Author: Igor Nastaskin
5 Ways to Put More Money in Your Pocket on Closing Day
The busy spring home-buying season is getting underway. And with slower price growth and lower mortgage rates, that means sellers will need to be more strategic about how they price, market and negotiate their home sale if they want to get the right buyer through the door. Here, Bankrate offers five listing strategies sellers can implement to ensure they sell their home quickly and for top dollar. 1. Time your sale right You have a competitive home price and great listing photos, but another strategy that shouldn’t be ignored is the date you list your home for sale. Research shows that sellers typically get the highest prices and sell their homes more quickly when they list during the first week of April, according to Realtor.com. Homes listed in that week logged an average of 14 more views on Realtor.com and have 5 percent less competition from other sellers. Even more enticing for sellers: Homes listed the first week of April see 6 percent higher prices—a gain of $17,000 more for a typical home. One big reason why? Available housing inventory typically reaches its highest levels in May, so listing in early April when there aren’t as many homes on the market means you [as a seller] could capture buyers who won’t have the ability to compare your house with one on the next block. You don’t have to compete as much to stand out with the best upgrades and a lower price. 2. Price competitively from the start When casting a wide net for potential buyers, it’s critical to price a home right from the get-go. Some sellers can let their emotions dictate their selling price rather than relying on their real estate agent’s expert opinion and market data, and that’s a big mistake. If you list too high, you could end up selling your home for less, and it will take longer. Overpricing a home can lead to multiple price cuts, which adds time to the transaction and the loss of interest in your listing. Your listing agent will run a comparative analysis of homes that are for sale and have sold in your neighborhood in recent months to help gauge your property’s market value. It’s always better to list a little lower than to overprice to attract a wider range of buyers. 3. Don’t wait until the home inspection to make repairs If you know about any major issues that will get flagged by a home inspection, it’s a good idea to fix them before you list your home for sale. Otherwise, you risk turning off some buyers. You’ll also add unnecessary time to late-stage negotiations that can delay your closing. While buyers plan and budget for their down payment and closing costs, and maybe have some reserves, it’s probably not enough to replace an HVAC system and other big items. Unless you’re selling a true fixer-upper home and marketing to investors who fix-and-flip homes, don’t assume selling your home “as-is” will attract many buyers. 4. Set the stage Your real estate agent will likely tell you to declutter your home before taking listing photos and holding showings. Some home experts recommend sellers take it a step further and hire a professional home stager—especially for high-end homes that can take longer to sell and have a more limited buyer pool. Nationally, professional home staging costs an average of $922, according to HomeAdvisor. Homeowners pay between $325 on the low end up to $1,518 on average, HomeAdvisor found. Don’t want to shell out the cash for a stager? You can still do inexpensive things to spruce up your home. A fresh coat of white or off-white interior paint makes a big impact and isn’t expensive, and a professional window cleaning is also another inexpensive way to make a good first impression. 5. Vet buyers’ offers closely If you receive multiple offers for your home, and one or two that are way over asking price, zero in on a buyer’s preapproval letter and offer. Try to understand why they’re willing to pay a steep premium. Do they plan on making a small down payment? Do they have to sell their home first to buy yours? Have they put in multiple contact contingencies or requests for seller credits or an extension to close? Too many conditions in an offer may lead to a more difficult negotiation process—and it could take longer to get to the closing table. There’s also a risk that your home may not appraise for a too-high offer price. Your agent can help you make an informed decision as you sift through offers. Ultimately, your goal is to net a sales price that meets your financial needs while getting to the closing table with as little difficulty as possible.
How to Avoid Some Major Home-Buying Pitfalls
Want to avoid potential mishaps and home-buying Pitfalls? Heed this advice from realtor.com that’s based on the experiences of people who’ve gone through the process many times. Here, some tips on how to avoid the mistakes homebuyers make again and again. 1. Know your true priorities Before you begin your home search, isolate your top criteria—whether that’s a certain number of bedrooms, proximity to work or school or a fireplace—so you won’t be easily sidetracked. Creating a list of top features or amenities increases efficiency. 2. Have plenty of patience Purchasing a home is a huge investment, so don’t rush into it. It may take some time to find the right property, but your patience could be rewarded with a great find. For instance, if you’re having trouble finding the right home, you might consider looking at a distressed property that will need some work. By arranging for contractor estimates before submitting an offer, you could possibly get a great deal on an overlooked property that requires mostly cosmetic work. 3. Don’t go house-blind Consider the advice of your Realtor, lender and others who’ve done this many times before. Say, for example, you ignore your agent’s warnings about the expense and complication of purchasing an old farmhouse for your first home and move forward with the offer. If an inspection uncovers many problems and repairs that are needed, you could end up backing out of the deal. While you will be able to recover your escrow funds, you can’t get back the thousands of dollars spent on the inspection, appraisal and other due-diligence tasks. 4. Don’t think of your loan approval amount as your budget During the pre-approval process, your mortgage lender will let you know the loan amount you qualify for based on your credit score and other financial information. Often, this number translates into a monthly payment that is higher than what you can actually afford, along with all of your other monthly expenses. Just because you qualify for a certain mortgage price doesn’t mean you should buy a home for that price. Purchasing a home with a payment that is too big for your monthly budget can leave you house poor, stressed and unable to afford maintenance. Instead, ask the lender to work backward to find what the budget can afford. This way, you can know the home fits in your budget, and you can find a home you can comfortably afford. 5. Don’t make a big purchase just before closing Even if you’ve gone through the pre-approval process with a lender, your mortgage isn’t final until you’ve closed on the house. Don’t jeopardize your ability to get the mortgage by making large purchases or doing other things that can affect your credit score or borrowing ability. A common mistake is that once a buyer is pre-qualified and has had an offer accepted by a seller, he or she will go out and purchase a car, apply for additional lines of credit, accrue more debt, miss payments or pay late on current obligations. Doing these things potentially could affect your credit score in a negative way, resulting in you not receiving final approval from your lender.
5 Factors That Can Influence a Home’s Asking Price
Never dismiss a house for being too expensive until you know the variety of reasons a home’s asking price is the way it is. In fact, understanding the reasoning behind a home’s price tag can make you a smarter buyer—and help you know exactly what you’re getting for your money. Here, realtor.com discusses five factors that experienced real estate agents consider before placing a for-sale sign on a home. 1. What’s happening in your local housing market at any moment Current real estate market conditions—including how many houses are for sale, and how fast they’re being purchased—determine how a property should be priced. Low inventory creates a seller’s market with aggressive listing prices, while a surplus of homes for sale results in overall lower asking prices. But all of that can quickly change. That’s why you should work with an experienced real estate agent who’s familiar with the neighborhood you’re shopping in and can assess whether a home is priced fairly—or not. 2. The (extremely specific) location of the house The idea of “location” is very granular. It’s not just about being in a good neighborhood; similar or even identical houses just streets apart from each other can have vastly different price tags based on factors such as traffic noise and access to quality schools, shops and restaurants. The asking price also hinges on what else is on the block (like a tear-down next door); how old the buildings are to your right and left; and whether there is a nearby park. A quiet cul-de-sac or a busy thoroughfare also will affect the prices of homes on them, along with the direction the home faces. And in most areas, properties with easy access to highways bring in more money. 3. The local comps! Sellers often have a figure in mind of what their home is worth. But real estate pros will do a comparable market analysis—what similar homes have recently sold for—before determining how to price a property. Historic data plays a large role in setting a listing price, so be sure to find an agent who can interpret that data. 4. The amenities and appeal of the home Today’s demanding buyers are concerned not only with square footage, but whether a home is a new construction, has brand-name appliances and large bedrooms, plus a den or office. Natural light and high ceilings also play a major role in the value of a house. Additional features such as parking, central air conditioning, outdoor space, and floor plan also affect the price. 5. Age and condition of the home If you decide to fix up a poorly maintained property, you likely won’t automatically see a deeply discounted price tag. It all depends on the home’s location and other factors. Chances are good, however, that it won’t cost as much as a recently revamped home in the same neighborhood. If you want a newer, turnkey home, expect to pay more for that. Note: Even if a seller has completed multiple upgrades, quality trumps quantity every time. An addition to the house or serious electrical work done in an unprofessional manner will reduce the sales price
6 Things to Prepare For if You’re Selling
Spring is one of the best times to Sell a Home. Not only do buyers turn out in droves once warmer weather finally arrives, but bidding wars abound as buyers look for ways to one-up their competition. But sellers also can face challenges during this time of year. Here, realtor.com discusses six things to prepare for if you’re thinking about selling a home this spring. 1. Demand While home sales decline in the winter (mainly due to inclement weather and holiday obligations), many home buyers blitz the housing market in spring. To meet that pent-up demand, many sellers list their homes at this time of year. It’s no surprise, then, that the lion’s share of real estate agents state that March, April and May are the best months to sell a home. With so many buyers competing for homes, sellers may be in a stronger position to spark bidding wars. 2. Competition Demand is strong, but so is competition among home sellers. According to the National Association of Realtors (NAR), the four heaviest home-selling months—May, June, July and August—account for 40 percent of an average year’s total home-selling volume. Want to compete with other home sellers and fetch top dollar for your house? Presenting your home in the best light is crucial. This may include decluttering your house, having your home professionally staged or making minor repairs so that your property is looking in tip-top shape when you place it on the market. 3. Warmer weather Open houses usually are more successful during the spring than in the winter because the nicer weather makes buyers more willing to emerge from the comfort of their homes to shop for houses. Another boon for home sellers: Daylight saving time gives buyers more time to look at houses, which means your property can potentially be seen by more people. That said, sellers still need to do some prep work before holding an open house. Ensure that your home is ready to be seen by completing a thorough cleaning, removing personal belongings such as family photos and religious artwork, and trimming your lawn for maximum curb appeal. Pro tip: Take a hike for a few hours during the open house. Buyers will feel more comfortable asking questions of your agent if you’re not hovering in the background. 4. Fighting for your agent’s attention Not only is spring a busy time for home buyers and sellers, but it’s also a busy time for real estate agents. Unfortunately, some agents may take on more clients than they can handle at one time. That’s why it’s important to find a listing agent who will put the proper level of effort and time into selling your home. There’s no hard-and-fast rule for the maximum number of clients an agent should be working with, but make sure to address this topic when interviewing. If your gut says you’re not going to be a priority, continue looking. 5. Higher valuations When your home’s value is assessed by a home buyer’s appraiser, the appraiser will look at data for comparable homes (or “comps”) that were recently sold in your neighborhood. The good news: With more homes selling in the on-season, your house is more likely to pass the home appraisal, assuming that you’re selling it at around its fair market value. 6. Picky buyers Some buyers can afford to be more selective when there are more houses from which to choose. For instance, if your home clearly needs major repairs, they might simply pass. Add in the fact that most spring buyers aren’t shopping under pressure (as they might be during the winter), and you can expect to have a larger pool of picky house hunters in the spring than you do during other seasons.
5 Tax Deductions To Use When Selling a Home
While there are tax deductions you can take when selling a home, the new Tax Cuts and Jobs Act has created some confusion this filing season. But rest assured that if you sold your home last year (or are planning to in the future), the tax deductions still may amount to sizable savings when you file with the IRS. Here, realtor.com offers a rundown of all the tax deductions (as well as tax exemptions or other write-offs) at your disposal. 1. Selling costs These deductions are still allowed under the new tax law as long as they are directly tied to the sale of the home and a married couple—or a single taxpayer—lived in the home for at least two out of the five years preceding the sale. Note: The home must be a principal residence and not an investment property. Among the deductions are any costs associated with selling the home, including legal, escrow and home-staging fees, as well as advertising costs and real estate agent commissions. Just remember that you can’t deduct these costs in the same way as mortgage interest. Instead, you subtract them from the sales price of your home, which in turn positively affects your capital-gains tax. 2. Home improvements and repairs If you renovated a few rooms to make your home more marketable (and to can snag a heftier sale price), now you can deduct those upgrade costs as well. This includes painting the house or repairing the roof or water heater. But there’s a catch, and it all boils down to timing. If improvements were necessary to sell your home, you can deduct those expenses as selling costs as long as they were made within 90 days of the closing. 3. Property taxes This deduction is still allowed, but your total deductions are capped at $10,000. If you were paying your property taxes up to the point when you sold your home, you can deduct the amount you paid in property taxes this year up to $10,000. 4. Mortgage interest You are allowed to deduct the interest on your mortgage for the portion of the year you owned your home. However, the rules have changed slightly from last year. Under the new tax code, new homeowners (and home sellers) can deduct the interest on up to only $750,000 of mortgage debt, although homeowners who got their mortgage before Dec. 15, 2017, can continue deducting up to the original amount up to $1 million. Note: The mortgage interest and property taxes are itemized deductions, which means that all of your itemized deductions need to be greater than the new standard deduction that the Tax Cuts and Jobs Act nearly doubled to $12,200 for individuals, $18,350 for heads of household and $24,400 for married couples filing jointly. (For comparison, it used to be $12,700 for married couples filing jointly.) 5. What about with capital-gains tax for sellers? Home sellers can still use the capital-gains rule. Technically, however, it’s an exclusion rather than a deduction. Capital gains are your profits from selling your home—including whatever cash is left after paying off your expenses, plus any outstanding mortgage debt—and these profits are taxed as income. The good news is that you can exclude up to $250,000 of the capital gains from the sale if you’re single and $500,000 if married. Note: You must have lived in your home at least two of the past five years.
Why Do You Relay? Annual Fundraiser Touches Lives in Our Community
When Riviera resident Hope Witkowsky first participated in the Torrance Relay for Life more than 15 years ago, her goal was to support a fellow city council member whose relative died of cancer. Little did she know that in 2013, her fight against cancer would get personal. That was the year that her husband, Mike, was diagnosed with lung cancer, and only nine months later Hope was diagnosed with breast cancer. “As survivors, fighting back against cancer by getting involved with Relay For Life is even more poignant for my husband and I,” said Hope, a former Torrance councilwoman who produces and hosts the local cable show, Senior Scene. “I raise money for Relay for Life every year and I won’t stop until cancer is stopped.” In 2019, there will be an estimated 1,762,450 new cancer cases diagnosed and 606,880 cancer deaths in the United States, which translates to about 1,660 deaths per day, according to the American Cancer Society. Cancer is the second most common cause of death in the US, exceeded only by heart disease. The positive news is that in the last two decades, cancer rates declined by about 27% because of reductions in smoking, as well as improvements in early detection and treatment. This decline translates into more than 2.6 million fewer cancer deaths from 1991 to 2016, progress that has been driven by steady declines in death rates for the four most common cancer types – lung, colorectal, breast and prostate. You can help fight back against cancer by joining forces with neighbors and friends at the 17th annual Torrance Relay for Life, held April 27-28 at South High School. The world’s largest grassroots fundraising event, Relay For Life raises money for the American Cancer Society with the help of teams of volunteers who commit to having at least one team member walking on a track at all times over a 24 hour period, because cancer never sleeps. Relay for Life honors cancer survivors, pays tribute to those who have lost their lives to the disease, and raises money to fight cancer by funding research and providing support for patients and caregivers. With the help of thousands of volunteers, Relay for Life fundraisers assist the American Cancer Society in saving more than 500 lives a day. Relay for Life Torrance raised nearly $225,000 for the American Cancer Society last year. The Hollywood Riviera Sportsman’s Club continues its tradition of fielding a team at the Torrance Relay for Life, with Igor Nastaskin serving as team captain for the 13th consecutive year. Please consider joining the Riviera Sportsman’s Club’s Relay team if you’d like to get involved (women and men are welcome). The team has raised nearly $125,000 for the American Cancer Society over the past 14 years. Highlights of the Relay for Life are the opening ceremony Saturday, April 27 at 9 am followed by a survivors’ lap at 9:30 am. At 8 pm Saturday, a Luminaria Ceremony will honor survivors as well as those who lost their battle with cancer. Entertainment is provided throughout the event, which concludes Sunday at 9:00 am with a closing ceremony. To sign up for the Hollywood Riviera Sportsman’s Club team, or to donate funds to the American Cancer Society for the fundraiser, please contact Igor at 310-892-6016 or [email protected]. Donations are accepted until August 31, 2019. Your gift is tax-deductible as a charitable contribution to the fullest extent allowed by law. For more information about the American Cancer Society’s support for survivors and patients, please call them 24/7 at 1-800-227-2345 or visit cancer.org. We hope to see you at South High the weekend of April 27-28 as we pull together as a community to fight back against cancer.
How Boost Your Credit Score Before Buying a Home
Hoping to buy a home soon? You’ll want to make sure your credit score is acceptable because lenders check this number as a way to gauge whether to give you more credit in the form of a home loan. If your credit score is high, you’re considered creditworthy, which bodes well for your chances of getting a good mortgage. If your credit score is low, however, lenders might be concerned that you’ll default on your home loan and deny you a mortgage (or charge you a premium for it). Here, realtor.com offers information on how to improve your credit score fast. 1. Check for credit score errors A low credit score may not be entirely your fault. One in four Americans actually finds errors on their credit file, according to a Federal Trade Commission survey on Americans’ credit scores. Credit score errors are common because creditors make mistakes with reporting. For example, although you may have never missed a credit card payment, someone with the same name as you did miss a credit payment—and your bank recorded the error on your credit account by accident. This is why it’s important to do a free credit check and look for any errors that could be dragging down your credit score. If you find some errors, you can remove them from your credit report by contacting the credit bureaus (Equifax, Experian and TransUnion) with proof that the credit information was amiss. From there, the credit bureaus will remove these flaws from your credit report, which will later be reflected in your credit score. If it’s an identity error (like a credit card that’s not yours showing up on your credit report), this type of credit error can be fixed in one to two months. However, if it’s an error on your own credit card account, it may take longer to be reflected in your credit score since you’ll need to contact your credit card company as well as the credit bureaus. In this case, expect to wait up to three months before this mistake is purged from your credit report and reflected in your credit score. 2. Pay down your credit debts Paying down your debt is the thing you can do that could have the biggest—and fastest—impact on your credit score. Credit utilization (or the amount you can borrow in credit versus the amount of debt you’re carrying) accounts for 30 percent of your credit score. And the more available credit you have, the better. If you have the cash on hand, try to time your credit payments so you’re reaping the credit-reporting benefits. Not sure when your creditor reports? You could call them and ask, or you can check your credit report. It will take about one month to improve your credit score. 3. Get your credit bills current If you’re already late on a payment, pay it as soon as possible for a quick credit score boost. Paying credit bills on time is the most important factor in a credit score, so going from paying one or more credit bills late each month to paying all on time could show an improvement in one to two months. If you’re less than 30 days late on a credit card bill and you can make the payment today, do it. Creditors don’t typically report until after the 30-day mark. 4. Open a new credit card account Opening a new credit card account can help improve your credit score by increasing your total outstanding credit line and helping your credit mix. It will take one to six weeks to improve your credit score based on processing and reporting your new account. Note: Try opening just one new credit account, at least at first. If you apply for a card every time you’re asked whether you want 10 percent off your purchase, the amount of credit inquiries will negatively affect your credit score. 5. Become an authorized credit card user Have a responsible partner or family member who always pays their credit card bills on time? Becoming an authorized user on one of their credit card accounts will let you piggyback onto their good credit history, with the full history of the other account showing up on your credit report immediately. And when this older, established credit account is added to your credit history, it results in an increase in the average age of accounts you’ve ‘managed’ (which also increases your credit score). Just be careful to make sure the person you choose actually pays his bills on time and keeps the debts low—just like good credit history, bad history will show up, too. 6. Get a secured credit card or loan If you’re having trouble qualifying for a traditional credit card, try for a secured credit card, which is “secured” by a deposit. This means that if you default or stop paying, your deposit will be used to pay off the account. This lowers the risk involved for the lender, which makes it more likely to offer you credit even if you don’t have an established credit history. It will take one to two months to improve your credit score, and while you’re at it, make sure to keep all your credit cards open, whether you use them or not. As long as they aren’t charging you any annual fees, that is. The reason? Closing accounts might increase your credit utilization ratio, which won’t be good for your score.
How to Know When it’s Time to Sell Your Home
Most people don’t plan on living in their first (or second or maybe even third) home forever, but knowing when the time is right to put your home on the market can be difficult. Without a pressing reason such as a major life change confronting you, knowing when to sell your house can be tricky. Here, realtor.com lists 6 reasons that will help you know when it’s time to let go. 1. You’re feeling cramped Even if your family is not growing, your lifestyle still might not fit in your current house. For example, if you’ve started working from home, you’ve adopted a few pets or you have a dream of owning a hobby room, your house might be too small. Before you jump to conclusions, however, see if you can pare down your possessions to free up some space. Another option might be to finish an attic or basement, add another room or even add an entire story to your home. But, of course, that won’t work for everyone, especially if your property isn’t large enough or your municipality doesn’t allow it. In that case, moving to a bigger home may be your best option. To decide which route to take, check your local building laws and get estimates from two or three contractors. You also might want to check with your Realtor. Sometimes adding on won’t increase the value of a home, and you don’t want to make significant improvements that will bring only a small return on your investment. 2. You have too much space On the other hand, perhaps you’ve recently become an empty nester and are feeling overwhelmed by vacant rooms and silence. In this scenario, it no longer makes sense to have four bedrooms and a basement, for example. While saying goodbye to a family home can be difficult, you should consider how feasible it is to stay. If yard work and house upkeep are getting to be a little too much or soaring utility bills are cramping your style, it might make more sense to move. 3. You’re over the neighborhood Maybe you can no longer deal with the stringent rules of your homeowner’s association, or perhaps your neighbors turned their house into a rental for undesirable tenants. Whatever the reason, neighborhood dynamics can change dramatically during time. And sometimes, you can change. Maybe the 40-minute commute to work didn’t seem like such a big deal the first few years, but now you’re dreading it every day. Or your kids are getting older, which can be a big problem if you’re not in the right location to benefit their education. 4. Remodeling won’t offer a return on your investment Giving your kitchen or bathroom a face-lift can make your house feel new again, and that might be all you need to decide to stay put for years. But that doesn’t mean it’s a financially sound decision. Before making big improvements, study the area and know the highest price point of your neighborhood. If your home is already similar in style and condition of some of the priciest homes in the neighborhood, remodeling might not be a good idea and you should consider selling instead. 5. When you can afford to sell Before you consider selling, make sure you have the funds available to prepare your home for sale. Most sellers need to make some minor improvements, such as painting, landscaping or updating flooring, to get a good price on their home. Those costs will come out of your pocket at first, so it’s a good idea to have a cushion before you start. 6. You’re ready to compete If you’re living in a seller’s market, you might be enticed to offload your home before things go cool. But don’t forget—once you sell, you’ll probably be a buyer, too. If your market is hot, your home may sell quickly and for top dollar, but keep in mind the home you buy also will be more expensive. If you’re going to get out there, make sure you’re ready to compete.