the “start cycle” button seems a bit unfair. And the alternative—letting them go unwashed until they’re so “loved” that they basically stand up on their own—might not fly in civilized society.
“There has to be a better way!” we told ourselves (in our best infomercial voice), and, thankfully, the denim experts at Levi’s promptly heeded our call. Not only did VP of Women’s Design Jill Guenza have a quirky, genius, wash-free tip for our dirty denim problem, she did us one better and told us how to hack that freaking laundry cycle once and for all. Read on and see: There really is hope for your beloved pair.

Why does denim start to smell?
It’s funny: I was just on the internet to do some cursory research before this interview, and according to the Smithsonian page, it is because there is bacteria that sloughs off of our skin as we wear the jeans. The bacteria transfers with the sloughed-off skin cells onto the denim and apparently the bacteria is what is causing the odor. A lot of the reason why people don’t wash denim is because the beauty of indigo is that it wears down—the blue pigment from the indigo chips off and creates almost like a living document of your life in your body as you move through your days. You can create these really personal wear patterns if you wear your jeans from [when they are] rigid, which is what we call the raw state of denim. So as you are wearing the jeans, the skin cells transfer from your body to the jeans and that can cause odors.
I have tried this myself: I regularly freeze my jeans, and I know that according to some scientists, when you freeze your jeans it might kill a lot of the bacteria—certainly not 100 percent of them, but a good portion of them—and then when you pull them out of the freezer they don’t smell anymore. But you have to let them warm up a bit otherwise they are really cold! As you wear them again, the bacteria can begin to grow again, but you can continue to freeze them; I would say once a month is sufficient to keep them from really smelling.
Why does the freezer get rid of the odor?
The lower temperature kills the bacteria. But it is not 100 percent. The only way to truly do that is either to wash your jeans or to sterilize them at a really high temperature, but that defeats the purpose of really sustainably cleaning your jeans—because your freezer is running anyway, so it is a good trick to save energy! But also, washing your jeans washes off a lot of the indigo too and you lose a lot of the rich look you get when you don’t wash your jeans.
What kind of bag should you use?
I just throw them in the freezer!
Levi’s come in canvas bags. Would the bag itself do anything, or should we just put them right in?
I’ve never personally tried the canvas bag, but I think that is a way to protect your jeans from whatever else is in your freezer while still allowing oxygen. It allows the bag to breathe and get to your jeans so your jeans can breathe, as opposed to putting them in a Ziploc plastic bag. I think you want to let them air out.
How long should you leave them in the freezer for?
Overnight is fine.
Another issue with washing jeans is that they stretch out. Does the freezer have any shrinking abilities?
The freezer won’t shrink your jeans; it won’t bring your jeans back into shape. A trick for that is to turn them inside out and throw them in the dryer without washing them. If you are wearing stretched jeans, that will kind of bring them back into shape.
How long should you throw them into the dryer for, and on what heat?
Again, the idea is to reduce the amount of energy you are using. I would say if you are drying another load of laundry, you can toss them in for the last 20 minutes of the cycle at regular heat.
Any other jean washing or care tips?
I am a huge proponent of the no wash, stick in the freezer, and put in the dryer to retain the shape. But one other trick that I’ve picked up along the way is if you are wearing your jeans in from rigid, you can give them this really beautiful sheen if you put baby oil on your legs first before putting on your jeans, because the baby oil, wear after wear, will transfer from your skin, and a certain amount of it will be absorbed by the denim, and it creates this beautiful sheen.

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Fixing Up Your Home? Here’s What Pays

— By CNBC’s John Schoen
Posted 14 April 2016.

 

As the spring real estate selling season gets in gear, some houses are moving faster getting better offers than others.

Apparently, a lot depends on a short list of key features that home buyers favor in local markets around the country, according to e recent analysis from real estate site Zillow.

After searching for 60 keywords in more than 2 million listings, Zillow researchers found that some of the most popular features helped boost the final sale price and shorten the time a house was on the market. For homeowners considering making improvements, the analysis offers some insight into which upgrades generate the best returns. A listing that included the phrase “new carpets,” for example, had no effect. But “hardwood floors” boosted the sale price by two percent more than expected.

Here are the other features that buyers favored, and the local markets where those features are most popular:

  • Granite Counters -Granite counters are popular across the country. In Dallas, that phrase in a listing helped sell a house 38 days faster than average at a 4 percent premium to the expected price
  • Stainless Steel– When it’s time to replace old appliances, the higher cost of stainless steel may be worth it when you sell your house in Chicago. Listings with that phrase sold 42 days faster than average at a 4 percent premium.
  • Exposed Brick– Exposed brick is hot in New York City. Homes that listed that feature sold for a 5 percent premium.
  • Quartz– Quartz is a popular material for kitchen countertops in Los Angeles. Those listings sold for 6 percent more and 50 days faster than expected.
  • Subway Tile– In Philadelphia, homes that listed “subway tile” sold 63 days faster than average at a 7 percent premium.
  • Farmhouse Sink– Farmhouse features are big in Los Angeles, too. Homes with a farmhouse sink in L.A. sold for nearly 8 percent more than expected, and 58 days faster than average.
  • Shaker Cabinet– When it’s time for a kitchen makeover, you can spend a lot of time trying to choose a cabinet style. In Los Angeles, home shoppers seem to prefer the Shaker style. Listings with that keyword fetched a nearly 10 percent premium.
  • Barn Door: Never mind the barn, home buyers in Phoenix apparently like the look of a barn door — inside the house. Homes with this feature sold 57 days faster than average, and the sale price was more than 13 percent higher than expected.
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Advantages to Buying a Home With Cash

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Buying a home with cash has definite advantages in today’s market. National Association of Realtors® research on cash sales shows that about 30 percent of residential sales are cash transactions. Among investors and international buyers, more than 70 percent of properties are bought outright. If you can afford to buy up front, the advantages are many:

  • Sellers are likely to favor buyers who can pay in cash.
  • The home price may be reduced for those who pay in full up front.
  • All-cash purchases streamline the home-buying process: No loans means less paperwork and no delays for mortgage approval.
  • Cash buyers can save money on closing costs, bank appraisals, mortgage applications and fees, title insurance, and so on.
  • Cash purchases eliminate the risk of loan denial.
  • Cash buyers pay much less for their homes in the long run: No loans means no interest.
  • Cash buyers never have to worry about losing their homes because they can’t afford to repay their mortgage loans.
  • Cash buyers gain full, immediate equity in their home.

Financially and emotionally, paying with cash benefits the home buyer.

Sellers prefer cash buyers Home sellers generally prefer quick, smooth sales. They know that even buyers who have been preapproved for mortgages might be denied by the lender later on. For example, a buyer who is an independent contractor might have difficulty proving two years of regular employment, or a buyer depending on a family member for a personal loan might later opt out (or the relative might). Therefore, when possible, sellers prefer to steer clear of buyers who have to apply for a mortgage. If you are buying with all cash, you have greater negotiating power on price, closing time, repairs, and more. Sellers are often willing to reduce the house’s price for cash buyers.

Cash purchases avoid the risk of low appraisals Home appraisals are notoriously fickle. Lenders determine a home’s worth by weighing it against comparable sales — other homes in the neighborhood that may have sold at low prices for unknown reasons. A low appraisal could lead the lender to reduce the amount of the loan offer, even after seller and buyer have agreed on a price. If the loan amount comes up short, the buyer often cannot afford to buy the home. All-cash buyers sidestep mortgage applications, avoiding the need for a potentially deal-breaking home appraisal.

Cash purchases save money and time Indisputably, cash purchases carry lower costs. Mortgage interest on a 30-year loan can double or triple the original purchase price. Additionally, closing costs are significantly lower when purchases are made with cash. Cash purchases also save buyers valuable time, eliminating the need to gather elusive documents and search for the optimal lender.

Peace of mind is priceless Most importantly, all-cash purchases bring an inviolable sense of security. Owning your home outright means never having to worry about covering your mortgage. In the face of disaster, such as job loss or injury, full ownership eliminates the risk of losing your home to foreclosure. Moreover, if you have paid cash, you will have excellent equity in the house. In case of financial emergency, you can draw on that equity for quick cash.

Figure out how to pay in cash  Buying your house with cash might seem like an impossible dream. Here are some tips to help you achieve it:

  • Set aside unexpected windfalls, such as work bonuses or inheritances.
  • Lock money in a long-term CD to earn interest.
  • Once you have accrued cash, look for a house you can afford without borrowing extra money.
  • Consider moving to a less populated area, further from a big city, where home prices are likely to be lower.
  • Avoid the temptation to waste money. Tell your friends and family about your goal of buying a home; they will help keep your spending on track.

 

Information above can be found on www.Realtor.com

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Buying a Home? 10 Financial Things You Shouldn’t Do

You’ve decided to buy a house, and you need financing. Even if you have good credit, you should keep your finances shipshape until closing so that lenders won’t think twice.

Here are 10 things to avoid while you’re buying a home:

1. Don’t change your job before applying for a home loan. Also, now is not the right time to become self-employed or to quit your job. You want to show lenders stability, which means you’ll be less likely to default on the loan.

2. Don’t change banks. As with your employment, you want your banking history to show stability.

3. Don’t buy a car that you have to finance. Buying a vehicle or any other form of transportation through a loan increases your debt-to-income ratio, and loan officers don’t want to see that.

4. Don’t buy furniture on credit before buying your house. Charging big-ticket items increases your debt-to-income ratio. Save your money for the down payment.

5. Don’t be late on your credit card payments or charge excessively. You need a track record of responsibility that shows you can manage your money.

6. Don’t make large deposits into your bank accounts. Lenders like it when the money for your down payment has been sitting in your account for at least two months – what they call “seasoning” – so that the funds don’t just appear out of the ether.

7. Don’t lie on your loan application. Sounds simple, right? But don’t leave out any debts or liabilities or fudge your income. It’s fraud.

8. Don’t co-sign a loan for anyone. Even if you’re not making the payments on that loan, co-signing increases your debt-to-income ratio.

9. Don’t apply for new credit cards or prompt any other inquiries into your credit rating. Looking for new credit translates into higher risk for lenders. If your inquiries are related to your mortgage search, that usually doesn’t affect your credit score, because lenders assume that you’re rate-shopping. But opening credit accounts within a short period of time represents some risk, and your credit could take a hit. Inquiries are probably not a huge factor in calculating your ability to repay a loan, but why take a chance?

10. Don’t spend money you’ll need for closing costs. Part of the price of financing a loan is closing costs, and you’ll likely have some responsibility for paying them. Make sure you have enough for your share.

 

Tips above written by Diana Lunden. Tips Above found at Realtor.com

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House Appraisal

What You Need To Know To Prepare For A Home Appraisal.

Here are a few key items to take into consideration when know who you are working with on your appraisal:

There are two types of appraisers – licensed and certified.  Licensed Appraisers can only do values up to $1,000,000.  Certified Appraisers can do any property value.  Additionally, Certified Appraisers must take a test and have a Bachelor’s degree.  Only Certified Appraisers can appraise FHA loans.

Did you know there are two types of appraisers? – Licensed and Certified Do you know the difference?

  • Larger banks are paying less to appraisers through Appraisal Management Companies.  Almost all of the banks own them so they can make more money.  This is not always a “good thing”.  Often times you will get an appraiser with less experience or one that will rush through the process because they have to make up their income by doing more volume.  Appraisal companies are in place to put a buffer between the lender, Realtor and appraiser to perpetuate a more “arm’s length” transaction.  What has resulted is that the banks are using this as a profit center and not always employing best in class appraisers.
  • Check with the appraiser’s competency and local knowledge.  Ask where they are located and if they are familiar with your property/area.  Additionally, ask how long have they been appraising homes?  Lastly, check and see if they work from home or office?   Many small owner operators work from home and as a result, don’t get exposures to other appraisers.  This lack of networking, idea sharing and updates on the market can hurt appraisals.
  • Education for appraisers is getting tougher.  There is an apprenticeship for 2 years now.
  • There are two types of appraisers – licensed and certified.  Licensed Appraisers can only do values up to $1,000,000.  Certified Appraisers can do any property value.  Additionally, Certified Appraisers must take a test and have a Bachelor’s degree.  Lastly, only Certified Appraisers can appraise FHA loans.

What you need to be prepared for your appraisal:

  • Always bring your own comparable sales – make sure they are good comps so you can build creditability.  Even bring low sales and let them know what the issues were that resulted in their low sale – pet odors, back to power lines, short sale, foreclosure, etc.
  • If at all possible, provide plat/floor plan – proper measuring is critical because if its 100 square feet off the true square footage you will have issues
  • Bulls eye approach – first look in subdivision, then do a radius search of 1 mile, 2 miles, etc. to find the right comparable properties.
  • Use a couple of higher sales, couple of smaller home, the radius approach to finding properties and a couple within the timeframe of settling within 3 months or less
  • You now need to have 5 to 6 comps
  • Provide 1-2 under contract comps as part of your presentation
  • Find FSBO too!  They can help your cause
  • Pass on any and all information you know about your property – list all recent improvements and their cost/value to help support your price.
  • Provide details on other offers if you had multiple offers
  • Provide additional pricing details like the Home Pricing Wizard, RBIntel statistics, and articles relating to escalating prices.

Steps to overcome low appraisal

  • Get a “good” conversation going, kill them with kindness
  • Provide new info that the appraiser might not be aware of when you met initially at the property
  • Be there when the appraiser wants to meet at the property
  • Use their language
    • Beneficial
    • Neutral
    • Adverse

Appraisers need to be concerned with the following items:

  • Safety –  the house needs to be safe, easy to explain
  • Soundness – the house needs to have structural integrity including but not limited to the roof and foundation
  • Security – the house needs to have locks on windows and doors

Integral issues for appraising

  • You have to know the condition and the subsequent ratings of the properties condition.  The rating scale goes from C1-C6.  One is the best and 6 is the worst.  Speak with the appraiser in terms of the condition to get more value for your clients
  • You also have to know the quality of the construction in order to help get more value.  Was the home custom built or was it a cookie-cutter built in the late 70’s with 7.5 foot ceilings?  These rankings range from Q1-Q6
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Back to school tips for Home buyers

Back-to-School Home Search Tips

Article by-Leslie Piper, Real Estate News

It’s that time of year when families consider moving to get their children into a good school district. At realtor.com we recently conducted a back-to-school survey to see how much weight schools have in the home-buying decision. The results show that school-district boundaries do impact the buying decision for more than 60 percent of realtor.com home buyers.

We also found that home buyers are willing to pay more and give up certain features for a home located in their district of choice. These buyers are especially willing to give up access to shopping and nearby parks and trails, among other amenities, to reside within the school-district boundaries of their choice.

A majority of the home buyers surveyed said that school-district boundaries will have an impact on their buying decision:

  • 23.59 percent would pay 1-5 percent above budget
  • 20.70 percent would pay 6-10 percent above budget
  • 8.98 percent would pay 11-20 percent above budget
  • 40.33 percent would not go above budget

For home buyers who said that school-district boundaries will have an impact on their decision, the majority rated the boundaries as an “important” consideration:

  • 90.53 percent said school-district boundaries are  “important” or “somewhat important”
  • 2.04 percent were “neutral” about the importance of school-district boundaries
  • 7.43 percent said school-district boundaries are “unimportant” or “very unimportant”

A new house can mean more space, great neighborhoods and good schools. Follow these five tips to find your dream home near the right school:

  1. Know your family’s needs. Is your family growing? Is square footage the most important factor, or a large backyard? Make a list of exactly what you need in your family’s new home.
  2. Search for homes by the best schools with the realtor.com mobile app. Only realtor.com lets you search for the home you want near the ideal school or school district.
  3. Review school information in the app. The Schools tab provides detailed information about the grades taught at each school, including the student-teacher ratio and the GreatSchools rating.
  4. Look for parks and play areas in the map view. View your search results on a map and narrow results by homes that have a place for your kids to get the wiggles out. You can also look for other things that matter to you, like how far away it is from a baseball diamond. Draw your own search boundary with your finger, if a specific area really matters to you.
  5. Make a list of questions for your Realtor. When you’re ready to tour the homes on your short list, be prepared with the questions that will help you make the best investment. Ask about things that matter specifically to you and your family but also what matters for the home’s future value. Your Realtor will be able to guide you to find the right home, in the right location, near the right school.
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