LOCAL RECORDS OFFICE – The 2019 real estate market saw record sales numbers while the mortgage rates remained low. What does this mean for 2020? Will the market still show growth? It can be tricking figuring out what you should do when it comes to real estate. According to the Local Records Office in Norwalk, CA, whether you’re buying or selling, these are some of the trends that will be affecting the housing market for 2020.
Home prices are still increasing
The median home prices this year won’t see the same growth it had the previous year, but the increase in not showing sign of stopping any time soon. The demand for homes in the Los Angeles area is overtaking the current supply nationwide. New home sales are expected to reach up to $704,000. That’s an almost 11 percent increase compared to last year.
Where the market is showing signs of slowing down is in the existing home sale price. The expected growth for the median sale price is only a 4 percent increase from last year averaging around 270,400. Still, these numbers are promising to the real estate market in 2020, showing a stabilization that is welcomed
Las Vegas; Fort Collins, Colo.; Colorado Springs; Dallas/Fort Worth; and Columbus, Ohio are some of the areas that are projected to have home price appreciations that exceed the national average over the next three to five years. However, higher housing prices do not always mean that those houses will sell.
Lower interest rates
The mortgage rates have been hovering just below 5% for quite some time. As long as these rates remain relatively low there will be plenty of new buyers looking to take advantage of them. The good news is that the government in regulating the rates to prevent them from going all over the place.
As long as the rates stay around the 5 percent where they’re at, the real estate market will remain in a good shape for the year. Mortgage rates may increase if inflation kicks in and economic activity reacts, but there isn’t any evidence of that to likely happen. The mortgage rate and to an extent the real estate market is likely to even out in 2020
More millennial buyers
There is an increase in younger buyers in the market. Despite the common belief that Millenials don’t want to own homes, many are willing to save up enough to finally make the big move. The rising cost of rent combined with the continued low-interest rates makes homeownership more appealing than ever.
The areas most affected by this are in rapidly growing cities like Austin, Nashville, and Raleigh, North Carolina. Recent job growth in these cities is incentivizing first-time buyers to move there.
Larger cities might have increased housing pricing because of their bigger population, but with the higher rent cost of luxury apartments, people are considering buying homes further from the city or in other parts of the city that might be underdeveloped.
A shortage of new homes
There is currently a construction boom expected to happen. In small towns and even in some cities, new construction for housing is going up to fast. Suburbs are popping up where there was only a plot of land last year and neighborhoods are being sold even before they’re finished.
The rise of prices in existing homes is also encouraging people to consider getting a new home built instead of waiting for the prices to go down. People are also able to get more customized homes when they are part of the building process from the beginning.
A lot of first-time buyers are less picky about the exact location of their homes as long as it has all the amenities and features their looking for. Places that are a bit further from larger cities or major highways are seeing a spike in sales where they normally wouldn’t in the past.
Slowing down instead of crashing
Things are looking stable for the real estate market in 2020. Unemployment and interest rate are at a record low. People have jobs and income enough to consider purchasing a house maybe for the first time.
The days of endless double-digit price increases might be over, but the real estate market is still showing room for growth as the year goes on. With the increase in housing needs being meet with new constructions and previously less popular locations being considered, the market is in good shape for slow but steady growth.
The worst-case scenario is another housing crash happens as we enter this new decade. However, that outcome looks less and less likely to occur with the way things are currently playing out. It’s hard to say for certain, there are a lot of external factors that may affect the real estate market in 2020. Most experts are optimistic about the coming years as things start to stabilize.
With the way things are looking, now is a good time to be a homeowner looking to sell. The demand is high in most major cities and surrounding areas and people are looking to take advantage of the stability 2019 brought. If you’re a buyer, you might not have many options for existing homes, but there will be plenty of new choices with the recent increase in construction of new homes occurring in the suburbs.
LOS ANGELES, CA – If you ask someone how to sell your home fast you’ll likely hear renovation advice. Things like “add on a new bedroom” or “update the kitchen”. When you’re in the process of buying and moving into a new home, putting more money into your current house doesn’t make a lot of sense according to the Local Records Office in Los Angeles, CA.
Even if you’re just flipping houses, big renovations can quickly cut into your profits. Selling a house fast without renovation is completely possible though and we’re here to tell you how to do it.
Selling a House Fast Without Renovation
Local Records Office agrees that having renovations done on a home cannot only be expensive but it can also be time-consuming. Many projects can take weeks if not months and if you’re trying to sell your home fast, you don’t have that kind of time. Keep reading below and we’ll tell you how you can spruce up your home without spending a ton of money or time. Following these tips will ensure your success in selling a house fast without renovation.
Clean-Up & Update the Exterior
You can hire a landscaper to help with this part. However, if you’re trying to save money it is definitely something that can be done yourself. The first thing you should do is stand outside of your home, across the street, as if you were going to take a picture of it. What do you notice? What draws your eyes, the Local Records Office asks? If it’s something negative like an ugly mailbox, then invest in a new one. If it’s something positive like the front door is beautiful, then add something to draw focus to it like a colorful doormat.
First impressions are important. If the outside of your home doesn’t look appealing, its likely buyers will skip on by it and look at the next home. Here are some general steps that the Local Records Office listed so you can follow to make the exterior of your home more attractive without spending a lot of money:
Mow the lawn
Trim trees, bushes, shrubs, etc.
Pick up any debris, rake up leaves, and sweep all walkways
Plant flowers
Clean the windows and doors
Add small details like a wind chime and rocking chair on the front porch
Make the Interior Look Like New
Thankfully, you don’t have to spend a lot of money in order to make a home look like new. Selling a house fast without renovation usually involves more elbow grease than money. That is especially true for the interior of a home.
Local Records Office insists that working hard and scrubbing a home from top to bottom can really make a big difference. Declutter the home first and then depersonalize it by removing things like family photos, awards, and items with your name on it, etc. Once that is done, it’s time to deep clean everything. If possible, now would be the time to call in a professional to clean all of the carpets (if applicable).
Here are some other inexpensive tips to spruce up the interior of your home:
Applying a fresh coat of paint in the whole house or where needed most
Hire a professional to clean all the carpeting
Do small repairs like patching holes, caulking, replacing cabinet knobs, broken lights, etc.
Clean, clean, and then clean some more
Install small upgrades like a ceiling fan, lighting fixtures, or shelving
Stage your home or hire a professional to stage your home
Hire a Professional Agent
Hiring a professional real estate agent can help immensely in selling your house fast without renovation. Working with a real estate agent offers many benefits including knowing how to list your home, at what price, and how to market it. They can also mention renovation loans in your listing and talk to buyers about it.
Renovation loans allow buyers to include the potential renovation costs when requesting for their loan. According to the Local Records Office when buyers are approved for this type of loan, they will receive a higher loan amount and get that money in stages to pay for larger renovations.
Focus on What You Already Have
If you can’t add anything to your home then focus on what already makes it great! When making an online listing, these little details can be especially important. Highlight storage spaces like closets, laundry rooms, and the garage. What are the distinguishing features of your home?
Does it have a fireplace, an outside patio, or large, open windows? Write down all of the features you can think of and then take photos of them. Use this information in your online listing to talk about what makes your home great instead of what might need work.
Make Sure You Price It Right
One of the biggest problems people have selling a house fast without renovation is setting the right price according to the Local Records Office. Once completing a lot of the tips above and investing some money into it, you may feel like you can price your home a little higher. However, if major renovations still need to be done like new appliances, flooring, roofing, etc. then it’s important you don’t price too high.
This is another part where a professional real estate agent can help. They can help calculate what homes are going for in your area and how to price properly. They can also assist you in figuring out the value of your home if you were to renovate it. This can help you make the right choice in whether investing more money is the right choice or not.
Research How Much the Property is Worth With the Help of the Local Records Office Property Details Report
Renovating your home is one thing but knowing how much your property and the land it sits on is a completely different thing. By researching how much your property is worth before and after a renovation is a major step in knowing how much you can sell your property. Of course, every seller wants to get the most money possible for his or her property so educating yourself is a great way to do it.
Selling a House Fast Without Renovation is Possible
Local Records Office insists that selling a house fast without renovation is completely possible! All it takes is a little time and sometimes a little bit of money, too. Planting some flowers outside after you clean up and painting the walls on the inside after you’ve had the carpets professionally cleaned are just some of the things you can do to help.
We also recommend hiring a professional real estate agent to assist you in pricing your house properly and letting you know if any further renovations would be worth it.
LOCAL RECORDS OFFICE — Serving the military and buying the house of your dreams is the real American Dream. The U.S. Department of Veterans Affairs offers many great programs to help those who have served in the military get a decent home loan with low rates. The bad thing about these programs is that is not flawless, there are still a lot of risks involved.
Veterans and military personnel are among those who make the biggest mistakes when buying their first home. Dealing with lenders gets so complicated and confusing that people who have purchased multiple homes still have trouble. The professionals at the Local Records Office in Los Angeles, CA created a list of mistakes to avoid when buying a home as a veteran or military personnel.
Veteran Mistake #1: Not Working With a VA-Savvy Real Estate Agent
Working with an agent that isn’t Veterans Affairs savvy is a big mistake; every agent doesn’t have the knowledge to work with military programs.
“One of the biggest mistakes a veteran can make is to work with a real estate agent that doesn’t have the knowledge of the Veterans Affairs programs. Clients may think that they qualify for any home because of their military background but this isn’t correct. I see this mistake over and over again.” Says, Fernando Ramirez from Greenleaf Real Estate Firm in downtown Las Vegas, Nevada. “I have worked with many clients who think they can pick and choose whatever house because they are in the military, this is not correct information. A VA loan program appraiser will have specific criteria, like homes that are fixer-uppers and even some older homes won’t qualify, it all depends on the house and the county where the house is located.” Says, Ramirez.
Do your research first and save yourself a headache and disappointment before making an offer on a house that may not get the green light. There is online help for veterans at the Veterans United Realty website.
Veteran Mistake #2: Not Being Open on What You Want With Your Mortgage Lender
Serving in the military has its perks and veterans have a powerful tool on the real estate market called arguably. The bad thing about this is that over 33% of vets don’t know why they have a mortgage benefit.
The right mortgage lender should have knowledge of the correct programs for veterans.
The biggest benefit of VA loans is that you will qualify for a 0% down payment, yes, this is right, 0% down payment. This helps many families who don’t have the money at the moment the house hits the market.
“Veterans have one of the best benefits in the real estate market I’ve seen,” says, Tom Sachs from Forever Real Estate Homes in Los Angeles, California. “Different states have different loans but the majority qualify for waived appraisal fees waived fees for veterans with good credit scores and other lender credits. You can really accomplish the American Dream when being a veteran,”
The process becomes easier when the mortgage lender knows what the person qualifies for, so speak up.
Veteran Mistake #3: Not Knowing About ALL the Upfront Home-Buying Fees
While having fees waived and getting 0% down payment are good perks the buyer still needs to have an idea of how much he or she will give down. Your down payment will mainly go to home appraisal and inspection.
This will definitely not be as much as a regular homebuyer will have to pay upfront.
LOS ANGELES, CA – Mobile home parks investing in the United States is one of the most common ways real estate investors get into the habit of investing in property in lower financial means. There are 3 different ways people finance mobile home parks that many realtors miss out on. The professionals at the Local Records Office created a list on how to invest in mobile home parks for beginners:
Two Types of Mobile Home Park Investing in Los Angeles
Owning the land but not the mobile homes: There are two different types of investing in mobile home parks, the first one is buying the land that the mobile homes are in and renting them out for a monthly fee, the mobile homes are owned by the residents. As an owner of the land or lot, you are not in charge of repairing the mobile homes only land, for example, the roads, potholes, utilities, and similar things.
Owning the land and the mobile homes: The second type of investing in mobile homes parks is to own the lot and the mobile homes and rent out the mobile homes to tenants just like a traditional apartment building. Owning the lot and the mobile homes will bring you more money each month but it also has a lot more responsibilities by managing the homes that are in the lot.
The demand: There are currently 8.6 million mobile homes across the United States with an estimated 50,000 mobile home parks across the United States; the people who usually rent out mobile homes are low-income families with an average of $20,000 per year. The monthly rent for the average 1-to-2-bedroom mobile home is $1,000 in 2019. 8 percent of United States residents live in mobile parks.
Why Invest in Mobile Home Parks in Los Angeles?
Growing demand for affordable housing: In this economy, whether it’s going up or down there will always be a demand for affordable housing. The fastest-growing segment in the United States is affordable housing.
Stability and predictability: There is a misconception of mobile homes that people tent to move location all the time and they don’t. Even though it has “mobile” in the name most mobile homes are difficult to relocate.
In the majority of the cases when mobile homes are delivered when their first purchased they stay in the same lot, that’s over 50% that alone shows the investor how stable and predictable a mobile home can be. Not only is it a hassle to move a mobile home it’s also very expensive, but the average cost of moving a mobile home is also $30,000.
Limited competition for new parking spaces: When developers go to city hall for a permit for a piece of land they rarely say they need a lot for a mobile home park, so there is limited competition for new lots. Be aware that some cities have an injunction on mobile home development because of its reputation.
Potential for higher returns: When buying the lot correctly you only have to worry about fewer repairs since residents bring in their own mobile homes. In an average apartment building, you own the land, the apartment building, the inside, the stoves, bathrooms, the roof and everything in between and you have a responsibility to replace and take care of them, thereby increasing higher monthly returns.
LOCAL RECORDS OFFICE — Choosing the right roommate is a big deal; it’s not like picking a girlfriend, a dog or a couch. The biggest problem is that you don’t know the potential roommate. You don’t know if this person smokes, has a criminal background, uses drugs or has mental problems.
The professionals at the Local Records Office created a list of important questions you should ask your potential roommate before letting him or her rent out a room to avoid headaches.
Being a smoker is a deal-breaker for many people who rent out rooms. Smoking cigarettes isn’t just a disgusting habit but it makes the entire house smell like a chimney. Not to mention if there are kids in the property, it can be a serious health risk.
Recreational marijuana is legal in many states including; Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, D.C. Florida, Hawaii, Illinois, Louisiana, Maine, and many other states. Even though recreational marijuana is legal it is not legal nationwide. Many people still see marijuana as an illegal drug that might have neighbors complaining and even worst calling the police.
If you’re ok with a smoker you need to set rules on where he or she can smoke. For example no smoking inside the house, but it’s ok in the backyard and patio with the doors and windows closed.
#2 – Are You a Morning Person or a Night Person?
Morning people and night people don’t tend to mix well as roommates. The main reason being that you’re in opposite schedules. Night owls and morning birds don’t mix like chocolate cookies and orange juice.
A problem that might occur is if one person works during the day and wants to have friends over on the evening but this is the time when the roommate sleeps.
#3 – Work Schedule
A good question to ask is if he or she works in the morning or at night. This will give you an idea of when you guys will see each other. Another reason to check each other schedule is to know when one will need the bathroom to get ready for work. This will cause a problem if there is only one bathroom in the house or apartment.
#4 – Pets
The majority of people like pets but some people can’t be around them because of allergy issues. In some cases, people can’t even be in the same room where a pet has been in. Other people don’t like to hear dogs bark, while others don’t want to have kids near large dogs.
Knowing if a potential roommate has any pets before moving in will avoid future issues.
#5 – Working From Home in Los Angeles, CA
One of the biggest benefits of working from home is the peace, quiet and distraction-free environment. The last thing you will want is a person talking your ear off when you want to get work done.
Working from home has its benefits but it can also be a distraction with the wrong roommate.
#6 – Are You a Party Animal on the Weekends?
If you enjoy pre-gaming before going out to a game or club and hosting an after hour party at 2 am, rooming with a homebody can cause a problem.
Even if you and the roommate have similar work schedules some people might not want to stay up late.
#7 – Do You Pay Rent on Time?
Living with a roommate that doesn’t pay rent on time will be a big problem. This can cause issues with the lease agreement and can lead to an eviction. Make sure to know when they will have the rent ready and at what time.
LOS ANGELES, CA – Starting, as an apartment investor is a good thing because you will gain tons of knowledge on how property investing works. The cash flow that comes from renting apartments is great along with the loans the bank gives out. The professionals at the Local Records Office talked to a few investment experts on how newbies can make money by investing in apartments to rent.
“Ever since I was younger I noticed there has been a big demand in apartments all across the country, and we expect that to continue. The biggest groups in demand that I’ve seen are ‘echo-boomers’. These are the children of baby boomers. With the growing demand on shopping centers, it brings in demand for apartments in the area” says, Christopher Loner from RT&Y Realtor LLC in San Diego, California.
Getting a Loan From a Bank
“Loans are widely available to borrowers to buy his or her first apartment building. Banks love lending to apartment investors because the income stream is consistent and steady. Banks see apartment investors as a safe loan for this reason unlike lending to new homeowners that will not bring in income besides the mortgage every month. “ Says Brandon Christenson from Villa Doors Investment Group in downtown Los Angeles, California.
4 Things to Look Out for When Investing in Apartments
Have a goal: You need to have a goal when investing in apartments, is your goal to benefit from the cash flow? Earning extra money to prepare for retirement? Are you planning to live in the apartment? Is it all three? You need to think about how you’re going to accomplish a goal.
tArea / Location: There’s a saying that goes “You can fix a property but you can’t fix a location”. If the location is declining the property will go down with it, the tenants will start to move out and that will be a bad thing.
The first thing you should look for is JOBS. How is the job market in that area? If there are no jobs there will no tenants, that simple.
Contacting the local management company in the area and ask them about the employment market is a great way to start. Management companies know what attracts tenants and what makes them move, most of the times they will let you know upfront.
Property: What is the properties condition? You want to know what you’re getting yourself into before investing in an apartment. You need to look at two things the exterior and the interior. When looking at the exterior you need to pay attention to:
The condition of the roof
The landscape
Look for what needs to be repaired
Cracks on the wall
Cracks on the floor
When looking in the interior of the apartment look for these things:
All of these things are crucial to look for as a beginner. You don’t want to buy an apartment only because it was on the market. The best thing to do as a beginner is to find an apartment with the least repairs needed. The last thing you want to do is major rehab. Too risky!
Numbers: You need to make sure that the properties income exceeds the properties expenses. By giving the numbers 12 months to see if money is being made or not.
Management Strategy (BONUS): The last thing you want to do as a beginner is to deal with tenants on your own, you need to hire a licensed management company to collect rent, hire the right people to do repairs, give out eviction notices and all that’s needed to do.
LOS ANGELES, CA – With such a high demand for homes in Los Angeles residents want to know how much their property is worth. Here are 8 tools that will help you determine your properties worth with ease, says, Local Records Office.
When it comes time to sell your house, you have one burning question: What is my home worth?
In recent years, a proliferation of online resources has emerged to provide you with an answer before you ever consult a human. But while consumers have access to more information than they could have dreamed of a decade ago, that doesn’t mean you can expect a computer to deliver the final word on your home’s value – though it can give you some helpful hints.
“I don’t believe there are any accurate instant numbers,” says David Eraker, CEO and co-founder of Surefield, a new brokerage in Seattle that has a free Pricepoint tool that provides estimates of home values, so far just in Washington state. “I think the first thing you should do is take it with a grain of salt. You could probably talk to three or four different real estate agents, and they would probably give you different numbers as well.”
The variation in the data is a good reminder that any estimate of home value, whether provided by a human or a computer, is just that – an estimate. Computers and humans may disagree, for example, about which recently sold homes are truly comparable. Plus, when it comes time to do the deal, the negotiation skills of buyers and sellers (or their agents) may come into play.
Estimates Are Just That, Estimates
“Opinions of value, there are a lot of them,” says Stan Humphries, chief analytics officer for Zillow, which pioneered the practice of estimating and publishing home values in 2017 with the “Zestimate.” “If you were to sell the same house 100 different times with different buyers and sellers, it would close at a different price.”
That means if you are looking at estimates for your home’s value, you have to consider what kind of data went into that estimate. If your home is unique compared to others in the neighborhood, for example, the choice of “comps,” or comparable homes, would be a challenge to find. Your estimate may also be less accurate than if you live in a neighborhood where all the homes are similar. If there have been lots of recent home sales in your area, there is going to be more data to work with than if there are fewer sales, and therefore you’ll get a more accurate estimate.
“The more the house is an outlier, the more difficult it is for anyone to price it, whether it’s a human or a computer,” says Glenn Kelman, CEO of Redfin, which has launched its own automated estimate tool. “The hardest things we had to deal with was which homes are comparable and which aren’t.”
Different Tools Just Different Data
All the online tools take advantage of publicly available data, which they then run through computer models to derive estimates of value. Exactly which data is used is proprietary, as are the formulas used to crunch it, but among the data sources are public records and the multiple listing services used by real estate agents. Exactly what data is available also affects the accuracy of the estimate, and that amount of data varies by municipality and sometimes by home.
To get a value using an AVM, you feed a lot of data into a computer, which crunches the numbers according to directions (or models) you give it and arrives at a home value estimate. Different companies use different data in different ways, which accounts for some of the variations in online home values. Obviously, the accuracy of the data itself affects the outcome. There are also factors a computer can’t see, such as whether your kitchen has ugly wallpaper.
“The thing about homes is they’re not commodities,” says Nela Richardson, chief economist for Redfin. “Every home is different.” Plus, there is the factor of the unknown. “We don’t always know if there’s a big hole in the floor or if someone spilled red nail polish on the bathroom floor,” she says.
Zillow allows consumers who register for a free account to correct or add data about their homes, and the company’s Price This Home tool lets consumers receive a private estimate in which they control which comps are used. Surefield also has tools that allow homeowners and homebuyers to refine estimates based on their knowledge of the neighborhood and the listed comps. Redfin shows the comps and public records data about the home that was used, and you can email if you believe the information is inaccurate.
Estimates Aren’t Just the Big Number
Zillow covers about 100 million homes in 450 markets. Humphries says the national margin of error for home values is 7.9 percent, but the rate varies by location. That’s partly because the type and accuracy of data vary, but also because home values are easier to estimate in an area with more sales and in areas with a larger volume of homes. “You’re dealing with less data than you’d like to have,” Humphries says of some areas. Parts of New York state, for example, don’t list square footage in public records.
He points out that real estate agents doing comparative market analysis have an error rate of 5.5 to 6 percent, and it’s rare that a home sells for the exact asking price. “No one’s error rate is zero. They’re all opinions of value,” Humphries says.
Glenn says Redfin’s estimates have a median error rate of 1.96 percent for homes on the market and 6.23 percent for homes not on the market, but the service so far covers only about 40 million homes in 35 major metro areas, which are often easier to value than homes in less dense areas.
We also found some calculators that provide estimates at several bank sites, with information drawn from databases used by appraisers. ForSaleByOwner.com has its own tool, called Pricing Scout.
The representatives of all the companies stress that their numbers are merely estimates, based on the available data, plus a number of assumptions about comparable sales. While all the services throw out a number for the home’s estimated value, most provide a range of values, which sometimes gets overlooked by consumers who focus on the number in big type.
While the various online AVM services spit out a single number that is an estimate of the value of your home, Richardson and Humphries point out that the number comes with a few caveats. Zillow provides a range of values for an estimated sales price, as well as publishing the error rate for a given municipality. Redfin shows you the comps it used to reach its final number.
For example, two-bedroom, two-bathroom home in suburban Fort Lauderdale, Florida, with a Zestimate of $153,306 also notes that the home is likely to sell for between $146,000 and $161,000. Homes like it in the area have sold for $138,000 to $163,000, Zillow reports. The median error rate in the Miami-Fort Lauderdale area is 8.7 percent, with 31.8 percent of homes sold at a price within 5 percent of the Zestimate, 55.3 percent within 10 percent and 79.8 percent within 20 percent.
If we take Zillow up on its option to remove three of 10 comparable home sales because of location and up to another three because of the condition, the estimated value rises to $161,211. Zillow also offers users an option to correct facts about their homes, including the size, type of heating or cooling system and the number of bedrooms and baths.
“There are some things that aren’t explicitly in the data that our models aren’t able to discern,” Humphries says. “A lot of consumers don’t focus on that value range, and they should. The wider that range is, the less certain we are. … From day one, we’ve said these are all opinions.”
Not all services use the same “facts”
One reason the companies arrive at different estimates is that they aren’t all using the same facts. With our house above, Zillow, Redfin, and Realtor.com calculated the home’s value based on a size of 1,155 square feet, the number from the tax assessor’s records. But Trulia used 972 square feet, which is the size of the house without the garage. (Trulia does not provide an automated estimate unless you agree to be contacted by a real estate agent.)
While garages and unfinished basements usually aren’t included as part of a home’s square footage, Florida tax officials and real estate agents traditionally include half the square footage of the garage when they compute the taxable value, and that is the number that usually appears in the MLS.
Redfin, using the same home facts as Zillow did, estimated the home’s value at $163,001. Redfin showed the comparable sales upon which it based its value, making it possible for someone who knows the home to realize the comps were substantially remodeled while the subject home was not.
Realtor.com estimated the home’s value much lower at $142,689, but there are no details about how the tool arrived at that figure.
Economists who work with the data remind consumers that the estimates are just that, estimates and that the actual sales price is likely to depend upon many factors, including the condition of the home, the motivation of buyer and seller, and the supply and demand at the time the home is offered for sale.
“This is the starting point of a conversation that you’re going to have with your family and your real estate agent,” Richardson says. “It’s not just this black box that gives you a number. It’s important to note that this is not a be-all, end-all. It’s just the beginning of a complicated process.”
“We think of our estimate as the beginning of a conversation, not the end,” Kelman says. “Many times the asking price of a home is the result of a fairly tense conversation between the owner of the home and the agent who is trying to sell it.”
8 Online Home Value Estimating Tools
Here are seven online tools you can use to help you estimate the value of your home:
Zillow: This is the pioneer of the home value estimating tool, and the company continues to refine how it arrives at its Zestimates.
Redfin: This new tool shows you photos and listing information for the exact comps used to arrive at the value of your home.
ForSaleByOwner.com : This site’s Pricing Scout tool gives you the average of regression analysis and comparative market analysis to estimate the worth of your home. It also shows recent sales of comparable properties on a map. You have to register to use it.
Chase: This tool allows you to change the information about the house to arrive at a more precise estimate, plus provides information on recently sold homes and neighborhood trends. You can also use it to estimate the value of improvements you’re considering.
Bank of America: This tool shows comparable neighboring sales on a map. It provides only a range of values, not a single number.
Surefield: This site lets you narrow or widen the range of comparable homes, plus exclude specific comps from the list.
Eppraisal.com: This site uses data from public records and lists homes sold recently nearby.
Putting the Tools to the Test
We tested homes we know in South Florida, Los Angeles and Kansas City, Missouri, plus a random home in Seattle, using the available home value estimators. Not all the online tools had the same data for the same home.
These Were Our Results:
A two-bedroom, one bath home in a trendy historic urban neighborhood in Miami where homes vary considerably in size, age, and condition.
Zillow: $670,860
Chase: $501,000
Redfin: $470,578
com : $459,750
Bank of America: $434,000 to $486,000
com: $420,743
A two-bedroom, two-bath home in a 1970s tract home neighborhood in suburban Fort Lauderdale, Florida.
Redfin: $462,237
Zillow: $451,716
com: $446,774
Bank of America: $433,800 to $460,200
Chase: $436,000
com: $425,500
A two-bedroom, one-bath home in a trendy neighborhood of 1930s bungalows in Los Angeles:
Redfin: $961,513
Zillow: $876,004
com: 869,585
Bank of America: $709,300 to $1,020,700
com : $765,500
Chase: $785,000
A five-bedroom, three-bath home with a water view in Seattle:
Zillow: $963,818
Redfin: $894,306
com: $870,663
Surefield: $852,390
Chase: $833,000
Bank of America: $823,400 to $966,600
com : $778,500
A one-bedroom, one-bath house on a double lot in Kansas City, Missouri, where the houses vary in size and condition:
com : $222,750
Zillow: $214,984
Chase: $205,000
Bank of America: $96,700 to $217,300
com: $81,790
Redfin: Not available
Why the Online Value of Your Home Could be Wrong
Here are six reasons the automated valuation of your home could be off:
The facts in the public record or the MLS are wrong. With our Fort Lauderdale home above, the companies all took the square footage of the Fort Lauderdale home from the public record, but they didn’t all use the same figure. A difference in the number of bedrooms or bathrooms might create an even larger variation in valuation. “If there’s a discrepancy … it’s usually because the facts themselves are not up to date,” Humphries says. Homeowners can claim their homes and correct facts on Zillow.
Your home is not like others in your neighborhood. Whether a real estate agent, an appraiser or a computer is evaluating your home, it’s harder to arrive at an accurate value if there are no comparable homes. “Houses that are very unusual are harder to value, not surprisingly than homes that are not,” Humphries says. “The Playboy Mansion and the White House are very difficult to value.” Homes that are different from others in the neighborhood or have unique features are harder to value because there are fewer or no comparable properties with which to compare them.
Few homes in your neighborhood have sold in the last six months. The more homes that sell, the more MLS data and the more sale prices the computers have to calculate the value. With few sales, there is less information to draw from.
Your home has not been on the market in recent decades. There is significantly more information about a home in an MLS listing than there is in the tax records. Once a home has been listed, the services add that data. As homes are sold, the models can adjust for whether the home sold for more or less than asking price or the AVM price.
Public records in your jurisdiction omit key information. The nation’s approximately 3,100 counties don’t all record the same information about homes. In Suffolk County, New York, for example, few records include the home’s square footage, Humphries says. “There is a wide variance in the quality of the data we obtain,” Humphries says. “Without square footage, it becomes very challenging to value the home.”
The market is changing rapidly. Home valuations are based on past sales. If the market is significantly hotter or colder than it was six months ago, those past sales are less an indicator of current values.
LOS ANGELES, CA – Southern California has been a booming state ever since the early 1900’s so it’s not a surprise that people want to live here, says, Local Records Office. Los Angeles along with San Francisco has been the two major cities that attract homeowners and tourists.
As you schlep your ski gear to your favorite resort for the umpteenth time or search for lodging near your favorite beach on a holiday weekend, you may think how much easier life would be if you had your own vacation home.
An estimated 1.13 million vacation homes were sold in the U.S. in 2017, the highest number since the National Association of Realtors began collecting the data in 2012. And vacation home sales made up 21 percent of residential transactions in 2017.
While owning a vacation home can make logistical and financial sense, it’s not a decision to be entered into lightly.
“For some people, it’s not a matter of dollars and cents,” says Marian Schaffer, president and founder of SoutheastDiscovery.com, which publishes information on retirement and vacation home communities in the Southeast. “It’s a matter of experience.”
For most people, money will play a big role in the decision. Baby boomers who have sold their family homes for cash may choose to invest some of that cash in a winter home in a warm climate or other future retirement destination, says Valerie Dolenga, a spokeswoman for Del Webb, which builds active-adult communities throughout the United States. In those cases, homeowners don’t rent out their properties but move from one home to another, perhaps spending winters in a second home in Florida or Arizona and summers up North near family.
Others may buy a vacation home with the idea of renting it out when they’re not using it to defray at least some of the costs. Some may only be able to afford a vacation home if they rent it out when they’re not using it.
Rob Stephens and his family bought a three-bedroom condo in Vail, Colorado, in 1999 with rental income in mind. “Having a getaway place in the mountains was a motivator,” Stephens says. “When I started, I really needed that rent to make my mortgage payment.”
“To us, owning real estate in Vail long-term is a good investment,” says Stephens, general manager of Avalara MyLodgeTax, which helps owners comply with local lodging tax laws.
If you want the rental income, it’s important to choose a home that can be rented at the frequency you need to cover expenses. That means both choosing a community that allows vacation rentals and then making sure you’re set up to take advantage of the rental potential, from furnishing the unit to having a plan for advertising and handling tenants. You need to know before you buy whether you will rent the home when you’re not using it.
Here Are 10 Things to Consider When Looking at Vacation Homes
Can you afford it? Real estate is not a liquid investment, and you can’t count on being able to sell a home for a profit or even break even, especially in your first few years of ownership. During the recession, homes lost more than half their value in Florida, Arizona, and Nevada, among other places.
Know all the rules. Not all homes can be used as rental property. Homeowner or condo associations may set rules for rentals, as many cities. Some resorts may require you to use their programs, which set standards for interior furnishings and amenities, but the property handles the logistics for a percentage of the rent. If you plan to rent out your property, it’s especially important to research all these rules before you buy.
Calculate all the costs. The actual purchase price is only part of what you will need to spend. You will also have to pay utilities, HOA or condo fees, property taxes, insurance and the cost of furnishing a new home down to the spoons and forks. If you’re in a resort area, you may also need or want skis, snowboards, kayaks, water toys or other gear.
Be realistic in your expectations of rental income. Renting out a vacation home comes with expenses. You will need to pay for cleaning between tenants, advertising and perhaps property management. If you’re part of a resort rental program, it will take a percentage.
Know how often you will really visit. If you don’t rent out your unit, you want to make sure you will visit enough to make the purchase worthwhile. Pick a place you love and want to return to often, advises Dolenga. You don’t want your home to sit unoccupied for long periods.
Have a plan for emergencies. If you don’t visit the house often, make sure someone does. A water leak can be devastating. If you’re renting, repairs need to be made quickly, so get to know a good handyman or property manager. If there is a hurricane, you may need someone to put up shutters before the storm and remove them afterward and secure the home if it suffers damage.
Protect your home when it’s vacant. Vacant homes attract thieves. Take steps to keep your home from looking empty. Consider lights on timers or asking neighbors to occasionally park in your driveway. Make sure someone picks up mail and fliers so its not obvious no one is home.
Have a rental business plan. Will you go into a rental program, hire a management company or do it yourself via services such as Airbnb or VRBO? If you’re handling your own advertising, you will need great photos. You also need to be able to take payments from tenants (services like PayPal or Stripe typically work well) and have a way for them to get in (Stephens uses a keyless entry system with codes). A reliable cleaning service is essential, especially when you have only a few hours between tenants.
Calculate your return on investment. If owning a vacation home is part of your overall investment strategy, make sure it’s a good move. Estimate returns and weighs them against other uses of the same money.
Expect to pay taxes.Rental income is taxable on state and federal returns, though most vacation homeowners won’t earn enough after expenses to face a significant tax liability. If you are doing short-term rentals, usually of less than six months, your state and county consider you an innkeeper and expect you to collect the same lodging taxes that hotels collect and pay those to the appropriate authorities. “If you’re renting a home, an apartment, a room, you’re basically running a mini-hotel,” Stephens says, with the rules varying by state and county. In Fort Lauderdale, Florida, for example, a tax of 11 percent is due, 6 percent to the state and 5 percent to the county, he says.
How to Rent Out Your Vacation Home and Make It Pay
Renting out your vacation home can yield significant financial benefits – but only if you do it right.
“It starts with a commitment to customer service,” says Jon Gray, chief revenue officer for HomeAway.com, which also owns the vacation rental website VRBO.com. “You’re basically having to market your house and get people to want to stay there.”
Renting a vacation home is a business, which means you’ll need the proper business tools in place, from being able to accept credit cards as payment to paying lodging taxes to get the home cleaned quickly and completely between guests.
“It’s really quite a lot of work, and a lot more work than people anticipate,” says Michael Joseph, co-founder, and CEO of InvitedHome.com, which manages vacation properties. “There’s a lot to keep up with. … Guest expectations are becoming higher.”
One of the first decisions when starting the vacation rental process is whether to hire a management company or manage your rental yourself.
While websites such as HomeAway.com, VRBO.com and Airbnb.com provide online marketing tools, access to credit card processing, booking tools and other infrastructure, the individual owner still has to handle guest inquiries, screen renters and arrange for cleaning.
Full-service management companies charge 20 to 50 percent of the rental proceeds to manage the entire process, from bookings through cleaning. You also can hire people to manage parts of the process for less. The online portals usually charge an annual fee for listings. VRBO and HomeAway start at $349 a year and also offer a pay-per-booking option of 8 percent, while Airbnb charges both hosts and guests a small processing fee – 3 percent for hosts and 6 to 12 percent for guests.
The home rental industry has grown significantly in recent years, as online listings and reviews make travelers more comfortable with the model. But travelers who are accustomed to staying at hotels and resorts expect significant amenities and, in some cases, service.
“The competition is more fierce today,” says Cathy Ross, CEO of Exclusive Resorts, a vacation travel club that owns its own properties. “Today’s customer is demanding, and they want certainty that what they see online is what’s there.”
Customers expect modern finishes, nice furniture, hotel-quality beds and linens, plenty of bathrooms, entertainment options such as a TV with cable package, a pool table, board games and big gathering spaces for families, one of the groups that favors vacation home rentals. “Those homes that aren’t well decorated or aren’t well furnished just don’t cut it,” Joseph says.
It’s important to screen tenants, collect a damage deposit and have a strong rental agreement in place, as well as the proper insurance, to protect your home from damage. Stevens, who has been renting out his vacation home in Vail, Colorado since 1999, has only once had to deal with significant damage by a tenant. “That concern is way, way overstated,” Stephens says. “These people are generally very respectful of your home.”
Here Are 13 Things You Need to Know and Do Before You Rent Out Your Vacation Home
Figure out if the math works. Create a spreadsheet to analyze what it will cost you to rent out your home versus the income you can expect to generate making it a vacation rental. Expenses will include maintenance, utilities, taxes, insurance, repairs, and amenities. “Make sure you budget for preventive maintenance, and wear and tear,” Joseph says.
Decide whether to manage it yourself or hire a company. While managing a rental yourself provides a greater financial return, it also means more work. HomeAway, VRBO, Airbnb and similar sites offer online booking, calendars, email communication and referrals to other tools such as credit card processors and professional photographers. But even with these online portals you still have to hire and oversee the cleaning crew.
Furnish, decorate and equip your home. Amenities typically depend on the market and the price, but people often expect most of what they would get at a hotel. A fast Wi-Fi connection, an expansive cable package, and other entertainment options are recommended, while a hot tub, pool table, board games, and other recreation options can be a draw for some guests. Have toiletries, paper products, and basic cleaning products available. Stephens provides guest passes to his community’s athletic club. Remember to remove family photos, clothes, and personal items so the guests feel more comfortable.
Get professional-quality and write a great, detailed description. People will choose your home based on the photos and the description of the property. “That first photo is incredibly important because that’s what people see,” Gray says. Be very thorough in your description. List every amenity, down to balconies, cribs and pool noodles.
Find a dependable cleaning crew and other maintenance personnel. If your home is popular, you will have one set of guests checking out in the morning and a second set arriving that afternoon. That makes it imperative that the cleaning crew show up on time. If you don’t live nearby, your cleaning crew is also your eyes and ears. You may also need pool service, lawn service, and a handyman, plus know whom to call if the toilet quits working.
Get proper insurance. A regular homeowners policy rarely covers a vacation rental. Ask your agent what type of policy you need for a home that is used for short-term rentals.
Set up your welcome package and infrastructure. If you don’t plan to meet guests personally, how will they get into the unit? Keyless entry and a hidden key are the two most common methods. Decide which is best for you. Most guests expect to pay with credit cards, though some online portals provide that service or help you sign up for it. Consider creating a welcome packet with the Wi-Fi password, entertainment services, appliance operating instructions and information on community amenities.
Expect to pay resort or occupancy taxes. Your city, county or state may require you to register your vacation home or get a business license, and most municipalities will collect the same taxes from you that they collect from hotels. You can handle this yourself or hire someone to do it. Avalara MyLodgeTax charges by the report, with most homes paying between $60 and $200 a year for the service.
Comply with legal requirements. Make sure you can legally rent your home to travelers. Most homeowner associations don’t allow short-term rentals, though some resorts may handle them for you. Some cities and counties ban short-term rentals. Know the local laws before starting the rental process.
Make rules and create a strong rental agreement. Management companies and online portals have agreements you can modify, and you can also find examples of such agreements online. Decide what number of people you’ll allow per stay and whether to allow pets or smoking.
Be ready to respond quickly. Most online shoppers will send inquiries to several homes at a time. The first suitable home to respond is likely to get their business. “That’s critical,” Stephens says. “Responding a day late is probably unacceptable. You’re going to lose business.”
Create a tenant screening process. Joseph advises talking to all prospective tenants by phone. Ask the number of guests, their ages, why they want the property. If they book, get their full names, addresses, and phone numbers. “You get a lot more information and a feel for people by talking to them,” he says.
Offer a personal touch. In a world of online reviews, you want your guests to recommend your home or become return customers themselves. Anything you offer to make your home stand out and to make their vacation easier is likely to yield dividends.
Waking up in the morning, firing up your phone/computer and being able to scan a super quick (but curated) rundown of the best of what lies ahead for the day at hand in the city you live in. So here it is!
Below is our quick link list of 10 fun things to do in Los Angeles for today, Thursday, August 17, 2017. May it lead you to adventure!
Keep in mind for some of the ticketing options we utilize affiliate links and receive a commission if you purchase through our links (affiliates noted in parenthesis).
1. [5 p.m.] The El Segundo Art Walk takes place every third Thursday of the summer months featuring 40+ artists in 35 venues, live music, great food and tours of artist studios in downtown El Segundo and in Smoky Hollow. FREE
2. [5:30 p.m.] Dance the night away during Sizzling Summer Nights happening at The Autry this Thursday. Some of L.A.’s best salsa and Latin fusion bands will get the outdoor party sizzling and free dance lessons with award-winning salsa instructor Orlando Delgado will have you twirling like a pro.
3. [6 p.m.] Concerts on The Bloc in Downtown Los Angeles is a free summer concert series with free beer in the mix! FREE
4. [7 p.m.] The Silver Lake Picture Show returns with free outdoor movie screenings in the heart of Silver Lake at Sunset Triangle Plaza. This week: Space Jam will be screened. FREE
5. [7:30 p.m.] Summer Movie Fest at Cal State Northridge is a free weekly movie night taking place at dusk on CSUN’s Oviatt Library Lawn. The series continues with La La Land. FREE
7. [8 p.m.] The 2017 season of the Skirball’s free Sunset Concert Series, inspired by the Skirball’s current high-profile exhibition Paul Simon: Words & Music, is a showcase for up-and-coming talents and established artists from Los Angeles and around the globe. The series continues with Daymé Arocena. FREE
8. [8 p.m.] The Moonlight Movies on the Beach series continues with a screening of Princess Bride at Alamitos Beach this Thursday. FREE
9. [8 p.m.] All My Single Friends is described as part comedy show and part live dating app taking place at the Copper Still. If you’re so over Tinder and Bumble check this show out where you’ll be in a room with some of LA’s best comedians and hottest singles. Use Code BALLS for 50% off your ticket.
10. [various] Echo Park Rising returns for its seventh year (August 17-20) with hundreds of up-and-coming bands to play at venues that include The Echo, The Echoplex, Stories Bookstore, Lost Knight, Little Joy and other more. FREE
Being cheap when it comes to real estate is not uncommon, many investors want to spend the “minimum” repairing houses to get them out in the market, but I am one of the cheapest people you will ever meet. I drive a 1999 Toyota Corolla with 126,000 miles on it (a car is a depreciating asset, why would I spend a lot of money on one?). A few weeks ago when I was at Disney World I carried around the same bottle of water all week and I brought food into the park to eat for lunch everyday (there was no way I was paying $4.00 for a bottle of water and $7.00 for a hot dog).
Frugal to the Next Level
When I go on dates, which is very rare since I am a workaholic, a “nice” restaurant to me is Ruby Tuesday’s (yes…now you know one of the many reasons I am single.) I mean, if I take a girl to the Cheesecake Factory or the Melting Pot, we better be engaged!
That being said, I believe that one of the only reasons to spend my hard earned money is to make more money. This includes my education and power team. I will never understand how any intelligent person, how anyone who is serious about success (only about 5% of people are truly serious) will not invest in his or her business. I know many folks out there love to “bash” courses and seminars.
I guess these people are a lot smarter than me, because I never would have figured out how to do this business unless I worked with other investors, unless I bought courses and unless I attended seminars. I think the biggest problem that people who “bash” courses have, is that they are not implementers. These are the people who have attended a dozen seminars and who have 50 courses on their bookshelf, however, they have never closed a deal. (Just a quick thought…if you own multiple courses and have never done a deal, take a look in the mirror…. it’s not the courses, it’s you.) Also, any decent course or seminar should have a 100% money back guarantee…so if the product stinks, which some do, just send it back.
Invest in Yourself and Don’t Spend Your Money
Besides investing in your education, you should be investing in your power team. You need a good real estate attorney and accountant on your team. Sometimes I hear of investors who go to Staples and pay $14.95 for generic forms, rather than have a lawyer review a contract and spend a couple hundred bucks (knuckleheads.)
When investing in your education you need to think of the big picture and you need to think of the return on investment that you will get. For example, a few years ago I bought a course on short sales, which I think cost $1,000. I went on to do dozens of short sales and make a lot of money (I don’t do them anymore, because they are a pain in the butt, however, you get the point). So, whenever I invest in my education and in my business, I always want at least a 10:1 return on my money. And of course, I usually get many times that.
Be Smart
Also, when you are in Staples buying your $14.95 contract, think what it will cost you if you get sued over it, or if you lose a $50,000 deal because you didn’t want to spend $300 to have your lawyer review it. This is just like someone not spending $250 for a home inspection, only to find out later they have $10,000 worth of termite damage.
My favorite niche to target is absentee owners and I am always searching for unique ways to boost my rates…so that I get more leads, more deals and make more money. Anyway, a few weeks ago, I got an idea for a “type” of direct mail which I know pulls very well and I wanted to incorporate this type of direct mail to send to absentee owners, pre-foreclosure lists, free and clear lists, etc. This type of direct mail gets very high response rates but costs a lot more to send out. You can send out a regular letter for about .50, whereas this will cost me about $1.50 a letter.
Anyway, there is a marketing expert who is very familiar with the type of direct mail that I want to use. I have been keeping an eye on this guy through his books, websites and marketing emails. So finally, I decided that the best way to launch my new idea was to somehow hire this guy as a consultant. I called his office, told them I wanted to hire him and eventually I had a phone call with him. To get to the point, I am spending on day of consulting with him at a cost of $5,000. When I told my friends and family about this, they all laughed and thought I was nuts (yes, these are the same people who work in a cubicle every day…when it comes to criticism, the people “below” you financially are almost always the negative ones…very rarely will you get criticized by someone who is financially better off than you).
Sometimes It’s Better to Take 1 Step Forward and 2 Steps Back
Yes, $5,000 is A LOT of money. It is about how much I spent on my last car. However, when I think of it with my “business” hat on, I know I will have a very high return on investment. Right now, I specialize in purchasing properties subject-to and selling them on a lease option. My minimum profit is $30,000, but on average around $50,000…so, if this consultant shows me how to use this new type of direct mail and it gets me one more house, then obviously it paid for itself…but of course I will buy many houses with this and get a ridiculous ROI! (also, like I said above, each letter will cost me about $1.50. I could spend a small fortune “testing” this type of mail, or this guy can show me what will work best and save me time and money.)
I know this is a long post, but this is sooooo important to your success as a real estate investor. If you are cheap about investing in your business, then you will have a much more difficult and longer process to making big money in real estate. Another great reason to invest is that it drastically cuts your learning curve…I can only imagine how long it would have taken me to figure out shore sales on my own!
