Dec 3, 2014 | Home Buyer Tips
Are you about to buy a house or condo for the first time? Congratulations! Owning your own piece of real estate is a liberating experience and one that will provide you with the foundation to build your personal wealth and equity. Once you own your own home you’ll be responsible for a variety of new costs, including property taxes which are assessed by your local government to pay for municipal services. In this blog post we’ll share how property taxes work and what you can expect to pay when you buy your new home.
It All Begins with a Local Property Tax Assessment
As mentioned above, local governments assess property taxes as a means for paying for police officers, fire fighting services, road maintenance and the other various costs that come with running a town or city. Whether you’re buying a house, a townhouse or a condo, the property that your home sits on is inside of an area known as an “assessment area”. When the local government determines what your local tax levy or tax rate will be, they will assess your home based on the real estate market value of similar homes in the area. You can multiply your tax rate by the assessed value of your home to determine how much you’ll owe in property tax.
Property Taxes as Part of Your Closing Costs
When you close on your new home you’ll have to pay property taxes, and your real estate agent will help you to understand how much these taxes will be and how they will be paid. In most cities and counties you’ll pay a pro-rated amount of property tax that covers the time span from the date you purchase the home until the end of the year, after which time you’ll be paying your full assessed rate.
Don’t Forget Your Overall Tax Picture
Finally, don’t forget that property taxes can be factored in to the rest of your overall tax picture. Check with your accountant or another financial professional to determine whether or not you can write your property taxes off against your income tax to save some additional money. There are numerous tax benefits to owning a home, so it’s best to start using them from day one.
As with all other taxes, property taxes are a fact of life that every homeowner faces. When you’re ready to buy a new home and to learn more about how property taxes will affect your purchase, contact your local real estate agent today.
Dec 2, 2014 | Home Buyer Tips
Whether you’re buying a ski-in/ski-out condo at your favorite resort or you’re thinking of picking up a small home in a busy tourist area, buying a property for short-term rental purposes can be an excellent investment that quickly begins to provide additional revenue.
Let’s take a quick look at a few steps that you can take to maximize the revenue that your investment properties bring in each month.
Upgrade Your Home to Give It a Luxurious Feel
It should go without saying that if you want your home to rent for a high price it has to have a significant amount of value behind it. After you purchase the home, spend some time on upgrades that help to enhance the home’s beauty and usability. If possible each sofa should be a sofa-bed so that additional guests can stay the night. Upgrade the televisions, have Wi-Fi internet access available and provide a phone number that guests can call if anything goes awry.
Professional Photos and Copywriting
If you’re renting your property out to short-term or vacationing tenants you’re most likely going to use online services like VRBO, HomeAway or AirBnB to attract new business. While these sites have a lot of visitor traffic you’re also going to face a high level of competition from other property owners in the area. It’s worth paying a professional photographer to take pictures of your home as well as having a professional copywriter handle the sales copy for your listing. These are one-time costs that can help you to defeat your competition and close high-ticket clients.
Cater to Large Groups or a Niche Crowd
There are a number of “niche” travelers out there and if you can cater to these groups you’ll find that you’re able to charge more than the average vacation property. For example, you may be buying a home in a popular wedding destination that can be marketed to couples who are being married. If you’re buying a larger 3 or 4 bedroom home, be sure to note that it can house large groups who may be traveling together.
Referrals and Repeat Business
Finally, don’t forget to ask your clients to refer you to their friends and family who many want to stay in your unit, and always invite them to return in the future. You may want to consider offering a discount to repeat visitors to encourage them to visit annually.
Renting out your vacation home or investment property can provide a lucrative income stream as long as you have a professional approach and focus on providing a high level of customer service. When you’re ready to start shopping for the perfect investment properties, contact your local real estate agent.
Nov 25, 2014 | Home Buyer Tips
Are you buying a new home? If so, you’ve likely pondered whether or not you should invest in a warranty to protect your investment. In today’s blog post we’ll briefly explore home warranties including some of the pros and cons of buying one and how they differ from homeowner’s insurance.
The Benefits of Buying a Home Warranty
Home warranties are an excellent solution if you’re buying a brand new home which has a lot of new appliances and fixtures inside of it, or if you’re not really the “do it yourself” type and would prefer to make a service call if something inside of your home breaks down.
For example, imagine that you have a home warranty that covers your central air conditioning system and one day it stops working. You simply call the warranty provider to book a service call and as long as the problem falls within the scope of your warranty the repairs are completed without any additional cost to you.
How a Home Warranty Differs from Homeowner’s Insurance
Home warranties and homeowner’s insurance are vastly different but work together to protect your investment. Insurance policies cover your home against unexpected damage – fires, crime, wind storms, water damage and more, depending on your policy. A home warranty tends to cover items inside of the home – the furnace, the plumbing, electrical wiring and appliances – and will provide you with discounts on repairs or replacement should the covered items break down or otherwise stop working.
Cost and Other Home Warranty Downsides
Of course, there are a few downsides to buying a home warranty. You’ll need to pay the up-front purchase cost of the warranty unless you’re buying a brand new home in which the warranty is included. You’ll also find that warranties generally won’t cover a lack of maintenance due to the previous homeowner, which can be a bit of an issue if something breaks down and you find out it’s not going to be covered. Finally you may find that any necessary repairs are actually less costly than the warranty itself.
As you can see, home warranties aren’t the perfect solution for every scenario but if you’re buying a new home they are an option worth considering. For more information about home warranties and how they will affect your purchase, ask your real estate professional as they’ll be able to share their guidance and expertise.
Nov 21, 2014 | Home Buyer Tips
If you’ve been thinking about investing in a real estate project you may have considered buying a distressed house or two at a steep discount in order to fix them up and sell them at a higher price. This is known as “flipping”, and in today’s post we’ll share a quick guide to flipping homes and how to get started with this type of real estate investing.
Assessing Your Budget and Tolerance for Risk
We’ll start by stating the obvious: when you buy real estate with the intent of flipping it, losing money is a very real possibility. You’ll need to assess your own tolerance for risk and decide how much you want to invest in your real estate venture.
If you’re new to buying homes it’s a great idea to start small – an inexpensive “fixer upper” house or a condo – and work your way up from there. Spend some time crafting a budget to assess how much you’ll be spending to acquire the home and in repairs or renovations, and what you expect to receive when you sell.
Shopping for Suitable Houses and Condos
Once you’ve got your budget prepared and your finances are in order you’ll need to start looking for a suitable home. The ideal listing is one that is priced at a discount to all of the other homes in the neighborhood as the home is in some state of disrepair or has certain issues that need to be fixed up. Spend some time browsing through local property listings which are sorted by price and note which options are the least expensive. This is where you’ll want to start.
Scale Things Up by Finding a Partner
After you’ve bought, repaired and sold a home or two you’re likely going to want to scale things up. Consider bringing on a partner who can help shoulder some of the workload or one that may want to invest capital so that you can buy homes in a higher quantity. Remember, this is business; if you work with someone else you’ll want to formalize your arrangement with a written contract.
As with any business venture, there’s a bit of a learning curve that you’ll need to overcome when you begin flipping houses. As long as you’re patient and ready to move when you find the perfect home, you’ll soon find success with your real estate investments. To learn more about flipping houses and to get started with finding properties in your area, contact your local real estate agent today.
Nov 19, 2014 | Home Buyer Tips
Once you’ve found the perfect new home and delivered your first offer to the seller, you may find that they return with a counteroffer or a flat out refusal. Negotiation is part of the home buying process, but at times you may feel like the seller is the one holding up the deal due to their approach or attitude.
In this blog post we’ll share a few ways to manage an unreasonable or stubborn home seller so you can get the deal closed.
Ask Yourself: Are Your Demands Reasonable?
Before trying to figure out how to work the seller from a different angle in order to win the home, you’ll need to assess whether or not there’s a problem with your offer or your purchasing terms which is causing friction with the seller.
Ask the seller or their agent to identify the exact issue so that you can decide whether or not you are willing to sacrifice that particular term in order to secure the home.
What is Motivating the Seller?
If you’re finding that seller is simply being stubborn or is unwilling to budge on their price or the terms of the sale, you’ll need to approach them differently. During the home buying process it should be your goal to try to figure out why the seller has placed their home on the market and what their motivation for selling might be.
Are they moving to a new city for work? If so, there is likely some sort of time limit on their sale and you may be able to wait them out. Or, perhaps you’ve discovered that they are simply downgrading to a smaller home and that they’ll only sell their current home for the right price.
Sweeten the Deal and Be Ready to Walk
If the price is what is holding the deal up, you can submit a final offer with your maximum price but be sure to let the seller know that you’re walking away from the deal if they aren’t ready to sign. At this point you can consider the home a lost cause if they refuse, so table the best offer that you’re willing to make and encourage the seller to accept it.
Dealing with a stubborn home seller might seem like a bit of an impossible situation, but try to keep in mind that they are selling their property for a reason. If you have your heart set on the home just keep faith that eventually they’ll crack and the home will be yours. If you’re just getting started with the home buying process or if you need more information about buying a local property, contact a real estate agent today.
Nov 6, 2014 | Home Buyer Tips
Are you moving to a new community or a new city? When you find a new house that meets your needs and seems like a perfect fit, you’ll want to take some time to meet your potential new neighbors before you sign on the dotted line.
In today’s blog post we’ll share a few reasons why meeting the neighbors can help you feel right at home in your new community.
Your Neighbors Are Experts on Your Local Community
Whether you have questions about the area’s safety at night or you simply want to know where the best coffee shops are, you’ll find that your neighbors are an excellent source of information about the local area.
Spend some time thinking about questions that you would want answered before committing to buy in a certain area, and ask the locals after you’ve viewed the home. Yes, you could ask the seller, but remember that it’s their goal to get you to buy the home and you’re most likely interested in impartial answers.
They Can Help the Kids Get Settled in
If you’re moving to a new city with children you’ll likely want to get them introduced to other neighborhood kids so they can start making new friends. Meeting your potential neighbors during the home buying process will allow you to determine which have children that are of a similar age as yours. Of course, if you find that there are no other children in the local community that might be a sign that the area isn’t very family-friendly, so you’ll want to factor this in as well.
You’ll Need to Assess Your Future Relations
If you decide to buy this particular new home you’re likely going to be living in the local neighborhood for years – perhaps even decades. Meeting the local neighbors before purchasing your home allows you to make an assessment of how well you’re going to integrate into the local community and whether or not you’ll be able to have warm relations with those that live around you. It takes just a few minutes of asking around friends and family to hear horror stories about bad neighbors; meeting the locals will help ensure that you don’t make a mistake that you’ll regret later.
When you’re ready to start your hunt for the perfect new home – and the perfect new neighbors – contact your local real estate professional. Working with an experienced real estate agent is the best way to get the home you’re after in a price range you can afford.
