Category Archives: Buyers

Want to Increase Your Net Worth? Buy a House

Financial security is important to all of us. You may think about it from the perspective of being able to take care of your family or the freedom to retire at a younger age or even just the comfort of knowing you have the security to care for yourself. Whatever your reason for wanting financial security, there are several ways to increase your net worth and bring you the financial peace you are looking for.

  1. Make more money. This may mean getting a second job, furthering your education to get a better job or asking for a raise if you have been in your current position for a while and have a good performance record.
  2. Spend less money. When you cut your expenses, you will be able to pay off debt faster and increase your savings. This will work two-fold to increase your net worth.
  3. Buy a house. Almost annually, a study is done to show the comparison between the net worth of homeowners and renters. A recent study revealed homeowners are worth more than 46 times more than renters. Why is this so? There are a couple reasons to consider. Homes are likely to appreciate while your mortgage stays the same. Over time, your home is very likely to appreciate in value. Even during an economic downturn, decreased values are most often temporary and will begin to rise again before too long. When your home value rises, your mortgage still stays the same. When the value of your rental rises, your landlord is likely to raise the amount of your rent to compensate for the change in value.

Another thing to think about is that when you pay your mortgage, you are able to recover most of that money (and sometimes even more due to appreciation) when you sell your home. When you rent a home, the money you spend can’t be recovered when you move out of your rental. You have just helped the landlord increase their net worth. Owning a home acts as a forced savings plan since you must pay your mortgage to keep the bank from foreclosing on you. With each month and year, you pay your mortgage, you are growing your equity in your home. Over time, your equity increases, and you are able to take advantage of that equity when you choose to sell your home. Assuming the value of your home has increased while you owned it coupled with your equity, you can see a nice return on homeownership with a little time.

Statistically, this makes a great case for homeownership but only you can decide what is right for you. If you don’t plan to stay in one area for a long time, this may not be the best time for you to buy a home. If you do plan to stay in one place for a while, it might be a good time to consider buying a home while increasing your net worth at the same time. If you have any additional questions or concerns about buying a home, I will be happy to answer any questions you may have, help you to find your dream home and/or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Image by Nattanan Kanchanaprat from Pixabay 

————————————————————————————————–

Design Inspiration for Your New Home

When you are moving into a new home, you may want an entirely new look to go along with that. Even if you are happy with most of your current furnishings and don’t need to change everything, a move may mean more space or different space that you need to furnish. If interior design isn’t one of your hobbies, where do you find ideas that will help you turn your house into a home. Start with these five sites to find lots of great ideas.

HGTV.com
HGTV is full of great ideas for everything house related. Ideas of all kinds can be found in whatever style you are looking for. From the front porch to the backyard and everything in between, HGTV is full of stunning ideas. Browse ideas by room or style until you find just the look for you.

Havenly.com
Havenly.com is the perfect option if you are never quite sure how to pull a room together. For a small fee, they will ask about your style and make recommendations that meet your budget and style. This is a great option if you don’t want to buy a prepackaged room of furniture and just can’t decide what goes together.

Houzz
This website brings together home professionals of all kinds to share ideas and experiences that you can search and brose until you find the right one for you. Whether you are looking for a fresh look for one room or the whole house, Houzz can make it easy to find.

Modsy.com
Modsy is another option to work with a designer for a small fee. They will provide design ideas within your budget then offer you discounted prices to purchase the items through them so you don’t have to track everything down yourself. They offer unlimited changes to their design recommendations and will keep working with you to get it right.

House Beautiful
The companion website to the magazine shares design ideas from a variety of sources. From whole designs to focus pieces to make a perfect statement, this site is full of ideas that you will love.

These sites are just a starting point to help you perfect your home to your style and needs. If the DIY approach to style isn’t for you, you can always call a local interior designer to help you style your home.  For additional information or recommendations to trusted professionals, please contact me today. I will be happy to answer any questions you may have, help you to find your dream home and/or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Image by BUMIPUTRA from Pixabay 

 _________________________________________________________________________________________

 

Avoid These Common Mistakes When Buying a Home

With interest rates at an all-time low, this is a great time to buy a home and take advantage of the low rates. Buying a home can be stressful but it doesn’t have to be. With the help of an experienced agent and a little effort to avoid common mistakes, buying a home can be a simple experience.

Hire an Agent
Don’t try to buy a home by yourself. No matter how many homes you have bought, there are lots of things that will need to happen when you are purchasing a home. From finding the property and making an offer to negotiations, inspections and closing, there are lots of things that can come up during this time. Don’t guess your way through. Work with an agent who knows how to work things out to your advantage.

Stick to Your Budget
When you are buying a house, there are many expenses that go into the process. It is important that you stick to your budget because you don’t want to stretch your finances to a point that you are uncomfortable. Start by talking with a mortgage lender who will evaluate your income and credit and give you a preapproval so you know how much you can spend. Their preapproval will be based on certain ratios that allow you to not devote too much of your monthly budget to housing needs.

Don’t Skip Inspections
If you are working with an agent, they will definitely advise you to do inspections on the property so you know what you are buying but even if you aren’t, inspections will help you understand the true conditions and facts of the property you are purchasing and can help you avoid being surprised by something you didn’t know after closing.

Have an Emergency Fund
If you don’t have an emergency fund, it may be a good idea to put buying a home on hold for a little while until you can save more money. When you purchase a home, it will be your responsibility and that means you need to have money to make repairs when something breaks. To give yourself some added protection related to the condition of the home, you might want to consider purchasing a home warranty that would cover some home systems if they failed.

Buying a home doesn’t have to be hard but with this advice and a great agent (pick me!), this can be an exciting time as you purchase a new home. For additional information on purchasing a home or the home buying process, I will be happy to answer any questions you may have, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

 Photo by Morning Brew on Unsplash

________________________________________________________

Virtual House Hunting

The buzz word virtual is attached to everything today. Virtual learning, virtual meetings, virtual shopping and now virtual house hunting. Sure, there are a few things that you really can’t do virtually but with the Coronavirus pandemic, people have figured out unique ways to adapt almost any situation and searching for a new home is no different. Here are some ways you can expect to search for a new home with virtual tools.

Virtual tours are common to find on homes for sale but have seen significant updates in recent years. It is now common in many price ranges to find 3D tours that incorporate a floor plan of the house with photos and walk you through the home step by step. These tours allow you to feel like you are walking through the home from the comfort of your computer or smartphone. While a tour like this may not make you 100% sure the home is for you, if you don’t like the 3D tour, you will likely be able to eliminate the home from consideration and not need to see it in person.

Another issue with home searches now is that you may be moving to a new area but unable to travel. Once you have viewed any tours available for the properties you are interested in and narrowed down the search to your top choices, your agent can schedule appointments to view the properties and connect with you over Facetime or Skype to allow you to walk through the property with them. Since your connection will be live, you can ask questions and the agent can go through the home at your own pace and show you any area you want to see. This is a great option if you are unable or uncomfortable with viewing the home in person at this time.

Working with an agent who is familiar with the latest technology will make it easier for you to purchase a home at this time. After you select a home you would like to make an offer on, I will prepare the contract and send to you for electronic signatures so there is no risk during signing. While the property is under contract, the home inspection will still need to take place but the inspector can share information with you after the inspection so you can review any issues.

If you have purchased a home before, this may be a little different than your last experience, but it doesn’t have to be scary or overwhelming. I will work with you each step of the way to make sure you are comfortable and understand everything that is going on and are ready to move forward. For additional information on purchasing a home or the home buying process, I will be happy to answer any questions you may have, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Photo by Vlada Karpovich from Pexels

___________________________________________________________________

Buying a Home? Don’t be Surprised by These Extra Expenses

When you are buying a home, you are fixated on one price and that is the big one that you may be paying for over the next 30 years. While that is definitely the most important price, don’t let that be the only thing you think about. There are many other expenses you will encounter when purchasing a home and they could add up significantly. If you haven’t budgeted for extra items, don’t let them sneak up on you and cause your household budget to become unrealistic. Don’t be surprised by the necessary expenses you will encounter throughout the home buying process.

Here are some of the additional expenses you should expect when you buy a home. Take these expenses into account before you buy so you aren’t surprised by them at closing.

Closing costs. Closing costs are part of every home transaction and can add up to thousands of dollars on top of the price of your home. In some cases, your lender may allow you to finance some of your closing costs along with the purchase price of the home and you may also negotiate with the seller to pay a portion of your closing costs as part of the contract. Either way, expect closing costs to total 2% to 4% of the price of your home.

Taxes and insurance. Real estate taxes vary greatly depending on the value of your property and the tax rate where you live. While property taxes are frequently paid via your escrow account and therefore added to your monthly mortgage payment, this will increase your monthly payment and may push that payment beyond an amount you are comfortable with. Insurance will also be added to your escrow account so don’t forget it either. You will definitely need homeowner’s insurance and could need other coverage depending on the location of your home. Make sure your monthly payment leaves room for these items.

Homeowners association fees, condo fees, and utilities. HOA and condo fees are normally paid by your landlord when you rent, as are many utilities such as water and garbage. You will be responsible for them once you own your home. Be sure you have room in your monthly budget for these expenses.

These extra costs can add up, but don’t let them scare you off from buying your own home. As long as you budget for these added expenses before you buy, you won’t have to worry about getting in over your head.

Even if you aren’t buying your first home, it’s easy to forget about some of these items when you get excited about a new home. Take a little time to plan your household budget before you get too far into the homebuying process, so you aren’t surprised by anything after you fall in love with your new home. For additional information on purchasing a home or the home buying process, I will be happy to answer any questions you may have, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Photo by Alexander Mils on Unsplash

_______________________________________________________

Condo vs Townhouse… What’s the Difference?

If you are thinking about buying real estate, there are many different types of properties to choose from. Many different factors will help you determine the kind of property that is best for you. Start by thinking about your lifestyle along with your interests, budget, where you plan to live along with your wants and needs.

You may be considering a property that is attached to others. There are different kinds of properties that fall into this category, but the most common types are condominiums and townhouses or townhomes. If you are exploring your options in attached dwellings, you may wonder what is the difference? Here are the things you need to know when it comes time to pick between condo and townhouse.

While many people think they know the difference in condos and townhouses, chances are you may be mistaken. Condos and townhouses are not distinguished by the architecture of the structure but by the ownership of the residence. In both condos and townhouses, the units are attached to others and will have some shared areas even if it is only a wall. With condos, you will own your individual unit plus you share ownership of the building and common areas with the other owners in the building.

When purchasing a townhome, you will own your individual unit plus you also own the land the unit sits on. There will also be some kind of an HOA that manages the common areas and the exteriors of the building and the property. These terms are sometimes used interchangeably by people though they may not be using them correctly. If you are looking for an attached dwelling to buy, make sure you understand the pros and cons of each style and compare them to your wants and needs to help you decide what will be best for you. In some cases, townhouse style properties are technically condos due to the lack of land ownership that comes with the purchase.

When you are weighing your options, make sure to consider cost, who will be responsible for maintenance and repairs on the exterior and common areas and the available amenities. Many people are drawn to condos and townhouses because they are able to enjoy the benefits of ownership without the full-time responsibility for maintaining all aspects of the property though they will still be responsible for covering the cost of the maintenance. For additional information on knowing the difference between condos and townhomes, I will be happy to answer any questions you may have, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Image by F. Muhammad from Pixabay 

___________________________________________________________________________

What’s a Contingency?

When you are buying a house, there are a lot of things you will have to consider and in many cases you will want certain things to happen before you decide to move forward with buying a house. Situations like these are the benefits of a contingency. A contingency allows you to delay an action until something else happens or doesn’t happen. With home buying, there are many cases where this might be a helpful. Here are a few ways you could benefit from a contingency when you are buying a home.

If you are planning to buy a new home but you have a home to sell, a contingency can be extremely beneficial. You may make an offer on a new home that is contingent upon your current home selling. In this case, you would be allowed a certain amount of time for your home to sell so you can move forward with buying the new home. If your home doesn’t sell in that time frame, the home would go back on the market or you could choose to buy it without selling your current home if you have the resources to do so. This can be beneficial if there is a home you really like that you don’t want to get away from you while your home is for sale. In a seller’s market, sellers may be less likely to accept this option, but it never hurts to ask.

Another contingency that might come up in your home purchase is a financing contingency. This allows you to say the home must appraise for a certain amount or that you must be able to get a loan for the property or you won’t buy it. These contingencies are great ways to protect yourself from being forced to purchase a home that is worth less than you expected or that the lender doesn’t agree to make a loan on. While you can’t technically be forced to purchase a home if you change your mind, there may be penalties for not moving forward with the purchase of the home you have a contract on. These contingencies will protect you from that.

Inspection contingencies are another type of contingency in a sales contract. This allows you time to investigate the condition of the property to make sure it meets your expectations. If a home doesn’t meet your expectations or has major flaws, you will be allowed a certain amount of time to change your mind about purchasing it without a penalty. In some cases, you may find something wrong with the house and the seller agrees to repair it so you will move forward and that is ok too but this contingency will protect you so you aren’t penalized if you and the seller don’t agree.

In the end, contingencies are designed to provide you with protection in the event you choose not to complete a purchase, or you are not able to do so. Without such contingencies built into the sales contract, you could lose your earnest money deposit or even be sued for nonperformance in some cases.  If you have any additional questions about buying a home, I will be happy to answer any questions you may have, help you to find your dream home and/or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Image by Kirk Fisher from Pixabay 

————————————————————————————-

What to Know About an Appraisal Report

Without an appraisal on your home, most lenders will not even consider making a loan. An expert opinion of value is required before they will allow a property to serve as collateral. Usually the appraisal is ordered by the lender from an independent appraisal company, but it’s not unheard of for the homeowner to order an appraisal for a variety of reasons including insurance purposes.

Fannie Mae Form 1004 or Uniform Residential Appraisal Report is the most common form of residential appraisal.  This form is used when the lender or homeowner requests a “full appraisal” since it requires an interior and exterior inspection.

Learning how to read an appraisal report will help you understand how the appraiser arrived at his opinion of value.

The first section of a Uniform Residential Appraisal Report will identify the property and detail any improvements on the property. There are a variety of ways to identify the property such as property address and legal description. In addition to identifying the property, there will be sections describing the neighborhood and your home in detail. Comparable properties can be found and evaluated after the appraiser identifies the characteristics of the appraised property.

Section two contains the chart listing all the comparables and the adjustments. Essentially, the second page is a way for an appraiser to “show his work” and justify his opinion of market value. In most cases, the comparables will be sales from within the last six months and within a half-mile radius of the subject property. This prevents the need for the appraiser to make any significant adjustments based on time and neighborhood.

The values of the comparables begin as the listed sales prices, and those values will be adjusted based on how they compare to the subject property. The gross adjustments will then be added or subtracted from the sales prices to arrive at the adjusted values. The appraiser then uses these adjusted values to arrive at his opinion of the subject property’s market value. A lender may not accept the appraisal If the gross adjustment is too high.

An appraiser may also provide an income value and cost value. The income approach is used to evaluate the estimated value of income producing properties such as rental homes, and the cost approach is normally used to estimate replacement costs for insurance purposes.

Additional pages of the appraisal will include supporting documents such as photos of the subject property and surrounding neighborhood, sketches of the subject property, any contracts that were considered during the appraisal process and copies of any other pertinent documents.

Understanding how to read a Uniform Residential Appraisal Report will help you to spot any potential mistakes and have the peace of mind that the appraisal is accurate, as well as to bring them to the lender’s attention before they become an issue. Contact me for a consultation. I’m happy to answer any questions you may have about buying or selling a home, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Photo courtesy of jarmoluk/Pixabay.com

_______________________________________________________________________

Fixture vs Personal Property – What Stays and What Goes

When you are buying a new house, you will need to understand the difference in fixtures and personal property. A fixture is part of the house and will stay with the house when you sell it. Personal property will not stay with the home and the seller of the home should take all personal property with them. The most common fixtures in a home are built-in appliances but also frequently include window treatments, blinds and pool equipment. When you are looking at houses, how do you know what will be yours if you buy the house and what will go with the current owners of the home? Here are three questions to ask yourself to help you determine if it will stay or go?

  1. Is the item permanently attached to the house? Dishwashers and stoves are normally attached to the property in some way unlike a refrigerator, washer and dryer that are just plugged in. Consider window treatments. Blinds are most likely attached to the house as are some window treatments. However, a curtain rod may be attached while the curtain itself is just hanging from the rod meaning the curtain rod would stay and the curtain would go. Ceiling fans, light fixtures and built-in shelving are generally fixtures. Landscaping and fencing will also generally be expected to stay.
  1. Is it a furnishing instead of a fixture? Common furnishings are furniture, electronics, rugs, potted plants and flowers and grills. These items are most often not attached to the house in any way and can just be picked up and moved to a new location. If the home has an outdoor kitchen, look at how things are affixed. A grill that is sitting on the patio is different than a grill that is built into an outdoor kitchen or installed in the ground and attached to natural gas.
  1. What is the seller’s intent? Don’t be afraid to ask questions. Some home furnishings may be negotiable or due to the seller’s circumstances they may be willing to leave something. Did they have something custom made to fit in the house or curtains that coordinate with the wallpaper in the living room? If items really make the house and are unique enough that they aren’t likely to work in other properties, they may be willing to leave them. Another option is to request some personal property as part of your offer to purchase or offer to buy it from them. If you are moving in a house for the first time and don’t have everything you need or just really like the way the home is furnished, this is an option that may help you get settled in your new home faster.

Knowing what stays and what goes can be a tough question, but it is something your agent will be able to help you answer. For additional information regarding the home buying process, I will be happy to answer any questions you may have, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Photo by Douglas Sheppard on Unsplash

________________________________________________________________________

What is PITI?

When you are buying a house, there will likely be many things you don’t know even if it isn’t your first time buying a house. Don’t let this discourage you. Just ask questions of your real estate agent so you can be sure to understand exactly what is happening. Early in the home buying process, you are likely to hear your mortgage lender and your real estate agent mention PITI. What in the world does this have to do with buying a house? PITI is an acronym for your mortgage payment that includes Principal, Interest, Taxes and Insurance. This is commonly referred to during the mortgage application process as your lender is determining your credit ratios and making sure your income and loan amounts fall within their underwriting guidelines.

When your mortgage lender is calculating your PITI, the yearly amount of money to cover taxes and insurance on your home are put into escrow and divided by twelve, then added to the principal and interest to make up your total mortgage payment. The “P” in the acronym refers to the principal of the mortgage.  This is the total amount of money borrowed from the lender to make your monthly payments.  With each payment made, a portion of the principal is paid off and there is a gradual decrease in the outstanding balance owed.  Over the life of the mortgage, the principal component of each payment towards the outstanding balance starts out very small and gradually increases so you are paying more money toward the principal each month. As the principal payment amount slowly increases with each payment, the equity in your home increases.

The first “I” in PITI stands for interest and is a charge from the lender in order to borrow the money to purchase your home.  Initially, the largest part of your mortgage payment will go towards the payment of interest.  There are a variety of interest types yielding a variety of rates.  Your lender will assist you in determining which interest type and rate is best for your needs.

Taxes “T” are the next section of the PITI acronym.  These are property taxes that will be paid to the county and city where your property is located. First, the property is given a market value which is determined based on the assessed value of your home and paid into your mortgage’s escrow account each month so your lender can pay it when your taxes are due. The tax on market value can change based on any new property reassessments.  However, major home improvements, such as home additions, will trigger a reassessment consequently increasing the tax levied dependent on the added market value.

The final “I” in PITI represents your homeowner’s insurance cost. This insurance is important to both the homeowner and the lender.  As the homeowner, you are protecting your investment from fire and other disasters. The lender is utilizing the insurance to protect their investment of lending you the money.  The insurance guarantees repayment of their loan should any calamity threaten their collateral.  In the majority of cases, lenders require homeowner’s insurance to be carried as a condition of the mortgage.  There are multiple carriers of homeowner’s insurance, thus shopping around for rates is highly recommended.

All of these items together total your PITI and will make up your mortgage payment each month. When you are applying for a mortgage, your lender will let you know this amount, so you know what to anticipate your mortgage payment to be each month. For additional information, reliable recommendations to trusted affiliates or to arrange a meeting to discuss your needs, please contact me today for a consultation. I will be happy to answer any questions you may have about the home buying or selling process, help you to find your dream home or determine the value of your existing property.

 

Nancy Davidson
Mammoth Village Properties
760 937-2301 mobile
nancy@mammothcountry.com
www.MammothCountry.com
CA Broker’s License #01264041

Nancy Davidson is your ultimate real estate resource for Mammoth Lakes, CA and The Eastern Sierra. Visit my website for detailed information regarding today’s real estate markets.

Image by OpenClipart-Vectors from Pixabay 

——————————————————————————————————————–