In the Washington Post last week, writer Emily Badger wrote about an interesting situation occuring in Los Angeles. Second units on single family lots are becoming increasingly popular in cities that have limited housing options with dramatically rising prices.
Those that were given permission to build won’t be given certificate of occupancy, therefore they can’t be added to public services, like the power grid. This has left some with living off of extention cords to the main house. All this after a lawsuit was brought against the city
Proponants say it can ease housing shortages and yeild more affordable houseing that won’t cost the city anything. It have help aging baby boomers and still-at-home millennials too.
Protesters say that these 2nd homes (LA’s rules stating can be no larger than 1200 sqft) change the feel of single family home neighborhoods. There will be too many people and less parking. They also fear more people in smaller homes would create a kind of affordable housing among expensive LA real estate.
The city of Los Angeles says that the issues should be resolved by the years end but many people still hang in limbo until that happens.
Here’s a great article written by Re/Max of Boulder’s own Haley Robinson. Enjoy!
Staging will highlight the strengths and downplay the weaknesses of you home and, if done right, will appeal to the greatest number of buyers.
Here are just a few hints on how to stage your home for sale.
Declutter and Clean
This is the absolute most important thing you can do to stage your home. Depending on how you live, I tell my clients to remove 50% of whatever is in view when you walk into a room. That’s books on the book shelves, art, things on counters, bedside tables, office desks, etc. Take those things and pack them in boxes or find it a new home in a cabinet or drawer.
Cleaning seems like an obvious one but I always reiterate it with my clients. When someone comes for a showing, there shouldn’t be baskets of laundry, food sitting out, unmade beds or really any proof that you were just there in the home. Also, organizing all cabinets, closets, and drawers, as people usually want to look inside. It should be in show ready condition for every showing, which can be difficult and stressful especially if you have kids and/or pets.
It also includes a deep clean. Dusting is very important as well as washed cabinets in the kitchen and all bathrooms, washed walls, clean toilets and showers, washed baseboards, and so on.
Depersonalize
When there is a showing in your house, the clients walk in and immediately they ask themselves, “Can I see myself living in this home?” And it’s 10 times harder for them to answer “yes” if they are staring at your family portrait over the fireplace or the kid’s drawings on the fridge. Depersonalizing your home will make room for the idea of someone else living there.
It’s not only framed family pictures but also fridge magnets, wall hangings, large art pieces, magazines, calendars, mail piles, and so on. This can also include political and/or religious objects. While it’s not my job to snuff out a clients personal beliefs, I encourage neutrality as much as the client is willing do.
This can sometimes be emotional for the homeowner. I try to prepare my clients that they may find themselves upset or sad during this step. It’s really the first step in saying good bye to your current home and, for some, it can be difficult.
Neutrality
This kind of falls into the depersonalization as well. That lovely floral wall paper, that bold rug, that bright bed comforter may be what you love most but to a potential buyer, it’s all they can see. They don’t see the great light coming in through the extra large double paned windows, all they see is the shade of green that the room is painted and how much they hate the color green. They don’t notice the open floor plan, all they see is the stuffed moose head. These are extreme examples but you get my point.
Getting your home neutral is important for visual people so they can actually see the home and it’s great potential. This may require repainting a room, changing the décor or even adding items like a lamp for extra light or a neutral rug to help brighten a dark wood floor.
Safety
This is my least favorite but most important topic to cover. We like to think of most people as good and honest but there are some jerks out there. Desperate and/or bad people come to open houses and showings, so with that in mind, certain steps need to be taken.
All expensive items, like jewelry, cash, etc, need to be put in a safe, inaccessible place. This also goes for any prescription drugs. I have personally caught someone elbow deep in a drawer containing prescription meds. The owners didn’t lock them up and it gave this person the opportunity to try and steal from them. Most important, all firearms need to be locked, put away with the ammo elsewhere, and preferably taken out of the home to another location. This can also include other weapons/art like bows, spears and the like.
Lastly, for fun, here are some actual, honest-to-goodness photos of homes for sale pulled from the MLS from around the country. Names and cities have been changed to protect the innocent…
A GREAT article by fellow Realtor Jay Kalinski! If you you are thinking of buying or selling the near future, read this article!
As predicted, the Federal Reserve raised interest rates in December, and conventional mortgage rates have increased from 3.625 percent on Nov. 4 to 4.375 percent as of the writing of this article (an increase of 0.75 percentage points). In 2017, economists predict a couple more interest-rate increases to the Fed funds rate, which will likely spur increases in conventional mortgage rates as well.
To a homebuyer in the Boulder Valley, what do these projected mortgage-rate increases actually mean? The effect may be bigger than you would think.
The 1 Percent = 10 Percent Rule
As a rule of thumb, for each 1 percent increase in mortgage rates, your buying power decreases about 10 percent. To understand the import of this, it is helpful to use a couple of examples that buyers in the Boulder Valley might face:
Scenario 1: Looking in Longmont
A couple would like to buy an average single-family home in Longmont, which costs about $400,000. They have about $80,000 (or 20 percent) saved as a down payment and meet with a lender, where they learn that they qualify for a maximum principal and interest payment of $1,600 per month.
If the current interest rate is 4 percent, then their monthly principal and interest payment would be about $1,528, and they would qualify to buy the house. (They could qualify up to $420,000 in the case of a bidding war.)
If, however, the interest rate increased to 5 percent, then the monthly principal and interest would increase to $1,718, and they would not qualify to buy the home. In fact, at this new interest rate, they would qualify to purchase only a $377,000 home (principal and interest of $1,595).
For this couple, a 1 percent increase resulted in a decreased purchase power of about 10.2 percent.
Scenario 2: Looking in Boulder
A couple would like to buy an average single-family home in Boulder, which costs about $1 million. They have about $200,000 (or 20 percent) saved as a down payment and meet with a lender, where they learn that they will need a jumbo loan, and that they qualify for a maximum principal and interest payment of $4,000 per month. (A jumbo loan is one that exceeds the conforming loan limits set by the Federal Housing Finance Agency, which, in Boulder County is $479,950.)
If the current interest rate is 4 percent, then their monthly principal and interest payment would be about $3,820, and they would be able to buy the house. (They could qualify up to $1,050,000 in the case of a bidding war.)
If, however, the interest rate increased to 5 percent, then the monthly principal and interest would increase to $4,295, and they would not qualify to buy the average home. In fact, at this new interest rate, they would qualify to purchase only a $945,000 home (principal and interest of $4,000).
For this couple, a 1 percent increase resulted in a decreased purchase power of 10 percent.
Price appreciation
The above scenarios consider only increasing interest rates. When you factor in price appreciation, which was roughly 15 percent last year for single-family homes in Boulder County, it increases the magnitude of lost purchasing power for buyers.
The Bottom Line
Many buyers in the Boulder Valley have felt a sense of urgency in the past several years, given the quickly appreciating housing market. The prediction of increasing interest rates and, therefore, decreasing purchasing power, will likely add further pressure to buyers to purchase a home quickly before they are priced out of the homes they desire.
Jay Kalinski is broker/owner of Re/Max of Boulder.
