Monday, November 30, 2015

7 Things That Will Fill You With Buyer's Remorse

Skip the Pain: 7 Things That Will Fill You With Buyer’s Remorse

Home shopping makes you a little (OK, a lot) house-obsessed. Between stalking online listings, flipping through all the design magazines, and gorging on HGTV marathons, you know exactly what you want in painstaking detail.
Ain’t nobody gonna say you can’t have what you want. And hey, we’re totally on board. You’ve earned this! Buy whatever you like (within your means of course)!
 But we’re here to share an unsolicited word of caution. All those custom details you’ve dreamed about? Make sure you really, really want them before you put in an offer—and that, in order to get them, you’re not sacrificing other things that will ultimately drive you bonkers.
We could go on and on about the flip sides that have the potential to fill you with regret. But we talked to some experts in the biz and boiled the list down to seven features. Pay close attention to these things that might set you up for the dreaded buyer’s remorse.Is the big backyard really worth all the hours of mowing and landscaping? Is your desire for more space making your home feel less cohesive? Are those floor-to-ceiling windows, which made you fall in love with the home, a total PITA to clean?

1. Don’t go big, just go home

You may want the space to spread out, but consider what rooms you’ll actually use once you move in. Do you really need five bedrooms, a game room, an office, and two formal living rooms? If you buy too big a home, you might end up regretting it when it comes time to cool, heat, and clean the place. And don’t forget room size. If the space is too big, your furniture will seem miniaturized. To avoid going too big (or too small), bring a tape measure and measurements of your own furniture to verify everything will look the way you want.

2. Don’t get boxed in

On the other hand, if you’re planning to stay put for a while, consider the home’s architecture. You may want to expand one day, and not all homes are set up for that. “Many buyers of split-foyer-style homes—where you enter and you’re at midlevel with the stairs and must go up or down—complain that it is difficult to expand their home,” says Cathy Baumbusch, a Realtor® in the Washington, DC, metro area. Instead, look for more flexible, one- or two-story homes where additions are easier.

3. Don’t let your stairs become an uphill battle

Finally, when you’re walking the floor plan, think of how you’ll use the space when you own it, especially if you’re looking at an older home. “Most buyers in my area want the standard three-story—two upper floors and a basement—Colonial-style home,” Baumbusch says. “This type of home often has the laundry room in the basement, which means the family has to haul laundry up and down two flights of stairs.  “It can get old fast.”

4. Get off the island … maybe

What we often consider to be an amenity can create remorse. Take, for example, the kitchen island. It looks cool. It adds more prep space. We all want one. Or do we?  “Kitchen islands can be a mistake if you don’t take your ‘work triangle’ into account,” Baumbusch says. Walk around the kitchen, following your usual prepping and cooking pattern. If you’re bumping into the island, you may end up hating it.

5. Pay attention to what’s missing

If the home is modern (or previous owners did some upgrading), take a hard look and ask yourself if anything is missing. Often architects and remodelers will take something out to give a room a cleaner, more minimalist feel, and you may feel the loss after you move in. “There is a trend to eliminate the bathtub in favor of just a shower,” Baumbusch says. “Some homeowners regret that decision, because sometimes they find themselves wishing for a nice long soak after a tough day.”

6. Pools may not be so cool

You step outside, see a pool and immediately picture all the backyard parties you’re going to have. We know, we know, pools are cool. But pools are also a huge expenseOn top of the regular monthly maintenance and cleaning (and there will be a lot of that), pools in seasonal areas are often opened and closed by a pro. Those costs add up. “It can cost upward of $600 just to open a pool and prepare it for swimmers,” Baumbusch says. Moral of the story: Pools are a big regret if the expenses cause a burden. Make sure you can comfortably afford the upkeep.

7. Don’t fall for fads

Today’s popular ice-white appliances, steel countertops, and Edison bulb light fixtures are yesterday’s saloon doors, linoleum, and brass hardware. If you buy a house just for its trendy look, you may end up regretting it when the styles change, especially if you have to sell the outdated design. Instead, Baumbusch recommends looking for timeless features. 
When all is said and done, look for a classic, well-designed home to ensure the smallest chance of stinging regret. It may not sound like as much fun, but you can always add a little (or a lot) of your style in the finishing touches.

Tuesday, November 24, 2015

How Do Homeowners Accumulate Wealth?

How Do Homeowners Accumulate Wealth?

Lawrence Yun for Forbes
The differences between buying and renting are massive.  According to the Federal Reserve, a typical homeowner’s net worth was $195,400, while that of renter’s was $5,400.  The data reflects 2013 and the next survey of household finances, which is conducted every three years, will be out in 2016.  Based on what has happened since 2013 and projecting a conservative assumption of what could happen next year to home prices if we see only 3% price growth, the wealth gap between homeowners and renters will widen even further. The Fed is likely to show a figure of $225,000 to $230,000 in median net worth for homeowners in 2016 and around $5,000 for renters. That is, a typical homeowner will be ahead of a typical renter by a multiple of 45 on a lifetime financial achievement scale.
Though there will always be discussion about whether to buy or rent, or whether the stock market offers a bigger return than real estate, the reality is that homeowners steadily build wealth.  The simplest math shouldn’t be overlooked. A vast majority of homebuyers take out a 30-year fixed rate mortgage to make a home purchase. After 30 years, there is no mortgage payment (nor rent payment). So the home price growth over that time period would be the equity that the homebuyer would have accumulated. For example, the median home price of a single-family dwelling in the U.S. thirty years ago in 1985 was $75,500. This year, it will be at least $220,000. That figure of $220,000 is the housing component of the person’s wealth. Even had home prices not risen, the person would still have $75,500 in wealth today – on top of not paying any further monthly mortgage after 30 years.
This simple example does not play out nearly as neatly in the real world, since people do not stay in one residence over the 30 year period. Almost all homeowners trade up, change neighborhoods, or move to a better school district at some point. However, they are able to make those residential relocations due to the housing equity accumulated, even over a shorter period, and can immediately apply that equity to the next home as a downpayment. Therefore the conditions of steadily building housing wealth still hold.
We also know that not everyone can or should be homeowners. The memories of easily accessible subprime mortgages and subsequent harsh foreclosure pains are still fresh, and remind us of the devastating impact on the families involved, local communities, and to the broad economy. In addition most young adults have not developed the financial standing or have found a stable, desirable career and, therefore, choose not be homeowners until later.  The homeownership rate among households under the age of 35 is 35% currently and rarely rises above 40% historically. For those under the age of 25, the current ownership rate is 23% and rarely rises above 25%. But the time will eventually come when people want to convert to ownership. By the time people are in their prime-earning years of 45-to-55, nearly three-fourths do eventually become homeowners. By retirement, nearly 80% are homeowners.
A recent survey of consumers commissioned by my organization revealed that 80% believe that purchasing a home is a good financial decision (2015 National Housing Pulse Survey). Most consumers appear to already understand the simple math and the benefits of homeownership. So don’t overthink the matter of whether now is a good time to buy, or whether stock market returns will be better. The exact timing of a home purchase will have little financial impact in the big scheme of things. Just know that homeowners generally do come out ahead of renters in the long run.

Lawrence Yun, PhD., Chief Economist and Senior Vice President

Lawrence Yun is Chief Economist and Senior Vice President of Research at NAR. He directs research activity for the association and regularly provides commentary on real estate market trends for its 1 million REALTOR® members.

Thursday, November 19, 2015

Marriage and Money: Merging Your Finances

Marriage and Money: Merging Your Finances
Combining finances goes deeper than names on the checkbook. Explore ways to make it work for the two of you.
Sharing your life with another is a huge commitment, full of exciting changes and challenges. But once the honeymoon is over, reality sets in—including the need to plan your financial future together.
If you've discussed how to approach your joint finances before the big day, congratulations—you're one step ahead. If you haven't, it's important to sit down and consider some options.
Merging finances
Some couples choose to combine their finances completely, closing old financial and credit card accounts and opening new, joint ones. Potential advantages include:
  • A clean slate
  • Ease of budgeting, since there are fewer accounts to keep track of
  • No delays in access to funds in emergency situations
For this strategy to work, both partners must agree on how the money is to be spent. Even the smallest expenditures may require a discussion, and frequent clashes could arise if one person is a saver and the other a spender.
Separate accounts
For those who have long managed their own money, keeping finances entirely separate may seem to be a no-brainer. However, it's not a simple solution. You'll need to determine who pays for what; for example, one spouse may be responsible for paying the rent or mortgage, while the other pays for utilities, food and insurance. Or, you could decide to split expenses and have each partner contribute his or her share.
The advantage of this approach is that both partners are free to spend their discretionary money as they wish, as long as they fulfill their agreed-upon financial responsibilities. However, this method usually works best if both partners make similar salaries. If one earns appreciably more than the other, deciding how to split expenses fairly—in half or proportionally according to income—can be a challenge.
A hybrid approach
This approach combines the merged and separate account strategies. For example, you could set up a joint account or accounts for household bills (rent, mortgage, utilities, insurance, food, etc.) and mutually agreed-upon expenses (such as vacations or entertainment). In addition, each partner would have a separate account or accounts to pay for discretionary items.
This method still poses the same challenges of who contributes how much. However, it may help foster your financial partnership while giving each of you the ability to spend some money independently.
Have "the talk"
Regardless of your approach, it's important to maintain open and honest communication. Be frank with each other about existing debt—your spouse or partner should be aware of how much you owe. Talk about future financial goals, such as buying a home, paying for college, having children and eventual retirement. If each partner has adequate information and equal input into decisions, things may go more smoothly no matter how you divvy up the cash.
As a Navy Federal member, you have access to a wide range of savingschecking and loan products to help you manage your joint and separate finances. You can also talk to a Financial Counselor to help create your strategy as you plan your new life together.
Federally insured by NCUA. This article is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.

Tuesday, November 10, 2015

Pet Design in Today's Homes

Gone to the dogs? Today’s home design has pets in mind

Gone to the dogs? Today's home design has pets in mind
Homeowners today aren’t just remodeling with their own needs in mind – they are keeping their furry friends in mind as well.
The concept of pet-friendly home design has been growing over the last few years. Today, homeowners are building features directly into their homes to accommodate their pets’ eating, sleeping and exercise needs.
In fact, here are three of the more common pet-focused home design trends across the country:
1. Built-in dog dishes
Where to put the dog dish? The answer to this question has some homeowners thinking outside the box. For example, a popular choice is the built-in eating nook into a kitchen island. Other homeowners have made a similar change at the end of the kitchen counters. Dishes can also be built into a floor-level cabinet, so they can slide in and out as needed.
2. Hidden kennels
An overarching theme of pet-centric home design is seamless integration. That concept continues with the next design feature: the hidden kennel. Homeowners are building kennels directly into the home itself. The kitchen island is once again a popular spot, but some homes even have one built into the wall. This removes the need for a metal or plastic kennel in a room or the garage.
3. Pet-friendly fabrics
The last design trend is as much for the human as for the pets. Homeowners are looking for more ways to keep their homes clean while owning animals, and for many the answer is pet-friendly, stain-resistant fabrics. One popular option is actually indoor-outdoor fabric, which can withstand a wider variety of spills and messes. Best of all, it can clean a whole lot easier.
These are just three pet-focused home design trends. Have you seen any interesting ideas in your neck of the woods?

Thursday, November 5, 2015

Existing Home vs. New Construction: Which is better for you?


  • I would much rather be buying working on and living in an existing home that I can remodel in parts to to the 'character' of the home, and affordability to start...
  • Posted by Jeffrey on September 24, 2015

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