Tag Archives: Property Value

Should I Buy an Older Home or a Newer Home?

The best answer to that question, of course, is, it depends!!!

Since I just received a similar question from one of my clients, I figured that I should put together some real-time numbers before answering.

Her question was, “How much more does a newer resale home cost than an older home?”

Graphic of homesSo, I looked up sales in the past 6 months for 3 bedroom, 2 bath homes that were built between 1987 and 1999 in the Laguna Creek neighborhood of Elk Grove, California.  A simple market analysis of these homes showed that the average home was about 1,448 square feet in size and that the average sales price was about $159,000.  Therefore, the average price per square foot was about $110.

Then, I looked up the sales in the past 6 months in the East Franklin neighborhood of Elk Grove, California. Only looking at 3 bedroom, 2 bath homes that were built between 2000 and 2007.  The average home in this neighborhood was about 1,692 square feet in size and the average sales price was $197,000. That amounts to an average cost per square foot of $116.

So, on the surface, the older home was about $6 per square foot cheaper, but was also much smaller.

Does that mean that I could tell her that the older home was a better buy?  Again, it depends.

Most of the homes built before 1991 in our communities had cedar shingle roofs.  Most of them are in need of replacement.  So, if you bought an older home with a shingle roof, you would need to consider the cost of a new roof when you compare these older homes with the newer homes that have tile roofs.  Generally, you are not going to replace a shingle roof with a tile roof because the older home was not engineered to handle the weight of a tile roof.  The alternative would be a standard composition shingle roof.  How much does it cost to replace the old shingles with a composition shingle roof?

I went online to the Service Magic site that provides the homeowner with estimators for such tasks. http://www.improvenet.com/HomeOwner/ProjectTools/index.html  Based on the the roofing estimator, depending upon the type of roof you were replacing and the quality of the roofing materials you were using, the cost could be somewhere between $5,000 and $10,000 to replace the roof.

Unfortunately, the older roof is not the only consideration.  What about paint and carpeting?  You may have that expense for the newer home, as well as the older home, but since the newer home is generally larger, the cost for paint and carpet will be higher in the newer home.

Also, the kitchen and bathroom may need updating in the older home.  And, last, but not least, you may need to consider replacing windows in the older home. That can add another $15,000 or more to the cost of upgrading the older home.

It seems like it is pretty easy to bring the cost of the older home up to the cost of the newer home if you do the roof, windows, kitchen and bathroom.  You still have an old heating and air conditioning system to deal with too.

Although the older home was an average of $42,000 cheaper than the cost of the newer home, was it the better investment or not?

If it’s a home that I am buying as a rental, then maybe I will lean towards the older home because I probably won’t do anything other than the roof and paint and carpet.  If I am going to live in it, then I will want to do it all and my overall cost will probably be about the same.

In the end, I guess it is all a matter of personal choice. Some people really like the look and feel of the older, more mature neighborhood. Some want the newer neighborhood.

With the above info, you should be in a position to make the best choice for you. And, when you are ready to move forward, give us a call at www.ElkGroveRealEstate.com, and we will be happy to answer your questions and help you experience the joy of home ownership.


Start building your memories,
as you turn your house into a home. 

As you might guess, this document is a compilation of information from our own efforts as REALTORS, as well as input from other REALTORS in our Coldwell Banker office.  I hope it has been of value to you.  Don’t hesitate to email us with any suggestions that will make this document better for you and your fellow homeowners!
Be sure to follow us on Facebook at www.Facebook.com/ElkGroveRealEstate.  For information about properties available for sale and for more information for buyers and sellers, please visit our website at www.ElkGroveRealEstate.com and don’t hesitate to give us a call or drop us an email with your questions.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE OR WEB SITE? You can, as long as you include this complete blurb with it: Jack & Tracey Edwards, your real estate advocates, specialize in helping buyers and sellers in Elk Grove, CA,  and the greater Sacramento area.   Get information about available homes online at:  www.ElkGroveRealEstate.comOur mobile clients can find us at Mobile.ElkGroveRealEstate.com

 

PMI Tax Deductibility Expires December 31, 1012

If the increase in the upfront PMI and the increase in the monthly PMI for FHA buyers, wasn’t bad enough, it looks like these homeowners will also lose the tax deduction for these costs at the end of the year.

What does  the expiration of the Tax Relief and Health Care Act of 2006 mean to the home buyer or the home seller?

That means that the cost of home ownership will increase with for many because approximately  70% of all 1st time buyer use FHA loans. And when the cost of home ownership rises, there will be fewer buyers, and those remaining, will have to purchase lower priced properties because their purchasing power will decrease. That means that the sellers will get less for their houses.

It’s just this simple.  Here’s how the upcoming changes will affect your clients

For example, if a buyer is buying a home for about $311,000 the loan amount will be about $300,000 with the minimum 3.5% down.  The estimated monthly payment will be about $2146. (That would be a 30 year loan at 4%)

The mortgage insurance premium is approx. $320.

In California; a married couple with an adjusted gross income of $100,000 are typically in a 45% federal and state marginal tax bracket.

The loss of the PMI deductibility translates into a payment increase of $135 a month…or in other words a defacto 8.5% (after tax dollars) net increase in house payment.

This is not what our recovering housing market needs!!!!!!!!

If I were a home buyer, or even a home seller, I would be talking with my legislators and asking them to extend the tax deductibility of the Tax Relief and Health Care Act of 2006.

The following committees will have input to extending the life of the 2006 legislation.  The number in parenthesis indicates the number of California legislators on those committees.

House Committee on Ways and Means (5)

House Committee on Financial Services (7)

House Committee on the Budget (4)

At this time neither of our two Senators sit on committees that can influence this legislation on the committee level…but given their seniority in the Senate..it would be helpful to contact their offices as well.

Senator Barbara Boxer

Senator Diana Feinstein

Start building your memories,
as you turn your house into a home. 

As you might guess, this document is a compilation of information from our own efforts as REALTORS, as well as input from other REALTORS in our Coldwell Banker office.  I hope it has been of value to you.  Don’t hesitate to email us with any suggestions that will make this document better for you and your fellow homeowners!
Be sure to follow us on Facebook at www.Facebook.com/ElkGroveRealEstate.  For information about properties available for sale and for more information for buyers and sellers, please visit our website at www.ElkGroveRealEstate.com and don’t hesitate to give us a call or drop us an email with your questions.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE OR WEB SITE? You can, as long as you include this complete blurb with it: Jack & Tracey Edwards, your real estate advocates, specialize in helping buyers and sellers in Elk Grove, CA,  and the greater Sacramento area.   Get information about available homes online at:  www.ElkGroveRealEstate.comOur mobile clients can find us at Mobile.ElkGroveRealEstate.com

 

Selling Your Home In Today’s Market

SFSellingTodaysMarket

This article was written and provided by Kris Vogt, President, Coldwell Banker Sacramento-Lake Tahoe Region

As the Sacramento area’s housing market continues to bounce back from the recession, more and more buyers have decided they can’t wait any longer – now is the time to get back into the market to find their next home.

While the real estate market still has its challenges, things are very different today than they were in 2009, 2010 and even early last year. Buyers are generally more optimistic about the future, ready to purchase, much better qualified for a loan and, in many cases, are paying big down payments or even all cash for their next home.

Indeed, the scales of supply and demand are once again moving back in the direction of home sellers after being out of balance for several years. While countless buyers are out there pounding the pavement for a home, the problem now is that there just aren’t enough sellers to meet the demand in many communities.

As the economy continues to improve and with a shortage of attractive properties in good neighborhoods, buyers are once again paying good prices for properties rather than simply looking for distressed homes at bargain basement prices. And in some cases, properties are even getting multiple offers, driving up the sale price above the asking price, as a recent San Jose Mercury Newsstory discussed.

So if you’ve been thinking about selling your home, now may be an ideal time to do so while buyers are eager, interest rates are still low and there isn’t as much competition from other sellers as there usually is this time of year. Here are several suggestions on how to get started and the best way to get top dollar for your home in today’s market.

  • Pick the best agent for the job. Selling a home is never easy, but in today’s complex real estate market it’s particularly challenging. So it’s more important than ever to find an experienced professional Realtor to help you get the job done. This is no time for amateurs. Start by interviewing several agents to see who has a proven track record of successfully marketing properties in your area. Ask them about their marketing plan, including print media, social media and online marketing via major real estate websites. Find out how well networked they and their brokerage are to other agents with potential buyers. Do they have offices beyond your city limits and even outside the state? Today’s buyers are just as likely to be relocating from across the country as they are from across town.
  • Go online and be visual. Remember the days of sticking a sign in the front lawn and taking out an ad in the local paper? Those days are long gone. Nearly 90 percent of buyers start their search for a home online, according to the National Association of Realtors. So you must be there in a big way to compete for the attention of buyers. Work with your agent to put up lots of high-resolution photos and as much information as possible. Make sure to show photos of all the major areas of your home and yard to give buyers as much of a sense of being there as possible. If not, buyers may wonder what you’re hiding. And strongly consider using video and virtual tours. Such marketing tools are no longer just for luxury homes.
  • Price your home competitively for today’s market. Just because a house comparable to yours sold for a certain price before the recession doesn’t mean you will be able to get the same price today. A lot has changed since then. And while prices are firming up, it’s still important to realize the new realities of today’s market. Talk with your Realtor to determine the appropriate, competitive listing price for your home based on current market conditions. You may even choose to have an appraisal done in advance of setting the price. Remember that in this market, homes that are priced aggressively attract the most buyers and – in some cases – multiple offers that push your final sale price even higher.
  • De-clutter and de-personalize. De-personalizing and de-cluttering a home before putting it on the market can help make it easier for buyers to imagine themselves living there – a crucial step in the selling process. Take down family portraits, personal collections and knickknacks. Homebuyers are looking for a home they can picture their family living in, not yours. Removing these items will also eliminate clutter and ensure that people are looking at the house itself, not at the photos from your last family vacation.
  • Update, freshen up. Keeping in mind that some buyers take move-in condition to be important, put your home in its best light. Possibilities include replacing outdated kitchen and bathroom fixtures, applying a fresh coat of paint and/or refinishing the kitchen cabinets. Replace worn carpet or fix broken tiles. Many cosmetic touches are surprisingly affordable but may yield much higher sale prices. The less work buyers have to do when they move in, the faster they may be willing to make an offer.
  • Conduct a full home inspection. If a professional home inspector determines that there are negative issues with the home, consider repairing the problems before buyers show up at your door. Potential buyers will cast an extremely critical eye over your home if it needs too many repairs – especially if they are trying to decide between your home and another one without problems. Be sure to have the home inspection report available for prospective buyers along with an itemizing all of the repairs that have been made and the associated cost for each to demonstrate the investment you’ve made in your home.
  • Make your home and yard picture perfect. As the old saying goes, you only get one chance to make a good first impression. When a buyer sees your house for the first time, a positive impression can make or break the sale. You can maximize curb appeal by trimming trees, planting flowers and even rolling out a new lawn if needed. A fresh exterior coat of paint might also prove valuable. And consider having a professional “stage” your home to make it even more attractive for buyers by rearranging what you have and/or bringing in other furnishings and accessories.
  • Be patient and flexible. You’ve done all the right things to put your home in the best position to sell. But there will undoubtedly be bumps along the way. A buyer may have difficultly securing financing. The appraisal may come in lower than expected. The escrow period could drag on longer than you thought before the deal closes. It’s not unusual to have occasional issues pop up. After all, buying a home is the single biggest financial transaction most of us will ever make in our lives. Through it all, remember that your Realtor is there by your side. He or she will be there with you every step along the way, managing the tough issues so you don’t have to and helping you achieve all of your home selling goals in today’s market.
ColdwellBanker3d3cweb

Start building your memories,
as you turn your house into a home. 

As you might guess, this document is a compilation of information from our own efforts as REALTORS, as well as input from other REALTORS in our Coldwell Banker office.  I hope it has been of value to you.  Don’t hesitate to email us with any suggestions that will make this document better for you and your fellow homeowners!
Be sure to follow us on Facebook at www.Facebook.com/ElkGroveRealEstate.  For information about properties available for sale and for more information for buyers and sellers, please visit our website at www.ElkGroveRealEstate.com and don’t hesitate to give us a call or drop us an email with your questions.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE OR WEB SITE? You can, as long as you include this complete blurb with it: Jack & Tracey Edwards, your real estate advocates, specialize in helping buyers and sellers in Elk Grove, CA,  and the greater Sacramento area.   Get information about available homes online at:  www.ElkGroveRealEstate.com.

 

Coldwell Banker Realty Check — March 2012

SFSellingTodaysMarket

As the Sacramento area’s housing market continues to bounce back from the recession, more and more buyers have decided they can’t wait any longer – now is the time to get back into the market to find their next home.

While the real estate market still has its challenges, things are very different today than they were in 2009, 2010 and even early last year. Buyers are generally more optimistic about the future, ready to purchase, much better qualified for a loan and, in many cases, are paying big down payments or even all cash for their next home.

Indeed, the scales of supply and demand are once again moving back in the direction of home sellers after being out of balance for several years. While countless buyers are out there pounding the pavement for a home, the problem now is that there just aren’t enough sellers to meet the demand in many communities.

As the economy continues to improve and with a shortage of attractive properties in good neighborhoods, buyers are once again paying good prices for properties rather than simply looking for distressed homes at bargain basement prices. And in some cases, properties are even getting multiple offers, driving up the sale price above the asking price.

So if you’ve been thinking about selling your home, now may be an ideal time to do so while buyers are eager, interest rates are still low and there isn’t as much competition from other sellers as there usually is this time of year. Here are several suggestions on how to get started and the best way to get top dollar for your home in today’s market.

  • Pick the best agent for the job. Selling a home is never easy, but in today’s complex real estate market it’s particularly challenging. So it’s more important than ever to find an experienced professional Realtor to help you get the job done. This is no time for amateurs. Start by interviewing several agents to see who has a proven track record of successfully marketing properties in your area. Ask them about their marketing plan, including print media, social media and online marketing via major real estate websites. Find out how well networked they and their brokerage are to other agents with potential buyers. Do they have offices beyond your city limits and even outside the state? Today’s buyers are just as likely to be relocating from across the country as they are from across town.
  • Go online and be visual. Remember the days of sticking a sign in the front lawn and taking out an ad in the local paper? Those days are long gone. Nearly 90 percent of buyers start their search for a home online, according to the National Association of Realtors. So you must be there in a big way to compete for the attention of buyers. Work with your agent to put up lots of high-resolution photos and as much information as possible. Make sure to show photos of all the major areas of your home and yard to give buyers as much of a sense of being there as possible. If not, buyers may wonder what you’re hiding. And strongly consider using video and virtual tours. Such marketing tools are no longer just for luxury homes.
  • Price your home competitively for today’s market. Just because a house comparable to yours sold for a certain price before the recession doesn’t mean you will be able to get the same price today. A lot has changed since then. And while prices are firming up, it’s still important to realize the new realities of today’s market. Talk with your Realtor to determine the appropriate, competitive listing price for your home based on current market conditions. You may even choose to have an appraisal done in advance of setting the price. Remember that in this market, homes that are priced aggressively attract the most buyers and – in some cases – multiple offers that push your final sale price even higher.
  • De-clutter and de-personalize. De-personalizing and de-cluttering a home before putting it on the market can help make it easier for buyers to imagine themselves living there – a crucial step in the selling process. Take down family portraits, personal collections and knickknacks. Homebuyers are looking for a home they can picture their family living in, not yours. Removing these items will also eliminate clutter and ensure that people are looking at the house itself, not at the photos from your last family vacation.
  • Update, freshen up. Keeping in mind that some buyers take move-in condition to be important, put your home in its best light. Possibilities include replacing outdated kitchen and bathroom fixtures, applying a fresh coat of paint and/or refinishing the kitchen cabinets. Replace worn carpet or fix broken tiles. Many cosmetic touches are surprisingly affordable but may yield much higher sale prices. The less work buyers have to do when they move in, the faster they may be willing to make an offer.
  • Conduct a full home inspection. If a professional home inspector determines that there are negative issues with the home, consider repairing the problems before buyers show up at your door. Potential buyers will cast an extremely critical eye over your home if it needs too many repairs – especially if they are trying to decide between your home and another one without problems. Be sure to have the home inspection report available for prospective buyers along with an itemizing all of the repairs that have been made and the associated cost for each to demonstrate the investment you’ve made in your home.
  • Make your home and yard picture perfect. As the old saying goes, you only get one chance to make a good first impression. When a buyer sees your house for the first time, a positive impression can make or break the sale. You can maximize curb appeal by trimming trees, planting flowers and even rolling out a new lawn if needed. A fresh exterior coat of paint might also prove valuable. And consider having a professional “stage” your home to make it even more attractive for buyers by rearranging what you have and/or bringing in other furnishings and accessories.
  • Be patient and flexible. You’ve done all the right things to put your home in the best position to sell. But there will undoubtedly be bumps along the way. A buyer may have difficultly securing financing. The appraisal may come in lower than expected. The escrow period could drag on longer than you thought before the deal closes. It’s not unusual to have occasional issues pop up. After all, buying a home is the single biggest financial transaction most of us will ever make in our lives. Through it all, remember that your Realtor is there by your side. He or she will be there with you every step along the way, managing the tough issues so you don’t have to and helping you achieve all of your home selling goals in today’s market.

Start building your memories,
as you turn your house into a home. 

As you might guess, this document is a compilation of information from our own efforts as REALTORS, as well as input from other REALTORS in our Coldwell Banker office.  I hope it has been of value to you.  Don’t hesitate to email us with any suggestions that will make this document better for you and your fellow homeowners!
Be sure to follow us on Facebook at www.Facebook.com/ElkGroveRealEstate.  For information about properties available for sale and for more information for buyers and sellers, please visit our website at www.ElkGroveRealEstate.com and don’t hesitate to give us a call or drop us an email with your questions.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE OR WEB SITE? You can, as long as you include this complete blurb with it: Jack & Tracey Edwards, your real estate advocates, specialize in helping buyers and sellers in Elk Grove, CA,  and the greater Sacramento area.   Get information about available homes online at:  www.ElkGroveRealEstate.comOur mobile clients can find us at Mobile.ElkGroveRealEstate.com

 

Coldwell Banker Realty Check — February 2012

JobandEconomy

From Kris Vogt, President, Coldwell Banker Sacramento/Lake Tahoe

With 2012 well underway, there are very encouraging signs that the nation’s economy and job market are finally starting to gain momentum. If this trend continues in the months ahead, it bodes well for the recovery in housing – both here in Northern California and around the country.The U.S. economy grew at a 2.8 percent annual rate in the final quarter of last year, according to figures released by the federal government this month. This level was a sharp increase from the third quarter’s 1.8 percent rate. And there are indications that the latest GDP figure could actually be revised higher due to wholesale inventories rising in December.

Even more encouraging for real estate is the fact that the labor market is steadily improving. Most analysts agree that in order to have a self-sustaining recovery in the housing market we must first have a significant turnaround in the job market. There are indications that could be happening at long last.

Initial weekly unemployment claims fell 15,000 to 358,000 in a new report by the Labor Department. An even better trend gauge — the four-week average — fell to its lowest level since April 2008, the period before the financial crisis. And the unemployment rate has fallen to a three-year low of 8.3 percent.

One other bullish indicator for the housing market is solid gains in the stock market, especially in the housing sector. The S&P index is up more than 7 percent so far this year (as of February 10) and up more than 16 percent since late November.

No one can predict, of course, where stocks go from here and it’s not unreasonable to assume they could continue to bounce around given the sovereign debt crisis in Europe. But the stock market gains certainly are helping all of our 401k portfolios and perhaps bolstering the confidence of potential homebuyers.

The housing industry has fared better than many stocks on Wall Street. While housing starts are expected to climb 15-20 percent this year, the stock prices for homebuilders themselves have spiked from 20 percent to as much as 134 percent since August, according to a recent story in USA Today.

“Talk is turning from when housing will hit bottom to whether it’s time to buy housing stocks and count on the sector to propel the economy again,” the USA Today said in its February 9 article Home builders and investors both see signs of a turn.

To be sure, the nation’s housing market is still facing a number of challenges, as USA Today pointed out, from tight credit to glut of bank owned properties in many markets. And the recent $25 billion settlement by the nation’s biggest mortgage banks could spur more foreclosures in the near term.

In a speech before the National Association of Home Builders, Federal Reserve Chairman Ben Bernanke cautioned that, “We need to continue to develop and implement policies that will help the housing sector get back on its feet.”

Bernanke argued that overly tight credit in mortgage markets could be holding back a strong rebound in the real estate sector. He called on lenders and regulators to look at rules and practices that may hold back the origination of sound mortgages. He also has championed a plan to convert foreclosed homes into rentals.

But despite the challenges, there is good reason to believe the housing market is gradually turning the corner in many areas.

For most of the country, the inventory of homes for sale actually is falling while sales volumes have been picking up since last year. And affordability levels for homeownership have never been better, thanks to historically low interest rates and attractive home pricing.

We’ve seen the improvement right here in Northern California. According to a new report by the California Association of Realtors, January home sales rose 4.4 percent in the Bay Area when compared with the figures from last year. There was a 10.6 percent increase in Santa Cruz County, a 4 percent increase in Sacramento County and a 3.5 percent increase in Placer County. Prices did ease 8.2 percent in Monterey County.

We continue to see growing demand by very serious buyers looking to purchase homes. And while some are scouring the landscape for bargain basement distressed properties, many are seeking good homes at fair prices. And there continues to be a very strong demand for properties in the middle and upper ends of the market, too.

The real problem we’re facing here in the Northern California isn’t a lack of buyers; it’s not enough sellers.

Many homeowners who would like to sell their homes have been sitting on the sidelines, still wrongly believing that the market is in the depths of a recession. They still fear that they will have to take drastic price cuts in order to sell. I’m afraid that the news hasn’t gotten out to them that things have changed for the better over the past year or two.

Sellers no longer must sell their properties at fire-sale prices to get buyers’ attention. In fact, fairly priced homes that are staged well and located in desirable neighborhoods are not only being sold relatively quickly these days, but in some cases with multiple offers.

So if you’ve been thinking about buying or selling a home, there may not be a better time than right now. For buyers, mortgage interest rates are still below 4 percent for many 30-year fixed-rate loans and pricing is attractive in many neighborhoods. For sellers, there are scores of well-qualified buyers ready to purchase your home at reasonable prices.

No one knows what the future holds, but as the economy and the job market continue to gain momentum, there’s every reason to believe that the housing market will follow suit as well. A professional Realtor can help you decide if now is the right time for you to market your property or to find the next home of your dreams.

Start building your memories,
as you turn your house into a home. 

This article was not written by Jack Edwards, as this blog notes automatically at the top of the page. I cannot change the automatic notation at the top which is created by WordPress.  The article was written by Kris Vogt, President of Coldwell Banker Sacramento/Lake Tahoe.  I hope it has been of value to you.  Don’t hesitate to email us with any suggestions that will make this document better for you and your fellow homeowners!
Be sure to follow us on Facebook at www.Facebook.com/ElkGroveRealEstate.  For information about properties available for sale and for more information for buyers and sellers, please visit our website at www.ElkGroveRealEstate.com and don’t hesitate to give us a call or drop us an email with your questions.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE OR WEB SITE? You can, as long as you include this complete blurb with it: Jack & Tracey Edwards, your real estate advocates, specialize in helping buyers and sellers in Elk Grove, CA,  and the greater Sacramento area.   Get information about available homes online at:  www.ElkGroveRealEstate.com.