Your Primary Home is First.
Buying your own home gives you a place to live and teaches you the cost of home ownership, financing and market conditions. You receive tax benefits and an asset that you can sell, many times for a profit. You will also learn about property maintenance and build your own network of professionals who can prove to be invaluable when investing. Finally, your first home could later turn into your first investment property! When you decide to upgrade or get a bigger house, you might be able to keep your first home as a rental property. Consult your real estate advisor to find out if your house would make a good rental property.

Knowledge is Key.
Being a savvy investor takes more than just buying up properties. Having a good knowledge base goes a lot further than a “sixth sense” for good deals. Use the Internet, read books by reliable authors, and attend investment groups and college courses. These are all good resources to learning the best investment practices. You should also tap into other successful real estate investors and real estate agents for information.

Professional Help Is Essential.
Although you may not think you need help, a trustworthy and honest professional may be the partner you need. When it comes to spending tens or hundreds of thousands of dollars, I’m sure you want to invest it wisely. You go to a dentist for your teeth, a CPA to prepare your taxes, a doctor when you feel sick….so why would you think a realtor is any less necessary as an important professional to include on your family team? Real estate is usually what people spend the most money on in their lives and yet they’ll take short cuts and risk losing thousands of dollars trying to be an expert on their own. Realtors manage real estate transactions every day, whereas you may only handle one every few years.

Management companies take the pain out of property management. For instance, managing a rental property takes a lot of time, and you will need to be prepared to make repairs, resolve issues and advertise for renters if you are taking on the task yourself. In the long run, a management company may be just what you need. Use the referrals of friends, family and associates to find reliable, honest professionals to help you.

Know the Market.
Before you invest, research the local market thoroughly. There is no universal real estate “bubble.” Each market is different, and has different fluctuations and trends. One market may be good for rental income but not appreciation, while another market may be excellent for appreciation but not for rental income. There are endless variables, and it is important for you to know exactly what you’re getting into. Remember that one area is never the same as another area. Even within your local market, different neighborhoods may have their own fluctuations and pros and cons. Turn to your realtor for advice about your intention and what neighborhoods and areas will best reach your goal.

With these basic tips under your belt, you are ready to venture out into the investment arena. Happy investing!

$258,000
4 Bdrm/2 Bath
1676 sq ft
MLS #2932288

Needs TLC. New pool pump. Excellent neighborhood and desirable area. Big lot with swimming pool and big backyard with grapefruit tree. NO longer a diving pool, only 5 ft deep. Good home for an investment, fix up, first time home buyer. NO HOA! Close to all amenities…shopping, dining, golf. Scottsdale Fashion Square within minutes. Freeway within 5 minutes with easy access to Phoenix. Family estate sale.

Gorgeous brick fireplace in living room/great room open to the kitchen

View of Wilshire St from front yard

In a buyers’ market it can often be tricky to get even close to your asking price. There are, however, a few things you can do to help get a little closer, or even actually get your asking price. A recent Realty Times article discussed some of the following tips that most people can implement to help get the asking price… and sell the house as soon as possible. There are generally three categories that they fall in:

ONE
Finish the unfinished rooms or convert any convertible rooms, such as the basement or a recreational room. Not only does this give an increased amount of usable space, but it can also be used as a selling point since these are expenses that the buyer doesn’t have to incur. Not to mention, there seems to be an increased desire for move-in ready homes where the buyer does not have to do a thing to the house.

In houses over $500,000, offer a free media room. With deals, you can probably have one installed for around $5,000. Media rooms are something many house shoppers see as a neat luxury, and could be the difference between someone going for your house or someone else’s. Just over a year ago, Architectural Digest united with Sotheby’s International Realty Affiliates, Inc. in a consumer-trend study to find that 32% of people seeking a secondary home wanted a media room/home theater. For more info on top amenities buyers look for in luxury homes, click here.

TWO
You can make the mortgage on your house more desirable by buying down the interest rate. This is something fairly easy to offer someone, and a lower payment certainly makes your home more desirable!

Rather than offering a cash-specific incentive, you can offer something else like a vacation. Again, this makes your offer stand out from other offers.

Offer seller financing. This is actually not that difficult to do if you can make the deal work, and can actually end up earning you some money. Talk to your realtor about the possibilities.

THREE
Offer to pay their HOA fees for a year. This is a practical buyer benefit. If someone is carefully looking at their budget, not having to include these fees in their monthly expenses can be a big deal.

Offer to pay off some of their debt. If this is done as part of the loan program, then it could lead to the buyer qualifying for a larger loan, or a better interest rate. If just a side agreement, then again, it could mean lower monthly payments, which can be extremely important to the buyer.

Finally, you can always offer to pay the closing costs. These tend to be something that is a big hit to buyers’ pocketbooks, and something people don’t adequately budget for when shopping for a new house.

Unfortunately, other than the few aesthetically appealing things you can do to spruce up the house, real incentives tend not to be cheap. They can mean the difference from having to drop your asking price by quite a few thousand… or actually getting what you want! The key to choosing which incentive to go for is to think about what incentive works best for you AND what is a true attraction for the demographic of buyers looking to buy your house and in the community you’re in.

Make your home desirable for a buyer. What made you fall in love with your home when you bought it? What are the home’s weaknesses? Be clear on both of these and enhance the strengths and minimize the weaknesses. If the house lacks storage space, don’t enhance that fact by not cleaning out the closets so when the prospective buyer opens it they get pummeled by your stuff falling on them! Organize the closets and cabinets so everything appears neat and spacious. This doesn’t cost anything other than time and possibly a good friend to keep some of your stuff in boxes.

If you can’t afford big-ticket items such as renovating your kitchen or adding bathrooms, consider small improvements that can make a big difference. A recent survey found that a simple hanging storage system in the garage was more valued by buyers than a big kitchen, big backyard or a formal dining room!

Also make sure you do little maintenance things to enhance curb appeal, such as washing the windows, trimming bushes, repairing the driveway, repainting the front door and making sure the doorbell works.

Finally, a dirty house will always put buyers off. If you have to, hire a cleaning service to clean your home once a week while it’s on the market. With so many homes to choose from right now, buyers don’t have to see pass the dirt and how a house “could” look like a home. They just want to see the next home on the list!

Could you treat your family member like this??

As more and more home foreclosures hit the market, the biggest and most unknown losers are family pets who are being deserted by their owners.

Animal welfare experts say that the United States slumping housing market has led to an increase in the number of abandoned animals. For some of these homeowners, feeding their pets is just not affordable anymore. Many homeowners are having to move in with relatives or find rentals where pets are not allowed.

Pets are being dumped all over the country. Dogs are being found in farms and domestic cats are showing up in feral wild colonies. Even worse, some pets are being left behind in their foreclosed homes without any food and water.

Many foreclosure homes and go weeks without having a showing. An animal left behind does not stand a chance. It can take weeks for an animal to starve to death. Desperate scratch and bite marks are usually found on doors, windows and baseboards.

Recently, the animal rescue group, Paw Placement, was part of a a huge rescue mission to save abandoned cats that were left behind by their previous owners in a demolished apartment building. Many of these cats were starving and sick due to neglect.

Although some pet owners may think they are doing their pets a favor by not taking them to a shelter or the local pound, they are mistaken. Pets get dependent on their owners for food and their well being. They are domestic animals that are not equipped to survive on their own. They have no chance of survival by being abandoned and their fate is ultimately a painful and suffering death.

Homeowners facing foreclosures should be encouraged to bring their pets to the local humane society or Animal Care and Control facility. In these facilities, their pet at least has a good opportunity of being adopted. Although not every pet will find a home and may be euthanized, they still have a chance. As Stephanie Shain from the humane society put it, " They’ll be fed, have water and/or have a humane euthanization, as opposed to spending the last days of their lives eating carpet or wallboard."

*** Pet abandonment and pet dumping are illegal in most of the United States. In Arizona, this is a class 6 felony.

On the news this morning, I saw that “foreclosures were up 75% from December 2006 to December 2007.” 1 out of every 100 homes are going into foreclosure, with California and Florida hit the hardest. Knowing that this amount of people are entering into the foreclosure process, I felt that providing a few helpful tips on how to prevent a foreclosure was imperative.

For those of you who know me, this one’s for you: I am aware that it’s not all roses and sunshine in the housing market (’heck’, I WORK in it every day), I don’t completely have my head in the sand! However, I am a proactive person that looks for solutions. . . so let’s get to it!!

If you’re starting to miss payments, this is your big neon sign, your red flag, your 2×4 in the head. Pay Attention. This is also an OPPORTUNITY. What do you think the first mistake is? You got it. Homeowners stop answering the phone, returning phone calls or opening the letters from the lender. This is the opposite of what you should be doing. You need to ACT.

Take Action. There are several things you CAN do. Foreclosure begins once you miss three payments. You may have from 3 to 18 months before you actually have to get out of the house, depending on what state you live in. Therefore, you have some options. And, that does NOT include trashing the house. I just don’t understand what people are thinking they will gain by doing this. ??

First of all, if you have a variable rate loan and your interest rate is going up and you can’t afford the payments, which will get higher each time you miss a payment, call the lender. You heard me right. Reach out to them! Ask for a reduced and/or fixed rate. Realize that the bank loses an average of $59,000 for each foreclosure. Therefore, they might just be willing to negotiate a lower rate with you…especially if you have always been a good paying client until the rate started to increase!

Negotiate a short sale. A short sale is when you owe more than the property is worth. The declining market had something to do with this, but let’s face facts. Some of you took out home equity lines of credit for vacations and toys. (It’s true. You know who you are.) You will get a bad credit rating still, but you will only show the late payments while the loan is reported as “satisfied”.

Apply for an FHA loan. It is a short term, secondary loan that buys you time. You can get up to 12 months of payments. You will have to pay them back, but it buys you more time.

Rent your house . Sometimes, you can rent your home out and move into a less expensive housing situation. Even while your home is in foreclosure, you may be able to do this. If you can get enough rent to cover the mortgage payment and find another alternative for yourself that you can afford, this could be an ideal situation.

Deed in lieu of foreclosure is another option. This is when you give the deed to the lender. You may even able to stay in the house for awhile.

I hate recommending this, but it is a last ditch option. File for bankruptcy. It doubles the time you can spend in your home, sometimes up to four years. Yes, you will have very bad credit. But, you will be able to stay in the house. When you file for personal bankruptcy, you actually keep your credit cards as long as you’re making the monthly payments!

If you’re starting to miss payments, don’t put your head in the sand. Start to look at your options. There may even be 2 or 3 of the solutions listed here that you can take advantage of to prevent you from entering foreclosure and save your credit.

There are a number of good reasons why buying a home makes good economical sense regardless of the housing market.

1. Homeowners build equity in their homes that can be used as collateral for a home equity loan, or as part of a retirement plan when you finally downgrade into a smaller home.

2. Built up home equity can also be used for putting money down toward your next home.

3. Prolonged home ownerships brings with it equity growth in the form of debt reduction and general inflation.

4. Even if the market starts declining, history tells us that this will only be short-lived, and the market will start increasing again.

5. By using your income to pay off your mortgage, your income is in effect working for you. The opposite is true with renting.

6. One of the biggest benefits to having a mortgage is that, in most cases, the interest portion of your mortgage payment is tax deductible, which can save you a lot of money every year.

Making the decision to invest in such a way is never going to be easy, but by looking sensibly at the market, and by really considering whether the advantages above apply to your specific situation, you are able to make a more informed decision!

It’s a ‘Buyer’s Market’ so jump in and get a great house that you own for the same amount you are renting! The dreaded down payment has deterred many qualified buyers. Coming up with a down payment can be the hardest part of affording a new house, especially if this is your first home. The good news is that there are more than just a couple of ways you can do this. We’ll take you through the top 10 ways, according to MSN.com, that will enable you to come up with that down payment!

1. Ask for help. Parents, friends and relatives may all be willing to give you a loan with favorable rates – with parents, that often means no interest rate, and no strict timeframe. If a loan (or gift) doesn’t seem feasible, maybe they would be willing to co-sign the loan.

2. Use your other assets – either by selling them, or by borrowing money against them. This can include things like cars, boats or bicycles, as well as stocks, or trinkets, such as heirlooms, or vintage trading cards.

3. If you have life insurance with any built-up value, you could cash in that value, or possibly borrow against it.

4. If you are a first-time homebuyer, you can take out $10,000 from your IRA, penalty-free, to put toward your home purchase.

5. You can also borrow against your retirement funds.

6. Sometimes you can get help from a non-profit organization, such as a church. There are loans out there that will let you put a lower down payment down, as long as a non-profit organization puts in part.

7. Increase your income by getting a second job or doing some freelance work (such as cleaning houses…)

8. If you can make it work, change your withholding taxes in anticipation of being able to deduct the interest. This will give you more take-home pay, which you can start saving!

9. Offer to give something other than cash for the down-payment. This could include offering the seller something like a car or a boat in lieu of the down payment, or it could be your services; for example, you could offer to do landscaping in the person’s new home, or give them automobile services, or do their taxes! (For the record, I don’t necessarily concur with this method. Unless the seller is carrying the note, this is a mute point…unless you’re talking about the closing costs.)

10. Finally, you can look for options that don’t require a large down payment. Such options include loan programs such as VA or FHA. Another option is to purchase a foreclosure property, which can often be had with little or no down payment. You can also consider getting an 80:20 loan, where you essentially have two loans; one is the regular mortgage on the property, and the other is a loan for the down payment – even through these are separate loans, they often come from the same lender.

The most important tip is to ask questions! As they say, the only dumb question is the one that didn’t get asked. There have been so many changes in the mortgage industry over the past 6 months. Go to a trusted financial resource or lender and ask what programs are available. There are a lot more options than people are aware of! It can be scary to think you need to find thousands of dollars for a down payment, but hopefully one of the above methods will make things a little easier to face!

Today’s market has brought about the illusion that buyers hold all the cards and can offer whatever they “feel” is a good price for a house and that every seller should appreciate whatever they can get and be happy someone wants to buy their house. To all the buyers out there, “Control yourselves! Your ego may just possibly force you to lose a great new home for your family. You are not ‘king of the hill!” To all the sellers, “Hire a professional realtor who knows how to sell a house, listen to your realtor -it’s what they do for a living, and for the love of “Pete”-do not take offensive offers personally!”

With the market having such high inventory and either stagnant or declining prices, buyers are making ridiculously low offers to the point that it offends the seller so much that the seller won’t even counter on principle alone or they counter back at full price. I’ve seen it over and over again and whether you agree with it or not, it is a FACT. Some sellers get so ticked off that they refuse to even sell the house to the inquiring buyer at all. Again, this is not made up material for a good article, it is really happening!

First and foremost, when looking for your next home, you should hire a professional realtor. There are several benefits in it for you, and you don’t pay the realtor. We are in the business of managing the biggest asset that most people own on a day to day basis. We are experts in negotiations, real estate laws and the transaction process which could quickly turn sour if you don’t have someone looking out for your best interests and who knows which questions to ask and what to watch out for. If you don’t have one yet, call me!

Determine the seller’s motivation. As a realtor, I know how to expertly get this information with stealth like precision. As a third party who is not emotionally involved, I can see things clearer. And, I will ask the seller’s realtor a myriad of questions and then listen closely for clues to their individual situation. Such as ….the seller has already purchased another home, the house has been on the market over the average days on market for the neighborhood, their relocating to another state…..etc.. All of these things are key factors to their level of motivation to sell.

Explain your offer. I have often included a cover letter explaining my reason and/or my client’s reason for coming up with that number. Sometimes, having the buyer actually write a letter to the seller making their point is a positive step. They can express their interest in the home, the positive aspects that make them want to make it their home and also their concerns about the market conditions and dropping values… I recently made an offer on a house that was in an estate sale and needed a ton of improvements. I wrote the letter to the listing agent about how our intention was to fix it up and sell it right away. With that said, the only way we could possibly buy the house after calculating the estimated costs of improvement, would be to get it at XYZ price and that we had no intention of offending the owner’s family….but if they wanted to get rid of it immediately, we could pay cash and close in 2 weeks. It worked.

Prepare yourself for rejection or heavy negotiating. This is where your realtor can offer a TON of value to you. We can negotiate hard enough to get the very best price the seller will offer, but not so much that we will tick the seller off. I always try to verbally discuss the offer price and situation with the seller’s realtor. I guess it’s that “good ‘ol boy” philosophy of doing business with a handshake. I have had positive results when the other realtor and I can talk through an offer before getting it finalized on paper. It keeps it personal and there are certain things you just can’t convey on a piece of paper, such as the client’s good intentions and genuine nature.

“Believe there is a great power silently working all things for good, behave yourself and never mind the rest.” -Beatrix Potter

Breathe New Life Into Your Home!

A new year brings plenty of opportunities for new beginnings, so why not give your home one? Whether you are about to put your house on the market or are just a bit bored with your surroundings, some simple changes can make a world of difference.

Slap on Some Paint
Try something different and stay away from boring beige or wimpy white. Or, at the very least, use the more muted colors with vibrant accent colors on one or two walls. “We’ve gone through an era of everything being very muted and quiet and what we see with the younger generation coming up is that we’re really going to use lots of colors,” says Dixie Lovejoy, owner of Arizona’s Apple Interior Systems, Inc. “Colors on the walls, color on the furniture, such as lime greens, browns, oranges and bright reds.”

A fresh coat of paint will give your home an instant lift since it makes guests (or buyers) feel that your home is clean and well-kept. “Paint is a very inexpensive way to do something new and not have your house seem dated as time goes on,” Lovejoy explains.

Go Big or Go Home
When purchasing accessories, buy bigger and buy less. “People used to buy accessories on a very small scale,” says Lovejoy. “In our office, one of our slogans is: bigger is better.” She means that things like pots, vases, flower arrangements and fountains should all be larger. Replace a lot of knickknacks with one big focal piece. You will make a statement with your decorating rather than making your home look cluttered.

Pillow Talk
Accent pillows are a key home décor item that no home should be without. Pillows can tie together your home’s look, harmonizing colors from the painting above your fireplace with the antique wingback chair. “Accent pillows are kind of a key to all design that ties everything together,” Lovejoy says.

Sliding Away
Sliding glass doors and even French doors are disappearing in newer homes, says Lovejoy. Their replacements are doors that virtually vanish and allow greater access to the outdoors. Installing these doors can replace the eyesore that some sliding glass doors can be. “They actually can slide all the way into a pocket that’s built into the wall or stack on top of each other so it becomes one small window on the left or right side, but the rest of your house is all open,” explains Lovejoy.
Homeowners want more than the typical three-foot opening that French doors or sliding glass doors give. “The newest trend is opening up a 12 to 22 or 30 feet of glass,” says Lovejoy. “It gives you almost the lanai effect like you have in Hawaii where the inside and the outside all become one.” This look is ideal for homeowners who entertain a lot or host big events. These doors allow you to essentially merge the inside and the outside of your home.

The Outdoors Becomes the Indoors
Connected with this trend is the growing trend to decorate the outdoors like the indoors. Patios and decks with fireplaces, couches, chairs and even drapes and pictures are not uncommon and can blur the line between the inside and outside of your home. Today’s designers are incorporating big patterns into velvets and sheer materials on outdoor furniture that still holds up to the elements. These materials allow you to hose off your outdoor couch or chairs or vacuum them to remove dirt or stains.

With Flooring, Hard Is In
Carpeting is on the decline, says Lovejoy. Traditionally, homes have had carpeting in bedrooms and tile or wood in other areas. This is changing to homes that have hard flooring in all parts of the home to create a flow between the different areas of the home, as well as between the inside and outside. “That way, when you open up your house for entertaining, the patio or the lanai on the outside, or your sunroom, has the same surface as the house so you get that huge expanded feeling,” says Lovejoy.

Going hand in hand with this trend is the prominence of rugs. Of course homeowners want some soft areas in their homes, like near couches or beds.

If you need a referral for a quality, reliable painter, designer or other contractor, please contact Kelli!