Remodeling an older home

How can you update an older home, and see some return in your investment when you go to sell it?

Eric Bramlett, with Broker Agent News gave these suggestions:

1. Gut the attic and raise the ceiling in the living room. Older homes have 8 foot ceilings, and it is one of the first things buyers notice.

2. Knock down the walls. Not the load bearing walls, but if you can open up the downstairs, it will flow better.

3. Overhaul the kitchen and/or master bathroom. Is one of the best returns.

4. If the house has one bathroom, add a master bathroom. Adds value, and convenience. Make sure there are 2 sinks, if possible.

Should I buy now?

Buyers are looking at houses, and they see that they have been on the market for up to a year. They ask, "if I buy now in a slow market and I want to sell in a few years quickly, am I stuck?"

Short answer: Not likely.

Long answer: There is no doubt that home prices are soft, and there are lower interest rates. Yet people in Orlando need to remember that we are coming off a period of very quick appreciation. In 2005 and the beginning of 2006, due to limited supply, home prices skyrocketed. Prices in Orlando had been low, compared to other areas of the country. Investors flocked to invest and make some great money.

Some of the people who put their properties on the market at the beginning of 2006 did not sell them as expected, and the market took a dramatic slow down from August to December of last year. Some property prices have been overinflated, trying to capitalize on what happened in 2005.

As for a home appreciating, the projected existing home prices are expected to increase in the coming years. The stronger gains will most likely happen in 2008. It won't take off like 2005, but appreciation is likely.

Why is the market sluggish now? Because there are a lot of properties on the market. The real estate market is cyclical, and it does not respond quickly to shifts. Because of the time it takes to build a house and/or a person to decide to sell and list their house, the housing market does not bounce back in a matter of days---it can take months.

With the strong economic factors expected in Orlando due to employment, new business, and the average number of people moving here daily, there is no reason to expect a recession, leading to depreciated property rates next year.

I don't have a crystal ball......

...so I read a lot about the real estate market from experts in the field. The chief economist for the National Association of Realtors, David Lereah, states that existing-home sales are projected at 6.42 million this year, and 6.66 million in 2008, compared with 6.48 million last year. Although some home sales will be reduced by the sub-prime loan restrictions, they should be gradually rising this year and next.

I know I am sounding like a broken record, but this is a good time to buy!

Are you ready to buy?

With all the discussions about sub-prime loans and home prices, many of the people I talk with are concerned they can't afford a home. You do need savings to be a good homeowner, for maintenance and emergencies.

But how much is too much to spend on a house?

The rule of thumb is 33%. Your monthly housing costs, including principal, interest, taxes and insurance should not be more than 33% of your gross income. With all your other loans and credit cards, your total debts should not be more than 38% of your gross income.

If you have any additional questions about affording a home, give me a call.

Osceola County---great and growing

Forbes has recently reported that Osceola County, Florida is one of the fastest growing counties in the US. It is in the top 25, according to the Census Bureau's analysis between April 1, 2000 and July 1, 2006. This is one of several counties in Florida that is viewed as an alternative to the priciest areas in South Florida.

Florida ranks #1 in Foreclosures

CNN Money reported today that Florida had the most homes in the foreclosure process nationwide in February, according to RealtyTrac, which reported a two-fold year-over-year gain in delinquencies – more than 19,144 statewide.

Foreclosure filings are also recording double-digit increases in California, Nevada and Arizona, mainly because large numbers of speculative investors cannot sell properties purchased during the recent housing boom.

Is now a good time to buy?

Yesterday I was out walking with a friend, who is currently renting an apartment. She is in a new job as a teacher, and doesn't know how long she will stay in her current position. She has all the necessary resources to purchase, but her question was: "Is now a good time to buy a house?"

I get this question frequently, given the current real estate market. So much has been changing over the years. Property values have significantly increased in Orlando. The news is reporting on the sub-prime loan problem every day. There are mixed messages in the media.

My response: Yes, it is a good time to buy. Why? The interest rates are good. There are properties to purchase in every price range. The key? Buying property is a great investment. You have tax advantages not available to renters. When you leave an apartment, you don't see any appreciation in your asset! Consider the advantages......