Category — Blogs

While homeowner’s cannot expect to get 100% return on their home remodeling projects, the following are the top, mid-range projects from this year’s Remodeling Magazine’s annual Cost vs. Value report for 2011-2012, based on what home owners stand to recoup at time of resale.  Note: these are the national averages.  The report also has regional averages – for example, in the South Atlantic Region (Maryland), the Attic Bedroom remodel cost recouped is 80.6%.

1. Replacing the entry door to steel

Estimated cost: $1,238
Cost recouped at resale: 73%

2. Attic bedroom (converting unfinished attic space into a bedroom with bathroom and shower)

Estimated cost: $50,148
Cost recouped at resale: 72.5%

3. Minor kitchen remodel (including new cabinets and drawers, countertops, hardware, and appliances)

Estimated cost: $19,588
Cost recouped at resale: 72.1%

4. Garage door replacement

Estimated cost: $1,512
Cost recouped at resale: 71.9%

5. Deck addition (wood)

Estimated cost: $10,350
Cost recouped at resale: 70.1%

6. Siding replacement (vinyl)

Estimated cost: $11,729
Cost recouped at resale: 69.5%

Solving wet-basement problems is one of the most important things you can do to protect the value of your home and health of your family.

Some wet basements are easy to cure simply by clearing gutters and by diverting gutter water away from the foundation. But if the problem comes from other sources—water flowing toward the house on the surface, seeping in from underground, or backing up through municipal storm drains—you must take more aggressive action.

Here are eight strategies to keep water out of your basement.

 1. Add gutter extensions

 If downspouts are dumping water less than 5 feet away from your house, you can guide water farther out by adding plastic or metal gutter extensions.

 But extensions aren’t the neatest or most effective long-term solution, especially if you’re likely to trip over them or run over them with a lawn mower. Permanent, underground drain pipe is invisible and capable of moving large quantities of gutter runoff much farther from your house.

 For about $10 a foot, a landscaper or waterproofing contractor will dig a sloping trench and install pipe to carry the water safely away.

 2. Plug gaps

If you see water dribbling into the basement through cracks or gaps around plumbing pipes, you can plug the openings yourself with hydraulic cement or polyurethane caulk for less than $20.

 Plugs work when the problem is simply a hole that water oozes through, either from surface runoff or from wet soil. But if the water is coming up through the floor, or at the joint where floor and walls meet, the problem is groundwater, and plugs won’t do the trick.

 3. Restore the crown

If the gutters are working and you’ve plugged obvious holes, but water still dribbles into your basement or crawl space from high on foundation walls, then surface water isn’t draining away from the house as it should.
Your house should sit on a “crown” of soil that slopes at least 6 inches over the first 10 feet in all directions.

 Over time, the soil around the foundation settles. You can build it back with a shovel and dirt. One cubic yard of a water-shedding clay-loam mix from a landscape supply house costs around $30 (plus delivery) and is enough for a 2-foot-wide, 3-inch-deep layer along 57 feet of foundation.

 4. Reshape the landscape

Since your home’s siding slightly overlaps its foundation, building up the crown could bring soil–and rot and termites–too close to siding for comfort: 6 inches is the minimum safe distance. In that case, create a berm (a mound of dirt) or a swale (a wide, shallow ditch), landscape features that redirect water long before it reaches your house.

 In small areas, berms are easy; a landscape contractor can build one for a few hundred dollars. On bigger projects, berms make less sense because you’ll have to truck in too much soil. In that case, dig a swale (about $1,000). Once landscaping grows in, berms and swales can be attractive features in your yard.

 5. Repair footing drains

If water is leaking into your basement low on the walls or at the seams where walls meet the floor, your problem is hydrostatic pressure pushing water up from the ground.

 First, check whether you have footing drains, underground pipes installed when the house was built to carry water away from the foundation. (Look for a manhole or drain in the basement floor or a cleanout pipe capped a few inches above the floor.)

 If the drains are clogged, open the cleanout and flush the pipes with a garden hose. If that doesn’t work, a plumber with an augur can do the job for about $600.

 6. Install a curtain drain

If you don’t have working footing drains, install a curtain drain to divert water that’s traveling underground toward your house.

 A type of French drain, a curtain drain is a shallow trench–2 feet deep and 1.5 feet across–filled with gravel and perforated piping that intercepts water uphill of your house and carries it down the slope a safe distance away.

 If the drain passes through an area with trees or shrubs, consider switching to solid pipe to reduce the risk of roots growing into the piping and clogging it. Cost: $10 to $16 per linear foot.

 7. Pump the water

If you can’t keep subsurface water out, you’ll have to channel it from the inside.

 To create an interior drain system, saw a channel around the perimeter of the floor, chip out the concrete, and lay perforated pipe in the hole. The pipe drains to a collection tank at the basement’s low spot, where a sump pump shoots it out the house.

Starting at about $3,000, an interior system is the best and least disruptive option in an unfinished basement with easy access. It’s also a good choice if your yard is filled with mature landscaping that digging an exterior drainage system would destroy.

 8. Waterproof the walls

Installing an interior drainage system gets the water out but doesn’t waterproof the walls. For that, you need an exterior system: a French drain to relieve hydrostatic pressure and exterior waterproofing to protect the foundation.

 It’s a big job that requires excavating around the house, but it may be the best solution if you have a foundation with numerous gaps. It also keeps the mess and water outside, which may be the best choice if you don’t want to tear up a finished basement.

 The downside, besides a price tag that can reach $20,000, is that your yard takes a beating, and you may need to remove decks or walkways.

By: Jeanne Huber ReBlogged from HouseLogic – Realtor.com

The graphic depicts pricing of all homes from their ‘peak through current declines’ as per Case Shiller. This index looks at prices in 20 major metropolitan areas.

Each market peaked at different times. Therefore, the InfoGraphic doesn’t cover one segment of time. Here is a site where you can see when each market actually peaked:

CLICK HERE

Courtesy The KCM Blog

MRIS, the database used by professional real estate agents in the Mid-Atlantic states to list homes for sale and rent, now has a new feature – searching for neighborhoods suited to your lifestyle.  Public access is through HomesDatabase, the public portal.

You can adjust parameters for:

• Fun & Entertainment
• Shops & Stores
• Family & Child Friendly
• Highly Rated Schools
• Pet Friendly
• Median Home Price
• Rural, Small Town, Suburban, Urban, Downtown
• Public Transportation

The usual search parameters for homes are also available (e.g. single family detached, townhome, etc.).  An interactive map has icons for the homes for sale.

This is great for anyone who is unfamiliar with the area or who may be deciding where they want to live.

Check it out for yourself – let me know what you think!

LIFESTYLE SEARCH

There is more and more research coming out showing that it makes great financial sense to purchase a home today . Whether it be rent vs. buy ratios, income-to-price ratios or income-to-mortgage payment ratios, purchasing a home right now is a bargain compared to historic norms. Now we want to look at the COST of a home today compared to pre-peak prices.

According to the most recent S&P Case Shiller price index, residential real estate values have returned to 2003 prices. That, in itself, says something. However, when you factor in mortgage rates, the case for buying a home today becomes even more compelling.

In 2003, 30 year mortgage rates stood at 5.88%. Today, they are 4%. How does that impact the actual COST of a home? On a home purchased for $250,000, here is the difference in monthly cost:

That means you save $285.30 a month, $3,423.60 a year and $102,708 over the life of a 30 year mortgage! You buy the home for the same PRICE but the COST is over $100,000 less.

Bottom Line:
This is why so many financial advisors are saying that this may be one of the greatest times in history to purchase a home!

Reprinted from the KCM Blog - www.kcmblog.com

 Example A- Short Sale

Mr. Smith owns a home in which he has a mortgage balance of $220,000 and a current market value of $150,000. Mr. Smith has elected to short sell his property. His Realtor successfully obtains a buyer who puts forth an offer price of $120,000 (80% current market value according to Realty Trac Foreclosure Report 5/26/2011). After reviewing the buyers offer and the financial hardship information from Mr. Smith, Mr Smith’s bank agrees to accept the short payoff of $120,000 which would leave a deficiency balance of $100,000.

The transaction closes and is final.  Mr. Smith then pulls his credit report 30 days after the transaction takes place. On the report he notices that the mortgage trade line states “Mortgage debt was settled for less than full” and the balance on the mortgage is $0.  Mr. Smith is now on the road to financial recovery.

Example B- Foreclosure

For the ease of illustration we will use the same value and mortgage debt amounts as in Example A. However, Mr. Smith has elected to forgo the short sale process and let the bank foreclose on the property.  The bank holding his mortgage facilitates the proper legal procedures to foreclose on the property, all of which are costly.  Mr. Smith is notified and his property foreclosed upon of which is taken back by the bank to sell as an REO.

Six months later, the bank finally sells Mr. Smith’s home only they sell it for $90,000 (60% of current market value according to Realty Trac Foreclosure report dated 5/26/2011). Remember, as a short sale, the home would have sold for $120,000 keeping the deficiency to $100,000. In addition to the deficiency now being $130,000, the bank has elected to add on legal costs of $15,000 and asset preservation costs of another $5000 for a total deficiency liability of $150,000. Mr. Smith pulls his credit report 30 days after being notified that the bank has sold his property and of his liability.

On the report he notices that the mortgage trade line states “Foreclosure” and the balance is $150,000. Because of Mr Smith’s choice to choose foreclosure vs. short sale his road to financial recovery has taken a major detour. He not only has a foreclosure on his credit report but now has a much larger deficiency balance in which the bank, in most cases, will report on his credit report as a balance owed.

The Best Option is Clear

While the financial and credit advantages are clear when choosing a short sale over a foreclosure, other advantages are sometimes overlooked. The most important of all of them is maintaining the seller’s dignity and peace of mind. We have heard too many stories of families having to leave their homes because of a Sheriff’s order or some other type of legal action. The short sale process alleviates this negative social impact. The process puts the control back in the seller’s hands so that they can get back on the road to financial recovery and start providing for their families. In the battle of the two evils, a short sale always wins!!!

You want to buy and you have heard that home prices are really low and there are some good deals out there with all the foreclosures and short sales.  Perhaps you have also listened to some scary advice from TV financial pundits who are saying not to buy right now because prices are going to drop even more . . .and the economy is in bad shape, and Wall Street isn’t doing so well, yada, yada, yada.  Here are some things I want you to keep in mind:

1. The real estate market is LOCAL!  National TV personalities are speaking to the whole country and can’t possibly say anything worthwhile for any particular local market.  Also, they are there to get ratings and if they can say things that are inflammatory and perhaps controversial (like one who I won’t name who told people to stop making payments on their mortgages – yikes!) more people tune in and the networks are happy.

2. Home prices may or may not come down – no one really knows that for sure.  What I do know – home prices are the lowest they have been in years.  It’s like a clearance sale at the mall!  In time prices will go up – how do I know this?  Because history is a good yardstick and historically the price of homes is up/down/up/down/up like a wave.  It makes much more sense to buy when the prices are low – not when they are high!  Problem is, if you think you can time the market, you won’t know when it has hit bottom until it starts going up again – by then it will be too late to get the lowest price.

3. Mortgage rates are at jaw-dropping historic lows.  This is the one single most important factor in home affordability.  With rates this low, buyers have incredible purchasing power.  You should know that for every 0.125% rise in the interest rate, the purchase price will drop by 1.45% to keep the same monthly payment.  Wow.

So tell me now. . .why are you waiting?

Contract Pending

$399,000
3 Bedrooms and 2.5 Bathrooms

Updated home with new carpeting, ceramic and hardwood floors.  Main level master suite, formal dining room and gorgeous kitchen – new cabinets, granite counters, ceramic floors, new appliances.  Four garages (one attached and detached 3-car oversize garage with workshop).  Super lot, landscaped, garden, two level deck with hot tub hookups, tennis court.  Private yard surrounded by trees.  Circular drive.  Full, unfinished basement ready for your special touches!  Close to Ft. Meade, NSA, NASA.  Easy commute to Baltimore, Washington D.C., Annapolis, Columbia. HORSE OWNERS – super boarding facility at Dairy Farm only 5 minutes away with 860 acres of riding trails!

Ground Rent, Fee Simple and Condo are real estate terms that describe the type of ownership for a property.  Here is what they mean:

• Ground Rent - is where you own (or purchase) the building but you don’t own the land.  In essence you “rent” the “ground” from someone else who has title to the land.  Although this form of ownership goes back to Roman times, in the Baltimore area it was started in 1632 when Lord Baltimore charged rent to colonists who wanted to build on his land.  It is still used sometimes today to help keep the costs of home ownership down.  Most commonly seen in the city, ground rent can be found in Howard County and other local jurisdictions as well.  When a home is listed for sale, the amount of ground rent must be disclosed along with the cost to redeem the rent.  The amount of ground rent varies greatly and can be as low as $50 per year.  If the ground rent was created after April 8, 1884 it may be bought from the owner at a rate determined by the State.  After the ground rent has been redeemed, the property ownership becomes “fee simple.”
• Fee Simple - is where you own the land under your home (technically the footprint all the way down to the center of the earth and all the way out into the universe to infinity).  So, you may be thinking, “hey, if I own the space above my home then I can declare it a ‘no-fly’ zone to jets and other aircraft.”  Actually, you do own that space but it has a permanent “easement” that allows aircraft to use of the air over your home (and satellites to use it to orbit the earth, for that matter).  On the other hand, if your neighbor owns the property to either side of yours and wants to build a bridge over your house so they don’t have to walk across your yard, they can’t do that. . .unless you give them an easement to use your space, of course.
• Condo – is ownership of the common areas in a Planned Unit Development (PUD).  Sometimes condos are single level units in a multi-floor, multi-unit building.  Other times they multi-level homes that look just like townhomes.  With condo ownership, you and every other home owner in the PUD owns the common areas – walkways, grass, gardens, building exteriors, roofs, etc.  Your individual deed is only for your unit and the airspace that it occupies (even if you have the ground level unit, you don’t own the land underneath it exclusively – everyone owns it in common).  Typically with condos, there is an extra “condo fee” paid by every unit owner to cover maintenance and upkeep of the common areas as well as a master insurance policy for the entire PUD.

For general information about ground rent visit: LiveBaltimore.

Prior to 2007, ground rent was something of a mystery to many homeowners who were subject to the rent but didn’t know who to pay it to or how much to pay.  Often the homeowner wasn’t even aware that they had ground rent.   A spate of lawsuits were filed by ground rent owners who were evicting families from their homes for non payment of the rent.  In 2006, reporters from the Baltimore Sun uncovered and brought to light what had been a secretive business where nearly 4,000 lawsuits had been filed against homeowners since 2000.  To read more about their investigative reporting on the topic visit: Baltimore Sun.

Laws were put in place that required ground rent owners to file in a registry or risk losing their rights to collect ground rent.  Now able to identify the owner of their ground, homeowners can redeem their ground rent if they chose to do so.  For information on how to redeem your ground rent visit: http://www.dat.state.md.us/sdatweb/ground_rent.html