Make Home Repairs Before Selling

Quick fixes before selling a home always pay off, but which repairs bring the biggest return? Specific answers to this often-asked question largely depend on a variety of factors such as:

• Time of year
• Location of the home
• Market temperature
• Competing inventory

There is no hard and fast rule. But there are general guidelines that apply to most homes. For example, the National Association of Realtors publishes each year the "cost vs value" report with Remodeling Magazine, which features various home project costs and returns in four regions, including a national average.
 
Flooring Fixes
Wood floors are a hot item today, but preferences over the years have changed. Carpeting became popular -- like with lots of consumer products -- after somebody figured out how to get the government to pay for it. When vets returned home from WWII, housing was at a shortage. Homes were sold with newly installed carpeting because the cost for the carpeting could be rolled into government-insured (VA) loans.
Then carpeting became vogue in the 1960s. Some homes today, sadly, still sport '60's shag carpeting. The final movement away from hardwood happened when installing hardwood floors became too expensive. Plywood was easier to obtain and faster to install. Plus choices in carpeting were plenty. It's still relatively inexpensive to install carpeting.

• Hardwood Floors
  If your home has hardwood floors, that's what buyers want, and it would pay to have the carpeting removed and the floors refinished.
• Carpeting
  If your sub-floor is plywood, then replace the carpeting with light tan. Neutral carpeting is your best bet for resale.
• Ceramic
  Replace chipped or cracked tiles. Clean or replace the grout. But don't install ceramic (it's too expensive) unless it's for aesthetic reasons in an entry way.

Paint Ceilings & Walls
Buyers spend more time than you would think staring at ceilings. They are looking for signs of a leaky roof, but what you don't want them to see are stains from grease or smoke and ceiling cracks. Ditto for walls. Nothing says freshness like new paint, and it's the most cost effective improvement. Use fiberglass tape on large cracks, cover with joint compound and sand. Paint a neutral color such as light tan - think of coffee with cream.


Wallpaper
It's not that all buyers hate wallpaper. They hate your wallpaper - because it's your personal choice, not theirs. And they hate all dated wallpaper. Get rid of it. The easiest way is to steam it off by using an inexpensive wallpaper remover steamer.


Wood paneling
Even if your wood paneling is not real wood but composite, you can paint it. Dated paneling must go. Older wood paneling such as walnut, mahogany, cedar and pine, it's all gone out of style. Paint it a neutral and soft color after priming it.

• Textured ceilings
  Older popcorn ceilings with the "sparkles" often contain asbestos and if disturbed are health hazards. Say goodbye to it. But even recently sprayed ceilings turn off buyers. It's not expensive but it is time consuming to remove. Lay down drop cloths and scrape it off. You will need to repaint.

Kitchen Improvements
Appliances and cabinets are typically the most expensive items to replace in a kitchen. If you don't have to replace them, you'll save a ton of money. However, if your cabinets are dated and beat-up, your house might not sell if the cabinets aren't replaced.
Kitchen remodels return nearly 100%. According to Remodeling Magazine, the high-end kitchens don't return as much as the mid-range or minor kitchen remodels. Most buyers won't pay extra for a built-in Sub Zero refrigerator, professional 8-burner stove, undermount sink or travertine floors. If you live in the Midwest, your return will be less than for those who live in other parts of the country.

• Cabinets
  Resurfacing is your best option. This involves attaching a thin veneer to the surface of the cabinets and replacing the doors and hardware. If your cabinets are painted, add a fresh coat of paint and new hardware.
• Counter tops, sinks & faucets
  Granite counters are not necessary. Simple laminates, newer faucets and sparkling sinks sell. Buyers don't want leaky faucets or stained sinks.

Bathrooms
The national average of recouped cost is more than 100% for bathrooms. New floors, fixtures and lights payoff.
 
Roofs & Exterior
If your home needs a new roof, bite the bullet and do it. Even though most roofing tear-off jobs take one to two days, buyers shy away from buying a home if the roof needs to be replaced.

• Patch cement cracks in sidewalks
• Resurface asphalt driveways
• Plant flowers
• Caulk windows and doors
• Replace doorknobs and locks
• Fix or paint fences

Conclusion
Overall, buyers want to buy a home that has no deferred maintenance, newer appliances, updated plumbing, electrical and heating (including a/c), modern conveniences and is ready to occupy. When you need to sell your home please contact the Spouses Selling Houses team. Until next time!! Ebbie :)

Dept of Justice details foreclosure settlement with banks

In the largest deal to date aimed at addressing the housing meltdown, federal and state officials on Thursday announced a $26 billion foreclosure settlement with five of the largest home lenders.
The deal settles potential state charges about allegations of improper foreclosures based on "robosigning," seizures made without proper paperwork.

Most of the relief will go to those who owe far more than their homes are worth, known as being underwater on the loans. That relief will come over the course of the next three years, with the banks having incentives to provide most of the relief in the next 12 months.

At least $17 billion of the settlement will go to reducing the principal owed by homeowners who are both underwater and behind on their mortgages. Depending on which loans have the amount owed cut, the amount of principal relief could reach as much as $34 billion.
Federal officials say that portion of the settlement will provide relief for up to 1 million of the most beleaguered homeowners. But if that many homeowners get the amount they owe reduced, it would only be an average reduction of $17,000 in their principal.

Given the fact that many homeowners are far more underwater and will need steeper reductions in order to be able to afford their payments, the number of homeowners who receive help under this part of the program will likely fall far short of the 1 million mark.

Officials say up to 750,000 other homeowners who are underwater but are current on their mortgages will be able to refinance their current loans at lower rates. They will not receive a reduction in principal, but with mortgage rates now near record lows, they could receive substantial savings on their monthly payments. The settlement sets aside $3 billion to account for the reduced interest payments the banks will receive after the refinancing.

About $1.5 billion of the settlement will to go homeowners who had their homes foreclosed upon, which will come to about $2,000 per homeowner.

The deal is the second biggest settlement involving the states ever reached, trailing only the $206 billion settlement reached in 1998 between state attorneys general and the tobacco industry. And it dwarfs any settlements that major Wall Street firms have reached to settle other allegations of misdeeds related to the financial markets meltdown and the Great Recession.

As of Wednesday night, at least 42 had signed on onto the settlement. which would yield as much as $26 billion available for qualified homeowners. The deal marks the largest housing relief available "underwater" homeowners whose principal exceeds their home's value, as well as those who have been foreclosed on, since the financial crisis began.

Housing Markets Improving

Data released earlier this week indicates that the number of improving housing markets nearly doubled in January, providing the latest evidence of a real estate turnaround.

Seventy-six markets are now on the upswing, according to the Improving Markets Index, a monthly release prepared by the National Association of Home Builders (NAHB) and the First American Financial Corporation. That represents an increase of 35 markets from the December release, which listed 41 markets as improving. The index classifies a market as improving if it posts an increase in jobs, home prices and single-family housing permits for at least six months.

"The substantial gain in the number of improving housing markets in January shows that more consumers are looking favorably at a home purchase in light of today's historically low interest rates and attractive prices," said Kurt Pfotenhauer, vice chairman of First American Title Insurance Company. The average rate of a 30-year-fixed mortgage dropped to match the lowest on record last week, with Freddie Mac putting the number at 3.91 percent.

Most of the cities that joined the list are relatively small metropolitan areas, NAHB chief economist David Crowe notes. But a few major cities, including Dallas, Denver and Philadelphia, also made the cut.

Beyond just the general increase in the number of improving markets, the data is also encouraging because of the wide geographical distribution of the recuperating cities, NAHB Chairman Bob Nielsen said. The generous spread of improving cities suggests that a possible recovery is not concentrated only in certain pockets of the country.

The newly released data is the latest harbinger of good news for the housing market in 2012.  Pending home sale hit a year and a half high in November, while total home sales rose 4.0 percent the same month, according to the National Association of Realtors. Residential construction ticked up 2 percent in November, The Commerce Department said earlier this month.

Despite the positive signs, the foreclosure crisis could continue to be a "lingering problem in 2012, NAHB senior economist Robert Denk told AOL Real Estate.

"Things are not great, but they are coming down," he said. "There's no imminent threat that things are going to get worse on that front."

The National Association of Home Builders, which prepares the index with The First American Financial Corporation, is a trade group that represents more than 160,000 members involved in home building. The First American Financial Corporation provides title insurance and settlements services to the real estate and mortgage industries. If you are in the market for a home at the lake, please let our team work with you. Call the Spouses Selling Houses. Until next time!! Ebbie :)

To Build or Buy an Existing Home?

Upgrading to a new home? You can buy a brand-new home in one of three ways: buying a house already built on spec; having a semicustom home built as part of a development (you can choose from a set palette of finishes and upgrades); or having a purely custom home designed and built to your specifications.
But don't get so caught up in the sparkling new paint and granite countertops that you forget to make a good deal!

Evaluate the pros and cons of a new home

• New homes are typically far from the city center; will you mind the commute?
• Are you willing to coax a new lawn into existence, and can you wait 20 years for sapling trees to mature?
• Will the cookie-cutter nature of new subdivisions drive you bonkers?
• New houses tend to be built right on top of each other. Do you mind the closeness and potential lack of privacy?

Evaluate the new neighborhood

• Check with the developer about potential Homeowner's Association (HOA) fees and rules; some are incredibly expensive -- and strict. They may not allow storage sheds, certain paint colors or finish materials, solar panels or even vegetable gardens. Be sure to find out if the HOA can assess penalties for infractions.
• Ask whether cable and Internet are readily available and from what companies; your new house will be wired for cable but that does not mean the cable company offers service to your neighborhood.
• If the development is still under construction, you'll be dodging giant contractor trucks and facing jackhammering at 7 a.m. for a while.

Be agent-savvy

• Many states regulate how agents deal with new subdivisions. If you have your own agent, (and you should) tell him up front that you're interested in looking at new homes.

Get the Skinny on Your Builder

• Make sure there are no Better Business Bureau complaints on file against your builder's company.
• Ask your agent if the builder has a good reputation in the community.
• Visit your builder's previously constructed homes; ask the occupants whether the craftsmanship has stood up to time, use and weather.

Upgrade the smart way

• The markup on upgrades is substantial, so investigate each option you're considering to see whether it would be cheaper to bid it out after you move in.
• Builders, in general, need to sell quickly to make a profit. If you're stuck haggling over price, get them to throw in the upgrades you want at a reduced cost or for free -- it's a way to get more value that's appealing to both sides.

Don't skip the inspection

• Never assume that because a home is newly constructed, it isn't going to have defects. Make your sales contract contingent on a final inspection by a professional you hire.
• If possible, have the home checked during each phase of building, when potential problems are easier to spot. If the builder objects to this, consider it a red flag.
• Know that municipal inspections for code violations are nowhere near as thorough as an independent professional inspection is.

Protect yourself with warranties

• All new homes come with an implied warranty from the builder stipulating that any major defect of the structural integrity of the home must be repaired.
• You should ask for a builder's warranty for a period of time following move-in (a year, for example) that covers any defects in craftsmanship.
• Preferably, this warranty should be backed by insurance.
• Make sure any warranty you receive explicitly states what is covered and what isn't, and what the limitations for damages are.
• For extra peace of mind (which we're fans of), whip out your real estate attorney again and have her look over the warranty to make sure it's kosher.

And if you're looking for an existing home, of course we would love to help with that as well. Please give the Spouses Selling Houses a call. Until next time!! Ebbie :)

Banks to "Loosen" credit standards?

Capital Economics expects the housing crisis to end this year, according to a report released Friday. One of the reasons: loosening credit.
The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.
Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.
Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.
Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.
While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in the month of November, 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.
Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generation actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability. Let us help you find the home of your dreams, and guide you through the entire process. Until next time. Thank you, Ebbie :)

Are Most Homeowners Happy About It?

It might come as a surprise but a whopping 72 percent of surveyed homeowners nationwide are satisfied with owning a home. The other 28 percent, not so. They say they're dissatisfied and that's likely due to the devaluation of their homes.
 
But surprisingly, of those who were satisfied with owning a home, only 24 percent said it was because of home appreciation. The majority, 76 percent, had many other reasons they were happy to own their own home including the one that proves the American Dream is alive and well: pride of homeownership. Following closely behind were the freedom to control their home improvements and upgrades. All this according to HomeGain's 2012 National Home Ownership Satisfaction Survey.
 
Of those who were unsatisfied with owning their home, 63 percent blamed depreciation as the root of their dissatisfaction. However, the cost of owning a home, such as paying for property taxes, homeowner's association fees, upkeep, and routine repairs, also sucked the joy out of homeownership and led this group of 37 percent to be unhappy about homeownership.
 
On the bright side, most - three out of four - are very happy with homeownership even in spite of such rocky real estate times where declines in home values have crippled some homeowners severely.
The survey polled homeowners all across the country. So you might be wondering is there a connection between where you live and how satisfied you are with owning a home?
 
The highest percentage of satisfied homeowners comes from the Northeast where there is 77-percent satisfaction, according to HomeGain. Pulling in at a close second is the Southeast at 73 percent satisfaction. The West and Midwest were at 71 percent and 68 percent, respectively.
Those who purchased their homes within a timeframe of the past three to eight years were the least satisfied. If they bought more than eight years ago, they tended to be more satisfied.
The higher-end market was the least satisfied with owning a home, especially if they paid more than $800,000 for it. This group's dissatisfaction rate was 69 percent. But those who purchased homes for under $75,000 are cheering. This group's satisfaction rate was 77 percent.
 
Of course, a lot of homes are sold through foreclosure and short sale, which, depending on the side of the sale you're on, can leave you satisfied or very dissatisfied. Those purchasing a foreclosed or short sale had the highest satisfaction ratings; 79 percent and 83 percent, respectively.
New and existing homes didn't fare so well with homeowners. They were fairly dissatisfied and showed it in a 73 percent and 71 percent rating, respectively. Most seemed to have expected an increase in the value of their home and when depreciation hit, this highly disappointed them, making this the primary reason for their dissatisfaction.
 
An interesting statistic may reflect the need for freedom from being tied down to a home and its maintenance as well as other costs. Homeowners ranging from 18 to 25 were the least satisfied (45 percent) with owning.
On the other end of the spectrum, those homeowners between 55 to 65, were the most satisfied with their homeownership. This group's satisfaction rating was 76 percent.
HomeGain collected some comments from some of the surveyed homeowners. Here's how one satisfied homeowner summarizes homeownership, "Just knowing I own it. I rented a house two times after owning a home for 16 years, and I do NOT like relying on, and dealing with, a landlord! I also feel pride in owning my home. I just bought a house 8 months ago and am very happy!" If we can help you feel the joy of ownership, please call the Spouses Selling Houses at 573-302-2313. Until next time!! Ebbie :)

REFINANCING UNDERWATER MORTGAGE PROGRAM PROPOSED

Following weeks of rumors and speculation, President Barack Obama said he would be sending Congress a proposal to provide refinancing for underwater homeowners that will save borrowers up to $3,000 a year during his State of the Union Speech last week.

The announcement could not have come with better timing. Mortgage applications fell for the first time in three weeks for the week ending Jan. 20th, indicating that the housing market remains in a slowdown even after other government efforts have been made to reenergize the market, according to the Mortgage Bankers Association.

The new refinancing plan would target underwater homeowners and reportedly allow a few million mortgage holders to refinance, reducing their monthly payments through the Federal Housing Administration.
The program, which needs Congressional approval to be launched, would broaden the availability of government backed mortgages to include borrowers whose mortgages are held by private banks and investment companies that are not guaranteed by Freddie Mac or Fannie Mae.
The bankers’ composite index of mortgage applications fell by 5% on a seasonally adjusted basis from one week earlier. Refinances dropped 5.2% even after another new government sponsored program went into effect before the end of the year allowing many underwater mortgage holders to refinance home loans, despite loan to value levels.

Five years after the real estate market collapse, Obama also said during his speech that he would direct Attorney General Eric Holder to expand the federal government’s investigations of mortgage lenders and servicers.

Obama gave few specific details on his refinancing program, but said that the plan would be available to give “every responsible homeowner” a chance to save $3,000 a year off their mortgage payments by refinancing at lower mortgage rates. Obama said that the program would be funded by a “small fee on the largest financial institutions (that) will ensure that it won’t add to the deficit, and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.”

The president also said he would seek additional regulations to curb the real estate finance industry from predatory lending practices, which regulators are working on as part of Dodd-Frank financial reform laws passed by Congress.

“We’ve all paid the price for lenders who sold mortgages to people who couldn’t afford them, and buyers who knew they couldn’t afford them,” Obama said. “That’s why we need smart regulations to prevent irresponsible behavior. Rules to prevent financial fraud, or toxic dumping, or faulty medical devices, don’t destroy the free market. They make the free market work better.”
For all of your Real Estate needs at the Lake of the Ozarks, just give the “Spouses Selling Houses” a call. Thank you!!! Ebbie :)