*Owner (Seller) Financing
There are several challenges that confront real estate home sellers and investors in the reality of today’s market:
So, where is the opportunity in all of this? Two words – Owner (Seller) Financing.
Owner financing takes you out of the buyer's market and puts you in a SELLER'S MARKET. These are just some of the benefits......
1) Higher Sales Price - you are able to command your price and your terms. You are the the underwriter and apprisaler.
2) Shorter Selling Time - Selling via owner finance often means putting a buyer in a home in less than 30 days!
3) Reduced Selling Costs - Expenses such as seller contribution to the buyer's closing costs, excessive repairs are required by lenders.
4) Reduced Carrying Costs - by reducing selling time, carrying costs while it is common to hold a property for 5 months or more when selling in the traditional market.
Seller financing helps move property that would otherwise sit on the market for months. Owner financing has exploded in popularity lately. A few years ago 1 in every 400 real estate. Transactions used seller financing, it’s now up to 1 in 50. This is an 800% growth.
Are you ready to become a better real estate home seller or investor?
Jing, as the realtor, I understand solid working knowledge of seller financing. I will market your home for sale, match you to one of owner financing specialists in the greater Houston area, not only you can sell your home faster with higher price and this company can services the mortgage for you too!
*Ways to Vet a Home-Remodeling Contractor
Anyone looking for contractor recommendations should check out FranklinReport.com, which compiles customer comments, or Angieslist.com, which charges $5 per month and uses credit card info to prevent multiple reviews from the same person.
If you find a contractor who looks reliable, before hiring him, do a background check. Credit bureau Experian runs Contractorcheck.com, charging $13 for a full report.
Seeking face-to-face personal recommendations is also a good idea.
Source: Money Magazine, Josh Garskof (08/27/2010)
*10 Risky Home Improvements
California realtor Carrie Benuska was ready to close on a house when the buyer pulled out during escrow. The reason for the last-minute turnaround: a bonus room her clients added to the back of their home years earlier.
"This bonus room was not bonus at all," Benuska told MainStreet. "The room spoiled the flow, was built in a sub-standard way, and required the buyers to rip the whole thing off, then rebuild or patch the back of the house where it was added." The buyer's unwillingness to fix someone else's home "improvement" illustrates the catch that comes with some home renovations.
You may be in love with your upgrade, but as with any investment, there's risk involved -- namely not getting your money back when you decide to sell your house. Some home improvements drive up your homeowner's insurance, require you to pay out of pocket for larger repairs, or even put your family's safety in jeopardy.
With many homeowners hoping to add value to their homes that lost value in the recession, here's a guide to the "upgrades" that just simply aren't worth it.
Earlier this year, consumer review website Angie's List polled more than 500 remodelers, real estate agents and contractors to determine what types of home improvement projects netted the highest return investment by increasing the value of a house. The project netting the lowest investment return, surprisingly, was a pool installation.
In-ground pools cost between $20,000 and $60,000 to install, but a homeowner wouldn't even recoup half of that. You won't get much more on smaller pools, hot tubs, or whirlpool baths, either. Moreoever, if the homeowners were ever looking to move, their home may take longer to sell. "Some buyers do not want a pool due to the maintenance, cost and liability," Anne Millians-Roche, president of Owens Realty Network in Florida, explains.
Additionally, fish-out-of-water families may want to purchase their pool after they've secured a homeowner's insurance policy, since a cement pond can drive up monthly premiums.
Putting in a Home Office ... or Monster Garage
What are other costly remodeling projects that might not be worth the expense? Installing a home office or a monster garage, which only recoup about a 60% investment return, according to Angie's List. Both will impact your ability to relocate significantly.
Why? Doing unique and costly remodels essentially puts your home in a niche market. A home office won't appeal to large families needing to covert it into a third bedroom. And the giant cave holding your car, meanwhile, might alienate those not devouring Car and Driver.
"The more unique the improvement, the narrower the market, and the harder the property is to sell, which eventually impacts sales price," Brian Coester, CEO of Coester Appraisal Group, explains. "If a homeowner's upgrades produces unique results, those improvements could end up costing the borrowers thousands of dollars in lost time on market or even equity."
Over-Decorating the Interior
If you're really sold on the idea of a home office, your best bet is to keep it simple. Don't paint the walls red, hang ornate chandeliers from the ceiling or weld the desk to the floor. Similarly, refrain from selecting orange countertops or patterned wallpaper for your kitchen. And definitely refrain from installing wood paneling.
"Paneling was great back in the '60s, '70s, or even '80s. Now, people are into clean exteriors," Reggie Marston, president of Residential Equity Management Home Inspections, says. He points out that you would probably have to undo all of the personal touches you added before putting your home up for sale, which could be costly and time-consuming.
"Homes for sale should look fairly neutral so the buyer can picture his or her family living there," Millians-Roche says. "If a seller redecorates to his/her taste and it is 'bold' or unique, it will definitely take away from the house."
Even those intent on living in their home forever need to make sure their upgrades are installed legally. Many major renovations require permits from your state due to the safety risks involved. Marston recommends contacting your local Building Inspections Department before completing any major renovations to ensure proper permits are obtained and you understand the safety codes thoroughly.
"Chances are illegal improvements will be flagged by a buyer's home inspector or appraiser," Cleaver says. "Then you not only pay municipal fines to get after-the-fact permits and inspections, but you've destroyed the trust your buyer has in the house -- and in anything you say about the house."
DIY Structural or Electrical Repairs
Similarly, if a project requires a professional, get a professional. And this is not only because you'll have to fix substandard work if your house ever goes on sale. Marston cites instances where shoddy do-it-yourself decks have fallen off of houses, resulting in injury or sometimes even death. Faulty electrical wiring or poor structural repairs can be just as deadly.
"Poor construction can harm the homeowner and their neighbors if, for example, a house was to catch fire," Florida contractor Kia Ricchi says. "Construction should be done by licensed and insured professionals."
Fiddling with the Floor Plan
Generally speaking, walls that are up should stay there. Railroad-style rooms you have to walk through to get to another room as well as long extended additions are prime examples of poor layout planning, says Benuska.
In line with this mode of thinking, don't add walls where there currently are none. Don't attempt to change a one-bedroom into two with a divider, either. Homebuyers will be turned off by a bedroom that's more like a crawl space.
"Original architects and builders usually had a good sense of how a floor plan should work," Benuska says. "Trying to make a house into something it was never meant to be can be a problem. Additions should be appropriate to the overall scale of the house."
Forgetting the Amenities
California real estate broker Susan Anderson once asked a client to remodel his condo prior to placing it on the market. He put in a lovely gallery-style kitchen, but there was one minor flaw: He didn't install an oven. Instead, the client opted for a small convection microwave that would meet his unique dining needs. In the oven's place, he added custom cabinets for show. But if buyers fixed the problem, they would have had to renovate the kitchen entirely. And of course, this condo never could sell. The moral? "When remodeling, make sure you include the minimum standards the average person would expect to find," Anderson says.
Granite countertops aren't the problem. It's just most of your neighbors probably don't have them. You could shell out thousands of dollars only to never see any return.
"If you took a home you purchased for $300,000 and added $150,000 in improvements, you would like to make back what you paid for the home plus improvements ($450,000), but the market in your area may only be around $350,00 for the same size home," Patrick Liska, owner of KBM Remodeling Consultants, explains.
If marble floors haven't caught on in your neighborhood, you might want to refrain from installing those as well.
Home improvements should be in tune with your neighborhood, but they also need to fit the style of your own abode as well. For example, if you own a ranch house, don't install an ornate iron doorway trimmed with gold leafing. Combining two discordant styles is what Marston calls "muddling," and it may make prospective buyers pass on your listing.
"Never make upgrades just for bragging rights," Cleaver says, referring to those coveted granite countertops. "If [they] make the rest of the kitchen look tired and shabby, better spend the money on new appliances that add flash and functionality."
So what type of renovations are actually worth your money? Angie's List recommends a proper remodel of a kitchen or a bathroom, which costs around $20,000. It will net you an 85% and 84% return on the investment, respectively, thereby increasing the value of your home.
Beyond that, decks are favorably received projects that recoup about 80% of the money you spent. And you can never go wrong with adding safety features, such as new, energy efficient windows or upgraded exterior siding, to your home. Those projects also have, on average, an 80% investment return.
*. Avoid Home Damage from Frozen Pipes from Texas Department of Insurance
Texas weather can change quickly, especially in the winter. A fast-moving cold front can cause temperatures to drop below freezing within hours. Outdoor pipes, pipes in unheated areas, and pipes that run along un insulated exterior walls can burst if the water in them freezes and expands. This can shatter pipe seals or the pipes themselves, sending water pouring through your house. You can avoid thousands of dollars of damage to your walls, ceilings, carpets, and furniture by taking a few simple measures to protect your home.
Before the Freeze
· Protect faucets, outdoor pipes, and exposed pipes in unheated areas by wrapping them with rags, newspaper, trash bags, or plastic foam.
· Insulate your outdoor water meter box and be sure its lid is on tight.
· Cover any vents around your homes foundation.
· Drain and store water hoses indoors.
· Protect outdoor electrical pumps.
· Drain swimming pool circulation systems or keep the pump motor running. (Run the pump motor only in a short freeze. Running the motor for long periods could damage it.)
· Drain water sprinkler supply lines.
· Open the cabinets under sinks in your kitchen and bathrooms to allow heated indoor air to circulate around the water pipes.
· Set your thermostat at a minimum temperature of 55 degrees, especially when you’re gone for the day or away for an extended period.
· Let indoor faucets drip; it isn't necessary to run a stream of water.
· Make sure you know where your home’s shut-off valve is and how to turn it on and off.
· If you leave town, consider turning off your water at the shut-off valve while faucets are running to drain your pipes. Make sure you turn the faucets off before you turn the shut-off valve back on.
· If you drain your pipes, contact your electric or gas utility company for instructions on protecting your water heater.
If Your Pipes Freeze
· If a pipe bursts and floods your home, turn the water off at the shut-off valve. Call a plumber for help if you can’t find the broken pipe or if it’s inaccessible. Don’t turn the water back on until the pipe has been repaired.
· If the pipe hasn’t burst, thaw it out with an electric heating pad, hair dryer, portable space heater, or towel soaked with hot water. Apply heat by slowly moving the heat source toward the coldest spot on the pipe. Never concentrate heat in one spot because cracking ice can shatter a pipe. Turn the faucet on and let it run until the pipe is thawed and water pressure returns to normal.
· Don’t use a blowtorch or other open-flame device. They are fire risks and carbon monoxide exposure risks.
If You Have a Loss
· Contact your insurance agent or company promptly. Follow up as soon as possible with a written claim to protect your rights under Texas ’ prompt-payment law.
· Review your coverage. Most homeowners and renters policies pay for property repair. In addition, most policies pay for debris removal and for additional living expenses if you have to move temporarily because of damage to your home. If you can’t find your policy, ask your agent or company for a copy.
· Homeowners policies may require you to make temporary repairs to protect your property from further damage. Your policy covers the cost of these repairs. Keep all receipts and damaged property for the adjuster to inspect. If possible, take photos or videos of the damage before making repairs. Don’t make permanent repairs. An insurance company may deny a claim if you make permanent repairs before an adjuster inspects the damage.
· Most homeowners policies do not cover loss caused by freezing pipes while your house is unoccupied unless you used reasonable care to maintain heat in the building; shut off the water supply; and drain water from plumbing, heating, and air conditioning systems.
If you have questions about insurance, call TDI’s Consumer Help Line toll-free: 1-800-252-3439
or visit the TDI website: www.tdi.state.tx.us. Assistance is available in both English and Spanish.
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