AOL Real Estate - Blog http://realestate.aol.com/blog AOL Real Estate - Blog http://realestate.aol.com/blog/media/feedlogo.gif AOL Real Estate - Blog http://realestate.aol.com/blog en-us Copyright 2013 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/Why Your Home Needs Central Air and a Walk-In Closethttp://realestate.aol.com/blog/2013/04/12/selling-home-central-air-walk-in-closet/http://realestate.aol.com/blog/2013/04/12/selling-home-central-air-walk-in-closet/http://realestate.aol.com/blog/2013/04/12/selling-home-central-air-walk-in-closet/#commentsFiled under: ,

By Jeff Brown

When you find your dream home, things just click. The closets may be a bit too small, the A/C may come from window units instead of a central system, and maybe there's no full-time guest room. ... But the place just has that magic. Still, it pays to think about those shortcomings, which could make it harder to sell when you're ready to move on in a few years. To some extent, the housing market is a fashion industry, and today's styles will sell better than yesteryear's.

A study by the National Association of Realtors says central air conditioning is the most critical of 33 features surveyed, with 65 percent of those polled rating it very important. So if the home doesn't have it when you buy, think about putting it in. You'll enjoy it and will find it easier to sell for the price you deserve.

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Among other highly desirable features: new kitchen appliances and a walk-in closet in the master bedroom. Buyers also preferred homes that were less than five years old, which might surprise those who believe in old-time craftsmanship. The fact is, newer homes are better insulated, have safer wiring and are built to withstand winds that would blow older homes apart.

Not surprisingly, buyers would prefer choice sites such as those on the water. They want basements, and many look for a home with an in-law suite. (Of course, that doesn't mean the in-laws will move in. The suite can serve a grown child who's slow to launch, or function as a better-than-average guest quarters.)

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Most buyers still want a traditional living room, even though modern life seems to gravitate to the great room. Asked what they were willing to spend more to get, a majority of buyers said: a laundry room and den/study/office/library. Many buyers who were satisfied with their home said that they would still like more and bigger closets and a larger kitchen. In fact, 47 percent of recent buyers undertook a major kitchen improvement quickly, and almost as many upgraded a bathroom.

Of course, buyers' demands vary by region and demographics. In the South, as one would imagine, air conditioning is especially important. And older buyers are more likely to prefer single-story homes. Obviously, there's no simple rule about what will appeal to a future buyer. But today's shopper would be wise to visit a wide range of homes, not just a few suggested by the real estate agent, to get a sense of the styles popular in the community.

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Builders have a pretty good sense of what buyers in the area want, so tour some open houses in new developments. If new homes offer stainless steel kitchen appliances, dedicated laundry rooms, finished basements and bedroom-size closets, you can bet that future buyers will demand those features -- at a minimum. Keep in mind, though, that many major home improvements don't add as much value as they cost, so it's probably not a good strategy to buy a substandard home and plan to upgrade just before selling. Get a home that has the features other buyers value, or put them in quickly so you can enjoy them yourself before selling.

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How to Identify the Most Desirable Home Features

 

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]]>central airhome featureshome features to sellselling a homewalk-in closetTheStreet.com2013-04-12T10:00:00 00:00Is Now a Good Time to Get a Reverse Mortgage?http://realestate.aol.com/blog/2013/03/29/reverse-mortgage/http://realestate.aol.com/blog/2013/03/29/reverse-mortgage/http://realestate.aol.com/blog/2013/03/29/reverse-mortgage/#commentsFiled under: ,

reverse mortgageBy Jeff Brown

Is this a good time to get a reverse mortgage? Yes -- even if you don't need one. That's the recommendation from Jack M. Guttentag, an emeritus finance professor at The Wharton School at the University of Pennsylvania. On his website, The Mortgage Professor, he says homeowners old enough to have a reverse mortgage -- 62 or older -- should think about getting a reverse mortgage credit line now, even if they won't use the money for years. Reason: Today's low interest rates make reverse mortgages something of a bargain, allowing you to borrow more if you lock in before rates rise.

A reverse mortgage is a loan against the homeowner's equity, which is the current value of the home minus any debt against it, such as a mortgage or home equity loan. Like an ordinary mortgage, the reverse loan charges interest, but the borrower makes no monthly payments. Instead, the debt, plus the gradually growing interest charges, are paid off when the borrower moves permanently, sells the home or dies.

More: Your House Is For Sale, You Just Don't Know It Yet

The debt can never exceed the proceeds of the home sale, so the reverse mortgage debt does not endanger the borrower's other assets. The most common type of reverse mortgage is the federally backed Home Equity Conversion Mortgage. Because there's no telling how large the borrower's debt could grow, reverse loans manage the lender's risk by providing less than 100 percent of the homeowner's equity at the time the loan is approved. A key factor in this calculation is the "expected interest rate." The lower it is, the more the homeowner can borrow, and rates are quite low today.

"For example, at an expected rate of 4 percent, which has been a common rate during 2013, a senior of 62 with a home worth $300,000 can draw an initial credit line of about $174,000," Guttentag says. "At an expected rate of 6 percent, the line drops to $140,000, and at 10 percent it falls to $54,000." In other words, get a reverse mortgage now and you can borrow more than if you wait until rates rise, as most experts expect over the next few years.

More: The Formula for Figuring Out If You Should Sell Your Home Now

But wait, there's more -- a second interest rate called the "accrual rate." Like the interest rate on a regular mortgage, it is the rate charged against the loan balance. If you use the reverse mortgage to borrow a lump sum, it is a fixed rate for the life of the loan. If you take out a line of credit to draw on in the future, or select a regular monthly payment, the accrual rate is adjustable -- it will rise or fall as market conditions change.

A rising rate need not be a concern if you expect to keep the reverse mortgage for the rest of your life, because you don't have to make payments no matter how high the rate goes. (Of course, a higher rate would drive up your interest costs, cutting deeper into any home equity you might hope to leave your heirs.)

More: America's Packing Up Bad Economy, Losing It In the Move

But the accrual rate has another function. Over time, the home presumably becomes more valuable, and therefore any unused portion of the borrower's credit line grows as the years go by. The accrual rate is used to determine how fast the credit line grows. The higher the rate, the bigger the credit line.

That means the homeowner who does not need to take cash out of the home right now can use today's low expected interest rate to get the largest possible line of credit to start with, and then, if the accrual rate goes up as expected, the borrower will see the credit line grow. The ideal strategy, Guttentag says, is to hold off drawing against the credit line for as long as possible. That way you could remain free of debt, but would have a rainy day fund that could be much larger by the time you need it.

See also:
What You Should Know About Reverse Mortgages
Reverse Mortgages Pose Big Risks for Seniors, Warn Attorneys and U.S. Officials

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A Reverse-Mortgage Strategy to Complement Your Buckets

 

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]]>accrual rateainy day fundHome Equity Conversion MortgageJack Guttentagmortgagesreverse mortgagesTheStreet.com2013-03-29T12:00:00 00:00You Can Buy a Home Even When It's Not for Salehttp://realestate.aol.com/blog/2013/03/25/buy-home-not-for-sale/http://realestate.aol.com/blog/2013/03/25/buy-home-not-for-sale/http://realestate.aol.com/blog/2013/03/25/buy-home-not-for-sale/#commentsFiled under: ,,

Home for sale signBy Marilen Cawad

Chris Lichon found her "dream" starter home as she was driving around Rutherford County, Tenn., one fine spring day. The house was on about an acre of ground, on a dead-end street, with a big pasture beside it that she could rent for her horse. It was perfect, she thought, except for one small detail. The house was not for sale.

Lichon had already been house-hunting for four months when she came across the 1970s ranch-style home. So when she found what she was looking for, her trusted real estate agent didn't think twice about knocking on the door and asking the question, "Would you consider selling your home?" To Lichon's surprise, the homeowners said yes. "They just asked us to give them a half hour to tidy up and then they showed us around the house," she said. Save for a few places that needed additional insulation, she found the three-bedroom, one-bath home to be well-maintained.

More: The Formula for Figuring Out If You Should Sell Your Home Now

As luck would have it, the owners were a growing family of seven who had long thought about moving to a larger place. They named their price, Lichon found it fair, and just like that, the house was sold. The lesson in this story: When buying a home, don't just rely on a real estate listing or a "for sale" sign. Trust your instincts and let your Realtor do the dirty work for you.

Joshua Baris, a real estate agent for Coldwell Banker in Northern New Jersey, recently had to knock on an unsuspecting homeowner's door for his client who wanted a specific three-bedroom luxury condo in West New York, N.J. His bold step resulted in a successful sale. "If you want to succeed in this market, you really have to be aggressive and creative," said Baris. Not only is he going house-to-house, he's also sending out letters to owners of unlisted homes on behalf of his clients.

More: America's Packing Up Bad Economy, Losing It in the Move

His letter would typically say: "My client is looking to buy a house and came across yours. Please call me to discuss in greater detail." Some recipients of his letter might find his actions intrusive and some might even think it's a scam, but Baris said that more often than not, people are willing to talk and negotiate. "It's not that everyone has a price, but you'll be surprised how many homeowners have thought about selling, but just never got around to doing it," said Baris. "The best deals are sometimes made when the buyer's agent is one step ahead."

The practice is not uncommon. All over the U.S., Realtors have been resorting to cold calls to get prospective buyers into unlisted homes. "This is happening more often than you might think, especially in the current market, in places where inventories are extremely low," said Keith Sorem, a real estate consultant and associate at Keller Williams Real Estate Services in Los Angeles.

More: Manhattan Bidding Wars to Persist as Housing Supply Stays Tight

A house, for example, may have failed to sell one or two years ago, so the owner took it off the market. However, home values in the area may already have increased today -- enough to where the owner would be willing to sell. In this case, Sorem said, a cold call would be welcomed by both buyer and seller.

When buying a home, it's always best to keep in mind that you have more options than you are presented with. You might consider selling your own home if prospective buyers asked and the offer was right. Similarly, your ideal home may not be on sale, but that doesn't mean you cannot buy it.

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How to Sell Your Home Yourself

 

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]]>buy a home not for salebuying a homehome buying advicehousing inventoryhousing recoveryhousing shortageTheStreet.com2013-03-25T13:30:00 00:00For Best St. Patrick's Day, Live in These 5 Irish-American Citieshttp://realestate.aol.com/blog/2013/03/15/irish-american-cities-st-patricks-day/http://realestate.aol.com/blog/2013/03/15/irish-american-cities-st-patricks-day/http://realestate.aol.com/blog/2013/03/15/irish-american-cities-st-patricks-day/#commentsFiled under:

By Jerry Kronenberg

If you love a good tin-whistle concert, real Irish butter or the Celtic game of hurling, consider moving to a U.S. city with a large Irish-American population. "Irish culture is very welcoming of everybody, whether you're Irish or not," says Sinead McLaughlin of the Irish Cultural Centre of New England, a popular spot with suburban Boston's big Irish-American community. Some U.S. cities' Irish populations trace their roots back as far as the 1600s, although the biggest wave of immigration came during Ireland's 1845-52 Great Famine.

More than a century later, many American communities offer a leprechaun's wealth of Irish culture, from authentic pubs and restaurants to local chapters of the Ancient Order of Hibernians social club. Irish-American groups also offer classes on everything from Gaelic to playing the Irish tin whistle or bodhran, a type of drum. Many communities even have leagues to play such traditional Celtic games such as hurling, which Denise Foley of IrishPhiladelphia.com describes as "a cross between hockey, lacrosse and assault with a deadly weapon."

Here's a St. Patrick's Day look at real estate and cultural offerings in the five U.S. cities the Census Bureau says have the highest percentage of Irish-American residents among metro areas with 1 million people or more. Population estimates come from the government's 2009-11 American Communities Survey, while real-estate prices come from Zillow.com's latest median-value estimates for all properties in each metro area whether for sale or not.

See more on TheStreet.com:
8 Great Irish Beers That Aren't Stouts
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Auto Loan Payments Are Getting Lower. Time to Jump In?

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]]>IrishIrish-American citiesst. patricks dayU.S. cities most Irish influenceTheStreet.com2013-03-15T14:00:00 00:003 Reasons Your Home's Value Is Risinghttp://realestate.aol.com/blog/2013/03/07/reasons-home-values-increase/http://realestate.aol.com/blog/2013/03/07/reasons-home-values-increase/http://realestate.aol.com/blog/2013/03/07/reasons-home-values-increase/#commentsFiled under:

By Brian O'Connell

The housing market is growing so robust that even "hard-hit" regions are getting up off the mat and back in the fight. In California, pending home sales are at a four-year high, according to the California Association of Realtors. That's increasing homebuyer competition and leading to multiple offers on many homes, the group says.

"The strong increase in January's pending home sales is an encouraging indication that we'll kick off the spring homebuying season on a solid start," says Don Faught, president of the association. "However, a low supply of available homes for sale will affect buyers, especially first-time buyers looking for more affordable, lower-priced homes, since they are having to compete with investors and all-cash buyers."

More from TheStreet: 101 Surprising Places to Celebrate St. Patrick's Day

According to San Diego-based Data Quick, a real estate technology analytics firm, 13 of the most troubled U.S. housing markets also saw "significant" growth rates in the first 30 days of 2013. Phoenix leads the way with a 24% increase on a year-to-year basis (from January 2012 through January 2013). Sacramento, Calif., clocks in second, at 15%, and Detroit hits third place at 14%. Other "troubled' metro areas experiencing housing price gains include Las Vegas; Richmond, Va.; San Jose, Calif.; Fort Myers, Fla.; San Diego; and Orlando, Fla.

Data Quick is, well, quick to point out that there is no way of knowing whether those price gains are for the long haul. "The January PIR reviews whether or not there is justification for these elevated growth rates, or if these growth rates are evidence of a new bubble forming in these areas," says Gordon Crawford, vice president of analytics at the company. "Although these markets are rebounding, there is uncertainty as to whether or not they will sustain consistent growth." For now, though, growth it is, and at a steady, upward rate. Why the ramp-up in home values? Experts cite three reasons:

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Employment is up. Data Quick says the U.S. jobs market is "steadily improving," and that has fueled home price gains in those hard-hit markets and other metro areas, as well.

The "bottom" has been reached. For years, economists, real estate agents and even homebuyers and homeowners yearned for a real estate market bottom, signaling that the worst is behind us and prices could once again move upward. Apparently, that benchmark has been reached. "During the housing crisis, many were uncertain as to where the bottom in home prices had been reached, causing many owners and investors to patiently wait on the sideline," Crawford says. "Once interested parties saw a market trough, they eagerly returned to the market."

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Home improvement stocks are up. Revenues at home improvement retailers such as Home Depot and Lowes are up, and that means consumers are once again putting money into improving their most valuable asset -- their homes. Fitch Ratings says that store sales figures were up 4.2% at Home Depot in 2012, while Lowes showed gains of 1.4% over the same period. Those growth rates should continue in 2013, Fitch says. "We project Home Depot and Lowes will generate same-store sales growth of approximately 2% to 4%, which is slightly below our forecast for 4% growth in total home improvement spending this year," Fitch states.

All in all, those trends paint a pretty picture of the U.S. housing market for the rest of 2013. With any amount of luck, there'll be enough paint left over for 2014.

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]]>home priceshome valuesreasons for home value increasewhy home prices are increasingTheStreet.com2013-03-07T15:30:00 00:00How to Choose an Investment Property That Earns You the Mosthttp://realestate.aol.com/blog/2013/02/28/how-to-choose-investment-property/http://realestate.aol.com/blog/2013/02/28/how-to-choose-investment-property/http://realestate.aol.com/blog/2013/02/28/how-to-choose-investment-property/#commentsFiled under: ,,

investment propertyBy Jeff Brown

What type of investment property should you buy -- a condo or single-family home? Until recently, that was a trick question, as real estate was too risky and illiquid for most investors. But growing evidence of a rebound in the housing market reduces the risk your investment property would lose value. Rising prices also improve your chances of selling without too long a wait if being a landlord doesn't suit you.

On Tuesday, S&P Dow Jones Indices reported that its S&P/Case-Shiller Home Price Indices showed home prices gained 7.3 percent nationwide last year. Various other surveys have showed gains, but the Case-Shiller gauge is widely viewed as one of the most definitive, and it's a very healthy gain. "As of the fourth quarter of 2012, average home prices across the United States are back at their autumn 2003 levels," the firm said. That's a good-news/bad-news statement: good because the market's improving, but also a reminder of how bad things were.

More from TheStreet: Get Ready to Buy a Home This Spring

Low mortgage rates make homes very affordable at today's prices, and investors have become very active in many markets. If you've already decided you can live with the hassles of being a landlord, what type of property is best -- a single family home or condo? To a large extent, that will depend on the individual market. In communities such as the Florida coast, there may be many more condos than single-family homes. In suburbs and rural areas, single-family homes dominate.

Rental rates on the two types of properties are a key issue. Investors generally assume that it will take four or five years of rent increases for income to cover maintenance costs, taxes and other expenses. If there's a glut of condos or single-family homes, you may not be able to raise rents very fast, prolonging your time in the red. Of course, a glut also means home prices will not rise very fast. The ideal rental property is in high demand, allowing the owner to raise rents every year and assume that property values will rise at a good clip.

More from TheStreet: Why It's Time for Buyers to Reconsider an ARM

Generally, operating costs are easier to estimate on condos, because the exterior work is covered by your association fees. With a single-family home, costs for a new roof, landscaping and exterior painting could hit you out of the blue. Another factor to consider: the type of renter likely to be drawn to your property. A recent survey by Premier Property Management Group, which manages 1,700 properties in 20 U.S. cities, found that renters of single-family homes are 18 percent more likely to stay in the home for five years or longer. Generally, that's good for the property owner, because each change in tenants can mean going a month or two without rent.

The survey noted an increase in recent years of the number of single-family homes for rent. That's due, in part, to the large numbers of foreclosed properties that have been turned into rentals and the difficulty many renters have had in getting mortgages. "Single-family renters make more money and are nearly twice as likely to have children as apartment dwellers," the survey found. Around the country, the median income for single-family renters ranges from $75,000 to $100,000, compared with $50,000 to $75,000 for renters in multifamily housing. About 63 percent of single-family renters have children, compared with 34 percent of multifamily renters. Single-family renters also tend to be older.

More from TheStreet: 5 Worst Housing Markets for 2013

No doubt, there are lots of terrific tenants among the childless 20- and 30-somethings who prefer multifamily housing and are likely to move fairly often. But tenants who are older, more prosperous, used to dealing with responsibilities such as children and likely to stay in the home for a number of years can be especially appealing for the property owner. With an unusually large number of renters of this type looking for homes, the single-family investment property is worth considering.

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Is Real Estate Still A Good Investment? From Maria Bartiromo

 

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]]>how to choose an investment propertyinvestment propertylandlord issuesreal estate investingreal estate investorsTheStreet.com2013-02-28T10:00:00 00:005 Warm-Weather Cities With the Hottest Housing Marketshttp://realestate.aol.com/blog/2013/02/26/warm-cities-best-housing-markets/http://realestate.aol.com/blog/2013/02/26/warm-cities-best-housing-markets/http://realestate.aol.com/blog/2013/02/26/warm-cities-best-housing-markets/#commentsFiled under:

By Jerry Kronenberg

Sick of the cold and snow that's been slamming cities from Sacramento, Calif., to Portland, Maine, recently? Maybe it's time to consider moving to a warmer locale. "Whether they're from Chicago, Toronto, New York or Boston, lots of people move to South Florida for our warmth," says Andrew Barbar, a Keller Williams East Boca Raton broker and vice president of the Florida Realtors association. "People who come here from cold climates enjoy soaking up the sun." Warm states such as Florida have been attracting a greater and greater share of the U.S. populace for decades.

For instance, Census figures show that the Sunshine State's population nearly doubled between 1980 and 2010, while cold-weather Michigan and Ohio grew by only about 6.7% (way below the 36.3% national average). Barbar, who's lived in Florida for nearly 40 years, says his state's climate "is the primary reason people move here." The beach weather attracts not only buyers from cold U.S. and Canadian locales, but also from cooler parts of Germany, Britain and other European countries.

"Florida is attractive not only to people up North, but to people all over the world," the Realtor says. In fact, a good climate is helping lots of U.S. cities rebound from the deep housing bust that many faced during the past few years. Market tracker Realtor.com found recently that warm locales made up eight of the 10 U.S. cities that saw the greatest percentage gains in asking prices over the 12 months ended Jan. 31. (The number jumps to nine of 10 if you count Washington, D.C., as a warm-weather city.)

Barbar says out-of-state buyers have helped push Miami's inventory of unsold homes down to less than a five-month supply these days from 39 months during the worst of the bust. "All of coastal Florida has not only stabilized but is recovering," he says. "We're seeing a seller's market right now."

Here's a look at housing conditions in America's five warmest major cities. Rankings are based on each locale's mean daily temperature during the December-to-February period, as calculated by the U.S. National Oceanic and Atmospheric Administration using 1981-2010 readings. Housing values refer to median asking prices for homes up for sale as of January on Realtor.com, the National Association of Realtors' official property-listing site.

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]]>best cities for warm weatherbest housing marketsbest housing markets warm citieshot housing marketswarm citiesTheStreet.com2013-02-26T14:30:00 00:005 Towns Named After Presidents -- And More Affordable Than Washington, D.C.http://realestate.aol.com/blog/2013/02/19/towns-named-after-presidents/http://realestate.aol.com/blog/2013/02/19/towns-named-after-presidents/http://realestate.aol.com/blog/2013/02/19/towns-named-after-presidents/#commentsFiled under:



By Jerry Kronenberg

You know that Washington, D.C., is named for America's first president, but did you know that Harrison City, Pa., (population 134) honors ninth president William Henry Harrison? Or that Pierceton, Ind., (population 1,015) memorializes 14th president Franklin Pierce? "You can find towns named after [obscure presidents] all over the place," says Grant Smith, an expert on "toponymy" (the study of how places got their names).

Smith, an Eastern Washington University professor and past chairman of the American Name Society's Toponymy Interest Group, says that presidents who are lesser known today often got communities named after them thanks to the intervention of supporters of their own time. "People who were in the right place at the right time and had the authority to name their communities often named them after someone they thought was a good president," he says.

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Smith -- whose forefathers helped name Blaine, Wash., after failed 1884 Republican presidential candidate James G. Blaine -- says many U.S. leaders little remembered today had plenty of contemporary fans. "A lot of people must have admired [1920s presidents] Warren G. Harding and Calvin Coolidge -- who didn't do much -- because they wouldn't have gotten elected otherwise," he says. Still, Smith says the golden age of naming towns after presidents ended in the late 1800s, when newcomers for the most part filled in the last unsettled parts of our country.

He doesn't expect any future Obamavilles or Romneytowns, as builders who create today's "planned communities" are too afraid of offending any would-be buyers. "Today's developments tend to have idealized names like 'Sherwood Forest' or 'Mill Creek' -- names that are comfortable and will attract suburbanites," Smith says.

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Here's a look at real estate in five communities across America that are named after some lesser-known U.S. leaders. Median home prices and 12-month net changes for each town are courtesy of market tracker Zillow.com and reflect estimated values for all local residences (not just those on the market) as of Dec. 31. Population and income figures are from the U.S. Census Bureau.

More from TheStreet.com: Cohabitation Trepidation

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]]>presidential townstowns named after presidentsTheStreet.com2013-02-19T12:52:00 00:00As Spring Home Buying Season Approaches, Here's How to Preparehttp://realestate.aol.com/blog/2013/02/12/spring-real-estate-season/http://realestate.aol.com/blog/2013/02/12/spring-real-estate-season/http://realestate.aol.com/blog/2013/02/12/spring-real-estate-season/#commentsFiled under:

By Jeff Brown

As we mentioned the other day, conditions are looking up for homeowners who want to sell. That implies, of course, that things must be good for buyers, too. In fact, a survey from Fannie Mae indicates that more and more potential buyers are getting ready to move off the sidelines. As people see reports of rising home prices, they lose their worries about buying a home that will fall in value. And, of course, when prices are rising, potential buyers want to move before prices go up even more.

Fannie Mae's survey of 1,003 Americans found that 41% expect home prices to rise over the next 12 months, while only 10% expect prices to fall. Underscoring the change in sentiment, 23% said it was a good time to sell a house, a 12-point gain over the past year. Also, 50% said they expect rents to go up over the next year, giving renters added incentive to buy.

Related: Homes for Sale in Your Area

In addition, 23% said their household income was significantly higher than 12 months earlier, while just 19% -- the lowest since the survey began two and a half years ago -- said they were concerned about losing their job. "Concerns about job loss are waning as payrolls are growing -- a trend that may give potential homebuyers more confidence that they can meet the financial obligation of homeownership," said Doug Duncan, Fannie Mae's senior vice president and chief economist. He noted that "the number of homeowners who are underwater is declining, reducing a barrier for those owners who need to sell their home in order to buy a new one."

So with the spring home-buying season only a few weeks away, how should the prospective buyer use this time to prepare? Assuming you'll need a mortgage, the first step is to be sure your credit history is accurate and your credit rating as high as possible. Make sure all bills are paid on time and pay off your credit card balances. The less debt you have, the bigger the mortgage you can get. Don't open new lines of credit such as credit card accounts, even if you don't intend to use them right away, because mortgage lenders are wary of borrowers who could get into trouble from an overabundance of available credit.

More from TheStreet: Why Whole Regions Have Better Credit Scores Than Others

Start assembling cash. Chances are you'll need a down payment of 20% of the home's purchase price. Other expenses such as points, application fees and advances on taxes could equal 5% to 10% of the price. Your real estate agent and lender can help you zero in on a figure.

Consider hiring a buyer's agent, a real estate agent who works for the buyer rather than the seller. Legally, the buyer's agent has to put your interests first, while the seller's agent looks after the seller. A buyer's agent won't cost you anything, as he or shares the sale commission with the seller's agent.

More from TheStreet: Mortgage Sales Rep Market Looks Great, But Very Different

Before you start looking at houses, investigate neighborhoods. School quality is important even if you don't have children, because when it comes time to sell the home, buyers may want good schools. Beware neighborhoods with large numbers of "distressed sales" such as foreclosures and short sales. Those desperate sellers may settle for fire-sale prices, undercutting home values, and you don't want to be in a neighborhood with vacant homes that are deteriorating.

Finally, start your mortgage hunt, looking for a lender with a good combination of low rates and low fees. Narrow the list to three or four lenders so you'll be able to move quickly when you find a home. Get a pre-approval, which is a lender's assurance you can qualify for a loan of a given size. That will make your offer more appealing to the seller.

More from TheStreet: Why Mortgage Rates and Applications Are Both Up

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find foreclosures in your area.
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Common Home Buying Mistakes

 

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]]>buying a homebuying a home springselling a home springspring home buyingspring home buying seasonspring real estate marketspring real estate seasonTheStreet.com2013-02-12T15:00:00 00:005 Worst Cities to Buy Foreclosures in 2013http://realestate.aol.com/blog/2013/02/07/worst-cities-buy-foreclosures-2013/http://realestate.aol.com/blog/2013/02/07/worst-cities-buy-foreclosures-2013/http://realestate.aol.com/blog/2013/02/07/worst-cities-buy-foreclosures-2013/#commentsFiled under: ,

Foreclosure sign: 10 worst cities to buy themBy Jerry Kronenberg

The U.S. foreclosure crisis looks like it's finally winding down -- great news for homeowners, but decidedly less positive for house hunters and real estate investors. "From the perspective of buyers, [some] markets might not be as attractive anymore," says Daren Blomquist of market watcher RealtyTrac. The organization recently found that U.S. foreclosure-related filings fell during 2012 for the second straight year.

RealtyTrac, which monitors county registries of deeds around the country, says lenders filed paperwork covering around 1.9 million foreclosures, deed seizures and property resales in 2012 -- a roughly 34% drop from 2010's 2.9 million peak. The firm also analyzed all 102 U.S. metro areas with 500,000 residents or more and found that filings fell by double-digit percentages in many locales during 2012.

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Blomquist says house hunters and investors looking to buy foreclosures on the cheap in those cities can expect to "compete against each other for places this year. The foreclosure supply is drying up, but there's still interest from other buyers."

The expert says markets with the worst prospects for buyers are generally in "non-judicial foreclosure" states, where laws allow lenders to seize properties quickly with little court involvement. For instance, the average foreclosure finalized in nonjudicial Texas during 2012's fourth quarter took just 113 days from start to finish versus 1,089 days in judicial-foreclosure New York. Blomquist says nonjudicial states' speedier processes have allowed banks to clean out backlogs of delinquent properties there, making fewer distressed homes available for would-be buyers.

More from TheStreet: It's Possible: Great Work-at-Home Jobs, Great Parenting

"The worst cities for foreclosure buyers are typically those places that worked through their problems fairly quickly," he says, adding that people looking for deals should check out metro areas with more problems. Click through the gallery below for a look at the five metro areas that RealtyTrac predicts will offer would-be foreclosure buyers the worst deals in 2013.

The firm based its rankings on a number of factors, such as how many months of unsold foreclosures each city had on the market as of Dec. 31. All figures cover houses, townhouses, condos and apartment buildings with four units or less. Average percent discounts on foreclosures refer to properties sold during 2012's first 10 months, the latest period with data available.

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Best Cities to Buy Foreclosures in 2013
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How to Buy at a Foreclosure Auction

 

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]]>buying a homecheap homesforeclosure crisisforeclosure dealsforeclosure deals 2013foreclosure deals for homebuyersforeclosuresforeclosures 2013homebuyersreal estate dealsworst cities to buy foreclosuresworst cities to buy foreclosures 2013TheStreet.com2013-02-07T09:00:00 00:00Home Prices Post Biggest Gain in 6 Yearshttp://realestate.aol.com/blog/2013/02/05/home-prices-post-biggest-gain-in-six-years/http://realestate.aol.com/blog/2013/02/05/home-prices-post-biggest-gain-in-six-years/http://realestate.aol.com/blog/2013/02/05/home-prices-post-biggest-gain-in-six-years/#commentsFiled under: ,,

Home prices gain

By Shanthi Bhaharatwaj

Home prices rose 8.3 percent in December from a year earlier, the biggest gain since May 2006, according to CoreLogic. All but four states -- Pennsylvania, New Jersey, Illinois and Delaware -- posted increases. Prices rose 0.4 percent in December from November, the 10th consecutive monthly advance. Excluding foreclosures and short sales, which sell at deep discounts to market prices, home prices were up 7.5 percent on a year-over-year basis and 0.9 percent month-over-month.

The states with the highest home-price appreciation in December were Arizona (20 percent), Nevada (15.3 percent), Idaho (14.6 percent), California (12.6 percent) and Hawaii (12.5 percent). "We are heading into 2013 with home prices on the rebound," said Anand Nallathambi, president and CEO of CoreLogic. "All signals point to a continued improvement in the fundamentals underpinning the U.S. housing market recovery."

Related: Find Homes for Sale in Your Area

Housing appears to have some momentum, with prices expected to rise 7.9 percent in January from a year earlier, according to Core Logic's Pending Home Sales Index. Month over month, prices are likely to decline by 1 percent, reflecting the seasonal winter slowdown. Excluding foreclosures and short sales, home prices are likely to rise 8.6 percent on a year-over-year basis and 0.7 percent on a month-over-month basis in January.

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]]>home priceshome prices biggest six-year gainhome prices risehousing recoveryTheStreet.com2013-02-05T11:30:00 00:00Housing Market 2013 for Homebuyers: It's a Balancing Acthttp://realestate.aol.com/blog/2013/01/29/housing-market-2013-homebuyers/http://realestate.aol.com/blog/2013/01/29/housing-market-2013-homebuyers/http://realestate.aol.com/blog/2013/01/29/housing-market-2013-homebuyers/#commentsBy Brian O'Connell

Talk to any Realtor these days and you'll likely get an earful about "limited inventories." That's a big departure from the past few years, when home sellers were eager, for a variety of reasons, to pound those "for sale" signs into their front lawns. While existing home sales eased in December, the number is 12.8 percent higher than in December 2011, according to the Washington-based National Association of Realtors.

All together, total U.S. home sales last year rose to 4.65 million, up from 4.26 million in 2011, the NAR says. That's the highest total since 2007. The story now in the U.S. housing market is all about demand.

"Record-low mortgage interest rates clearly are helping many homebuyers, but tight inventory and restrictive mortgage underwriting standards are limiting sales," says Lawrence Yun, chief economist at the NAR. "The number of potential buyers who stayed on the sidelines accumulated during the recession, but they started entering the market early last year as their financial ability and confidence steadily grew, along with home prices. Likely job creation and household formation will continue to fuel that growth. Both sales and prices will again be higher in 2013."

Related: What Florida Shows Us About the Real Estate Market

But there's another issue that could affect the housing market in a big way this year. In essence, the script has flipped from 2007 to 2012, as homeowners are more inclined to sit on the sidelines and not sell their homes -- at least not right now. Over the past few years, there have largely been more sellers than buyers, forcing home sellers to reduce prices and keeping homes from getting offers from multiple bidders.

According to a survey by Redfin, a Seattle-based online real estate broker, only 49 percent of 895 homeowners "with intent to sell their homes" plan on selling their homes in 2013, and only 22 percent believe now is a good time to sell. Mainly, that sentiment is tied tightly to a perception that home prices are rising: 81 percent of homeowners surveyed believe prices will rise in 2013, and 34 percent say that "missing out" on future home price gains is the primary reason they are holding off on selling their homes.

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That has led to a downward shift in U.S. homes for sale, Redfin says. The firm says that home sale inventories "plummeted in every market" it covers. The company's data show 30 percent fewer home sale listings than in 2012. "The growing number of home sellers whose top concern is that they may miss out on even greater price gains suggests homeowners' continued reluctance to enter the market just yet," Redfin says in a Jan. 24 statement.

That may be only a temporary trend, though. "As prices continue to rise, Redfin expects what it now considers an inventory crisis to ease as the spring and summer home-selling seasons approach," the firm reports. The takeaway for homebuyers? It's a bit of a balancing act. Sure, interest rates are low, but some analysts expect mortgage rates to rise in 2013. With limited home inventories on the market and prices expected to rise, maybe it's a good idea to get cracking, even in the dead of winter, and see what deals are out there right now.

Related: Don't Forget the Tax Basic: Save Your Receipts

 

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]]>advice for homebuyershome buying advicehomebuyershomebuyers housing markethousing market 2013TheStreet.com2013-01-29T13:45:00 00:00What Florida Shows Us About the Real Estate Markethttp://realestate.aol.com/blog/2013/01/25/florida-real-estate-market-lessons/http://realestate.aol.com/blog/2013/01/25/florida-real-estate-market-lessons/http://realestate.aol.com/blog/2013/01/25/florida-real-estate-market-lessons/#commentsFiled under: ,,

Florida real estate market offers lessons for homebuyers.By Jeff Brown

Sick of the cold? Maybe you should buy a place in Florida, where temperatures are warm and the housing market is heating up.

The cold snap gripping much of the country is surely prodding many to dream of owning a second home someplace warm, or of moving there for good. Data show that Florida's housing market might be in a sweet spot. Prices remain low, as Florida was among the states hit hardest by the collapse of the housing bubble, but prices are on the rise, so a purchase now would appear less risky than it would have a year ago.

But Florida also offers some object lessons. Its volatile housing market demonstrates the importance of thinking clearly about the pros and cons of buying a home when you don't have to. Placing the wrong bet can be very, very dangerous.

A large portion of Florida's housing market is driven by people who don't really need to buy, such as retirees who could stay where they are in other parts of the country and second-home buyers who could wait if conditions aren't right. That makes them more fickle than people who must move for a job or growing family. As a result, Florida home prices tend to swing to extremes.

Now things are getting better. The number of housing sales that closed in December was nearly 16 percent higher than a year earlier, according to Florida Realtors, a trade group. And the number of pending sales, or those with signed contracts that have not yet closed, was up nearly 40 percent. The median sales price remained affordable, at $154,000, up about 14 percent from a year earlier. Nationally, the median sales price was $180,600 in November, a 10 percent increase from a year earlier.

Median sales prices need to be taken with a grain of salt. They don't necessarily mean the average house value has grown 14 percent in Florida, because sometimes it's the pricier homes that move more briskly, other times it's the cheaper ones. A year ago, sales included more foreclosed homes going for fire-sale prices.

Because of the market's volatility, anyone considering buying a retirement or second home in Florida should pay special attention to some key questions.

First, how easily can the balance of supply and demand change? On many of the barrier islands off the East Coast, for instance, there's not much room for further development, so it's unlikely that a flood of new homes will depress prices in these areas. But in many areas just a few miles away on the mainland there's plenty of undeveloped land. As prices rise, developers tend to break ground on single-family homes and condos, and that new supply slows the price gains or reverses them.

In areas popular for retirement and second homes, condominiums are very popular, and condo fees can be very high. In fact, you could pay more in condo fees than you would on your new mortgage. In an economic downturn, growing numbers of condo owners stop paying their fees. The association may respond by skimping on maintenance or jacking up fees.

So potential buyers eyeing the warm winter temperatures in Florida should be especially attentive to the basic lessons of the recent housing crisis: A home is a home, not an investment. And the best way to minimize your risks is to resist the temptation to buy the most expensive home you can afford, and to plan to own it long enough to ride out the downturns.

See more on TheStreet.com:
America's 5 Most Affordable Housing Markets
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Where to Buy -- and Not to Buy -- a House in 2013

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Asian Investors Dive Into U.S. And European Real Esta

 

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]]>buying a home in floridaflorida housing marketflorida real estateFlorida real estate marketTheStreet.com2013-01-25T11:25:00 00:006 Real Estate Apps for Finding a New Homehttp://realestate.aol.com/blog/2013/01/10/6-real-estate-apps-for-finding-a-new-home/http://realestate.aol.com/blog/2013/01/10/6-real-estate-apps-for-finding-a-new-home/http://realestate.aol.com/blog/2013/01/10/6-real-estate-apps-for-finding-a-new-home/#commentsBy Jerry Kronenberg

That cool new smartphone you got this holiday season can help you find a cool new place to live if you're planning on going house-hunting in 2013.

That's because real estate firms, listing services, mortgage companies and more have thousands of free smartphone apps available to help you find your piece of the American Dream.

"There are a number of different apps that can show you what houses are for sale or what's previously sold near wherever you happen to be," says Daniel Terdiman, a senior writer at electronics-review site CNET.com who's using mobile apps in his family's search for a San Francisco-area home.

Related: Homes for Sale in Your Area

Terdiman says good house-hunting apps use your smartphone's global-positioning system to figure out where you are, then provide a wealth of information about nearby listings.

"These apps are definitely a good thing to have when we're out and about looking at houses," he says. "It's like filling in the gaps of things you can't know about a listing because you're not near a computer."

Here's a look at six free smartphone apps that anyone who's looking for a new pad should definitely check out:

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See more on TheStreet.com:
America's 5 Most Affordable Housing Markets
America's 5 Least Affordable Housing Markets
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Find foreclosures in your area.
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]]>best real estate appsbuying a homehouse huntinghouse hunting appsiPhonereal estate appsTheStreet.com2013-01-10T10:30:00 00:00Home Appraisals Lower Than Prices? What to Dohttp://realestate.aol.com/blog/2013/01/09/home-appraisals-lower-than-prices-what-to-do/http://realestate.aol.com/blog/2013/01/09/home-appraisals-lower-than-prices-what-to-do/http://realestate.aol.com/blog/2013/01/09/home-appraisals-lower-than-prices-what-to-do/#commentsBy Jeff Brown

Like many young things, the housing recovery is suffering some growing pains, as appraisals lag rising prices and make it difficult for borrowers to get loans.

The problem, mortgage-data firm HSH Associates says, starts with the conservative appraisal standards implemented during the financial crisis. That is compounded by a natural lag in comparable-sales data. The result -- appraisals coming in lower than the price seller and buyer have set -- is a possibility both parties need to take into account as they enter this changing market.

"While low home values continue to be an obstacle in the way of a full housing recovery, more and more markets in recent months have experienced home-price improvements," HSH reports. "Although home prices are up in some areas, many real estate agents, homeowners and homebuyers alike are frustrated that appraisals aren't keeping pace with current home-price appreciation."

Related: Home Appraisals for Sellers

In places where the number of home sales remains low, appraisers do not have many recent sales to examine in establishing current values, HSH says. Relying on sales from many months earlier means using data that do not reflect recent price increases. Also, many appraisals are being done by out-of-town appraisers who do not have a feel for recent changes in the local market, HSH reports. It cites a recent survey by the National Association of Realtors that found 34% of Realtors reporting problems with appraisals in the past 12 months.

When the appraiser sets a value lower than the mortgage the buyer needs, the lender will deny the loan.

What can buyer and seller do?

First, they need to be realistic about prices. The seller, especially, should recognize that recent home price gains have been modest. People are enthusiastic about the housing market because it appears to have turned a corner -- because prices are no longer falling. That doesn't mean they're soaring.

Related: Homes for Sale in Your Area

Both parties can use sites such as AOL Real Estate, Realtor.com, Trulia and Zillow to assess prices from sales in the past two or three months. Be sure the homes are really comparable to the subject property, then use the comps to calculate a price per square foot that can be applied to homes in the neighborhood.

The real estate agent will also have thoughts on this. Each party should pick an agent who has been in the local market for a number of years and has lots of current listings and recent closings. Part-timers and newcomers won't have enough feel for the market to spot recent trends.

Keep in mind, though, that an agent has a financial incentive to encourage the seller to be "realistic" about price, or to ask a bit less. Most agents would prefer a slightly smaller commission for a home that sells quickly.

HSH suggests that the seller be present during the appraisal to point out value-enhancing features the appraiser may overlook. The seller can also give the appraiser a written description of the home's merits, as well as a list of comparable homes in the neighborhood that have sold.

Related: Inside the Mind of an Appraiser

Buyer and seller should study the appraisal closely, looking for errors, oversights or the use of comparable sales that aren't really comparable. If that doesn't work, the buyer can ask the lender to allow a second appraisal.

The buyer should be sure the sales contract includes the standard language canceling the deal if the appraisal comes in too low. A low appraisal thus allows the buyer to negotiate for a lower price.

Finally, the buyer, if possible, can offer a larger down payment, reducing the mortgage required to a level below the appraisal.

None of these techniques is a surefire way to get the deal done, but they could close a modest gap. As the process continues, both parties should constantly scour the market for fresh comparables -- data all parties can use to keep abreast of a market that could change quickly as spring approaches.

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]]>appraisalshome appraisalshome priceshome valuesHSH AssociatesTheStreet.com2013-01-09T08:30:00 00:00America's 5 Least Affordable Housing Marketshttp://realestate.aol.com/blog/2013/01/03/americas-5-least-affordable-housing-markets/http://realestate.aol.com/blog/2013/01/03/americas-5-least-affordable-housing-markets/http://realestate.aol.com/blog/2013/01/03/americas-5-least-affordable-housing-markets/#commentsFiled under: ,,

Least affordable housing market: San Francisco

America's least affordable housing markets all cost big bucks because lots of people want to live there, but oceans or other natural barriers leave little available real estate for additional homes.

"The fundamental [unaffordability] of these markets hasn't changed despite the fact that home prices are down and we're seeing incredibly low mortgage rates," says Mike Sante of Interest.com, which recently compared median incomes and home prices in America' 25 largest cities.

Interest.com found that families who make local median incomes in 11 of the 25 areas studied don't make enough to qualify for the mortgages they'd need to buy median-priced homes there.

Sante says America's least affordable cities all combine strong consumer demand with low housing supply due to a lack of open space for added construction.

"Consider San Diego, which is bounded on the west by the Pacific Ocean, on the south by Mexico and on the north by some very, very large military bases," he says. "The only place for San Diego to expand is eastward into the desert -- and that puts a tremendous restriction on development."

By contrast, Sante says that cities Interest.com found have high affordability typically have lots of available land.

"Without getting into a discussion about urban sprawl, the fact is that when can you expand in all directions and have lots of land to build on, that helps hold down local median home prices," he says.

Here's a look at the five cities Interest.com found are the least affordable places for U.S. homebuyers.

The list of housing markets was compiled by calculating how much you'd pay each month for a median-priced home in each city, assuming you put 20 percent down and got a 30-year fixed mortgage that charged the local average interest rate.

Interest.com added median annual local property taxes and homeowners' insurance premiums and looked at whether a family earning a given city's median household income could meet the "28 percent rule." That standard, which lenders have historically used when deciding whether to OK a mortgage, looks at whether a borrower can pay all monthly housing costs using no more than 28 percent of gross income.

All median single-family-home prices listed are as of the second quarter, while 30-year fixed-mortgage rates are as of Sept. 19. Median annual household incomes and property taxes are as of 2011, while average annual homeowners' insurance premiums are as of 2009.

"Above-average" and "below-average" figures refer to the average of all 25 cities analyzed -- $50,502 for incomes, $2,331 for property taxes and $880 for insurance premiums. "Average home prices," though, refer to the $229,516 median found in a larger pool of locations that the National Association of Realtors tracks.

5. Los Angeles

The City of Angels is a real devil when it comes to housing affordability.

Interest.com found that while Los Angeles households enjoy above-average median incomes ($56,653), the metro area's high median home prices ($296,800) and property taxes ($3,985) eat all of that up and more. La-La Land's residents also pay a slightly above-average $922 in median homeowners' insurance premiums.

Add it all up and a typical Los Angeles family makes 12.5 percent too little to qualify for a mortgage on a median-priced L.A. home.

"Los Angeles just has much-higher-than-average home prices," Sante says. "Even though they have slightly higher median incomes, it's not enough to make up for that."

4. Miami

The U.S. housing bust has left Miami's median home prices at a below-average $206,700, but the typical family there also makes a below-average $45,407 income. That trails only Tampa as the nation's lowest median income for any major city.

"Miami's property values have fallen, but they haven't fallen enough to offset the fact there are a lot of 'low-middle-income' households in town," Sante says.

Miami also has above-average median property taxes ($2,600) and homeowners' insurance ($1,460 a year, due to high hurricane risks).

All told, Interest.com found that Miami households make a median income that's 12.6 percent below what they'd need to get a mortgage for median-priced local there.

3. San Diego

"San Diego is a place where lots of people want to move, but the city is very constricted in terms of where it can build," Sante says. "As a result, it has extremely [high] home prices."

Interest.com found that a median San Diego-area house costs $379,100 -- trailing only San Francisco as the nation's priciest housing.

Above-average median property taxes ($3,384) and homeowners' insurance premiums ($922) only add to affordability woes.

True, San Diego does have an above-average median household income ($59,477). But Sante says that's "not nearly enough to make up for the high property taxes and the way-way-way-above-median home prices."

The bottom line: The typical San Diego family makes 26 percent too little to get a mortgage on a median-priced local home.

2. New York

The Big Apple offers consumers little in the way of housing affordability.

New York's $7,183 median property taxes are No. 1 among major U.S. cities, while Gotham's $377,600 median home price trails only San Francisco's as the nation's highest.

New Yorkers also pay a higher-than-average $1,021 a year in median homeowners' insurance premiums.

As a result, Interest.com found that even though New York families enjoy an above-average $62,322 median household income, that's still 29.7 percent below what's needed to qualify for a loan on a median-priced local home.

1. San Francisco

If you're going to San Francisco, be sure to wear some flowers in your hair -- and put lots of money in your wallet.

That's because Interest.com found that the City by the Bay has the absolutely worst housing affordability of any major U.S. metro area.

San Francisco's $71,975 median household income trails only Washington's as the highest among major cities, but it's still 32.8 percent too low to allow a typical family to qualify for a mortgage on a median-priced home.

Sante says that San Francisco is unaffordable mostly because it has the nation's most-expensive properties: $552,600 for a median-priced home.

"Again, it's all due to limited land," he says. "You're hemmed in by the Pacific Ocean and bay, and concerns about earthquakes limit the density of the housing that you can develop."

Interest.com also found that the typical San Francisco homeowner faces an above-average $922 in annual insurance premiums, plus a median $4,991 in property taxes -- second only to New York as the nation's steepest annual bill.

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]]>Interest.comleast affordable housing marketlos angeles housing marketmiami housing marketnew york housing marketsan diego housing marketsan francisco housing marketTheStreet.com2013-01-03T11:30:00 00:00Vacation Homes: How to Market Them to Renters Without Going Crazyhttp://realestate.aol.com/blog/2012/12/27/how-to-market-your-vacation-home/http://realestate.aol.com/blog/2012/12/27/how-to-market-your-vacation-home/http://realestate.aol.com/blog/2012/12/27/how-to-market-your-vacation-home/#commentsBy Jeff Brown

The lure of a vacation home is strong this time of year, especially if you live in a chilly latitude. Imagine having a place at the beach. Swimming, tennis and golf in January! T-shirts instead of overcoats!

But can you make it work financially?

Face the facts: It would be awfully tough to turn a vacation home into a money-maker, even if it's somewhere highly sought by vacation renters. A vacation home is a luxury.

But renting it out when you're not using it can bring in substantial income, cutting your ownership costs dramatically. There are tricky tax questions here, which we'll save for another time. For now, let's look at ways to maximize the income.

Related: Find a Vacation Home for Sale

The first step, of course, comes before buying, when you research the property to find out how much rent it has drawn and how consistently. It will also pay to look at similar properties, to see what they charge, what they offer and find ways to gain an edge.

If the competitors offer 50-inch TVs, maybe you should provide a 55-inch TV -- and add a TV to each bedroom. If competitors offer basic cable service, maybe you should have some premium channels.

Today, many people are never quite free of the office. So think about providing high-speed Internet and Wi-Fi, plus a decent printer/copier/fax/scanner.

Next question: How will you get your renters?

The best option is to combine your own efforts with those of a professional. In many vacation areas, real estate agencies offer rental services, often for a commission of up to 25% of the rent. A good pro will have tips on making your place more appealing and will know how much rent you can get during the high season and offseason.

Related: Find Homes for Rent

In a well-designed arrangement, the agent's incentives are aligned with the owner's. Both of you, for instance, want to get the highest rent possible without scaring off prospective renters by overcharging. A good pro will know when it will pay to accept less rather than risk going vacant for a week.

Although the commission is negotiable, keep in mind that the agent will represent other properties and, given a choice, will steer prospective renters to the units that provide the biggest income and rent with the least effort. You might give the agent extra incentive by negotiating a sliding commission that would pay more if your rental income exceeds a given threshold. You might, for instance, pay 20% on the first $10,000 in income, 30% on anything above that.

Be sure that the agent will advertise the property on the multiple listing service for rentals used by all agents in the area, and that other agents will be provided a healthy slice of the commission if they bring in renters. Again, you might try to beat the average.

Also be clear on the duties your agent will perform. Those should include vetting prospective renters, arranging for cleaning and inspection after a renter leaves and sending in a handyman for such things as a plugged drain.

Your deal with the agent should also allow you to seek renters on your own. That will save you on commission costs and spur your agent to beat you to the punch in signing up renters. Many owners advertise on sites such as Vacation Rentals by Owner.

Because prospective renters going to your VRBO site will see your competitors' properties, it would be worthwhile to set up a website of your own on Facebook or a similar service. You can use that when people respond to your flier on the office bulletin board, for instance.

The key is to hustle. If you get a kick out of running a little enterprise, negotiating and keeping track of details, renting out a vacation home can slash your ownership costs.

If the thought of all those chores makes you shudder, maybe owning a second home is not for you.

See more on TheStreet.com:
Are Reverse Mortgages a Ponzi Scheme?
When Retirees Should Consider Renting When They Downsize
Why Paying Off Your Mortgage is Actually Dumb

 

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]]>how to market vacation homesmarket vacation homesrenting vacation homesvacation homesvacation rentalsTheStreet.com2012-12-27T11:30:00 00:00Mortgage Refinance Boom Still a 'Once-in-a-Lifetime Opportunity'http://realestate.aol.com/blog/2012/12/20/mortgage-refinance-boom-opportunity/http://realestate.aol.com/blog/2012/12/20/mortgage-refinance-boom-opportunity/http://realestate.aol.com/blog/2012/12/20/mortgage-refinance-boom-opportunity/#commentsFiled under:

mortgage refinanceThere isn't much written about the issue in the national media, where the focus is on gun violence and fiscal cliffs, but the U.S. is in the midst of a mortgage refinancing boom that should continue well into 2013.

According to the Washington, D.C.-based Mortgage Bankers Association's weekly applications survey, refinancings were up 8 percent from the first week in December and are at their highest levels since January 2009.

Overall mortgage loan application volume was up 6.2 percent, according to the MBA index, signaling a white-hot mortgage market thanks to a slightly improving economy and continued low mortgage rates.

The BankingMyWay.com Weekly Mortgage Rate tracker shows 30-year fixed mortgage rates at 3.44 percent and 15-year fixed mortgages at a rock-bottom 2.86 percent.

Adjustable-rate mortgages are at bargain basement levels. The BMW tracker has one-year ARMs at 3.20 percent and five-year ARM's at 2.53 percent.

"Continued uncertainty due to the lack of resolution regarding the fiscal cliff led interest rates lower last week, with mortgage rates reaching a new low in our survey," offers Mike Fratantoni, the MBA's vice president of research and economics.

"Refinance activity increased, with the refinance index hitting its highest level in two months, and the refinance share reaching its highest level since January 2009," he adds. "Applications for purchase increased for a fifth consecutive week, and are running almost 10 percent above their level at this time last year."

Just how excited are mortgage consumers over low rates?

The MBA says that 84 percent of all total mortgage applications are refinancings right now, with fixed-rate mortgages encompassing 97 percent of all refinancings. That's a good sign for the housing market and for the economy, as fewer people are opting for riskier adjustable-rate mortgages, which were a key negative driver in the housing market collapse of 2008 and 2009.

Mortgage rates are so low that one national mortgage lender calls the current housing market a "once-in-a-lifetime opportunity."

Plymouth Meeting, Pa.-based New Penn Financial says that you can easily snag a new home right now or refinance an existing one, even if your finances are problematic.

"It's now possible to purchase a first home or to refinance at record low mortgage rates -- even if your home has severely depreciated in value," says Bob Johnson, director of capital markets with New Penn.

Some of the interest comes from a tweak to a government-sponsored home loan program.

"The modifications made to President Obama's Home Affordable Refinance Program are another boon to many borrowers, especially those underwater on their mortgages," Johnson says. He explains that more consumers can grab a HARP loan because there is no longer a loan-to-value cap. "You can owe more than 125% of your home's worth and still be eligible," he adds.

The company reports it's seeing 30-year mortgage rates as low as 3.3 percent, and 15-year rates as low as 2.66 percent these days.

Those are ridiculously low rates, and you can make a smart financial move by locking in those low rates for the life of your home mortgage. You'll need good credit, and you'll need to shop around.

But good mortgages are low-hanging fruit going into 2013. And by all indications, it looks like things are going to stay that way.

See more on The Street:
When Retirees Should Consider Renting When They Downsize
10 Best SUVs to Buy Now
Top 5 Music Apps

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Find homes for rent in your area.

Follow us on Twitter at @AOLRealEstate or connect with AOL Real Estate on Facebook.

 

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]]>30-year fixed mortgage ratesAdjustable-rate mortgagesBankingMyWay.com Weekly Mortgage Rate trackerfiscal cliffHARPHome Affordable Refinance Programhome loan programhousing market collapseMBA indexMortgage Bankers Associationmortgage refinancingTheStreet.com2012-12-20T13:33:00 00:00Downsizing After Retirement: Should You Sell the House and Become a Renter?http://realestate.aol.com/blog/2012/12/12/downsizing-after-retirement-selling-home-renting/http://realestate.aol.com/blog/2012/12/12/downsizing-after-retirement-selling-home-renting/http://realestate.aol.com/blog/2012/12/12/downsizing-after-retirement-selling-home-renting/#commentsBy Jeff Brown

Older homeowners are often urged to consider "downsizing" -- selling the big family home and using the proceeds to buy a cheaper one and put some cash aside. But there's another downsize option that's rarely discussed: selling the old home and becoming a renter.

Clearly, this goes against the grain, as most people prefer owning to renting. But would the own-to-rent downsize ever make sense? It's worth some thought.

In a standard downsize, the long-term homeowner, typically someone in or near retirement, sells the big home in which the children were raised, then buys something that is cheaper, has lower taxes and utility costs and is easier to maintain. Ideally, the equity on the old home is more than enough for the homeowner to pay cash for the new one, and the difference goes into a rainy-day fund or investment.

But there are several circumstances that might make it pay to rent the new home rather than buy.

Related: Looking for a Rental? See AOL Real Estate's Apartment Listings

The rental, for example, requires less cash upfront than a cash purchase. Imagine you sold a $400,000 home that you owned outright and had a choice between buying a $200,000 condo or renting a comparable apartment for, say, $2,000 a month. You might get into the rental for advance rent and security deposit of $6,000. You'd keep $394,000 from the home sale (not including selling costs such as the Realtor's commission), compared with $200,000 if you bought the condo.

This could be appealing if you had a special need for that extra cash, or if you saw a juicy investment opportunity. If you were willing to risk the stock market, the extra $200,000 might grow enough to offset some of what you'd pay in rent. Of course, that investment gain should be compared to any appreciation you might get on the condo if you bought it.

Another reason to rent: You might not be sure you would stay put long enough to justify buying the condo. Perhaps you're not sure condo life is for you, or that you'll like the new community well enough or be able to handle future increases in condo fees. Or maybe you worry that deteriorating health will force you or a spouse to an assisted-living community.

In that case, renting might give you more flexibility to move on in the next few years. As a rule of thumb, it doesn't pay to buy unless you expect to stay put at least four or five years. That should provide time for gains in your home's value to offset the expenses incurred in buying and selling, such as transfer taxes and Realtor's commission.

Related: Buy or Rent? 10 Major Cities

After all, if you rent, you can easily change your mind, get out when the lease expires and rent or buy another place.

The downside, of course, is that when you rent you do not have equity, and you can expect rents to rise with inflation. Recently, rents have been going up so fast that many renters are finding it cheaper to buy. Of course, the costs of owning a home go up, too -- things such as property taxes, insurance, maintenance and any association fees.

It's a tough call, but probably boils down to this: If there's a better-than-even chance you won't stay in the new place longer than five years, renting may be the best option. If the odds favor staying longer than 10 years, buying will probably pay unless you have good reason to expect a big investment return on the cash saved by renting.

Between five and 10 years, it's a tougher call and will hinge on a detailed look at the numbers: rent and likely rent increases, purchase prices and likely increases in ownership costs, potential investment returns on cash that is not used for a purchase. Use the Rent vs. Buy Calculator to check the numbers.

One thing you can be sure of: Renting will be a loser if you squander the extra cash from your home sale. The equity freed up in a downsizing should be put to work, so it will grow -- not frittered away on fancy dinners, cars or other expenditures that have no long-term payoff.

See more on TheStreet.com:
10 Best SUVs to Buy Now
How to Get Your Gifts to Show Up on Time
Top 5 Music Apps

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
See celebrity real estate.
Find homes for rent in your area.

Follow us on Twitter at @AOLRealEstate or connect with AOL Real Estate on Facebook.

 

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]]>downsizingrent vs. buyrentingretirees downsizingretirement downsizingretirmentselling your homeTheStreet.com2012-12-12T16:00:00 00:00Weird Town Names: 10 U.S. Areas With the Oddest Monikershttp://realestate.aol.com/blog/2012/11/26/weird-town-names-10-u-s-areas-with-the-oddest-monikers/http://realestate.aol.com/blog/2012/11/26/weird-town-names-10-u-s-areas-with-the-oddest-monikers/http://realestate.aol.com/blog/2012/11/26/weird-town-names-10-u-s-areas-with-the-oddest-monikers/#commentsTowns with weird names

By Kerri Fivecoat-Campbell

Most of the more than 30,000 incorporated towns and cities in the U.S. listed by the Census Bureau have names that wouldn't get a second glance. But there are more than a few that have very unusual names -- and even some that create some snickers.

We found 10 of some of the most oddly named towns and cities, and did some digging to find out how they got their names:

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See more on TheStreet.com:
10 Best SUVs to Buy Now
How to Get Your Gifts to Show Up On Time
Top 5 Music Apps

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Find homes for rent in your area.

Follow us on Twitter at @AOLRealEstate or connect with AOL Real Estate on Facebook.

 

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]]>city namesodd city namesodd town namestown namesweird city namesweird town namesweirdest town namesTheStreet.com2012-11-26T20:00:00 00:00