Study: Outdoor Projects Pay Back at Resale

Daily Real Estate News | Tuesday, September 27, 2016

Home owners may want to focus more of their remodeling dollars on boosting curb appeal. Outdoor remodeling projects not only offer some of the highest returns at resale, they can also increase the happiness of home owners who are staying put in their homes, according to the 2016 Remodeling Impact Report: Outdoor Features, which was released Tuesday by the National Association of REALTORS® and National Association of Landscape Professionals.

Taking care of the home’s lawn can bring some of the biggest bang for your buck. The Remodeling Impact Report found reveals that REALTORS® find projects like seeding the lawn, implementing a standard lawn care program, and updating a landscape with sod lawn can have some of the highest returns at resale.

“REALTORS® understand the importance of curb appeal-from flower beds to fire pits- because when it is time to sell, a home’s exterior is its first impression to potential buyers,” says NAR President Tom Salomone. “REALTORS® also know that these projects can bring home owners who have no plans to sell even more enjoyment and satisfaction in their home.”

REALTORS® ranked the following outdoor remodeling projects as the most likely to add value to a home at resale (listed from highest to lowest):

  • Landscape upgrade
  • New patio
  • New wood deck
  • Standard lawn care
  • Sod lawn
  • Softscape
  • Seed lawn
  • Outdoor fireplace
  • Outdoor firepit
  • New pool

For home owners in search of more happiness, they may want to consider a pool. The study found that a new pool comes in number one in the enjoyment home owners gain from an outdoor remodeling project. Ninety-five percent of home owners who completed a pool project said they have a greater desire to be home; 90 percent feel a major sense of accomplishment; and 80 percent say they have an increased sense of enjoyment when they are at home, the study finds.

But home owners shouldn’t bank on recouping the full cost of the pool at resale. REALTORS® estimate that home owners likely will only recoup 50 percent of the cost of the pool at resale.

Other outdoor remodeling projects that scored high on bringing “joy” to home owners was an overall landscape upgrade, followed by a new wood deck.

“Home owners looking to take on large, expensive outdoor projects should do so for themselves, for the enjoyment they and their family will gain from the finished results, and not only to improve the value of their home for when they sell,” Salomone says. “Smaller projects will bring potential sellers the most value back upon resale – and have the benefit of costing less up front.

By Melissa Dittmann Tracey, REALTOR® Magazine Daily News

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5 Ways to Add Curb Appeal to Your Listing

Daily Real Estate News | Thursday, September 22, 2016

Pay attention to the curb appeal of the home you’re showing. From the driveway to the front yard and home exterior, the outside of the home is a big key to buyers’ first impression of a home.

A recent realtor.com® article highlights some ways to boost the curb appeal of your listing, including:

Landscape: It can pay off. Well-landscaped homes get anywhere from a 5.5 percent to 12.7 percent sales boost, according to Alex X. Niemiera, a horticulturist at Virginia Tech. Adding some plants and sprucing up the landscape may be worth it for potentially an extra $16,500 to $38,100 in value on a $300,000 home, according to his research. Make sure the grass is trimmed, clear away any dead limbs or unwanted foliage hanging around the house, and remove any tree branches or bushes that are overcrowding the yard.

Pay attention to the mailbox: “Paint it, polish it, or replace it,” according to the realtor.com® article.

Check the lights: A front porch light can add some appeal. “Attractive light fixtures can really add to the appeal of a home, even if the lights aren’t on,” realtor.com® notes.

Clean: Wash the windows. Consider power washing the house to remove any dirt and grime.

Do some touch-ups: The entire house may not require repainting but just certain areas, like the trim and front door. “While you’re at it, consider brightening the façade with a touch of contrasting color,” the article notes. “You’ll be surprised by how a little pop of color can really freshen up the space.”

Source: “What Is Curb Appeal? How to Supercharge the Impression Buyers Have of Your Home,” realtor.com® (Sept. 21, 2016)

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4 Ways to Make a Home Show-Ready

Daily Real Estate News | Tuesday, September 20, 2016

When a home hits the market, it needs to be show-ready. That doesn’t usually require spending a fortune on a remodel, however. Just targeting a few key areas in the home can go a long way.

The New York Times recently highlighted a few tips from real estate pros on preparing a home for sale, including:

Add three points of light. “Every room should have at least three points of light,” Alison Draper, a real estate professional with Halstead Property, told The New York Times. The three points could include a table lamp, floor lamp, and a task light. Or, it may include an overhead fixture and two table lamps.

Shine the floors. You likely can still salvage a worn floor with some polish or professional cleaning. “Unless your floors are severely damaged, it doesn’t make sense to have them refinished,” Pat Christodoulou, a home stager in Connecticut and New York, told The New York Times. She suggests hiring a handyman with a floor buffer, which might cost about $300 to wax and polish the floor of a small living room.

Tidy up the bathroom. The key: Make it sparkle. Re-caulk necessary areas. Investigate small upgrades that can have a big impact on brightening the space, such as swapping out an old faucet or even adding a new shower curtain, bath mat, and fresh towels. For a bathtub in need of some TLC, a professional refinisher can reglaze it, repairing any dents, rub out rust spots, and recoat it for about $500 for a standard-size bathtub, according to Homeadvisor.com.

Deep clean. The key: Make the home sparkle. Wash the windows, inside and out. Vacuum the dust in exhaust fans. “Deep cleaning is so important because while an apartment can show very neatly, it’s the details that people pick up on,” says Heather McMaster, an associate broker at the Corcoran Group.

Source: “Preparing a Home for Sale,” The New York Times (Sept. 16, 2016)

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A Look at Pricing Per Square Foot by Region

Daily Real Estate News | Tuesday, September 13, 2016

When comparing single-family homes started last year by region, the median price per square foot can vary quite a bit.

For example, contractor-built homes in the Pacific division price per square foot averaged $168 while speculatively built homes in the East South Central division averaged $78 per square foot.

“At $168 per square foot, new contractor-built single-family homes in Pacific are the most expensive to build exceeding the national average of $105 per square foot by 60 percent,” notes the National Association of Home Builders on its Eye on Housing blog. The price per square foot excludes the cost of developed land.

New England has the second most expensive contract prices per square foot at $149 per square foot. The region also had the priciest spec houses last year with a median sales price of $144 per square foot.

Meanwhile, for home buyers searching for deals they may want to look South. The South Region had the least expensive spec homes, with median sales prices per square foot ranging from $78 in the East South Central division to $87 in the West South Central division. Contractor-built new-home starts were higher, ranging from $98 in the West South Central division to $100 in the East South Central and South Atlantic divisions.

“Typically, contractor-built custom homes are more expensive per square foot than spec homes after excluding improved lot values, suggesting that new custom home buyers are not only willing to wait longer to move into a new home but also pay extra for more expensive features and materials,” the Eye on Housing blog notes.

Source: “Sale and Contract Prices Per Square Foot in 2015,” National Association of Home Builders Eye on Housing blog (Sept. 12, 2016)

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Paint Colors That Make a Room Look Bigger

Daily Real Estate News | Tuesday, September 9, 2016

A room’s size is sometimes a matter of perception, and the paint color on the walls has a lot to with that perception. Some colors can actually make a room appear smaller, while other colors can make the walls expand and feel larger. Realtor.com® recently highlighted some of the paint colors to create the illusion of more space, including:

White: White reflects light, thereby making a space look brighter and feel more open. “White will make any room appear bigger and complement the natural lighting,” Than Merrill, a real estate investor and host of A&E’s “Flip This House” told realtor.com®.

Yellow: A creamy and soft yellow can also reflect light, and can create a softer alternative to white (as long as it’s not too bold of a yellow). Add white accents, such as on the trim, to add further dimension to the room.

Gray: A calming, light shade can help expand a room and, unlike white, doesn’t cast off a glare.

Monochromatic color schemes: Use a monochromatic color scheme for the entire space to open it up (in other words, stick with the white, gray or soft yellow and don’t introduce then a bolder color). “Choose rugs, furniture, and accents in similar shades – like a patterned rug in white and light gray,” realtor.com®’s article suggests. “This creates a minimalist, clean look that makes the entire space feel larger.”

Source: “What Colors Make a Room Look Bigger?” realtor.com® (Sept. 9, 2016)

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5 Home Buying Myths

Daily Real Estate News | Tuesday, September 06, 2016

Home buyers get a lot of advice from friends and family – some good, some bad. A lot of myths can pop up and negatively guide their home purchasing experience. Make sure your clients don’t fall for one of these common buying falsehoods.

1. The only upfront cost is the down payment.

Buyers need to be prepared for several expenses – everything from fees, taxes, costs for inspections, credit reports, insurance, and others. Closing costs can be anywhere from 3 percent to 6 percent of the purchase price. Those costs can fluctuate greatly depending on the state you live in too.

2. Just looking for a house casually is not a big deal.

Some people may want to just start looking at homes to get a feel for the area, before they even sit down with a REALTOR®. But they could be setting themselves up for major heartbreak. “A buyer might be viewing homes that are in a higher or lower price range than what they are qualified for,” Connie Antoniou, a broker associate in Barrington, Ill., told realtor.com®. Home shoppers – even at the earliest stages – should get pre-approved for a mortgage so they know their budget from the get-go and don’t waste time looking at homes that are out of their price range.

3. You must have a 20 percent down payment.

A 20 percent down payment will help a buyer avoid paying private mortgage insurance. But 20 percent down isn’t required. Many lenders will still qualify a buyer for home loans with 10 percent or 5 percent down. Some buyers can even qualify for only 3.5 percent down with a Federal Housing Administration loan. There are many options for down payment assistance that lenders can explore with a buyer who has a limited amount to put down.

4. Schools shouldn’t matter if you don’t have kids.

“The neighborhood you choose matters – both now and later when you might consider selling,” notes the realtor.com® article. “Even if you don’t have children, good schools are a sign of a good neighborhood.” Buyers should explore all factors with their REALTOR® on items that could influence their homes appreciation and desirability so they don’t run into trouble later on one day when they try to sell.

5. You don’t need a home inspection.

When the housing market is extremely competitive, some home shoppers may be willing to waive the home inspection in order to get the home they want. “But beware: sellers are banking on your skipping this crucial step,” the realtor.com® article notes. “It means you’ll get the home as is, including any and all problems that come with it. And sometimes those problems aren’t exactly visible.”

Source: “9 Home-Buying Myths You Need to Stop Believing Immediately,” realtor.com® (Sept. 6, 2016)

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5 Fixes That Can Raise a Home’s Value

Daily Real Estate News | Thursday, September 01, 2016

For home owners looking to spruce up their home before listing it, there’s plenty they can do to attract more buyers and potentially boost the value of their home too.

Veteran real estate professionals recently weighed in at This Old House on some of the best home improvement projects they believe can help a home show better. Here are a few of their ideas:

1. Open up the space.

Create more space, whether that’s even removing a kitchen island or knocking out a non-structural wall. “Right now buyers want a wide open floor plan, the living room right off the kitchen. They are into big spaces,” Kristin Wellins, senior manager of program development at ERA Real Estate, told This Old House.

2. Light it up.

Keep the home bright: Have windows open to let the natural light flow in, consider lights that use motion detectors to turn themselves off, or install sun tubes, a reflective material that funnels natural light from a hole cut in a rooftop down through a ceiling fixture in a room. “High wattage bulbs make small spaces feel larger, and soft lighting brings warmth to empty spaces,” This Old House notes.

3. Enhance the front door.

“Don’t underestimate the power of a front door,” Willens says. “People make up their minds in the first seven seconds of entering a house.” Have an overhang on the front porch, such as an awning or portico above the front door, suggests Roger Voisinet, a real estate professional in Charlottesville, Va.

4. Pay attention to the floors.

Spend some money on the floors, suggests the real estate professionals surveyed by This Old House. Even a $600 to $900 investment could help boost the home’s value by possibly $2,000, they say. Get a carpenter or handyman to eliminate distracting squeaks from floors, repair any broken tiles, patch damaged floor boards, and remove wall-to-wall carpeting, they suggest.

5. Tackle easy bathroom upgrades.

Bathroom upgrades can quickly get pricey but a few upgrades can still make a big difference. For example, swap frosted glass for clear glass, remove any rust stains, apply fresh caulk, update doorknobs and cabinet pulls, replace faucets, buy a new toilet seat, or install a low-flush toilet.

Source: “Brokers Tell All: 10 Ways to Boost House Value,” This Old House (September 2016)

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Sales Contracts Surge to Highest Rate in 10 Years

Daily Real Estate News | Wednesday, August 31, 2016

Pending home sales were up in most areas of the country in July, reaching the second highest reading in more than a decade, according to the National Association of REALTORS®’ Pending Home Sales Index. Last month the Midwest was the only region of the U.S. to see a drop in pending sales.

The index increased 1.3 percent in July to a reading of 111.3. Pending home sales are now 1.4 percent higher than a year ago.

“Amidst tight inventory conditions that have lingered the entire summer, contract activity last month was able to pick up at least modestly in a majority of areas,” says Lawrence Yun, NAR’s chief economist. “More home shoppers having success is good news for the housing market heading into the fall, but buyers still have few choices and little time before deciding to make an offer on a home available for sale. There’s little doubt there’d be more sales activity right now if there were more affordable listings on the market.”

Notably, the West saw the highest jump in pending home sales, with contract signings up to the highest rate in more than three years. Yun attributed the rise to stronger labor market conditions in the region.

“If home building increases in the region to tame price growth and alleviate the ongoing affordability concerns, the healthy rate of job gains should support more sales,” Yun says.

Builders may be showing signs of focusing more on the middle and lower price tiers. They’ve been mostly focused on building larger, pricier homes for the upper end of the market for the last few years.

“REALTORS® in several high-cost areas have been saying for quite a while there is robust demand for single-family starter homes and townhomes at an affordable price point for young buyers,” Yun says. “The home ownership rate won’t move up from its over 50-year low without a meaningful boost from first-time buyers, whose participating has yet to noticeably increase so far this year despite mortgage rates near all-time lows.”

NAR predicts that existing-home sales will reach about 5.38 million this year, a 2.8 percent increase over 2015. That also would mark the highest annual pace since 2006 (when sales were at 6.48 million). Price growth of existing homes will likely moderate to around 4 percent this year, after a 6.8 percent jump a year ago, NAR forecasts.

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HARP Extended to 2017 as Bridge to New Refi Program

The Federal Housing Finance Agency is extending the Home Affordable Refinance Program (HARP) until Sept. 30, 2017. The FHFA estimates that more than 300,000 home owners could still benefit by refinancing through HARP.

The Home Affordable Modification Program and HARP aim to help borrowers lower their monthly payments. The program was launched in 2009  and originally set to expire on Dec. 31, 2013, but the government continues to extend it.

FHFA says the reason it opted to extend it again was to smooth a transition into a new refinance product that will be offered by Fannie Mae and Freddie Mac at the end of 2017. That product will reportedly be aimed at borrowers with high loan-to-value ratios.

“The new refinance offering will provide much-needed liquidity for borrowers who are current on their mortgage but are unable to refinance through traditional programs based on their LTV ratio exceeds the [GSEs’] maximum limit,” according to a recent news release.

The FHFA says that with the new LTV streamlined refinance product eligible borrowers will not be subject to a minimum credit score, there will be no maximum debt-to-income ratio or maximum LTV, and an appraisal often won’t be required. Borrowers would also be able to use it more than once to refinance their mortgage. (View more of the eligibility requirements at FHFA.)

The new LTV refinance offering won’t be available to borrowers until October 2017, FHFA says.

Source: Federal Housing Finance Agency and “HARP Extended into 2017; FHFA Plans New Refinance Program,” HousingWire (Aug. 25, 2016)

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