FSBO Jane

According to bobvila.com, eight in 10 second-home buyers think that now is a good time to purchase a vacation home, even considering all of the economic factors involved. Still, it’s a tough decision to make. The availability of homes is high, and the price is reasonable, but why are so many present homebuyers trying to sell their vacation homes? Are people taking vacations? If you have thought about purchasing a vacation home as an investment opportunity, here are some of the pros and cons that bobvila.com provides as food for thought:

Pros:

• The availability is abundant, along with the choices. Most vacation-rich areas are full of houses that are available for purchase, and you can take your time shopping around to find what suits your preferences most.
• The prices are right. Along with the whole housing market, this arena has been affected by the economy, making the prices lower.
• Most prices are lower, but not significantly on clearance, which is a good sign. Current owners aren’t completely desperate to sell.
• In many vacation areas, such as Florida, Arizona, Nevada and California, 41.5 percent of houses for sale were bank-owned homes with significantly reduced prices. These cost less than they would to build them now and are a great deal to snatch up.
• As a vacation home owner, if you enjoy the area and residence, you could use it as investment now and turn it into a retirement home later. The opportunities are abundant for you.
• Most popular vacation destinations are offering discounted rates to attract visitors even during a financially troubled time. This factor keeps people coming.

Cons:

• So many more factors need to now be considered. Obtaining a mortgage is more difficult, interest rates have increased, underwriting is tight, and current or past debts are taken into consideration. The whole process is time consuming, and the result is not always positive.
• Mortgages for vacation homes are generally higher than regular homes, because if the owner experiences financial trouble, the vacation home is the first that he or she will give up on. More of an initial payment might be expected.
• Lots of research needs to be conducted by the potential buyer, to make sure that the investment is worth it. Research the area, the amount of visitors that it attracts and the future expansion that is planned for it. The best bet might be an area with low supply now, but significant growing plans for its future.
• Depending on the weather, the heating/cooling bill might be atrocious, and this is just one factor to consider. Also, think about the insurance costs! A house on the beach might sound perfect, but its insurance premium will be way higher than the house across the street from the beach.
• Vacationers might not want to stay in your home. What could go wrong? Natural disasters might keep people away, such as hurricanes, earthquakes or forest fires. Because of seasonal weather changes, the area might experience unpopularity at certain times of the year. Future construction plans might keep people away, such as a beach restoration. You can control the home itself, but not the future success of the home’s surroundings.
• You don’t know how much better or worse the economy will become, or when. Discount rates might not always be enough to allow people the chance to travel.

Though these pros and cons are factors that are affecting the current vacation home market, one factor will always remain the same: nothing is certain. Buying a vacation home will always be a questionable fate. If it’s a risk you’re willing to take for possible, sizable revenue, do it.

To read the article from bobvila.com in its entirety, visit here.

This post is especially for you first-time home buyers (or would-be first-time home buyers). Sometimes the best thing is to be able to hear the stories of someone who’s gone before you, right?

Enter the Johnsons.

This artist couple blogs over at ReadyMade about the entire process that led them to buying and now owning their Victorian home in California.

Interesting read. Go check it out!

Image source: ReadyMade.com

Let’s start with the acronym. F-I-C-O stands for the Fair Isaac Corporation, the organization that coined the term. So that’s where the term originated, but that’s not where the meaning ended.

Today, a FICO score is an important part of a credit report that helps lenders determine whether or not to extend credit and demonstrates the level of risk associated with a potential borrower.

It doesn’t only come into play with real estate; it can affect other bills you pay, where you live and even where you work.

What determines your score?
Several factors go into determining your FICO score, including payment history, amount of debt, length of credit history, new credit and types of credit.

What can you do to improve your score?
Establish a history of credit whereby you always make payments on time. If you’re about to apply for a line of credit for some reason, don’t make any big changes such as opening a new card, as those can temporarily lower your score.

Holidays usually bring a fun, festive décor into your home, and a decorating diversion to look forward to. However, while you are trying to sell your house, the rules change. Do you want a potential homebuyer to remember your decorations or to remember your house? For home sellers, keeping the decorations to a bare minimum is the best choice you can make. This October, here’s a list of Halloween do’s and don’ts to help you out:

• Do decorate with festively fall décor, such with as pumpkins, an array of gourds and squash, seasonal mums, and inside, freshly picked apples. About a week before Halloween, carve the pumpkins and place a candle inside to light up the design. Dispose of the pumpkins on Nov.1.

• Do place some sort of festive greeting or wreath on your front door, and Halloween stickies are okay to stick onto one window, such as the window above your kitchen sink, or the window in a child’s bedroom. Don’t go overboard.

• Do add decorations on Halloween day: this is the day to go all out and not worry as much about potential homebuyers. For trick-or-treaters, create an explosion of spooks and shrills in your entryway by hanging spider webs in the corners, flanking a staircase or doorway with carved, lit up pumpkins, hanging a skeleton or ghost from the door, or setting up a masked monster on a bench. Take down all décor by Nov. 1.

• Do offer homebuyers’ leftover Halloween candy for a week or two after the holiday has ended! Fill a festive bowl and leave it on the kitchen table or island.

• Don’t allow your Halloween decorations to be the first thing that potential homebuyers notice about your house. Keep the outdoor decorations to a minimum, such as a few pumpkins, in order to keep the focus on the house itself.

• Don’t scare away potential homebuyers, literally. You want them to feel welcomed, not scared. Steer away from hanging skeletons and swaying ghosts, and definitely forget the talking gravestones and creepy musical tunes.

• Don’t clutter your interior with unnecessary objects. If your fireplace mantel is a central selling point, don’t cover it up with sticks, leaves and pinecones. Don’t switch custom window curtains or classy tablecloths with Halloween alternatives.

• Don’t leave Halloween costume scraps around in the open, and hang finished costumes and props away in a closet. You want buyers to walk away from your house remembering your house, not the intriguing costume that they now want to recreate!

No matter what time of year you are selling your home, the home itself comes first. You’ll have plenty of future years to decorate your new home.

If you thought home prices were bottoming out, you may be wrong. They’re expected to head a lot lower.

Home values are predicted to drop in 342 out of 381 markets during the next year, according to a new forecast of real estate prices.

Read the rest of the article from Yahoo! Finance here.

I loved the following advice I read over at the ZenHabits.net blog. Small steps, done consistently, make all the difference in keeping up with your house work!

Here are the first few tips listed:

1. Never leave dishes in the sink. Or counter. Clean up any messes in the kitchen after I’m done. Wipe the counters, keep the sink clean.

2. Tidy the bathroom as I go. After I use the bathroom, clean the sink, the toilet, spray down the shower, real quick. It only takes a couple of minutes, and the joy of a clean bathroom is unmatched.

3. Pick up as I go. There are little things the kids leave around the house. I’ll just pick them up throughout the day, or keep a basket for their stuff and just dump them in there, for them to put away later.

4. Never leave clothes out. I have a tendency not to hang my once-used but still clean clothes in my bedroom, leaving them out to clutter the place up. No more. They either go in the dirty clothes, or they get hung in the closet.

To read the rest of the article, click here.

Quick tip: Buy patio furniture during the off-season; specifically, the off, off-season.

Are you looking to replace your patio furniture? Or perhaps you are looking to purchase some pieces for the first time? Either way, it’s good that you’ve waited until now to do so… and you may want to wait even longer. You ever notice how you see a bevy of bathing suits being sold in clothing stores when it’s 40 below zero? The same concept goes for patio furniture. Next month, while people are flocking to the store for Christmas trees, wreaths, lights and everything else Santa related, make your way to the back of the store. Tucked away, almost hidden from view, you are bound to find do-it-yourself patio sets. These boxes may be marked down as much as 70%!

I enjoy visiting the real estate section of the Chicago Tribune, mostly because it provides articles about both informative and quirky real estate in my area, and I enjoy the local aspect. However, when I came across this article, I had to write a detailed comment that argued the subject matter.

Titled “6 homebuying mistakes and how to avoid them,” the article offers tips that I mostly agree with and have even recommended to my readers in past blogs. It says to avoid not getting pre-approved for a mortgage: true. If you do get pre-approved, it saves time, improves your credibility and lets you know what you can afford. The article also says to avoid not using the tax credit, which I also just informed you of. Unless Congress decides to extend this offer, your deadline to use the free $8,000 tax credit expires Nov. 30. Three more tips are offered, which are more abstract and can be read here.

One piece of advice that stuck out to me was this: avoid working without a real estate agent. False. It claims that the real estate world is too complicated for an average person to figure out. Guess the writer doesn’t have much faith in the common people.

Once you decide that you need an agent, the article recommends that you interview multiple agents to find a credible one, and to fight the pressure to buy that some agents present to you. Who has time for all that, when you’re trying to find the right house at the right price, without a bunch of other fees, like paying for an agent?

I’m here to tell you that you can handle the FSBO (for sale by owner) way. You have all sorts of online guides, articles, blogs, books and newsletters that will help you along the way. When advertising online, websites offer detailed guides to help you with the process. If you work through a company like Buy Owner, you get tons of advertising, total control of your sale and no commission payments. You sell your home, and you get all the profit!

So who needs an agent? Do it the FSBO way! To read the article and voice your support of FSBO buying and selling, click here.

Attention, all of you in California! If you’re remodeling your home, you must check out KitchenExpo.com. Head designer and owner Rick Fahmie created this full-service kitchen, bath and construction firm in 1984. He says that he “tries to work outside the box to create trends, not follow them.” So whether you want to spruce up the kitchen, the dining room, the living room, the bedrooms, an entertainment room or really any kind of space you can think of, this is the place you should call.

Some of these exquisite materials (woods and fabrics) may look really expensive, but Kitchen Expo has something for every budget. If you notice, the designs are known for their unique curves, as opposed to conventional lines typically seen on a give table or cabinet. For example, take a look at the photo gallery for the first traditional kitchen. The countertops curve, the island is round and the cabinets boast arched details. From looking at the pictures on this site, each room looks like it should be an exhibit at an art museum!

Have you ever wondered where, exactly, mortgage lenders get their money? And did you know that you can actually make money off of mortgages? While I don’t advise newbie investors rush to take their chances on an endeavor such as this, I will explain the basics of mortgage-backed securities.

A mortgage-backed security is an interest in a pool of money that is issued and sold by larger mortgage lenders and government agencies like Fannie Mae, Freddie Mac, the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC) to the financial markets. Essentially, groups of mortgages are packaged into a bond purchased by investors. These bonds are generally priced at $25,000 at least, thereby generating new loans for future borrowers.

Because the housing market is not doing well, and foreclosure has been on the rise for a few years, investing in mortgage-backed securities is more risky these days. You should keep in the mind that it’s a risk, in general, to invest in other peoples’ money. This system is intended to work well as long as people (homeowners/loan borrowers) pay their debts. And if these people cannot afford to pay their mortgages, thereby facing foreclosure, the investors lose out, as well.