Whether you want to be environmentally conscious or just save some money, reducing your energy consumption is never a bad idea. There are a few simple things you can do right now to start seeing lower numbers on your energy bills each month:
Install (and use) energy efficient appliances
Using Energy STAR-certified appliances will save on your electric bill and your water bill. Nearly all appliances on the market today are Energy STAR certified, which means they are designed by the Environmental Protection Agency as being energy efficient.
Buying a new washer, dryer, refrigerator, or dishwasher will be an initial investment up front, but these appliances will eventually pay for themselves through the savings each month. As a bonus, using a dishwasher in general is much more energy efficient than washing dishes by hand.
Remove phantom loads
Did you know that your appliances, electronics, and other items in electrical outlets continue to draw electricity even when they are not turned on? In fact, they use up to 75 percent of their overall power to keep clocks, timers, and other settings functioning.
Simply unplug anything you do not need when it’s not in use and watch your energy bill drop. Amp up the savings even more by combining electronics in a power strip and turning everything off at once.
Fill your fridge and freezer
This might seem counterintuitive, but your refrigerator and freezer actually run more efficiently when they are full. Food and other items act as insulation to keep the entire space cold, which means less time that the appliance has to run.
Look at this as an opportunity to buy in bulk if you can and save a little money on your grocery bill, too. If that’s not an option for you, don’t go out and buy unneeded items just to save space. Instead, add bags of ice to the freezer or containers of water to the fridge to take up the extra room.
When you finally find the home of your dreams, it can be easy to put blinders on and ignore warning signs that might be right in front of you. Those red flags may not be so clear for an undiscerning eye to detect!
Either way, there are a few common problems that should be enough to give pause to any prospective homebuyer. These are not necessarily deal breakers, but definitely things to keep in mind as you are weighing the pros and cons of a new home.
DIY Gone Wrong
In an effort to save money before putting their home on the market, some sellers take on do-it- yourself projects that don’t always end well. These projects can end up costing you a lot of time and effort to undo the substandard work and replace it with a better solution.
These types of projects most commonly occur on outdoor decks and home additions. If anything looks questionable, make sure to ask about it during the home inspection and request copies of the permits used to complete the work.
Mold or Water Damage
This is another area that can end up costing a ton of money to repair if not noticed before a home is sold. Look for places on the walls or ceiling that look like they’ve recently been patched or replaced.
Foggy windows are another telltale sign of moisture problems in a home. Check them for condensation and ask the seller or your home inspector about anything questionable that you see.
Keeping Up with the Joneses
Beyond the house itself, the state of a home’s neighborhood says a lot about whether it’s a place you want to live. Are the lawns well maintained? If there’s a holiday coming up, are the homes decorated to reflect it?
These might seem like trivial things, but your dream home can turn into anything but that if your neighbors are not hospitable. Your home’s value can also decrease based on a lack of curb appeal in the neighborhood, especially in a weak housing market.
Many do not take advantage of home tax deductions. Tax advisors will tell you this is because homeowners aren’t even aware that these deductions exist.
Homeowners can claim several write-offs that will lower their taxes.
You and your spouse can deduct for mortgage interest payments up to a millions dollars. Your mortgage debt must be secured. Both first and second home qualify.
1. Mortgage Points
Mortgage lenders often use a point system. One point equates to 1% of the principal of your home loan. These fees are often one to three percent of the home loan. The fees are tax deductible as long as they are part of the process of purchasing a home. Refinancing your home the points are also fully deductible, but not up front. Refinancing points’ fees can write off over time and in conjunction with the remainder of your old points.
2. Profits on Selling Your House
If you sell your house, depending on your personal circumstances, you may not have to pay taxes on the profit. If you’ve had the house for less than a year, you could write off expenses you didn't even pay. Checking with a tax consultant can often save you significant sums.
3. Property Taxes
Turbo Tax accountants points out that a homeowner is legally allowed to deduct the total second home's mortgage interest on mortgages of a maximum of $1.1 million as long as this is not a rental property. As well, all property taxes are deductible.
The situation changes if this second home is rented out. If the property is rented for fourteen days or less annually, the rental income does not have to be declared. If it is rented for more than fourteen days, the rent must be declared for the year.
However, if the rent must be declared because it was rented for fourteen or more days, the owner can claim such rental expenses as: mortgage interest, property taxes, insurance, property management fees, utilities, and half of the depreciation.
4. Boats loan interests
Do you have a boat? If it has eating, sleeping, and bathroom facilities, it may qualify as a first or second home. You could deduct mortgage interest paid on the loan for the purchase of your boat. Check this out with a tax consultant.
5. Home Depreciation
You may be able to claim depreciation on your home. There is a variety of ways that home depreciation may be claimed. However, the exact situations are dictated by specific legal situation. In this circumstance, you should consult with a tax professional, but be sure to tell them if you have claimed depreciation on a home you sold.
It’s great to have friends and family visit from out of town, but the days leading up to that visit are often stressful as you realize that your house is not ready for other people to see.
Your house is not a hotel, and your guests probably are not expecting perfection, but that does not mean you should skimp on cleaning and other tasks to get your home organized. Here are a few easy things you can do for maximum return on your investment of time and energy.
Make a Fresh Bed
There’s nothing quite like the feeling of getting into a fresh, clean bed, especially after a long day of traveling. The last thing you want is for your guests to find themselves in a bed with dirty or musty sheets.
You should always strip the guest bed or beds a day or two before your company arrives and make sure it is freshly made for their first night. Even if no one has slept in the bed since you last washed the sheets, they can pick up whatever smells are in your house and lose that fresh feeling over time.
The arrival of visitors is a great time to remove some of the junk that tends to build up around the house. This includes everything from stacks of unopened junk mail to the clothes you’ve been meaning to donate to kids toys that never seem to get put away.
Effective decluttering does not mean shoving everything into a closet or other out of the way place. Instead, separate items into things that you want to keep, things you want to donate, and things you want to throw away. Then make a plan for getting rid of whatever you are not going to keep.
Set the Temperature
Consider whether your guests’ temperature preferences may differ from yours and adjust your thermostat accordingly. You’ll need to do this at least a few hours ahead of their arrival in order for the temperature to adjust as needed.
As an extra courtesy, set out extra blankets in the bedroom if it’s cold, or place a fan in the guest room if it’s hot. That way, your guests will have the ability to control the temperature beyond what you set.
Are your kitchen cupboards a hodgepodge of items you haven’t used in a year? Are the can goods mixed in with boxes of chocolate pudding? Do you have to search for the items you want? Is the counter littered with small appliances and cooking utensils?
If this describes your kitchen then perhaps it is time to declutter.
Before you begin, get your mind and your kitchen ready for a big clean up. Clear the countertops. Empty the dishwasher. Fill your sink with hot soapy water ready to make long-unused glassware, pans, and dishes sparkle before putting them back in the cupboard.
For decluttering, use a three-box method of sorting:
Box #1: things I am still using. These will go back into the cupboard in an organized manner after I have scrubbed and/or relined the shelves with adhesive shelf paper available at any dollar store.
Box #2: things that are still good and not past their expirationdates. These can be donated to a food bank or soup kitchen, as I do not use them anymore.
Box #3: past their expiration dates, these items are destined for the garbage.
The same goes for small appliances, pots and pans, dishes, glassware, and wall decorations. Donate or store under the counter. Get the clutter off the counters.
Next, attack those drawers of cutlery and old recipe books. Use the three box method on them. Be relentless. If you haven’t used it in a year, out it goes. You don’t need five can openers and three corkscrews. Keep the good one and throw out or donate the others.
An efficient kitchen is one that is pared to the bone. Those expired coupons and seldom-used cookbookshave to go out with the bag of catsup and mustard packets.
Pace yourself. Do a cupboard a day or a drawer a day rather than rushing through your kitchen de-cluttering. Don’t forget those appliances. Use the three box method on the contents of your fridge. Scour shelves and make your fridge and stove sparkle inside and out.
Next attack that “junk drawer”. We all have one! Resist the urge to keep something because you “might need it someday.” Organize what you do keep in a plastic tray.
Is this a one-day job? For some it is. For others, slow and steady a section at a time is the way to go. It all depends on your energy, your available time, and your personality.
Buying a home is about much more than the listing price. From taxes to insurance, there are several things you’ll be expected to pay that you might not realize. Planning for them now will help you avoid adding more stress to the process or encountering a surprise once you sign on the dotted line.
Property taxes are a necessary evil for all homeowners. They are used to fund local schools and a variety of other government programs and services in the city or town where your home is located.
The tax rate is set by your state and is calculated annually based on your home’s assessed value. Funds are typically taken out of an escrow account that you establish when you buy a home, so you might not even know that they are happening.
Much like car insurance protects your vehicle in the case of an accident, homeowners insurance does the same thing for your house in the event of a natural disaster, fire, or other event that damages your property.
Like property taxes, the cost varies based on where you live and how disaster-prone the area is. You might be able to save a little money by bundling your homeowners insurance with your car insurance or life insurance through the same company.
Private Mortgage Interest (PMI)
PMI is required for anyone who buys a home with a down payment less than 20 percent — which, let’s face it, is most homebuyers these days. It protects the bank or mortgage lender in the event that you default on the loan.
Paying a few hundred extra dollars per month might seem like a nuisance, but it can pay off in the long run if you make a worthwhile investment on your home.
This one seems simple but is worth mentioning as a reminder. As a homeowner, you will be responsible for all of your utilities (water, electricity, heating, etc.) and associated bills like Internet and cable.
Chances are, your new home is larger than where you lived previously, so plan to have some wiggle room in your budget until you see how things play out in your new space.
Homeowners Association (HOA) Fees
Finally, if your new home is part of a community with a homeowners association, you’ll need to pay the associated HOA fees. These fees range from a few hundred to a few thousand dollars per month and most commonly cover maintenance of the community’s common areas — lawn care, snow removal, etc.
In some higher-priced communities, HOA fees may also cover community event spaces or even things like on-site fitness facilities. Again, it’s important to know what these fees are upfront so you can work them into your budget and leave some wiggle room to enjoy your new home!
Real estate agents are in the business of selling homes. While you might only move a handful of times over the course of your life, an agent sells dozens, if not hundreds, of homes per year.
Knowing and understanding what motivates a real estate agent will help you work more effectively with one in the future. Here are five things to keep in mind:
It’s About the Bottom Line
Most real estate agents work on commission, which means they only get paid when a house is bought or sold. Good agents will be attuned to your emotional needs around the process, but at the end of the day, they have a job to do. Don’t expect an agent to work for free or do things outside the scope of what you are paying for.
Agents are Advertisers
An agent’s job is to sell your home, but also to sell themselves to future homebuyers. If they do not have a steady stream of clients, they are not making money and referrals are everything in the real estate business. Your agent may ask you for a recommendation or other assistance in landing future clients if your sale is successful.
Making (and Keeping) Appointments
Real estate agents often juggle multiple clients and listings at the same time. Trying to work around everyone’s schedules for showings, inspections, and other meetings can be difficult. Keep all appointments that you make with your agent and let them know as soon as possible if you need to reschedule.
Real estate agents know the areas and the markets they work in better than anyone. Trust their advice about pricing and other tactics that may be helpful in closing a deal — even if it seems counterintuitive to you.
Know When to Walk Away
Finally, remember that there are plenty of fish in the sea when it comes to real estate agents. If you find that your first choice is not working for you, don’t be afraid to seek other options. Working with an agent that’s a good fit for you will lead to a better experience and a more lucrative deal in the long run.
More than 50 million Americans today live in condominiums, homeowner associations, cooperatives and other planned communities. Being part of a community association offers homeowners many benefits and amenities, but is something to consider before buying a home or estate within a gated community.
A Homeowners Association (HOA), is a legal entity created to maintain common areas. These are often the most affordable way to own a home, especially for first-time homebuyers. When deciding whether to enter into one of these "gated communities" you should make the following considerations.
1. The first thing to ask is whether the home that catching your eye is part of a community association. If so, your real estate agent will obtain copies of the governing documents Covenants, Conditions and Restrictions (CC&R), for you to read through carefully.
2. Recognize that member homeowners agree to comply with all governing documents. In tangible terms, these rules apply to architectural guidelines like additions, decks and paint colors, landscaping, maintenance, satellite dishes, fences, parking, pets and more.
3. Get a visual of how these rules and restrictions are actualized within the community by taking a stroll through the neighborhood. Pay attention to how the common grounds are maintained, what parking is like, and what conditions the homes are in.
4. Ask to talk to a member of the elected board or the president of the association. They will be able to give you reasoning behind the governing documents and answer any questions about how they would apply to you. Also talk to people who live in the community. Find out how they feel about abiding by their community's rules and restrictions.
5. Examine the association budget carefully. This budget sets the level of assessments and services available to the entire community. Understand that these assessments are mandatory homeowner dues that must be paid or you risk legal action taken against your property. Look for a reserve fund within the budget that will cover major expenditures, like roof replacements or the resurfacing of private roads. If there is not a reserve fund, then the association will likely impose special assessments on member households - a potentially expensive, unanticipated expense.
6. After examining the CC&R and budget, make sure the home you are looking to buy is not already out of compliance with HOA rules. Failing to do so can result in larger, more expensive issues down the road.
7. If you are environmentally conscious, assess the environmental practices stated in the CC&R. Some communities require the use of fertilizers, pesticides, sprinkler systems and other tools to keep your property in line with community standards.
8. Ultimately, be realistic. Homeowner associations have many benefits and advantages, such as well maintained public spaces and stronger communities. However these associations face the difficult task of pleasing all participating members. This includes potentially controversial community issues, which ultimately requires judgement and decision-making by the elected officials. Ask yourself how you will react when given rules that you do not particularly like or enjoy.
The most important question is whether this is, at its core, the right community for you and your family. Does it fit your lifestyle? Do you have access to your desired amenities? Is it a good investment?
When you have finally found your desired community, get involved! Only by getting involved within your community can you have a voice in any community-wide decisions. This is possible by attending board meetings, serving on a committee or even the association board. In the end, it is your investment, your community and your home.
Home inspections are one of the most critical steps in the home buying process, and for many reasons. Investing in a home inspection can protect you from unexpected costs before you buy, as well as save you money in the long run on your investment.
Not only is it important to know what will happen during a home inspection, but just as important to know what will not happen and how to interpret the results.
Not all home inspectors are created equal, so check certifications and chose someone who is part of the American Society of Home Inspectors and is an ACI (or ASHI) certified inspector. Even the best inspectors can make mistakes, so chose one who carries "Errors and Omissions" coverage that goes beyond the basic liability insurance. Don't choose an inspector for the wrong reasons.
Attend the inspection and don't leave the inspectors side, as you will likely pick up additional insight along the way and better understand the final report. While most inspectors in California follow the National Association of Certified Home Inspections guidelines, there is no uniform checklist. So be sure to negotiate ahead of time what is included on your checklist and understand what is potentially not included, such as items not on the house (fences, surrounding buildings, pipes and septic tanks). Know that Asbestos, lead, mold and other dangers are typically not covered. Understand how thorough the inspection was, like if the inspector climbed on the roof or entered the basement, and how they evaluated the roof and foundation.
Inspectors are not psychics
A home inspection can only go so far. Inspectors can't see the future and don't know when housing systems will fail – they can only evaluate present conditions. Most home inspections are also non-invasive – meaning they only inspect beyond finished surfaces – so protect yourself as much as possible. Many of the most expensive repairs, such as water leaks and damage, rotted wood and faulty wiring or plumbing, are behind the walls and under floor coverings. A trusted inspector can notice defects and if homeowners are trying to cover up problems.
One of the biggest decisions we have to make in our lives is whether we should buy or rent our next home. This begs the age old question, is buying cheaper than renting? With interest rates lower than ever, now is the time to consider pulling the trigger on your next home.
As home prices have started to rebound at around 2% over the last year, rental prices in the top 100 major US cities have gone up over 4%. This means that on average you could save $700 or more per month on a mortgage as opposed to renting if you stay in your home for at least 7 years. The main reason for this is that mortgage rates are around 1% lower than the previous year. But before you go gung-ho and run to your local real estate agent, there are a few things that you must first verify before you can officially say that buying is cheaper than renting.
The first thing you need to consider is if you can qualify for the best mortgage rates. If your income or credit score cannot get the best rates available, then buying may not be the cheapest option for you just yet. Another major concern you should have is what tax bracket you are in and whether you itemize your deductions. The third and no less important thing to consider is how long you intend to stay in your home. You should consider staying in your new home for at least 7 years which a safe amount of time to build enough equity in the home to overcome the interest you have to pay on the house.
You may be asking, “What if I don’t qualify for the best rates, or don't itemize my deductions?” Your cost of home ownership may go up because of these factors. Buying may still be a great option for you with many benefits to your life and future, but it isn't a slam-dunk financial decision.
Let’s just look at the ideal situation that makes buying a no-brainer over renting: If you are planning to put 20% down payment on a 30 year mortgage, you qualify for 3.5% interest, you are in the 25% tax bracket, and you itemize your deductions. By meeting this three requirements you can almost guarantee that you will be paying substantially less on an equivalent home compared to renting. A lot does depend on where you live, but if you do your home work the investment will pay dividends! Contact your broker today to continue the discussion!