Why do we feel the need to live in outrageously oversized homes? Do we really need master suites with bathrooms the size of a hotel room? Do we really need a home with an office, a den, a workout room, a toy room, a media room, a living room and a family room? Do we really need 20-foot vaulted ceilings? Do we really need both dining rooms and table areas in the kitchen?
The simple answer is no. That’s why lots of people are choosing to downsize during this tough economic time. But how do you know how much of a downsize you can handle? You decide how much space you really need to survive. As it turns out, not much!
This article from the Mother Nature Network displays the 10 smallest houses in the world. Let me tell you, they are small. Tumbleweed Tiny House Company has been making houses as small as most people’s closets, but somehow they still encompass a workspace, a bedroom, a bathroom with a toilet and shower, a living space and an outdoor porch, not to mention architectural appeal! Micro Compact Homes measure out to about 266 centimeters cubed and somehow still include two double beds, a bathroom, a lobby, a dining space for up to five, a kitchen and modern entertainment technology. Rollit homes turn like a mouse on a wheel. When you walk in the center of the home, the home turns and reveals different uses, such as a bed, a chair, a table, a toilet or a kitchen sink. One guy even created a trailer home that connects to his bicycle and includes a solar oven and a heating unit. It doesn’t get more eco-friendly than that!
What does this prove? People around the world are finding ways to live comfortably in smaller spaces. No, it doesn’t mean that you need to make a change this extreme. But it does definitely give you something to think about.
It’s an age-old real estate dilemma: when choosing a new home, do you go for size—more bedrooms, greater square footage, a big backyard—or setting—in a good school district, near work, near friends?
For many homeowners, the answer involves compromise, even in today’s buyers’ market.
A recent article in the Wall Street Journal pinpoints the issue by describing the story of a North Carolina couple faced with choosing between the house they wanted and the schools they wanted for their kids. In the end, Kiely and John Adams missed out on a compromise property that gave them some size in their desired location, due to complications with their own home “came up short on the appraisal.” Now they are staying put longer than expected, with their kids about to start a new school year.
The truth is, although not all home buyers look for locations with good schools, buying a home in a good school district is a smart investment. Why? Those areas hold their value better, even in tough markets.
A recent article at MarketWatch.com points out that as the tax credit ends, some sellers are taking notice. In order to compensate for the credit buyers could have previously gotten, these sellers are lowering their listing prices.
This way, buyers benefit from a lower price with or without the credit!
Now that’s what I call savvy selling!
from the article: “The expiration of the credit could be prompting home sellers to slash prices: 22% of listings on the market as of May 1 experienced at least one price reduction — that’s a 10% increase from the previous month, according to data from Trulia.com.”
Wondering what this means for you?
- Sellers: Take note! Now is the time to rethink your home price. Buyers won’t have the tax credit working in their favor, so you need to ask yourself how you can woo them in! Can you lower your price? Other sellers will be. Think about it!
- Buyers: Take heart! Even without the tax credit being available, you are still benefiting from it. Pay attention to FSBO listings you’ve been watching, and look for lowering prices. At least some sellers are getting more aggressive, and you could reap the benefits!
I came across a helpful article recently, which explains what does and doesn’t make a motivated seller a good thing.
I know what you’re thinking: when would a motivated seller not be a good thing?
Well, according to the article, it’s obviously fantastic to buy from a motivated seller in cases where:
1) A bank is wanting to get rid of a foreclosure and sells it at a reduced rate, under market value.
2) The sellers are moving/relocating and need to sell quickly, so they offer it at a reduced price.
On the other hand, it’s not fantastic to buy from a motivated seller when:
The house is a disaster, filled with defects and in need of major repair.
Reading the article, I was reminded of the age-old wisdom, “If something looks too good to be true, it probably is.” While of course there are deals to be had in real estate today, it pays to be cautious. Just because something is a good price doesn’t mean it’s a good deal.
So how can you avoid getting stuck with a lemon of a house?
- Get a home appraisal and/or inspection done before purchasing.
- Be on the lookout for potential problems in the home.
- Find out why the sellers are selling.
- Don’t be in a rush.
What about your thoughts? Have any of you been at the good or bad end of a motivated-seller deal? I’d love to hear about it!
My favorite blog to keep up with, the Buy Owner Blog, added a new category of blogs. If you are selling your home and moving to a new city, or you are searching for a city to relocate to, this category is for you. If you are looking for a place to vacation, this category is also for you.
It’s called Featured City and is located under the Buying Tips tab. Each blog focuses on a different city that Buy Owner works in or around. The blog provides helpful information on the city, from population and weather conditions, to local attractions and the distance to surrounding cities. If you’re interested in the city once you learn more about it, the blog lists houses, condos, apartments or the like that are for sale in that city. Click on the link and read more about each available residence. It’s as simple as ever!
Cities that the Buy Owner Blog has covered thus far include Aurora, IL, Lakeland, FL, Marietta, GA., Hialeah, FL and more. Check back often, as a new featured city seems to be added every week or so.
It’s no secret that today’s economy has made selling difficult. Last month, an article in the Las Cruces Sun-News explored exactly what that means.
In part, the article points out, this economy demands more of sellers, from updating and decluttering to flexibility and savvy pricing.
“Howard Dukes, an agent with Coldwell Banker in Las Cruces, said that potential buyers need to walk through the door and feel a connection to the home.
‘Create a wow factor so that when somebody comes in they say, ‘I can see myself living here,’ Dukes said.”
The article goes on to list five specific ways to improve a home’s appeal, borrowed from about.com. To read the full article, click here.
When it comes to the question of roommates, the pros and cons are obvious. On the plus side: more space, lower costs, often in a nicer area than one individual roommate could have afforded. On the minus side: living with other people and all the problems, compromises and inconveniences that can bring.
In Japan, according to a December Wall Street Journal article, the idea of roommates is gaining steam, particularly among young, female professionals:
Japan has no real tradition of roommates: People have preferred to live in their own tiny places. Now, fed up with a dearth of reasonably priced apartments in desirable Tokyo neighborhoods, a growing number of relatively affluent women in their 20s and 30s have started to create demand for a radical new segment of the Japanese real-estate market: apartments to share. (Wall Street Journal, 12/30/09)
The article goes on to say that these women sometimes find shared spaces a little uncomfortable, but that’s not to say they can’t work.
And finding roommates in order to afford housing is not only common in Japan. According to a study done by the Pew Research Center, an increasing number of young people are either moving in with parents or needing roommates to get out on their own.
So is it possible? Are roommates the new affordable housing? What do you think?
Trying to decide whether to buy a home that’s unfurnished or fully furnished? There are certainly benefits to buying a home that’s fully furnished. For one thing, it’s convenient. You can move right in without having to worry about buying a bed to sleep in or a couch to sit on. But then again, you won’t be able to pick furniture according to your own personal taste. Some home sellers are even including things like towels, dishes and linens. I don’t know about you, but I don’t necessarily want someone else’s towels or bedspreads. I’d like to be able to make my own choices when it comes to something as personal as my home. Just something to keep in mind as a home buyer and as a home seller.
For most people, the thought of buying a home with 100% cash, no mortgage, seems like an impossible dream. But the benefits—no monthly payments, full equity, financial freedom to pursue other interests or opportunities—cannot be denied.
Perhaps that’s why some of today’s home buyers are doing just that: buying their homes with 100% cash. Take a look at these clips from around the Web:
- BuyaHousewithCash.com
“For many people, the cost of renting or paying a mortgage is the biggest chunk of their monthly budget. When that cost is eliminated, you have the financial security that most people only dream about.
People who own their own homes without a mortgage know that a minor downturn in the local job market or the national economy won’t put their home at risk of foreclosure. True home ownership may also allow you more financial flexibility. “
- Xin Lu at Wise Bread
“You actually own your house - I think psychologically there is a big benefit in knowing that you own your house free and clear. You also free up quite a bit of income because you will have no rent or mortgage.”
- DaveRamsey.com
“The most ideal way to buy a house is the 100%-down plan. Sounds weird, doesn’t it?! But think how much fun that would be! Don’t borrow money. Period. If I can’t get you to postpone the purchase that long, I strongly suggest you save a down payment of 20% or more, choose a 15-year (or less) fixed-rate mortgage, and limit your monthly payment to 25% or less of your monthly take-home pay.
You want your new home to be a blessing, not a curse. If you buy a house with nothing down and a huge monthly payment, you’re inviting Murphy to move into the spare bedroom. You do not want Murphy as a housemate - believe me! Slow down and realistically think through everything before you jump head-first into making this major purchase. If you don’t, you’ll just be giving Murphy an open invitation to overtake the house.”
- MoneySavingMom.com
“As you will recall, our big goal for this year is to save up enough to pay 100% cash down on our first home. This has been a long-time dream of ours and we’ve been actively working the past year towards this. In actuality, though, we’ve been dreaming and working towards this even before we got married.”
I have a lot of respect and admiration for people who pursue this goal. And I have to say - reading their thoughts only increases my faith in For Sale By Owner home selling. By selling with a reputable FSBO company, you get all the important exposure and advertising, while keeping the large chunk of commission that could have gone to an agent. By buying through a FSBO home, you get the best price possible, since 6% doesn’t have to be added on for commissions. Makes sense, doesn’t it?
Thinking of buying a new home? Worried about getting the best rate on your mortgage?
Take a look at the GuaranteedRate.com and Zillow.com!
Here’s how they work:
GUARANTEED RATE.COM*
1. Choose loan: purchase or refinance.
2. Pick the state in which you live.
3. Enter an estimated loan amount.
ZILLOW.COM*
1. Choose loan: refinance or home equity
2. Type in the purchase price of the house.
3. Enter your zip code.
In order to find the best rate, you begin the process the same way on each site entering the type of loan, your location and the estimated amount needed. However, while Zillow provides a list of lenders (leaving you to do all of the work), Guaranteed Rate does the work for you by giving you their result in addition to offering its competitors’ information up front to ensure that you’re getting the best rate possible.
*Neither service requires your Social Security Number.
