Inside a Beachy Apartment on Brooklyn's Waterfront

STORY / BY DOUGLAS CALHOUN 

For many people, summertime means heading out to soak up some rays in the Hamptons, taking a dip at the nearest idyllic borough beach, or hanging out at a backyard BBQ. But theater producer Kate Russell and her partner Colin Moneymaker share a year-round beach bungalow — which just happens to be in Brooklyn’s Greenpoint neighborhood. Car horns and street chatter can’t be heard form this garden-facing abode, so there’s no disruption of the home’s island-getaway vibe.

The couple found the main room’s mounted drift wood on a trip to Maine and affixed it to the wall to remind them of their travels. It acts as both keepsake and one-of-a-kind sculpture. Below it, a small antique school desk plays DJ, holding a modest but well-played record collection. Tucked inside are a few favorite titles and a seashell, a memento of a day by the water.

Kate and Colin’s combined design aesthetic is cool and collected. Colin works in downtown Manhattan, and Kate is a freelancer who works from her home office. A simple desk in the living room is where she’s put into motion her most recent project: launching a theater company, and fundraising for its first production. Coincidentally, given Kate’s seaside-inflected home decor, the company’s inaugural season kicks off with an original adaptation of the classic maritime novel “Moby Dick.”

A laidback look

The Moroccan and tie-dyed pillows paired with colorfully patterned rugs against blond wood pieces and a modern couch help to communicate a relaxed style. The combined textures are thoughtfully chill, and reminiscent of overlapping beach towels on the sand.

White shelves, built by Colin, hold photographs capturing time spent with family, intermingled with artifacts found along the way and quaint stacks of treasured natural elements like stones and driftwood.

Colin takes great pride in his city garden. Plant life along all the windowsills evokes images of a beautiful reef or cliff-side bluff. Some of the couple’s favorite plants are sourced at nearby Homecoming on Franklin Street, a charming cafe and lifestyle store, and a haven for the neighborhood’s urban gardeners.

When trying to achieve this look, remember to balance color and space. It’s a memorable home because it’s personal, but still minimal. In the absence of clutter, there are keepsakes.

Taking a lead from nature itself, only a handful of simple pieces make the space sing. But Kate and Colin manage to bring the staycation home, and set a course to the welcoming space where they’ve dropped anchor.

Shot on location by Kristen Blush. Prop help by Patina Rental and styling/project management by Douglas Calhoun Events.

article courtesy of: http://www.zillow.com/blog/beachy-apartment-brooklyn-179452/

Edible Landscaping: Ornamental Plants You Can Eat

STORY / BY STEVE ASBELL 

Have you ever wanted to grow your own kale, cook with fresh herbs or pick your own berries? You don’t have to sacrifice your neatly maintained landscaping to grow your own food. And with a little finesse you can even make the edibles in your front yard attractive enough to fool your HOA.

Growing your own food is worthwhile for many reasons. Apart from the obvious benefit of getting food out of the deal, you’re also getting a much tastier tomato than you’d find in the produce aisle. Many of the vegetable varieties you can grow at home are more flavorful, attractive and unique because you have thousands of hybrids and heirlooms at your disposal.

Cook authentic Italian cuisine with Genovese basil, Tuscan kale, San Marzano tomatoes and a host of heirloom squashes and eggplants. Replicate Southeast Asian recipes perfectly with lemongrass, galangal, turmeric, lemon basil and bitter gourd. You just can’t get produce like that at the grocery store, and it couldn’t be any fresher than picked from your own garden.

Kale is an attractive plant in its own right, but purple kale takes the cake.

Not convinced that growing edibles in your landscaping is right for you? Here’s the kicker: Edibles, for the most part, are actually attractive plants if you use them correctly.

Many edible plants are just as beautiful as flowers. Take the humble and unassuming bean, for example. The common pole or bush beans on the seed rack may be boring, but the ‘Italian Rose’ bean’s intense pods of mottled rose and chartreuse beg to differ, and the ‘Red-Podded’ asparagus bean’s two- to three-foot-long pods of purple tenderness are anything but bland. You would be forgiven for seeing a fence covered with colorful heirloom beans from a distance and thinking they were flowers.

Making the most of edibles

Despite the potential beauty of edible landscaping, many skeptics associate it with ugly vegetables — whether it’s because the plants are infested with bugs, diseased and yellowed, declining at the end of the season or just plain weedy looking.

Tomatoes are a good example, since they often neatly demonstrate all of these problems. Plant rangy, indeterminate tomatoes and sprawling cucumbers, squashes and beans against strong trellises so they are easy to maintain and don’t look like weeds intent on taking over the neighborhood.

If you’re growing vegetables in the front yard, choose those that are tough, easy to maintain and ornamental. You could get away with cucumbers and cherry tomatoes in the front yard, but if you have a backyard, you may want to grow them there and leave it to prettier plants to seduce the nosy neighbors out front.

Incorporate edibles like this variegated ‘Centennial’ kumquat in the garden as you would use any other drop-dead gorgeous plant.

Have your pick

There are two ways to make edibles look lovely in the landscape. The first method is to simply incorporate them into your flower beds as if they were ordinary plants — provided the plants are easy to access for maintenance and harvesting.

Plant colorful and frilly loose-leaf lettuce cultivars in the flower beds, making sure they can be easily accessed for periodic picking. Low-growing herbs like oregano and thyme are perfect for growing along the edge of the flowerbed, where their fragrant and easy-to-pick foliage can add dimension and suppress weeds.

If you’re looking for something more substantial to use at the back of the flowerbed or as an accent, try tall and structural vegetables like lacinato kale, garlic, walking onions and eggplants.

Roselles produce showy flowers and juicy, tart calyces.

For a huge and show-stopping plant with large, tropical-looking leaves and hibiscus-like flowers, okra and roselle are a must. Both are hibiscus relatives that love the summer heat. Okra is grown for its fresh-tasting green pods, and roselle for its tart and juicy red calyces (the petal-like part).

Rows of veggies can be boring, but not if you plant them at a diagonal angle.

The second approach to edible gardening is more formal, and relies on structural elements like raised beds, low boxwood hedges, espaliered fruit and trellised vegetables. If you own a home built in the Victorian or any other traditional style, the formal approach may be for you.

While incorporating veggies into your existing garden beds is subtle and sneaky, the formal approach is about as obvious to your neighbors as it gets. Make sure you check with your HOA before attempting raised beds or vegetable rows in the front yard. (Check with your spouse, too. Trust me on this.)

Take care

However you choose to grow your edibles ornamentally, remember that they are not very ornamental at all when their leaves are cut into Swiss cheese by bugs and infested with a moldy-looking patina of downy mildew. Luckily, there are ways to keep your edibles looking awesome.

Grow them in full sun, give them rich and fertile soil, fertilize according to label instructions, inspect often for bugs and disease, and treat accordingly.

If a plant is looking particularly terrible, just rip it out and try something else in its place. With thousands of varieties, hybrids and heirlooms to purchase from catalogs or online, you’ll surely find something outstanding.

article courtesy of: http://www.zillow.com/blog/edible-landscaping-179546/

5 Mistakes That Delay Mortgage Approvals (and How to Avoid Them)

TIPS & ADVICE / STORY / BY ZILLOW TEAM ON 31 MAR 2015

One of the hardest parts of getting a mortgage is interpreting advice from all the parties involved: mortgage lender, real estate agent, insurer, attorney or escrow officer, tax adviser, financial adviser, plus your family, friends and colleagues. Since your mortgage lender is involved in all parts of a financed home purchase, an ace lender can be your best guide.

Here are the five common mistakes that can cause hiccups in your mortgage process. Ask your mortgage lender to help you steer clear of them.

1. Excluding details of your financial profile

A good mortgage lender will begin by reviewing your basic personal and contact information, employment and residence history, income, assets and debts.

Simple, right? Only if you answer every question, whether it’s in person or on a form. If you don’t provide absolutely every detail about your financial profile, it can throw off the entire loan process.

2. Not providing every single piece of documentation

Next your lender will ask for detailed documentation for your entire profile, including:

• 30 days of pay stubs
• Two years of tax returns and W-2s
• Year-to-date business financial statements if you’re self-employed
• Two months of statements for all asset accounts
• Explanations and paper trails of all deposits (and often withdrawals) above $1,000
• A home insurance quote with adequate coverage
• Full financials on any other homes or businesses you own

If one single page of any piece of documentation is missing, you’ll be asked to provide it. If your income is commissioned or variable in any way, you must authorize your lender to verify income directly with current and past employers.

The lender will also run your credit, which can reveal employers, addresses, debts and other credit inquiries that you didn’t disclose. If new information comes to light, you’ll be required to explain and document all of it.

3. Confusing approval with pre-approval

Misinterpreting approval status kills deals and can take years off your life. So remember this and live long in your new home: get your loan approved by an underwriter before you write any offer to buy a home.

Getting a mortgage “pre-approved” means you’ve talked to a lender (#1 above), or you may have even provided some documents (#2 above) and been told your profile looks good — but make no mistake, this isn’t a loan approval.

Be sure you ask to get “underwriting approved” and obtain a formal loan commitment in writing. Anything short of this means your profile has been evaluated, but your actual loan approval doesn’t officially begin until your loan agent submits your file to an underwriter.

4. Not sharing home offer details with the lender

The purchase contract — or offer you write on a home — dictates critical transaction timing milestones like how many days you have to secure loan approval and how many days you have to close.

Your real estate agent will take the lead here, but make sure your lender and agent are in sync, because the lender must provide these critical milestone dates that your agent writes into the contract.

If you miss either of these dates in your contract, you risk losing your initial deposit on the home. The only way your lender can provide accurate timelines is if they’ve executed all the steps above properly.

5. Being unrealistic or uninformed about rates

When a seller accepts your offer, you’re in contract to buy your home and ready to lock a rate for your mortgage. You can’t lock before you’re in contract because a rate lock runs with a borrower and a property.

This means you’re subject to rate market movement until you’re in contract, and rates change throughout each day as bond markets trade. Rates are priced based on how long they’re locked, so a shorter lock (such as 15 or 30 days) has a lower rate than a longer lock (60 days, for example).

To avoid rate surprises, ask your lender to quote rate locks based on your closing timeline. And don’t forget that if you’re cutting it close on qualifying and rates rise, the resulting cost increase can kill your loan approval. Ensure your lender is accounting for the possibility of higher rates so your loan approval remains valid if rates rise while you’re home shopping.


article courtesy of: http://www.zillow.com/blog/5-mistakes-delay-mortgage-approval-172810/

Are You Paying Too Much Property Tax?

STORY / BY VERA GIBBONS 

When tax time rolls around, many homeowners are surprised at the amount of property tax they owe. If you disagree with the stated value of your property, it’s worth a closer look to see if your bill has increased fairly.

To be sure you’re not paying more than you should, check the following factors.

Basic errors

First, verify that there are no mistakes on your property card — a document that records information such as dimensions, acreage and value. Does the card show that your home has three bedrooms when it only has two? That it sits on 3.0-acre lot when it’s only on .30? That it has a finished basement when, in fact, it doesn’t? That it has two fireplaces when it only has one?

Errors like these can — and do — occur, and they’re actually quite common. But you won’t know about discrepancies if you haven’t seen your home’s card and reviewed it carefully. Get a copy at the town hall, bringing any errors to the immediate attention of the assessor. Adjustments can often be made without the need for a formal appeal.

Comps

After you pull your home’s property card, take a look at a few of your neighbors’ cards — specifically, neighbors who have homes that are similar to yours in terms of age, size, style, condition and location.

How do their assessments line up with yours? Maybe your four-bedroom house with a one-car garage has been assessed at $250,000. Your neighbor also owns a four-bedroom home, but this house has a two-car garage, a nice little shed, and even a swimming pool — and yet it’s valued at $235,000. Make a case, as you likely have one.

Unique conditions

Do you live in a home that’s in deteriorating condition? In a neighborhood that’s undesirable due to strange smells, poor air quality or heavy street traffic? These are the types of factors that could lower your property’s value.

Improvements

Prior to construction, you may have had discussions about how much that new pool or deck was going to cost you in terms of property tax. After all, you needed to know what to expect, and just how much higher the bills were going to be.

But here’s the thing: Maybe those structural improvements never came to fruition or are not yet completed, and yet your bill reflects these assessments as if you’ve been enjoying them. Speak up and save!

Exemptions

Are you taking advantage of special exemptions? Some states offer tax reductions for veterans, the disabled, and senior citizens. Some also provide reductions for historic buildings and special energy-efficient systems. Ask about these — and other incentives for tax reductions — that you may be eligible for. It’s worth a shot.


article courtesy of: http://www.zillow.com/blog/paying-too-much-property-tax-173061/

5 Reasons to Keep Your Lender in the Loop When You Make an Offer

STORY / BY ZILLOW TEAM 

Of the many things that can trip you up when buying a home with mortgage financing, writing offers is one of the most common.

When you’re finally writing a home purchase offer (also called a purchase contract) after a long home search process, it’s easy to forget about your lender in the excitement. However, your lender must be involved because of these five ways purchase contracts impact the lending process.

1. The purchase offer must match loan documents

Names in the “buyer” section of your offer must match the names on the loan application exactly. This small but critical detail can delay or kill a deal.

For example, if your significant other is out of town when you’re writing the offer, your real estate agent may advise you to write it solely under your name. But if your loan application has both names, the lender will require you to add that missing person and have everyone, including the seller, re-sign the contract.

Or worse, if you use an entity like a trust or a business as the buyer, you’ll be forced to change the contract to human buyers that match the loan application. Mortgage loans must be made to humans, and you can transfer to entities post-close if that’s your goal.

2. The lender must approve home inspections you request

Your offer contract will ask you to select which home inspections you want. Appraisal inspections are required by lenders. Optional inspections include contractor, structural, engineering and pest.

Not all lenders will ask to review and approve every optional inspection report, but they study contracts and other property documentation (like listings on Zillow and local MLS sites) to look for red flags that may cause them to request a certain inspection report.

For example, if a public listing noted that a seller had already obtained a pest report and it contained $5,000 worth of repairs, the lender will require that pest report for review, and they’ll also require that the repairs are completed prior to approving and closing your loan, which can create timing issues. Mapping this out with your real estate agent and lender before you submit your offer enables you to execute the rest of the process with ease.

3. The lender must be able to perform on your closing timeline

Your purchase contract must state how fast you can close. In low-inventory markets where sellers have the upper hand, buyers who can close fast get the most attention.

You need your lender’s input on closing timing. They’ll tell you how long it will take to appraise the property, review title history, approve the condo project (if applicable), and finish approving you, if they haven’t already. All you have to do is tell your real estate agent to get the timing from your lender.

4. The lender must be able to perform on your due diligence timeline

Another critical point in contract timing is requesting how many days you need for each stage of due diligence, like completing your appraisal, securing your financing, approving seller disclosures, and completing inspections.

These “contingencies” protect you by enabling you to break the contract until you’ve released them. Just like with the closing timeline, sellers respond well to speed, so make sure your real estate agent is discussing timing of each contingency with your lender before you write and present the contract.

5. The lender must approve credits you ask for

Often real estate agents will advise buyers to seek a credit from the seller at closing in lieu of reducing a purchase price. A seller credit enables buyers to negotiate better terms for themselves while also conserving cash because the credit will be used to offset closing costs.

You can ask for credits in the beginning, but often they’re requested after an inspection reveals a minor property issue such as scuffed walls or damaged window screens.

In these cases, your lender will require a contract addendum (signed by the buyer and seller) to show the credits, which the lender must approve before having the appraiser amend the appraisal report to reflect the credit. These tasks can take two to six days for a lender to process, so you must keep the lender in the loop on all credits from the seller, real estate agents, or any other third parties.


article courtesy of: http://www.zillow.com/blog/keep-lender-close-when-making-offer-173153/

How to File a Renters Insurance Claim Without the Headache

STORY / BY HOMEINSURANCE.COM 

By Shannon Ireland

What would you do if someone broke into your apartment or rental home and stole your belongings? Or if a fire damaged your possessions? If you’re one of the estimate 37 percent of renters with renters insurance, you should be in good shape — if you successfully manage the claims process.

Relax, it’s not that hard. Here’s a look at the process, and tips for getting the most out of your policy so you can file a claim stress-free.

If a break-in has occurred

Contact the police so you can start the process of filing a report. While you’re waiting for officers to arrive at your home, take inventory of the damage and the items that are missing.

Once you’ve filed your police report, contact your renters insurance provider and begin the process of filing a claim. You’ll need the number of the police report, as well as:

• Your insurance policy. It will contain information about your deductible and coverage.
• Photos of the damage incurred during the break-in. It’s important that you keep the damaged property rather than disposing of it. The claims adjuster likely will want to see it.
• Your home inventory. This is a list of the contents of the apartment or rental home, complete with photos and, when available, receipts. You can still file a claim if you don’t have an inventory, but the process could be longer and more cumbersome. If you haven’t done an inventory, complete one before trouble strikes. An inventory checklist can help make this task easier.

Be sure to notify your landlord of the break-in, particularly if there is damage to the structure of the home or apartment. Your landlord’s insurance will be responsible for that.

Other reasons for property loss and damage

If you’re the victim of fire or damage from wind or hail or another covered peril, contact your insurance provider immediately to begin your claim and start assessing the damage to your possessions. Again, that home inventory can really help. Follow these other steps:

1. As with a break-in, take plenty of photos to document the damage to your possessions. Don’t get rid of the damaged items until a claims adjuster gives you the OK.
2. Keep a record of receipts for any expenses or repairs associated with the loss. If you must relocate for repairs, your policy could provide for reimbursement for extra expenses.
3. Let your landlord know about the damage. Temporary repairs to prevent further damage are OK, but ask him or her not to proceed further until the adjuster has investigated the claim.

Once you’ve filed your claim, ask how long it will take to process it so that you can tackle the next steps in a timely fashion.

Get estimates and meet with the claims adjuster

Depending on the specifics of your policy, you could be reimbursed for the replacement value or the actual cash value of your stolen or damaged possessions. Replacement value reimburses you for the full cost of the item, while actual cash value takes depreciation into account. Either way, get replacement and repair cost estimates for your possessions.

Start the final phase of the claim process by meeting with a claims adjuster, who will investigate your claim to ensure its validity, approve or veto the claim, authorize payment action and approve requests for temporary living arrangements.

Settling the claim

Before signing the documents to settle the claim, review it in its entirety. It’s a good idea to have a lawyer look it over.

If you’re not clear on any of the language or information presented in the claim document, ask questions. Now is the time to contest things. Once you’ve signed off on the settlement, keep a copy of the settlement documents for your records.

Filing a claim isn’t difficult, but it’s important to do it correctly. Follow these steps to simplify the process. And be happy that you’re not one of the 63 percent of renters who don’t have insurance.


article courtesy of: http://www.zillow.com/blog/how-to-file-renters-insurance-claim-173278/

Time-Saving Packing Hacks for Your Next Move

STORY / BY MOVING.TIPS

By Manuella Irwin

As moving day approaches, the idea of packing all your household belongings can be daunting. It’s one thing when you a have a few hours to pack a suitcase for a trip, but moving from one home to another takes packing to a whole new level.

When you’re ready to get started, some careful thought and a creative approach can help save you both time and money.

Begin with basics

Planning the packing of your home will ensure that you waste no time in the process, and achieve maximum results with minimum resources and effort. Make a schedule based on the time left until your move, so you don’t end up packing everything on moving day.

This is the time to prove yourself as a strategic thinker. Divide your household items into groups based on the room they’re located in, material they’re made of and frequency of use.

Start with the items you use rarely, and don’t mix items from different rooms, or items of different types, such as liquids with clothes. And when it comes to packing very high-priced items, don’t try to save money on your move by cutting out professional movers. It may be worth it to have some help.

Packing is a natural time to discard or donate items you no longer need — but be sure to keep a balance between emotion and logic as you make your choices. This principle may be hard to follow, but do your best to adhere to it. During your household purge, get rid of anything you won’t use anymore.

As you pack, create an open-first box with vital items you’ll need in hand as soon as you arrive at your new home, such as a first-aid kit, basic toiletries, towels, a change of clothes, a tool kit and a flashlight.

Think outside the (moving) box

Don’t spend time and money on buying packing supplies until you take stock of what you already have. Your home is full of free packing materials, such as clothing, bed linens, pillows, laundry bins and suitcases. There are many unconventional ways to use these items:

• Enlist linens, towels and socks to protect glassware inside boxes.
• Wrap dishes in T-shirts, or insert Styrofoam plates in between yours.
• Pack books inside suitcases to make them easier to carry.
• Wrap shoes in shower caps and stack them in a medium-size box.

It’s in the bag

The secret weapons for painless packing are probably right under your kitchen sink. Garbage bags, plastic wrap and sandwich bags have a multitude of uses.

• Use cling wrap to keep necklaces and bracelets from tangling. Lay a few pieces of jewelry on a length of plastic wrap and fold the wrap over. Press around your items to keep them separate.
• Don’t pull clothes off the hangers — instead, make a hole in the bottom of a garbage bag, and put the hooks of several hanging pieces through the hole. Pull the bag down over the clothes, and cinch the drawstring at the bottom tight. Voilà! Unpacking will take only minutes.
• Cover shampoos and other liquids with plastic wrap before putting the top on.
• Leave light items in dresser or desk drawers, and stretch plastic wrap firmly over the drawer.
• Store all screws and bolts in securely closed sandwich bags.
• Put pillows and blankets in garbage bags and seal them. When you load the truck, use them as padding between furniture or breakable items.

Electronic engineering

Make wiring diagrams for hooking up your entertainment system and computer, so you can connect them easily in your new place. Labeling cords and taking pictures of the setup will help, too.

Organize cords and cables by wrapping each one and stuffing it inside an empty toilet paper roll.

If possible, pack all electronic devices in their original box with enough cushion, and no empty spaces within the box.

Easy reading

Don’t underestimate the importance of labeling. You probably don’t have an army of helpers standing by to help you unpack and organize all your goods, so labels are essential to finding items fast.

Be sure that all boxes containing breakable items are clearly marked as fragile.

Packing can be a tedious and time-consuming task, but if you approach it cleverly, the results may surprise you.


article courtesy of: http://www.zillow.com/blog/time-saving-packing-hacks-173648/

5 Questions to Help You Find the Right Buyer's Agent

STORY / BY BRENDON DESIMONE

The relationship between buyer and seller is one that could last a very long time. The dynamic home-buying process can take unexpected twists and turns, so having the right agent by your side makes all the difference.

Unlike a seller, who signs an agreement with an agent, a buyer rarely has anything in writing that binds them to an agent or requires an agent to perform particular tasks. This makes it important to choose the right agent, instead of just jumping in with the first one who comes along.

What’s most important is to go with your gut. This person will be a significant presence in your life while you search for a home. Above all, you must feel comfortable with them.

Here are some questions to ask a buyer’s agent before you start working with them.

How long does it take typical buyers you’ve worked with to find a home and close?

If he tells you that his typical buyers move quickly, within weeks or a month, he is probably used to working with buyers who’ve done a lot of independent research prior to engaging the agent. If he says it’s more like a year or longer, he is likely more patient and lets the home-buying process run its course.

In which towns or neighborhoods do you do the most business?

Agents tend to focus on where and what they know. Most have a solid knowledge of a few towns, and then a cursory knowledge of nearby areas.

Your home search can take you through multiple towns and school districts. If you start working with a real estate agent you meet at your first open house, and she only truly works in that town, someone else for another area may better serve you. But its better to have one agent throughout the process, which is why good agents typically cover a broader geography.

Do you work independently or with a team? Do you have an assistant?

Home buying is incredibly personal, so you want to make sure you know who you’ll be working with. It’s helpful to have the same person by your side during the journey so they can track your experience.

Ask your agent what her arrangement is and make sure you are comfortable with it. If she works with assistants or junior agents, make sure you won’t be pushed off to someone with less experience.

How do showings work?

There are multiple ways to see properties, and the most effective approach is different for every buyer and in every market. Some markets rely heavily on open houses, where buyers can see the home on their own. Others require private appointments or the use of a lock box to see homes. If the agent prefers that you leverage open houses as much as possible, but you desire a little more handholding, she may not be the agent for you.

How do you search for properties, and what’s the best way to collaborate or communicate?

Buyers don’t rely only on their agent to find properties anymore. What’s more, many agents encourage buyers to search online independently. Agents leverage their local multiple listing service (MLS), and will send buyers emails and alerts from there.

Good collaboration makes for a seamless process, so ask the agent how they collaborate with their buyers for searches. Finally, ask if they’re a phone, text or email kind of person. Identify an agent who works well with your own communication style.

article courtesy of: http://www.zillow.com/blog/questions-buyers-agent-173819/

Renting or Buying a Home: Which Is Best for You?

STORY / BY ZILLOW TEAM 

The most common question people have about their living situation is whether it’s better to rent or own a home. The answers they get are typically either too generalized mathematically, or cover lifestyle issues while leaving out economic factors. Here are two ways to answer the rent versus buy question.

Step 1: By the numbers

The first method is to understand the basic math of how to compare renting versus buying. There are four components to this step:

1. Calculate the monthly cost of homeownership.
2. Calculate the tax benefits of homeownership.
3. Subtract the tax benefits from the cost of ownership to get the “after tax cost.”
4. Compare the after tax cost to market rent for a comparable property.

Using this approach, let’s calculate the monthly cost of buying a home in Seattle, where the housing market is very hot and the median home price across the region is $478,500.

Suppose you’re buying a home of this price with 20 percent down and a top-tier credit score of 780, with a 30-year fixed mortgage rate of 3.625 percent (remember, rates change daily). A quick run through the mortgage calculator shows that this mortgage payment is $1,746, property taxes are $479, and homeowner’s insurance is $67, for a total monthly housing cost of $2,292.

The federal tax deductions homeowners get for mortgage interest and property taxes save $490 per month in taxes. (To calculate estimated tax savings, multiply loan amount by interest rate and multiply purchase price by property tax rate estimate of 1.2 percent. Add these two numbers, and multiply the result by an income tax rate estimate of 30 percent, then divide by 12 to get a monthly figure. Always consult your tax adviser on any tax-related matters for a precise calculation specific to your situation.)

Subtract the monthly tax savings from total monthly housing cost of $2,292 to get an after-tax housing cost of $1,802. If we compare this to the Seattle median rent of $1,791, we can see that renting is $11 per month cheaper than buying — very close, even in a hot market.

If you do these calculations in other areas such as the Dallas-Fort Worth metro, where home prices are lower and rents are higher (relative to ownership costs), the math will more clearly support buying over renting. In some markets, buying can be cheaper than renting even before incorporating homeowner tax benefits.

Doing these rent-versus-buy calculations for your own market only takes a few minutes. Just look up home prices and rents in your area to get started.

Step 2: Time will tell

The second method for deciding if it’s better to rent or own is to understand how long it takes for buying to become more financially advantageous than renting. The point at which this happens is called the breakeven horizon.

This is a calculation Zillow created to analyze rent-versus-buy decisions at the household level. It incorporates all possible buying costs and benefits such as down payment, closing costs, mortgage payment, property taxes, insurance, utilities, maintenance, and tax benefits, as well as all renting costs for the same home. Calculations also incorporate home value and rental price appreciation.

Breakeven horizon is the year when buying costs become less than or equal to renting costs when accounting for all of the factors noted above.

For our Seattle sample area, the average breakeven horizon is 1.9 years, which (only coincidentally) is the same as the national breakeven horizon right now — meaning buying becomes more financially advantageous than renting after 1.9 years. The latest full list of breakeven horizons for major cities shows how various areas perform on this rent-versus-buy method.

The sample Seattle market calculations above show it costs about the same ($11 difference) to buy or rent right now if you account for tax benefits, and it costs more to buy than rent if you don’t account for tax benefits. If you then consider that buying becomes more financially advantageous than renting 1.9 years after your purchase, these two methods combined make a good case for buying.

Once you’ve analyzed both of these rent-versus-buy methods for your target area, you’ll have a strong command of which option makes the most financial sense. Then the rest of your rent-versus-buy decision is about lifestyle choices like whether of not you want mobility, maintenance responsibility, or freedom to upgrade your living space.


article courtesy of: http://www.zillow.com/blog/renting-or-buying-which-is-best-173925/

4 Reasons to Buy a Home This Spring

STORY / BY VERA GIBBONS

The home buying season is about to get under way, and it’s expected to be a busy one. Here are four factors that are likely to influence buyers.

Low mortgage rates

Everyone knows that the low-rate party is coming to end. Zillow is forecasting that mortgage rates – currently around 4 percent for the 30-year fixed – will rise to 5 percent by the end of 2015.

Granted, a 1-percent rise may not sound like much, but it’s a great motivator to get in and buy now. After all, a 1-percent increase in rates reduces affordability by a whopping 11 percent.

Confidence

Zillow’s Housing Confidence Index (ZHCI), which is designed to offer insights into homeowners’ and renters’ intentions and attitudes concerning the housing market, is a forward-looking gauge of housing market health. And things are looking up.

Confidence in the housing market is higher this year than it was last year — among homeowners as well as renters, many of whom are now rethinking their attitudes toward home ownership and are ultimately becoming more interested in buying.

High rents

Rental affordability is as bad as it’s ever been across the U.S., in part because there are not enough new, affordable units to meet demand. Renters can expect to spend 30.1 percent of their income on rent, while home buyers can expect to spend about 15.3 percent of their monthly income on a mortgage payment.

Those numbers alone are driving renters who can save for a down payment to pursue homeownership. In fact, data from Zillow shows that 5.2 million renters want to buy in the next year. That’s up from 4.2 million renters from the same time last year — almost a 25-percent boost.

Loan availability

Getting a mortgage is significantly easier than it was a year ago, and the markets are rapidly approaching pre-crisis credit conditions.

What this means to borrowers: Those who last year may have only been eligible for an FHA loan are now being offered conventional loans with private mortgage insurance. As lenders open their doors wider, borrowers have more options, with competitive terms and rates.

article courtesy of: http://www.zillow.com/blog/reasons-to-buy-home-this-spring-174183/

First-Time Home Buyer's Guide to Choosing a Neighborhood

STORY / BY PROFESSORBARON.COM

When you’re ready to buy your first home, you’ll probably remember those three important words we always hear about real estate: location, location, location.

While the geographic location is important, it’s also the amenities around the location that make a house a home. Every buyer is different in what they desire, so you need to find a neighborhood with the location and amenities that fit your desires — and, just as importantly, your budget.

Affordability

Location is one factor that will heavily influence the price of a property. You don’t want to shop in locations you can’t afford — even though it might be fun.

The first task in your home purchase process is getting pre-approved by a bank or mortgage lender so you understand the ballpark within which you will be playing ball. Inform your real estate agent about your price range so they can identify the locations where you can afford to purchase.

Neighborhood type

You also need to figure out what works for you when it comes to the type of location you like: urban, suburban, or rural. Many people live in and love high-density areas where retail, restaurants, gyms, and grocery stores are all within a few blocks’ walk. It’s nice to be able to walk to everything — but with that comes lots of cars, people and sometimes noisy neighbors.

Other home buyers prefer quieter suburban developments that are probably going to require driving for one’s commercial and entertainment needs.

Then there are rural folks who want full quiet and no nearby neighbors. Make sure before you shop that you are shopping in the right type of area for you.

School district

Schools also make a big difference for many buyers, and a buyer will certainly pay for the best school district. School quality is one of the top items on a parent’s mind when looking for property. You can search the Internet for school ratings and check with the city or county for more information.

Of course, if you don’t have children, it’s not as big a deal.

What’s next door — or could be

You should also always consider what is next door to the property you buy. Will you be living among lots of single-family houses, or big apartment buildings?

It’s also important to know if there are currently or once were gas stations or chemical plants nearby. Drive around and look, plus check Natural Hazard Reports to see what is or was in the area.

Additionally, be cautious about empty developable lots or empty retail/warehouse properties nearby, as you never know what might end up being built there.

It’s also smart to understand the zoning on your property, as it might let the single family home next door be torn down and developed into a 4-plex rental property. That might or might not be okay with you, but you should be aware if it’s a possibility.

Holdability

One more important item to consider regarding location is your chances of owning the property a long time. If you are not sure you’ll  be happy staying a while, you’re better off passing on buying for the time being.

Considering all these issues — as opposed to making a quick purchase decision based on what your heart is telling you — should help you buy a home that is a good fit, will serve you well, and will be a good investment for your future.


article courtesy of: http://www.zillow.com/blog/first-time-home-buyers-neighborhood-173832/

Advice for Buyers and Sellers in a Buyers’ Market

STORY / BY BRENDON DESIMONE 

When there is an abundance of homes for sale in a particular market, buyers and sellers both need to adapt their strategies. Here’s how to proceed from either side of the transaction in a buyers’ market.

How to sell in a buyers’ market

It’s not impossible to sell a home in a buyers’ market. For the right price and the right house in the right condition, there will always be a buyer. But the home’s true value may not be in line with the seller’s expectations. Most sellers refuse to believe the reality of a buyers’ market, and a struggle ensues.

If you need to sell your home in a buyers’ market, you must put your best foot forward from the start. Only the most serious of sellers should list their homes for sale in a down market.

Why? If you don’t need to move, but would just like to, then you aren’t a motivated seller. This means you probably won’t be pricing your home in line with recent comparable sales. It is likely to sit on the market for a long time, creating a big stain on your home and your listing. When it does come time to get serious, buyers will discount you.

Be a seller, not a lister

The better option is to stay in the home as long as you can, and wait to list it until you are really ready and motivated to sell it. At that point, it’s imperative that you price the home correctly from the start. Also, make the necessary cosmetic improvements: clean, clear and declutter to get the home in its best possible condition.

Following this path will ensure your home sells in a timely manner. And you will ultimately net more, having held out, than if you listed the home and had a series of price reductions over a one-year period. Of course, many sellers want to list and see what happens. But living in your home while it’s on the market gets tiring. It will never show well after those first few weeks, and many sellers give up trying to present their home well. The better option is to wait it out until the market turns around.

How to buy a home in a buyers’ market

Being a buyer in a buyers’ market is a rare treat. You have the pick of the litter, lots of options and time on your side. But it does come with risks.

There are few buyers and lots of inventory for a reason. Perhaps the economy is down, credit is hard to get, or your local market is slow (and it could get worse). It’s hard to time the market, but often maverick buyers do fine in the long run.

When you first get into the market, do your research. Understand pricing across the different towns, neighborhoods, and school districts. Buying in a buyers’ market just might afford you the opportunity to get into the best area. Once you’re in, you’re in. It may not be possible to get into the best area six months or a year later.

Once you’ve identified the location or locations you prefer, hit the ground running. Check out the existing inventory. In a buyers’ market, there tend to be many homes for sale, and they may sit on the market for six months to a year.

Know upfront that not all sellers are created equal. Some simply list their homes for sale but are not serious, motivated sellers. Don’t waste your time on them. If you find a seller who’s just not that into your offer, make your best and final offer, and move on.

Identify the motivated sellers

If you are a true bargain hunter and value is more important than the home’s floor plan, location or lot size, identify the most motivated seller. Often this is the person whose listing has been sitting around forever. Work with your real estate agent, find out why the seller is selling and what their motivation is.

The seller’s agent can be a great source of information. When you find a motivated seller, make a low offer but make it clean. Complete your inspections quickly, get fully approved for a loan, and make the timeframes fast. A foolproof offer, even if low, will motivate a seller to bite the bullet and move on.

Look for the value add

Markets will turn around eventually. Buying in a slow market all but ensures you some equity once things take a turn. And that is a great feeling.

But take it one step further. Identify a home in a down market that needs some work, and you have an additional layer of value add or equity. While you don’t need to find a total fixer-upper, be open to a kitchen or bathroom renovation. These renovations will add value, and you can make the home yours, instead of buying someone else’s choices.


article courtesy of: http://www.zillow.com/blog/buyers-sellers-in-buyers-market-174293/