Author: Igor Nastaskin
Is a Home Warranty Worth the Money?
Home warranties have become popular among homebuyers and homeowners who are seeking to prevent themselves from having to shell out cash for hefty home and appliance repairs down the road. Ultimately, home warranties can help sell a house faster and for a higher price because they offer the buyer protection against the unknown. But are they worth the money? Here, U.S. News & World Report explains what a home warranty is and tells you everything you need to know about these policies. What is a home warranty? A home-warranty company will issue a policy to a homeowner for a set premium ranging from $350 to $500 or more per year. In this policy, the company agrees to repair or replace certain appliances and major home systems if or when those appliances or systems break down. If a breakdown occurs, the homeowner files a claim online or by phone. Then the company sends a contracted service provider, or has the homeowner call a professional on his or her own time. The homeowner pays a service fee — typically $50 to $100 for each repair. The service provider may fix the problem on the spot or may need to order parts and OK the repairs with the warranty company. Depending on the policy, the homeowner may pay for the entire repair up front, and then get reimbursed by the warranty company for the portion covered by the policy. Should I purchase a home warranty? When buying a newly constructed home, you probably don’t need a home warranty. Many states require the builder to repair defects in materials and workmanship for a few years — typically two to 10 years. And the new appliances in those homes almost are always protected by one-year warranties. Existing houses, however, may have considerable wear and tear, and tend to be equipped with older appliances. A home warranty makes sense if the house is filled with outdated systems that may require repair instead of replacement. However, homeowners who think they’ll be able to upgrade appliances to newer and better models with coverage from a home warranty will be disappointed to learn that’s outside their policy’s reach. What does a home warranty cover? A typical home-warranty company offers more than one tier of coverage, depending upon price. A basic home warranty will cover a very specific list of appliances and systems, such as as the plumbing and electrical systems, heating and duct work, water heater, refrigerator, dishwasher, range or oven, built-in microwave, trash compactor and garbage disposal. Some packages also cover the doorbell, burglar or fire alarm, ceiling fans, exhaust fans, central vacuum, washer, dryer and garage door openers. An upgrade on your coverage, costing an additional $100 to $300, might include exterior pools and spas, septic tank pumps, sprinkler systems and well pumps. What doesn’t a home warranty cover? A home warranty probably won’t cover anything that isn’t specified in your contract. And it may not pay for some of the covered items if certain conditions are not met. For example, many home warranties will not cover repairs that existed before the policy, and most have a 30-day waiting period. If you buy a house and something goes wrong with an appliance in the first 30 days, the warranty probably won’t cover it. A home warranty also might not provide coverage if an appliance was incorrectly installed or poorly maintained, or if it has been worked on before. In addition, the entire cost of an expensive repair may not be covered. Many policies have an annual limit — $1,500 to $2,500 per year, for example — and might have a deductible. How do I find a reputable home-warranty company? Search “home-warranty reviews” online. In the results, look for the review sites that don’t appear to sell advertising or leads to the companies they’re reviewing. Read through the reviews and pay special attention to the bad reviews (some warranty companies load some sites with false “good” reviews). You’ll find that home-warranty companies vary in quality. If you work with the wrong company, it may drag its feet when you need a repair. If your home is without hot water, air conditioning, heat or electrical power, delaying repairs may force you to handle the problem yourself. Be sure the home-warranty company you choose actually is a company, not a local affiliate or lead-generation site. Search the company name online and make sure it has a real address, and note the contact information you’ll need if you have a problem. Before you sign anything, ask whether you have to call the home-warranty company to request a repair for it to be covered. If so, does the company have around-the-clock phone service? Find out who will be providing repair services in your area. Large national companies are more likely to have an extensive list of service providers. Then check out the local service providers on online review sites to make sure they’re reputable. Ask a lot of questions before you sign up, and confirm all of the answers you receive in writing. Everything should be detailed in the contract. Watch out for contract wording like “at our sole discretion” or “we reserve the right.” These can be the first steps toward denying claims. How do I file a claim? If you file a claim, get the name and contact information of the service person that visits your home. Try to stay in the middle of the process so the warranty company can’t claim delays are caused by the contractor’s failure to send paperwork. Make copies of everything you receive and send them yourself via e-mail, if necessary. If you run into delays, tell the claims representative that you will be filing complaints with the Better Business Bureau and online review sites unless your case is passed to the “escalations team” or other supervisors. Be sure to get everyone’s name, direct phone number and e-mail address.
Why it’s Smart to Pay Attention to the Starbucks Principle
Looking for a home in an area that will have long-term value and appreciation? Go get a coffee at a Starbucks in your desired area and experience what’s become known as the “Starbucks Principle” — an easy way to help you judge the potential long-term value and desirability of the area you are considering. Basically, if you see a new Starbucks being built — or a large expansion/remodel of an existing Starbucks — then that likely will be a good area in which to buy a home. What does a coffee shop have to do with your home value? Here, an explanation from RISMedia: • Franchises such as Starbucks dedicate vast resources to gathering information on demographics, population growth, disposable incomes and development. Before a company this size dedicates massive resources and capital, they make sure they know everything they can about the surrounding population, businesses and long-term potential for growth. • Beyond their own in-company resources, Starbucks also has large numbers of developers and commercial real estate brokers seeking out their business. To get the company to buy or lease in a given location, there must be a strong amount of data to support the sales and growth potential of the area. The company uses all of those resources to make sure it places stores in valuable locales. • Starbucks definitely will make sure that the data for disposable income, population projections, business growth and other factors support a new or expanded store; but the addition of a store to an area can actually create growth around it as well. When other businesses see Starbucks adding a store, they notice and frequently will flock to the area as well, which, in turn, brings people to retail centers.
Half of US Homebuyers Are Millennials
Almost half of US homebuyers are under the age of 36, according to a new survey by the online real estate firm Zillow. The study—The Zillow Group Report on Consumer Housing Trends—surveyed more than 13,000 homeowners, sellers, buyers and renters nationwide between ages 18 and 75. The results found that 47 percent of homebuyers are millennials and 63 percent of people are selling real estate for the first time. Here, some other significant finding from the study: • Half (50 percent) of today’s homebuyers are under the age of 36 and 47 percent are first-time buyers. Solo homebuyers are in the minority; most buyers are shopping with a spouse or partner (73 percent). • Eighty-three percent of buyers are shopping for a single-family house. Their top considerations are affordability and being in a safe neighborhood. • Fifty-two percent of buyers consider renting while they’re shopping for a home—a number that’s even higher among younger buyers. • Seventy-five percent of buyers hire a real estate agent during the buying process. • Across all generations, almost nine out of 10 buyers (87 percent) use an online resource at some point in their search for a home to buy. • Millennial homebuyers share many concerns and preferences with their grandparents’ generation, both choosing homes with shared community amenities and considering townhouses at higher rates than those ages 35-49. However, Millennials’ home-buying process is significantly different from their grandparents’ process. • Millennial homebuyers wait longer to buy a first home than previous generations. The modern-day “starter home” is nearly as large as the median home for “move-up” buyers, and costs about 18 percent less. • Millennial homebuyers undertake far more social home searches, seeking input from friends, relatives and neighbors 58 percent of the time, versus the Silent Generation, who poll friends just 37 percent of the time. • More than a quarter (26 percent) of buyers find an agent online. A third (33 percent) find an agent through a personal referral. • Millennials scrutinize more agents, asking friends and family about their experiences with agents and reading online reviews more than other generations. • When it comes to choosing an agent, Millennials and other generations share their top priority: a sense that an agent is trustworthy and responsive to their needs. • The average shopper goes on seven home tours, and while they may incorporate online research, they tend to be hands-on at decision time, preferring to meet an agent in person or talk on the phone, and prioritizing private tours of homes led by a professional. • Only 46 percent of buyers get the first home on which they make an offer, reflecting the reality that in today’s tight market, the search—which takes an average of 4.2 months—comes with competition and disappointment. • More than half of buyers (56 percent) save up for a down payment by setting aside a little money at a time. Almost a third (32 percent) use more than one source for their down payment, including gifts and loans from family, selling stocks and bonds, and cashing in retirement savings.
How to Sell a Luxury Property
Getting ready to place a high-end home up for sale? You’ll probably find that the process is a little different than it is when selling a more moderate property. For one, the new owner usually will want to tailor the property to suit his or her preferences. Here, five tips from RISMedia that can help you get the best price for your luxury property. 1) Don’t remodel or repair before selling Remodeling and repair work typically will be wasted on a luxury property. Although essential repairs such as putting on a new roof usually are recommended on a lower-end property, a luxury property most likely will be entirely remodeled by its new owner. This might even include adding onto or tearing down parts of the existing structure. Unless the repairs are necessary for the protection of the property or structures—such as fixing a leaky roof—you’re usually better off selling a luxury property as is. 2) Hire a professional stager Most real estate agents remove knickknacks and clear away excess furniture before trying to sell a property. However, it’s even more important to hire a professional staging company to showcase a luxury property without a lot of distractions. Most luxury buyers will remodel anyway, so they are looking at a home’s potential rather than its current state. 3) Advertise discreetly The affluent often will pay top dollar for their privacy. Loudly proclaiming a luxury property for sale not only is likely to attract the wrong parties, but it also might make the property a prime target for thieves and vandals. 4) Hire a real estate agent who specializes in luxury properties There are agents who specialize in selling luxury properties, and therefore, have both the specialized knowledge and resources to help you obtain the best price. Market trends for high-end properties can differ from current market trends for lower-end properties. Find an agent who understands the current market conditions for your specific type of property and can advise you on the best course of action. 5) Understand the true value of the property and market accordingly It’s important to understand where the real value in your property lies. If you have an older property on a valuable parcel of land, then the structure itself probably has little value and likely will be torn down. Be sure you’re emotionally OK with that before choosing to sell.
Market Share of 5,000-Plus-Square-Foot Homes on the Rise
New homes with 5,000 square feet or more of living space increased both as a share of all new construction and in absolute number in 2015, according to the Census Bureau’s Survey of Construction. In 2015, the share of new homes this size reached a post-recession peak of 3.9 percent of new homes started. The total number of 5,000-plus-square-foot homes started that year was 28,000 units. In 2012, the number of new homes started with 5,000-plus square feet rose to 15,000 units, yet their share remained at only 2.8 percent. In 2015, while the number of 5,000-plus-square-foot homes started (28,000) was the highest since 2008, their share of the new market (3.9 percent) was the highest since 2004. In the boom year of 2006, 3.0 percent (or 45,000) new homes started were 5,000 square feet or larger. In 2007, the share of new homes this size was 3.6 percent, yet the total number of 5,000-plus-square-foot homes started that year fell to 37,000. In 2008, only 20,000 such homes were started, or 3.2 percent of the total. From 2009 to 2011, fewer than 13,000 of these large homes were started every year, accounting for less than 3 percent of all new construction during this period. The extent to which the 5,000-plus-square-foot homes have recovered—roughly to where they were in 2008—shows a growing trend at the top of the market at least through 2015. When analyzed by the different characteristics, 79 percent of 5,000-plus-square-foot homes started have a finished basement; 68 percent have a three or more car garage; and at least 60 percent have a patio or porch. More than half of the homes have five or more bedrooms, while 70 percent have four or more bathrooms.
Hollywood Riviera’s Celebrity — Rosemary DeCamp
One of the most famous residents of the Hollywood Riviera is, no doubt, actress Rosemary DeCamp who lived here for almost 60 years, until her death in 2001. Rosemary and her husband, Judge John Shidler, purchased a Hollywood Riviera house on Camino de las Colinas in 1945 (when there were only three houses on the block) for the price of $22,500. Here they raised their four daughters: Margaret, Martha, Valerie and Nita. Rosemary was a well-respected actress who, while very pretty, often played matronly roles such as being the mother in Yankee Doodle Dandy and Jungle Book. Later she was also involved in television, including The Bob Cummings Show, Life of Riley and others. While she was not the typical flamboyant Hollywood type, Rosemary was known to drive around in her beloved white Rolls Royce Silver Cloud nicknamed Snowball. Mid career Rosemary married a local boy, John Ashton Shidler, a Stanford Law School grad who later became a Torrance Superior Court Judge. After marrying, the newlyweds lived in Beverly Hills where John might have gotten tired of being called Mr. DeCamp a few too many times. John wanted “down-home living” for his family. The Shidler family was active in the community. Rosemary was also an artist and supported community cultural groups. She conducted a playwriting contest at Torrance High School for many years. Judge Shidler was a prominent community member who also served on the Torrance School Board and was instrumental in helping protect Torrance Beach from high rise developments. Rosemary died here at age 90. John predeceased her death by a few years (in 1997). The couple was among the longest lived Riviera residents. The “down-home living” of Hollywood Riviera suited Rosemary and their daughters well. The girls said they never saw their parents fight and they had a wonderful life growing up here. While well aware that their mother was a celebrity, none of them ever let fame go to their heads. With community support, the Friends of the Hollywood Riviera plan for this identifying marker to be placed at the corner of Via Monte d’Oro and Palos Verdes Blvd., which was the original entrance to our beautiful historic neighborhood in 1928. The marker will be 14 feet long and 5 feet high and is designed in the Mission style with period font. The back of the marker will be inset with custom period tile detailing a brief history of the Hollywood Riviera. To see maps and photos, go to the Riviera Homeowners Association website and click on Hollywood Riviera Marker Project: hollywoodriviera.org/marker. Now you have the opportunity to support this exciting project. You may contribute via GoFundMe or by check to: Friends of the Hollywood Riviera, c/o Dina Wiley, 202 Via la Soledad, Redondo Beach, CA 90277. Thank you to Edie Dees, Dina Wiley, Karen Lent and Janet Hart for the above stories. DeCamp-Shidler House on Camino de las Colinas Much of the information in this article is from Rosemary’s autobiography: “Tiger in My Lap.” The DeCamp-Shidler daughters still live in Southern California. Three local history buffs, Edie Dees, Dina Wiley and Karen Lent spent time talking with Rosemary’s oldest daughter, Margaret. They have been collecting information for a book they are writing on the Hollywood Riviera’s history. Please contact one of them should you have historical information or photos. Old Hollywood Riviera Research Group/September 2016
Consumers Show Increased Caution in Home Purchase Sentiment in September
Fannie Mae’s Home Purchase Sentiment Index (HPSI) decreased 2.2 points to 82.8 in September, moving further off of survey highs. Consumer caution surfaced in the September HPSI, with four of the six components decreasing during the month. The largest decrease was seen in the net share of consumers who expect mortgage interest rates to decrease during the next 12 months, which fell 6 percent. This was followed by a 5 percent drop in the net share of consumers who say now is a good time to buy a home and a 3 percent drop in the net share of consumers reporting confidence about not losing their job during the next year. Household Income was the only HPSI component to increase in September, with slightly more consumers than the previous month reporting that their household income is significantly higher than it was 12 months ago. “The decline in the HPSI over the past two months from the survey high in July of 86.5 adds a note of caution to our moderately positive housing outlook,” says Doug Duncan, Fannie Mae’s senior vice president and chief economist. “Downside changes came in particular from the HPSI components mortgage rate direction and good time to buy a house. In addition, the starter home tight supply and rising home prices, as well as the unsettled political environment, are likely giving many consumers a reason to pause or question their home purchase sentiment.” Here are the survey highlights: • Fannie Mae’s September 2016 HPSI decreased 2.2 percent in September to 82.8. Overall, the HPSI is down 1.0 point since the same time last year. • Breaking from the increasing trend of the past few months, the net share of Americans who say it is a good time to buy a house fell by 5 percent to 29 percent to match a previous all-time low reached in May. • The net percentage of those who say it is a good time to sell a house remained at 15 percent in September. • The net share of Americans who say that home prices will increase fell 1 percent from August to 34 percent. • The net share of those who say mortgage rates will decrease during the next 12 months fell 6 percent to negative 44 percent. • The net share of Americans who say they are not concerned with losing their job fell 3 percent to 70 percent. • The net share of Americans who say their household income is significantly higher than it was 12 months ago rose 2 percent to 12 percent.
Five Tips for Dog Owners Looking to Buy a Home in L.A.
Dogs are part of the family. So, when buying a home in a new neighborhood, you’ll definitely want to take your pet’s needs into consideration. Is the neighborhood safe? Are parks, pet stores and veterinary care easily accessible? You’d also be wise to know the area’s pet regulations and ordinances. To help you find the ideal home for you and your pup, U.S News & World Report gleaned advice from some of L.A.’s top real estate agents as identified by the real estate data company OpenHouse Realty. Here’s what they had to say. Big dogs belong by the beach Although there are no regulations mandating where owners of certain dogs may live, people who own big dogs generally like to live by the beach. Some recommendations include Long Beach for its access to Leo Carrillo State Park, as well as Redondo Beach for its pup-friendly shoreline. Dog parks are a great way to meet your neighbors Finding a neighborhood with a dog park not only is important for your pet’s health, but it also is a terrific way to connect with your neighbors. Among the most popular: Silver Lake Dog Park, next to the reservoir, with shade canopies and a separate section for smaller pooches, and Santa Monica Airport Park, a 4-acre park with an off-leash dog area and walking loop, along with Westminster Off-Leash Park in Venice and and Playa Vista Dog Park. Ask about homeowner association policies L.A. doesn’t have a uniform ordinance for homeowner associations, but most HOAs have some rules regarding pets. Many HOAs won’t allow dogs that weigh more than 50 pounds, and some will even limit you to a 35-pound dog. They also might limit you to just one pet, depending on the size and availability of outdoor facilities. Your HOA also might have specific areas where your dogs can roam free or must be on a leash. Review city ordinances L.A. County has its own rules and ordinances regarding pets. For example, all homeowners are limited to a total of three dogs in their residences. Dogs are required to be on a leash whenever they are off of your private property, unless they have a license. Regulations also require dog owners to carry bags for cleaning all dog waste off public streets. For details, visit the L.A. County Department of Animal Care and Control website at http://animalcare.lacounty.gov/wps/portal/acc. Do what it takes to keep your dog happy and healthy No matter which neighborhood you decide on for you and your pet, be sure to keep your animal safe from the elements. Provide plenty of shade and water if you plan on keeping your pet outdoors during the daytime. If you have a yard, consider installing fencing to help keep your animals from getting out and other animals (such as coyotes and mountain lions) from getting in. Additionally, the city of L.A. requires all dog owners to tag and license their pets, which helps shelters identify animals if they are lost. Before tagging, dogs must be spayed or neutered and receive a rabies vaccination. Owners pay a fee for a one- or three-year tag license, and dogs must wear their tags whenever they are off the owner’s property.