What Every Homeowner Needs to Know About Contractors

When you’re building or renovating a home, having the right team on your side makes all the difference.

Building or renovating a home is a complex project with plenty of moving parts. Even if you’re planning to take a DIY approach, it’s likely you’ll need some help from contractors along the way. Here’s a guide to the types of contractors you might enlist to help you complete your dream home.

General contractors

If you think of a general contractor like a general in the military, you have the basic idea of what a general contractor does. Like a general leading a military campaign, a general contractor organizes the strategy of a building or remodeling project. The general contractor decides when to bring in the plumbers, electricians, and roofers; makes sure they do their jobs correctly; and checks details, like ensuring that the carpenters install the porch handrails according to code.

Especially if there is no architect involved, the general contractor ensures that the building permits are in order and that the project is legal — meaning that it is being done to city or country building codes. (If it isn’t, your city’s building inspectors will make you redo it. Ouch!) Like a military general who is ultimately responsible for the success of a campaign, the general contractor is responsible for the outcome of remodeling project.

Subcontractors

Subcontractors are specialists who work under the direction of the general contractor. Subcontractors include plumbers, electricians, tile setters, carpenters, framers, roofers, painters and cabinetmakers, among others.

Ideally, they show up at your construction or remodeling project when they are needed. If the subcontractors are reliable and efficient, the pace of your project continues to move steadily along, and it is finished when it is supposed to be. If all that happens, it is usually because a good general contractor has been overseeing their work.

Owner as general contractor

Homeowners who are skilled at organizing multimillion-dollar sales campaigns at their office or at running three local volunteer organizations in their spare time sometimes like to act as their own general contractors. There is no law that says you can’t. As a rule of thumb, general contractors charge about 15 to 20 percent of the total cost of the job, so acting as your own general contractor can save money.

But before you leap into the general contractor role, consider whether you really have the time, expertise, and patience to run a remodeling project, especially a complicated one. How much time can you spend on site? Can you take phone calls at unexpected times of the day?

The one thing you can count on with any remodel is that something will go wrong at some point. It may not be a big deal, but it will mean making new arrangements, often on short notice, and rearranging schedules for subcontractors and suppliers.

This could mean dozens of phone calls in a single afternoon. It could mean running around hunting down some piece of hardware or building material that is needed on site right now. If this sounds like fun, you may have what it takes to act as your own general contractor.

Design/build firms

An alternative to hiring a general contractor or acting as your own is to hire a design/build firm. Design/build firms are companies that offer start-to-finish building and remodeling services. They employ architects or designers as well as the skilled builders.

A design/build firm essentially offers the services of architect, general contractor, and subcontractors. The obvious advantage to using these firms is that the entire project should be a fairly smooth operation, since the firm takes responsibility for everything.

While general contractors, subs, and independent architects can, in the worst scenarios, blame each other for mishaps and toss the responsibility for correcting the mishaps back and forth, design/build firms know the buck stops with them. They have to make it right.

Carpenters

If your home improvement project really is as straightforward as installing a wall of built-in bookshelves in your living room, your best bet is probably to find a good carpenter or cabinetmaker.

People who bill themselves as handymen may be fine at installing new light switches or doing minor carpentry, but, as always, ask to see some of their work. If you want your new bookshelves to look like elegant additions to your living room, find an expert in cabinetry.

Related:

Source: zillow.com

3 Situations Where It Pays to Buy a Fixer-Upper

You finally found “the house,” but it needs some work. Will it be a money pit or a money maker?

It’s every home buyer’s worst nightmare: Finding a house within striking distance — of your price range and work— that quickly turns into a money pit.

On the flip side of the fixer-upper experience is someone like Jordan Brannon, a director of digital strategy in Spanaway, WA, near Tacoma. Although he’s sunk considerable money into his two-story, late-1990s home, he feels it was a good investment.

“It was about finding a home that we could add value to — and could purchase at a below-market rate,” he says of his 3,000-square-foot home. But there was one crucial caveat: “The fixer-upper work that we wanted to do, we had to be able to do.”

While that fixer-upper you’ve got your eye on may not be the steal you’re expecting — the average fixer-upper lists for just eight percent less than market value, according to a new analysis from Zillow — it’s still a tempting prospect for many buyers.

Should you make a fixer-upper your next home? Here are three scenarios where the answer may be “Yes!”

When the upgrades are simple

Knowing that hiring contractors was out of the question — in part because Brannon works from home — Brannon and his wife focused on finding a home they could revamp themselves.

This meant forgoing homes with any foundation, electrical, or plumbing issues, and eyeing properties where cosmetic upgrades were the name of the game.

This isn’t to say the couple didn’t put in a lot of hard work; the project took nearly three months.

“We basically gutted the first floor down to drywall — did a full repaint, with all new trim; replaced the kitchen cabinets and countertops, and added new light fixtures and door handles,” Brannon says. New toilets and sinks are recent installments.

“The home looks 10 years younger, and feels cleaner and brighter,” Brannon remarks. “We’re more comfortable living in it, and I’m confident we’ve made an improvement in the home’s resale value.”

Combined estimates from contractors put the value of the improvements around $55,000, minus one bathroom. Altogether, Brannon says the couple spent about $15,000 on the work, plus 240 hours in labor (yes, he’s been tracking). For Brannon, it was a worthwhile endeavor.

When the numbers add up

“Fixer uppers [only] make sense as long as the numbers pencil out,” says George Vanderploeg, a luxury real estate broker with Douglas Elliman in New York. In other words, “Is the money that I have to put into it going to make the property worth at least that much when I do it?”

In general, people will price a property based on what others sell for, Vanderploeg explains. “If I were just to pick a block in Manhattan, say on 63rd Street, between Lexington and Third Avenue, the renovated townhouses there might sell for $3,000 per square foot,” he continues. “An un-renovated townhouse might sell for maybe $2,000 per square foot. If you have the money to put in, it may all work out.”

Of course, for many home buyers, especially those without a big — or any— renovations budget, this is easier said than done.

When the timing is right

Every municipality has a building code, says Vanderploeg, and the work that you do on the home must fall within legal bounds. “An architect usually will supervise the work, and then at the end of the process, they’ll sign off on it,” he says. However, this can be time-consuming.

You can also run into hurdles if your contractor falls behind schedule, has trouble staying on budget, or is just unreliable. “Where people go wrong sometimes is having a bad contractor,” says Vanderploeg.

If you’re unable to live in the home or get stuck waiting for permits, you could also find yourself in a bind. “Sometimes we have to find people a place to live for six months to a year while they’re waiting for something to be finished,” Vanderploeg adds.

For these reasons alone, homeowners need to be clear-eyed about the renovation process.

Remember, committing to upgrade a fixer-upper is more than a labor of love — it requires a time and financial commitment. But if you’re willing to go all in, think about the bragging rights!

Hear about one family’s fixer-upper experience:

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Top image from Zillow listing.

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Source: zillow.com

I Want to Buy a House, but It Needs Some Major Repairs. Is It Worth It?

‘The Big Move’ is a MarketWatch column looking at the ins and outs of real estate, from navigating the search for a new home to applying for a mortgage.

Dear MarketWatch,

I want to buy a home that needs a lot of repairs and renovations, but I’m almost 50 years old. Is it worth it? How long does it take for home improvements to pay off?

Sincerely,

Fixed on a Fixer-Upper

Dear Fixed,

If you watch a lot of shows on HGTV, the idea of buying a home in need of some TLC for a bargain and sprucing it up sure can sound appealing. Many among us fantasize about embracing their inner interior designer, taking a rundown home and giving it the Chip and Joanna Gaines treatment. In the interest of honesty, I’ll admit that I’m guilty of such day dreams.

I can say with a fair degree of confidence that you already have the right instincts here. There are plenty of reasons to be skeptical about taking on such a huge project. The biggest one: They don’t usually pay off.

Smaller-scale home-improvement projects might have a better return on investment. For instance, a can of paint or two costs hardly anything, and research shows that painting the rooms in your house the right color can add as much as $3,000 to the home’s sale price.

With anything bigger than that, you’re unlikely to recoup your investment. Remodeling Magazine each year puts out a list of the home upgrades that fetch the biggest returns. The 2020 edition of this report showed that on average not a single home-improvement project sees a 100% return. The closest you could come — adding a manufactured stone veneer to your house — was a 96% return on average. And in most cases, the returns on renovations had fallen between 2019 and 2020.

Americans generally view owning a home as a financial investment — and the four-bedroom home with a white-picket fence surely factors in the American Dream. Many people go into homeownership hoping to see their equity grow over time — with the goal of passing that money onto their children or using it as a cushion in retirement. But when you compare real estate to other assets, it’s clear that owning real estate is more complicated than that.

“Many financial investments will grow as fast, or faster, than personal real estate and be far more flexible if you need any access to liquidity along the way,” said Sean Pearson, a Pennsylvania-based financial adviser and associate vice president with Ameriprise Financial Services. “If you live in your house long enough, and you sell during certain types of markets, depending on interest rates, you might see a positive ROI from your home. But that could be a long way from now, and requires a lot of things to happen along the way.”

Instead of approaching buying a home with an investor’s mindset, I suggest you consider the myriad other reasons why homeownership can be beneficial. Owning a home allows you to take control over your housing costs. Sure, the property tax bill or utility rates may vary over time, but you won’t need to worry about a landlord jacking up the rent unexpectedly. And the equity in your home — if used appropriately — can become a useful financial tool to consolidate other debts or finance a child’s college education. (Again, approach cashing out home equity with caution.)

You’re almost 50 — and maybe a decade or so away from retirement. Think about whether this home could be your forever home. If you’re making major renovations, you could really ensure that this home would be one you could live in for the rest of your days by approaching those repairs with accessibility in mind. If you can afford major home improvements, and they’ll enrich your quality of life, it’s hard to put a price tag on that.

Or you might decide that owning a home isn’t worth it. There is a benefit, after all, to being able to rely on a landlord or property manager to handle upkeep. And in many parts of the country, renting a home and using your remaining money wisely could be a better deal that becoming a homeowner.

Whatever path you choose to take, I encourage you to keep trusting your gut. It’s not led you astray so far.

Source: realtor.com

What Remodel Projects Add the Most Value to a House?

Last Updated on June 13, 2020 by Mark Ferguson

I have flipped more than 190 houses in my career, remodeled rental properties, and even fixed up properties for banks when I was an REO broker. Over the years, I have learned a lot about what repairs or remodel projects add the most value to a home. It can be easy to miss simple things that will add value or spend way too much on home renovations. The type of house, price range, and location can also impact what the most cost-effective home repairs will be. In general, there are definitely some repairs that will add more value than others.

Is it worth it to make home renovations?

A lot of people who are thinking about making home renovations or repairs wonder if they are better off just selling the house for a lower price instead of making the repairs. If the home needs $20,000 in repairs, just lower the price of the home $20,000 or $25,000. In principle, that sounds great, but it is rarely the reality.

When a home needs repairs or updating, it often lowers the value of the home by much more than those repairs will cost if the repairs are done cost effectively (more on that later). If a home needs $20,000 in repairs, it might lower the value of the home by $40,000.

Home repairs can also impact the financing available on properties. If a home needs a new roof or the major systems need work, it might eliminate 80 percent of buyers because they won’t be able to get a loan on the home. $20,000 in work might decrease the price by $60,000 if it impacts the financing choices.

In other cases, it is possible to spend more money on renovations than it will to increase the price of the home. You can over-improve a home for the neighborhood. I have seen people spend $50,000 on a kitchen that added $20,000 or less in value. The homeowners could have spent $10,000 on the kitchen and still gotten $20,000 in value added. A $50,000 kitchen is usually not needed unless you are in a high-end neighborhood.

It is almost always worth it to remodel or repair a home before you sell it if you are smart about what you do and keep the budget reasonable.

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What are the most important things to fix?

When selling a house, the most important things to have in working order are the major systems because they will affect the ability to get a loan on the home. If the roof is bad, the electrical is bad, the plumbing is bad, the HVAC is bad, or the foundation has major issues, most buyers will not be able to get a loan on the home.

Not only will you be eliminating 80 percent or more of the buyers, but you will also have to discount the price of the home to make up for the needed repairs. The most-likely buyer will be an investor who wants to make money. The investor does not want to spend time and money fixing up a house just to break even.

Many investors will use the 70 percent rule to determine what to pay for a house that needs work. That rule states they should pay 70 percent of the value of the home minus any repairs needed. So, if a home is worth $200,000 after it is fixed up and needs $30,000 in work, the investor will want to pay $110,000 for it!

$200,000 x .7 = $140,000 minus $30,000 = $110,000

That may seem crazy for the investor to be so greedy, but they are not making $60,000 on that deal. They have many costs besides the repairs like carrying costs, financing costs, buying costs, and selling costs. The investor needs to buy the property that cheap to make the risk worth it.

As you can see, $30,000 in repairs cost the homeowner $90,000! The homeowner might be able to find a non-investor to buy the property, but they will want a good deal as well. Maybe they are able to sell it for $125,000 or $140,000, but the $30,000 in repairs costs them much more than $30,000.

If you have problems with the major systems that prevent financing, those are the most important items to fix before you sell. They are also most likely the most important items to fix if you do not plan to sell as well. Those problems cause issues with financing because they can cause problems with the house. If you ignore those problems, they could cause much more expensive issues like fires, floods, structural problems, or sickness.

A really good real estate agent can let you know what problems with the house will cause issues with financing.

How do home improvements add value?

Unfortunately, repairing the roof may not add value to the home. If the home is worth $200,000 and you repair the roof, it is still worth $200,000. The buyers expect the roof to be in working order. While the new roof won’t add value, a bad roof certainly will detract from the value.

Some home improvements will add value, like remodeling the kitchen, baths, adding a deck, or even adding an addition. The amount of money these improvements add can be very difficult to calculate because every house is different. Every house is in a different location, is in a different condition, and has different features. Each buyer also has different tastes. The house shows that tell us exactly how much each project adds in value drive me crazy because there is no way to calculate that. You have to look at the big picture. You can spend $100,000 remodeling a house, but if the foundation is bad, you may have just wasted a $100,000.

The way you value a home is by comparing a house to recently sold houses in the same neighborhood. No two houses are the same, so it is impossible to say one kitchen added $10,000 or another bath added $5,000. But, you can say that the house sold for $10,000 more and has an updated kitchen and baths. Those kitchens and baths had something to do with the value, but there could have been other things that detracted or added to the value as well.

People’s emotions also play a huge role in how much they will pay for a house or what house they will buy. A lot of people think our carpet is bad or the house needs paint, but those problems will not affect the financing. We will just offer an allowance or lower the price a little. Not doing simple repairs can drastically decrease the price as well because most people buy with emotion.

If a house smells, is dirty, the paint is worn, the carpet is old, or even is too cluttered, it will turn off most buyers, even though those are easy problems to fix. I am a house flipper and can easily imagine what the house will be like when I am done with, but most people cannot. Or they let how they feel about a house determine their decision making instead of the numbers or logic.

This article goes into more detail on how to value homes.

What are the best home improvements to make?

It is often said that kitchens and baths sell houses, and that is usually correct. Buyers care about the kitchens and baths because those are generally the most expensive to remodel and the most visually interesting part of the interior of a house. As I said earlier, paint and flooring make a huge difference as well.

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Paint and flooring

I put paint and flooring number 1 because they give the feel of the house. They can also contribute to the smell and aesthetics. Paint and flooring are also some of the easiest repairs to make and can be very affordable if done right. You can paint the interior of a 2,000-square-foot house for $3,000 to $5,000 depending on the painters and area. Although, many companies will prey on homeowners and charge much more if they can.

New paint and flooring can easily add $10,000 to $30,000 of the price of a $250,000 home. I always suggest neutral colors that will appeal to most people if you are looking to sell.

Kitchen

The kitchen is the first thing many buyers consider when buying a house. How much space is there? How functional is it? How updated is it? We remodel many of our kitchens but not all of them. We rarely, if ever, put in high-end kitchens into our projects. A lot of contractors will try to convince homeowners they need $50,000 kitchens when that is rarely the case. Sure, it is nice to have a Bentley instead of a Honda, but does that car make sense for your family and budget? The same goes for the house you live in. We buy cabinets, counters, and appliances from Home Depot, which makes most of the materials for our kitchens less than $5,000. Sometimes, we might spend another $1,500 on upgraded counters.

A new kitchen can add $5,000 to $15,000 to the price of a $250,000 home depending on how bad the old kitchen was. If the kitchen is not that bad, you might be able to get away with new appliances or new counters and save a ton of money.

Bathrooms

Bathrooms are another area of the house that can add a lot of value but also cost a lot of money! We can put in a simple bathroom with a new toilet, tub, surround, and vanity for $3,000 to $5,000. That assumes some plumbing and electrical work will be needed. If you have three bathrooms to remodel, your budget can increase very fast when redoing each bathroom.

It is also possible to get super fancy and spend $20,000 on a bathroom. Again, you will almost never get that money back unless you are in a very high-end home and the other homes around you have very high-end features that buyers expect.

Upgraded bathrooms will add value to houses, but it is hard to put a number on them. $5,000 to $20,000 can be added depending on how many bathrooms and how bad they were before. As with kitchens, if the bathrooms were not in bad shape before you might able to get away with new vanities and not mess with the tubs or shows, which can save a lot of money!

Fixtures

Light fixtures, door handles, and even plumbing fixtures can add value as well. If you are smart and do not break-the-bank buying fixtures at high-end specialty stores, it is usually worthwhile to put in new fixtures. If you put in new fixtures, you may be able to get away with not spending as much money in other areas as well. If you replace the old faucets, you might not have to replace the sink or the bathtub. If you replace the door handles, you might not have to replace the doors.

We usually spend $1,000 to $2,500 replacing the fixtures. Light fixtures and new paint make a huge difference in how a house feels and can add a lot of value without much expense. New fixtures can add $2,000 to $5,000 to the value of the house, and they can also make the house sell much faster.

Landscaping

We put in simple landscaping on some of our houses and do almost nothing on others. The thing about landscaping is that it can hurt the curb appeal, but many buyers feel they can fix the landscaping themselves. Far fewer buyers think they can replace the bathroom or kitchen. You can get away with less landscaping in some houses than you might think.

In some areas, a sprinkler system is very important and is a must, and in others, it is not as important. Again, what makes sense will depend on the area and other houses in the neighborhood. In some areas, a fence is a must, and in others, not important at all. It is usually not a good idea to spend tens of thousands of dollars on fancy landscaping if your concern is getting your money back out when you sell.

Windows and Doors

Windows and doors can add value to homes, but it is tough to say by how much. What they can also do is detract from the value and make a house hard to sell if they are old and outdated. Most buyers will expect a house to have newer windows, and old, plain doors can really detract from the look of a house.

The tricky part with windows is the cost. We can buy windows at Home Depot and have them installed for about $300 a window. That could be $1,500 to $5,000 on a house total. Those windows often add about as much value as they cost, but they make a house much easier to sell.

What can really cost homeowners a lot of money is high-efficiency, low-e windows. Window companies love to try to sell their windows at more than $1,000 each! You could spend $20,000 on the windows! While it is nice to save a few bucks a month on electric bills, (that is literally the difference between low-e and regular Home Depot windows) it will not come close to adding that much value to the house. 98% of buyers don’t care what kind of windows the house has as long as they are newer. Some reviews even show buyers are no more or less satisfied with the fancy windows than the cheap windows.

Doors will not add much value to a home either, but they can detract from the value if they are broken or old. You may be able to paint doors to make them look decent, but if you have to replace them, it can cost from $150 to $300 per door, which can add up quickly! The doors will usually not add as much value as they cost to put in.

Additions

A lot of people want to add additions to their homes, and rarely do they add as much value as they cost. In some cases, the wrong addition can detract from the value! Additions are tough to pull off because most houses are designed a certain way and an addition was not in the plans. You really have to be careful that you are not just adding a room that will cost $30,000 and be useless to 90% of the population.

In most markets, an addition will not be worth it after paying for all the permits, plans, and construction. You might have to do a lot of work to the existing house to make the addition work as well. If you are in a very expensive area where popping the top makes sense, you might be able to pull it off, but you need to be able to add much more value than you think the addition will cost.

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Contractors and getting the work done

Something else to consider is that when you have the work done by contractors or professional companies, the prices can vary greatly! Some contractors may charge $50,000 for a landscaping job while others may charge $10,000 for the same work. It is important to choose the right person to do the work and check them out beforehand as well. I have another article that goes into how to find contractors here.

Conclusion

Making repairs is usually a good idea when selling a house. Which repairs to make can be tricky to figure out because every area of the country is different, and every neighborhood is different. You also need to be careful how much you spend on the repairs and which contractors you use when making the repairs. If you are completely lost, a real estate agent can help you with the process, especially if you are thinking of selling soon. They often know which repairs bring the most value in their area and may have contacts for contractors as well.

Source: investfourmore.com

Working With a Design-Build Team to Create Your Dream Home

What do the experts say you need to do and know for a smooth build out?

Building your dream home from scratch is a daunting task, especially if you’ve never worked with an architect, builder, and design team before.

To make the project a little easier to wrap your head around, here’s some advice from construction professionals.

Do your research

The building process isn’t short, so make sure you are happy with your team — you’re stuck with them for a long time.

This requires doing a little homework.

To start the building process right, you’ll want to do the following:

  • Conduct extensive online research to make sure you’re using a reputable builder
  • Get referrals from friends and family
  • Look at examples of the builder’s current work

Nikki James, studio manager at Ashton Woods, a builder and design studio constructing homes in the South and Southwest, recommends visiting a builder’s model homes and those under construction.

It’s fine to even be a little sneaky, says Jesse Fowler, president of Southern California-based Tellus Design + Build. Pop in at a construction site unannounced to see what the job site looks like. Workers not wearing hard hats or lots of garbage on the ground are red flags.

Ask questions (and more questions)

You need to understand the parameters of what the builder is doing for you, advises Roger Kane of Kane Built Homes in Massachusetts. And you get that information by asking questions. Make sure the builder can execute what you want, because not all builders can accommodate custom designs.

One of the first things you should do before meeting with your team for the first time is to identify what you don’t know, and then eliminate that doubt.

If this is your first time building, there are probably going to be a lot of things you don’t know, and that’s fine, Fowler says. There are no dumb questions.

Here are a few starter questions:

  • What exactly are you paying for?
  • Do you need full architecture/design/build services, or do you just want a blueprint?
  • How much time should you allow?

Know what you want

“Design inspiration can come from anywhere,” says James. She asks her clients to bring in plenty of pictures, scraps of fabric, or anything that speaks to their aesthetic.

The first thing to do, Fowler says, is to figure out the look and feel that a customer likes, and weed out what they don’t like.

It’s also important to know your limitations, though. James warns that you must make the structural selections for your floor plan before picking design elements so you know what you can and can’t have. For example, if you want a freestanding tub, you will first need to know if you have the right plumbing for it.

An architect wants to know how you’re going to use your home, advises Kim Nigro, the architect at Chicago-based Studio Nigro Architecture. Tell your architect what you don’t like about your current home, and what your day-to-day needs are.

This can be as simple as letting them know you shop at Costco a lot, so you want a big pantry, James says.

The details matter

You probably never thought about what kind of grout you want between your tiles. But these are the kinds of decisions you will be making.

Ashton Woods gives its customers a checklist for details like this, and there are a lot of specific items on it, from what kind of edge you want on your counters to how many outlets and phone jacks you’ll need.

This sounds overwhelming, but Kane’s advice is to just take it room by room. Start out with the basics. Determine how many bedrooms and bathrooms you need, then go inside each room and think about what should be in it.

“Make a list,” he says. “’We want hardwood flooring; we need his-and-her closets.’ Make your own little notebook and just address every room. That’s a great way to start.“

Know your budget

The harsh reality is that you can’t buy something you can’t afford. So, do your math and be upfront about your budget.

“Not communicating a clear budget to a designer is a mistake,” Fowler advises. “Designers need something tangible. If you let them go wild, 99 times out of 100 they are going to do something you can’t afford.”

There are good reasons not to pinch too many pennies, though.

As the saying goes, “If it seems too good to be true, it probably is.” You probably shouldn’t go with the cheapest guy out there, Fowler suggests. A lot of builders, he says, cut corners by doing things illegally.

Don’t get roped into a mess like that. Saving a few bucks now might end up costing you more later.

James recommends doing things exactly the way you want them from the beginning, because remodeling later will cost you more money and more stress.

“We see a lot of buyers getting nervous about spending too much. As people get closer [to finishing], they wish they had spent that extra money,” she reports.

Spending more for quality products is another big consideration. Kane uses sustainable products for the exterior of his houses that last “pretty much a family’s life in a home — 30 to 40 years.”

That’s good for the environment and your wallet, because regular maintenance like repainting the outside of a house can cost $15,000.

Be decisive

The biggest mistake Kane, a veteran homebuilder, has seen homeowners make is being wishy-washy with their decisions.

Once a home is under construction, it’s important to have made all your major design selections.

“Paint color’s not a big deal,” Kane says. “But you should have things like all your tile and granite picked out.”

Why? Because at this point in the process, your selections could be backordered, and waiting on them is costly to the builder and to you.

If you do tend to change your mind a lot, make sure you pick a builder with a good warranty program.

Communication is key

One core piece of advice from construction professionals: Keep the lines of communication open. The biggest mistake you can make, says Fowler, is leaving gray areas in your building and design plan.

“I’ve heard horror stories, and most are because one party’s expectations were different from the other’s,” Nigro states. “The more developed drawings can be, the fewer assumptions the contractor will have to make.”

And it’s not only important for you to communicate to your design team. The members of your team need to be on the same page with each other as well.

“They need to really create a collaborative team,” Nigro says. “There are a lot of decisions to be made.”

Fowler recommends getting the whole team together to meet each other and start working collaboratively from the start. Most times, he says, architects, designers, and builders who work in a community have met and done projects with each other before.

Consider the trends

More homes across the country are being built “healthy” or “green.” These are homes built with non-toxic, natural products and materials.

Nigro says she used to recommend healthy building to her clients, and now people are coming to her asking for it.

Another trend sweeping the nation is “mother-in-law suites” or homes that accommodate multi-generational families.

Over the past five years, a lot of Nigro’s clients have started looking down the road to when older relatives might move in with them, or maybe their adult children will move back home after college.

This could mean a separate apartment over a garage, or maybe a guest bedroom on the main floor.

Why are trends an important factor to consider? It could help you sell your home in the future.

Have fun

“It’s important for us to personalize your home and make it yours and something that you’re proud of,” James remarks.

If this means having a full basketball court right on the main floor next to the dining room, like one of Nigro’s customers wanted, then that’s what you should have!

Custom features can range from practical to fantastical: Fowler has had clients ask for water pipes over their nightstand so they wouldn’t have to get up for water in the middle of the night; “living walls” (walls with plants or grass growing right on them); hidden cameras; and even an unexplained hole in the closet floor.

Hey, it’s your dream house, after all.

Wondering if new construction is right for you? Search new construction listings, and get more home-buying tips and resources to help you decide.

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Originally published October 21, 2016.

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Source: zillow.com

Small Updates, Big Return: 5 Ways to Increase Your Home’s Value

No matter your budget, there’s always an upgrade or two that’ll up the resale ante.

Whether your home improvements are for you or potential buyers, consider their impact on your home’s potential resale price before picking up your toolbox (or the phone to call a contractor).

A brand-new kitchen or bathroom will undoubtedly wow potential buyers, but there’s no guarantee you’ll recoup the money you put into those pricey remodels.

To help you navigate the choices that lead to the best return on investment, we asked two industry experts (and one enthusiastic DIYer) to weigh in.

Kitchen renovations

“Renovating the kitchen is always the biggest way to add value to your home,” says Grace Fancher, real estate agent at Kansas City firm Sarah Snodgrass. “People love to cook, and everyone tends to gather in the kitchen. If you add seating, such as an island with barstools, buyers go crazy for that.”

A full remodel is a major investment, but smaller projects make a big difference if you can’t — or don’t want to — go all out. “Nicer appliances really stick out to potential buyers — even if you’re planning to take them with you,” Fancher says.

She also suggests replacing tired finishes with fresh, neutral materials. “You don’t want to be too trendy, but you want it to look up-to-date,” she says. “Everyone loves clean, white subway tiles now, but they’re really a timeless look.”

Replacing dated countertops (quartz is your best bet, according to Fancher) and flooring is also worth the time and money.

Bathroom updates

The smallest rooms in the house can have a big impact on its value, so Fancher suggests adding a second bathroom or upgrading existing ones so your home features at least two full baths.

Joe Monda, co-owner of Seattle-based general contracting firm Promondo, agrees. “People are spending more on upgrading their houses before listing them,” he says. “They really want to maximize the potential house value.”

But if you’re remodeling a bathroom just to put your house on the market, keep it simple. “Most people don’t want to pay for upgrades, so you want it to be a neutral space that doesn’t look straight out of the big DIY warehouse stores — even if it is,” says Fancher.

She adds that an easy solution is spending a little more on details, like high-quality towel bars and upgraded hardware for those big-box store vanities.

Not in a position to remodel? “Re-grouting tile, or even just using one of those grout paint pens, gives any bathroom a fresher look,” says Sharyn Young, a self-proclaimed DIY addict from Minneapolis.

Lighting upgrades

“The brighter a room feels, the bigger it looks,” says Fancher. “And when you’re selling, you want every space to look as big as possible.”

She recommends replacing flush-mount ceiling lights with recessed and/or pendant lighting — a relatively cheap upgrade that looks modern and makes a huge impact.

“LED lighting has changed everything,” says Young. “There are so many readily available, inexpensive options now that are easy to install. I added Ikea under-cabinet lighting in the kitchen of my last house, and I was amazed at how that one simple upgrade made the space feel larger and cleaner.”

Fresh paint

Like lighting, a new coat of paint can also make a space feel cleaner and brighter. Stick to neutral shades, such as light gray and beige, and if you don’t have time or budget to do the whole house, start with the living areas you see when you first walk in.

An even quicker fix is refreshing just the trim. “Beat-up, dirty trim can give buyers a subtle impression that the whole house is dingy,” Fancher says. “Repainting gives a sharper look and shows the buyer that you’ve taken care of the house.”

Landscape improvements

“A lot of people overlook how important landscaping is, especially when you’re selling in the spring or summer,” says Fancher, adding that you can increase curb appeal by just putting down new, dark-colored mulch, if you don’t want to spend a lot of money on planting.

Monda suggests paying special attention to the entry. Repair or replace any damaged stepping stones, concrete paths, and porch plants, then give the front door a fresh coat of paint and add some potted plants. “You want people to be excited to walk in the door,” he says.

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Source: zillow.com

Is a Fixer-Upper the Right Choice for You?

It looks easy on TV, right? Home buyers with limited budgets but unlimited enthusiasm buy a diamond in the rough and transform it into their dream home – or a place they can sell for a tidy profit.

So you may be planning to look for a place you can afford now and fix later, when you have the time and money. Many have done it, but remember that reality isn’t the same as reality TV. A fixer-upper needs a lot of elbow grease, time, imagination and patience, especially if you’re renovating and living in the home at the same time.

Or you may have enough money to buy a fixer and complete everything before moving in. Either way, here are some things to consider.

Is the fixer-upper worth fixing up?

When you’re looking at fixers, ask yourself:

• Are the needed repairs cosmetic or structural? Cosmetic fixes generally cost less, are easier to complete and provide instant eye appeal. If the home needs new wiring, plumbing and a roof, you’re talking big money.
• Are the repairs required worth it? A new roof or renovated kitchen may be worth the investment if you’re staying put, but may not pay off for a flip. It depends on the project and your market.
• Who’s going to do the work? Whether you do it yourself or hire others, you’ll pay for it — in time, money, and/or stress.
• How well do you handle disruption? From dust and debris to the daily parade of workers, some people would rather just pay more for a more finished home.

The numbers

The thing about fixer-uppers is that you can’t be sure about everything that needs fixing-upping, especially problems behind walls. A good inspector can sniff out plumbing, electrical and foundation problems that will cost a lot to remedy and may not make this deal cost effective. Bringing wiring and plumbing up to code isn’t optional, and you should know exactly what problems you’re dealing with. Then, if you still decide to go ahead, you might have some price leverage, even if you’re buying the house “as is.” It never hurts to ask for a price reduction after the seller sees the list of problems.

To help estimate the cost of remodeling projects, you can use a remodeling calculator which produces an approximate cost for your area. Once you’re serious about a place, you can hire a contractor to provide an estimate for renovations.

Of course, lovingly nursing a home back to health is priceless — for some. But for most people, the math that makes a fixer a good investment is easy. Figure the cost to renovate the property (add another 10 percent for unforeseen problems and add-ons) and subtract that number from the home’s probable, post-renovation value gleaned from comparable sales and Zestimate forecast, which predicts a home’s Zestimate® one year from now. What’s left should guide your bid for the property.

Do you want to flip the fixer?

Finding a fixer can be a flipper’s dream, but only if the home needs low-cost cosmetic upgrades you (or a reliable, affordable crew) can do. The trick is to get in and out before financing costs or a market change eat your profit.

Don’t buy a fixer with major foundation, electrical, plumbing or HVAC problems — all are expensive and time consuming to repair. Plus, once you start replacing wiring and pipes, you’ll be ripping open walls that will require patching and painting, which adds days to your project calendar.

Opt instead for properties where you can refinish hardwood floors; remove a non-load-bearing wall to open the space; update a kitchen with new cabinets, appliances and counters, and renovate bathrooms that don’t require moving the plumbing.

Outside, you can increase the home’s curb appeal by adding foundation plants, greening up the lawn and pruning plants.

If you plan to make the house your dream home, keep all receipts. Capital improvements, usually considered upgrades that increase the value of your home, become part of the new tax basis of your home and may provide some tax breaks on profits when you eventually sell.

Source: zillow.com