5 Myths About Real Estate

Real estate is a topic that’s always in the news as well as heavily debated in many social spheres. It’s also an area that is constantly evolving which can make it difficult to determine what’s fact and what’s fiction. One thing is true – there is plenty of misinformation when it comes to real estate. Here are five popular myths that are not true when it comes to buying or selling real estate in today’s market.

Myth #1 – Buying a house is always the best financial decision

There can be truth to the statement, “buying a house can be a good financial decision”, after all, buying a house is often the biggest purchase someone will ever make. However, there are times when it is simply not financially responsible to buy a house. Some examples of these times include:

  • When your debt to income ratio is too high
  • If your cash flow is limited
  • If you have a lack of personal savings
  • You have instability in your job

In short, if your disposable income is low and/or your debt to income ratio is high, it may not be wise to take out a mortgage. In addition, the goal of buying a house should never just be about buying as soon as possible. It can be easy to get swept up into the idea of homeownership but it’s advisable to look closely at your assets, make a plan, and embark upon that process when it makes the best financial sense to do so.

Myth #2 – You should buy as much home as you can afford

If you buy as much home as you can afford, you’re potentially setting yourself up for difficulty with the lemons life may throw your way. Not only will you be paying your monthly mortgage payments, but you’ll also be responsible for any unexpected repairs and the routine upkeep that come with owning a home. It’s better to buy a modest home that you can comfortably afford instead of stretching your budget to buy a larger one.

Myth #3 – A bigger house means a better return on investment

This is not always the case. A bigger house costs more to buy and maintain. So, unless you’re able to get a significantly higher price for your home when you sell it, you may not see as good of a return on your investment. In addition, the market conditions at the time of your sale will affect your final selling price. It’s not always possible to predict whether the market will be high or low at the time of your sale, but you can look at similar homes in your areas to get an idea of how much they are selling for.

Myth #4- The more expensive the house, the better it will be for reselling in the future

Similar to above, market conditions can be difficult to predict. The more expensive a house is, the more difficult it will be to sell at a price that makes you a profit. However, there are some other factors that can affect whether your home has good resale value:

Some of these items include:

  • Your home is located in a desirable neighborhood
  • The cost of living near your home is reasonable for those looking to buy it
  • You’ve made updates to the home – especially kitchen and bathroom

Myth #5- I don’t need a real estate agent to help me buy or sell a home

Research has shown that homes marketed by agents tend to sell for more money and in a shorter amount of time than those that are not. For example, according to the National Association of Realtors, a typical for-sale-by-owner home sold for $260,000 vs $318,000 for an agent-assisted home sale.

An agent can help you negotiate the best possible price for your home. They will have extensive knowledge about the market conditions in your area and can advise you on when to buy or sell.

An agent will be able to refer you to reputable lenders, contractors, and other professionals who can help you fix up or clean your existing home or get estimates on costs to remodel a potential new home. Their networks are deep with people who are skilled in multiple facets of the real estate process and the needs of homeowners.

If you want the best possible experience with real estate, it’s very advisable to work with a realtor.

In summary, there are a few myths that people often believe about buying and selling homes. However, it’s important to remember that there is no one-size-fits-all answer when it comes to making these decisions. You should always consult with a professional before taking any major steps in the real estate process.

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Are you a senior looking to downsize? How to avoid the “downsizing regret”

Downsizing regret is a term that describes buyers who move into smaller homes and then regret their decision.  These buyers often feel cramped in their new homes and miss the extra space they had in their previous residences.

A recent survey suggests that 29% of seniors who’ve retired and moved have done so to “downsize”. What could have been the “golden years” in their new space may instead become a source of discontent and regret.

1. Consider emotional aspects

When downsizing, it’s important to consider the emotional aspects of your decision. It’s not just about the number of bedrooms and bathrooms – it’s about how you want to live now.

Life transitions can lead you to consider change, and when paired with a recent retirement, you may be feeling “ALL the feels” at once. It’s important not to make decisions too quickly, and with great consideration. By objectively working through whether your current home “fits” your new lifestyle, you’ll be able to embrace your transition more fully.

2. Know what you want in a home

Location, size, and amenities all play a role in finding the right home.

Is the new location convenient for driving? Is it near seniors’ services or transportation? What about medical services? Are you within a convenient driving location to family and friends?

These questions may feel daunting and possibly even overwhelming.  But if you take the time to answer them, you can begin to see a clearer picture of what you want in your next home. Think of what you not only need now but in the future, as well.

3. Be realistic about your living space needs

The number of bedrooms and bathrooms you need in retirement may not be the same as when you were raising a family.

Think about your hobbies, whether you’ll have guests over often and what activities you want to take part in. For example, if you love to cook but don’t have groups of friends (and children’s friends!) who visit anymore, will a large kitchen with lots of counter space be needed?

Remember, it’s not about filling up space just for the sake of having extra room. How will you use the space?

And, of course, don’t forget about your yard space. Do you want to spend time mowing the lawn, shoveling snow, and maintaining a garden? Or does a smaller yard with less maintenance free you up for hobbies that you’d like to participate in?

4. Recognize the benefits

Recognize that there are many benefits to downsizing that you may have not thought of, but yet may be quite appealing.

For example:

  • Less responsibility
  • Lower maintenance costs
  • Smaller house size = easier to clean!
  • Lower heat and utility bills
  • Less maintenance = more time for travel, hobbies, and time with family

In addition, there may be tax benefits to downsizing. Be sure to consult with your accountant or financial advisor to see what options may be available to you.

5. Be realistic about what comes with you to your new space.

You may be bringing items from your larger home that you thought you “had to have”, but really just take up space and don’t fit into your life as it is now.

For example, your 8-person dining room table might be great for big holiday dinners with family, but you may not host those large gatherings anymore. 

Downsizing doesn’t have to mean making sacrifices or giving up everything you’ve held dear for so many years. It can be an exciting time of change and growth.

Think about what you can live without and what will truly enhance your new lifestyle. And if certain items aren’t bringing value to your life, why not sell them? You can use the money for fresh new furniture, art, and accessories or even a trip to an exotic location on your bucket list! Making memories with others is a true gift.

6. Get help from an expert to determine what will work best for your needs and budget.

Making such a big life change is complex.  You don’t have to go through it alone.

There are many professionals who can help you downsize your home in a way that is best for you and your family. Interior designers, professional organizers, and downsizing experts can all offer valuable advice on what will work for your unique situation.

Taking the time to make a thoughtful decision about downsizing and living arrangements can help you embrace your next chapter and create a home that truly reflects the life you wish to live.

As you approach this decision and are looking for a realtor to help you through the process, contact me! I would be honored to assist you.

By taking the time to answer some key questions about your needs and desires, you can begin to see a clear picture of what type of home will best suit your retirement years.

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How to Make Moving in the Winter Easier and Safer

So you’ve just bought a new house and your closing date falls in the winter months, which means your move date probably will, too. While winter moving allows you to avoid the summer heat and humidity, it does come with its own set of difficulties. If you’re planning on making this move in the winter, keep these tips in mind.

1. Have someone help you with your kids and/or pets

Moving can be difficult and even dangerous for kids and pets. Before the moving day, plan to have your kids and pets stay with a trusted friend or family member so that they are less apt to be injured by moving furniture or falling boxes, or even escape out an open door in a distracted moment.

Since your kids are probably very excited about their new spaces, bring them by the new house for a brief period of time, if possible, before the moving activity begins. This will help them visualize their new space, but then they can be safely out of the way while movers or other friends and family are doing the heavy lifting and moving. Remind them that they’ll get to experience their new space when it’s safe and less chaotic.

In your new home, make note of where special items such as certain toys or anything important to your child are placed. This will help give them a space to be entertained while you’re doing the very important work of unpacking over the next few days and weeks.

Have pets? Keeping pet carriers or crates in a quiet location will help your pet become acclimated more quickly and safely after your “move” is complete.

2. Hire Help

Moving by yourself may seem like the cheapest option, but for a relatively small amount of money, moving companies can do the heavy lifting and help you avoid back injuries. An added bonus…moving companies are faster, less apt to break items (and are insured if they do!) and accustomed to doing this every day. Their experience will help to make your move less complicated and dangerous.

3. Save big items for daylight hours

If possible, schedule your move to take place during the day so that you don’t need to worry about having enough lighting to see where you are going. This is also safer than moving at night when you can’t easily “see” any obstacles in your way, or patches of ice and snow.

4. Be well-stocked with food and drinks

While your movers are doing the heavy lifting, you’ll spend a lot of time carting boxes around, opening up cupboards, putting together furniture…the list goes on! Make sure that you have plenty of water and sports drinks available to keep yourself hydrated while working. Having a crockpot handy with a simple warm meal can help take the edge off of the winter chill. Similarly, hot tea or coffee that you can offer those helping you move will be greatly appreciated. Moving day is hard work and will feel like a long exhausting day.

4. Make Sure Your Driveway and Sidewalks are Clear

Check the weather forecast a few days ahead of time to help you prepare for any snowy, cold conditions. On the morning of the move, clear your driveway of any snow and make sure your entranceway is free of ice. The last thing you want to happen is for you or your movers to slip and fall.

Know where your shovels and snowblower are; as you know, our Minnesota winters can give us some surprises, including unexpected snowfalls or sleet.

5. Heat, Electricity, and Water Services

Before your moving day, verify service activation with utility companies – such as the electric company, gas company, and water company – and ensure that services will be turned on in your new home on the day of your move. You may even want to ask them to have someone come out and turn on the heat a day or two before you move in to help get things started. Of course, if your new home is currently occupied, they are likely using the utilities, so simply transferring the service to you on moving day will help avoid a service lapse, and potentially frozen pipes!

6. Be aware of items that may be affected by the cold.

Electronics, including cell phones and computers, may need special attention. Keep your electronics in a closed box with some type of padding to prevent damage due to temperature changes. Some items may become more brittle in the cold temperatures such as glassware or ceramics. Be sure to wrap these items well and place them in a labeled container when transporting them from house to house.

Enjoy the day!

No doubt, moving is tough work. However, keep focused on the excitement of being in your new space and think ahead to when you can snuggle up on the sofa with hot cocoa and watch a snowfall from your new window! The time and effort will be worth it!

If you have any questions on your move, please don’t hesitate to ask – as a Realtor in the Lakeville, Apple Valley and Burnsville area, I’ve assisted hundreds of families just like yours in navigating the home buying and selling process.

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6 Steps to Help You Get the Most Out of Your First Home Purchase

Buying a home is one of the biggest decisions you’ll ever make in your lifetime. Also, it will probably be the most important financial decision of your life. The idea of finally owning a home can be very emotional, and it is easy to make decisions based on emotions rather than logic.

If you are trying to find the best value for your money, here are six steps that will help you learn how to get the most out of your first home purchase.

Step 1: Find houses that are within your budget and worth your investment

The first step in buying a house is to find houses that are within your budget and worth your investment. This process is primarily done through house inspection, but you also want to make sure that the house is on the market for a reasonable time before you purchase it and that not too many people are trying to buy it.

There are three ways to evaluate if the property is worth its price. One way is by looking at real estate listings online, finding out which houses are currently on the market, and then checking them against your criteria of what you’re looking for. The second way is through friends or family members who already own one of these properties, have recently purchased one of these properties, or have lived in one of these homes before. The third way would be using a home inspection checklist which will give you all of the information you’ll need to make an informed decision.

Step 2: Map your monthly expenses, earnings, and liabilities

What are the main steps involved in mapping out monthly expenses, earnings, and liabilities? Budgeting is an important task that can help you avoid financial stress. It is important to track your expenses and try to limit the amount of money that you owe.

The main steps involved in mapping out your expenses, earnings, and liabilities are as follows:

• Track your expenses and try to limit the amount of money that you owe

• List all monthly bills that will be paid in the new property (water, gas, electricity)

• List all monthly debts that will be used to finance the property (mortgage, credit cards)

• List all income that will be used to pay these bills/debts (paycheck, savings account)

• List any work projects or side gigs that might help fund your purchase

This step is very important because it helps you to analyze how much money can be saved or made by making certain changes to your lifestyle. It also provides you with a general idea of what kind of home you need to buy as well as what type of property suits your needs.

Step 3: Determine what the market will bear

The initial market size is important for determining what to expect in the future. This is because the value of your property will be primarily determined by how many others are looking to buy similar kinds of properties.

You can determine this by looking at what other properties are on the market and how much they are selling for. The less expensive properties that are currently on the market, indicate that there is a lot of demand for them. If you want to sell your property quickly one day in the future, it’s best to look into properties that have already sold quickly.

Step 4: Make a list of your requirements for a home

It is important to create a list of requirements for the perfect home before you start looking for houses. The requirements are not about what you need but what you want.

Before you buy your first home, be sure to make a list of all the things that are important to you. This includes your budget, features, and amenities. Once it is complete, be sure to share it with your realtor so they can help find the perfect house for you.

Now that we have our criteria in place, let’s talk about how to go through the process of setting a budget for your next house!

Step 5: Set a budget for the property you want to buy

Determine what is your personal definition of “affordable?”

What does affordable mean to you? This is a simple question with a complex answer. Some people will say “affordable” is anything less than $500,000. But that’s not the case for everyone. There are many people who believe that “affordable” means a home that costs less than $200,000. The answer to this question will primarily depend on your income and monthly expenses.

Calculate your monthly expenses

Buying a home is a major financial commitment. It takes time and careful planning to ensure that you can afford your new house, but it’s worth the effort. Even if you borrow money from family or friends, you’ll still need to calculate how much you can afford before making the purchase.

Assess what percentage of your monthly income would go towards housing

With the average price of a house in the U.S. reaching nearly $500,000, many people are finding it difficult to afford a home on their salary alone. To make things even more challenging, the mortgage interest deduction has been capped at $750,000 for new purchases. As a result, it’s now more important than ever to figure out how much your housing costs will be compared to your income.

Calculate the median home price in your area

Median home prices are a great way for first-time buyers to estimate how much they can afford. The median price is the point at which half the homes in the area sell for more, with the other half selling for less. For example, if you want to know what your monthly payment would be on a $200,000 property with a 30-year mortgage, there is an easy formula you can use: $200,000 divided by 360 (total months). If the median home price in your desired area is above this value (what you can afford in a single month), then you should probably look for a home in a different area.

Step 6: Make an offer on the property that you have listed as your top choice

Finally, it’s time to make an offer on the property you have listed as your top choice! It is a good idea to make a quick offer on the property if it’s your first choice. If you are looking for a bargain, make an offer of around 90-95% of the asking price. If the seller accepts, then you will have bought your first home at a very reasonable price.

You want to make sure that you are in the driver’s seat in this negotiation. Make sure that your offer is in writing, with enough information to move this process along quickly. This will allow you to avoid any mishaps and get the property that you really want.

Conclusion

The process of buying a house is not easy, and there are many steps involved. Having a licensed Realtor in your corner to help you navigate the process can ease the stress greatly.  You don’t have to “go it alone”! Contact me to schedule a no obligation consultation today.

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Tips for a Simple and Stress-Free Move

Tips for Stress Free Moving

Moving can be extremely stressful, especially when you haven’t planned properly for the big day. Recent surveys have found that moving is at the top of the list of stressful life events, including divorce, starting a new job, and having children. Most of us have experienced the typical moving day scenario: waking up on the morning of moving day, surrounded by boxes, bags, and furniture. Everyone’s desperate for a cup of coffee, but the mugs have already been packed and there’s not a spoon in sight. Then, much to everyone’s horror, the moving company arrives before the last boxes are packed. By the end of the day, the new house is overflowing with boxes, nobody can find what they need and tempers are flaring. It’s not the ideal way to spend the first night in a new house.

Moving day doesn’t have to be so stressful, though, as much of the pressure can be eliminated by employing some simple strategies. Planning your move effectively allows for a peaceful moving day and an easy transition into your organized new home. Moving can be an exciting, happy experience with the help of some easy tips.

Declutter Before Packing

Moving to a new house creates the perfect time and space to declutter. It’s a fantastic opportunity to rid yourself of old documents, clothes, electronics, books, and unwanted furniture. There are many different methods of decluttering, but the easiest involves working on one room at a time with separate piles for throwing away, keeping, and donating. When you’re finished working on a room, remove the donations and rubbish. Then, separate the items that you’re keeping and organize them into piles of similar items. If you struggle to get rid of clutter, it can be tempting to retrieve items from the donation pile, so organize to drop them off at a charity as soon as possible.

Personal documents that are no longer needed should be destroyed and sentimental items should be kept aside for separate packing. If you’re unsure as to whether to donate or keep something, hold on to it until the end of the process, then make a final decision. When moving to a smaller home, it’s important to declutter as much as possible. Objects like children’s artwork, cards, documents, and photos can be stored digitally to save physical space.

Staging to Sell

If your house is still listed for sale, packing may prove tricky as you’re still having regular showings to prospective buyers. The house needs to look its best in order to sell. Decluttering and packing is a messy process and it can detract from the overall appeal of a home.

Staging to sell is an effective method that enables buyers to picture the house as their own, as they’re able to visualize their own possessions in the home. This means removing anything that is personal, like photos, mementos, and ornaments. Clear the surfaces of shelves, especially in bathrooms and bedrooms, and try to keep colors as neutral as possible. Get rid of as much clutter as you can, including unnecessary furniture, as space creates the impression that the house is bigger and lighter. If you can, store packed boxes in a designated storage area, like a garage. However, if you don’t have storage space, pack boxes neatly against the walls. Deep clean neglected areas, especially blinds and windows, and add some fresh finishing touches, such as a vase of flowers or potted plants.

Intentional Packing

As each group of items is packed, label both the room and a list of the specific items on each side of the box for easy identification at the new house. Color-coding the boxes with a simple colored sticker per room enables both yourself and the moving team to recognize immediately where to group and place the boxes so that they don’t need to be moved from room to room. Ensure that you have strong storage boxes for fragile items and wrap them separately to keep them safe. Clearly mark them as fragile. Clothing on hangers can be packed on the hanger, if you have enough boxes and transport space, as it’ll save time during the unpacking period. When packing heavy items, such as books, double tape the bottom of the box to prevent breakage and try to limit the number of heavy objects per box.

Moving Day Prep

Preparation is essential for a smooth move. The day before moving, after most household goods have been packed, clean out appliances like the fridge, freezer, microwave, and oven. Throw away expired food and ensure that you have a cooler bag and ice packs ready to transfer food from the fridge and freezer during the move. Have a quick, easy breakfast prepped as well as snacks, drinks and something simple for lunch. When moving with pets, don’t forget pet food, bowls, and crates for the journey. Pack an overnight bag for each member of the family, containing an extra set of clothes, daily medication, toiletries, a towel, and personal items, as it may be difficult to unbox these items the same day of the move. If little children are part of the move, include a small bag of favorite toys and books to entertain them while you’re busy unpacking. Pack a set of bedding for each person, including sheets, pillows, and blankets, so that the first night in your new home is as comfortable as possible.

Freeze a cooked meal for that night’s dinner, to be reheated, or find a delivery service in your new area to order take-out easily.  Make sure that your cell phone and an extra battery pack is charged, since you may have to coordinate with movers, family, and friends all day. Set an alarm to wake up earlier than usual, so that you have more time to deal with unforeseen problems.

Moving Day

Moving day can feel frantic as the moving team works their way through your old home, packing pieces of furniture, appliances, and boxes. If a family member or friend can babysit children and pets for the day, it could allow for a smoother move. However, if kids and pets are part of the move, make sure that they’re fed and entertained in a room away from the busiest part of the move, to keep them safe and prevent jarred nerves.

As you leave your old house, make sure that you check everything for the final time to make sure that you’ve left nothing behind.

Provide the moving team with instructions that link the color-coded boxes to their specific rooms in the new house, if possible. Once furniture, boxes, and appliances are being moved into the new house, don’t start unpacking boxes randomly. Instead, pack the fridge first from cooler boxes and set up safe spaces for little kids and pets. Put linen on the beds, ready for the night. Then, start the exciting process of unpacking and organizing your new house. Start with the kitchen, since those would most likely be the items that you’ll need first.

As you spend your first night in your new house, remind yourself that it may take some time to get all your boxes unpacked and feel settled. Instead of rushing through unpacking, take your time to absorb the flow of your new home. Enjoy creating new spaces and memories while celebrating a move without the usual stress and tension!

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How to Stay Under Budget When Buying a Home

How to Stay on Budget When Buying a Home

For most people, purchasing a home will be the largest financial transaction they ever make. As such, it is extremely important that you manage to stay within your budget. After all, the amount of money you spend will directly impact your finances for the next 10-20 years. 

Luckily, there are some easy tips you can follow, in order to keep things under budget, such as:

Establish a firm budget and communicate it to your real estate agent.

Before you can stick to a budget, you will first need to come up with a budget. Once you have decided what that number will be, it is important that you make it firm. This means, don’t tell your real estate agent that your budget is “around $300,000” or “$300,000-ish” if your actual budget is $275,000. By telling them exactly what you can afford, they can find you houses that make sense for you.

Avoid looking at out-of-budget homes.

When looking through your home purchase options, try to avoid looking at houses that are out of your budget. It can be very easy to convince yourself that it is worth it to pay an extra $20,000-$30,000 for a want vs. a need. However, if you can’t afford it, then you are just going to be torturing yourself unnecessarily. Stick to homes that you can afford.

Look at houses that have been on the market for a while.

Homes that have been on the market for a few months (or weeks in a seller’s market), can sometimes offer some excellent value. Because sellers will be anxious to complete a deal soon, they are often willing to negotiate on the terms of the deal. If you play your cards right, you can potentially negotiate thousands of dollars off of the home’s purchase price.

Ultimately, whether or not you can stick to your budget will come down to your level of self-control and willingness to negotiate. By following the advice contained in this article, you will be giving yourself the best possible chance of finding an excellent home that you can comfortably afford.

We’re here for you.

We understand that the home buying process is complex and filled with emotion. However, my goal is to provide you with comfort and reliability, as you’re navigating through the highs and lows of the real estate market, with the ultimate goal of finding your new home that fits your needs. Schedule a no-obligation first meeting with me here.

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