Winter 2019: The Evolving Form of Housing

Winter 2019: The Evolving Form of Housing: In this edition of On Common Ground, we report on the imbalance of the nation’s housing supply, explore its causes and possible solutions along with several emerging types of housing that show promise of delivering much needed affordable housing.

5 Things to Consider Before Listing Your Home as a Short Term Rental

As the march into winter gets underway, a lot of people are already starting to plan their spring and summer vacations. Oh, they’ll go somewhere sunny, or to a fantastic resort or maybe, if you’re lucky, your house.

They might as well, you’re going to be going on that fantastic cruise after all. Besides, you’ve heard such good things about being an AirBnB host. Your guests will end up paying for most of your trip, it’s totally win-win.

Isn’t it?

Short Term Rentals and You: The Tip of the Iceberg

Using your personal home, in whole or in part, as a short-term rental can certainly help pay the bills, but the truth is that short-term rentals also have huge issues you have to consider. It’s not as easy as listing on AirBnB and hoping for the best. You’ll need to do considerable legwork before getting started, otherwise you may find yourself in a lot of trouble and with expensive problems that eat all your profit.

Still, it can be a solution for some homeowners. Before you list, make sure you’ve considered these five things that might complicate your situation:

Does your mortgage allow you to rent the property without penalty? Many loan programs that help people buy with a low downpayments have restrictions on renting the building. If the short-term rental you’re offering was purchased with you as an owner-occupant, there is likely language in your agreement that spells out what constitutes a breach by turning your house into an “investment property.” Generally, if you rent your property for more than 14 days in a year, you risk having to face the music.

Despite what many websites may say about a lack of punishment for using your home as a rental when it goes against your mortgage agreement, breaching this agreement is serious business. Your mortgage likely has an acceleration clause that explains under what conditions your loan will essentially be revoked, with the entire balance due immediately. If you can’t cough up those hundreds of thousands of dollars, your bank will foreclose.

Find this paperwork, then scour it (and have a friend or three take a look, too) before you move any further. You should have gotten a copy at closing, check the packet the closing company sent you home with.

Do you have the right Insurance coverage? Even if your mortgage lender is ok with your using your place as a vacation rental, you’re still going to need the blessing of your insurance company. Although places like AirBnB claim to offer insurance, the word on the street is that it’s very hard to convince to pay out on claims.

Don’t risk it, talk to your agent about the best way to cover your home and property. You may want to add a comprehensive insurance policy that will cover pretty much anything, including slips and falls, or your agent may advise you simply increase your current coverage.

What do your neighbors think? The number of articles that have been written about neighbors pushed beyond the brink by AirBnB and other short-term rental guests is staggering. Even if your homeowners association and zoning allows for short-term rentals (check with your HOA and planning and zoning), if your neighbors are becoming perturbed because your guests are real jerks, you may have bigger problems on your hands.

Check your zoning, then talk to your neighbors about your goals with the short-term rental, including the timeframe in which you intend to have guests and for how long they’re likely to stay. Starting a conversation with your neighbors about your vacation rental plans before things turn into a dumpster fire can make having an AirBnB-listed property less of a dramatic situation.

It’s also important to check with your municipality about how long a guest can stay before they become a bonafide renter. In many areas, a “guest” automatically turns into a renter if they occupy the property for 30 consecutive days. You’re then assumed to have a month-to-month rental agreement, which means that you will have to actually evict them if they refuse to go quietly.

Can you refinance your property? This is a tricky question, especially with rates on the rise. Still, you may need to refinance at some point, even if it’s not today. The bad news is that many lenders won’t count the AirBnB income you’ve generated when calculating your debt to income ratios.

Luckily, there are a few banks that are capable of dealing with AirBnB income properties. Even if your lender is open to a refinance, you may be forced into a commercial loan because you rent your property out too often, effectively making it an investment property in the eyes of the bank. If you purchased using a loan eligible for a streamline refinance, you may not have to explain the AirBnB stuff at all.

Do you really want a rental? There are so many people out there that believe owning investment property is key to a better retirement, increased wealth and easy peasy income.

Owning rentals, especially short-term rentals, is a lot of hard work. From stocking consumables like soap and toilet paper to keeping things in good repair, doing background checks on applicants and keeping your taxes straight, it’s not a low-stress investment. This is why so many property owners rely on property managers to handle the day-to-day stuff.

At the end of the day, even if your PM is doing everything right, you’ll have a decent work load of your own. If you’re not all in on owning a rental, don’t do it.

AirBnB Team, Assemble!

Getting all your AirBnB ducks in a row should also include finding home pros to help in case there’s an emergency. Don’t stress, you can assemble your whole team, from a commercial insurance agent to plumbers and property management, in just a few clicks. Log into your HomeKeepr community to find the very best, most recommended experts in your area. They’ll help you ensure that your short-term vacation rental experience goes smoothly.

Sewer Line Repair for Homeowners

Your basic household drain pipe is a fairly simple device. It has one job: to take liquids away to the sewer, where water treatment experts somehow magically turn those contaminated fluids into clean ones again. The circle of inside plumbing is really kind of magical. Until, of course, something causes the system to grind to a halt.

If your sewer isn’t sewering, you’ve got big problems.

Signs Your Sewer Line Needs Attention

When your sewer line is working, you barely notice it. But when things start to go wrong, well, life gets pretty interesting. A failing sewer line can be a huge mess and a big expense that just gets worse the longer you ignore it. This isn’t a problem you can handle yourself, you will need an expert to help.

Watch for these signs if you suspect there may be a problem with the sewer line:

• Gurgling noises in your pipes
• Water backing up in the lowest drain in your home.
• Slower drainage house-wide.
• Water from one drain backing up into others.

If these things happen occasionally, you may not have a real problem, but it’s still a good idea to call a plumber to check out the sewer line to ensure that any issues are addressed before they become nightmares.

Causes of Sewer Line Failure

Sewer lines fail for many different reasons, often depending heavily on where your property is located. For example, you’d be more likely to have sewer problems due to ground shifting in an area prone to earthquakes. That’s just one cause of line failure, though. Here are some others:

• Material Failure. Although there are some clay sewer lines from Ancient Rome still intact and theoretically functional, your sewer lines are probably going to reach a tipping point where the materials begin to erode, corrode or weaken until they fail entirely. Modern materials like PVC may be able to outlive older pipes made of cast iron or bituminized fiber, but even PVC can and will fail eventually.
• Tree Roots. If you have trees and you have a sewer line, you’ve got a recipe for disaster. Large trees often have a very wide root zone that can eventually penetrate anything in the way. Roots in sewer lines is a very common issue in areas hospitable to large trees. If this is the heart of the matter, you may find that you only have intermittent problems with the line backing up. You still need to call a plumber.
• Shifting Earth. As previously mentioned, earthquakes and other natural events that cause the ground to shift can also cause your sewer line to shift. Even very heavy rains could result in pipe shifting, depending on your local soil makeup. A pipe that has shifted may end up with too little slope to carry water reliably to the sewer.
• Crushed Pipes. Although it’s uncommon, you can actually crush a sewer pipe that’s installed and actively functioning. Again, the soil makeup matters here, but you should never drive heavy machinery over your sewer lines — that extra weight is felt below the surface, too.

These are the most common causes for sewer line failure. Other very rare situations do occur and ultimately, the only way to be sure what’s going on with your sewer line is to send a camera inside to look around.

Replacing Your Sewer Line is a Big Deal

If your plumber determines that your sewer line has failed, it’s going to be a big deal. There’s no sugar coating this. Depending on what type of solution you and your plumber decide on, you may have deep trenches dug across your yard and a lot of chaos until the work is complete. However, at the end of the process, you’ll know your sewer line is in working order, so you’ve got that going for you.

There are two main methods that are used to repair sewer lines: total replacement of the old line (or the part that has failed) and relining.

Total Replacement: The Scorched Earth Approach

Having a brand new sewer pipe is worth a lot of agony, especially when you consider that most plumbers have the equipment to dig up your old sewer line, inspect it and replace the damaged bits. This is generally a less expensive method of sewer line repair, but it comes with a lot of hassle and mess.

Relining the Pipe

When your sewer line issues are minimal and involve cracked or root-invaded sections of pipe, it’s possible to reline the pipe using one of several methods, including cure-in-place and pull-in-place pipes. Essentially, what your plumber will do is recoat the inside of your sewer line with a stabilizing material. Digging is minimal, but the price is often substantially higher and not every plumber has the training and equipment to perform this task.

Paying the Plumbing Bill

Many homeowners are under the impression that the sewer line coming from their homes is the municipality’s responsibility. Those people get a very rude awakening when they learn that they are actually footing the bill. The city will absolutely fix anything going wrong in the main, a larger sewer pipe that your whole neighborhood drains into. But any drain lines from your house to the junction of your sewer line and the main sewer line is on you.

It’s a big purchase, no matter how you slice it. Right now, the national average cost for repairing a sewer line is about $2,570, with a typical range running from $1,071 to $4,078. What you’ll actually pay is based on how much work it takes to get to your sewer line, as well as the remedy you choose, from partial replacement to cast-in-place pipe.

Where Do I Find a Plumber I Can Trust?

It can be difficult to know if the plumber you’ve put your faith in is as good as they claim. But, when a friend recommends a plumber because of their experience working with them, you know that’s a person you can believe in. This is the philosophy behind everything we do at HomeKeepr. Just log in, ask your community who to call for the type of sewer repair you want to have done and before you know it, that failed line is brand spanking new and flowing like a champ!

Metro votes to expand growth boundary

Metro votes to expand growth boundary: The Metro Council voted 'yes' on expanding the urban growth boundary that will allow thousands of acres of land to be developed in Beaverton, Hillsboro, Wilsonville and King City.

Oregon Youth Who Died Leaves Behind A Gift For Family: A New Home

Oregon Youth Who Died Leaves Behind A Gift For Family: A New Home: In Madras new houses are dedicated to farm workers, built by young people who learned the tools of the trade as they went.

Your Need to Know Guide to Buying a New Home

If you’ve been following along, you know that last time around we covered a lot of the important things you should be thinking about when buying an older home. They’re great, but they can also be expensive and needy — definitely not for everybody.

Today, we’re looking at buying a new construction home. Although it’s a chance to get the house you’ve long wanted, buying a brand new house can also be fraught with problems.

New Construction Homes and Their Builders

There are no two ways about it, a new construction home can be the best decision you’ve ever made. Not only are they up to current building codes, they’re well-insulated, nothing needs to be fixed — all you have to do is move in and keep your new house clean.

There are essentially two distinct types of builder: custom and speculative.

Custom home builders wait for a person who wants a house built to come along, then they work closely with the home buyer, architects, electricians and other home pros to create your dream home. That being said, custom home builders tend to be on the upper end of your local housing market, but some also cater to people who want a smaller home.

Speculative builders (also known as production builders) build a bunch of houses and hope someone will come to buy them. These folks are generally responsible for creating whole neighborhoods out of thin air. One day, you’re driving by a field, the next week it’s a 100-lot development with 20 houses already going up. Speculative builders are nothing if not fast. You won’t necessarily get the house of your dreams unless your dreams are pretty vanilla, but you will have a home that’s new, up to code and that will keep you out of the rain. Super important, that.

New Construction Pros and Cons

You may be considering a new house, but aren’t sure you’re totally willing to wait for one to be finished. If only there were a place you could get an overview of the pros and cons of buying new. Wait, there’s a list below!

Pros of New Construction:

Owning a brand new house is a pretty sweet deal for most people. Here’s why:

• Low maintenance requirements. A new house is, well, new. From the bottom to the top, everything is yours to break in. What this means for you is that you can expect to have several years to ease into learning how to do home maintenance and the bigger ticket items like your air conditioner condenser won’t need replacing (with normal use) for at least a decade.

• Warranties on pretty much everything. Did you know that most new homes come with a warranty? Sometimes it’s a builder’s warranty, meaning the builder themselves will fix any problems that crop up during the specified period. Sometimes it’s a home warranty through a warranty company. Either one will help you sleep better at night knowing that you’re not on your own if something breaks.

• Less risk of neighborhood blight. Unless you buy an infill home (a new house that’s built in an older neighborhood), new homes virtually guarantee you won’t have to worry about neighborhood blight for a while. Blight can occur in any neighborhood, but it’s far less likely where most of the occupants are owners and the houses are all the same age. It’s the ultimate in peer pressure, really.

• It’s a blank canvas. Your new home has never been lived in by anyone, ever. You probably realize that, but it can still be sort of a shock to know that you are the one who will start this particular home on its road to being a quaint and charming place fifty years down the road.
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New House Drawbacks:

Of course, a new house isn’t for everyone. There are a few drawbacks to building from the ground up, including:

• Higher monthly costs. Unlike an older home, where you may find an owner who just wants to get out from under their loan so they can move across the country, a brand new house is pretty much priced where it’s priced. You’ll have to pay what the builder is asking if you want it, which may push the price of your house to the top of your price range. If you request any changes to the plan of a home in progress, or one that hasn’t had the ground broken yet, you may be asked for a larger escrow deposit in case something happens to prevent your being able to close when the house is finished.

• It’s a blank canvas. As noted above, a new house is a blank canvas. For some people, this is pretty intimidating, since that also means that more often than not, there’s not a lot in the way of storage systems or other handy aftermarket items that houses that have been lived in are generally fitted with. You can ask your builder about closet systems that go beyond a single bar for hanging clothing, but generally you’re better off to install these yourself so you can get exactly what you want.

• You’re probably subject to an HOA. There’s nothing inherently wrong with a homeowner’s association, but it’s an additional cost that you may not have budgeted for. The additional amenities that an HOA provides are often worth the extra spend to homeowners, but if you’re already tight, it’s going to make things even tighter.

• Flexibility is key. Building a house is an exercise in patience. Sure, you think you’re going to be able to move in on February 1, but sometimes things get in the way and construction is delayed. You’ll need to be flexible, otherwise you’ll drive yourself crazy trying to guess when you’ll have the keys.

New Year, New Home?

If you think a new home is for you, your Realtor can recommend some great home builders in your area. Just log into the HomeKeepr app and ask for a connection! Your HomeKeepr community can also help you connect to home pros like interior decorators and architects, the kind of people who will help you and your builder turn pile of lumber into a home you’ll love for a long time.

...Housing Trends eNewsletter- LaTasha Hershey

...Housing Trends eNewsletter- LaTasha Hershey

Your Need to Know Guide to Buying an Older Home

For a lot of homebuyers, buying their dream home means choosing an older structure that has passed the test of time. These grand places have an undeniable charm about them, with classic styling that can be adapted to nearly any taste. Older homes can be incredible places to live and love, but no home is perfect. The history of your older home may include skeletons in the upstairs bedroom closet.

Five Amazing Reasons to Choose an Older Home

Buyers who are into the details are going to love owning an older home. Not only do you get all those little bits of period hardware, real wood floors and intricate trim work, your home has a real history that you can trace should you be so interested. Older homes can become a real love story really fast.

There are a lot of reasons to choose an older home, here are five to get you started:

The neighborhood is established. You may not be giving any thought to this particular item right now, but when you’re living with the sound of bulldozers, skid loaders and other heavy equipment nearby as they add even more streets to a newer neighborhood, you might wish you had gone another way. Established neighborhoods don’t give you a lot of room to move, but you also know exactly what to expect day to day.

Mature landscaping! Even if you’re not a gardener, you can appreciate that 50 or 80 year old shade tree that protects your house like a giant leafy umbrella. If past owners put in plants, you may also have bought into a hedge or foundation plantings that will give you lots of green without lots of effort.

High ceilings. Although the types of ceiling treatments that are in modern homes rarely pop up in older homes, you may find high ceilings in older homes (this will depend on how old of a house you’re looking for). Before air conditioning, those high ceilings helped keep occupants cooler in the summer. Today they give you a more spacious atmosphere and more room for vertical storage.

Lots of natural light. One of the best features of many older homes is the sheer number of windows that have been installed. So many windows means so much more light inside your home. When you’re buying a glass house, though, make sure that those windows have been replaced or brace for high winter energy bills.

You become part of the story. Older homes tell the story of the lives of past owners, in small and large ways. Every owner left a mark somewhere in that place, just like you will. For example, you may decide you’re not so fond of the carpets, instead choosing to recover the wood floor underneath. Your fingerprint was just added to the collection.

Owning an older home can be a home ownership dream come true. But don’t fall headfirst yet. Read on so you know when to walk away.

Five Reasons to Reconsider That Older Home

Although older homes can be charming and even decadent with the details, there’s a lot more to them than history and natural light. Every house is the result of its cumulative care over its lifetime. The longer the house has been around, the more care (or neglect) it receives. Even so, there are many reasons to be wary when it comes to buying an older home.

Vital systems may not be to code. When that house was built in 1940, there weren’t really building codes to adhere to. In fact, that house might have come from a catalog and was shipped in pieces for a homeowner to build like a giant Lego set. The fact that it’s still standing is probably a good sign, but you’ll want to have a very thorough home inspection before you get your hopes up too high.

Owners adding defects when trying to repair things. Homeowners regularly make repairs without the proper permits or inspections, leaving you to wonder how good the work really went. Whether the repair was made in the 60s or last week, discovering that a closet light was wired using lamp wire is a terrifying discovery that should leave you wondering what other “repairs” are hiding behind the wall, in the attic and under the floor.

So many windows means thermal leakage. All that natural light is awesome, until it gets cold or hot — then you’ve suddenly got a major issue with thermal leakage. Even the best weather seal isn’t much on a single pane window when compared to modern engineered double and triple paned windows with Low-E coatings. If you like a drafty house, by all means go for it. If not, at least look for a place with upgraded windows.

Add-ons should get the side eye. Above we discussed how each owner touches a house in a unique way. One of those ways is to add more square footage. There are good add-ons that flow seamlessly from the original structure to the new part without it being obvious. Then there are the others. Does this place have something that’s akin to a shanty attached to the back side and called a bedroom? Run away.

Infestations. Another gift former owners may leave you is pest infestations. From bats to cockroaches and mice, older homes are accidental havens for all sorts of creatures. Along with a termite inspection, you definitely want to have a pest control expert out to look for signs of other things that you’d probably rather not be sharing your home with.

Living in a remodeling zone is not a party. Some people gravitate toward older homes because they believe this will save them a lot of money. There’s certainly a chance of that, but market forces are finicky, so you definitely want to talk to some pros before putting the numbers together. Even if you do find that you’re sitting on a gold mine, consider what this is going to do to your life and family. Living in a construction zone means that you never get away from the destruction and that you’re potentially dumping a lot of money into upgrades and fixing old “repairs.”

Is an Older Home Right for You and Your Budget?

It’s one thing to dream a little dream and yet another to turn that dream into a reality that may have unforeseen results. This is why it’s really important to talk to your Realtor and other home pros before making an offer on an older home.

Not sure where to find the pros you need to take a look at your potential future home? Visit your HomeKeepr community!

Your Realtor is already there and they’ve recommended the best home inspectors, pest inspectors and other home pros that they know. With just a few clicks you can surround yourself with experts to help you decide if it’s worth the effort and money involved to live your old house dream.

Housing prices drop in Portland, national sales down

Housing prices drop in Portland, national sales down: Across the United States, the number of newly built homes has gone through the roof - but many are sitting on the market without buyers.

Weekday Mornings Are Hot for House Hunting

Weekday Mornings Are Hot for House Hunting: A new survey finds home shoppers are likely searching online for homes during their workday.

Home affordability watch: price tags in midsize metros

Home affordability watch: price tags in midsize metros: Big coastal cities have some of the highest house prices in the country. In comparison, medium-size cities are often relative bargains. But not always.Each quarter, NerdWallet calculates home affordability for 172 metropolitan areas for which the National Association of Realtors publishes home price

Buying and selling a home will become more difficult in 2019

Buying and selling a home will become more difficult in 2019: Buying and selling a home is about to get a lot more difficult in 2019, or so says one expert in her forecast for next year. Realtor.com's forecast outlined what the market will look like for both homebuyers and sellers in 2019.

Your Step-By-Step Guide to Mortgage Pre-Approval

If you find yourself sitting in a strange hallway, waiting for a stranger in a suit to size you up and decide if you’re worthy as your palms sweat and your breath gets just a little bit harder to push out, you might be waiting for your appointment for your mortgage pre-approval. You’re one step closer to owning your own home, but this one is a doozy.

Let’s talk mortgage pre-approval step-by-step.

Step One: Mortgage Pre-Qualification Versus Pre-Approval

You probably already have a pre-qualification letter saying that you can probably buy a house in a particular price range, so why isn’t this enough? A lot of homebuyers find this part of the process confusing, and frankly, it can be. Your pre-qualification was probably done over the phone or on your first meeting with your lender. They asked you a bunch of questions about your income, your job and maybe even pulled a “soft” credit report to get some idea about your debts.

Based on this information, they gave you the details on the kinds of programs you’re eligible for and how much you can expect in buying power. You probably got a letter that you could show your Realtor to help guide the buying process. The difference between the pre-qualification and the pre-approval is simple: a pre-qualification is based largely on your word. If you give the lender incorrect information, they’ll give you a pre-qualification letter that’s not right.

A pre-approval, on the other hand, takes a harder look at your background, work history and requires a full credit report and FICO score to ensure that you can, in fact, pay back a note.

Step Two: Documentation

Your next meetup with the nice banker is going to be to deliver documents, provide consent to pull a full credit report and, if you’ve already found one, give them the information on the home you’ve put under contract (in some areas your Realtor can do this last bit for you).

Documentation you’ll be asked to bring will include pay stubs, bank statements and tax returns, along with other information that may be needed to verify your income source or sources. Self-employed people, for example, are sometimes required to prepare profit and loss statements (or just pony up more tax returns). If you have assets like a 401(k) or even a CD, you’ll want to bring the details on these, too.

Step Three: The Loan Estimate Form

You’re going to get a copy of something called the Loan Estimate Form, probably at the same meeting where your lender pulls that full credit report and takes all your papers away. This form explains exactly how much they expect you’ll need to bring to closing, along with itemized estimated fees to plan for at closing. If you’re shopping your loan, collect these and compare them side by side before you make your final choice.

But don’t spend too much time crunching the numbers. Just like your contract (and the National Association of Realtors) says, “Time is of the Essence.”

Step Four: Acceptance

Once you’ve had a few minutes to review the paperwork and you’ve made your final pass through the numbers, all that’s left is to call the lender you’ve chosen and let them know you need that pre-approval letter faxed over to your Realtor.

Understand that a pre-approval is not a guarantee that you’re going to get the money you need to close. Several things can go wrong along the way through underwriting, including, but not limited to:

– Unverifiable income (this is often due to issues with overtime)
– A change to your credit score.
– An increase in your debt to income ratio
– An undocumented change in employment
– Assets that are unverifiable

The best plan is be totally honest with your lender when you get your pre-approval so that you don’t get a last minute call telling you that your loan has been denied (this actually happens, so pay everything on time and don’t take out new credit lines or add to old ones until you’ve got the keys in your hand).

When is the Best Time to Make an Offer?

Ideally, you should have a pre-approval letter in hand before you so much as set foot into the first house you’re considering for purchase. After all, the seller isn’t going to think you’re all that serious without one, nor will they be keen to want to negotiate under these circumstances.

Help your banker help you get the best deal on the house of your dreams, save everybody a lot of headaches and get that pre-approval first. Knowing how much your closing costs are going to be will also help your Realtor write your contract accordingly if they should need to be wrapped into your mortgage.

Basically, that document is the key to everything. So, no pressure.

When You Need a Loan for Your Home…

Finding a banker you can trust these days couldn’t be easier! Check out the lenders that your Realtor has already recommended within your very own HomeKeepr community. These are banking pros that your agent has worked with enough that they know they can do the job and will make sure you don’t get a big surprise a few days before closing.