Tuesday, August 25, 2009

Great Weekend Projects For Your Home


August 25, 2009---
I've heard many times, "We should have done this a long time ago." Usually this is some large project that sellers have put off year after year, living with their home as it is versus updating it to what they have wanted. Maybe it's just simple projects such as faux painting a bathroom, taking down wallpaper, or even changing the hardware of cabinetry. Stop procrastinating! Go ahead and paint the bedroom & take down that 60's wallpaper, update the linoleum to tile, re-paint the kitchen cabinets, tear down that wall & make your family room larger; whatever your project is you are much better off to allocate the funds needed and complete it.

Don't just talk about how you "want to do this" and "need to do that", but never get it completed. Make the decision to do these projects within your budget. It's best to do the projects you want starting from the date you move in. Make a "To Do" list and write a due date beside it for when this project needs to be completed, so you are more likely to actually finish them.

Moving in One Year:
1. Get a market analysis on your home to see what it is worth based on all aspects of the buying public. Many agents will work up a competitive market analysis for you at no cost. *Make sure to ask!
2. See what you owe on your home.
3. Estimate or get prices for the cost of your updates. (Working on yourself or a hiring?)
4. Decide which, if not all, updates can be completed.
5. Enjoy! Love your house before you leave it.

Moving in 5-10 Years:
1. Decide which projects are best long-term and will add the most value to your home.
2. Make a timeline of the projects that are "This Year" and those "Next Year".
3. Enjoy!

Best Low Cost Home Improvements:
1. Painting
The color of a room can drastically change it's overall appearance
2. Hardware
Cabinet pulls, door knobs, etc.
3. Window Treatments
Change out the old or dark colored curtains/ new blinds
4. Wallpaper
Take it down!
5. Appliances
Order new doors or face panels from the manufacturer so they match
6. Vinyl Floor
Put easy-to-apply vinyl tile directly over old flooring
7. Light Fixtures
Change out that old brass with an up-to-date style
8. Organize
Clean out & store neatly. Go through it ALL! Have a "Keep", "Toss" & "Donate" pile. Store the "Keep" items nicely in wicker baskets & bins.
9. Garden
Clean up the landscaping. Buy some perennials that will grow year after year. Draw out your design & color scheme prior to purchasing any plants. Make sure to note areas of shade & sun!

Best Rooms to Remodel:
1. Kitchen
It can be costly, but an updated kitchen is attractive to all buyers. New cabinets, new floors, or a complete re-design are always a plus.
2. Bathroom
No one wants a teeny tiny bathroom or shower. Update the sink, mirror & lighting fixtures or even tear down the wall to make it larger. Maximize space!
3. Master Bedroom/Bathroom
Most people want their home to be a place of relaxation. A coat of paint, new carpet, new walk-in rain shower, or even added windows & lighting in the bath can make a big difference in the atmosphere. We all want to come home to a spa!

The easiest way to decide if you should remodel a certain room or not, is to think about it objectively. Ask yourself these questions:
1. Would it improve the look of my home when I sell?
2. Is it appealing to the vast majority of the public?
3. Is it too trendy to the times?
4. Does it help the home function better?
5. Does this make my home too "built up" as compared to those around me?

Feeling inspired? Go to Lowe's and sign up for weekend classes to do the work on your own, talk to friends, watch HGTV, decide what to fix up and then get it completed.

Good Luck!

Melissa Simms
RE/MAX Associates- Louisville, KY

Thursday, August 13, 2009

First-Time Home Buyers Tax Credit


August 13, 2009---- Now that summer has flown by, we are at the end of August believe it or not. Before too long pools will be closed, trees will be changing colors and first-time home buyers looking to take advantage of the $8,000 tax credit will be out of luck.

The $8,000 tax credit being offered to first-time home buyers and people who have not owned a home within the last three years WILL RUN OUT. Like the saying goes, "All good things must come to an end". The end for the tax credit is December 1, 2009. Sounds like plenty of time, right? Wrong! Being at the end of August as we are now, if someone was to get out and start looking right NOW......say they find "THE HOME" in a month, put in an offer and negotiate with the sellers until acceptance, we are looking at about a month and a half. After the offer is accepted, it takes approximately 40 to 50 days to get all contingency's cleared up in the contract and give the loan officer enough time to complete the paperwork for the loan before all parties can meet at the closing table. So, with my example situation, the closing day would be mid-November.

Basic Tax Credit Facts
1. The home must be closed on PRIOR TO December 1, 2009.
2. Eligible if you have not owned a home in the past three years or are a first-time home buyer.
3. Does NOT have to be re-paid.
4. Single tax payers making $75,000 or less
5. Married tax payers making $150,000 or less
6. If taxes are owed to the IRS, that amount will be deducted from the $8,000 credit and the difference paid to you
7. Tax credit EQUAL to 10% of the homes purchase price up to $8,000

Purchase Price: $150,000 Tax Credit Amount: $8,000
Purchase Price: $100,000 Tax Credit Amount: $8,000
Purchase Price: $95.000 Tax Credit Amount: $8,000
Purchase Price: $80,000 Tax Credit Amount: $8,000
Purchase Price: $72,000 Tax Credit Amount: $7,200
Purchase Price: $68,000 Tax Credit Amount: $6,800
For more details on the tax credit and to determine if you are eligible, check out: http://www.federalhousingtaxcredit.com/.

I can't stress enough for those that are in fact eligible and thinking of buying a house to look into this opportunity. It's never happened in our past and is not likely to happen again in our future.

Maybe I Should Still Rent......
Who really want to pay rent?! Real estate always has been and always will be a great investment over time. Instead of paying $800 in rent a month to pay off someone else's property you could be paying about the same to pay off YOUR own property.

I have shown buyers what they are paying out in rent versus the equity they could be building if they owned. I'd say all that I have shown this too are shocked at the amount of money they are putting into someone else's pocket.

$800/month with a rent increase of 2%/year
Year 5: $9,600.00+
Year 10: $49,950.00+
Year 30: $389,000.00+

Purchase Price: $135,000
Mortgage Amount: $130,000
Mortgage Rate: 6% fixed/30 years
Appreciation Rate: 2% (Louisville rates averaging around 5.5%/year)
Priciple & Interest Payment on above: $780.00
Year 5:
Mortgage paid down to $120,971
Home appreciated to around $149,051
Year 10:
Mortgage paid down to $108,791
Home appreciated to around $164,564
Year 30:
Mortgage paid off
Home appreciated to around $244,534

So.....Would you rather pay someone else $389,000+ for a roof over your head OR would you rather get paid $244,534+ to have owned a home?

Regardless of what the economy is doing in the short term, real estate is ALWAYS a great investment.

Melissa Simms
RE/MAX Associates- Louisville, KY