10 Things to Take the Trauma Out of Home Buying

1. Find a real estate agent that’s simpatico. Homebuying is not only a big financial commitment, but also an emotional one. It’s critical that the agent you chose is both skilled and a good fit with your personality.

2. Remember, there’s no “right” time to buy, any more than there’s a right time to sell. If you find a home now, don’t try to second-guess the interest rates or the housing market by waiting. Changes don’t usually occur fast enough to make that much difference in price, and a good home won’t stay on the market long.

3. Don’t ask for too many opinions. It’s natural to want reassurance for such a big decision, but too many ideas will make it much harder to make a decision.

4. Accept that no house is ever perfect. Focus in on the things that are most important to you and let the minor ones go.

5. Don’t try to be a killer negotiator. Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price may lose you the home you love.

6. Remember your home doesn’t exist in a vacuum. Don’t get so caught up in the physical aspects of the house itself—room size, kitchen—that you forget such issues as amenities, noise level, etc., that have a big impact on what it’s like to live in your new home.

7. Don’t wait until you’ve found a home and made an offer to get approved for a mortgage, investigate insurance availability, and consider a schedule for moving. Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to sellers.

8. Factor in maintenance and repair costs in your post-home buying budget. Even if you buy a new home, there will be some costs. Don’t leave yourself short and let your home deteriorate.

9. Accept that a little buyer’s remorse is inevitable and will probably pass. Buying a home, especially for the first time, is a big commitment, but it also yields big benefits.

10. Choose a home first because you love it; then think about appreciation. While U.S. homes have appreciated an average of 5.4 percent annually over from 1998 to 2002, a home’s most important role is as a comfortable, safe place to live.

5 Things to Understand about Homeowners Insurance

1. Look for exclusions to coverage. For example, most insurance policies do not cover flood or earthquake damage as a standard item. These coverages must be bought separately.

2. Look for dollar limitations on claims. Even if you are covered for a risk, there may a limit on how much the insurer will pay. For example, many policies limit the amount paid for stolen jewelry unless items are insured separately.

3. Understand replacement cost. If your home is destroyed you’ll receive money to replace it only to the maximum of your coverage, so be sure your insurance is sufficient. This means that if your home is insured for $150,000 and it costs $180,000 to replace it, you’ll only receive $150,000.

4. Understand actual cash value. If you chose not to replace your home when it’s destroyed, you’ll receive replacement cost, less depreciation. This is called actual cash value.

5. Understand liability. Generally your homeowners insurance covers you for accidents that happen to other people on your property, including medical care, court costs, and awards by the court. However, there is usually an upper limit to the amount of coverage provided. Be sure that it’s sufficient if you have significant assets.

10- Ways to Lower Your Homeowners Insurance Costs

1. Raise your deductible. If you can afford to pay more toward a loss that
occurs, your premiums will be lower.

2. Buy your homeowners and auto policies from the same company and you’ll usually qualify for a discount. But make sure that the savings really yields the lowest price.

3. Make your home less susceptible to damage. Keep roofs and drains in good repair. Retrofit your house to protect against natural disasters common to your area.

4. Keep your home safer. Install smoke detectors, burglar alarms, and dead-bolt locks. All of these will usually qualify for a discount.

5. Be sure you insure your house for the correct amount. Remember, you’re covering replacement cost, not market value.

6. Ask about other discounts. For example, retirees who are home more than working people may qualify for a discount on theft insurance.

7. Stay with the same insurer. Especially in today’s tight insurance market, your current vendor is more likely to give you a good price.

8. See if you belong to any groups—associations, alumni groups—that offer lower insurance rates.

9. Review your policy limits and the value of your home and possessions annually. Some items depreciate and may not need as much coverage.

10. See if there’s a government-backed insurance plan. In some high-risk areas, such as coasts, federal or state government may back plans to lower rates. Ask your agent.

15 Tips for Packing Like a Pro

1. Plan ahead by organizing and budgeting. Develop a master “to do” list so you won’t forget something critical. To estimate moving costs, use a moving calculator.

2. Sort and get rid of things you no longer want or need. Have a garage sale, donate to a charity, or recycle.

3. But don’t throw out everything. If your inclination is to just toss it, you're probably right. However, it's possible to go overboard in the heat of the moment. Ask yourself how frequently you use an item and how you’d feel if you no longer had it. That will eliminate regrets after the move.

4. Pack like items together. Put toys with toys, kitchen utensils with kitchen utensils. It will make your life easier when it's time to unpack.

5. Decide what, if anything, you plan to move yourself. Precious items such as family photos, valuable breakables, or must-haves during the move should probably stay with you. Don't forget to keep a "necessities" bag with tissues, snacks, and other items you'll need that day.

6. Use the right box for the item. Loose items are prone to breakage.

7. Put heavy items in small boxes so they’re easier to lift. Keep weight of each box under 50 pounds, if possible.

8. Don’t over-pack boxes. That will increase the chances that items inside the box will break.

9. Wrap every fragile item separately and pad bottom and sides of boxes.

10. Label every box on all sides. You never know how they’ll be stacked and you don’t want to have to move other boxes aside to find out what’s there.

11. Use color-coded labels to indicate which room each item should go in. Color-code a floor plan for your new house to help movers.

12. Keep your moving documents together in a file. Including important phone numbers, driver’s name, and moving van number. Also keep your address book handy.

13. Back up your computer files before moving your computer.

14. Inspect each box and all furniture for damage as soon as it arrives.

15. Remember, most movers won’t take plants. If you don't want to leave them behind, you should plan on moving them yourself.

 7 Steps to Preparing for an Open House

1. Hire a cleaning service. A spotlessly clean home is essential; dirt will turn off a prospect faster than anything.

2. Pay attention to the outdoors. Mow your lawn, and be sure toys and yard equipment are put away.

3. Serve cookies, coffee, and soft drinks. It creates a welcoming touch. But be sure the kitchen has been cleaned up; use disposable cups so the sink doesn’t fill up.

4. Lock up your valuables, jewelry, and money. Although the real estate salesperson will be on site during the open house, it’s impossible to watch everyone all the time.

5. Turn on all the lights. Even in the daytime, incandescent lights add sparkle.

6. Send your pets to a neighbor or take them outside. If that’s not possible, crate them or confine them to one room (a basement or bath), and let the salesperson know where to find them.

7. Leave. It’s awkward for prospective buyers to look in your closets and express their opinions of your home with you there.

Make Your Home Irresistible: 10 Open House Tips

1. Add a touch of color. Use fresh or silk flowers to breathe life and color into the main rooms. A colored afghan or throw on the couch will jazz up a dull room.

2. Make the bathrooms feel luxurious. Put away those old towels and toothbrushes. When buyers enter your bathroom, they should feel pampered. Add a new shower curtain, fresh towels, and fancy guest soaps.

3. Does it smell good? Set out potpourri or fresh baked goods for a homey smell. Make sure that there are no lingering scents from cigarettes or pets.

4. Help them envision living there. Set the table with pretty dishes and candles, and create other vignettes throughout the home to help buyers picture themselves there. For example, in the basement lay out a chess game.

5. Beautify the entrance. Buy a fresh doormat with a pretty pattern or a clever saying.

6. Make the rooms feel bigger. Take one or two major pieces of furniture out of every room to create a sense of spaciousness.

7. Accentuate counter space. Put away kitchen appliances and personal bathroom items to give the illusion of more counter space.

8. Lay logs in the fireplace. Or put a basket of flowers there if it’s not in use.

9. Depersonalize the rooms. Put away family photos, mementos, and distinctive artwork.

10. The lawn should sparkle. Turn on the sprinklers for 30 minutes to make the lawn sparkle.

10 Ways to Make Your House More Saleable

1. Get rid of clutter. Throw out or file stacks of newspapers and magazines. Pack away most of your small decorative items. Store out-of-season clothing to make closets seem roomier. Clean out the garage.

2. Wash your windows and screens to let more light into the interior.

3. Keep everything extra clean. Wash fingerprints from light switch plates. Mop and wax floors. Clean the stove and refrigerator. A clean house makes a better first impression and convinces buyers that the home has been well cared for.

4. Get rid of smells. Clean carpeting and drapes to eliminate cooking odors, smoke, and pet smells. Open the windows.

5. Put higher wattage bulbs in light sockets to make rooms seem brighter, especially basements and other dark rooms. Replace any burnt-out bulbs.

6. Make minor repairs that can create a bad impression. Small problems such as sticky doors, torn screens, cracked caulking, or a dripping faucet may seem trivial, but they’ll give buyers the impression that the house isn’t well maintained.

7. Tidy your yard. Cut the grass, rake the leaves, trim the bushes, and edge the walks. Put a pot or two of bright flowers near the entryway.

8. Patch holes in your driveway and reapply sealant, if applicable.

9. Clean your gutters.

10. Polish your front doorknob and door numbers.


5 Ways to Speed Up Your Sale

1. Price it right. Set a price at the lower end of your property’s realistic price range.

2. Get your house market ready for at least two weeks before you begin showing it.

3. Be flexible about showings. It’s often disruptive to have a house ready to show on the spur of the moment, but the more often someone can see your home, the sooner you’ll find a seller.

4. Be ready for the offers. Decide in advance what price and terms you’ll find acceptable.

5. Don’t refuse to drop the price. If your home has been on the market for more than 30 days without an offer, be prepared to lower your asking price.

Understanding Capital Gains in Real Estate

When you sell a stock, you owe taxes on your gain—the difference between what you paid for the stock and what you sold it for. The same is true with selling a home (or a second home), but there are some special considerations.

How to Calculate Gain
In real estate, capital gains are based not on what you paid for the home, but on its adjusted cost basis. To calculate this:

1. Take the purchase price of the home: This is the sale price, not the amount of money you actually contributed at closing.

2. Add Adjustments:

• Cost of the purchase—including transfer fees, attorney fees, inspections, but not points you paid on your mortgage.
• Cost of sale—including inspections, attorney’s fee, real estate commission, and money you spent to fix up your home just prior to sale.
• Cost of improvements—including room additions, deck, etc. Note here that improvements do not include repairing or replacing something already there, such as putting on a new roof or buying a new furnace.

Travel Tip: Check the Expiration Date on Your Passport

By Lori Appling

More and more countries are insisting that visitors' passports have at least a six-month shelf-life ... and they won't let you in if your passport expires sooner than that. So before your next international trip, make sure your passport is valid for at least six months beyond your return date.

For information about renewing your passport, visit the U.S. State Department website (travel.state.gov/passport_renewal.html). Or check out these two online companies that will get you a speedy renewal for a fee: passportvisaexpress.com  and passportplus.net.

Resolve To Protect Your Household's Bottom Line

You procrastinated again.

More than a week into the New Year and you still haven't made up your mind what you'll resolve to improve, change, or accomplish.

A home owner advocacy group is here to help.

The American Homeowners Foundation (AHF), a consumer research and education group and its lobbying arm, the American Homeowners Grassroots Alliance, have some pretty good ideas.

They think you should get your financial house in order.

Considering the housing boom has taken a turn and the economy isn't certain which way is up, making sure your home economy isn't headed for a recession is a good idea.

"We think you should look at things from the point of your economic best interests," said Bruce Hahn, president of the dual efforts.

Here's how.

Resolve to:

Get your home finances in order. Adjustable rate mortgages are adjusting. Home prices are flat and falling. Review your finances. Look for ways to save money, reduce risks, and lock in long term financial planning.

The AHF says if your mortgage is more than a few years old there's a pretty good chance you can get a lower mortgage interest rate, lower your monthly mortgage payments and, over the long haul, reduce your interest costs. Because most of your mortgage payments in the early years consist of interest, you may also end up with a larger tax deduction.

A recent Harris Poll found that the majority of home owners don't put their equity to work. An equity loan, by nature, is an equity depleting loan, but if you use the cash for necessary capital improvements or investments that provide a decent return (education, business start-up, home improvements, etc.), you can earn back the equity spent, with interest. Professional financing planning can help you visualize the possibilities.

• Stop lending interest-free money to Uncle Sam. He's loaded -- if only on paper. Refunds feel good but only because it's like stuffing cash into the mattress and making it softer. Your tax withholding should be designed, as much as possible, so that come tax return time, you owe the feds nothing and they owe you zip. Otherwise you are simply loaning your money to the government interest free or borrowing it at exorbitantly high rates.

  Get a tax professional to help you set your tax withholding levels to the zero refund/taxes-due level and use your money during the year to pay off high interest rate credit cards, pay some principal on your interest-only or option-payment loan, to pull deferred maintenance on your home or otherwise invest the cash, say, in a retirement fund with employer-matched contributions.

   

• Increase your savings and reduce or eliminate high interest rate credit. Keep the resolutions mentioned above and this one is easy. Shop around for the best interest rates both to consolidate loans and for savings, especially those federally insured Internet banks and other institutions that offer the best rates on both ends.

   

• Review your homeowners and other insurance to maintain adequate coverage, raise deductibles and other wise adjust your coverage to optimal levels -- not too much, not too little.

   

• Save money and the planet by reducing home energy costs. Get a home energy audit to determine where you need to batten the hatches or install new, more energy efficient appliances and materials.

   

• Be a smart home buyer or seller. Virtually every real estate cost (except taxes) is negotiable. Negotiate tough. In softer markets, sell before you buy so you are not left holding the bag. By moving into a short term rental until you find your new home, you'll maintain some leverage on the selling end and be able to concentrate on negotiating when it's time to buy. The strategy can easily offset the cost of a few months of renting.

   

• If you've decided to stay put through the softer real estate market, it's a good time to pump up your home's value with home improvements, energy improvements and even cosmetic improvements. Building material costs have dropped and in some markets refugees from the home building industry are looking for work and are willing to deal. Just make sure you pick a licensed contractor skilled in the work you want performed and not just a down on his or her luck home building laborer.

   

• Get involved in the political process to influence issues including: retaining and increasing the tax benefits of home ownership; new home defects; mortgage fraud; questionable title industry practices; kick-backs; anti-competition practices; global warming that hits home and other issues that affect your bottom line at home.

   

• Resolve to be resolute about these resolutions.
  
  
  Written by Broderick Perkins

Color 2007 Red, Blue, But Not White

The red and blue hues in this year's color forecasts have nothing to do with the color of ink on a growing number of residential real estate investments or the feeling caused by a bleeding bottom line.

They also have nothing to do with the attention to political colors assigned to states depending upon voters' left or right leaning.

Derived from thinking outside the Crayola box, the colors forecast as hot for 2007 are based, not on realty gloom or political partisanship, but on an eclectic blend of environmental reflection and global awareness.

Of course when they are slathered on your walls, dyed into the fabrics of your furnishings and used to accessorize your decor, colors can mean whatever you want them to.

The Consumer Colors Current 2006-2007 Forecast by the Color Marketing Group, the younger of two color forecasting groups, offers, not directives, but directions based on the course colors are likely to take.

Those directions come from input gathered each year at CMG's color collaborative, a conference of color-evaluating workshops for colorists in a host of industries including consumer goods and home and visual communications.

With all the global warming concerns, this year's colors are coming down to Earth, but they are bogged down by convention.

Leaning toward green. The idea of "green" (sustainable materials, energy efficiency, conservation) also means the color green. The current rendition is a softer, more botanical green inspired by nature.

Hot, shimmery blues. A new "aqueous" tone, from that transitional point in the rainbow where blue becomes green, is inspired by the sea. Likewise, yellow-greens offer a coat of eco-savvy and global awareness. More blues from the color of the sky and nature, are often pared with the darkest earthy browns.

New reds. Another new hue, "rubino", is a raspberry red, heavily influenced by the upcoming 2008 Beijing Olympics as well as design from Central America and India.

Natural neutrals. Medium to dark browns, beiges, and tans are more grounded, reflecting the colors of rock, stone and soil.

The older Color Association, forecasting colors since 1915, offers a forecast from a committee panel of eight to twelve industry professionals.

The association gives a more retro perspective with a greater tolerance for color combinations that include multi-colored designs within a room or fabric. Bright combinations include periwinkle blues and saturated purple-browns.

Like Color Marketing, the association sees a landscape of browns, wood tones, but also "honeyed" almost orange browns and golden wheat tones back in vogue. Other browns are more arid, reflecting desert shades rather than chocolate bars.

Along with the influence of Central America and India, the association says to expect influences from Indonesia, India, Thailand and the Philippines and the tones and materials with natural woven textures, rattan and wicker.

Brighter neutrals, those with hues of hickory, cherry, nudes and blush tones are also what the association forecasts. The forecast also calls for cooler greens.


Written by Broderick Perkins