Archive for the ‘Selling a home’ Category

Weigh the options to find your home’s value

Guessing the value of hand soap on a game show isn’t all that dicey, but throwing a random number on your “for sale” sign is risky if you’re trying to sell. Before you settle on a price, try one or more of these valuation methods:

Automated Valuation Methods

The Process: Automated valuation methods (AVMs) are online programs that use public home sale records, demographics and property characteristics to find your home’s value. You key in your home’s information, like the location, square footage and number of bedrooms and bathrooms, and the software returns with an estimated value.

Pros: AVMs are quick and easy, and many are free. AVMs are a great way to watch trends in value, because they gather statistics from public records.

Cons: “It’s just software, so if you have a home that’s next to the freeway, or if your neighbor painted his home purple, which detracts from your home’s value, there’s no way it can know,” says Jay Thompson, designated broker at Thompson’s Realty in Phoenix, Ariz.

The software isn’t great at nailing the specific value of your home — it might tell you your overall value is decreasing, but it might not get the actual value correct. Areas with fewer sales will be even less reliable because the pool of data is smaller.

Also, national AVMs often aren’t as reliable as local software. “They’re actually a complete waste of time in New York. What we do have are Property Shark and StreetEasy, which are local to New York,” says Wendy Sarasohn, senior vice president at Corcoran in New York, N.Y. “These two services are affiliated with the different brokerage companies, so they’re getting actual closing prices.”

Appraisals

The Process: The first step of an appraisal is a property inspection, where the appraiser takes notes about what the property has and what it’s lacking. For example, says Leslie Sellers, president-elect of the Appraisal Institute and appraiser in Knoxville, Tenn., if a home has two bedrooms and the market for the area usually demands three bedrooms, that would negatively affect the home’s value. Appraisers also look for defects in the home that buyers typically ask to have fixed before they sign on the dotted line.

Then the appraiser sits down and crunches the numbers, comparing the house to others that have recently sold or are for sale in the neighborhood. “If it’s bigger than a house that sold, we might adjust the price upward…if it’s smaller, we would adjust it downward,” explains Sellers.

Next, the appraiser gives the homeowner the facts: Information about the homes in their area competing for buyers, a list of things that may add value and appeal to the abode and, of course, a recommended listing price.

Pros: “Appraisers are disinterested and objective,” says Michael H. Evans, a Fellow of the American Society of Appraisers and owner of Evans Appraisal Service in Chico, Calif. “A broker is trying to get a listing, whereas we’ll tell you the truth whether you like it or not.”

Appraisers can also discover problems that could delay a sale before you put your home on the market. For example, if an appraiser notices you’ve added square footage without a building permit, they’ll send you to the building department to resolve the issue before you sell.

Cons: No appraiser is going to assess your home’s value for free. The home review will cost between $200 and $500, depending on what part of the country you’re in.

Also, not all appraisers are created equal — people that are inexperienced or new to the area might not have the breadth of knowledge necessary to pinpoint your home’s value. When looking for an appraiser, be sure to look for someone licensed at the state level and accredited by a national professional organization, like the American Society of Appraisers or the Appraisal Institute.

Comparative Market Analysis (CMAs)

The Process: After looking at the house, agents usually start the process with a look around the neighborhood for “comps,” or comparable homes that were recently (usually in the past three months) sold in the area. In suburban areas, comps usually come from the half-mile radius around the house.

In especially dense areas, like New York City, where a $25 million pre-war co-op could be a block away from a building full of $2 million dollar post-war apartments, comps typically come from inside the apartment building, says Sarasohn.

In a falling market, it’s equally important to look at pending sales because they are the future comps for the house. “Sometimes the agents will tell you the sale price, sometimes they won’t, but you can use a median of the sale prices to see where things are going,” explained Elizabeth Weintraub, broker associate at Lyon Real Estate in Sacramento, Calif. You can then adjust down a percentage based on the softer market.

In a foreclosure-heavy city, that can also play a part in the agent’s recommended sale price. “One other foreclosure in the neighborhood doesn’t really affect your price, but when 4 out of 5 sales in the neighborhood is a foreclosure…those are the comps,” says Weintraub.

Sarasohn also asks six or seven colleagues from other firms to price the home. “Sometimes I’ll say whoever gets closest to sale price gets some kind of award, like house seats to a Broadway play or gift certificates, so there’s an incentive to think about what they’re saying,” she says.

Pros: CMAs are typically a free service, and you can (and should) get the numbers from multiple agents before you choose a listing agent. Agents have access to the same information and records as appraisers, but typically don’t provide as much detail in their report, says Dee Hake DeMolen, a broker and realtor in Dover, Del.

Cons: Real estate agents have a motive for doing a CMA for free — they want to list your home. As a result, some will recommend you list your home at a price higher than the market rate in an effort to get your business.

“I always encourage sellers to list the apartment where we think the market is, but sellers make the mistake of saying, ‘Well, another broker said could get me X amount.’ No broker can determine what they can get — the market determines that,” cautions Sarasohn. To avoid this, get estimates from three agents at three different companies, and don’t necessarily choose the highest offer.

Also, some agents are better at doing CMAs than others. To make sure you’re getting the right information, ask each agent to explain their process so you can understand how they’re crunching the numbers.

From HGTVFrontDoor

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

Homeowners who are looking to remodel their kitchen should keep the following factors—that can significantly affect the price of their remodel—in mind as they begin to make plans to upgrade their kitchen. According to Kitchen Tune-Up, homeowners should pay attention the following five factors before they begin a renovation.

1. Wood species or cabinet covering material. The material that covers the cabinet will effect the overall pricing of a kitchen renovation, but not as much as you might think. A stainless steel clad cabinet will be the most expensive and a melamine (thin plastic laminate) surface will be the least costly. Cherry is usually about 7-10% more than oak, while hickory, oak and pine usually run very close in price. Unusual cabinet woods like alder, mahogany, fir, rift cut woods, redwood, teak, etc. will usually cost more than common oak or pine.

2. Kitchen layout. The layout of the kitchen and the cabinet configuration will largely affect the price of a remodel as well. For example, a lazy susan will cost more than a sink cabinet, a stack of drawers will be higher priced than a one drawer/two door base cabinet, a U-shaped kitchen costs more than an L-shape with an island and a wall oven/cooktop combination makes the kitchen cost about $1,000 more than a free standing range. Setting a budget to design within can often save homeowners many hours of re-design.

3. Cabinet door style. A door with many details will usually cost more than a simple door. If an arch is added to a square panel, homeowners can expect to pay more. A door with lots of grooves or molding generally cost more than a simple door and a full overlay door (door that covers almost the entire cabinet face) costs more than a traditional overlay door. Doors set inside the cabinet frame (called inset) cost more than doors that are mounted over the cabinet frame.

4. Type of cabinet finish. The type of cabinet finish you choose will vary the pricing of a kitchen remodel as well. Painted cabinets will run 10-15% more than a standard stain finish and glazes or layered finishes will run 7-15% more than a standard stain due to the extra labor.

5. Cabinet construction methods and materials. Don’t skimp in the area of cabinet construction in order to save money on your kitchen renovation as better construction methods make a kitchen durable. In fact, cabinet construction may be 60% of the entire cabinet cost.

From RIS Media

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

Kendra Todd, host of My House Is Worth What?, tells you how to set your home apart and get the maximum price for your property.

Liven Up the Landscaping

Not only does good landscaping give you the highest return on your money, but it also can literally transform the exterior look and feel of your home. Hire a landscaper to do the job, or do it yourself for some old-fashioned sweat equity. Either way, be sure to turn your front yard into a colorful, floral oasis.

Enhance Your Exterior Entryway

Make your front door the centerpiece of your home’s curb appeal. Repaint it a striking, tasteful color, or sand it down and stain it for an antique, weathered look. Finish the look with updated lights, potted plants on either side of the door and a new, high-end knocker and handle.

Have a Welcoming Walkway

The front walkway is essential to drawing the buyer in the door, so it’s got to pop. You’ll get points with buyers for installing a high-end material such as brick pavers. If your pathway is curved, accentuate the movement by lining it with lights or flowering plants.

Freshen the Foyer

What do people see first when they enter your home? Consider that the foyer is the first impression of your home’s interior, so make sure it doesn’t block the line of sight to any marketable rooms or views. Remove bulky furniture, paint it a neutral color, upgrade the lighting, and have fun with things like high-end entry tile or even marble flooring.

Light It Up Right

The right lighting can make a small home appear larger or a dark home seem sunny and cheery. The wrong lighting can make your home feel dark and dreary. Installing brighter, modern light fixtures not only highlights your home’s best features, but the right style of fixtures can also create a more current look.

Neutralize With Paint

Paint color is a personal choice, and potential buyers will probably want to customize it for themselves when they move in, but that’s no reason not to paint when selling. You are out to showcase your home in its best light, right? Don’t fall into the “white or beige” trap, but also avoid rich, dark colors as those don’t appeal to everyone. Think about richer colors with wider appeal, and don’t forget to focus on the details: window and door trim, baseboards and crown molding.

Update Fixtures, Hardware

Avoid major kitchen and bathroom overhauls if you are ready to sell. Instead, highlight the existing good features by tackling small tasks such as updating the lighting and installing new faucets, nozzles, mirrors and cabinet doorknobs. You’ll be surprised how big an impression these small, relatively inexpensive updates will make.

Repaint Cabinets

Replacing or even refinishing cabinets can be costly and therefore risky if you dump a ton of money into your place right before you sell. A quicker and less expensive way to recoup your costs and still modernize your home is to repaint the cabinets. It’s incredible to see how a coat of paint can transform the entire look of your kitchen or bath.

Don’t Forget the Flooring

Flooring has one of the most dramatic effects on the size and appeal of your home, and you get a great boost in value if you choose the right materials. If you have worn, stained carpet or vinyl flooring, rip it up quickly and replace it with tasteful tile, wood laminate, or, if your market allows, nice hardwood floors.

Create a Backyard Oasis

What do buyer’s see when they walk out back? A vacant slab of concrete? A rarely used covered pool? Transform your backyard into an entertaining space, so the buyer can visualize all the good times they’ll have out there with neighbors and family. Buy some inexpensive patio furniture, a grill and some potted plants to fill extra space and tie it all together. Install some outdoor lighting as the finishing touch. By the time you’re done, you’ll wonder why you didn’t do it sooner.

Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings

A vacant house is like a vacant stare. Something is just not right. Trying to sell a vacant house adds obstacles and depresses the sales price, says Showhomes, a nationally franchised home staging company.

Showhomes uses live-in home stagers to lower the cost of staging and produce faster home sales. Take a look at their top five reasons why selling a vacant house is often a mistake in today’s market:

1. People don’t simply buy houses; they buy the next chapter of their lives. This is an emotional experience and emotion influences what people buy and how much they will pay. Vacant houses are devoid of life, and the chance to make an emotional connection is lost.

2. Vacancy distracts buyers from looking at the house itself. They wonder: “Is this a divorce? Why did they move out? Are they selling because they have money problems? Is this home hard to sell?” They’ll make a low-ball offer, thinking the owner is desperate.

3. When a house is vacant, buyers focus on flaws. They look at nail holes, carpet wear and gaps in the molding rather than how the space works. In a vacant house, floors, walls and ceilings are all the buyers see. This drives the price down.

4. People can’t visualize how furniture fits. An empty bedroom might appear awkward or a living room might seem cavernous. Some spaces might confuse buyers because a use is not obvious. Buyers are derailed and move on to the next house.

5. Vacant houses don’t show as well as staged and occupied homes. Without people, even the best home quickly looks and smells vacant. Dust settles, leaves scatter, and stale smell spreads. These cues often shorten the showing time, leading to fewer sales. “Home owners don’t realize how much harder a vacant home is to sell.

In today’s market, you have to win the beauty contest,” says Thomas Scott, VP of Marketing at Showhomes. “Vacant houses simply underperform staged homes and the increased sales price provides an excellent return on what staging costs. Choosing to stage your home should be an easy decision in today’s market.” For more information, visit www.showhomes.com.

Copyright© 2010 RISMedia

Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Check out Valerie Fitzgerald Beverly Hills Real Estate Listings

Raising kids is expensive, but the tax laws can ease that burden, according to CCH, a Wolters Kluwer business and a leading provider of tax, accounting and audit information, software and services. From birth through college graduation, there are breaks that reduce taxes and help defray the costs of education. Here are ten ways that tax codes can benefit parents:

Personal Exemption – A reduction of taxable income of $3,650 ($3,650 in 2010) for each dependent child under age 19 or, if a full-time student, under age 24. For divorced parents filing separately, generally the exemption goes to the parent who has custody for the greater part of the year.

Child Credit – A reduction of tax of $1,000 per child, beginning to phase out when adjusted gross income (AGI) exceeds $75,000 for single filers and $110,000 for joint filers. May be partially refundable, depending on income.

Childcare Tax Credit – A credit based on childcare expenses for children up to age 13, or older children if they are physically or mentally incapable of caring for themselves. Credit taken against maximum qualifying expenses of $3,000 for one qualifying dependent and $6,000 for two or more. Credit equals 35% of qualifying expenses for taxpayers with AGI up to $15,000 and decreases with income to 20% of allowable expenses for AGI of $43,000 or more.

Adoption Credit – A maximum credit of $12,150 for a regular adoption, with credit amounts phased out at incomes between $182,180 and $222,180 for both single filers and joint filers. For a special-needs adoption, the credit is figured without regard to the actual expenses paid or incurred in the year the adoption becomes final.

Earned Income Tax Credit (EITC) – Amounts increase for eligible taxpayers with children. Size of increase depends on income level, number of children.

Coverdell Education Savings Accounts (ESAs) – Earnings in these accounts grow tax-free. Withdrawals also are tax-free if used to pay for qualified educational expenses. Can be used to pay for tuition, fees, books, supplies and equipment for both K-12 and post-secondary. For K-12, can also pay for uniforms, transportation, supplementary items and services such as extended day programs, room and board and purchase of computer technology and Internet access. Contributions limited to $2,000 per year.

Qualified Tuition Programs (529 Plans) – Investment earnings in these plans are not taxed if withdrawals are used for qualified expenses. Contributions to state-sponsored programs are partially or fully deductible on some state tax returns. Annual contribution limits for the plans are set by the state or educational institutions sponsoring the plan and may be in excess of $300,000, but a contribution in excess of $65,000 by any individual ($130,000 for joint filers) in one year could restrict those persons’ ability to make additional contributions in further years without being subject to gift tax.

Bond interest – For 2009, interest on proceeds of qualified savings bonds (specifically, Series I bonds or qualified Series EE bonds issued after 1989) cashed to pay education expenses is tax free for joint filers with less than $104,900 in AGI, partially tax free for AGI of $104,900-$134,900; comparable limits for single filers are $69,950-$84,950. For 2010 returns, phaseout ranges are $105,100-$135,100 for joint returns, $70,100-$85,100 for single filers.

Higher Education Tuition Deduction – An above the line deduction for qualifying educational expenses of up to $4,000 at an accredited post-secondary institution. The deduction is reduced to $2,000 at AGI above $65,000 ($130,000 for joint filers) and is not available if AGI exceeds $80,000 ($160,000 for joint filers). This must be coordinated with other educational exclusions and cannot be used for anyone for whom the American Opportunity Tax Credit or Lifetime Learning Credit is claimed.

American Opportunity, Hope and Lifetime Learning Credits – For 2009 and 2010, the American Opportunity Credit virtually replaces the Hope and Lifetime Learning credits for undergraduate expenses, providing a credit of up to $2,500 per student per year for the first four years of post-secondary qualified tuition and expenses. Up to 40% of the credit is refundable, depending on income. Residents of Ark., Ill., Ind., Iowa, Kan., Mich., Minn., Miss., Neb. and Wis. who are in the “Midwestern Disaster Area” might do better choosing the Hope Credit for 2009 expenses.

For more information, visit www.CCHGroup.com.

Copyright© 2010 RISMedia.

Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business. Buy it here.

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