Follow by Email

Monday, June 22, 2015

A Guide to Decking Materials

There is something liberating about spending time outside on a deck. Whether you make it a private retreat shaded by vegetation or an energetic entertainment area complete with a built-in BBQ, this outdoor living space is often the most enjoyable area of a home. It also increases the value of your home. Most homeowners see a return on investment between 74% and 87% after adding or renovating a deck. Before you start building, however, you want to make sure that the material you choose matches the exterior of your home and fits your lifestyle. This quick guide on some of the most popular decking materials will help you decide which material best suits your needs.

Wood

Lifespan: 10–30 years
Maintenance: High

Wood decking is the most common choice for residential decks. Durable and strong, it also offers a classic look that complements traditional, craftsman, and virtually any other style of home. The smooth planks stay cool and feel good on bare feet, making wood a natural choice for building your outdoor oasis. Softer woods are fairly easy for a novice do-it-yourselfer to work with; hardwoods generally require a stronger skill set.

The price of wood varies greatly depending on the type you choose. Pressure-treated pine is the least expensive material, but it typically needs to be replaced after about 10 or 15 years. Tropical hardwoods such as ipe, camber, or garapa look stunning and last for upward of 30 years. They also cost quite a bit more per lineal foot. Cedar and redwood are popular choices that fall in the middle of the price spectrum and have a lifespan of about 20 years. Professional installation will add to the price of the deck.

Regardless of the type of lumber you choose, it will require a fair amount of maintenance. Wood decks needs to be cleaned annually and restained and resealed every few years. You may also need to replace a board or two over the life of the deck. If not properly maintained, the wood will absorb stains—especially red wine or BBQ sauce—and will be more prone to cracking, rotting, and warping.

Composite

Average lifespan: 20+ years
Maintenance: Moderate

Composite is an environmentally friendly choice for those who love the look of wood but aren’t as enamored with the upkeep. Premium planks boast a textured surface that mimics the look of wood grain. Made from a combination of recycled plastic and waste wood fibers, composite is available in an array of colors and makes a stylish addition to most any home. Some types of composite also feature grooves in the edges of the planks to allow for hidden fasteners—no unsightly screws. Composite decks are relatively easy to install, but it is imperative to follow the manufacturer’s instructions to allow enough room for heat expansion.

You can expect to pay more for composite decking than for wood boards. It can run two or three times as much as pine, but it usually costs less than exotic hardwoods. Extras, such as scratch-resistant features and UV coating, will up both the price and the life expectancy of the deck. Homeowners will likely recoup the additional costs though, since there is not as much maintenance involved over the life of the structure.

Composite materials need to be scrubbed annually with mild soap and water to prevent mildew. Aside from that, they require very little maintenance. The color often fades with prolonged exposure to the sun, so this may not be the ideal choice for a west- or south-facing location.

Plastic/PVC/polyethylene

Average lifespan: 30+ years
Maintenance: Low

Smooth and splinter-free, this lightweight material is strong enough to withstand the harshest elements of nature. It is impervious to stains and resistant to fading, making it a great choice for an outdoor dining area. Unlike other types of decking, plastic decks typically feature a nonslip coating that becomes less slippery when wet. Even with a faux-wood grain finish, this material does not look natural and may clash with homes that have wood or stone exteriors. The synthetic material also gets rather hot in direct sunlight and can burn bare feet.

Decking made from plastic is comparable in price to its composite counterpart. Certain brands are more prone to sagging than others, so it is a good idea to pay a little extra for a reliable brand. Plastic typically requires a more extensive support structure than lumber because it is not as rigid, which also increases the total cost of the project.

Plastic decking does not necessitate any sanding, staining, or painting. All it requires is seasonal cleaning to keep it looking fresh and new.

Aluminum

Lifespan: 50+ years
Maintenance: Low

Anodized aluminum decking offers a modern look that pairs well with contemporary-style homes. It is also a viable choice for destination decks near natural streams or manmade water features, because the textured finish boasts added traction. It also stays cool, making it barefoot-friendly even in sweltering temperatures.

Aluminum is one of the higher-priced types of decking material. Features such as a polyuria coating to reduce the sound of footfalls and tightly interlocking planks to prevent water from penetrating below will add to the price as well, but they are worth the investment—especially on second-story decks.

Like other synthetic decking materials, aluminum is virtually maintenance-free. It will not rust or rot and is resistant to mold and mildew. A quick sweep of the broom to keep it free of dirt and debris or an occasional hose-down to remove bird droppings or sap is all it requires.

The bottom line

These are four of the most popular types of materials used to construct residential decks. Even though wood is the most prevalent material, that doesn’t mean it is the right choice for your home. Take the time to consider the location of your deck, its intended use, and how much maintenance you are willing to take on before committing to a certain material. A well-designed deck built from the right material has the potential to become the best part of your home.

This story originally appeared on HomeAdvisor.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.



                 408.687.2026 |  Julie@JulieWyss.com | www.JulieWyss.com

Monday, June 8, 2015

15-Year Or 30-Year Mortgage?

One of the best ways to eliminate your mortgage debt is moving into a 15-year fixed-rate loan. With the average spread a full 1% compared to its 30-year counterpart, a 15-year mortgage can provide an increased rate of acceleration in paying off the biggest obligation of your life.

Can you pull it off?

In most cases, you’re going to need strong income for an approval. How much income? The old 2:1 rule applies. Switching from a 30-year mortgage to a 15-year fixed-rate loan means you’ll pay down the loan in half the amount of time, but it effectively doubles up your payment for each month of the 180-month term. Your income must support all the carrying costs associated with your home including the principal and interest payment, taxes, insurance, (private mortgage insurance, only if applicable) and any other associated carrying cost. In addition, your income will also need to support all the other consumer obligations you might have as well including cars, boats, installment loans, personal loans and any other credit obligations that contain a monthly payment.

The attractiveness of a 15-year mortgage in today’s interest rate environment has mass appeal. The 1% spread in interest rate between the 30-year mortgage and a 15-year mortgage is absolutely real and for many, the thought of being mortgage-free can be very tempting. Consider today’s average 30-year mortgage rate of around 4% on a loan of $400,000—that’s $287,487 in interest paid over 360 months. Comparing that to a 15-year mortgage over 180 months, you’ll pay a mere $97,218 in interest. That’s a shattering savings of $190,268 in interest, but there’s a catch—your monthly mortgage payment is going to be significantly higher.

Here’s how it breaks down. The 30-year mortgage in our case study pencils out to a $1,909 monthly payment covering principal and interest. Weigh that against the 15-year version of that loan, which comes to $2,762 a month in principal and interest, totaling $853 more per month, but going to principal. This is why the income piece makes or breaks the 15-year deal. Independent of your other carrying costs and other credit obligations, you’ll need to be able to show an income of $4,242 a month to offset just a principled interest payment on the 30-year fixed-rate mortgage. Alternatively, to offset the principled interest payment on the 15-year mortgage, you would need an income of $6,137 per month, essentially $1,895 per month more in income, just to be able to pay off your debt faster. As you can see, income is a large driver of debt reduction potential.

What to do if your income isn’t high enough

When your lender looks at your monthly income to qualify you for a 15-year fixed-rate loan, part of the equation is your debt load.

Lenders are going to consider the minimum payments you have on all other credit obligations in the following way. Take your total proposed new 15-year mortgage payment and add that number to the minimum payments on all of your consumer obligations and then take that number and divide it by 0.45. This is the income that you’ll need at minimum to offset a 15-year mortgage. Paying off debt can very easily reduce the amount of income you might need and/or the size of the loan you might need as there would be fewer consumer obligations handcuffing your income that could otherwise be used toward supporting a stable mortgage plan.

Can you borrow less?

Borrowing less money is a guaranteed way to keep a lid on your monthly outflow maintaining a healthy alignment with your income, housing and living expenses. Extra cash in the bank? If you have extra cash in the bank beyond your savings reserves that you don’t need for any immediate purpose, using these funds to reduce your mortgage amount could pencil very nicely in reducing the 15-year mortgage payment and interest expense paid over the life of the loan. The concept of the 15-year mortgage is “I’m going to have to hammer, bite, chew and claw my way through a higher mortgage payment in the short term in order for a brighter future.”

Can you generate cash?

If you can’t borrow less, generating cash to do so may open another door. Can you sell an asset such as stocks, or trade out of a money-market fund in order to generate the cash to rid yourself of debt faster? If yes, this is another avenue to explore.

You may also want to explore getting additional funds via selling another property. If you have another property that you’ve been planning to sell such as a previous home, any additional cash proceeds generated by selling that property (depending upon any indebtedness associated with that property) could allow you to borrow less when moving into a 15-year mortgage.

Are you an ideal match for a 15-year mortgage?

Consumers who are in a financial position to handle a higher loan payment while continuing to save money and grow their savings would be well-suited for a 15-year mortgage. The other school of thought is to refinance into a 30-year mortgage and then simply make a larger payment like you would on a 25-year, 20-year or 15-year mortgage every month. This is another fantastic way to save substantial interest over the term of the loan, since the larger-than-anticipated monthly payment you make to your lender will go to principal and you’ll owe less money in interest over the full life of the loan. As cash flow changes, so could the payments made to the loan servicer, as prepayment penalties are virtually nonexistent on bank loans.

There is an important “catch” to taking out a 15-year mortgage—you also decrease your mortgage interest tax deduction benefit. However, if you don’t need the deduction in 15 years anyway, the additional deduction removal may not be beneficial (depending on your tax situation and future income potential).

If your income is poised to rise in the future and/or your debt is planned to decrease and you want to have comfort in knowing by the time your small kids are teenagers that you’ll be mortgage-free, then a 15-year loan could be a smart move. And when your mortgage is paid off, you’ll have control of all of your income again as well.

Proximity to retirement is another factor borrowers should consider when carrying a mortgage into retirement isn’t ideal. These consumers might opt to move into a faster mortgage payoff plan than someone buying a house for the first time.

Keep in mind that to qualify for the best interest rates on a mortgage (which will have a big impact on your monthly payment), you need a great credit score as well. You can check your credit scores for free on Credit.com every month, and you can get your free annual credit reports at AnnualCreditReport.com.

This article was written by Scott Sheldon and originally published on Credit.com.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.








                 408.687.2026 |  Julie@JulieWyss.com | www.JulieWyss.com

Monday, May 25, 2015

Getting Your Home Ready For An Open House


Many homeowners must sell their houses before moving into or buying a new home. As such, they need to hold an open house while they and everything they own is still in the home.

Holding an open house is an act of faith. You clean, declutter, and possibly stage your home to look its best, hoping at least one of the visitors will fall in love enough to make an offer. At the same time, open houses are invitations to strangers to walk among your most prized possessions.

Below are some very important tips for homeowners to secure their home in advance of holding their home open.

Say ‘No’ to drugs

Remove all prescription drugs from your medicine cabinet, even the ones you think are harmless. There are so many tales of open house visitors rifling through medicine cabinets and taking a few pills, or even whole bottles.

Control your remotes

Most people don’t think about the extra garage remote they leave dangling from a hook near the back door. It’s small and easy to slip into a pocket, so take it with you when you leave for the open house. All keys, remotes, and fobs should either be locked away or in your pocket.

File this under ‘Lock & Key’

There’s a trend in home office decor to make file cabinets pretty and portable—but portability and security are not always compatible. Buy a heavy, nonrolling commercial-grade filing cabinet that locks—and into it put your important documents: birth and marriage certificates, financial statements, basically any legal, medical, or personal information you wouldn’t want falling into someone else’s hands. Also, be sure to remove any mail, magazines, certificates and personal photographs that in any way reveal your identity. Identity theft is real and should be taken seriously.

What about my 50-inch flat-screen?

While it’s unlikely that anyone could walk out of your open house with your TV or other large electronics, they could come back for it. That’s why the next item is so important:

It ain’t over till you check your doors & windows

A good agent will go through to make sure all lights are off and the house is in good condition after an open house as well check the doors and windows. Unscrupulous people have been known to unlock a window or basement door with the thought of returning later. After the open house, it is always a good idea to walk through your house and double check every window (even on the second floor), gate and door to be certain that they’re all secured.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.


           408.687.2026 |  Julie@JulieWyss.com | www.JulieWyss.com

Monday, May 11, 2015

Are You Ready To Buy A Home?

While it may be acceptable to snap up a pair of shoes on an impulse, the choice to buy a home requires thoughtful planning and decision making.

Whether you’re becoming a homeowner for the first time or you’re a repeat buyer, buying a home is a financial and emotional decision that requires the experience and support of a team of reliable professionals including a REALTOR®, a lender, a lawyer and a range of other individuals.

Why Do You Want to Buy a Home?

The emotional part of the decision comes into play when you think about why you want to move. If you’re a first-time buyer, you need stability in your career and the desire to commit to living in the same community for five to seven years. You should want to establish roots in a neighborhood and look forward to decorating as you please without requiring a landlord’s permission.

Purchasing a home is a lifestyle choice that requires you to think about how you like to spend your time and the type of community where you want to live—such as a rural area without nearby neighbors, a high-rise building in a city or a home within a planned community with recreational amenities.

The more you understand your priorities for a home, the easier it will be for you to narrow your real estate decisions.

Homeownership can also be a powerful way to increase your personal wealth for you and your family, since you’ll be building equity in your home as you pay off your mortgage.

Are Your Finances Ready for Homeownership?


While your dream home may not be within your reach right away, you can take steps to become a homeowner the moment you earn your first paycheck.

In order to qualify for a mortgage to buy a home, you’ll need good credit, a pattern of paying your bills on time while still saving money and a maximum debt-to-income ratio—your gross monthly income compared to the minimum payments on all recurring debts—of 43% or less. Some lenders have stricter guidelines, so the lower your debt-to-income ratio, the better your chances of a loan approval.

While loan programs are available with low down payments of 3.5% to 5%—and a few programs offer no down payment at all—you’ll still need some savings to pay for closing costs, moving expenses and an earnest money deposit on a home. It also is very wise to have cash reserves on hand after you buy.

Saving money and preserving or improving your credit history are essential elements to homeownership.

What Can You Afford to Buy?

Housing prices and rents vary from one location to another, but you can use a Rent vs. Buy calculator to estimate the difference between your current rent and buying a home. In some markets, buying a home can cost the same or even less than renting.
       
Remember, when you’re a homeowner, you also need to include homeowners insurance, property taxes and homeowners association dues in your housing costs. You can use a home affordability calculator to help you estimate what you can pay for a home.

In addition, you should think about your plans for the future and how you spend your money—along with your comfort level with a mortgage payment. A lender will tell you how much you can borrow, but that lender won’t know how much you spend on travel or golf or your plans for potentially reducing your work hours when you have a family.

Once you’ve thought through the emotional and financial aspects of becoming a homeowner, your next steps should be to find a reliable, experienced REALTOR® to become your partner in the home-buying process and to meet with a reputable lender who can discuss your options for financing your purchase.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.


 

Monday, April 27, 2015

12 Ways to Make a Fantastic First Impression

First impressions count.

You may not be able to tell a book by its cover, but you’ll likely pay more for a book if the cover is charming and attractive.

If your home is for sale, or soon will be, creating a positive first impression is one of the most important things you can do. Thankfully, it’s not hard. Here are 12 steps you can take; most of them fall under simple maintenance and organization, but some of them could possibly help you decide when it’s time to move.

How to impress visitors

1. Go outside. Mow the law, prune bushes, remove dead tree branches, and get rid of outdoor furniture you don’t plan to take with you.

2. Clean the front door and lintels, or paint them if necessary.

3. Check for leaks throughout the house. A drip may not seem important, but it could suggest poor maintenance elsewhere in the house. Don’t leave room for doubt in a buyer’s mind.

4. Clean out closets and storage areas. Donate old clothes and furniture to local charities. This will create a sense of greater space in the home, and mean fewer items to move.

5. Professionally clean the carpets. This is especially important if the carpeting will remain for the new owners.

6. Flip every switch to make sure the electrical works throughout the house. Prospective home buyers will do this. Fix any switches that need help.

7. Caulk around tubs and sinks. New caulk looks better than old caulk, and you’ll also prevent those tricky leaks.

8. Replace lightbulbs that don’t work and use as much wattage as the fixture will take. Good illumination makes your home seem light and airy.

9. Tour the property from the perspective of a first-time visitor. Is there anything that may seem uncomfortable to visitors? The 30-year-old green shag carpeting can be off-putting and mirrors in poorly lit basements can be dangerous, for example.

10. Clean out medicine cabinets. Remove out-of-date items, and consider removing prescription pills when buyers visit. Buyers might look in every nook and open every door. No one wants to be embarrassed by what they find.

11. If you have a pet, make arrangements to have it elsewhere when your home is being shown. Some people have allergies. No one wants to be barked or pawed at when they enter.

12. Ask your broker to examine the property for specific showing tips to make your home more attractive when compared to others in the area.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.






Monday, April 13, 2015

What Stays With the House When You Move?

When you’re selling your home, it is natural to assume that anything you can safely remove is yours to keep—like the light fixtures you painstakingly cleaned and repaired, or the appliances you bought last year—but the buyer may want some of those items, too.

Rather than keep everything, you should decide what you can keep and what you should leave as a way to entice buyers into making an offer. Here’s what you should consider:

What stays with the house?

Generally, certain items stay with the house when you sell and move. Here’s what to expect:

Built-ins: Built-in bookshelves, benches, and pull-out furniture generally stays inside the home.

Landscaping: Trees, shrubs, and any flowers planted in the ground should stay in the yard.

Wall mounts: If you have TV wall mounts or picture mounts that might damage the wall if you remove them, it is a good idea to leave them in place when you move.

Custom-fit items: If you have custom-made curtains, plantation shutters, or blinds, leave them on the windows and doors.

Hardware: If you upgraded the knobs and drawer pulls in your bathrooms and the kitchen, you’ll either have to leave those behind or install replacements before you move.

Alarm systems: Wireless alarm systems are designed to be removed. Otherwise, leave the alarm monitoring station attached and either relocate or cancel the monitoring service.

Smoke detectors: Smoke detectors and sprinkler systems should stay in the house, especially if you plan to move before selling the house.

What can you take?

While you’re expected to leave some items behind, in general your belongings are yours to keep. Here are some examples:

Patio furniture, lawn equipment, and play sets: If you have a wooden swing set in the backyard and a bistro table on the front porch, take those items with you.

Appliances: Some lenders require that a home have an oven installed before approving a loan, but for all other appliances, it’s up to you to decide what you will take and what you will offer as part of the home.

Some light fixtures: Generally, homeowners leave light fixtures behind, but if you’re attached to a certain fixture, you can make arrangements with the buyer to take it.

Built-in kitchen tools: If you can safely remove a mounted spice rack or the pasta arm, you can take it with you.

Rugs, basic curtains, wreaths: Small decor items like rugs or curtain rods that can be safely removed can be taken.

What should you consider leaving?

Some of your personal items can be used to help sell your house—or increase the asking price. Before you take everything just to take it, consider offering some hot items like the following:

Appliances: Homeowners, especially new homeowners, don’t always have their own appliances. Many buyers would be more likely to place an offer on a home if it came fully stocked with appliances.

Custom swing and play sets: If you have a swing set or playhouse your children have outgrown and you notice a potential buyer has children, offer to include the item with the deal.

Kitchen built-ins: Built-in spice racks, pantry organization, and windowsill shelves can really help sell a kitchen. Consider offering the items to an interested buyer.

Light fixtures, curtains, rugs, and other upgrades:
If you’ve upgraded the light fixtures or have custom rugs in the entryway, a buyer may be willing to increase his or her offer to keep those items in the home.

If you’re not sure what would entice a buyer, ask your Realtor® to provide suggestions.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.


Monday, March 30, 2015

Sold Your Parents’ Home in 2014? Check This Tax Advice

Q. We sold our parents’ home in 2014. What do we need to know for taxes this year?
A. The tax implications of a home sale can be complex, particularly when you’re selling a relative’s property rather than your primary residence. It’s always best to consult a professional tax adviser to get individualized advice, but there are some general tax tips that could apply to your situation.

Selling a home as an heir to the property

Your tax bill will vary according to how you acquired the property and when.

Recent inheritance. “If you inherited your home through a will or a trust and you sold it right away, you won’t have to pay a capital gains tax,” says Pat Simasko, owner of Simasko Law in Mount Clemens, MI.

Your residence. If you’ve lived in the property as your primary residence for at least two of the past five years, then you would be eligible for a capital gains exclusion up to $250,000 (single tax filer) or $500,000 (married couples filing jointly), says Simasko.

Investment property. On the other hand, if you’ve kept the home for a few years, you could owe taxes on your profit from the sale if you haven’t claimed it as your primary residence, Simasko says. This situation applies whether the home has been empty or you’ve used it occasionally.

Heirs who sold their parents’ home without having lived in it—but did not do so immediately after the property was inherited—will have to determine the “basis,” or value of the property, for tax purposes, says Vanessa Borges, an enrolled agent and tax preparation supervisor at Tax Defense Network in Jacksonville, FL. Next, you subtract the basis price from the sales price to determine whether you have a profit or a loss.

The good news is that beneficiaries typically have a “stepped-up” basis for a home, which is the property’s fair market value at the date of the parents’ death, says Borges. When you sell that property, you pay taxes only on gains over that basis, not the original price of the home.

For example, if your parents purchased their home for $50,000, but the property value when they passed away was $100,000, you would pay capital gains taxes only if you sold the house for more than $100,000. If you keep the house for years and then sell it for $200,000, then you would owe capital gains taxes on the $100,000 profit, says Borges.

Selling a home when your parent moves to assisted living

A similar situation applies if one of your parents has already passed away and the other recently moved into assisted living.

“If one of the parents is deceased, the surviving parent receives the ‘step up’ in basis at the time of death,” says Borges.

If you sold the home on behalf of your parent, then the parent would be responsible for paying a capital gains tax on that stepped-up basis.

Simasko says, though, that your parent may owe extra taxes depending on how long he or she has been in assisted living.

“The city or the county where the house is located can claim the house as ‘nonhomestead,’ considering the parent’s primary residence is the assisted-living facility,” says Simasko. “The taxes could be higher, because the property would be considered a second home.”

Selling a home when the property has been transferred to your name

Borges warns that there are multiple tax and financial implications for transferring property from parent to child. For example, the child might owe transfer and gift taxes when the transfer is completed. There can be an inheritance tax owed on the percentage of the property being transferred to a child or children after death, as well as capital gains tax, if the child hasn’t been living in the property for two of the past five years.

As you can see, the tax impact of selling your parents’ home can be complicated, so it’s always wise to consult a tax adviser familiar with your state laws, IRS regulations, and your finances.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.