The Skanner News - Report: One in Three Oregonians Struggle to Afford Housing

The Skanner News - Report: One in Three Oregonians Struggle to Afford Housing: The Skanner News is an award-winning media organization consisting of a printed newspaper and a web site featuring more than 25,000 news stories. We publish original journalism and commentary covering Portland, Seattle, and the Pacific Northwest, as well as news stories from the Associated Press. The Skanner News has served the public with timely information in the Portland, Oregon edition since October 1975 and the Seattle edition since 1990. The publisher is a past two-term president of the West Coast Black Publishers Association as well as a member of the National Newspapers Publishers Association.

Your Home Buying Score Card: Find Out What You Really Want

Buying a house is a confusing process. Not only is there a lot of material to process, you really have to do a lot of introspection to find the house that’s right for you and your family. It’s about more than just ceiling treatments and square footage, there’s something else, too.

Irish poet Thomas Moore may have captured that little bit of something else best when he penned these lines:

Sometimes, the spirit of a place is so strong, you may think you see its face and glimpse it gamboling over a field or peeking out of a forest. This spirit we sense in each locality would once have been described as the scintilla or spark of its soul, the pearl in the oyster. It accounts for the magic of a region, and, without it, an acute sense of place dissipates into a vague and lazy feeling of nowhere.

Maybe you’ve not started your home search yet, so you’ve yet to experience this strange phenomenon, or maybe you’ve just seen a few homes and they just didn’t strike you. Either way, it’s important to take stock of what it is that really moves you so that you can narrow your list of prospective homes and get the perfect fit sooner rather than later.

Home Is Where the Investment Is?

Home buyers should never think of their primary home as an investment first, but you should keep in mind that you might need to sell one day. Because of that, you need to think a little bit like an investor and a little bit like a love-struck teenager. It’s ok to be both. Before you step foot into a single house, figure out where you need to buy.

If you live in a large metro area, this may mean narrowing to within a few suburbs or choosing some urban neighborhoods that you really feel drawn to (and are holding their value). Some people go one step further and narrow by schools, especially if they have children. Even people without kids can benefit from the extra value good schools bring to the immediate neighborhoods surrounding them, though.

Now that you’ve narrowed the initial list, you can create a checklist to help you decide what it is that you want in a house so you don’t waste time with homes where you’ll never feel the spirit of the place.

Your Home Buying Scorecard

This exercise is meant to help focus your home search, but you should also realize that it’s highly unlikely you’ll be able to get everything you want out of one house without an incredible budget or very low standards. To the scorecard!

When shopping for a home, it’s useful to start your search online for houses in your price range to see what sort of features they usually have. For example, if a $250k house in your area tends to have a fireplace or a ceiling treatment or a two car garage, you know you can reasonably expect that. You’ll probably also realize about 20 houses in that your expectation of acreage or a private movie theater is a little out of reach.

Grab your tablet or a piece of paper (if you’re into that sort of thing) and draw four columns. Label them like this: Definitely Need, Want, Can Live Without and Definitely Don’t Want. If you have a spouse or other person you’re buying with, make sure they make their own scorecard — no sharing answers, please.

Now for the really hard part. You need to fill those columns in.

This isn’t an exercise that you should finish in five minutes or ten minutes. You should spend a good week or two really working on it. Think deeply and about the long term. A few questions you may want to ask yourself include:

* Do I intend to age in place? In this case, you might want to put stairs in your “don’t want” column, since it can be difficult to navigate them as you age.
* Am I planning to start a family? You’ll want a bigger house, make sure there are enough bedrooms for all your future kids.
* Is there a style of house I’m attracted to? Open floor plans are big right now, but they’re not for everybody. If you hate them, write it down!
* Would I use a fireplace if I had one? Fireplaces can be nice, but they can also be huge pains to maintain and keep safe. If you won’t be using it, you might as well not pay extra for a house that features one.
* Do I plan to have pets? Hard surfaces are a must for pet owners. Carpet is cleanable, but it will never hold up like a tile, hardwood or laminate floor when pets are involved.
* How close can I tolerate my neighbors? For many people, it’s no big deal to be piled on top of the next house, but for others it gets downright uncomfortable. If you need room to roam, a cul-de-sac lot or other irregularly shaped lot may give you some elbow room without the added expense and upkeep of buying an acreage.

As you start to take inventory of your actual wants and needs, you’ll also be eliminating huge swaths of houses in single blows. This makes your home search a lot easier, believe it or not. Don’t narrow so much that only that house at 123 Marigold Lane will do, but do spend some time really thinking about your perfect home.

When your scorecard feels pretty complete, make sure to compare notes with your spouse (wait until they’re done, of course). You may have some compromising to do, especially if you’re dead set on a house with a pool and they want a small yard with nothing in it. With all of the details decided, you can finally call your Realtor and declare that you know what you want! They’ll appreciate the effort you’ve taken to doing the homework ahead of time.

Your Next Stop: Home Inspections and Home Repairs

Once you have that one house chosen, the one where you feel the spirit of the place tugging at your sleeve, you’ll need a good home inspector and someone to make whatever minor repairs they recommend. No worries, just pop into the HomeKeepr community and check out the home pros that your Realtor has already recommended. You know they’ve got to be good, otherwise your agent wouldn’t have put their own reputation on the line!

7 Most Affordable Small Towns in 2018

DAILY REAL ESTATE NEWS | MONDAY, MARCH 19, 2018

For your clients who enjoy the perks of small-town living, realtor.com® researchers have identified the best places to call home—and the Midwest reigns supreme. Realtor.com® came up with its 2018 list of most affordable small towns by  factoring in the cost of housing, employment, and safety.

Millennials have love for small towns, with about 21 percent of home buyers ages 37 or younger purchasing a home in a small town compared to 16 percent a year ago, according to the National Association of REALTORS®. “The benefit of moving to a small town is that your housing dollars can go a lot further,” says realtor.com® Chief Economist Danielle Hale. “While maybe you could get a tiny condo in the city, you can get a bigger house and land to spread out in a small town. You might even find a home with fun features like a porch to [entertain] your friendly new neighbors.”

Realtor.com® ranked the following as 2018’s top seven affordable small towns—all with populations under 40,000:

1. Logansport, Ind.

• Median home price: $62,700 

2. Mexico, Mo.

• Median home price: $69,600

3. Guymon, Okla.

• Median home price: $76,000

4. Defiance, Ohio

• Median home price: $86,500

5. Albert Lea, Minn.

• Median home price: $99,200

6. Emporia, Kan.

• Median home price: $99,800

7. Lexington, Neb.

• Median home price: $110,700

Source: “Top 10 Affordable Small Towns Where You’d Actually Want to Live, 2018 Edition,” realtor.com® (March 19, 2018)

Oregon county approves scaled-back rural housing zone

Oregon county approves scaled-back rural housing zone: Oregon’s Douglas County has approved a scaled-back plan to allow more rural housing on land currently zoned for farm and forest uses.The change to the county’s comprehensive land use plan would allow 20-acre home sites to be carved out from 22,500 acres in mixed farm-forest zones, down

How to Lower Utility Costs for Any Home

DAILY REAL ESTATE NEWS | FRIDAY, MARCH 16, 2018

Your clients may be able to decrease utility costs with just a few energy upgrades and tweaks. “There are so many small changes people can make to improve the energy efficiency of their homes, and it all adds up to significantly lower energy bills and a smaller environmental footprint,” says Christina Kielich of the U.S. Department of Energy. Kielich and home energy auditor Erlend Kimmich offered the following tips on Curbed.com about how to cut energy costs in a home, including:

Replace lightbulbs. The typical American household spends 5 to 10 percent of its energy budget on lighting alone, according to the DOE. Replace incandescent lightbulbs with LEDs, which on average are 85 percent more energy-efficient. You can shave $100 a year on your energy costs by making the switch.

Unplug. Leaving cellphones, TVs, computers, and other electronic devices plugged in can continue to pull power from the grid. That can add up over time. Unplug devices or plug your electronics into power strips that you can easily turn off whenever they’re not being used.

Use an automatic thermostat. Save up to 10 percent on your annual heating and cooling costs by just dropping the thermostat 7 to 10 degrees Fahrenheit from its normal setting for eight hours a day. An automatic thermostat, which can be purchased for just $18, can help to more easily adjust the thermostat during the day and cut energy use, too.

Seal your attic and basement. For a more substantial investment, seal and insulate the attic and basement—basically the top and bottom of your home, says Kimmich. “Especially if the house was built before World War II, that’s where you tend to find the most leakage,” Kimmich adds. “Think of your home’s air sealing and insulation like a windbreaker worn over a sweater. If there’s a rip or you leave the windbreaker unbuttoned, it can’t really help. So we fix the sweater by making the insulation more substantial and we improve that air seal anywhere the indoor space is connected to the outdoor space.”

Get more tips from Curbed.com and view the DOE’s instructions for DIY jobs like sealing air leaks with caulk, which could potentially offer energy savings of 10 percent to 20 percent.

Source: “How to Make Your Home Energy Efficient,” Curbed.com (Feb. 23, 2018)

4 Tax Deductions for Sellers

DAILY REAL ESTATE NEWS | THURSDAY, MARCH 15, 2018

Some tax deductions for home sellers may amount to potentially big savings. As such, homeowners who are selling their home soon or sold it last year will want to educate themselves on the tax deductions available. Realtor.com® recently highlighted some, including:

Selling costs: “You can deduct any costs associated with selling the home—including legal fees, escrow fees, advertising costs, and real estate agent commissions,” says Joshua Zimmelman, president of Westwood Tax and Consulting in Rockville Center, NY.

Home improvements and repairs: Some renovations done to make a home more marketable for resale may be eligible for a tax break. “If you needed to make home improvements in order to sell your home, you can deduct those expenses as selling costs as long as they were made within 90 days of the closing,” says Zimmelman.

Property taxes: You can deduct the amount you paid in property taxes for the time you owned the home. This has been capped at $10,000 in total deductions, starting in 2018, however.

Mortgage interest: You can deduct the interest on your mortgage for the amount of time you owned the home. Starting in 2018, new homeowners and sellers can deduct the interest on up to $750,000 of mortgage debt. Homeowners who had a mortgage prior to Dec. 15, 2017, can continue to deduct up to $1 million under the old law, Zimmelman says.

And don’t forget a tax exclusion still available to home sellers on capital gains. Capital gains are your profits from selling a home. Those profits are taxed as income, but you can exclude up to $250,000 of the capital gains from the sale if you’re single and up to $500,000 if filing as a married couple. To be eligible, you must have lived in your home at least two of the past five years.

Source: “5 Sweet Tax Deductions When Selling a Home: Did You Take Them All?” realtor.com® (March 8, 2018)

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Look at Your Home Through a Buyer’s Eyes: Making Your To-Do List

Selling your home is one of the most tricky parts of owning a home, really. There are always little projects that you meant to get to and didn’t, and things that probably weren’t perfect, but didn’t bother you enough to fix. You can’t possibly do everything to make your house like new before putting it on the market, but there’s a minimum level that most buyers will expect.

How many of those things left on your “to do” list absolutely need to become “to dones?”

Getting Ready to Sell that Home Sweet Home

Before you get too serious about selling, it’s a good idea to have your Realtor over for a quick walkthrough. They can give you a punch list of items they think should be updated, fixed or addressed in some other way before you sell your home. You never know when the right buyer will walk through the door, your house needs to be ready to go from the moment you put it on the market. Putting your best foot forward is key to sales success.

That doesn’t mean you need to completely gut and remodel your home, but you should make sure everything is in proper working order and ready for a new occupant. That can be a lot to wrap your head around, though. If you get overwhelmed, start with the list below.

Entry / Living Room

For most homes, the living room and foyer are a combo unit, but if yours are separate understand that this same advice applies to both. The moment that door opens, and even before it does, your potential buyers are forming an opinion of your home. What the open door reveals had better pack a punch (or at least not terrify them).

Make sure that the windows are very clean to let in as much light as possible, that all your light bulbs are in good working order, the flooring is clean and in good shape, any tile grout is intact and the walls are flawless. A neutral color is always a good idea, but white is kind of a turn-off for a lot of buyers. Blues, light grays, beige and creams are all good choices for paint colors.

Dining Room

Your dining room should follow the same advice as your living room, with one exception. Since there’s probably some amount of eating that happens in this part of the house, you’ll want to check the flooring to ensure there’s no staining or spots under the table.

This is a particular problem if there’s carpet. Do not attempt to cover spots with a rug, this could be considered a “hidden, latent defect.” Basically, it means that you’re hiding damage from a potential buyer. That’s a big fat no go.

Instead, call a professional carpet cleaner (you can meet one in the HomeKeepr community!) or just own it and try not to panic if the buyer asks for the carpet to be replaced or cleaned before closing.

Kitchen

The list of things in your kitchen can be long, but we’ll try to make it reasonable. Check all the items on this list, one at a time:

Appliances that stay with the home
• Are they fully functional?
• Do they have an attractive appearance?
• Do they match one another?
• Are they clean?

Kitchen sink area:
• Is the sink free of damage?
• Does it drain well?
• Does the disposal work?
• Does the sprayer work?
• Is the faucet leaking?

Counters, backsplash and cabinets:
• Do the counters have worn or burned spots?
• Are there grouted areas that are needing regrouted?
• Do the cabinet doors open and close properly?
• Is there water damage anywhere?
• Is everything clean and not tacky to touch?
• Do the cabinets have worn finish?

Bedrooms

Bedrooms are by far the hardest, especially if you have kids. If you’re going to have to live in the house until you find a buyer, invest in some storage systems — they’ll pay off in the long run. Organize everything as best you can to give the rooms the appearance of more space, clean the windows, install the lightbulbs, clean the carpets and instruct everyone to keep it tidy. If anything can be moved out to a storage unit, do it.

Bathrooms

Bathrooms are much like kitchens, they have a lot of wet, moving parts. That being said, they also have basically the same punch list. The only addition would be the shower or tub units. Check the faucets and showerheads for leakage and make sure there’s no mold on your tub or shower surrounds. Clean that stuff within an inch of its life and if you can’t get rid of the stains, recaulk. It’s an easy way to make that tub or shower look like you’ve never even used it.

Garage

There’s not a lot to do in the garage, but do make sure your door opener is functioning properly, that the wheels on the door are lubricated if it’s making a terrible sound when you open it or close it and that you’ve tidied the things inside as best as you can. If you don’t really use your garage, you can dress it up a lot by applying an epoxy coating to the floor. The DIY kits run around $100 and, although they don’t add any value to your home, they’re far more impressive than an old, stained concrete floor.

General Indoors

Overall, it’ll help a lot if you run around your house and make sure that all your lightbulbs are fresh, all the windows are cleaned, you remember to leave the blinds open during the day and that the paint makes each room feel bigger. The key is to bring in more light and then use lighter colors to keep it bouncing around the room. A new coat of white ceiling paint won’t hurt your efforts, either.

Paint is great for a lot of reasons. It can seal in smells you might have never noticed, as well as giving the house the scent of fresh construction. That smell paints a picture for a buyer that says this house has been taken care of and they can trust that it’s in great shape!

General Outdoors

When it comes to the great outdoors, keep your lawn mowed, trim your hedges, clean up any projects that you started and never finished. Landscapers, trash haulers and metal scrappers can help a lot with these tasks. You’ll also want to check out your roof and gutters to make sure they’re in good shape because your potential buyers will be doing the same thing.

The first thing a buyer sees is the view from the street, make sure you run out there during the outdoor prep work to check your look. When you start to wonder if you should actually sell this amazing house at all, you’ve probably got the curb appeal knocked out.

When You Can’t Get It All Done

You don’t have an unlimited timeline, that’s completely understandable, but your home should be ready to sell if you want to get top dollar. If you can’t do the work, just call on someone who can. Your HomeKeepr community is full of professionals who can do specific tasks like cleaning your carpets or help with more general things on your list, like ensuring the whole kitchen is in ready-to-show condition.

Log on, search for the home pro you need right now and let them take it from there. You know they’re going to do great work because your Realtor recommended them!

Most Markets Near Peak; No Signs of Bubble

DAILY REAL ESTATE NEWS | MONDAY, MARCH 12, 2018

Home prices in most U.S. housing markets are reaching their peak, but there’s no need to fear a repeat housing bust, according to a new joint analysis by Florida Atlantic University and Florida International University. Throughout the majority of the country, home prices have been rising steadily since 2012, and there are signs the runup may be starting to slow.

“Housing markets are slowing, suggesting that we are nearing a peak in housing markets around the U.S.,” says Ken Johnson, a real estate economist at Florida Atlantic University. “But this is good news, as we are pulling back from the brink, unlike we did in 2007.”

Researchers at the universities created the Beracha, Hardin & Johnson Buy vs. Rent Index, which shows that out of 23 metros areas studied, 13 are slightly to moderately in “buy” territory. That means owning a home is more favorable than renting for the majority of residents in that area. On the other hand, 10 metro areas were slightly to moderately in “rent” territory.

“Our data indicates that prices are above their 40-year trend but not significantly so, as they were in 2007,” says Eli Beracha, co-creator of the index and associate professor in the Hollo School of Real Estate at FIU. “Rather than a crash, I anticipate slower growth in prices accompanied by longer marketing times for sellers and increasing inventories, which should bring prices back in conjunction with their 40-year trend.”

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3 Smart Strategies for Investors

DAILY REAL ESTATE NEWS | MONDAY, MARCH 12, 2018

Investors can see big returns on real estate, but the most successful tend to have a strong understanding of how to evaluate their options before purchasing. Forbes.com recently highlighted some winning strategies for profitable real estate investing:

1. Focus on potential income, not personal like and dislikes. Purchasing an investment property is different than buying residential real estate. Investments need to center on the numbers—the combination of the purchase price, estimated renovation costs, expected rental income, and market conditions that can support a purchase decision.
2. Don’t buy on future appreciation. You can’t trust that rents and home values in your area will always increase over time. Buy based on current returns, not what you think the future may hold, according to Forbes.com. The best deals are those that can make you money from day one—and where long-term appreciation just happens to be an added bonus.
3. Set aside extra funds. Several smaller ongoing operating expenses will be inevitable. Investors will want to budget for those, as well as possible bigger items, such as a new roof or HVAC unit. These projects can cost thousands or tens of thousands of dollars. Set money aside on a regular basis to cover these expenses as they arise. Also, investors will want to put aside extra money in case there are any vacancies in their rentals.

Source: “Seven Secrets to Successful Single-Family Rental Real Estate Investing,” Forbes.com (Feb. 26, 2018)

The Skanner News - New Law Makes It Easier to Remove Racist Restrictions From Property Deeds

The Skanner News - New Law Makes It Easier to Remove Racist Restrictions From Property Deeds: The Skanner News is an award-winning media organization consisting of a printed newspaper and a web site featuring more than 25,000 news stories. We publish original journalism and commentary covering Portland, Seattle, and the Pacific Northwest, as well as news stories from the Associated Press. The Skanner News has served the public with timely information in the Portland, Oregon edition since October 1975 and the Seattle edition since 1990. The publisher is a past two-term president of the West Coast Black Publishers Association as well as a member of the National Newspapers Publishers Association.

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7 Tips for Saving More on Your Next Remodel

In 1986, Tom Hanks starred in a movie called “The Money Pit.” It was all about a couple’s adventures in remodeling what has to be the worst house ever. Even though it was a comedy, if you’ve ever been part of a big remodel, some of the situations the co-stars find themselves in (re: the remodel, not the rest of the story, which is clearly irrelevant) are way too familiar. Too little money, problems becoming bigger than initially assumed and chaos, chaos, chaos.

But you aren’t going to jump into a money pit worthy remodeling project. Oh no. Not when there are so many awesome ways to avoid it.

Remodeling is Always More Expensive Than You Expect

If there’s any hard and fast rule of remodeling, it’s that it’s always more expensive than you think it’s going to be. Even professionals tend to build some padding in to accommodate the unknown. The older the house and wider the scope, the bigger the padding.

Although building regulations have been around since the early twentieth century, they were inconsistent across the country and poorly enforced. It wasn’t until 1997 that the International Building Code was first published, finally creating a building code that was uniform across participating countries.

That’s a little background about why so many older houses are full of surprises you get to uncover when you start to remodel them. It really helps to go into a remodel with a savings mindset if you’re going to stay under budget.

Get Ready to Save Some Money: Tips to Get You Started

Remodeling can be a huge process, but if you’ve got the intestinal fortitude for it, it can be an incredible experience to be involved with. No matter if you hire most of the work or just hire the work that requires a permit, you may be able to save more on your job by trying these tips!

1. Reduce, Reuse, Recycle to Save More. Whoa, whoa, whoa. Take that trim out carefully, you can reuse that stuff! Although more narrow types of trim like quarter round can be pretty fragile, wider crown molding or tall base moldings are great candidates for recycling, for example. Cabinets, tiles, sinks, tubs, light fixtures and most materials, really, can be recycled in some way.

2. Paint Can Give Materials a Face Lift. Hate that wooden trim? Is the wash on your kitchen cabinets unbearable? How about that wood paneling? You don’t have to rip them out, all you need to do is sand them lightly, apply an appropriate primer and carefully paint them. Suddenly you’ve got a whole new look!

3. Replace, Don’t Relocate. When you’re remodeling rooms like kitchens and bathrooms, it’s tempting to move toilets, sinks and dishwashers — but don’t! Instead, work around their existing locations, since moving your plumbing (as well as electrical) can be very expensive and may require that you bring your house up to current code, adding even more cost to the remodel.

4. Check Out Sales, Coupons and Scratch and Dent. When it comes to appliances, especially, scratch and dent sales are one of the best places to find deep discounts. Big home improvement stores tend to get a lot of returns and typically there’s nothing else really wrong with the appliance. There may be a small scratch on the side or top, but if it’s not too obvious or it’s the sort of injury you’re likely to inflict on your appliance moving it into your house, there’s no reason to spend an extra $500 on that fridge.

Sales and coupons come around on a regular basis. Wait for them. Be patient. Collect the stuff you need for your remodel ahead of time, that way you’ll be ready and have saved a bundle on all those big ticket items!

5. Discount Material Stores Can Yield Fruit. Discount material stores often get bulk shipments of odds and ends that larger retailers couldn’t move in a reasonable amount of time. Sometimes this means that they’ve got big stacks of avocado green tile, sometimes it means they have just enough high grade laminate flooring for your living room. Make sure you know how much material you need before you go into a discount material store, usually it’s a one shot situation. Once they’ve sold out of the material, it’s just gone.

6. Look for Ads Selling Used Materials. Remodelers and homeowners often put bigger ticket items up for sale when they’re being replaced, especially if they seem to have a reasonable amount of life left in them. Windows, pavers and excess materials from projects are popular things you’ll see in online and offline ads. You’ll need to make sure the used materials you buy are right for your remodel, but otherwise, this is a great way to save.

7. Use Your Material More Efficiently. It might seem sort of obvious, but the more efficiently you use your materials, the less you’ll need and the more you’ll save. This means planning all your cuts ahead of time, being mindful of each piece and where it goes (like some giant crazy jigsaw puzzle!) and aiming for zero waste. You can usually return excess building materials, especially when they come from a home improvement store.

Can I Save Money Without Doing it Myself?

If you’re a little less handy or just far too busy to contemplate doing your own home remodel, it’s smart to call in a home remodeler. These professionals can advise you in ways to save money with your remodel, based on your end goals and what you’re already working with. Just try to be as flexible as possible, that’s the easiest way to save money with a professional remodel, really.

When you’re ready to get a quote on that remodel, turn to your HomeKeepr community. There are plenty of well-qualified, recommended home pros to choose between. Your Realtor thinks they’re pretty awesome, so you don’t have to worry what kind of results you’ll get. It’ll be great!

Household Net Worth Reaches Record High

DAILY REAL ESTATE NEWS | FRIDAY, MARCH 09, 2018

Americans are feeling richer. Household net worth neared $100 trillion in the final quarter of last year, falling into record territory, according to new data released by the Federal Reserve on Thursday. Rising stock markets and property prices were attributed to the jolt in the fourth quarter. (Household net worth is the value of all of a consumer’s assets, like stocks and real estate, minus any liabilities like mortgage and credit card debt.)

Household net worth increased more than $2 trillion last quarter to a record $98.7 trillion in the final three months of last year, according to the report. Households in the U.S. saw their net worth increase to nearly seven times their disposable personal income in 2017.

The impact real estate has had on that increase can’t be understated, economists say. The value of households’ real estate rose $511.2 billion, which reflects recent run-ups in home prices.

But the rate at which consumers are saving is concerning, JPMorgan Chase Economist Michael Feroli told The Wall Street Journal. The saving rate was 3.74 percent in 2017, down from 7.19 percent in 2015.

Source: “U.S. Household Net Worth Pushes Further Into Record Territory,” The Wall Street Journal (March 8, 2018) [Log-in required.] and “Stock Market Lifts U.S. Household Wealth to $98.7 Trillion,” The Associated Press/USA Today (March 8, 2018)

Good Timing for a Spike in Foreclosures?

DAILY REAL ESTATE NEWS | THURSDAY, MARCH 08, 2018

Foreclosures are surging in some locales, and some housing experts view that as a good thing for the housing market this spring. Foreclosures tend to be priced lower, and many markets are starved for inventory in the lower end of the market.

Bank repossessions across the U.S. may have plunged to an 11-year low in 2017, but that hasn’t been the case in every market. New Jersey saw the opposite, with bank repossession hitting an 11-year high in 2017.

New Jersey leads the nation in overall foreclosure activity. About 1.61 percent of the state’s homes were in foreclosure last year, according to ATTOM Data Solutions, a real estate data firm.

The surge in foreclosures is drawing investors who are looking to buy homes and convert them to rentals.

Christian Schlueter, president of the New Jersey REALTORS®, told The Wall Street Journal that a recent waterfront, bank-owned home attracted eight offers in three days and was under contract for more than the asking price.

“There’s a lot of experienced investors who are buying [bank-owned homes] and some new people are buying them believing they are going to be investors,” he says.

New Jersey, New York, and other states that follow a “judicial foreclosure” system, in which foreclosures wind their way through the court system, often face lengthier times to process and backlogs of foreclosures. Other states that have a nonjudicial system, like Michigan and Texas, have been able to work through their backlog of foreclosures much quicker.

According to ATTOM Data Solutions, the states with the highest foreclosure rates in 2017 were New Jersey, Delaware, Maryland, Illinois, and Connecticut. 

Source: “Why New Jersey’s Soaring Foreclosures Are Good for the Housing Market,” The Wall Street Journal (March 3, 2018) [Log-in required.]

Home Flipping Flies to 11-Year High

DAILY REAL ESTATE NEWS | THURSDAY, MARCH 08, 2018

Higher home prices don’t seem to be spooking investors from buying up properties to flip. About 207,088 U.S. single-family homes and condos were flipped in 2017, the highest level since 2006, ATTOM Data Solutions reports in its U.S. Home Flipping Report. That compromises nearly 6 percent of all single-family home and condo sales during last year. ATTOM Data Solutions defines a “home flip” as a transaction for a single-family home or condo that occurred within the year of a previous sale of the same property.

“The surge in home flipping in the last three years is built on a more fundamentally sound foundation than the flipping frenzy that we witnessed a little more than a decade ago,” says Daren Blomquist, senior vice president at ATTOM Data Solutions. “Flippers are behaving more rationally, as evidenced by average gross flipping returns of 50 percent over the last three years compared to average gross flipping returns of just 31 percent between 2004 and 2006—the last time we saw more than 200,000 home flips in consecutive years.”

Further, financing for home flippers has become more readily available in recent years, Blomquist notes, but 65 percent of flippers still used cash to buy homes flipped in 2017. That is nearly the reverse of 2004 to 2006, when 63 percent of flippers were leveraging financing to buy, he notes.

ATTOM Data Solutions’ report shows that completed home flips in 2017 yielded an average gross profit of $68,143. (That represents the difference between the median purchase price and median flipped sales price.)

Of 52 metros analyzed with populations of at least 1 million, ATTOM Data Solutions researchers found that the highest home flipping rates in 2017 were in:

1. Memphis, Tenn.: 12.8%
2. Las Vegas: 9.1%
3. Tampa-St. Petersburg, Fla.: 9%
4. Birmingham, Ala.: 8.6%
5. Phoenix: 8.5%

Other major markets rounding out the top 10 for highest home flipping rates in 2017 were Baltimore; Virginia Beach, Va.; St. Louis; Miami; and Orlando, Fla.

The metro areas seeing the biggest growth in home flipping in 2017 were Buffalo, N.Y. (up 34%); New York-Northern New Jersey (up 29%); Dallas-Fort Worth (up 23%); Louisville, Ky. (up 22%); and Birmingham, Ala. (up 17 percent), according to the report.

Housing Markets Need Landlords to Sell

DAILY REAL ESTATE NEWS | TUESDAY, MARCH 06, 2018

Landlords own thousands of single-family homes across the U.S. With housing shortages abounding, some are calling on landlords to start selling. A slowdown in rent growth may convince more to finally unload their inventories.

“As new multifamily supply catches up with demand and slows rents, some large investors may begin putting their holdings of affordable single-family homes up for sale, which would be great news, particularly for first-time buyers,” says Lawrence Yun, chief economist of the National Association of REALTORS®.

Last week, NAR reported that contracts to buy previously owned homes dropped to their lowest level in more than three years in January. They cited low inventories of homes for sale to blame. 

A jump in apartment construction has slowed rent growth for many multifamily buildings across the country, but single-family landlords are still mostly reaping profits. Invitation Homes Inc., the nation’s largest single-family landlord, owns more than 80,000 properties. It is forecasting its revenue growth to be about 4 percent to 5 percent in 2018, which far outpaces rent-growth projections for apartments, according to Green Street Advisors LLC, a research firm.

“Single-family rental top-line growth should continue to fare much better than that of apartments due to steady demand and limited impact from competitive new supply,” Green Street Advisors note in a recent report.

Source: “In Supply-Starved Home Market, Can Wall Street Landlords Help?” Bloomberg (February 28, 2018)

Home Features First-Time Buyers Choose

DAILY REAL ESTATE NEWS | TUESDAY, MARCH 06, 2018

A living room is considered essential for first-time home buyers, according to a poll of home shoppers conducted by the National Association of Home Builders. Sixty-one percent called the living room a must-have in the home they plan to buy. A laundry room and dining room also ranked high on the must-have list for first-time buyers.

The following are home features that first-time buyers call essential, ranked in order of what they deemed as most important:

1. Living room
2. Laundry room
3. Dining room
4. Garage storage
5. Walk-in closet in master bedroom
6. Shower stall/tub in master bath
7. Front porch
8. Great room
9. 2-car garage
10. Kitchen double sink

Source: “Home Features Buyers Consider Essential,” National Association of Home Builders’ Eye on Housing blog (March 5, 2018)

Are You Really Ready to Buy? Factors Beyond Financial

When that rent check leaves your hand every month (or, more likely, you click the button on the website), you feel a little lighter in the wallet and a bit more empty inside. Every month, that money goes into your landlord’s pocket, pays down their principal, helps them increase their net worth and you get what? A roof over your head that hasn’t been updated since the Reagan administration and neighbors that seem to not realize that while their band is lovely, 2 am is not the time to crank it up to 11.

No, you’ve had it! It’s time to move.

It’s time to buy your own house. You’re ready to have some control over your own living situation. Aren’t you?

Spend Some Time Soul-Searching Before You Pre-Qualify

There are far too many articles out there that discuss homebuying readiness in terms of dollars and cents, neglecting all the other things that are involved in a truly successful homeownership experience. So, we’re going to assume you’re able to qualify for a loan and just skip that part. You’ve read enough of that by now, that’s old news.

Anyone who tells you that buying and owning a house isn’t a deeply emotional experience is someone who has never done it. People become strangely attached to their homes, they experience deep heartbreak when a contract falls through at the last minute, they feel almost rapturous when they finally sign on the dotted line. The first problem their home develops gives them a sick feeling in their gut. There’s a huge emotional and social component to homeownership, but no one ever talks about it.

What even drives us to buy? Two main things: an urge to increase our social standing and a hope to give ourselves some kind of financial security. Theoretically, right? At the end of the day, that’s what it amounts to. In some economies one or both of those may be on pretty shakey ground, but they’re always beneath it all. Before you get there, let’s do a reality check.

Reality Check: Are You Really Ready?

You’re qualified, you’re flush with cash, but you may or may not be really ready to buy a home. After all, these are untested waters for you. It’s not as if no one has gone this way before, plenty have and even lived to tell the tale. But for you to really get off on a good foot, you should dig deep and make sure you have these items in check:

Wanderlust. Think of buying a house a little like getting a tattoo. It’s not a thing that’s easily undone. Even if you just walk away, you have a foreclosure hanging over your head for years and years, your credit’s damaged, you could even owe some balance from the sale of that house (depending on the local laws). If you have wanderlust left in you, get it out now. Go live in Nepal while you can, because once you buy, you’re going to have to live in it for a while. That’s not to say you can’t visit Nepal, but you can’t stay around for months on end once you have a mortgage that has to be paid.

Emotional Maturity. Living in a neighborhood with people you can’t easily move away from also requires a bit of emotional maturity. The guy across the street may drive you nuts because he loves bright, annoying Christmas lights. Don’t punch him in the face, just hang some blinds. In addition, learn to tame your inner worrier. All houses have problems, every single one, even the brand new ones. So when you notice that the air conditioner’s condensation line is backed up, take a deep breath and get to flushing it or call in a pro. In short, don’t panic, there’s a solution to everything.

Career Security. All jokes aside, it’s really very important that your career is fairly secure before you jump into a mortgage that’s 30 years long. If you hate what you do or you’re not really sure you want to do it over the long term, you may not want to commit to a mortgage just yet. Maybe wait until you get that first year under your belt and see if what you learned in class is anything like what the field really is in practice. If you would need to return to school or move out of state to find a new opportunity, it could be very difficult while trying to maintain a mortgage.

Relationship Security. The thing no one wants to say to you is the thing this blog is going to say right now. Is your relationship really sure enough to be buying a house with that person? No, really. This is on the level of having a child with someone, it’s a huge financial commitment and one that could obliterate you for years and years if things soured quickly. Whether you’re married or not, make sure this person is one you can count on for the rest of the term of that loan, as romantic as that notion may be. You’re in this mortgage together, make sure it’s an equal partnership.

These are really important parts of your life to examine before you decide to buy a house. It also helps to be a good saver and a little handy (or at least brave enough to try to fix the small stuff). Not every problem will be one your can handle on your own, but you should at least be able to stabilize your issue so it doesn’t get worse before you call the experts in!

Speaking of the Experts…

When that roof starts to leak or the faucet develops a drip, there’s no place like HomeKeepr. Just tap your smartphone or login from the web to meet the perfect home pro for your particular home problem. Since they’re all recommended by your Realtor, you know they’re gonna be great!

CoreLogic: Housing market nearly recovered from recession

CoreLogic: Housing market nearly recovered from recession: CoreLogic released a report outlining the real estate economy from 2006 to 2017, showing that the housing market has nearly completely recovered from the recent recession. During the recession, home prices fell 33% nationwide, hitting their lowest in March 2011. Since then, home prices have risen once again by 51%. But some states are still struggling to return to their pre-recession price levels.

Styling Tips to ‘Wow’ Spring-Time Home Buyers

Styling Tips to ‘Wow’ Spring-Time Home Buyers

Bracing for Impact: How Insurance Can Protect Your Home

Whether you’re buying a house or even thinking about it, you’re probably hearing a lot about insurance and how you need it. But there are so many kinds and you’re not really even sure which ones do what and if you actually need them all.

Car insurance was a breeze, there’s only the one kind — it’s either going to fix the car you run into or that car and yours, too (basically), but with home-related insurance, there are a lot of strange specialties, and other things that aren’t quite insurance, but act like insurance.

How will you know which you really need to protect your home and which are just a waste of your hard-earned cash? Let us walk you through it.

Insurance for Your House and Your Stuff: Homeowner’s Policies 101

If you rented a house before you bought, you may have had a watered-down version of this policy, often called a renter’s policy. These are meant to cover your things, should the house burn down or a tornado carry it off into the sunset. Renter’s policies are relatively inexpensive, running about $15 a month in most areas, so more landlords are making them mandatory parts of rental agreements. You’ll see a few similarities between your renter’s policies of the past and a homeowner’s policy.

A homeowner’s policy is designed to protect you, your family, your dwelling and your personal property from damage, both physical and financial, to some extent. Most policies are essentially the same, containing these components:

Dwelling coverage. Your lender will require that if your property is severely damaged, it’s able to recover the amount of the loan you’ve borrowed. This is what dwelling coverage is for, when it comes down to it. In the case that your house were a total loss, you’d have the option to either rebuild with those insurance funds or give them to the bank and own the lot free and clear (then you could rebuild with cash or sell the lot off).

Oh, but it gets better! Dwelling coverage will also cover major damage to your home, like when a bad wind or hail storm comes through and causes your roof to spring a leak. You will likely have a deductible around $1,000 or higher to deter you from making too many claims, but it is handy to have when big issues crop up.

It’s extremely important to note that while many acts of nature (tornadoes, fires, wind storms, etc.) are covered by your dwelling coverage, most policies specifically exclude floods, earthquakes and sinkholes. Check your policy carefully and ask your agent about additional coverage if you’re in a flood-, quake- or sinkhole-prone area.

Other structure coverage. Other structure coverage does exactly what it says it does: covers other structures. There’s usually a dollar cap, which is a percentage of the value of your home, but it can be applied to major damage to sheds, detached garages, fences, greenhouses and any other permanent structure you have on your property.

Personal property coverage. This is the part of the insurance policy that’s just exactly like renter’s insurance. If your property is damaged during a storm, stolen during a robbery or severely damaged by something out of your control, you can file a claim and possibly have some kind of reimbursement. Replacement cost coverage provides the amount necessary to replace your items, so if this is an option, choose it. Again, though, there is probably not coverage for flooding, earthquakes or sinkholes, so be ready to ask about it.

Personal liability coverage. If the neighbor pops by to bring you a pie and accidentally slips and is injured, you don’t have to worry about how much her hospital bills are going to be. Your insurance will cover it (to a specified amount). The same applies if your tree drops a limb on the neighbor’s roof and they sue you for the costs. Accidents happen, that’s what insurance is for.

Other things that are covered by this part of the policy may include dog bites that occur on your property, if you were honest with the agent and your dog wasn’t on a prohibited dog list (some insurance companies won’t insure homes with “pitbull” type dogs, German shepherd, rottweilers, and others). It’s essentially a general liability policy tied to your home, so if you can imagine an accident stemming from your family, it’ll probably cover it.

Loss of use coverage. Many homeowner policies will also pay for you to live elsewhere while your home is being repaired after major damage. This is the loss of use coverage portion of the policy. It, of course, comes with a cap, so don’t get too cozy at the Ritz. Your dollars — and days — are limited.

Additional Coverage. You can choose from a number of additional coverages, from extra coverage for valuable collectables to coverage for identity fraud, at an additional cost. Most of these extra coverages won’t apply to most buyers, but there’s one that you may want to consider if you’re buying a house with a basement or in an area with a high water table.

That’s the “Water Backup and Sump Pump Discharge or Overflow” coverage. Now, this still won’t cover flooding, but it will cover any water that’s forced back into your house through the sewer system due to excessive ground- or wastewater causing backflow in the sewage system. So, it’s not for flood waters that enter your house the normal way, but if they come in through the sump pump, you’re gold.

If you’re in an area where this is a possibility and the coverage isn’t much extra, definitely get this. The sheer nightmare that is water backup from a basement drain due to oversaturation is unspeakable and the smell unforgettable. You’re going to be happy to leave that one to the pros.

Flood Insurance: What’s That All About?

Flood insurance primarily comes up when you’re looking to buy a house sitting on a piece of land that has even a tiny corner poking into a floodplain. The fact that most homeowners don’t know they can buy flood insurance no matter where they live is a serious disservice to all of them, especially considering how many homes have been flooded in recent years without being located in flood plains. The issue usually comes up when your bank requires a flood insurance certification to process your home loan for a house in a flood plain, otherwise, figuring flood insurance out is in your court — and most people would rather skip the additional $600ish dollars a year.

That’s right. For $50 a month, your $250k home can be insured against flood damage. Or thereabouts, the price varies with your risk. Some homes are less, some are a bit more. This is the coverage that fills in the flood gap that your homeowner’s leaves totally open. It only pays on flood damage, and there are plenty of exclusions, including anything located in a basement or other room that’s below the level of the ground, but it’s a lot better than the nothing you’ll have otherwise. Ask your agent about optional flood insurance while you’re discussing homeowner’s.

The Seller Provided a Home Warranty, How Does This Figure In?

Getting a home warranty at closing is a good move. Although the companies behind them can sometimes be slow to get the wheels moving, they can protect you from major repair expenses in your early homeownership years. But, they can also be a little confusing because they sort of work like insurance, even though they aren’t technically insurance.

Home warranties help you cover the cost of repairs for common small household issues, like leaky plumbing, air conditioning hiccups and electrical shenanigans. You pay a portion of the cost of the service call, depending on what level of plan was purchased, and the warranty company pays the rest.

In this way, it behaves a bit like health insurance. Everyone pays into one big pot and the money is used where it’s needed. Not everyone will need to use their home warranty, but those people who do need it may require a considerably larger chunk than they contribute. Everybody understands that’s the deal when they sign up, though. They know they may not actually use the coverage, so it’s all on the up-and-up.

Wrap Your Home in a Warm Layer of Insurance Bubble Wrap

A lot of home buyers and homeowners think that insurance is a waste of money. After all, it’s designed so that you never use it. While that may be true, the fact remains that if you do need it, you’re really going to need it and there’s no take-backs. You can’t change your mind and load up on coverage after that giant tree has fallen through your bathroom ceiling.

For the relatively small cost (when compared to your house payment) of the right insurance coverages, it’s nice to be able to sleep at night without having to worry about what you’ll do if water comes in under the front door from the storm that’s brewing. Getting good insurance is a snap, too.

You can ask your Realtor to recommend an agent that they like through the HomeKeepr community — that agent’s contact information will then appear instantly. A short call later, you’ll walk a little taller and feel a little bit better about the next windy day.