The Backyard Oasis

Today’s prospective homebuyers are increasingly interested in a property’s outdoor living space as they are its interior. Savvy agents understand this powerful trend and are staging homes on two fronts – the terrific indoors and the great outdoors.

The following tips will help ensure that your backyard is as distinctive at your home itself.

• Make your Backyard Homey: Create a conversation area with some furniture. The area needn’t be elaborate; just two chairs pulled close together with a table between can make even the most basic concrete patio special. Just the idea that an outdoor eating option is possible makes a property more inviting. Adding accessories like a small table, an inexpensive outdoor rug or a few pots filled with flowers will make the area even more attractive.

• Remember the Kids: If you have an old tree house, fix it up and paint it bright colors or add sporty designs that will make other kids fall in love with it. Just make sure the tree house is safe. Add a tire swing to a tree and keep an orderly basket of balls, flying disks and a jump rope so kids dragged along on the showing can play in the yard. Swing sets that are old and unsightly should be removed or refurbished to look new.

• Fire is Hot: There’s nothing like sitting around a fire and enjoying the company of friends and loved ones, which explains the growing popularity of fire pits and outdoor hearths. Few home improvements create the “wow” factor that a backyard fireplace will, and many homeowners are adding a fireplace to their outdoor landscape to recreate all the appeal of their home’s interior outside in the backyard.

• Simple Fixes: You needn’t go overboard with the changes in your yard. Sometimes, the easiest fixes will create a look that people will remember. Do a thorough inspection and replace any damaged boards on your deck or fence, and apply a fresh coat of paint, stain and sealant if the finish requires it. You should also weed and groom your garden and add some perennials for color.

Creating a backyard sanctuary is one of the smartest things you can do to make your home stand out, so make your outdoor space a destination to remember.

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com

Value of Takeaways!

A time-honored business principal maintains that consumers generally base their buying decisions on emotion. Only later do they use logic, often to rationalize their emotional decisions.

Homesellers, working closely with their agents, will prepare their homes to evoke positive and personal emotions for those who come inside. They should also create “takeaways” that will keep those fond memories resonating in prospective buyers.

“One effective takeaway is a personal letter from you describing your experience of falling in love with the home when you were the buyer,” said Kay Steele Faulk, a Lake Village, Ark. freelance writer.

The letter, presented on brightly colored stationery, can describe the fun of meeting your new neighbors and the warm friendships you’ve established in the neighborhood. It can also recall joyous holidays around the home, show pictures of your home during special times and list neighborhood activities scheduled throughout the year.

“You should recall a memorable moment of coming home, such as after the birth of a child or after a long vacation, because these are all things buyers can relate to emotionally, they will serve to reinforce the positive feelings buyers experienced at your home,” Faulk said. “And to satisfy buyers’ logic—which they will use to justify their emotional connection to your home—also describe the loving care you’ve given the home while there.”

Once all the words are in play to touch upon the emotions, then it’s time to write about things that will relate to buyers’ practical sides.

Russell Goldstein, a New Jersey-based writer who often helps homebuyers prepare personal letters, stresses that this is the perfect way to say all the little things you can’t always place in advertisements and fliers.

“You can list your routine maintenance tasks plus any remodeling, updates or upgrades you’ve done in the years you have lived there,” he said. “Include anything that gives buyers a sense of confidence in your home’s current condition, and be sure to mention any special features you paid high dollar for, such as thicker exterior walls, which have better insulation values. These are your home’s key marketing details that make it a better buy than the competition down the street.”

A second effective takeaway is a home brochure created around high-quality color photographs of your home’s interior and exterior. “Use photos that highlight your home’s most appealing features,” Faulk said. “Just be sure each photo has a caption or short description that helps buyers remember. Even with a brochure, you still need that all-important section meant to satisfy buyers’ logic. This can simply be a descriptive sentence followed by a list of your home’s key marketing details and the T.L.C. you’ve given [the home] as owner. To make for easy reading, use bullet points to highlight each item of your list.”

If you’re good at writing warm personal letters or if you have the ability to create a professional-looking brochure, it’s quite acceptable to save money by doing it yourself. If not, turn to a professional copywriter to create a compelling takeaway that ensures a lasting emotional connection with buyers.

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com

Smaller Spaces In Demand

Good things come in smaller packages. At least that’s the feeling today among many homebuyers, who are increasingly interested in smaller spaces instead of the gaudy, sprawling homes that were popular in the ’80s and ’90s.

Many agents believe that smaller homes are more in demand because the Baby Boomer generation is starting to downsize. Boomers no longer need four or five bedrooms and are looking for spaces that are more in tune to their lifestyles as empty nesters. In fact, the latest U.S. Census Bureau reported that a little over 60% of all U.S. households are comprised of just two people or less.

While affordability is the No. 1 driver for this trend, other factors do play a role, as buyers are more concerned with how much they will be paying each month on their energy, water and heating bills.

“You can add better insulation, new windows and insulated doors, but nothing saves energy like a slightly smaller home,” said Danny Gough, an energy auditor for the consultant firm, Energy Solutions, based in N.C. “We have seen an interest in smaller homes because of this.”

Conservation is the new watchword in new-home building and existing home sales, as buyers want to conserve their larger down payments and their future dollars by buying homes they need, not homes that impress the neighbors.

According to a recent study by the National Association of Home Builders, by 2015, new homes will not only be greener and packed with more technological features than today’s homes, but they will be 10% smaller. In its report, “The New Home in 2015,” the NAHB points to the economic downturn for a “less is more” mentality.

“People are looking beyond what they pay in principal, interest and taxes and look closer at what they will be paying each month,” said Stephen Melman, director, Economic Services, Economics and Housing Policy for the NAHB. “Buyers, despite excellent prices and low interest rates, are cautious and are going to purchase the home that they need and not necessarily even the home they can afford. They are very careful.”

This trend has developed quickly. At the beginning of 2007, the median floor area of new homes started was just over 2,300 square feet. The median floor area of new homes dropped to nearly 2,100 square feet by the end of 2010.

“That’s close to a 9% decline in floor area over a very short period,” Melman said. “Total floor area isn’t what’s important there, but the amenities inside the home itself.”

Rooms that are falling out of favor in new homes include media rooms, sunrooms, mudrooms and libraries. Echoing entryways, vaulted ceilings and giant pantries are also less popular.

The report even said that the living room is dying out and will either vanish, merge with another room or become a smaller parlor.

“People are asking what they can truly do without,” Melman said. “Almost 50% of buyers surveyed said they would be willing to give up the living room if affordability is an issue.”

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com

July's Tri-State Real Estate Market Snapshot

We are still slightly down from a year ago, but keep in mind that the numbers were inflated last year due to the rush of first time homebuyers trying to beat the Federal Tax Credit deadline. All around the numbers aren't as bad as the media is making it out to be.

Click Here to see the full report from TrendMLS for Single-Family Homes. Carefully compare your county's real estate market compared to the national stats. You'll be amazed at what you see!

Interested in Condo Sales? Click Here to see what's going on in the condo market. It isn't as pretty as the single-family homes and is generally what happens during market corrections.

The Year-to-Date Market Snapshot contains statistical information for single-family and condominium listings recorded within TREND. This report is organized by county and contains year-to-date information for sales, prices and percentage changes for each of the last three years, so you can clearly see the annual trends in a particular market.

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com

Costs for First-Time Buyers

Buying a new home can be a huge, complex undertaking, especially when it’s your first time. That’s why it’s important to have an experienced real estate agent guiding you along the way.

In a survey conducted earlier this year by Prudential Real Estate and Relocation Services (PRERS), a Prudential Financial, Inc. [NYSE:PRU] company, 75% of respondents highlighted the importance of real estate agents in the process of buying or selling their home, with only 24% saying agents are helpful but not imperative.

“Americans continue to see real estate agents as having a very important role in helping them price, buy and sell their homes,” said James Mallozzi, PRERS’ chairman and chief executive officer. “Although the data underscores the value real estate agents provide, it also shows that the industry needs to continue to work hard to meet clients’ unique needs.”

First-time buyers need to look at their financial situation and crunch the numbers to see if this is the right time to buy. Chances are the numbers they see today will be the best they will see for some time, which is why so many are considering home ownership.

Still, understanding the money that goes into a home purchase is important. The biggest mistake new buyers make is underestimating the costs of buying a house and maintaining it over time.

Homebuying requires more than a down payment as closing costs and future expenses will figure prominently. Many experts agree that homeowners should have 1%-3% of their homes’ purchase price in savings for improvements and surprise expenses. Mortgage experts also say it’s wise to have at least six mortgage payments in the bank after a closing.

While those numbers may not be feasible for everyone, if you are spending above your means on a new home, you may find yourself in financial trouble fast.

Inspections are important for the first-time buyer, as they list repairs that will be needed for the home. A buyer should put together a short-term and long-term plan based on the inspection so they know how much money they will need in the months and years ahead.

As renters, people are accustomed to paying rent and basic utilities. As homeowners, you’ll also pay for water, sewer and trash collection. Then there are property taxes, homeowner’s insurance and homeowner’s association dues, plus yard care, snow removal and other expenses unique to your location.

To be sure, buying a home is one of the largest investments you’ll make and when done wisely, it can be one of the best decisions of your life. Your real estate agent will help each step of the way, first helping you establish a realistic price point for your home purchase and a clear understanding of your monthly expenses.

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com

The 203k Mortgage (Renovation Loan)

Real estate consumers today can find ample value in distressed homes – properties that are under a foreclosure order or up for short sale. In many cases, however, “distressed” speaks more for the condition of the homes than their recent financial histories, as they’ve sat empty for extended periods and have been subject to vandalism and theft.

Those considering homes in need of repair and renovation should consider a 203k mortgage, which enables homebuyers to finance both the acquisition and rehabilitation of the property with just one loan.

“FHA 203k purchase loans are the perfect financing vehicle for homeowners seeking the value proposition offered by REO homes,” said David Wind, president and board chairman of White Plains, N.Y.-based Guaranteed Home Mortgage Company, in a company statement this June. “Home buyers’ ‘perfect’ home can be purchased in less than perfect condition with a single-close loan product that allows repairs and remodeling.”

There are two types of 203k loans: the 203k streamline and the full 203k. The 203k streamline is the most popular among homebuyers and lenders.

“The maximum allowable in repairs is $35,000 under the 203k streamline and it does not allow any structural repairs to be done to the home, unless [the repairs are] a result of an unforeseen circumstance,” explained David Krushinsky, a certified mortgage planning specialist for Mesa, Ariz.-based AmeriFirst Financial Inc. “The full 203k allows structural repairs and will allow the buyer to exceed the $35,000 in home repairs. Both loans allow up to $1,500 in swimming pool repairs.”

Contractors chosen to perform repairs must be licensed, bonded and insured, and they usually must provide the lender with a resume and two client-reference letters.

“After the close of escrow is when all the rehabilitation work begins,” said Krushinsky. “Funds usually aren’t released immediately so it’s important for your contractor to start work in a timely manner. Typically, if they’ve been in business, they have existing relationships with vendors so they can order materials and begin work. If not, the project may take longer than anticipated.”

Since the 203k mortgage is based on the home’s potential value after repairs -- not its existing value -- you can be approved for a higher loan amount. The mortgages also carry long-term-fixed rates, are insured as soon as they fund, and include escrow accounts for the scheduled repairs.

Loan amounts are capped according to local FHA limits. Only owner-occupied properties of one to four units qualify for 203k mortage financing; homes also must be at least one year old.

Chip Plumley can be reached at (610) 444-9090 or (610) 357-8635.
Prudential Fox & Roach is an independently owned and operated member of
Prudential Real Estate Affiliates, Inc., a Prudential Financial company.
Equal Housing Opportunity.

ChipPlumley.com