March 14, 2011 By Leave a Comment

Check out this list of ways to buy and sell a fixer-upper!

How to Buy and Sell a Fixer-Upper

It just needs a little TLC, right? If you’re willing to put some elbow grease into it, buying and selling a fixer-upper can be a profitable endeavor. But there’s a level of risk involved, not to mention a substantial commitment of time and effort on your part, and long periods of time when you will be living in chaos and sawdust. If you’re still up for the challenge, it can be a rewarding experience.

Instructions

1. Decide on the geographic area in which you want a property. Whether you intend to live in a home or not will impact where you’ll want to buy. Remember that your ideal place to live may not be the best place to invest in property.

2. Be prepared for an extensive search. Many fixer-uppers–particularly those in especially bad shape–don’t command much attention, so you may have to hunt around. Drive through desirable neighborhoods to spot “For Sale” signs.

3. Keep in mind that “location, location, location” is still the mantra of real estate purchases, whether for a fixer-upper or a single family home. Steer away from properties in areas that are going downhill, because you’ll have trouble recouping your investment no matter how beautiful the structure. Find out if the asking price of that fixer-upper is comparable with the prices of other homes on the block. Make sure the fixer-upper is in an area of appreciating house values. That way, your house will be worth even more when your repairs are completed, rather than less because of worsening market conditions in the neighborhood. Try to meet some of the neighbors who might give you some information on what’s been going on in their block.

4. Look in the classifieds, and at community bulletin boards or other public spots for the magic words “fixer-upper,” “needs TLC,” “handyman special” or “diamond in the rough.”

5. Review local listings of foreclosed properties in your city. When banks or municipalities have had to take ownership of a property, they’re generally very motivated to hand it off to a private buyer like you (See How to Buy a Foreclosed Home). Contact real estate agents to see if they are listing a fixer-upper.

6. Keep an eye out for properties that need only cosmetic improvements. Houses that could use new paint, carpeting or flooring are the least expensive and offer the fastest potential turnaround. Larger problems such as bad roofs or faulty foundations are often prohibitively expensive and undermine eventual profit, depending on what you got the house for and how much you think you can sell it for.

7. Watch for vacant homes that have not been kept up by the owner. These forgotten houses can often have the most motivated seller you could hope to find.

8. If you find an appealing property with seemingly reasonable repair needs, confirm. Have the home professionally inspected. Specify that the final sale is contingent on a satisfactory complete inspection.

9. Accompany the inspector when he or she goes through the house for a blow-by-blow account. Then review the report in detail to see what’s wrong. You may also need to get additional inspections including soil, pest, roof and seismic. Be sure the inspector generates a narrative report rather than a checklist.

10. Get a formal appraisal ($200 to $400) of the home’s value and have your agent work up comparables. If possible, have the appraiser estimate how much the home should sell for after it is restored to good condition.

11. Set your target purchase price. Pros suggest bidding at least 20 percent below its potential fixed-up value.

12. Get several bids from contractors of how much it will cost to fix what needs to be fixed (see How to Hire a Contractor, Plumber, Painter or Electrician). Be sure to check zoning requirements and include permit fees. The house’s value should increase at least $2 for every dollar you spend on improvements. Calculate the potential value of the house after renovations and be sure that it isn’t higher than comparable houses on the block. Be realistic about repair costs.

13. Make the final sale contingent on obtaining a satisfactory bid for improvements. That way, if the bids you receive are simply too expensive, you can back out of the deal. Keep in mind that contingencies of any kind could make it hard to negotiate a lower price or even make a deal in a seller’s market when competition among buyers can be intense.

14. See How to Shop for a Mortgage, and pursue a mortgage that includes funds for home renovation, such as the Federal Housing Authority 203(k) program.

15. Make whatever repairs and renovations are necessary and then sell the property. (See How to Sell a House.)

Primary Residential Mortgage, Inc’s, TeamPrimary is now doing 203K Rehab Loans! Visit us at TeamPrimary.com or check us out on Facebook at www.Facebook.com/TeamPrimary!

March 1, 2011 By Leave a Comment

Looking to improve your home? Figure out how to make the best home improvement decisions while getting back what you paid for when it comes time to sell.

Below is an article posted in Inman News™ by Dian Hymer about how to make cost-effective home improvements.

The post:

Imagine walking into an important job interview looking like you just dragged yourself out of bed. You’d be unlikely to make a good impression and diminish your chance of securing the job.

The same goes for selling a home. First impressions are lasting. Some buyers won’t even look at the inside of a listing that doesn’t have good curb appeal.

Today’s buyers are picky. There is no sense of urgency in the market, so buyers are holding out for the best home they can find that will work for them for years to come. In some areas, there are a lot of homes for sale. It’s important to make sure that buyers will be attracted to your home before they even walk through the front door.

Fortunately, exterior improvements needn’t be expensive. The recent Remodeling Cost vs. Value Report 2010-2011 found that the improvements that yielded the highest return on the investment when sold were a new steel front door and a new garage door.

The average cost nationally for a new front door was $1,218; the return was 102 percent. The average cost for a new garage door was $1,191; the return was 83.9 percent. The top nine of 10 most cost-effective improvements nationally were for exterior projects. Curb appeal is as important as ever, and may be more so in this market.

The Remodeling Cost vs. Value Report is a collaborative report done annually by Remodeling Magazine and the National Association of Realtors. It compares construction costs with resale values, which are based on estimates from more than 3,000 Realtors and appraisers.

Sprucing up the front yard for sale needn’t be costly. Clean out weeds and dead plants. Add flowering plants for color and mulch to tidy up areas that aren’t heavily planted. Replace a lawn that has seen better days with less lawn and a border bed of flowering shrubs.

Do in-ground planting well in advance, if possible, so that plants have a chance to get established before your home goes on the market. If you have no choice and must plant at last minute, be sure to remove the ID tags from the nursery.

A deteriorated fence should be removed, repaired or replaced. Any peeling paint on the front walk and steps and house exterior and trim should be refreshed. The side of the house that gets the most exposure needs the most maintenance. If you’ve let it go, you’ll be docked dollars by the buyers unless you repaint where needed before you sell.

HOUSE HUNTING TIP: The amount returned on home improvement investments varies from one location to the next. It’s important to consult with your local real estate agent before you embark on an upgrade to make sure that you don’t overpay on an improvement that won’t generate the desired result.

Most homeowners assume they’ll get their money back and more when they sell. In fact, most upgrade investments often don’t return 100 percent of the amount invested, particularly in a down market.

A minor mid-range kitchen remodel returns 72.8 percent nationally, according to the 2010-11 Remodeling Cost vs. Value Index. In the Pacific region of the U.S., you’re likely to recoup 84.1 percent.

However, a major upscale kitchen remodel pays back only 59.7 percent nationally and 66 percent in the Pacific region. It makes sense to take on a major remodel project only if you’re staying in your home and can enjoy the use of the improvements before selling.

A deck addition ranked high on the list of popular exterior improvements. Although, nationally the cost recouped is only 72.8 percent, it may be an essential enhancement if your home has no outdoor living space and all the homes for sale in your neighborhood do.

THE CLOSING: Supply and demand in your local area will also impact how much you’ll recoup from your fix-up investments.

[Read More]

For your mortgage needs, contact Primary Residential Mortgage, Inc – TeamPrimary. We are here to help!

February 1, 2011 By cg_wsm Leave a Comment

When we think about increasing the value of our home, we think major repairs or updates. However, you can add value to your home without breaking your budget.

Here are some inexpensive ideas to help increase your home value:

1. Outside Appearance

Keep up with routine yard work, mow, weed whack along the sidewalks and house. Trim hedges and remove weeds.

2. Indoor Clutter

Organize and get rid of clutter. A tidy house will seem larger and more appealing to potential buyers.

3. Refinish Kitchen Cabinets

Since cabinets make up most of the kitchen, outdated and worn cabinets can ruin the whole kitchen’s appearance. Refinishing cabinets are relatively cheap and easy to do. Learn how to refinish cabinets at ehow.com

4. Wash Walls, Windows & Siding

It’s less expensive to just wash walls or siding than to repaint or replace siding. Pressure-wash siding and wipe down interior walls. Clean your windows of any dirt and water stains.

5. Fixing Interior Walls

Patch up any holes, even the smallest ones. Then apply a coat of primer for a smoother finish. After the primer dries, lightly sand it down, wipe the walls with a damp cloth and apply fresh paint. This will help restore the walls and make them like new.

6. Replace Window Coverings

Over time blinds and curtains become wore out and faded. Replacing the old with the new will make a better impression.

7. Flooring

Shampoo or steam clean your carpets. Sand down and refinish hardwood flooring. Learn how to refinish hardwood floors at ehow.com

8. Install New Switches & Outlets

Replace old switches with new ones. Just be sure to turn the power off in the room or entire house before doing anything. Not only will the new outlets look nice, but it will give off the impression that the electrical wiring in the house is newer than it really is.

9. Brighten Up Your Home

Try replacing your regular light bulbs with fluorescent light bulbs to make the rooms brighter. Using fluorescent light bulbs save energy and money.

10. Trim & Molding

Simple trim around ceilings, doors and windows are easy and one of the most typical upgrades found in new homes.

If you or anyone you know is looking to purchase or refinance a home, Primary Residential Mortgage Inc. can help! Visit us on Facebook at www.Facebook.com/TeamPrimary!

December 30, 2010 By cg_wsm Leave a Comment

By: TeamPrimary

Don’t waste money renting; invest in a home of your own!

There are a few advantages when considering buying your own home over renting. Although you’ll need certain qualifications such as decent credit, a deposit and a stable job, you will also need those same qualifications when renting a home as well. Think about all the money you put toward monthly rental payments when you can be investing that same money into a home of your own.

Buying a home is an investment.

If you buy a home then your monthly payment reduces what you owe. Eventually your mortgage will be paid off and you will be free of a monthly mortgage payment. When owning a home and choosing to make improvements it increases the value of the home benefiting the home owner for when they choose to sell.

Personalizing the home.

When owning your own home you are not limited to how many people occupy the home. There are no documents pertaining to a specific number of people allowed. Also pets are not banned from the home like most rental properties. You can customize by painting, adding detail and changing any major features in the home to fit your comfort.

Now is the time.

It is officially a buyer’s market! Right now is the best time to buy a home. With interest rates being at an all time low and home prices dropping makes buying a home affordable.

If you are interested in buying a home, contact Primary Residential Mortgage, Inc. We can help!

December 23, 2010 By cg_wsm Leave a Comment

An appraisal is a critical part of obtaining a mortgage. The reason for an appraisal is to get a professional estimate of the property that you are planning to purchase. An appraisal must be done in order to confirm the property’s value for the lender.

When an appraiser comes to inspect the property, they determine the value by looking at the:

Neighborhood: Does the property fit in with the rest of the neighborhood?

Property: Location, view, lot size, zoning, external factors, landscaping features, etc.

Architecture: Quality of construction and any defining characteristics.

Size: Addition and reduction improvements.

Condition: Age, deterioration, renovations, upgrades and added features.

Functional Utility: Is the property functional?

Health & Safety: Code compliance. Making sure all smoke detectors and carbon monoxide detectors are working properly.

Parking Features: Driveways, garages, carports, shops, etc.

Keep in mind that when the appraiser first approaches the house they take in consideration of the curb appeal, lot size and of course how well the property coordinates with the rest of the neighborhood.

As the appraiser enters your home, they look at the overall layout and design, condition, upgrades, special characteristics, square footage, functional utility, number of rooms, health and safety features.

All appraisals should be done by a qualified, licensed appraiser.

For more information on mortgage lending, contact Primary Residential Mortgage, Inc. Or visit us on Facebook at www.Facebook.com/TeamPrimary

Need Help? Call us at 860-785-9012

How to Buy and Sell a Fixer-Upper

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