HomeGain’s recent survey shows the top do-it-yourself home improvements that Realtors recommend to home sellers. HomeGain received responses from nearly 1,000 Realtors nationwide and configured a list of the top 12 do-it-yourself (DIY) home improvements that cost under $5,000 and benefit sellers most when they sell their homes. 

According to the HomeGain survey, the top five home improvements that Realtors recommend to home sellers based on cost and return on investment (from highest to lowest ROI) are: 

1. Cleaning and de-cluttering ($200 cost / $1,700 price increase / 872% ROI)
2. Home staging ($300 cost / $1,780 price increase / 586% ROI)
3. Lightening and brightening ($230 cost / $1,300 price increase / 572% ROI)
4. Landscaping ($320 cost / $1,500 price increase / 473% ROI)
5. Repairing plumbing ($385 cost / $1,250 price increase / 327% ROI) 

Cleaning and de-cluttering continues to rank as the top suggested home improvement (since the survey was originally conducted in 2000), recommended by 98% of Realtors, costing less than $200 and returning a value of nearly $1,700 to the home’s sale price, or an 872% return on investment. 

“Many Realtors agree, especially in a buyer’s market, that sellers who make these recommended home improvements often get their homes sold faster and at higher prices,” stated Louis Cammarosano, General Manager at HomeGain. “We have customized our Home Sale Maximizer online home improvement tool to help identify and prioritize the projects that can increase the salability and selling price of a home.” 

Rounding out the top 12, the list of low cost, do-it-yourself home improvements includes: updating electrical, replacing or shampooing carpets, painting interior walls, repairing damaged floors, updating kitchen, painting outside of home, and updating bathroom/s.

The home improvement projects with the highest price increases to a home’s resale value are updating the kitchen ($1,200 cost / $2,850 price increase), followed by painting the outside of the home ($900 cost / $1,815 price increase) and home staging ($300 cost / $1,780 price increase). 

“Inexpensive cosmetic home improvements and basic improvements greatly enhance the value of the home,” stated Carol Wilson of Carpenter Real Estate in Indianapolis, IN, HomeGain AgentEvaluator member since 1999. 

For more information, visit www.homegain.com. 

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RISMEDIA, November 10, 2009—That is one of the most common objections to purchasing real estate where there is a community Association requiring the payment of regular dues and fees. These can range from less than a hundred dollars per month, if for example the only service is streetscaping, to upwards of a couple of thousand dollars for a luxury penthouse. Depending on square footage and amenities, most fees range between $250 and $750. 

Taken out of context, the amount can seem outrageous. But, when considered from a prospective of value received, you can be pretty certain that you are getting one of the last great bargains. 

When evaluating the HOA monthly fee, it is important to consider three things: how was the number arrived at, what does it cover, can anything be done for less? 

1. How is the HOA fee determined? 

In California, and probably most other states, developers must obtain state approvals before their projects can be offered to prospective buyers. Part of the submission process for developments with an Owners Association is the creation of a detailed budget for the operation and maintenance of the common area and the provision of necessary services. 

Developers want to project the most positive scenarios in order to keep HOA dues low and not discourage prospective buyers. And, they are also aware that a $500 per month Association fee equates to another $100,000 that the buyer could have spent for the home. The higher the Association fee, the less the borrower/buyer can spend. 

On the other side, the State wants to establish a realistic budget that will allow for proper funding well into the future. For the consumer, that process of compromising means that the budget is as realistic as it can be at the time it was created. 

The main thing to keep in mind is that the developer will be paying the Association fees on all unsold property within the Association. The developer is not the one benefiting from high fees so there is no reason to blame them. 

2. What does the HOA fee is cover? 

It’s also important to consider what is included. Amenities very widely from project to project; high-rises cost more to operate and maintain than low rise buildings. 

One of the responsibilities associated with real estate ownership is the obligation to maintain and protect the improvements from deterioration, damage, weathering, etc. Living out in the burbs you need a garage full of tools and a lot of weekends to stay ahead of nature. 

Depending on the type of development, there could be a need for a lot of landscape maintenance. That takes labor, and labor is expensive 

If there are common areas such as a lobby, pool, gym, or even hallways, they need to be cleaned regularly, maintained occasionally, painted often, and replaced over time. Garages must be swept and windows washed. 

Then there is liability, property and other forms of insurance, and possibly a security force. 

What utilities are included? Are water, sewer, electric, gas, trash and cable billed individually or are some paid collectively through the Association? 

Then there is usually a management Association looking after things, paying the bills, and communicating all of that to the homeowners. 

3. Can it be done for less? 

Add it all up and you’ll see that the economies of scale allow for a high level of service at a true cost far lower than you could do it yourself. 

And remember, it is your building and your Association. You want to protect your investment and to have the kind of amenities that will allow for profitable reselling in the future. Serve on your Association board. If you can economize, you can lower your HOA fee. 

But, don’t lose sight of the fact that you are paying for important services with a volume discount. It isn’t just an expense; it’s protecting your investment.

George W. Mantor is known as “The Real Estate Professor” for his wealth building formula, Lx2+(U²)xTFP=$? and consumer education efforts. During a career that has spanned more than three decades, he has amassed experience in new home and resale residential real estate, resort marketing, and commercial and investment property. He is currently the founder and president of The Associates Financial Group, a real estate consulting firm.

Mantor can be reached at GWMantor@aol.com.

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Year-over-year home values in the United States declined for the 11th consecutive quarter, falling 6.9% to a Zillow Home Value Index of $190,400. However, the rate of year-over-year decline shrank for the third quarter in a row, meaning home values did not decline as dramatically year-over-year in the third quarter as they did in the second or the first. 

In addition, the Zillow Home Value Index remained relatively flat in the short term, declining 0.4% from the end of the second quarter to the end of the third quarter. The Zillow Home Value Index measures the value of all homes in an area, and the Q3 Zillow Real Estate Market Reports encompass 156 metropolitan statistical areas (MSAs). 

Foreclosure re-sales remained high, making up more than one-fifth (21.4%) of all U.S. home sales in September, and made up the majority of sales in several MSAs including the Merced, Calif. MSA (74.2%), the Stockton, Calif. MSA (69.3%), the Madera, Calif. MSA (68.7%), the El Centro, Calif. MSA (68.1%) and the Las Vegas MSA (67.5%). Additionally, 26.9% of home sales nationwide sold for less than what the seller originally paid. 

“The decline in the percentage of homeowners with negative equity is a positive sign, and is directly attributable to the stabilization of home values from the second quarter to the third,” said Zillow Chief Economist Stan Humphries. “It is also attributable to many homeowners who were previously underwater on their mortgage losing their homes to foreclosure. 

“The next several months will be critical to the housing market. Previously, we’d been expecting to see increasing foreclosure rates during the real estate market’s slow winter season, a confluence of events that would likely drive inventory up and prices down. But now, with the extension of the $8,000 first-time homebuyer tax credit and a new $6,500 credit for some repeat homebuyers, we could see a bump in demand that could partially offset the increased supply of foreclosed homes on the market. The credits are likely to bring continued stabilization in prices over this period, versus the price declines that we almost certainly would see otherwise. Whether this stabilization will be sustainable after the tax credits expire, however, is yet to be seen. Some of the demand that we are buying with tax credits we are also borrowing from the future, and will likely have to pay for later in the form of weaker-than-normal demand.” 

Some markets across the country showed encouraging signs in the third quarter. Home values increased year-over-year in 24 of 156 MSAs and remained flat in an additional 16. Only nine MSAs – including the Merced, Calif., State College, Penn., and Salisbury, Md. MSAs – showed increasing year-over-year declines. 

The Milwaukee and Boston metropolitan statistical areas were the largest markets to show positive year-over-year changes in home values, with the Zillow Home Value Index rising 2.6% in Milwaukee and 1.6% in Boston. 

For more information, visit www.Zillow.com. 

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-Stage it virtually. This option is aimed at empty homes, because photos of bare walls and floors can make online shoppers lose interest. You just snap photos of the empty rooms and send them to a virtual stager, who uses computer imagery to “furnish” them. The photos can be posted online or used in marketing materials. Prices range from around $200 for three rooms to $325 for five rooms, although rates vary by city.

-Pay for a plan, but provide the muscle. Many stagers will work as consultants, touring your house and offering suggestions on presenting it. Barb Schwarz, founder of the International Association of Home Staging Professionals, says the average fee for a consultation is $350. Then it’s up to you to do the cleaning, decluttering and rearranging. Kiplinger’s suggests renting a portable storage unit if you have a lot of stuff to store. One company, PODS, will deliver the unit to your driveway for $75, transport it to a secure storage facility for another $75 and charge you a monthly storage fee of around $150, depending on where you live, the time of year and other factors.

-Add some pizzazz. Sometimes a few decorative extras can update or neutralize a home’s decor. You may be able to negotiate with a staging company for decor items such as wall art, area rugs, lamps or other accessories.

-Focus on a few rooms. Hire a stager to redo just the entryway, main living area, kitchen or master bedroom. Stagers usually charge $75 to $125 an hour. Ignore secondary rooms, or do them yourself once you’ve seen how the pro works. 

(c) 2009, Akron Beacon Journal (Akron, Ohio).

Distributed by McClatchy-Tribune Information Services.

The homebuyer tax credit, due to expire at the end of November would be extended through April 30 of next year. First-time buyers who are in the process of making a purchase would not need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline. 

For the first time, the legislation that was recently cleared makes move-up buyers as well as first-time buyers eligible for a credit. The $8,000 maximum first-timer credit will continue and will now be available to couples with income up to $225,000, a nearly $55,000 increase above the level in existing law. A new $6,500 maximum credit would also be available to move-up homeowners who have lived in their current residence for five of the prior eight years. 

For homebuyers across the country, the expanded tax credit would allow more people to qualify for the credit. While two-thirds of American families own their own home, and most earn less than the income limits that have been established within the extension, more buyers may be eligible. Move-up buyers don’t have to sell their current home to qualify for the new credit, but the money cannot be used to buy a vacation home. “It’s only for a primary residence,” said Regan Lachapelle, a spokeswoman for Sen. Harry Redi (D-Nev.), who helped engineer the deal. “In expanding the tax credit, we are helping first-time home buyers, as well as homeowners looking to move up to a new home, but we would exclude from the credit speculators who may have recently purchased a home intending to flip it for a fast profit,” said Senator Max Baucus, Democrat of Montana and chairman of the Finance Committee. 

The tax credit has fired-up the housing market, driving existing home sales to the highest level in over two years. The National Association Realtors reported sales jumped 9.4% to a seasonally adjusted annual rate of 5.57 million units in September and are 9.2% higher than the 5.10 million-unit pace in September 2008. 

The legislation included provisions added to address complaints of fraud as well. The Internal Revenue Service is given greater authority to oversee the process to root out fraud, and provisions are added in response to past abuses of false sales or underage buyers. An investigation by the Treasury Department’s Inspector General for Tax Administration found that more than 580 children, some as young as four years old, had received $627,000 in first-time homebuyer credits. The IRS has identified 167 suspected criminal schemes and opened nearly 107,000 examinations of potential civil violations of the first-time homebuyer tax credit.

For more information, visit www.realestateeconomywatch.com and www.wsj.com. 

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com. 

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In a recent interview, Fox-Pitt Kelton analyst Robert Stevenson said the Senate’s proposal for extending the $8,000 tax credit for new homebuyers will have a “limited impact” on home sales.

A Senate committee reached a deal last week to extend the $8,000 tax credit and offer a smaller $6,500 credit for some existing homeowners. The main pitfall of the proposal is that it only pushes back the expiration of the tax credit to the end of April, Stevenson said. It is currently set to go away on Dec. 1. Stevenson said he’s skeptical the tax credit will drive activity during the slower winter months. The prime selling season for the housing market kicks off in the spring and tends to run through the warmer months. “Of course, Congress could come back and extend it again,” the analyst said. “When the next selling season starts, the housing market will depend on the state of the economy and mortgage rates, rather than tax credits.” 

The $6,500 credit for some repeat homebuyers would let more buyers participate albeit at a lower level, “but a lot of those people are effectively trapped in their current homes,” Stevenson said. 

From their peak in 2006, U.S. home prices have fallen about 30% through the end of August 2009 during the housing downturn, according to the S&P/Case-Shiller home price index. More Americans are falling behind on their mortgage payments or losing their homes in the recession as job losses pile up. Rising foreclosures are another key worry. Yet hopes that a recovery is in place were fueled by a report showing the fourth straight month of rising home prices. Some attributed the tentative rebound to buyers rushing to cash in on the expiring $8,000 tax credit. The push to extend and expand the credit has been led by home builders, Realtors and other groups connected to the housing market. 

“Failure to act now could derail the fragile housing recovery even before it has time to take root,” said Jerry Howard, president of the National Association of Home Builders, in a statement urging Congress to stretch the tax credit. “The consequences would be devastating for both housing and the economy.” Howard said the tax credit has already helped create nearly 200,000 jobs, drive home sales, stem foreclosures and stabilize prices. Homebuilder stocks were up sharply in the wake of the news on the Senate compromise. Still, some economists say the incentive’s impact is overblown. 

“I am not applying the recent home-price rebound to the tax credit,” said Cameron Findlay, chief economist at LendingTree, in a recent interview. “I don’t think the tax credit makes as big an impact as people make it out to be, although it certainly motivates first-time buyers,” he said. “If it expires, I don’t think it would shake the housing market as much as some have predicted.” 

The compromise on extending the tax credit doesn’t mean it’s a sure thing, and the proposal still face votes in Congress. One potential snag is a recent government report that uncovered fraud and abuse associated with the tax credit. Thousands of ineligible taxpayers have received millions of dollars under the program, according to the report. 

Stephen East, an analyst at Pali Research, said the proposed new $6,500 credit would likely have some impact on the lower-end of the move-up market. “In essence, this could slowly start to prime the pump,” East forecast. “That said, we remain wary that any measurable impact will be seen until after the holidays and investors need to reconcile their expectations to that.” 

(c) 2009, MarketWatch.com Inc.

Distributed by McClatchy-Tribune Information Services. 

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The survey, the fifth annual Energy Pulse® survey conducted by Shelton Group, found that consumers are reverting to their old priorities as the recession wanes- perhaps at the expense of the environment. 

“Energy efficiency is back to playing second fiddle, competing with more visible and exciting home improvement projects,” said Suzanne Shelton, whose firm conducted the study. “Anyone selling energy-efficient products must either focus heavily on the aesthetic or comfort aspects of their products or play up their environmental benefits in a big way.” 

The survey, which polled 504 Americans by telephone in September 2009, asked consumers: “Assuming you were suddenly given $10,000 to make home improvements, which two of the following would you choose?” The top answers were: 

-Refinish the kitchen or bathroom (37%)
-Replace carpet or add hardwood or tile (33%)
-Replace windows (31%)
-Replace HVAC/furnace (23%)

Last year’s top answers were:
-Replace windows (35%)
-Replace HVAC/furnace (27%)
-Remodel kitchen or bathroom (26%)
-Replace carpet or add hardwood or tile (25%) 

Among the survey’s other findings:
-Consumers are willing to watch their energy bills go up more than 70%, on average, before feeling forced to make energy-efficient home improvements. Respondents said their bills would need to go up an average of $129 a month to make them undertake renovations. “We call this phenomenon the ‘Apathy Gap,’ the price people are willing to pay to do nothing,” Shelton said. “Here consumers are willing to waste more than $1,500 a year, or more than $4 a day, before they’ll take action. For that same amount, a homeowner could install insulation or purchase one or two new ENERGY STAR® appliances to start seeing immediate savings.” 

-There is a lot of pent-up demand for solar power. The survey asked, “How likely would you be to buy a solar electricity system for your home, knowing that a mid-size system that would provide around 63% of the average household’s electricity, costs $35,000 to $40,000 that could be offset by a $2,000 federal tax incentive along with additional rebates in many states.” 

Twenty-eight percent said they would be likely or very likely to buy such a system. Fewer than 1% reported they already had such a system. “This indicates an enormous potential market for solar,” Shelton said. “Consumers have been waiting for solar to become more accessible and more affordable. Now, with prices projected to fall even further, and with new federal tax incentives greater than they’ve ever been – up to 30% of the cost of the system for qualifying taxpayers- solar power will be on the rise.” 

-Consumers have good intentions – but not very good follow-through. Surveys over the past five years, including this year, show consistently large discrepancies between intentions and actions. Every year, for example, around 20% or more consumers say they’re planning to get an energy audit, yet the percentage of U.S. homeowners who’ve actually gotten one has languished in the 10-15% range. 

“That’s why we now refer to home energy audits as the ‘colonoscopy’ of energy efficiency,” Shelton said. “Everyone knows they should get one, but too few actually do.” 

For more information, visit www.sheltongroupinc.com. 

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“I just love her,” Gordon said. The two women—and their two dogs—bonded quickly after Thalacker moved in last December. Both have busy independent lives, but they still find time to share one or two meals a week, plus occasional bike rides, wine, ice cream and sometimes “American Idol.” 

Their living arrangement is short-term. “When she finishes her practicum she’ll look for a job. I don’t know where she’ll find one,” Gordon said. “But I might keep her forever,” she added with a laugh. 

Roommates as compatible as Gordon and Thalacker are rare, but their circumstances are increasingly common. Last year’s stock-market crash and recession, which wiped out jobs and slashed incomes, have prompted many to look for new sources of revenue. For homeowners, that can mean turning a spare bedroom into a cash cow. 

Roommate postings on Craigslist have increased 160% nationwide over the past 24 months, and 80% in the Minneapolis area over the same period, according to spokeswoman Susan MacTavish Best. There’s no way to track how many of today’s new roommates were brought together by economic forces, said Marilyn Bruin, associate professor in the University of Minnesota’s housing studies program. “I haven’t seen any data, but I totally believe it’s an economic strategy. It makes sense.” 

The trend mirrors what happened during and after the last economic meltdown, the Great Depression. “Housing was scarce, and renting of homes was not all that uncommon,” said Clifford Clark, a professor of history and American studies at Carleton College in Northfield, Minn. “My grandmother took in boarders.” 

Gordon, who has lived in her Scandia, Minn., home for 28 years, never would have anticipated adding a roommate at this stage of her life. But fate threw her some curveballs. Several years ago, her husband, a physician, developed a serious illness, so Gordon left her job as a food stylist to care for him. Three years ago, he died. Then, “the economy tanked. I saw my savings disappear.” She had forged a new career as a newspaper columnist and cookbook author, but she wanted to boost her income. “I’m 55 now—it’s not so easy to get a job. I thought, ‘OK, what have I got that I can make work for me?’” One thing she had was a master suite she was no longer using. After her husband’s death, Gordon started sleeping in a loft bedroom “closer to the core of the house,” she said. So she sought a roommate via Craigslist. 

The first person who responded was a scam artist. The second had eight dogs. The third was Thalacker. “I was new to Minnesota, from a really small town,” said Thalacker. “People said, ‘What do you mean, you’re going to live with some lady you met on the Internet?’” When Thalacker came to meet Gordon and see the house, she felt at home immediately. “She was cooking, the dogs were going crazy, it was kind of chaotic, and I thought, ‘This is perfect.’” 

(c) 2009, Star Tribune (Minneapolis)

Distributed by McClatchy-Tribune Information Services. 

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For finding out how much your mortgage is going to cost you, a loan mortgage calculator often works as a user-friendly tool. Nevertheless, this tool can’t save you all the time. Similar to other forms of investment, real estate mortgage loans are also subject to scams. Mortgage frauds and scams can make you lose thousands of dollars on interest as a minimum because of excessive fees and other hidden costs. The worst that can happen is that you can lose your home to foreclosure. 

According to industry professionals, there are three principal or familiar types of real estate fraud: 

1. Identity theft via mortgage request
2. Bait and switch
3. Loan flipping 

For preventing scams, it has been witnessed that offense is the best defense. Understand the truth and don’t hesitate to make queries. 

Bait and switch is a fraudulent sales technique where a loan product is publicized at a lucrative rate (bait). However, the product or rate is subsequently changed for the gain of the lender (switch). This is an utterly illegitimate and deceitful practice. For instance, one interest rate is assured at the time of selling a loan, but a bigger rate is provided at the time of closing. 

When you’re obtaining a pre-approval or mortgage quote, you believe that your question with the lender is secret, right? You’re wrong. On many occasions, important financial details about you and your mortgage requirements are hacked by vying lenders. This can happen within 24 hours of your credit bureau inquiry. Your loan officer is even unaware of this. Many firms provide countrywide accessibility to your financial details to the lenders and everybody in your city who requested for a mortgage within the last 24 hours. Any other lender can talk to these individuals the following day and give them a pre-approval for an improved mortgage loan. 

One more dilemma is mortgage solicitation through telephone, the Internet or door to door. These scams involve filling in an application through fax, the Internet or over the telephone and often the rates are phony. However, it is not the largest issue to be bothered about–it is nothing but identity theft. Even though the rates are legitimate, the company would get all your important details such as your social security number that can result in mortgage scam or identity theft. 

Another type of mortgage scam that is prevalent in the real estate industry is loan flipping. Loan flipping denotes frequent refinancing of a mortgage within a small time frame with very small gains to the borrower. It takes place when a borrower can’t keep up with the planned payments or constantly combines other unsecured loans into a new secured loan at the request of a lender. Lenders flipping loans ask for too much origination fee with every consecutive refinancing. They might ask for these fees on the basis of the whole loan amount, not only on the increased amount summed up with the loan principal through refinancing. In addition, every refinancing might attract prepayment penalties that can be funded as a portion of the overall loan amount, accumulating the debt of the borrower. 

If you’re buying a home, looking for a home equity loan or considering a mortgage refinance, it is better to work with a trustworthy lender. You must shop around and do some homework to get the best offers. Try to stay away from furnishing any details until you’re confident that the company or individual you’re talking to is right for you. 

For more information, visit www.mortgagefit.com. 

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While its passage remains uncertain, the agreement would extend the existing credit for first-time homebuyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners, Senate aides said. The reduced credit would be available to all homebuyers who have been in their current residence for a consecutive five-year period in the past eight years. Lawmakers in Washington also raised the qualifying income limits to $125,000 for single taxpayers and $250,000 for joint taxpayers, from the current $75,000 and $150,000, housing-industry sources said. Under the Senate compromise, buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement, said the sources. The measure still faces votes in the full Senate and the House. 

Treasury Secretary Tim Geithner and HUD Secretary Shaun Donovan are in full support of the Senate’s proposal to both extend and expand the first-time homebuyer tax credit and called on Congress to approve key housing measures that include the tax credit. “We welcome efforts taken by Congress to extend the First-Time Homebuyer Tax Credit for a limited period. This credit has brought new families into the housing market and contributed to three consecutive months of rising home prices nationwide,” said Secretaries Geithner and Donovan. “In extending the credit, we urge Congress to include strict measures to combat tax fraud and protect responsible homeowners.” 

The current tax credit did little for the new-home market in September, the Commerce Department recently reported—news that took many industry analysts by surprise. Sales fell 3.6% from August and 7.8% from September 2008. Industry observers had expected a fifth consecutive monthly increase in new-home sales, believing that the tax incentive for qualified first-time buyers—credited with 357,000 sales of previously owned homes so far this year—would do the trick. Instead, sales of typically more expensive newly built houses slipped. “The decline in new-home sales seems to us to be more a function of the attractive pricing available on resales in the current environment than a reflection of weakening demand,” said Michael Feder, president of Radar Logic in New York, which tracks the market. 

“Since hitting rock bottom in March, demand is up 20 percent,” said Joel L. Naroff of Naroff Economic Advisers in Holland, Pa. For Naroff, the robust rise in existing-home purchases—9.2% year over year in September—indicated that the housing market was not faltering. “Maybe the issue is supply, which fell to its lowest level in 27 years,” he said. “Builders, at least those left standing, have been making sure they don’t have any houses sitting around, and they have been very successful in controlling inventories.” 

IHS Global Insight economist Patrick Newport echoed that, noting new-home inventories “sank for the 29th straight month to their lowest level since November 1982.” Naroff maintained housing has recovered enough to stand without the tax credit, but Newport said that if the credit were not extended and expanded, housing demand would take a hit, and home sales would drop. 

The new provisions are aimed at broadening availability of the credit beyond first-time buyers and giving the weakened real estate market a bigger boost while preventing real estate investors from benefitting. While Senate lawmakers appear to have reached a deal on the substance of the tax credit, they are still at odds over how it would be brought to the Senate floor. 

(c) 2009, The Philadelphia Inquirer.

Distributed by McClatchy-Tribune Information Services. 

For more information, visit www.wsj.com. 

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In the course of my adult life, I’ve lived in 14 different residences, six of which have been single-family homes that I bought. Like most people, each time I had my list of must-haves in terms of living space, floor plan flow, structure, amenities, etc. But as I was also new to the area for half of those decisions, I was also interested in knowing more about the neighborhood and surrounding environment and would always envision myself coming home after dark. Even the most charming tree-lined street takes on a different character when the sun goes down. 

Home as a sanctuary has moved from cultural trend to the essence of what makes a house a home. The term “sanctuary” covers everything from the basic need of shelter, a place of refuge, security, as well as a home that fits the lifestyle of the family living there. Gone are the days when showing a house with a home security system or solid deadbolts might signal the buyer to think the neighborhood was unsafe. Today, a home properly equipped to address general security issues is expected and has become the norm. Making a home more secure doesn’t have to be expensive or time consuming. 

Here are some options for sellers to consider: 

1. Hedging your bet-Trimming the bushes at the front entry and near the windows of the home adds curb appeal and opens sight lines around entrances.
2. Security with style- Choose attractive storm doors and entry doors with more secure locking options.
3. Light it up- Motion-activated lighting, timer controls and dusk-to-dawn options paired with path lighting and landscape lighting means the curb appeal of the home doesn’t go down with the sun.
4. High-tech peace of mind-Easy-to-install, whole-home wireless security systems and monitoring means you can control locks, lights and cameras from a computer or cell phone. 

A buyer in the market for a new home today has more options than ever, and each has his or her own list of must-haves. Leverage the opportunity to show a home’s strength by marrying curb appeal and charm with a few upgrades that deliver on peace of mind.

Melissa Birdsong is vice president for Trend, Design & Brand, Lowe’s Companies, Inc. 

For more information, please visit www.lowes.com. 

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com. 

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Over that time period, the number of seniors using the company’s online calculator has increased nearly 90% from the previous quarter. This significant increase in older homeowners researching a reverse mortgage mirrors the growth in reverse mortgages overall.

This increase is also likely driven by conditions in the marketplace that are reducing the amount of money seniors can gain through a reverse mortgage. Many then are seeking relief now to maximize their equity. These factors include new HUD (U.S. Department of Housing and Urban Development) regulations that slashed reverse mortgage proceeds by 10%, a continued decline in self-reported home values and federal legislation whose expiration at the end of this year will significantly reduce reverse mortgage limits even further.

“Older Americans continue to feel the lingering effects of the recession more than other segments of the population and a growing number of them are actively looking for ways to generate additional cash in retirement,” said Eric Bachman, founder and CEO of Golden Gateway Financial. “Unfortunately, these individuals stand to lose even more leverage and equity in their own homes when the temporary increase on mortgage limits expires at the end of this year. Seniors need this higher limit renewed as another tool that can help them find their financial footing.”

Recent HUD regulation changes resulted in an across-the-board 10% reduction in reverse mortgage proceeds available to seniors. At the same time, seniors are reporting a growing decline in their estimated home value. While the latest S&P/Case-Shiller Home Price Indices highlights a slowing drop in home values across the country, seniors seem to be gaining momentum. The decline in senior home values was reported at 1.4% between the first and second quarters of this year, but it dropped steeply to nearly 10%, or an average loss of almost $40,000 between the second and third quarters of 2009.

This is troubling for seniors because the amount of money available through a reverse mortgage is directly tied to the value of their home and the equity they hold in it. Further compounding this reduction in available equity is temporary legislation that increased reverse mortgage limits to $625,500. When this expires at the end of 2009, limits will fall back to $417,000, further reducing the amount of reverse mortgage proceeds available to borrowers.

Additional observations from the data include:

-The average age of users remained roughly consistent
-Self-reported senior home values dropped nearly 10% by almost $40,000 between the second and third quarters of 2009
-The median reported home value dropped below $300,000 for the first time in more than a year
-The average existing mortgage debt fell by approximately $8,000 from the previous quarter

Reverse Mortgage Calculator National Averages

Q1 ‘09       Q2 ‘09        Q3 ‘09

Average age                                     69.5            69.3            69.4
Average home value                     $413,371   $407,557   $369,762
Median home value                      $300,00   $300,000  $270,000
Percent with existing mortgage 49.9%        49.8%          51.3%
Average existing mortgage debt $161,265 $152,455 $144,497
Average max up-front payment $143,872 $151,089 $136,711
Average max monthly payment $922           $1097      $993

For more information, visit www.goldengateway.com.

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For more real estate related headlines on RISMedia.com, be sure to see:
Bernanke: Recession is Over, but Tough Times Will Linger
Home Price Reduction Levels Rise for Fourth Straight Month

The stimulus plan lowered federal income tax withholding rates, which results in more take-home pay but less money going toward taxes. The downside is some taxpayers may end up with not enough taxes being withheld to cover what they owe in 2009.

As a result, some taxpayers may need to increase their withholding amount by reducing the number of allowances claimed for the rest of year, which means making changes to a W-4 form available from an employer’s human resources department. Single taxpayers who are working at more than one job and married couples filing jointly in a situation where both spouses work are the most likely groups of taxpayers to be caught short. “They are probably going to find out they are either getting a lot less back or they might owe,” said Mark Steber, chief tax officer at Jackson Hewitt Tax Service, a tax preparation firm.

Others that could face this scenario are those who can be claimed as a dependent on someone else’s tax return (for example, a working student claimed as a dependent on a parent’s tax return) and some Social Security recipients who work. Most people who received the credit have seen their paychecks grow by $15 to $20 per pay period since April as a result of employers taking out less withholding, said Steber.

The Making Work Pay credit is equal to 6.2% of earned income, whether it be from job wages or self-employment. It applies to 2009 and 2010. For the individual taxpayer, the credit is worth up to $400 a year and for married couples filing joint returns, it’s worth up to $800. The credit is phased out for individuals with adjusted gross incomes between $75,000 and $95,000 and for married couples with adjusted gross incomes between $150,000 and $190,000. “I don’t think many people realize that because of the credit they may not have the correct withholding and could owe at tax time,” said Kelly Batson, a director of the Earn It! Keep It! Save It!, a tax assistance program for low-income taxpayers. “They need to check their withholding now.”

For single taxpayers, the American Payroll Association estimates the credit will generally reduce withholding by $400 a year. A single taxpayer with two jobs would actually receive the credit twice even though he or she is only entitled to receive it once, according to Steber. For married couples filing jointly, the credit will generally decrease total withholding by $600 a year, said the Payroll Association. That means if both spouses work, their combined withholding would be reduced by $1,200 (2 x $600), even though their maximum credit would be $800, which means they could end up owing $400 in taxes or be short that amount in a refund. “If you are a married couple with two incomes, you may be getting too much of the credit,” Steber said. “The withholding tables don’t know the other spouse is working.”

Conversely, a married couple filing jointly with one working spouse will have $600 less in withholding but would be entitled to an $800 credit, which would result in an additional $200. People who are already working and take on a holiday job should consider being more aggressive when choosing a withholding amount for the holiday job, Steber said. “For many workers that means selecting the single status with zero dependents when completing form W-4,” he said. “Completing a W-4 in this way will cause a slightly higher amount to be withheld, which may help offset the duplicate Making Work Pay credit that the worker receives.”

Tax Bite?

Here is an example where a single taxpayer with two jobs could end up with a smaller refund or even owe taxes as a result of a provision of the Obama stimulus plan.

Assume a single taxpayer who claims single filing and single withholding status with zero allowances for withholdings earned $35,000 last year working two jobs. He earned $10,000 in one job and $25,000 in the other job. The total withholdings under the old withholding rates would be $3,700; the total under the new tables is $2,969. Because the total reduction in withholdings is $731 and the Making Work Pay Credit is $400, this leaves the taxpayer with a shortfall of $331.

Source: Jackson Hewitt Tax Service

(c) 2009, Contra Costa Times (Walnut Creek, Calif.).

Distributed by McClatchy-Tribune Information Services.

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“Despite the losses that many families suffered in the mortgage crisis, there remains high interest in homeownership among those families that stayed on the sidelines and didn’t buy during the boom,” says Tino Diaz, chairman of NAHREP. “Our members report that the appeal of stability and personal freedoms that come with homeownership are top motivators.”

A survey of 500 NAHREP members including opinions from real estate agents and mortgage professionals revealed the following:

-Seventy-six percent of respondents said that stability of family ranked first or second as the primary reason why clients want to buy a home. Thirty percent said utility and the freedom to create a home that suited their personal or cultural style was the top one and two reasons why their clients want to purchase a home;

-Only 18% of practitioners polled viewed financial investment as the primary reason for buying a home;

-Fifty percent of members that answered the poll said that wasting money on rent ranked first or second as the primary motivation for their clients to become homeowners;

-Forty-nine percent of members said that tighter lending standards remain the biggest barrier to homeownership for their clients; while 44% ranked first or second the competition from cash investors as the main obstacle to homeownership of their buyers. Thirty percent of respondents ranked lack of down payment as one of the top two challenges for their buyers.

-Sixty-three percent of members polled say they have six or more mortgage-ready clients that are ready to buy a home;

-Fifty-one percent of those surveyed said that today’s buyers are more sensitive to purchase price and mortgage payment, more apt to want house payments that include taxes and insurance and prefer a 30-year fixed-rate loan;

-Sixty-five percent of Hispanic real estate professionals that participated in the poll said that some form of consumer education would be most useful to enabling Latinos to achieve homeownership

Nearly half of the nation’s 14 million Hispanic households currently rent. If half of the renter pool follows through and is able to achieve homeownership during the next five years as they plan, the nation’s fastest growing minority group could be the next big wave of first-time buyers. Based on the median home price of $174,900, this could create more than $600 billion in home sales over the next five years, the Hispanic trade association estimates.

“An infusion of new homeowners that want to stay put and build nests for their families is exactly what the housing market needs,” said Craig Nickerson, project director for the National Community Stabilization Trust, an organization that assists local communities to acquire, rehab and sell foreclosures back to homeowners. “Once the pendulum swings back to the middle, a whole new group of buyers will be ready to buy homes. This is promising news especially for foreclosure-ravaged communities.”

For more information, visit www.nahrep.org.

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For more real estate related headlines on RISMedia.com, be sure to see:

• Taking Advantage of Negotiation – U.S. Homebuyers Paid $7,039 Less Than Listing Price in July
• First-Time Buyers Race to Beat the Clock, Qualify for $8,000 Federal Tax Credit

In another article about the possible first-time home buyer tax credit fraud, reporter Dawn Kopecki reports that children as young as four years old have improperly received the first-time home buyer tax credit. And, according to the Treasury’s J. Russel George, who testified before Congress recently: “They [IRS] also found that 580 taxpayers under 18 years old and therefore ineligible to buy a home claimed almost $4 million in tax credits.” 

The first-time home buyer tax credit ends Nov. 30, 2009. Here are a few resources on Zillow.com that may help you if you are still trying to use the credit and want to learn more: 

$8,000 First-time Home Buyer Tax Credit Ends Soon–Better Get Moving!
New Widget: Do You Qualify for the $8,000 First-time Home Buyer Tax Credit?
Rules and Forms in Place for $8,000 First-time Home Buyer Tax Credit 

For more information, visit www.zillow.com. 

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The book contains invaluable, often neglected facts and information based on Mungar’s vast experience, his extensive research and interviews with insiders revealing the secrets of how to get lender approvals. According to the author, with the help of this guidebook, most homeowners will be able to resolve their problems and save time, money and possibly their homes. 

The Homeowner Survival Guide explains all the programs and options, together with step-by step instructions to help troubled homeowners get what they need quickly and at minimal cost. 

“Contrary to what people are led to believe, I see millions of homeowners still needing help who are being pushed around and not getting what they need,” says Mungar. “The programs implemented by the government and lenders are supposed to help over three million eligible homeowners who are behind in their mortgage payments, yet only about 300,000 homeowners got their loan payment reduced so far. The media and the government are reporting as if the economy has already recovered while ignoring the fact that loan defaults and unemployment continue to rise in many areas. We all need to wake up and dedicate our efforts to help those millions of people who still need help.” 

The Homeowner Survival Guide discusses timely and important issues such as:
-Loan Modifications – How to prepare a package that will get lenders to approve
-All the options available to help troubled homeowners survive the hard times
-Easy to understand analysis of the current housing market and housing bubble and how lenders operate
-How scam artists work and how to avoid them
-Forecasts on unemployment, the recession, recovery, home values 

“To the best of my knowledge, there is no book available that will connect all these dots, reveal secrets of the lenders and teach homeowners how to prepare the forms and budget that will meet lender requirements,” adds Mungar. “My book combines and coordinates what’s available from the government, the lenders and HUD counseling centers. I’ve added far more details not available to the public and teach homeowners how to reduce their payments and stop more foreclosures. If my book is distributed to all those homeowners needing help, it will save far more homes from foreclosure and at a much faster pace and virtually no cost.” 

“Aside from the teaching, it contains some interesting chapters that explain what caused the financial crisis and housing bubble, how soon home values will recover and how scam artists work and how to avoid them,” concludes Mungar. 

About the author
Andrew C. Mungar, a well-respected real estate expert in Texas, has provided consulting services to developers, lenders, homeowners, investors and government agencies for nearly 30 years. He has received numerous accolades and some of the highest industry awards. 

For more information, visit www.homeownersurvivalguide.net 

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The very idea of one’s property being seized is anathema to the American psyche and is not taken lightly by either the government or the citizen(s) involved in a possible seizure. In this exclusive interview, Bird discusses the truth about eminent domain. Is it common, uncommon, easy, difficult, etc.? 

MBS: Robert, what, if anything, has changed relative to eminent domain regulations since the Kelo case (Kelo v. City of New London), the last highly-publicized Supreme Court case? 

RB: The Kelo case, while widely publicized, did not substantively change the law of eminent domain. Perhaps the best service that Kelo provided was that it informed the public of the broad range of an already existing power. After the Kelo case, legislation was introduced in a variety of states and at the federal level to curb the reach of municipalities arising from eminent domain. While some states did pass legislation ‘pruning’ the power of government entities to seize private land, many bills fizzled and never became law. The result today is that, while some states have adopted checks to prevent the worst excesses in eminent domain, Kelo is still stated law at the federal level and in most states. 

MBS: What do agents and brokers need to know to perform their duties effectively if and when they are involved in a possible eminent domain case, keeping in mind that finding the proper counsel is crucial?

RB: Agents and brokers need to know that eminent domain is a constant presence in real estate practice. Government entities have great discretion in choosing what properties may be seized via eminent domain and what can be done with those properties once they fall under government control. That being said, eminent domain is the exception rather than the norm for government practice. Agents and brokers should be aware, however, that certain kinds of properties are vulnerable to eminent domain. Such properties include those affected by neighborhood blight, in the logical path of natural extensions of transportation corridors or locations that municipalities have been examining as targets for economic redevelopment. Even with these vulnerabilities, agents and brokers can be assured that the likelihood of a given parcel being subject to eminent domain action is rare. 

MBS: What can/should an agent/broker advise a client/prospect to do who may be involved in an eminent domain issue?

RB: The most important advice to the client/prospect is to retain counsel immediately. Clients/prospects would be wise to obtain an attorney who specializes or has had extensive experience with eminent domain cases and is familiar with its procedural and substantive laws. Clients/prospects should also be made aware that they can challenge not only the taking itself but the appropriate price of the property to be paid to the landowner if it is seized. People should not go it alone when facing the threat of eminent domain. The expense of hiring an attorney will be well worth it in most cases. 

MBS: When a person is faced with challenging an eminent domain seizure, what are the chances that they will win and not have the property seized?

RB: The truth is that if the municipality wants the property, they will most likely get it every time. However, most appeals brought by owners are based not on contesting the seizure, but rather on the so-called fair market value estimate being tendered. The first appeal would most often be to the local zoning board. If there is no acceptable resolution, then the case could be brought to the state Supreme Court or U.S. Supreme Court as happened in the Kelo case. The issue of fair market value is a tough one in that there are many variables used in determining the dollar offer: construction replacement costs; market sales approach; future use considerations; etc. People are often afraid to contest the estimate of value and take the first offer tendered. They fear that generating a court case would weaken their position, and instead of gaining greater remuneration, they will be forced to settle for less. Having the right legal advice provides the owner with the advantage of having someone who knows the right questions to ask the first time. 

MBS: While the incidence of eminent domain may be rare, when it does manifest itself, it inevitably becomes a front-page issue in the community affected. 

Marylyn B. Schwartz, CSP, is an expert in real estate and corporate sales training/management and team development. She is president of Teamweavers and a trainer for Leader’s Choice. To contact her, e-mail teamweaver@aol.com. 

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com. 

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If you get the answers to those questions right, you’ve pretty much got retirement right, according to Rappaport, a former president of the Society of Actuaries as well a president of a Chicago consulting firm bearing her name. 

Now, there’s plenty of information about the first two questions but not so much about the third. And that’s the one that people really need to get right now, especially given the findings of the SOA’s recent work on the subject. Here’s a snapshot of what Rappaport and her colleagues found: 

What should you do with the equity in your home?
The equity in your home represents a big part of your wealth. If you’re married, your non-financial assets—mostly the equity in your house—represent about 70% of your total assets, according to a 2009 Society of Actuaries report titled “Segmenting the Middle Market: Retirement Risks and Solutions.” What’s more, the report noted the median value of financial assets is less than 1.5 times median income—$75,000—for the majority of middle-class households and that the median value of financial assets is just three times the median income—$132,000—for the vast majority of affluent households. 

There are caveats in the 70% figure, though. The SOA report excluded the value of Social Security and traditional pension plan benefits, which if included would reduce the percent home equity represents to total assets. And the percent is based on analysis of the 2004 Survey of Consumer Finances. Things have certainly changed since then. 

Still, the number is relevant because the equity in your home—downturn or not—is still “a very significant retirement asset and options related to choice and financing of housing are important considerations for retirement planning,” according to “Overview of Housing Wealth, Options, and Spending Issues in Retirement,” a just-released SOA paper co-authored by Rappaport. Rappaport said that housing costs currently represent about 35% of a pre-retiree’s budget. And that means housing equity, as a percent of total assets, is perhaps more than twice what it should be.

Software fails to consider housing wealth
But even though the equity in your home is a big deal, the SOA’s study finds that much is lacking when it comes to helping average Americans figure out what role housing wealth should play in financing retirement. “Although housing wealth was extremely important to middle class Americans, it did not seem to represent a primary consideration as they engaged in retirement planning,” Rappaport wrote. “In fact, many planning tools do not consider it explicitly, leaving a hole in advice that could be provided to middle income Americans.” 

Indeed, most retirement planning software programs don’t consider housing wealth, and of the few that do, it’s apparent that there’s no agreed-upon standard for doing so. Rappaport wrote. “The software tools that did consider housing wealth approached it from a wide range of methodology,” she wrote. 

And users of these sorts of tools, especially those who have much of their wealth in housing, should see all sorts of red flags and disclaimers when the software doesn’t address housing wealth. (By the way, most calculators of this sort don’t include the new present value of your Social Security benefits either and that’s something that should be noted as well). 

How to use housing wealth to finance retirement
So what are people who have 70% of their wealth tied up in their home to do? There are a number of options for using housing value to provide for retirement needs, according to Rappaport. But it should be noted that there is not a consensus on the best course of action. 

“Further research needs to be done to define the options, identify the trade-offs, provide a framework for analysis and help individuals make decisions,” Rappaport wrote. And, as with most things financial, she said the ultimate best course of action will also depend on “individual preferences and circumstances.” 

That said, here are the options you have to unlock the equity in your home: 
-Pay off the mortgage, if possible, to reduce overall expenses
-Sell and downsize to a smaller home, freeing up funds for investment or annuity purchase
-Sell your home, invest the proceeds and then rent
-Secure a home equity loan or secondary mortgage on the house
-Get a reverse mortgage
-Rent out extra rooms
-Rent out your primary residence and live elsewhere at a lower cost
-Keep the house mortgage-free, and let its value serve as an emergency fund if needed 

Not all these options might be viable for your retirement plan and some of the options aren’t quite ready for prime time just yet. For instance, “reverse mortgages may offer significant income potential to some households, but at relatively high cost and risk,” Rappaport wrote. “Furthermore, they may help older home owners remain in their homes, but they limit future housing choices and are presented as a last resort option by some financial planners.” 

The Bottom Line
All this means that there’s much more work to be done, said the SOA report. Researchers and advisers need to put finger to calculator and keyboard to try to figure out what portion of their clients’ personal wealth should be spent on housing and whether it should be scaled back. 

What’s more, researchers need to work on models that show the trade-offs between lower spending on housing and more savings put into financial investments vs. what we have now, higher spending on housing and less savings in financial assets. And think-tank types need to “work towards a consensus around accepted methods” to help Americans better understand how to incorporate housing wealth in their retirement plan. 

(c) 2009, MarketWatch.com Inc.

Distributed by McClatchy-Tribune Information Services. 

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Phil Lesh and Bob Weir of the Grateful Dead will be guests of honor at the reception, where they and other attendees will have the opportunity to preview select highlights from the Archive. 

“We’re all good friends, we’re all in real estate and we all love the Grateful Dead,” said Robert Lapidus, President, Chief Investment Officer and Co-founder of L&L Holding Company, LLC, a privately owned real estate company dedicated to investing in office buildings, primarily in Manhattan. “We thought there are so many Deadheads (what devoted fans of the band are known as) in New York, and what better area to bring the archive to and what better place than the New York Historical Society.”

The idea for the exhibit grew from discussions the co-chairs had earlier this year on how to raise publicity for the recently established official Grateful Dead Archive (2008) located at the University of California, Santa Cruz, to which they had made donations. Emanuel Stern, President and COO of Hartz Mountain Industries in Secaucus, NJ, who manages one of the largest privately held commercial real estate portfolios in the country, totaling 38 million square feet over 200 office, industrial, hotel and retail buildings, also has been on the board of trustees at the Historical Society for nine years and was instrumental in connecting the California archive to the East Coast cultural landmark.

“Billy Procida [president of William Procida Inc., an Englewood Cliffs, NJ-based turnaround management firm for middle market real estate companies – and lifelong Grateful Dead fan] called me for support of the band and the recently named archive at UC Santa Cruz. We went out there and met with the archive librarian to discuss ways we could help promote it and I suggested she contact Louise [Mirrer, president and CEO of the New York Historical Society]. Louise loved the idea – that’s how it got started and it’s picked up quite a pace.” 

Stern added that as band members Bob Weir and Phil Lesh learned about the event they offered their participation while Weir is in town with his band Rat Dog this week playing two nights at the Grand Ballroom and three nights at the Beacon Theater in Manhattan. 

Lapidus noted that he personally has seen the Grateful Dead and any of its breakout bands, like Rat Dog and Phil and Friends, over 400 times. “Together, the co-chairs of this event easily have seen the Dead a combined total of 1,000 times.” 

The Grateful Dead: Now Playing at the New York Historical Society traces the career and achievements of a band that became one of the significant cultural forces in 20th century America. Through a wealth of original artwork and documents including concert and recording posters, album art, large-scale marionettes and other stage props, banners and decorated fan mail, the exhibition will explore the musical creativity and influence of the Grateful Dead from 1965 to 1995, the sociological phenomenon of the Deadheads (the band’s network of devoted fans) and the enduring impact of the Dead’s pioneering approach to the music business. 

Materials in the exhibition will be drawn almost exclusively from the extraordinary holdings of the Grateful Dead Archive at the University of California Santa Cruz, established in 2008.

The exhibit, while unique, doesn’t fall outside the norm of historical collections at the New York Historical Society, Stern added. A preeminent education and research institution, the building is home to both New York City’s oldest museum and one of the nation’s most distinguished independent research libraries. The Society is dedicated to presenting exhibitions and public programs, and fostering research that reveal the dynamism of history and its influence on the world of today. Founded in 1804, its holdings cover four centuries of American history, and include one of the world’s greatest collections of historical artifacts, American art and other materials documenting the history of the United States as seen through the prism of New York City and State.

In addition to Stern and Lapidus, co-chairs of the event include: 

Brian Harris, CEO of Ladder Capital, a New York-based specialty finance company that provides a comprehensive set of financing solutions to the commercial real estate industry; 

Tom Marano, chief executive officer of GMAC’s mortgage operations and GMAC’s chief capital markets executive; 

Billy Procida, president of William Procida Inc., an Englewood Cliffs, NJ-based turnaround management firm for middle market real estate companies; 

Brad Settleman, Managing Director of Latus Partners, a real estate private equity fund based in New York City, which seeks to selectively invest in a variety of complex, opportunistic, distressed, and/or transitional real estate transactions using equity, debt and hybrid structures; and 

Marc Warren, Owner, Linear Realty Captial, LLC in the Greater New York area. 

Tickets are still available for $300 and are 100% tax deductible. 

For more information or to purchase tickets, visit https://www.nyhistory.org/web/dead_tickets 

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com. 

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Maybe you’re faced with tattered carpets, battered appliances and dingy paint. Or maybe we’re talking about truly scary problems, such as asbestos, underground oil tanks or leaking roofs. 

What should you take care of first? What can wait? What can be ignored altogether? And how do you keep costs under control? 

“Basically what we’re talking about is good, solid preventive maintenance on your home,” said Barbara Weissmann of Friedberg Properties in River Vale, N.J. She recommends that homeowners looking at a sale down the road hire a home inspector to check out the house. “You’re looking to discover defects that you can fix over time,” she said. She and other experts say it’s possible to get a house ready for market without spending a fortune, especially if you have time on your side. And if you’re going to fix up the property anyway, Weissmann said, “why not do it several years in advance so you can enjoy it?” 

The first jobs to tackle include anything that’s a danger to your health or the house’s future. If the roof is leaking, for example, that will damage the ceiling, walls and floors below. Funky wiring or leaky plumbing? Deal with it sooner, not later. “The biggest killer of a home’s value is no maintenance,” Weissmann said.

If there’s flaking asbestos insulation on the pipes, that’s a health hazard, and can also delay or kill a sale down the line. Don’t try to remove it yourself; get a licensed contractor. 

You should also make sure you have working smoke and carbon monoxide detectors. Check with your town; some require that at the time of sale, the alarms must be wired into the home’s electrical system, a job that requires an electrician. Other municipalities will accept battery-operated alarms. Either way, you also want these in place for your own safety, along with a fire extinguisher in the kitchen. 

When you’re ready to sell, the buyer will generally require that certain major issues be addressed. Better to handle them now than risk delaying or losing a deal later. Aside from asbestos, another big environmental concern is an underground oil tank, which can leak. Jeana Cowie, a RE/MAX agent in Oradell, N.J., recently advised a couple who plan to sell in a few years to deal with the tank now. “I felt that buyers will skip looking at the home because of oil heat,” Cowie said. “And a new gas furnace is a huge positive for all homes.” Maybe you’ve already dealt with the oil tank. But if it was only abandoned in place, be prepared: a buyer will often seek to have it taken out because of concerns that the job was not done properly, said Louis Chapman, a real estate lawyer in Wayne and Teaneck, N.J.. You might want to have it removed before putting the house up for sale. Check for radon gas and deal with it if it’s there; this is something a buyer will also insist on. Try your state department of environmental protection for testing and correction companies. 

Basement moisture often is an issue in home sales, said Dominick Laurita of Interstate Home Inspections in Califon, N.J. It can lead to mold, which can scare buyers away. The most common cause: gutters that aren’t draining rainwater away from the house. “It’s a simple fix,” said Laurita. 

A termite problem also could derail a sale, so you want to act quickly if you find evidence of that. Though inspectors can’t see termite damage hidden behind walls, the insects sometimes leave visible trails. Keep the paperwork on all these jobs to show an eventual buyer. 

Once you get past the most pressing projects, there are a cluster of jobs where you have to weigh the benefits against the costs. In general, home sellers get back only 60% to 80% of the money spent on home improvements, according to Remodeling magazine. “You’re not getting a dollar back for every dollar you spend,” Weissmann said. “Don’t do any remodeling whatsoever, but anything that has to be replaced should be replaced,” said Dick O’Connor, a Dumont, N.J., real estate broker. “You can spend $50,000 to remodel and get only $30,000 back. Just be sure everything is in working order.” 

Michael Fitzpatrick, a Hackensack, N.J., real estate lawyer, said it’s okay to leave some issues to be handled in a negotiation between the seller and buyer, rather than spend a lot to upgrade the house before you even put it on the market.

Most experts recommend against major kitchen or bath renovations. But less ambitious upgrades, such as replacing scratched countertops or outdated appliances, could make sense, they said. “You’ve got to make it look good,” said Maria Rini, a RE/MAX agent in Oradell. “But the spruce-up bill can be a lot less than you imagine.” 

When it comes to cost-effective fix-ups, most housing experts have three favorites: clear out clutter, paint the walls and rip up old carpet. If the wood floors under the carpet are in good shape, great; otherwise, they can be refinished at a cost that typically ranges from $1.50 to $3 a square foot. Bob Olson, a contractor with Home Resources in Ridgefield Park, N.J., said updating doors, moldings and trim can give a home “a fresh new look” at a reasonable cost. 

Improving the landscaping, especially the front yard, is crucial. But it doesn’t have to look like a manicured estate. “Clean up the flowerbeds and trim back the bushes to expose the house,” Rini said. Plant flowers, especially in the front, for curb appeal, advised Barbara Ostroth, a Coldwell Banker agent in Oradell. In winter, you can plant cabbage plants with colorful leaves. 

If your furnace or hot water heater dies, obviously you must replace it. If those items are old but still working, however, most real estate experts advise that you leave them in place and adjust the home price to reflect their age. “If the heating system is old but works, don’t touch it,” O’Connor said. 

One option is to buy a home warranty when you’re ready to sell. A warranty “is a great way to overcome buyers’ objections to older appliances, pipes, electric systems, furnaces and hot water heaters,” Ostroth said. 

New, energy-efficient windows? That’s a costly job that many sellers would rather just leave to the buyers, even it means getting a lower price for the property. “If you’re getting out of the house you would almost never redo the windows, unless they’re rotted through,” Rini said. 

If you decide to renovate a kitchen or bath for your own enjoyment, keep resale in mind. “Try to pick something that is salable. Keep it neutral; don’t put in a green countertop,” said Margrit Vogler of Margrit Vogler Properties in Oradell.

Finishing a basement could be worthwhile if the house is small and there’s no other family room or play space for the kids. But otherwise, most real estate advisers recommend just tidying up instead, by throwing out clutter and painting the walls and floor. 

(c) 2009, North Jersey Media Group Inc.

Distributed by McClatchy-Tribune Information Services.