Over the past several years first-time home buyers may have shied away from entering the housing market due to stagnant wages and debt, but times have changed.
According to TD Bank’s First-Time Home Buyer Pulse, one in five consumers is actively looking to buy his or her first home, and 46% of millennials will be looking in the next one to two years.
If you’re a first-time buyer, the mere thought of securing a mortgage may be overwhelming. For most people, a home is the largest purchase they’ll make, and very few can take on this purchase without a loan. Here are some helpful tips and best practices for first-time buyers:
Save for the down paymentMost mortgage lenders require a cash down payment of 5%, 10%, or 20% of the sale price. Buyers today may find it difficult to save for a large down payment, especially young adults saddled with substantial student loan debt. Traditionally, buyers who were unable to put 20% down had to pay an additional $100 to $200 per month to their mortgage lender for private mortgage insurance (PMI).
The great news is, today many lenders are offering home affordability and down payment assistance programs. TD Bank offers the Right Step mortgage, which allows borrowers to put as little as 3% down without the added cost of PMI.
Factor in home improvement costs and monthly household expensesWith today’s low inventory of affordable homes for first-time buyers, many buyers will find themselves settling on a home that requires renovations or upgrades. These costs should be factored in at the start of the financing process so buyers are comfortable with their down payment and monthly payment and will have money available to make improvements. For buyers who have not lived on their own or for those who previously rented, the added costs of running a household can be a shock. Monthly costs for utilities, homeowner’s association fees, cable, and Internet, can add up quickly. Factoring these expenses in at the beginning of the mortgage financing process can help borrowers better assess their overall budget and a realistic monthly mortgage payment.
Shop around for a mortgageWe know that the best mortgage experience for buyers occurs when they have open and ongoing communication with their lender. Finding a lender and discussing financial needs and budget should be the very first step a buyer takes in the home-buying process—even before finding a Realtor. The First-Time Home Buyer Pulse revealed that saving for a down payment is a barrier to homeownership for many first-time buyers. That’s why it’s important to find a lender that helps buyers understand what they can afford and share what financing options are available. Today, mortgages are not one size fits all—to find the option that best fits their needs, buyers should discuss their financial situation with a lender they trust.
Get educatedPerhaps the single most important aspect of purchasing a home is to fully understand the mortgage and the overall home-financing process. Take advantage of educational courses offered by local financial institutions and government programs. In fact, TD Bank offers a First Time Home Buyer Seminar series that addresses all aspects of a home loan—starting with helping buyers decide if they’re truly ready to own a home. Following that, the seminars share information on the criteria lenders use to evaluate a borrower, the documentation buyers will need to provide, what each portion of a mortgage payment goes toward, and the mortgage team that processes and approves the loan. These seminars are useful tools and provide valuable background for borrowers who are daunted or overwhelmed by the process.
While buying a home may feel overwhelming for first-time buyers, finding a lender you can trust will guide you in the right direction and help you prepare for the mortgage process.
By Janna Herron, Bankrate.com
The crash in housing prices that walloped the economy over the past decade no longer seems to haunt Americans as it did during the recession. For the first time in three years, real estate was the most popular investment option in a survey that accompanied Bankrate's Financial Security Index.
When asked what kind of investments made the most sense, 27 percent said they'd invest in property if they had a pool of spare cash. CDs and other cash investments, the top answer in Bankrate's 2013 and 2014 surveys, came in second at 23 percent.
The great thing about real estate is that even in a bad economy, it will usually fare better than stocks. Land, after all, is a finite resource. People need a place to live, work, shop and play -- so real estate is really just a matter of supply and demand.
What's more, real estate will continue to appreciate despite occasional slow-downs in the economy. In fact, it's proven to be the best way to create wealth, and an investor need not be a genius or a millionaire to succeed. Here are some tips, then, for entrepreneurs on getting started and succeeding in real estate investing:
1. Do -- plan your financial goals.Before you buy that first property, or do your first analysis, determine what you expect from your investments. What are your financial goals? We often discuss the “time vs. money” concept: The more you have of one, the less you need of the other to reach your financial goals. This means that you shouldn’t shy away from taking the time to understand your goals and make sure each investment is a step toward achieving them. If you are unsure exactly how to create financial goals, meeting with a financial advisor is an excellent first step.
2. Don't -- spend a fortune on books, tapes and seminars, then just put all that information on a shelf. You absolutely do need to learn some basics before venturing into investing. So, be sure to do some studying, but don’t let “buying and collecting” information become your endgame. Again, having goals in mind will make the process much more straightforward. It’s easy to get so tied up in the “research” phase that you never actually take action. Instead, write down specific questions you want answered or goals you want to meet before delving into the latest book/seminar/etc.
Related: How to Live Rent-Free While Building Your Business
3. Do -- look at plenty of properties. Don’t just grab the first property you look at. Too many investors buy properties because they “look nice,” or the investors don’t want to put the work in to look at what’s really out there. Remember, you won’t be living there, so don’t make your investment decision based on your personal preferences. While you shouldn’t fall into the trap of analysis paralysis, make sure you are thorough in looking through properties. Give yourself a wide range of options, then narrow them down based on the criteria (goals) you have set for yourself.
4. Don't -- postpone starting your investment program because you’re waiting for that perfect “unicorn” deal.That’s the flip side to number 3, of course. Plenty of beginning investors suffer from “a-better-deal-may-be-just-around-the-corner” syndrome. This can backfire in a big way, and you could potentially let a great deal slip just because you’re holding out for something better. Your task may feel difficult if this is your first property, but you must realize that the “perfect deal” rarely (if ever) exists. Better to execute on a deal that meets most of your criteria than wait for another that may never come.
5. Do -- a thorough financial analysis.Be realistic. Look at different alternatives to determine which makes the most financial sense. And never buy property at a higher price or on less attractive terms than your analysis says made sense. Be wary of sellers that try to over-estimate the value of the property through pro-forma (estimated) data. While you can certainly use a pro-forma to start the conversation, make sure you know the real numbers before closing. Look at previous years’ tax returns, property-tax bills, maintenance records, etc. to get a good idea of the real income and expenses.
The most important figures you should know are:
Once you have understood these figures, you should have enough information to determine whether or not acquiring the property fits with your financial goals.
6. Don't -- try to buy property that the seller is not motivated to sell.If the seller is motivated to sell, you’re not likely to get the price best aligned with your financial goals. So, how do you know if a seller is motivated? Look at the asking price. For example, If the property has been on the market for a year for, say, $200,000, with little-to-no price reduction, the seller is clearly not very motivated to move the property. However, if that same property has been on the market for a year and has had its price moved down considerably, the seller most likely wants to do whatever it takes to get the property off his or her hands. Of course, this raises the question of how to find motivated sellers. There are many approaches, and not all of these will work for you, depending on what property you want. But a few trusted methods include:
7. Do -- know the difference between real estate investing and the business of real estate.As an entrepreneur, you already have a business, and real estate investing is best used to support that business, not replace it -- unless that’s your intention. In other words, don’t get so caught up in executing transactions that your core business falters. If that happens, you’ll be facing a bumpy road to get back to stability. Unless your business is itself real estate, or you’re looking to get into the business full-time, always remember that pursuing these deals is a means to an end, not an end unto itself.
So, if you’re interested in staying ahead of taxes and inflation while building security for the future, real estate investing may be for you. What are you waiting for?
Savvy home sellers are aware that they need to present their home in it’s absolutely best condition to get the top dollar, in any real estate market, no just a buyer’s market. The question of which improvements to tackle first is asked very often.
Kitchens and Baths. That’s what we answer because they are what often sells a home. A typical buyer will go for the home with an updated kitchen and updated bathrooms, because those rooms are more expensive to renovate.
But, when making improvements, a home owner can go overboard. There are improvements that cost a lot of money but won’t necessarily increase your home’s value. Here are 3 things to avoid:
1. Avoid Expensive Landscaping
2. Avoid expensive floor coverings.
3. Avoid Over-Converting Rooms
1. Don’t take it personallyWe know you love the way you set up your living room. That eclectic collection of wicker baskets from all your European travels stacked up in the corner? It’s the perfect detail for you—but not for your stager. Not even close.
So here’s the thing: When they tell you what to change (and they absolutely will), don’t be offended. It doesn’t mean they think your style is awful. Not necessarily, anyway.
“It’s not about whether I like something or not,” Burke says. “It’s about how we’re going to present it. I know what photographs well and what looks dated.”
Her favorite clients are the ones who know tough feedback is coming and don’t care: “I walk in and they say, ‘You can’t hurt my feelings. Do whatever you want.’”
2. Toss your stuff, and disconnect emotionallyFor many sellers, home staging will be the first time they realize they’re really, actuallymoving. Family pictures come down, the sofa goes into storage, and suddenly this place you called yours is looking less and less like you.
If you need to do some emotional processing, we understand: It’s hard to put your family home on the market. But don’t subject your stager to your stress. Detach. Chill out. Help the process, don’t hinder or fight it. Keep your eye on the prize: selling your home at the right price, to the right buyers, within the right time frame.
What does that really mean? Try removing as much of your stuff as possible before the stager comes. By tackling spring cleaning you’ll not only accomplish some necessary decluttering before your move, but you’ll also get used to the idea that this is no longer your home.
“We need to make sure that they’re truly ready to sell their house,” says David Peterson of Synergy Staging based in Portland, OR. “That’s a big part of emotionally disconnecting.”
3. Move out (if you can)Both Peterson and Burke find staging a home vastly easier when it’s vacant. If you can afford to move out when the home goes on the market, do it.
“It’s easier for them, it’s easier on their pets, and it’s easier on the buyer,” Burke says. “We can create one cohesive look and don’t have to blend anything.”
Occupied houses present more of a challenge (and take substantially more time): Stagers have to accommodate daily living, as well as risk the homeowner not preserving their layout (or any rented furniture).
Occupied homes can even cost more to stage. “It’s just a lot more work, timewise, when the owners are still living in the place,” Burke says.
4. Stay out of the picture(s)According to the 2014 Profile of Home Buyers and Sellers, 92% of buyers use the Internet to look for homes—meaning the pictures posted alongside your home’s listing are wildly important.
“Much of what I’m doing is to appeal to people through photographs,” Burke says. “I hope that photo will touch people and they’ll say, ‘That’s going on my short list.’”
Peterson aims to be the “last person in before the photographers. We want those pictures to look great.”
But no one wants the buyers to be disappointed with the home’s real-life presentation after seeing photos online. So here’s a bonus: If you’re staying in the property, make sure to keep it in tiptop shape.
5. Get your money’s worthStaging isn’t a last-minute addition before your home officially goes on the market. Stagers work far in advance and can’t always fit in last-minute work. Costs start around $1,250, depending on your state of residence, square footage, and what—if any—furniture you rent, according to the Real Estate Staging Association.
That might seem like a lot of money to spend on a home you’re about to sell, but both Burke and Peterson say staging is an investment with a very high return. “Anything we put in, we want to make sure you’re getting your money back,” Burke says.
6. Stay on scheduleDon’t dillydally on making the recommended changes for your stager, who can’t begin rearranging until you’ve finished renovating. Usually the requested changes are small (new paint, fixing chipped tiles in the bathroom, etc.).
Not finishing small jobs on time can push the entire project back.
“If we get there and a place hasn’t been cleaned, or there’s still a painting crew, we can’t do our jobs. Then we have to charge them a fee, leave, and then reschedule,” Peterson says. “If we’re booked out several weeks, it really makes it hard.” And maybe even more expensive. So get moving.
From: Realtor.com by Jamie Wiebe
Hardscape design generally refers to the hard surfaces in the yard like pathways, walkways, and patios. Usually these features are made from stone or concrete but can also be made from rocks, wood or other hard materials. Let’s look at some beautiful pathway, walkway and patio designs from these Porch professionals. Poured concrete Poured concrete is a common material for sidewalks and front entries. It’s a material that blends well with traditional sidewalks and driveways and is easy to create during the home building process. Taking care of poured concrete is relatively easy as its smooth surface is easy to shovel, sweep or pressure wash. Usually sections are poured in sections with a narrow spacer in between the sections; sometimes this space is filled with a piece of treated lumber. Aggregate concrete, which is concrete with larger stones, is another common style. Pouring the concrete in sections makes is less vulnerable to cracking or moving. Unfortunately, underground roots can force the concrete up and create cracks. It’s a good idea to maintain or fix these pieces of lifted concrete so they don’t become a tripping hazard.
Stamped concrete is an economical way to get the look of individual stones while using an inexpensive material: concrete. To create this look, concrete is poured then, while it’s still wet, stamped with a tool in the shape of uneven stones. Because the spaces in between the “stone” is not very deep, it makes it easy to sweep or shovel and keep clean. It’s also easy to pressure wash stamped concrete as you don’t have to worry about sand or gravel in between pavers.
Stone tile pavers
Stone pavers are a traditional way to create hardscape areas. Most paving stones are made from concrete or concrete aggregate and is offered in a wide range of sizes, shapes and colors to suit any style of home. To create an even surface, the ground is first leveled then prepped with a layer of crushed rock or sand. It takes a lot of patience and skill to create an even patio or walkway using pavers and very often the material needs to be cut to fit the design. Instead of grout, sand is usually spread over the surface then swept into the tiny space in between the pavers. Because of the complexity and skill level, most homeowners choose to hire a professional to create a stone paver walkway or patio. Some designs call for a larger space in between the pavers in which moss or grass is allowed to grow, like this one.
CobblestoneCobblestone is essentially a style of paving stone but has a distinctly rustic look and feel. Cobblestone is usually made up of granite with slightly uneven or rounded edges that don’t form right angles when placed together. The effect is an older, worn look that many homeowners appreciate as well as an extremely durable and strong surface. Because of their small size, there is a bit more flexibility in the designs and patterns produced with cobblestone. Because of the nature of this material, a well-made cobblestone driveway or patio could last for over 100 years.
Some yards look great with a combination of several different materials; the effect creates a dynamic design with variances in color, pattern and texture. This home (shown below) features poured concrete aggregate with a combination of red brick and river rock in between the large pavers. A crushed rock pathway leads you to another area of the yard while a moss-covered rockery staircase leads to the upper part of the yard. Although having a variety of surfaces might pose a challenge when it comes to cleaning and maintenance, it can help create a unique feature in the yard.
Crushed gravel or rock Hardscape
can be made from a variety of loose rocks or pebbles. In this home (shown below), we see that loose rock is combined with poured concrete and aggregate slabs to create a varied design. Moss growing in between the aggregate creates its own design and softens the edges. Head to any gravel supply store and you’ll see that the prices and styles of crushed rock are varied; you’ll want to have a good idea of your square footage needed to accurately budget for this project. Loose gravel can shift, and may be more difficult to remove debris, so consider the location and use during your planning stage.
like treated lumber or synthetic wood, is often used outside for walkways, patios or decks. Since wood can’t be placed directly on top of the soil, a wood plank walkway is most commonly built just above the ground, like a very short deck. Wood should always be treated to withstand the outdoor elements. Wood usually requires more maintenance compared to stone or rock and will need to be replaced over time. Because wood is built just above the ground, many homeowners hire a professional to construct the platform and ensure it is built up to code.
From: porch.com by Anne Reagan
L+M Development Partners, along with a slew of other partners and investors, are currently converting the four-story, 400,000 square-foot Hahne & Co. building, located at 609 Broad Street, in downtown Newark, into a mixed-use structure. 160 residential units are being sculpted out of the upper levels, and 75,000 square feet of retail will occupy the ground floor, which includes a 30,000 square-foot Whole Foods.
Here’s the problem. You have a home for sale and Zillow’s Zestimate for the house is way too low. To make matters worse, Zillow puts their (low) estimate of your home’s value right below your list price so everyone that looks at your house on Zillow thinks it’s way overpriced.
Tress Realty Group compiles some of the best real estate news, tips, and information for buyers, sellers and investors.