The secret to successful remodeling is to keep up with the Joneses -- but never to surpass them. Whether you want to make more money than you spend, or just recoup your remodeling expenses if you sell your home, know what's standard in the neighborhood. Does everyone have laminate kitchen countertops? Splurge on granite and you'll be the envy of your friends, but you won't get your money back at resale. Is your home in a high-end neighborhood? Laminate countertops will save you money, but if you have to sell, high-end buyers will discount their offer because your kitchen isn't what they expect or simply not buy your home at all. In markets where home prices are declining, remodeling decisions are particularly tough to make, especially if you're remodeling to get your home sold. If you don't update, your home may not attract buyers. However, if you do update, you may not be able to recoup what you spend. Seek advice from at least three experienced real estate agents before making any decisions. Before you pick up a hammer, visit real estate open houses and new-home communities. Ask the builder to show you a spec home (that's an already built home without the model home's decorative features and upgrades). Then, compare your home to homes on the market to make sure your remodeling project is on par with the competition. "The homes that sell in a buyer's market have four things in common: an in-demand location, the right price, a perfectly maintained exterior and updated kitchens and baths," says Susan Huerta, a Realtor with Long & Foster Real Estate, Clarksville, Md. To get the biggest bang for your remodeling buck, try one of these 10 projects, which have the highest payoffs, according to Remodeling magazine's 2009 Cost vs. Value Report (CVR): 1. Show Your Good SideIf the exterior of your home is dated, start your remodeling there. Fortunately, siding, paint and other exterior fixes typically bring high rates of return, according to the CVR. "New siding and windows are among the least-costly upgrades a homeowner can make, yet they can have some of the highest returns," Huerta says. Nationally, you'll get the highest return on fiber-cement siding, which looks like wood, but resists termites and fire. Spend $13,000 to replace 1,250 square feet of siding and you'll see an $11,000 return, or 87 percent of your money back, at resale. Other options include vinyl and wood siding. Siding preference is highly regional, so go with what's most popular in your area. Have wood siding? A few gallons of fresh paint can really change your home's appearance. Get paint color cards to take the guesswork out of choosing a color. Head to a new-home community to see what the universally appealing shades are in your area. If you think your home was painted before 1978, test for lead before sanding or scraping. Remove old awnings on the porch and windows to spruce up your home with minimal cost and effort. Swap damaged wrought-iron railings for real wood supports for a more inviting entry. 2. Hit the DeckA deck is a double-bottom-line improvement. You can enjoy it now and it will add value to your home for years to come. Building a 16' x 20' pressure-treated wood deck with a simple pattern costs about $10,600. At resale, you'll get about $8,700 of that back, a recoup rate of about 82 percent. A composite deck will cost more, about $15,000, and return less -- about 74 percent or around $11,000 -- but you won't have to seal it, the CVR shows. If you have a deck already, use bold plantings to emphasize features, or to distract the eye from flaws. 3. Tweak Your KitchenGot an older kitchen with a great layout? Update by refacing cabinets and replacing appliances. Top off your remodeling with laminate countertops and resilient flooring for a total average national cost of $22,000. Your newly refurbished kitchen will bring in around $17,000 at resale, a recoup rate of 80 percent, the CVR says. "It's also possible to make appealing, neutral kitchen or bath upgrades without spending a lot of money ... if you choose your projects carefully or you can do professional-quality work yourself," says Huerta. If your home is worth more than $500,000, go with stone or eco-friendly countertops. To go green when you update, choose energy efficient appliances and countertops made from recycled materials. If even a minor kitchen upgrade isn't in the budget, brighten up your kitchen by giving your old wood cabinets new character. Just sand, paint and add new pulls -- it's a whole lot less expensive than buying new or re-facing cabinets. 4. Window DressingToday's vinyl, clad and wood windows are not only beautiful, they're energy efficient and can cut your heating and cooling bills. Getting 10 new 3' x 5' vinyl replacement windows runs about $11,000. On average nationally, you'll get back about $8,100 when you sell, a recoup rate of nearly 77 percent, the CVR finds. If you have an upscale home, buy upscale replacement windows. Nationally, 10 high-end wood windows will cost $17,500, which will earn back $13,500 at resale, or about 77 percent. 5. Kitchen OverhaulIf your home's value rises and your kitchen's finishes don't, it may be time for a major remodel, rather than small fix-ups. Budget 10 percent to 15 percent of your home's value for remodeling the kitchen. A complete kitchen remodel in a midrange home averages $57,000 and returns about $43,000 at resale, about 76 percent, the CVR says. That price buys 30 feet of cabinets, an island, laminate countertops, stainless sink, wall oven, cooktop, vinyl flooring and appliances. Need eight feet or less of countertop? Local granite dealers who sell (or even give away) remnants and charge for cuts and installation are a bargain option. 6. Strip the BathroomSince it's the smallest room in the house, remodeling the bath can carry a relatively small price tag, even when you replace everything. Putting in a new tub, tiles, vanity, countertop, medicine cabinet, light fixture, floor tile and wallpaper will cost about $16,000. You'll see $12,000, or about 75 percent, come back to you at resale, according to the CVR. To get an even higher rate of return, re-glaze your old tub for a like-new finish for $300 to $400. Remove or replace shower doors for an updated look. When choosing fixtures and finishes, stay neutral on what can't be easily swapped out. A black-lacquer bath cabinet with a black glass vessel sink may look cool to you, but if you have to sell, such a unique style might not appeal to your new audience: the average homebuyer. 7. Find Cash in the Attic It's almost always cheaper to repurpose existing space than to add square footage to your home. Spending the national average of about $48,000 to create a bedroom in the attic will net you around $36,000, or about 74 percent at resale, the CVR reports. That price includes a 15' x 15' bedroom, a 5' x 7' bath with shower, a 15-ft. dormer, four windows and a closet. Can your existing HVAC system heat and cool another room? If not, budget for a second unit. How much value an attic bedroom creates varies a lot between regions. You'll get a whopping 87 percent return on the West Coast, but only 67 percent of your money back at resale on an attic conversion in the Northeast. 8. Basement BucksBasement remodeling is a big project that pays back both personal and financial dividends. You'll enjoy watching movies, entertaining at the wet bar and hosting more guests when you add a full bath to your plans. The average national cost to create a 20' x 30' room in the lower level of your home with drywall, a storage area, recessed lighting, laminate flooring, a wet bar and a full bath is about $61,000. You'll only see about 74 percent, or $44,000, of that back if you have to sell soon, the CVR says. Always fix flooding problems first. Add French drains, bigger gutters or re-slope the yard to keep water out. Test to make sure the fixes work before investing time or materials in a basement. Want just the wet bar? You can buy 10 linear feet of cabinets, a laminate countertop, a stainless steel drop-in bar sink and an under-counter refrigerator for about $3,000. 9. Adding Space to Add ValueA two-story addition that includes a new bedroom and full bath upstairs and a family room with a fireplace downstairs is a huge investment, costing, on average, $147,000 nationally. You'll see about $104,000 of that investment returned to you at sale time, or 71 percent, according to the CVR. Before you start a large project, know the value of your home and the value of the biggest, best home in your immediate neighborhood. Add your current home value and the cost of the addition. If that number is more than what the best home in your neighborhood is worth, you're unlikely to recoup your money. Instead of remodeling, consider whether you should move to a new home. 10. Dig Up Some ValueIt's not on Remodeling magazine's list, but landscaping -- especially plant-it-yourself landscaping-- offers a great return on investment. The average homeowner spends about $3,502 for landscaping and another $1,465 on a designer, according to the American Nursery & Landscape Association. If you're not sure where to start, local garden centers often offer free design services. You can also peruse your community for ideas and ask the neighbors what works for them. Focus on making your walkway and doorway a focal point. If your doorway is overwhelmed by greenery, replace overgrown shrubbery with flowering foundation plants, mixing heights and colors for eye-catching drama. A walkway leads buyers' eyes to your door.
As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed legislation that grants a tax credit of up to $8,000 to first-time home buyers. Here is more information about how the 2009 First-Time Home Buyer Tax Credit can help prospective home buyers become part of the American dream. Who Qualifies? First-time home buyers who purchase homes between January 1, 2009 and December 1, 2009. To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase. Which Properties Are Eligible The 2009 First-Time Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops. How Much Will the Credit Be? The maximum allowable credit for home buyers is $8,000. Each home buyer’s tax credit is determined by two factors: The price of the home—the credit is equal to 10% of the purchase price of the home, up to $8,000. The buyer's income—single buyers with incomes up to $75,000 and married couples with incomes up to $150,000—may receive the maximum tax credit. If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit? Yes, some buyers may still be eligible for the credit.The credit decreases for buyers who earn between $75,000 and $95,000 for single buyers and between $150,000 and $170,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income—over $95,000 for singles and over $170,000 for couples are not eligible for the credit. Will the Tax Credit Need to Be Repaid? No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during the three-year period, the credit will be recouped on the sale.
This article written by Linda Spradlin was recently published in "Realtor Rightings"What began as in investment opportunity and tax shelter turned into a growing and prosperous business for my agents and me. In the early 1970s my husband decided we should begin investing in real estate through rental properties. Since he could fix anything and I always thought I could decorate (especially early rent houses) we went in to this venture as a team. Shortly thereafter, 20 acres and a small house became available in Oklahoma just 12 miles from Fort Smith. We bought that as a getaway- and that’s how I lost my partner in real estate. Buddy decided to begin a registered Angus cattle operation and left me with houses to take care of. I became an expert painter, wallpaper hanger (my sister Dinah would disagree with this) and could fix nearly anything with a good caulking gun and duct tape. This was my day job while our five sons were in school. I was so good at this job that friends approached me to take care of their rental properties which I agreed to do. Here comes trouble! Again, my husband thought I should take the real estate course just so I would understand a little more about the business. I said I would after he promised the prize of a new “Dooney Burke” purse (that thing weighed 5 pounds). You can guess what happened next. I found out I was illegally managing property for others. Uh oh. I approached one well known company in Fort Smith and they were very welcoming but they wanted 50 percent of my income in order to work with them. I was outraged since I had built my business for several years and they wanted 50 percent while I had done and would continue to do 100 percent of the work. I finally reached an agreement with another company, worked for two years, took the broker’s exam, and that’s how Assurance Realty became locally owned and operated Real Estate Company. Since opening in 1988, Assurance Realty has become a “house sold” name in the River Valley. Real estate is a relationship business and we strive to provide knowledge and outstanding customer service to the public. In spite of all the negative press we’ve been subjected to for the last two years, I decided to build and new building on Towson Avenue in Fort Smith. We opened for business in our new location November 2007 and had a wonderful open house in February 2008. Our company has enjoyed consistent growth and increasing market share since inception and has grown from one agent (me) to 20 agents. In 2005, we opened Arkansas-Oklahoma School of Real Estate in an effort to help educate those who were considering a career in real estate. Our school offers pre-licensing, post licensure, and continuing education either in the classroom or online. The internet has enabled us to be a global company in real estate and in education. Studies have shown that a greater number of consumers begin their search at home and it stands to reason that they would want to educate themselves the same way. Assurance Realty is proud of the fact that we have five brokers on staff to help new agents and constantly educate all agents affiliated with our company. We’re growing and have agents who specialize in residential, commercial, investment properties, farms and land.
Full List from CNNMoney.comThe editors of Money Magazine have named Fort Smith as #1 on the list of 25 Best Places for Affordable Homes. Median home price (2007): $87,000 Median family income: $51,939 The days of Wyatt Earp and Jesse James may be gone, but a piece of the Wild West endures in Fort Smith, where annual festivals, the Old Fort Days Rodeo, and "Miss Laura's" brothel-turned-visitors' center keep the frontier spirit alive. Nestled in the Ozark Mountains, the town is surrounded by the Arkansas River and its tributaries, where thrill-seekers go white-water rafting or canoeing. Three- or four-bedroom houses hover around $200,000. Waterfront properties are pricier: A house with river frontage starts around $500,000 for a four-bedroom, three-bath home and can range into the millions. Wine aficionados can drive about an hour through the Arkansas River Valley into wine country for tours and tastings.
Bush Signs Housing Rescue LawNEW YORK (CNNMoney.com) -- President Bush on Wednesday signed into law a sweeping housing bill that aims to boost the struggling housing market and bolster mortgage finance giants Fannie Mae and Freddie Mac. The Senate voted 72-13 in favor of the bill on Saturday, after the House passed it three days earlier. "We look forward to put in place new authorities to improve confidence and stability in markets, and to provide better oversight for Fannie Mae and Freddie Mac," said White House spokesman Tony Fratto. "The Federal Housing Administration will begin to implement new policies intended to keep more deserving American families in their homes." The new law, one of the most far-reaching on housing in decades, marks the centerpiece of Washington's efforts to address the nation's housing meltdown. Read more
"The Fort Smith Board of Directors at a special meeting Monday unanimously approved financial benefit packages to assist two local companies in their relocation to Chaffee Crossing.PRADCO-Fishing, a fishing lure manufacturer located in Fort Smith for more than 40 years, plans to build a $21 million, 300,000-square-foot manufacturing facility on 67 acres, and a research/lodge facility on 40 acres surrounding Stick Lake.Read more
There are some basic rules of Real Estate: Location, Location, Location. Buy the least expensive house in the neighborhood. Purchase what you can actually afford…etc. One rule has faced challenge, particularly from the Wall Street Equity ‘gurus’ like Jim Creamer: “It is better to own than to rent.” Some ‘experts’ suggest that it is better to rent now than to own, particularly with prices dropping. As with all rules, they need to be qualified and explained. It is, in fact, better to own rather than rent over the long term. . Lawrence Yun, the chief economist for National Association of Realtors reported the following data from the Federal Reserve: "The median wealth accumulation for renters from 1995 to 2004 was $4,000. The median wealth accumulation of a homeowner was $184,000." Obviously, owning, over the long term, is better than renting. The qualification is important. If you are going to move within 18 to 24 months, it may not make sense to own given the cost to acquire and the cost to sell. However, if you are going to be in a place for few years it is foolish not to own. There is an income tax deduction. Assuming you pay principle in your mortgage payment, you are increasing equity in your property. Both of these fact happen, even if the property does not appreciate, increase in market value, at all.
So in a correcting market what should you do? First, get some expert advice from a professional, ideally a Realtor. This person can help you find, negotiate, obtain financing and complete the acquisition of a home under preferred terms. You want to buy the best value, in the strongest location, with the least risk of detrimental conditions, at the best price. A Realtor can provide you with comparable sold information and price trends within neighborhood and towns. Make certain to study this information. Secondly, make certain that you can afford to own the house. Do not purchase more than you can afford. Pre-qualification with a mortgage originator is critical. Also, remember to look at the maintenance and repair costs of owner ship. Think about negotiating a home warranty like, AHS or HFS, into the purchase price of your new home. If you negotiate a buy down for the payments for the first couple of years, you need to make sure that you can afford the actual cost. We just negotiated at 2.1 buy down for a client. The monthly payment should have been $1400 per month, but with the buy down it is $1050 the first year and $1175 the second year. The seller pre-paid the difference for the buyer. It was great for the buyer, but the buyer was ABLE to pay the full amount. This is important that you be able to pay the ‘real cost’ of the monthly payment. Third, you must do a home inspection to make sure the property is in good condition. It will cost around $400. plus, but it is very important. A roof repair could cost thousands. You want to know what you are buying and what its condition is. Agents and most homeowners do not really know what the overall condition of property is. Bring in a pro! Finally, do not rush the process. Have a criterion for purchase. The most effective buyers have alternative properties. They avoid becoming emotionally committed to one possible choice. It will take time, so be patient and take the time necessary. The market has great selection and prices have come down. In short, there are some great buys available right now. Take advantage of the market: it is better to own rather than rent.
5 Tips for Selling a House in a Slow Market As Posted on US News and World Report It's no secret that the days of houses selling like Beanie Babies are over. After real estate appreciated at jaw-dropping rates during the first half of the decade, home prices and sales tallies have dropped precipitously in recent months—tilting market dynamics to favor buyers over sellers. That doesn't mean your house won't sell, just that the playing field has changed. So here are five tips to help you get a timely sale at a fair price in today's reshuffled housing market. Read more
Offering freebies with your house is almost a requirement in today's market. But forget the Final Four tickets. Buyers want you to help reduce the initial hit to their wallet should they buy your house. By Karen Aho
Your house has been on the market for months. The for-sale sign, spattered with mud, has tilted over in surrender. As you go to straighten it, you trip over the morning newspaper, and, presumably, your answer: Inside is a story about a home that sold quickly after owners tossed in Hannah Montana concert tickets.
Below is a very helpful list of areas to clean that are often overlooked while preparing your home to sell: ·Clean kitchen ceiling, cabinets, appliances, and fixtures. ·Clean, wax, and polish kitchen floor. ·Clean bathrooms thoroughly- floors, walls, fixtures, and tiles. ·Clean and dust radiators and heating vents. ·Use 75 watt light bulbs to brighten rooms. ·Arrange furniture to make rooms appear larger and provide maximum walking space. ·Clean attic and other storage areas. ·Clean closets and hang clothes neatly. Store shoes, luggage, and other articles neatly.
And one more tip from Assurance Realty!
CLEAN BASEBOARDS! Cleaning the baseboards in your home can make a world of difference in the eyes of a buyer! Try it, and you will see the difference it can make in your home.
"Now it's time to hit the pavement, or the web in search of a home:Your first step here is to figure out what city or neighborhood you want to live in. (Remember the old saw about "location, location, location.")Read More
