Should You Buy a Home?

The Zillow Home Value Index fell 26% (national average) since its peak in June 2006. That’s a greater decline than seen in the Depression-era years of 1928 to 1933.

According to Zillow.com, "November marked the 53rd consecutive month of home value declines, with the Zillow Home Value Index (ZHVI) falling 0.8% from October to November, and falling 5.1% year-over-year.” Remember these are national figures, not Rochester-specific.

However, all signs point to an increase in consumer confidence and the economy getting better. Maybe. But, if you’ve been watching, waiting, and wondering, when to buy ... . Now’s the time to take note. While no one can predict what will happen with the housing market, some experts are reporting that an uptrend will occur later this year. They’re basing their beliefs on the job market (some predictions indicate it will improve half-way through this year), and "Homebuilder exchange traded funds are above their 200-day moving averages,” according to ETFTrends.com

Signs indicate you could possible buy low now, and sell high later.

A simple way to look at real estate is to understand your specific needs, wants, and long-term goals. Do you need a place to live? Are you planning to stay in your home for at least a couple of years? (Most buyers live in their home on average seven years). Does owning your home matter? Have you saved money for a downpayment?

Answering these questions will help point you in the right direction. Timing the market is like trying to win the lottery. There is no absolute way to know when it’s the bottom of the real estate market. That’s why you must know your specific needs, wants, and long-term goals.

If your needs include a home to live in for a lengthy period of time, then homeownership will likely rank higher on your priority list. If building credit, potential of appreciation–yes, there is still appreciation–especially when you buy a sensibly priced home in a good location. However, the appreciation may be slower and not shoot up into the double digits that we saw in some areas.

Consider this, with high inventory, sellers are motivated. You can scoop up a home at a perfect price and you can minimize your potential for low appreciation. If you choose a home that is in the lower-tier of prices (and still within your target price), your home will be less vulnerable in down markets and better situated in up markets because the higher-priced homes help elevate your home’s value.

Homeownership has many benefits including tax deductions, the opportunity to make your own creative changes to your home, and the potential for income if you later rent it out.

Tips for Appraisals

Appraisals allow homeowners and buyers to establish what is fair market value of a property. In addition, an appraisal allows a lender to know how much they can safely lend.

This process, however, can be trying and even frustrating. Sometimes an appraisal can even put the kaibash on a deal. To reduce your stress during this time, consider these simple tips:

•Understand the role of appraisals. It is neither in your interest nor the interest of your lender for you to purchase a property that is over-priced for its value.

•Make sure the lender hires a qualified appraiser. The lowest priced appraiser does not necessarily equate with the most qualified. This is a time to get the numbers right.

•Accompany the appraiser during the inspection of the property if possible. The more active participant you are in the process, the more you will understand it, and be able to catch any errors.

•Request a copy of the appraisal report from the lender. Federal law requires that you receive a copy of the appraisal within 30 days.

•Examine the appraisal report and ask questions. Be sure to examine the report for errors.

•Appeal the appraisal if appropriate. Market conditions do change, especially in these economic times. If you feel that new information may change the appraisal, be sure to contact them!

•Ask the lender to order a second appraisal by a qualified and designated appraiser.

•File legitimate complaints with appropriate state board or professional appraisal organizations.

For more information on appraisals, you may wish to visit The Appraisal Institute's website at www.appraisalinstitute.org.

Mortgage Rates Inch Up Again, It's Time to Buy

Freddie Mac released the results of its Primary Mortgage Market Survey® (PMMS®), which found that both fixed- and short-term mortgage rates continued to rise this week. This was the fifth week in a row where fixed-rate mortgage rates were up.

30-year fixed-rate mortgage (FRM) averaged 4.83 percent with an average 0.7 point for the week ending December 16, 2010, up from last week when it averaged 4.61 percent. Last year at this time, the 30-year FRM averaged 4.94 percent.

What does this mean to you, the buyer? It means rates are still low but inching up. Rates are still lower than last year. So, perhaps you should get while the gettin's good? It may be time to buy before rates go up much higher.

Homeownership Going Back to a Long Term Investment

Is there value in owning a home? The recently released 2010 National Association of REALTORS® Profile of Home Buyers and Sellers brings some promising results. Today homeowners are living in their homes longer, and after several years of price declines, are seeing rises in home equity gains.

It was only earlier this decade that so many buyers jumped on the investment bandwagon. They bought and sold within incredibly short time frames, and walked away with profits. But as the booms busted, many sellers found they had bought at the top of the market and as prices corrected, they lost more than just dollars. Foreclosure rates skyrocketed. Historically, however, homeownership is a long term investment, and one that brings many rewards.

Current market and economic conditions have created a shift from the house flipping ways of the boom. The house flipping and quick gains which occurred during the boom period were abnormal, driven by risky, easy-money financing that should never have been allowed in the market.

American are still buying, however. And surveys have found there are particular reasons behind these purchases. These include the desire to own a home, the desire for a larger home, a change in family situation and taking advantage of the home buyer tax credit, a job-related move, and then the current supply of affordable homes.

And once they buy, homeowners are staying put longer. A typical seller has been in their home for 8 years, but the survey reveals first-time buyers are planning to stay for 10 years, and repeat buyers for 15 years.

Even with several years of price declines, the typical seller who purchased a home eight years ago experienced a median equity gain of $33,000, a 24 percent increase, while sellers who were in their homes for 11 to 15 years saw a median gain of 40 percent. So, once again buying for the long-term is steering its way back into value.

Sellers, Don't Let Your Emotions Get the Best of You

It can be easy for the selling experience to become clouded by emotion. A homeowner may have years of memories stored within the walls of a home. They look at a room, and instead of resale potential, they see a baby's first steps and early Christmas mornings. When the time comes to sell, however, the time has also come to sever emotional ties with a house.

Emotions can cloud your reasoning. And they can misguide you during a very expensive and important business transaction. Sellers sometimes overvalue their homes, adding in sentimental value on top of property value. They refuse offers that, while reasonable, don't add up to the value of their memories. Or they turn down a potential buyer, because they don't garden and won't "leave the rose bushes," or aren't the "type" of person they'd like living in their home.

For a smooth transition, hire an experienced real estate agent. Once you've turned yourself over to their guidance, you can then turn your focus onto the new phase of your life. And agent can help you establish a fair, and unbiased, asking price. They find the sellers. They show the house. And they help you sign on the dotted line. The middle man is extremely beneficial in separating from your emotions.

Your emotions may surface as soon as you list the house for sale, since many agents will suggest you remove many of your personal items from the house for staging. This is neither a personal attack on your decorating nor your memories. Staging is a wonderful way for homeowners to see the house as their future home, instead of seeing your house and your home.

Don't fret over lost memories; take pictures of your home and make a scrapbook. Channel your emotions into the joy of moving. And have fun imagining the new memories you'll make in your new place. This is not a time for mourning, instead it's a time for celebrating!

Operation Home Relief

The National Association of Realtors has extended its successful "Operation Home Relief" campaign, which is designed to give military service families a voice by contributing financial counseling and aid to help keep them in their homes. Though only launched last month, the NAR has already matched $20,000 in donations.

The NAR has used this Facebook campaign to promote USA Cares, an organization dedicated to providing aid to help post-9/11 veterans and active-duty military personnel avoid foreclosure.

Through the consumer website, HouseLogic.com, a free comprehensive website about homeownership for homeowners, Operation Home Relief aims to increase awareness, rally support and raise funding that provides foreclosure assistance in the form of financial counseling and grants to post-9/11 active duty U.S. military service personnel, veterans and their families."

Invite your friends (Operation Home Relief will donate $1 for every join until they reach their goal) by visiting apps.facebook.com.

Make the Most Out of Listing Your Home During the Holidays.

If your house is on the market during the upcoming holidays, step up the action plan to draw attention to it. Don’t let the holiday blues make you feel like there’s no hope. Homes are sold and bought this time of year. But the ones that get snatched up are the ones that are enticing to buyers.

Because this is a very busy time of year with personal travel and holiday celebrations, many real estate experts note that if you have buyers dropping by your open house or making an appointment to view your home, there’s a good chance they’re serious buyers.

There are some things you can do to make your home more “showable”. It's often said in the real estate industry, “the way you live in a home is not the way you stage a home.”

So, while this time of year often brings out all the holiday decor, there is such a thing as too much holiday cheer. It’s just that not all buyers celebrate the same holidays.

A good rule of thumb, is to keep decor simple and subtle. If you celebrate Christmas, go ahead and put a tree up but don’t put one up in every room. Remember that buyers will be looking at your home and imagining their own holiday celebrations there. So, be sure to leave them room to envision their lives in the home.

This goes for the outside too. Holiday lights can be placed outside very tastefully but ditch the huge inflatable characters that make it look like your yard is an amusement park. Instead, opt for a nice holiday wreath and some subtle seasonal decor. Keep in mind that curb appeal is what gets buyers in the door. If your home isn’t appealing from the outside, buyers won’t bother to stop for a look inside.

Stash the gifts. If you usually put them under the tree or around the house, save them for the day of your celebration. There are two reasons: presents take up precious floor space and they are a distraction. It’s a good idea to keep as many personal belongings as possible in a safe, private place.

Especially in cold weather areas, cinnamon pine cones or some other mild potpourris can be a pleasant welcome. But don’t go overboard with different fragrances in every room.

Another nice touch is to spruce up the mantle. However, if you usually hang stockings with your family’s names on them, you might consider using less personal ones while showing your home. It’s the same reason, stagers will put away your personal photos—to create a space where buyers can imagine their photos and belongings in.

Listing your home for sale during the holidays doesn’t have to make you blue; in fact it can truly brighten your spirits by putting some green in your bank account. Just be sure to focus on making your home a buyer’s dream this holiday season.

Feng Shui Basics - Water.

Feng Shui is an ancient Chinese ascetic which plays upon the idea of creating ideal energy flow within your home and life.

Its goal is to achieve proper flow of Qi, pronounced chee, or life energy. And through proper energy flow, you can help invite balance, harmony, and prosperity into your life.

The five elements commonly mentioned in Feng Shui, as well as other works of Chinese literature, are metal, earth, fire, water, and wood.

Let's focus on the basics of "water."

In this discipline, it is all about placement. You can start with the front door to your home. By placing a water feature on the left-side of the door's exterior (inside looking out), you can bring in good luck! There can be too much of a good thing, however. And that means water features on both sides of your front door can lead to unluckiness.

Where should you place water features? Ask yourself where you'd like to enhance learning? Try out an office or kid's study area.

Just avoid placing a water feature in a bedroom, bathroom, or kitchen.

If you are in the need of some "good luck" then consider placing a water feature in your "wealth spot."

In Feng Shui, this is located at the corner diagonally across from the living room entrance. Consider placing a fish tank in this great location! Even a small goldfish bowl can work it's feng shui magic.

Of course, you can always harness the true power of water by building or buying a house near an existing body of water! Wherever your home, keep water as a part of your balanced life.

Is a Foreclsure Right for You?

Does buying a foreclosed property save you money?

If you are looking to make an investment, however, you need to consider the market in which you are buying a foreclosure. A weak and ailing market could mean values will continue to fall. Buyers may be scarce. This is not an ideal environment for an investment.

Other issues must be taken into consideration, as well. The process of buying a foreclosure can take weeks longer than traditional deals. This is simply the nature of the beast. A foreclosure is a legal process. A foreclosure also means you must buy title insurance. A title search will pick up errors before you sign the check and protect you if something was overlooked. In the unlikely event that a former owner returns to challenge the foreclosure, the insurance company will defend you.

Foreclosed houses also warrant very close home inspections. There have been horror stories of new owners finding cement poured down drains by the disgruntled evicted. Be sure to see the house for yourself before you sign on the dotted line. And have a licensed professional carefully examine the home.

Even if the property hasn't been purposefully vandalized, many foreclosures need extensive repairs. A home may simply have been neglected and older homes require updates and normal upkeep. Budget carefully as you assess how much work the property will require.

If you take all of these matters into consideration, a foreclosed property may be the ideal buy for you.

Go Green and Be Warm with Heated Floors!

It's that time of year again! We're feeling a chill in the air and the leaves are turning, you know it’s time to load up the fireplaces with wood, close up the windows, and turn on the floors.

Say what? Turn on the floors? Yes, radiant heating is as attractive to cold toes, it's better than wool socks!

These days radiant floors are becoming more popular especially for those interested in green design. There are several benefits for the environment and your pocketbook. As the floors get toasty warm, they help heat the rest of the room by warming it up and making it more comfortable on a cold night.

A lot of people rely on central heating systems and while these work, they often fill the upper part of the room with hot air--making it stuffy and not quite providing the warmth needed where people are actually present in the room. The even heat distribution helps lower the cost of the home’s heating bill.

But perhaps the two biggest advantages are silent and unseen heating. With no heat registers or radiators, you can place furniture how you like without being concerned about blocking a heating system. Of course, there will be no forced hot-air fan noise, making this an invisible heating design.

The concept isn’t new, heated floors date back centuries. The Romans used to channel hot air underneath their floors to warm their villas. Today, it’s the allure of going green that also adds to the interest of installing radiant floors.

Some Home Buying Tips...

As you hit the internet or paper or start calling your favorite real estate agent, such as myself... here are a few things you should consider:

• Study - Do your homework before you buy. Review the prices of comparable homes in the neighborhood, a real estate agent can provide the latest sales data.

• Cure your credit - Today's best mortgage rates require a credit score of more than 700. Learn how to boost your credit score before you apply for a mortgage. Not only will a low credit score cost you more in terms of the interest rate on your mortgage, it could also prevent you from obtaining a mortgage.

Go to AnnualCreditReport.com, the only federal government-sanctioned service for obtaining a truly free credit report from one or all three of the major credit bureaus. The report is free, but you will have to pay a nominal fee to get your credit score.

• Consider a 'Lucky 7' loan - Take advantage of the lower interest rates available with a 7/1 adjustable rate mortgage (ARM), when compared to a fixed-rate 30 year mortgage. The interest rate on a 7/1 ARM is fixed for seven years. In the eighth year the loan resets as an ARM. Just be sure you know what the margin, life cap and periodic caps will be beginning in the eighth year to avoid surprises. Use those seven years to reduce debit and increase your income in preparation for what is likely to be a much higher rate than your starting rate.

• Get pre-approved - Go beyond prequalifying for a mortgage, which only tells you what you can likely borrow. Get a pre-approved mortgage and you'll know your home price shopping parameters. You'll also present yourself to the seller as a serious buyer. Financing in hand will also help level the playing field with all-cash buyers and investors and it will help you negotiate a better purchase price. I CAN'T STRESS THIS ONE ENOUGH!

• Inspect everything - Get a home inspection for a new home, a resale home, a nearly new home or a very old home. Always. Just because it's new doesn't mean it's defect free. Hidden problems can torpedo the value of your home.

• Read the title report - Make sure that any new additions or construction to an existing home are fully permitted and recorded with the local municipality.

• Check the appraisal - Likewise check the appraisal report for any oversights, missed features or other errors that could cause the property to be undervalued.

• Negotiate - Don't be afraid to dicker. It's a buyers' market. Concessions are available from both new home builders and existing home sellers. Ask for help with the closing costs, repairs, even furnishings and other perks. Motivated sellers have much to offer.

• Don't skimp on the help - If you look for the least expensive attorney, real estate agent, inspector, etc., you will get what you pay for. Ask family, friends, co-workers, realty professionals and others you trust for referrals and then carefully vet them.

It's Gutter Time!

As the leaves are starting to fall right now, it's time to think about cleaning the rain gutters.

Debris from pine needles and leaves that collect in the rain gutter can lead to a fire hazard as well as block the rain gutter’s function, causing water to back up and potentially weaken the gutters and the home’s eaves. It can also create standing water which can lead to rot, mold, and mosquitoes.

Trying to clean gutters yourself can be quite dangerous. There are several deaths a year that were caused by falls from roofs or ladders while cleaning gutters.

There are some systems on the market that claim to keep the gutters free of debris and leaves. However, experts caution that in heavy rain storms sometimes certain products may malfunction by causing the leaves to dam up on the rain and prevent rain from entering the gutter too.

The bottom line? Use experts to safely clean your gutters. And even if you have gutter guards, don’t rely solely on them--have your gutters checked regularly.

What You Need to Be Your Own Handyman...

Now that you have moved into your new home, it's time to put on a new hat, that of "handyman." For the big jobs, like roofing and rewiring, you'll more than likely still rely on a professional. And unless you are truly versed in those specialties, that is what we'd recommend!

But there will be many small jobs that come up which you will be able to fix on your own. To complete those jobs, you'll need tools.

So, what tools will you need as a new homeowner? Here is a list of suggestions:

1. A toolbox. Keep everything together and you'll never waste time hunting for the right tool.

2. Hammer. It seems basic enough, and it is. If for nothing else, you'll need it to hang all your artwork and pictures.

3. Level. From hanging pictures to framing a garage, a level is a must for any handyman.

4. Screw Driver. You'll need more than one! Be sure you have multiple sizes of both phillips-head and flat-blades.

5. Plyers. Have you ever tried to disconnect a fitting on a pipe? You need plyers.

6. Hand Saw. Many handymen prefer power tools, but for those remote spots with no electrical access, you can always count on a hand saw.

7. Tape Measure. How long does that new counter-top need to be? Do we have room for the couch to fit through the front door? Exactly. Use a tape measure... measure twice, cut once!

8. Wire cutters. For what else? To cut wires!

9. Cordless, Reversible Drill and Bits. Uh... for drilling and taking out screws.

10. Utility Knife. This is great for cutting exact edges.

11. Vice/clamps. Connect a vice to your workbench and use it to stabilize items you are cutting.

This is just a starter kit. There is a tool for practically every need, so over time, your tool box will grow considerably!

Becoming your own handyman is a learning process, so don't be too hard on yourself. There will be a lot of trial and error. That's half the fun. Enjoy your new home!

Some Tips to Avoiding Foreclosure...

In a country with a growing foreclosure rate, new default notices being sent every day, and an unemployment rate over 9 percent, the chances of foreclosure affecting you or someone you know is on the rise.

If you find yourself struggling to make your payments, here are some ways to avoid foreclosure.

First, be realistic about your situation. Answer phone calls from your lender and open your mail. This is the time to face your problem head on. Could a foreclosure be on the horizon?

If you are having trouble making monthly payments on other bills, now is the time to pay attention. Your mortgage could be the next bill that becomes too much. In order to curb missed payments, prioritize your spending.

Establish a budget and cut out any unnecessary spending (e.g. movies, cable, eating out, shopping) until you are in a more stable financial state. Apart from healthcare, there is nothing more important than your home. If you have assets to sell off, then do so! The cash may be better spent in helping you save your home.

Next, call your lender to explain your situation and to see what options are available. In these tough economic times, many lenders have programs that may help you stay in your home. Foreclosures do more than run ruin on your credit score, they also affect a lender's bottom line. If working out an agreement with you can help them save that bottom line, the changes of them helping you are high.

Some options you may discuss with your lender include refinancing, reinstatement (where your lender allows you to pay the money you are behind in one lump sum and by a certain date), forbearance (a temporary reduction or cessation of your mortgage payment), a new repayment plan, and loan modification (a permanent change to some of the terms of your existing mortgage).

Beware of scammers during this process. Help and counsel from your lender should be free of charge. If you come across someone requesting a fee in order to facilitate help, chances are it is a scam.

The sooner you contact your lender, the better. Don't wait until you are days away from being foreclosed. The process of working out an arrangement with your lender could take multiple phone calls and weeks of time.

What's Eating You? Maybe it's Termites...

Don't let termites prevent the sale of your home.

There are a few signs that may indicate there might be an infestation. Termites tend to be most active in states with warmer climates, but can be found nearly anywhere and the varieties of the insects differ depending on the area and climate.

Many homeowners don't think about the possibility of having termites until they're getting ready to sell their home. Unfortunately, a history of termite issues can eat away at the sales price. Being prepared and understanding what to expect from an inspection is not only helpful but could help ensure a better price and smoother home sale.

Here's what you should know about termites.

If my neighbor's home is infested; will mine be attacked next? TermiteInstitute.com says not necessarily. However, the risk is, of course, high. Preventive treatment is recommended.

How are homes treated for termites? The methods vary depending on the severity and the professional company that you choose but a couple different methods include, termite bait systems (requires termites to eat poisonous food) and, liquid termite treatment (poisonous liquid applied throughout the structure and surrounding soil).

Will my homeowners' insurance pay for treatment? It's not likely. Although, in some areas of Louisiana some insurance companies have covered termite treatments for those structures that suffered hurricane damage.

While termites are annoying and can certainly eat away at your sale price. They can cause severe structural damage, but they are not harmful to humans. It's best to know right away whether you have an infestation and what your options are to resolve the problem. It could save you money and frustration when it comes time to close the sale on your house.

How to Prepare for Open Houses

Many sellers love houses, but having to clean and get their home organized to possibly snag a buyer.

But preparing for an open house doesn't have to be difficult. If you're living in your home and trying to show it, here are a few quick tips to get you organized.

- Coil it up! This might not come to mind right away but, until everything is wireless, we have to deal with those unsightly long cords. Using devices, such as the Cableyoyo or even twist-ties, will clean up the clutter and leave your electronic areas looking much better. When you have electrical cords in a jumble behind your entertainment center (but still in view) it creates a feeling of chaos and clutter--not to mention, the cables collect dust and then can create an impression in the buyer's mind that the home is dirty.

- Off the table into the portable bin. Get a portable file cabinet--small but one that can hold about a week's worth of papers. Leave it in the living room and instruct family members to place their papers in their labeled folder when they're finished reading them.

Homework, newspapers, documents that need signing should all be placed in the family member's folder and not stuffed in between couch cushions, entertainment center shelves, or left on the coffee table. Just before the open house, you can easily and quickly do a sweep of the rooms, picking up papers and storing them in the appropriate folder in the portable file cabinet.

- You don't want Guns 'n Roses singing "Welcome to the Jungle". Go green selectively. We're talking house plants in this next tip. The folks at HGTV recommend that your house plants be placed on a cute stand or in several decorative pots. While plants are usually seen as a welcome addition, creating a jungle with too many big, sprawling plants in your living room won't go over well.

- Put all your personal care products out of site in the bathroom. Clutter is not attractive and no one wants to see your anti-fungal foot spray.

Implementing these quick tips can help you be prepared in a moment's notice, saving you hours of searching for items that would have otherwise been swept up and crammed into any hidden place.