Thursday, December 15, 2011

Best Bet Home Improvements

Are you considering making some improvements to your home before listing it for sale?  Here is what you need to know before you begin any costly project.  The reality is just because you spend $25,000 remodeling your home, does not mean your home is worth $25,000 more.  The return on investment (ROI) when remodeling a home will depend on the following factors:


  • The current housing market trends.
  • Value of the other homes in your neighborhood.
  • When you plan to sell.
  • Exact nature of the improvement.

Also, it is important to understand that the longer you live in your home after a remodel, the less ROI you will realize.  The following is a list of improvements that pay off, as well as those that don’t.

Painting:  If you plan to sell within the next year or two, a fresh coat of neutral toned paint could facilitate the transaction.  A professional exterior paint job may also recoup up to 75% of its cost.

Kitchen Remodels:  A few basic kitchen improvements can be one of the best ways to go.  New paint and flooring are always a plus as well as sanding, staining or painting worn looking cabinets.  Replacing old cabinet hardware is also a very low cost improvement that makes a big difference in appearance.  According to Remodeling Magazine, a full kitchen remodel recouped 80% of its cost and a more moderate remodel was valued at 87%.

Area Conversions:  Generally speaking, increasing the functional space of your home holds its value longer than simply remodeling to make a house look better.  Furthermore, area conversions are typically far less expensive than adding an addition.  According to Remodeling Magazine, turning your basement into an extra living space costs (on average) about $40,000 with an average ROI of about 69%.

Adding a Bathroom:  The addition of an extra bathroom is definitely one of the better improvements you can make to your home.  At an average cost of $14,200, a new full bathroom can recoup 81% of its total cost.

Adding a Deck:  The addition of a deck is one of the most cost effective ways to add square footage to your home and will generally recoup 75% of their costs.  Compared to other outdoor improvements (except painting) this is one of the best.

New Windows:  Often times the utility bill savings will compensate for the iffy resale value.  Assuming you have standard windows (not custom shapes and sizes) a good quality replacement should realize about 68% ROI.

Gardens and Fences:  Typically they look nice but, buyers don’t pay for them.  Unless a buyer is an avid gardener or landscaper, they will not want to have to maintain gardens and fences.

Swimming Pools:  Just don’t do it!  Swimming pools are expensive to maintain and create fear of accidents and liability.  Furthermore, a swimming pool will have little to no resale value.

It is important to remember to make sure your home is in good condition before diving into any remodel.  A buyer will not be impressed by your new bathroom if you have a leaky roof.  Also, keep your remodels basic so you appeal to a wide array of buyers.  Lastly, if you want to know how to get the ROI over 100% on you next remodel, please contact me at the information below.

All the best,


Tyler MacGuire  e-PRO®, SFR
Broker Associate
Omni Real Estate Company
Office: 970-468-2740 begin_of_the_skype_highlighting            970-468-2740      end_of_the_skype_highlighting begin_of_the_skype_highlighting            970-468-2740 begin_of_the_skype_highlighting            970-468-2740      end_of_the_skype_highlighting      end_of_the_skype_highlighting
Mobile: 970-409-7779 begin_of_the_skype_highlighting            970-409-7779      end_of_the_skype_highlighting begin_of_the_skype_highlighting            970-409-7779 begin_of_the_skype_highlighting            970-409-7779      end_of_the_skype_highlighting      end_of_the_skype_highlighting    


       

Wednesday, December 7, 2011

In Defense of HOA’s

More than once I have been told by a buyer that they don’t want to look at any properties that are part of a Home Owners Association.  When asked for more information the most common answer I hear is “it’s too much money every month that is not going toward the principal on my mortgage.”
           
At first glance a $350 a month HOA payment in addition to your principal, interest, real estate taxes and insurance costs may seem like a lot.  However, it is important to understand what you are getting in return for that money.  Here in Summit County, CO the most common HOA inclusions are Cable TV, water, sewer, trash pick up, snow removal and common area maintenance (this may include a common hot tub or club house).  Admittedly, you can probably get cable, water, sewer, snow removal and trash pick up for less than $350 a month but, you will have many separate bills to pay so there is a convenience factor.  More importantly though, a portion of your monthly HOA payment is going to be put into the HOA’s reserve account.  Down the road when the building needs repair it will be paid for from this reserve account.  If you do not have an HOA you will be solely responsible for any expenses and if you haven’t been saving for it, you could be in real trouble.  Lastly, imagine the worst case scenario of a catastrophic roof problem that causes more expenses than what is in your HOA’s reserve account.  Without an HOA you would be solely responsible for the difference but with an HOA, that amount gets divided by all the members of the association which could save you thousands.

All of this being said, it is very important that you take a look at the HOA’s financial statements before purchasing a property in any association.  If the HOA is weak financially, it could lead to all sorts of unforeseen costs typically in the form of the dreaded special assessments.  Nevertheless, a strong, well run HOA can take away many of the worries associated with home ownership and provide financial security.

As always, if you have any questions about this or anything else pertaining to Summit County Real Estate, please feel free to contact me anytime at the information below.

All the best,

Tyler MacGuire  e-PRO®
Broker Associate
Omni Real Estate Company
Office: 970-468-2740
Mobile: 970-409-7779    

       

“Your Guide to Summit County Real Estate 

Wednesday, November 30, 2011

Is a Short Sale a Foreclosure?

The question was recently asked of me what the difference between a short sale and a foreclosure is.  Since I assume most people have a general understanding of what a foreclosure is, I will focus on explaining what exactly a short sale is.

The short sale addendum defines a short sale as “a transaction in which any Lien Holder releases it’s lien against the property and (a) accepts an amount less than the full amount Lien Holder claims is owed or (b) treats the debt secured by the Lien differently than as originally provided for in the evidence of debt (such as a promissory note).  Ok now in simple English, a short sale is an alternative to a foreclosure that may be less detrimental to the homeowner.

Let’s say John Smith bought a home at the height of the real estate market and today he is upside down on it (owes more than it’s worth).  Now if John like many Americans falls on tough financial times, he may no longer be able to afford his monthly mortgage payment.  Furthermore, John may not be able to afford to sell his home for less than the loan amount and bring the difference to closing to pay back the lender.  However, if John can document his inability to repay the loan, with the help of his Realtor® he may be able to negotiate a short sale with the Lien Holder.  In the short sale, the Lien Holder would agree to accept an amount less than what is actually owed, there by making it possible for John to sell the home without it being foreclosed upon.

It is important to understand however, that short sales are by no means the perfect solution.  Sometimes the Lien Holder does not agree to release the Seller from the unpaid portion of the debt and the Seller may remain liable for the debt after closing.  There for, as I said in the beginning, a short sale is an “alternative” to foreclosure not a solution or fix all.

If you have any questions about this or think you may need to try to negotiate a short sale with your Lien Holder, please feel free to contact me anytime.  You can also find lots more information on Summit County Real Estate on my web site
                                            
All the best,

Tyler MacGuire  e-PRO® SFR
Broker Associate
Omni Real Estate Company
Office: 970-468-2740
Mobile: 970-409-7779    

       



“Your Guide to Summit County Real Estate” 

Tuesday, November 15, 2011

Should I Be Talking With a Lender?

Often, buyers will ask me at what point in the buying process they need to sit down with a lender.  Furthermore, many times buyers are apprehensive about speaking with a lender as the will have to disclose all of their financial history including income, debts and their credit scores.  However, it is to the buyer's benefit to get a lender involved in the home buying process as early as possible…and by early, I mean as soon as you start considering purchasing a home.

By sitting down with a lender you can get pre qualified for a loan.  The prequalification process consists of answering the lenders questions about your income, debts and credit scores.  Once the lender has this information they can estimate not only how much house you can afford but, how much your monthly payments will be at different price points.  As a buyer this information is very important as it will dictate what properties you look at and ensure that you are not wasting time looking at properties that you either cannot afford or, are far below your purchasing power.
                
Once you have been prequalified for a loan the lender will ask you to provide documentation of your income and debts.  This will typically include bank statements, tax returns and a full credit report.  Once this is done the lender can issue a Pre Approval Letter that assures your ability to secure a loan.  When you make an offer on a home, you can attach a copy of the pre approval letter to demonstrate to the seller that you are a well qualified buyer who will be able to secure a loan to purchase their property.  Without a Pre Approval Letter, the seller will likely be apprehensive to accept your offer as they will have to take their home off the market while you start the loan process.  If you fail to secure a loan, the seller will have lost valuable time trying to sell their home and will have to start the process over.  Furthermore, if you end up in a situation where multiple buyers are making an offer on the property you want, a Pre Approval Letter will make your offer more attractive to the seller.

As always, if you have any questions, or would like a list of top notch Summit County Lenders please feel free to contact me anytime at the information below.  I am always happy to discuss your Summit County Real Estate goals.

All the best,

Tyler MacGuire
Broker Associate
Omni Real Estate Company
Cell: 970-409-7779
Email: tylermacguire@hotmail.com
Web:   www.tylermacguire.com  
         
      

"Your Guide to Summit County Real Estate"

Monday, October 24, 2011

Mortgage Terms Simplified


Many first time buyers struggle with the wide array of mortgage jargon and rightfully so.  There are points, rates, locks and a variety of fees that all need to be navigated in order to successfully close a loan.  The more you know about the loan process and the vocabulary associated with it, the more likely you are to secure the loan that is right for you.  Below is a list of some of the most common terms you should be familiar with so you completely understand the conditions of your loan.

Good Faith Estimate (GFE):  An itemized list of all the costs and fees associated with closing a loan.  A GFE uses a standardized form and is intended to allow customers to compare the costs of one loan with another.  The Real Estate Settlement and Procedures act (RESPA) requires that all customers applying for a loan receive a GFE. 

Underwriting:  The process by which a lender determines a borrower’s eligibility for a loan.  Underwriters look at credentials such as income, credit, debt and employment.

Principal:  The amount of money owed to the lender.

Amortization:  The process by which the principal decreases over the life of a loan.

Down Payment:  The amount of money paid upfront for your home.  Larger down payments result in lower monthly payments by reducing the amount of principal owed.

Discount Points:  Pre paid interest paid by the borrower to reduce the interest rate of the loan.  Discount points are tax deductable and typically cost 1% of the total loan amount.

Fixed Rate:  A mortgage where the interest rate remains the same for the entire life of the loan.

Adjustable Rate:  A mortgage where the interest rate can adjust up or down periodically.  With an adjustable rate loan it is imperative that you understand how often and by how much your rate can adjust.

Down Payment:  The amount of money paid upfront for your home.  Larger down payments result in lower monthly payments by reducing the amount of principal owed.

As always if you have questions about this or anything else relating to Summit County Real Estate, please feel free to contact me at any of the information below.

All the best,


Tyler MacGuire  e-PRO®, SFR
Broker Associate
Omni Real Estate Company
Office: 970-468-2740
Mobile: 970-409-7779    
Web: www.tylermacguire.com

       

“Your Guide to Summit County Real Estate

Wednesday, October 19, 2011

Assessed Value vs Appraised Value

              I have often been asked why there can be such a large discrepancy between the assessed value of a property and the appraised value.  To clearly understand this question it is first important to understand what exactly the two terms mean.  An assessed value is the valuation placed on a property by a public tax assessor, exclusively for tax purposes. 

            On the other hand, the appraised value is determined by licensed appraiser who uses a number of criteria including recent comparable sales, replacement cost and their professional knowledge of market conditions.  Furthermore, the appraised value is what lenders will typically use to determine the value of a home.

            All too often home owners and home buyers put too much weight on the assessed value of a home especially when it is favorable to them(high for owners, low for buyers).  However, the assessed value will have little if any influence on a lenders willingness to lend on the property.  Nevertheless, to get an appraisal done on a home can cost several hundred dollars. 

            So how can you figure out what your home is worth?  Contact your Realtor and have them put together a Comparable Market Analysis (CMA) for you.  A CMA will look at similar properties that have sold recently to give an estimate of value.  Furthermore, unlike an expensive appraisal that can only be done by a licensed appraiser, many Realtors will put together a CMA for you for free.

            If you have any questions about assessed vs appraised values, or would like a free CMA to estimate the actual value of your home, please feel free to contact me anytime at the information below.

All the best,


Tyler MacGuire  e-PRO®, SFR
Broker Associate
Omni Real Estate Company
Office: 970-468-2740
Mobile: 970-409-7779    
Web: www.tylermacguire.com

       


“Your Guide to Summit County Real Estate

Friday, September 23, 2011

What Can You Get for $300,000?

Many people have asked what they can afford and where the most attractively priced Summit County properties can be found.  In order to shed some light on this topic I have selected a $300,000 property from each area in Summit County and described it below.

Silverthorne Real Estate

Salt Lick Condo Unit 4836, $299,000

            Built in 1982, this 2 bedroom, 1 and ¾ bath unit is in the Wilderness neighborhood adjacent to national forest that provides great hiking, biking and cross country skiing right out the door.  Inside, this home boasts 1,071 square feet, ($279/square foot) a remodeled kitchen, jetted tub, wood burning fireplace and a washer and dryer. The association dues are $272/month and include Cable TV, management, water, sewer, snow removal, common area maintenance, common taxes, insurance, trash pick up and access to the community hot tub.

Keystone Real Estate

Cinnamon Ridge condo Unit 5, $299,900

            Built in 1983 this 2 bedroom, 2 bath condo is located walking distance to the lifts and River Run Village.  The property is 828 square feet ($362/ square foot) and has views of wetlands and Keystone Resort.  Inside this unit has been remodeled with new carpet, counters and appliances and includes a washer and dryer.  The association dues are $274/month and cover Cable TV, management, water, sewer, snow removal, common area maintenance, common taxes insurance, trash pick up and access to the community hot tub. 

Frisco Real Estate

Villas at Prospect Point Unit 102, $300,000

            Built in 1995 this 2 bedroom, 2 bath unit is located on the shores of Lake Dillon with easy access to I 70.  This property is 1,040 square feet ($288/square foot) and comes with a one car garage.  Inside, this home offers large bedrooms, hardwood floors and a washer and dryer.  The association dues are $300/month which includes Cable TV, management, water, sewer, snow removal, common area maintenance, common taxes insurance, trash pick up and access to the community hot tub.

Dillon Real Estate

Dillon Bay in Corinthian Hills Unit 103, $299,000
           
            Built in 1980, this 2 bedroom 1 and ¾ bath home offers a one car garage and great views of Lake Dillon and the Ten Mile Range.  This one level, ground floor unit with washer and dryer is 1,142 square feet ($262/square foot) and is just minutes to both the town of Dillon and Keystone Resort.  The association dues are $360/month plus $150/year which includes Cable TV, management, water, sewer, snow removal, common area maintenance, common taxes insurance, trash pick up and access to the Clubhouse which has an outdoor heated pool and hot tub.

Copper Mt Real Estate

Anaconda Condo unit 202, $299,000:

            Built in 1973, this 2 bedroom 2 bath condo is located just steps from the Super Bee lift and the Copper Mt Golf Course.  This 964 square foot unit ($310 per square foot), has a remodeled kitchen, expanded living and dining area as well as washer and dryer hookups.  The association dues are $1545.04 per quarter and include Cable TV, management, water, sewer, snow removal, common area maintenance, common taxes insurance and trash pick up.

Breckenridge Real Estate

River Mountain Lodge Condo Unit W 302, $299,900:

            Built in 1986, this 1 bedroom 1 bath condo is walking distance to both Main Street and the Gondola and offers views to the ski area.  The 584 square foot interior ($514/ square foot) has been completely remodeled with granite counter tops, new flooring, new appliances, new blinds and a washer and dryer.  The association dues are $553/month and include Cable TV, common area maintenance, common taxes, electricity, firewood, gas, heat, common insurance, management, security, snow removal, trash pick up, community pool and hot tub and access to the fitness room.

If you would like to see for yourself what other properties are available, please visit my website at the link below.  Once there you can conduct your own personalized property search and peruse a variety of information relating to Summit County Real Estate.  As always you can contact me anytime at the information below.

All the best,

Tyler MacGuire
Broker Associate
Omni Real Estate Company
Cell: 970-409-7779
Email: tylermacguire@hotmail.com


         

"Your Guide to Summit County Real Estate"

Thursday, September 15, 2011

Should You Trust Your Realtor When They Refer You?

Your Realtor gives you the name of two lenders and suggests you work with them to get a loan.  Now, there are lots of lenders out there so why would they pick these two?  To ask the question another way…what’s in it for the Realtor?  What kind of kick back are they getting and is their recommendation best for you, or for them?

You as the client have the right to know about any business relationship between the Realtor and the mortgage broker.  Furthermore, a federal law passed in 1974 prohibits the mortgage broker from giving kick backs or anything of value to the Realtor in exchange for there referrals.  This law, called the Real Estate Settlement Procedures Act (RESPA), also requires full disclosure of any affiliated or shared ownership business as well as the submission of good faith estimates to you on closing costs.  If you would like to learn more about RESPA see this link: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/rmra/res/respa_hm

Now, should you trust your Realtor when they refer you….the answer is hopefully.  Hopefully, you have a chosen an ethical and experienced Realtor who is working within the law and with YOUR best interests in mind.  Nevertheless, it is your responsibility to make the final decision as to whether to take their recommendation or not.  It is always a good idea to ask the Realtor why the have picked these lenders to refer you to.  If they say it is because they have a great track record of professionalism and closing loans then that’s great.  On the other hand, if they say that the lender is there brother in law, maybe it’s not the best choice.

If you have questions about Real Estate referrals or anything else regarding Summit County Real Estate please feel free to contact me anytime at the information below.

All the best,

Tyler MacGuire
Broker Associate
Omni Real Estate Company
Cell: 970-409-7779
Web: www.tylermacguire.com

        

Thursday, September 1, 2011

Summit County Real Estate Market Report

Residential Sales Prices
In Last the last thirty days there have been 178 new listings, 97 closings and there are currently 203 transactions pending.  Of these sales the highest price was $1,700,000 and the lowest was $94,000.  The highest price per square foot transaction was $729 while the lowest came in at $120.

Transactions By Price Point
Of the 97 residential closings 11 of them sold for over $1M and 11 were between $750,000 and $1M.  Between $500,000 and $750,000 there were 18 sales and the most active price point was from $250,000 and $500,000 with a total of 33 transactions.  Lastly, the second most active price point was under $250,000 with 24 sales.  This means that over half of the sales in the last month fell into a (roughly) $406,000 price range between $94,000 and $500,000!

Inventory
There are currently 305 residential properties for sale in Summit County listed under $250,000.  Between $250,000 and $500,000 there are another 667 properties listed for sale and another 330 listed between $500,000 and $750,000.  In the $750,000 to $1M price range there are 196 listings and another 306 properties listed over $1M.  When you compare the inventory (supply) versus the demand (actual sales) it is clear that we are in a buyers market.  Sellers know that there are few buyers in the market place and that even fewer are actually buying.  If a seller is asking too much for there home, it will likely remain part of our inventory for a long time.

Want to figure out how to make all of these numbers work for you?  Please feel free to call me anytime at the information below for a free Home Buyer Consultation.

Tyler MacGuire
Broker Associate
Omni Real Estate Company
Cell: 970-409-7779
Email: tylermacguire@hotmail.com
www.tylermacguire.com

       

Monday, August 22, 2011

Home Buying 101

Although buying your first home can be exciting, most first time buyers are intimidated by the process and technical terms that go along with it.  Furthermore, sorting through endless information on the internet can be completely overwhelming and leave you the buyer unsure where to even start.  The list below will help to serve as a general outline of the process but, is by no means a substitute for a good Buyer's Agent.

1.)  Choose a Realtor:  When interviewing a Realtor it is important to find someone you trust.  It is also important to pick an agent that focuses the majority of their business representing buyers and even better yet...first time home buyers.  If the Realtor acts like they don't have time for you, is impatient with your questions or works primarily with sellers, they are probably not what you are looking for.

2.) Meet With a Lender:  If you already have a relationship with a lender you are a step ahead but, most first time buyers do not.  Not to fear.  Assuming you have found an experienced and trust worthy Realtor to work with, they will be able to refer you to local lenders.  By meeting with a lender early on, you can figure out how much home you can afford so, you avoid looking at homes that are not in the right price range for your financial situation.

3.) Pick a Home:  This is usually the most exciting part of the home buying process.  Your Realtor will discuss with you what criteria you are looking for (number of bedrooms, number of bathrooms, location, garage etc.) to narrow down your search.  You can then go out and physically look at homes to determine which is right for you.

4.) Make an Offer:  Once you have found the right home, you will want to submit a Purchase Offer.  In order to determine a fair purchase price your Realtor will research past comparable sales to determine the fair market value of the home.  Once the purchase price is determined the Realtor will draft an offer for you to be submitted it to the Listing Agent.  To make your offer more agreeable to the seller, your lender will provide a pre approval or pre qualification letter that confirms to the seller your ability to secure a loan.  In addition, you will submit a portion of your down payment called Earnest Money to be held in escrow (NOT buy the sellers).

Your original offer can be accepted as is, rejected outright or countered.  If you receive a counter offer from the sellers your Realtor will explain the terms and conditions of it and you then have the choice to accept it as is, counter or reject it.  Having a Realtor that is a strong negotiator is crucial during this time to help you acquire the home at a price you are happy with.

5.)  Under Contract:   Congratulations your offer has been accepted!!!  It will still usually take four to six weeks for your deal to close and a few important things need to happen during that time.  First of all, you will want to get a Title Insurance Policy that insures against any liens or encumbrances on the property.  Assuming you picked a knowledgeable Realtor, they will have preexisting relationships with Title Companys and can guide you through this process.  You will also want to have a Professional Home Inspection done to find any defects with your new home.  Again, your Realtor should know several home inspectors and help guide you through this process.  Lastly, your lender will engage an appraiser to confirm that the home is worth at least as much as the purchase price agreed to.  Now, by no means is this an exhaustive list of all that happens while under contract but, it is a general outline of some of the bigger happenings.

6.) Closing:  Typically a day or two before closing you will be provided with all of the documents that you will need to sign.  It is important that you review these documents and be sure to let your Realtor know about any questions or concerns you have.  Sometimes closings occur in a formal, face to face meeting and sometimes they happen via fax, email and snail mail.  The means by which you sign closing documents will depend on logistics and geographical location of the parties involved.

These six steps serve as a great outline to give you the buyer a general idea as to what you can expect when purchasing your first home.  However, there are always a lot of details involved in a Real Estate transaction that a good Realtor will help you navigate.  If you want to know more about these details or have questions about anything related to purchasing a home, please feel free to contact me anytime.

All the best,

Tyler MacGuire
Broker Associate
Omni Real Estate Company
Web: www.tylermacguire.com
Email: www.tylermacguire@hotmail.com
Cell: 970-409-7779

      

"Your Guide to Summit County Real Estate"