by Paul Bianchina
If you're happy with your home and your neighborhood but are craving a little more space, maybe adding on is a better alternative to moving out. Room additions can be a terrific alternative for many homes, adding space for a growing family and adding resale value at the same time.
But be forewarned. A good room addition involves a whole lot more than just slapping on some additional square footage. Here are some important rules to keep in mind as your planning gets under way:
1. Know why you're adding on: This is the first rule, and it happens before you lift a hammer. Why do you need to add on? And no fair cheating and saying, "I need more space!"
Do you need another bathroom? Bedroom space? A laundry room or mud room? An improved kitchen flow? More space to entertain? Better accessibility due to health issues? More storage? A larger garage or hobby area? The only way the addition will meet your needs is to know what those needs are in the first place.
2. Good additions never look like additions: This is the other top rule of room-addition planning. When you're done, the addition -- no matter what its size or where it's located -- should never look like an addition. The architectural styles of new and existing need to blend.
The exterior materials need to blend as well, or at least complement each other. To the extent possible, use the same type of windows, roofing, doors, siding and other materials. If the original home has wood windows, using new vinyl windows in the addition screams "add-on" and lowers the appeal and the value. Don't overlook the need to blend landscaping and hardscaping as well.
3. Out, up, down, or a combination: The how and the where of a room addition is always a fun and exciting challenge for everyone involved. Some homes are situated on larger lots and lend themselves very nicely to adding out. Others seem best suited to adding up by building on a second or even a partial third floor.
Some houses are even laid out in such a way that it's possible to excavate under them and add new living space in the form of a daylight basement. Or it could be that a combination of two or even all three of these options makes the most sense for your particular home. Keep your mind open to the possibilities. Work with a good contractor and a good designer and you'll be amazed at what you can come up with.
4. Don't let the interior become an afterthought: I've seen a surprising number of additions that look great from the outside but seem to have no thought put into them on the inside. Flooring doesn't match. Trim doesn't match. Sometimes even the interior floor heights don't match. Remember that how the interior of your addition looks and flows on the inside is just as important as how it looks and flows on the outside. Use the same materials or the same style of materials. Match up ceiling, floor, and wall levels. Here again, no matter how you view the addition, inside or out, it should never look like an addition.
5. Create convenient access: This is another afterthought in a lot of additions. Let's say you have a three-bedroom, one-bathroom house, and you want to add a second bathroom. Typically, that's an addition that's going to have a good payback. But then you build the addition so that the only access to the second bathroom is through the kitchen. You now have a three-bedroom, two-bath house, but since the layout is lousy, you've actually gone backwards in terms of desirability and resale value.
Are you going to create a beautiful second-floor master suite that can be accessed only by a tiny spiral staircase from the family room? Is the only way into your great new kitchen via a convoluted hallway that leads through the laundry room?
When planning your addition, never lose sight of how you're going to access the new spaces, and make sure that access is both convenient and inviting.
6. Don't overwhelm your lot: Granted, room additions are expensive. So when you're doing one, and all those workers are onsite, there's a temptation to get as much square footage as you can. But don't cram your lot full of house. Remember that open space is important as well, both to you and your family, and, later on, to potential buyers.This is a good time to go back to Rule No. 1 and reconsider the "why" part of your room addition. Don't add space just to add it -- stay focused on your overall goals.
7. Understand the legalities: There are lots of rules and regulations that come into play regarding room additions. These include property line setbacks, zoning restrictions, and restrictions imposed by homeowner associations and architectural review committees.
In some historic areas, your addition may have to comply with certain historic guidelines. In other areas, there may even be solar shading restrictions that limit the height or the orientation of your roof line. Be sure you check into all of this before you get too far along with your planning.
Thursday, July 8, 2010
Wednesday, July 7, 2010
Home Refinancings Not As Numerous As Expected With Record Low Mortgage Rate
By STEVE BROWN / The Dallas Morning News
With 30-year home loan rates near 4.5 percent, refinancing is back in fashion.
But local mortgage reps say they are not seeing the flood of business they anticipated.
"You would think that the refi business would be blowing and going with interest rates at 50-year lows," said Billy Parker of Old Capital Residential Lending. "We are seeing a little upswing but not the massive amount of refi borrowers that we would expect at these interest rate levels."
The nationwide cost of an average 30-year home loan was 4.58 percent last week, according to mortgage giant Freddie Mac, which tracks mortgage rates. That's the lowest such rate the mortgage company has reported since it started business in the early 1970s.
The fall in home finance costs comes at a time when "the economy struggles to gain momentum and inflation remains very low," said Freddie Mac economist Frank Nothaft.
So with inflation and interest rates expected to rise, why aren't homeowners rushing to take advantage?
"What we are seeing is that the pool of homeowners who are credit-worthy and have stable jobs have already refinanced," Parker said. And some borrowers who would like to capitalize on the low mortgage rates can't because either they can't meet tougher underwriting standards or the values of their homes have declined. "I have lost at least six refi loans this year due to [low] appraisals," Parker said.
Despite obstacles, more consumers across the country are trying to refinance. Nationwide home loan refinance applications were up more than 12 percent in the week ending June 25 to the highest level since early 2009, the Mortgage Bankers Association reports.
At the same time, home purchase mortgage applications were down to near 13-year lows. But in North Texas, homebuyers now dominate the mortgage business, some lenders say. "Right now, I'm seeing refis at about 25 percent to 30 percent of all applications," said Mark Raskin, a senior loan officer for PrimeLending. "Our purchase business in Texas has not slowed down at all. "In fact, we are continuing to see an increase in purchase applications," Raskin said.
Many homeowners who have already locked into lower rates would have to see even further cuts before getting back into the loan market. "Actually, our refi orders are down significantly versus the strong first six months of last year, when lots of folks took advantage of rates between 4.75 percent and 5 percent for 30-year fixed," said Britt Fair, chief operating officer at Hexter-Fair Title Co.
"Most homeowners either don't qualify or already refinanced and don't want to incur the transaction costs for such a small rate improvement." Fair said "substantially higher" numbers of higher-priced homeowners are refinancing. A year ago, the cost spread on these "jumbo" loans was much higher, he said.
With 30-year home loan rates near 4.5 percent, refinancing is back in fashion.
But local mortgage reps say they are not seeing the flood of business they anticipated.
"You would think that the refi business would be blowing and going with interest rates at 50-year lows," said Billy Parker of Old Capital Residential Lending. "We are seeing a little upswing but not the massive amount of refi borrowers that we would expect at these interest rate levels."
The nationwide cost of an average 30-year home loan was 4.58 percent last week, according to mortgage giant Freddie Mac, which tracks mortgage rates. That's the lowest such rate the mortgage company has reported since it started business in the early 1970s.
The fall in home finance costs comes at a time when "the economy struggles to gain momentum and inflation remains very low," said Freddie Mac economist Frank Nothaft.
So with inflation and interest rates expected to rise, why aren't homeowners rushing to take advantage?
"What we are seeing is that the pool of homeowners who are credit-worthy and have stable jobs have already refinanced," Parker said. And some borrowers who would like to capitalize on the low mortgage rates can't because either they can't meet tougher underwriting standards or the values of their homes have declined. "I have lost at least six refi loans this year due to [low] appraisals," Parker said.
Despite obstacles, more consumers across the country are trying to refinance. Nationwide home loan refinance applications were up more than 12 percent in the week ending June 25 to the highest level since early 2009, the Mortgage Bankers Association reports.
At the same time, home purchase mortgage applications were down to near 13-year lows. But in North Texas, homebuyers now dominate the mortgage business, some lenders say. "Right now, I'm seeing refis at about 25 percent to 30 percent of all applications," said Mark Raskin, a senior loan officer for PrimeLending. "Our purchase business in Texas has not slowed down at all. "In fact, we are continuing to see an increase in purchase applications," Raskin said.
Many homeowners who have already locked into lower rates would have to see even further cuts before getting back into the loan market. "Actually, our refi orders are down significantly versus the strong first six months of last year, when lots of folks took advantage of rates between 4.75 percent and 5 percent for 30-year fixed," said Britt Fair, chief operating officer at Hexter-Fair Title Co.
"Most homeowners either don't qualify or already refinanced and don't want to incur the transaction costs for such a small rate improvement." Fair said "substantially higher" numbers of higher-priced homeowners are refinancing. A year ago, the cost spread on these "jumbo" loans was much higher, he said.
Tuesday, July 6, 2010
10 Home Repairs That Will Save You Money
by Claire Bradley
Remodels are great, but can get pretty pricey. Not everyone has thousands to add value to their home - but what about those less glamorous repair projects on your to-do list? These simple and inexpensive maintenance items don't seem like they add to your home's value, but they're big money-savers in the long run.
1. Caulk
If you've lived in your house a few years, you probably noticed that the caulk along your sinks, countertops and bathtub is coming loose. These gaps may not seem like a big deal, but they can wreak havoc inside your walls. Moisture causes mold and even leaks - expensive repairs that can easily be prevented. A tube of kitchen and bath caulk costs just a few dollars, and you'll avoid expensive repairs.
2. Insulate
The quickest way to save money on your energy bill is to insulate, yet so many of us overlook this simple home improvement project for its benefits. Sure, your walls are insulated, but what about your basement, your attic, and your garage? Just in case the energy cost savings aren't enticing enough for you, check with the IRS - there are current credits that allow you to deduct this energy-saving expense from your taxes.
3. Change Filters
When was the last time you changed your furnace's air filters? It's an oft-overlooked chore, but one that keep your furnace running efficiently, and improves the air quality inside your home. Change your filters at least every three months to keep your furnace working efficiently for years to come.
4. Install a Thermostat
Does your home have a programmable thermostat? If not, invest in one; it'll earn its money back in no time. By programming heating and cooling, you avoid paying to keep an empty house at a comfortable temperature. Manage the heat appropriately in winter to avoid burst water pipes; in summer, draw your curtains during the day to keep the house cool. Buy a programmable thermostat and you can save big on monthly bills.
5. Fix Leaks
That leaky faucet or runny toilet is draining your water bill, and in most cases it's a cheap and quick fix. Replace the washer on your faucet, and while you're at it, consider installing a faucet aerator if yours doesn't already have one. Faucet aerators reduce water flow from your faucet to save on your water bill; check your home improvement store for this inexpensive fix.
6. Install Dimmers
Dimmers aren't just for romance; they can save you big bucks on your energy bill. They're cheap and easy to install, so look for rooms that could use a little reduction in harsh lighting. While you're at it, replace your light bulbs with energy-efficient ones. They're big money savers.
7. Clean Carpets
Clean your carpet lately? With proper care, carpets can last a long time and look great, but everyone needs to clean them sometime. You don't need to hire an expensive service either - if you can vacuum, you can clean your carpets by yourself. Rent a carpet cleaner at your local supermarket or big-box store for a modest fee. Make sure you vacuum thoroughly before cleaning, and pick a dry day so your carpet dries quickly. With regular cleaning your carpet can last a long time, saving you big bucks on new flooring.
8. Clean Siding and Windows
Windows and siding get a beating in most climates. Wash your windows and siding with a simple hose and water first, and with a cleaning solution as needed; your home improvement store sells specialty products for just this kind of job. Rent a power washer for very dirty jobs. Keep an eye on cobwebs, wasp and bird nests to ensure your home's exterior stays in good shape. Touch up with paint as needed, and your house will look like new at little or no cost.
9. Fight Pests
Those spiders and ants at your foundation, that mouse nest in your crawl space? Take care of it - pests can destroy a home in a hurry. Hire an exterminator, or for small pests, combat with pesticides. Even if you don't think you have a problem, inspect every part of the interior and exterior of your home regularly to avoid small pest problems getting out hand.
10. Clean Ductwork
If your home is older, your ductwork likely has dust, grime, and other unwelcome residue inside. For big jobs, pay a professional; a simple cleaning can easily be done yourself. Simply remove the grates from your air vents, and clean the inside with your vacuum.
The Bottom Line
The best way to invest in your home is to take good care of what's already there. With these simple repair jobs, you'll even save money - with just a little elbow grease as investment.
Remodels are great, but can get pretty pricey. Not everyone has thousands to add value to their home - but what about those less glamorous repair projects on your to-do list? These simple and inexpensive maintenance items don't seem like they add to your home's value, but they're big money-savers in the long run.
1. Caulk
If you've lived in your house a few years, you probably noticed that the caulk along your sinks, countertops and bathtub is coming loose. These gaps may not seem like a big deal, but they can wreak havoc inside your walls. Moisture causes mold and even leaks - expensive repairs that can easily be prevented. A tube of kitchen and bath caulk costs just a few dollars, and you'll avoid expensive repairs.
2. Insulate
The quickest way to save money on your energy bill is to insulate, yet so many of us overlook this simple home improvement project for its benefits. Sure, your walls are insulated, but what about your basement, your attic, and your garage? Just in case the energy cost savings aren't enticing enough for you, check with the IRS - there are current credits that allow you to deduct this energy-saving expense from your taxes.
3. Change Filters
When was the last time you changed your furnace's air filters? It's an oft-overlooked chore, but one that keep your furnace running efficiently, and improves the air quality inside your home. Change your filters at least every three months to keep your furnace working efficiently for years to come.
4. Install a Thermostat
Does your home have a programmable thermostat? If not, invest in one; it'll earn its money back in no time. By programming heating and cooling, you avoid paying to keep an empty house at a comfortable temperature. Manage the heat appropriately in winter to avoid burst water pipes; in summer, draw your curtains during the day to keep the house cool. Buy a programmable thermostat and you can save big on monthly bills.
5. Fix Leaks
That leaky faucet or runny toilet is draining your water bill, and in most cases it's a cheap and quick fix. Replace the washer on your faucet, and while you're at it, consider installing a faucet aerator if yours doesn't already have one. Faucet aerators reduce water flow from your faucet to save on your water bill; check your home improvement store for this inexpensive fix.
6. Install Dimmers
Dimmers aren't just for romance; they can save you big bucks on your energy bill. They're cheap and easy to install, so look for rooms that could use a little reduction in harsh lighting. While you're at it, replace your light bulbs with energy-efficient ones. They're big money savers.
7. Clean Carpets
Clean your carpet lately? With proper care, carpets can last a long time and look great, but everyone needs to clean them sometime. You don't need to hire an expensive service either - if you can vacuum, you can clean your carpets by yourself. Rent a carpet cleaner at your local supermarket or big-box store for a modest fee. Make sure you vacuum thoroughly before cleaning, and pick a dry day so your carpet dries quickly. With regular cleaning your carpet can last a long time, saving you big bucks on new flooring.
8. Clean Siding and Windows
Windows and siding get a beating in most climates. Wash your windows and siding with a simple hose and water first, and with a cleaning solution as needed; your home improvement store sells specialty products for just this kind of job. Rent a power washer for very dirty jobs. Keep an eye on cobwebs, wasp and bird nests to ensure your home's exterior stays in good shape. Touch up with paint as needed, and your house will look like new at little or no cost.
9. Fight Pests
Those spiders and ants at your foundation, that mouse nest in your crawl space? Take care of it - pests can destroy a home in a hurry. Hire an exterminator, or for small pests, combat with pesticides. Even if you don't think you have a problem, inspect every part of the interior and exterior of your home regularly to avoid small pest problems getting out hand.
10. Clean Ductwork
If your home is older, your ductwork likely has dust, grime, and other unwelcome residue inside. For big jobs, pay a professional; a simple cleaning can easily be done yourself. Simply remove the grates from your air vents, and clean the inside with your vacuum.
The Bottom Line
The best way to invest in your home is to take good care of what's already there. With these simple repair jobs, you'll even save money - with just a little elbow grease as investment.
Monday, July 5, 2010
Tax Credit Deadline Extended; Flood Insurance Program Reinstated
Source: CCAR
Congress has passed a bill extending the Homebuyer Tax Credit closing deadline to September 30, 2010. The extension applies only to transactions that had ratified contracts in place as of April 30, 2010, and have not yet closed. There will be no gap between June 30 and the date the President signs the bill into law.
Additionally, Congress has extended the National Flood Insurance Program (NFIP) through September 30, 2010. This will allow transactions to move forward. The bill is retroactive and will cover the lapse period from June 1, 2010, to the date the law is enacted.
For additional information on both the tax credit deadline and the NFIP, visit Realtor.org/Government Affairs.
Congress has passed a bill extending the Homebuyer Tax Credit closing deadline to September 30, 2010. The extension applies only to transactions that had ratified contracts in place as of April 30, 2010, and have not yet closed. There will be no gap between June 30 and the date the President signs the bill into law.
Additionally, Congress has extended the National Flood Insurance Program (NFIP) through September 30, 2010. This will allow transactions to move forward. The bill is retroactive and will cover the lapse period from June 1, 2010, to the date the law is enacted.
For additional information on both the tax credit deadline and the NFIP, visit Realtor.org/Government Affairs.
Thursday, July 1, 2010
Foreclosures Account for 31% of Sales
Online foreclosure marketplace RealtyTrac reported today that homes in foreclosures accounted for 31 percent of the residential sales in the first quarter of 2010. The average sales price of these properties was nearly 27 percent below the average sales price of properties not in foreclosure.
RealtyTrac expects foreclosure discounts to stay between 25 percent and 30 percent as lenders steadily release foreclosures. The average price of foreclosed properties is $171,971.
Overall, foreclosures are down 14 percent in the first quarter compared to the fourth quarter of 2009. They are down 33 percent from the peak during the first quarter of 2009.
Source: RealtyTrac and Bloomberg, Dan Levy (06/30/2010)
RealtyTrac expects foreclosure discounts to stay between 25 percent and 30 percent as lenders steadily release foreclosures. The average price of foreclosed properties is $171,971.
Overall, foreclosures are down 14 percent in the first quarter compared to the fourth quarter of 2009. They are down 33 percent from the peak during the first quarter of 2009.
Source: RealtyTrac and Bloomberg, Dan Levy (06/30/2010)
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