Sep 12, 2013 | Home Buyer Tips
So you are looking at buying a home, but you are wondering whether or not it is worth it to pay a little extra for a home with one more bedroom.
It’s a tough decision to make, especially when balancing other factors such as location and the other features of the home. However, having one more bedroom than you think you need could end up being a good thing for a number of reasons.
Expanding Family
Perhaps you only planned on having two children, but a third one might come along as an unplanned surprise… will you have enough room for everyone?
One of your children’s friends might have a bad home situation and need a place to crash for a while. One of your elderly parents might need to live with you for a while.
There are many situations when the family living under your roof might expand, (even if it’s just having guests over the weekend) so make sure that you have the space to accommodate.
A Home Office
If you are working from home or have your own business, a private space in the home to work can be worth its weight in gold. It’s really difficult to be productive when you are trying to work at the kitchen table with the rest of the family buzzing around you, so turn your extra bedroom into a home office.
Rental Income
An extra bedroom might be a great source of income, especially if it can be turned into a basement or attic suite. As long as you don’t mind the responsibility of being a landlord, you could rent out the room to a tenant and let their rent help you cover the mortgage payment.
Resale Value
Buying a slightly larger house with one more bedroom means that the home will be easier to sell in the future. This is especially true if all of the other homes in the area have similar amounts of bedrooms.
These are just a few reasons why an extra room can really come in handy. If you want to know more about home buying, you can contact me your trusted real estate professional.
Sep 11, 2013 | Mortgage Tips
If you are on the verge of buying real estate, you’ve probably heard the term Private Mortgage Insurance. Mortgage professionals talk about it a great deal, but you may be asking, “What is it exactly? And why should I care?”
Private Mortgage Insurance Defined
PMI is required by lenders if the down payment of a purchase is less than 20 percent of the home’s value. It protects the lender if the borrower defaults on the loan.
It also makes the lender more apt to loan, even if the down payment is as low as 3%, because in the long run, the lender’s investment is protected.
You Pay For It
Unlike other types of insurance which you pay to protect your interest in an asset, you pay Private Mortgage Insurance to the mortgage company to protect its interest in your new real estate. (Note that PMI is not usually tax deductible. Check with a tax professional for details.)
Make It Go Away: PMI Can Be Terminated Once You’ve Paid Down Your Loan
Once you pay down your mortgage to the point where it hits the magical 80% of the original purchase price or appraised value, whichever is less, you can request cancellation of PMI. The Homeowners Protection Act requires that loans made after 1999 include notifications to the borrower when you arrive at this point in your payments.
Your PMI payments must be automatically canceled once you pay down your loan to 78%. At closing, and on a yearly basis, you should receive information from your lender about when you can request cancellation.
Whether you’re ready to buy real estate or need more information before taking the plunge, I can help. Contact your trusted real estate professional today.
Sep 10, 2013 | Around The Home
Every home seems to have a never-ending remodeling list. As you consider tackling your next project, it usually pays off if you also think about helping the environment.
Green remodeling can last longer, utilize recycled materials and typically end up saving you money in the long run. Below are several environment-friendly ideas that will have your neighbors green with envy.
1. Rain Gardens
Rain gardens are a shallow depressions in your yard planted with native shrubs and flowers. When there is a large rainfall, all the water rushes along roadways picking up dirt and pollutants along their way to drainage systems and eventually rivers and streams. Rain gardens catch water run-off, which reduces the street flooding and makes for cleaner water sources.
2. Reclaimed Hardwoods
Using reclaimed wood is all of the rage right now – and it’s easy to see why. Reclaimed wood helps the environment by being recycled and repurposed from other structures. Turning an old barn into your new hardwood floors not only saves trees and looks great, but is an interesting conversation point.
3. Paper Covers Rock
Most kitchen remodels usually include the discussion of to go with granite or quartz countertops. However compressed paper or glass surfaces are actually better for the environment. Instead of harvesting natural resources, you’ll be recycling resources that have already been used.
4. One Shower Head
It’s tempting to use multiple showerheads and powerfully flushing toilets. However, reducing your water usage saves you money. Install low-flow water fixtures and limit yourself to just one fantastic showerhead in each bathroom. You’ll help the earth and your pocketbook by saving water.
5. Passive Solar Design
Solar panels are a great way to trap the sun’s energy and reduce your utility bills. However, if you’re not ready to directly tap into the grid, then there are ways you can remodel your home using passive solar design. Concrete floors and thick concrete, brick or plaster walls soak up the suns rays during the day and release them at night when the temperature drops.
Going green doesn’t have to hamper your lifestyle or your home’s design. With the five green remodeling ideas above, you’ll add value to your home, help the environment and put money back in your bank account.
Sep 9, 2013 | Housing Analysis
Last week was relatively calm due to the Labor Day Holiday on Monday providing little mortgage and housing related news. However, there were several positive indicators for overall economic conditions.
Construction spending rose by 0.60 percent in July and surpassed economists’ expectations of 0.30 percent and June’s zero percent growth. While this may seem a small increase, any indication that construction spending is increasing could indicate that residential construction is ramping up.
This would be good news for home buyers, who’ve been facing a shortage of available homes in many areas of the U.S.
The Fed Released Its Latest Beige Book Report
Federal Reserve districts reported rising consumer spending in most districts, modest expansion in manufacturing and moderate residential real estate sales. Higher mortgage rates may have dampened home buyer enthusiasm, but an ongoing shortage of available homes is also likely to have contributed to slower sales.
Mortgage rates will likely rise if the Fed tapers its $85 billion monthly purchase of mortgage-backed securities and Treasury bonds as demand for bonds is expected to decrease. When bond prices fall, mortgage rates usually rise.
ADP released its report on private sector jobs added for August; 176,000 jobs were added against expectations of 185,000 jobs added and July’s 198,000 jobs added. The three-month rolling average of private sector jobs added shows steady job growth as jobs added rose from 140,000 in May to 188,000 jobs for August.
Freddie Mac’s Primary Mortgage Market Survey reported that the average rate for a 30-year fixed rate mortgage rose by six basis points to 4.57 percent with discount points unchanged at 9.70 percent.
The average rate for a 15-year fixed rate mortgage rose by five basis points to 3.59 percent with discount points unchanged at 0.70 percent. The average rate for a 5/1 adjustable rate mortgage rose by four basis points to 3.28 percent with discount points unchanged at 0.50 percent.
According to the Bureau of Labor Statistics Non-Farm Payrolls Report for August, 169,000 jobs were created, which fell shy of expectations of 173,000 new jobs. Expectations were based on the original number of 162,000 jobs created in July, but July’s number was revised downward to 104,000 jobs created.
The unemployment report for August was 7.30 percent, down 0.10 percent from July’s reading of 7.40 percent.
The combination of higher mortgage rates, persistently high unemployment and fewer jobs created could signal the Fed to postpone its plan to start reducing its monthly securities purchases.
What’s Coming Up
This week’s scheduled mortgage and housing news is relatively flat, but Freddie Mac’s Primary Mortgage Market Survey will provide the last indication of mortgage rates’ direction before the FOMC meeting on September 18.
The Fed will also likely be watching the Weekly Jobs report and the University of Michigan’s Consumer Sentiment Index as part of its decision-making process on whether to taper or maintain current QE securities purchases.
Sep 6, 2013 | Around The Home
Most men, and even handy women, dream of a perfectly organized work space where their tools are orderly and they can tackle that list of home DIY projects.
However, renovations can get put on hold because there’s not a designated place to work. Tools are usually scattered throughout closets and the kitchen table serves as a workbench.
You can create a space for all of your improvement projects by turning a section of your garage into a construction-friendly, wonderfully organized haven for your tools and home makeover endeavors.
Below are easy steps to building the perfect garage workshop.
Make Sure You Have Adequate Space
Ideally, you’d still like to be able to get your cars in their designated space, so look for a vacant area at the back of the garage or along one side. If you’re garage isn’t quite large enough, then you might want to consider adding on to it or building an outdoor shed.
Create A Work Surface
For your work surface, you could repurpose old kitchen cabinets with a counter or build yourself a rough table using lumber from your local hardware store. Whatever you choose, make sure it’s sturdy. Cabinets will provide storage for all of the nuts, bolts, paint and little tools you’ll accumulate.
Clear A Wall
Whether this is above your workstation or alongside it, you’ll want an open area to hang up and organize your tools, so that they don’t clutter your surface. Put up a pegboard and create custom spaces with hooks.
There’s a certain satisfaction that comes will seeing all your tools hanging with in reach and a desire to fill it up.
Install Decent Lighting
You need to see what you’re doing when working with power tools. High-intensity lights, such as halogens or LEDs are perfect for brightening up your space. Utilizing them in track lighting or on bendable gooseneck fixtures can help you adjust the light to exactly where you need it.
Don’t let the thought of a home improvement project send you scurrying all over the house for tools. Take one weekend to follow these four steps and create a designated space for your garage workshop.
Everything will be in one place and it won’t matter how long a project takes or how much of a mess you make!
For more tips on home maintenance contact your trusted real estate professional today.
