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11-17 of 17
  Sat Mar 02

Real Estate Info

Common Appraisal Myths

An appraisal is an important part of many real estate transactions. An appraisal is typically done if a buyer requires a mortgage loan to purchase a property. The appraisal is done by an appraiser (who is licensed), and it's based on multiple data gathered during an inspection by the appraiser. When it comes to appraisals, there are many myths or misconceptions around them. Whether you're looking to buy a home, looking to refinance a current mortgage, or you're looking for more information about all that goes into real estate transactions, here are some of the most common myths when it comes to appraisals.

An Appraisal is the same as a Home Inspection

While both an appraisal and home inspection provide important information to all parties, the two are not the same. An appraisal is done to determine the value of a property, generally for the benefit of a lender. The appraiser will inspect a property for improvements and deficiencies but only to determine the overall value of a property. A home inspection, on the other hand, is an inspection, but its main purpose is to look at the 'guts' of a property, assessing the overall condition, and inspecting the major systems, appliances and structure to determine the shape of a property. The appraisal is done to determine the value of a property; a home inspection (which isn't required) is done to determine the overall health of a property.

Assessed Value, Appraised Value and Market Value are all the Same

For many properties and in many states, the idea that the assessed value, appraised value and the market value are equal is understandable. But, in many areas and instances, this isn't the case. Assessed value is determined by an assessor (who works for a city, town or county) and is usually used to levy taxes; if the assessor doesn't actually physically inspect the property, s/he won't know if any improvements (remodeling projects, interior updates, additions, etc.) have been done. The same can also be said if nearby properties have not been reassessed for a long period of time or they don't reflect the area's current real estate market. Appraised value is determined by an appraiser, and is a result of a detailed physical inspection of a property and research done on the neighborhood and any nearby recently sold properties. Market values are consumer-driven and can be influenced by a buyer - if a buyer is willing and able to pay more for a property, then the market value is what the buyer is willing to pay. While all three values can be similar, all three also have the chance of being vastly different.

The Appraiser is Hired by the Buyer

An appraisal is required when a home is being purchased with a mortgage loan; a current homeowner is looking to refinance his/her existing mortgage; or when someone is selling a home to someone that is not an all-cash buyer. The appraisal acts as a security for the lender to understand the value of the property when making the loan decision. Due to federal changes several years ago, although the lender orders the appraisal, the lender does not hire a specific appraiser; the appraiser comes from a 'pool'. For the majority of property transactions, the buyer is responsible for the cost of the appraisal (sometimes a seller will cover the cost of the appraisal, but this is unique, and for the most part the buyer or borrower pays the costs through the lender). There are times when a seller may want to get an appraisal to get an idea of a home's value before listing the property - in this case, the seller would hire the appraiser and pay for the appraisal.

The Appraisal Varies Whether it's For the Buyer or Seller

Typically, an appraiser has no vested interest in the price of a property - s/he doesn't represent any particular person. The appraiser should complete an independent and objective appraisal, simply performing the service of determining a property's appraised value. Appraisals can be done for a number of reasons: insurance, home loans, tax losses, estates, liquidation and net worth. Because of this, depending upon the purpose of the appraisal, the market value and appraised value can vary, but the appraiser does not complete an appraisal in favor of the seller or the buyer.

Appraisers Use a Formula to Determine the Value of a Property

The way in which appraisers determine the value of a property is very detailed. An appraiser will analyze all aspects of a property: location, condition, size, proximity to amenities and other facilities, and s/he will also consider the recent sale prices of comparable properties in the area. Other items that are considered in the appraisal: number of bedrooms and bathrooms and the floor plan functionality. The appraiser does a visual and physical inspection of the interior and exterior of the property. S/he will take into consideration the type of flooring in a home; the materials used in the kitchens, bathrooms, and other rooms; the siding and any other recent upgrades. An appraiser will also consider things that need to be repaired, and other miscellaneous items. Far from a specific formula, appraisers use a lot of data to determine the appraised value of a property and an appraisal can take a number of hours to complete depending on the size of a house and complexity of the property.

 
   
  Sat Mar 02

Long Island Index Releases Study of Region’s Complex Relationship with Accessory Apartments

Long Island Index Releases Study of Region’s Complex Relationship with Accessory Apartments

That Experience Should Inform Future Policies Relating to the Need for Affordable Housing

Garden City, NY – June 26, 2017 – The Long Island Index, a project of the Rauch Foundation, today released a study that explores the complex relationship between Long Island and accessory apartments, a housing type that has been used both legally and illegally in a wide range of communities to address the need for affordable housing and the desire of seniors to remain in their homes. A classic accessory apartment is a separate, secondary, dwelling unit of much smaller size than the primary home, either in the house itself or in a carriage house or converted garage.

The study – titled “Home Remedies, Accessory Apartments on Long Island: Lessons Learned” – is written by former Newsday reporter and freelance writer Elizabeth Moore. It reveals that almost four decades after some Long Island towns began cautiously allowing accessory apartments in single-family homes, this housing type is broadly accepted in Suffolk County, even as it remains controversial in much of Nassau. At the same time, despite any number of crackdowns, amnesties and code changes, both counties continue to contend with rampant illegal apartments whose owners are uninterested in finding ways to be legal. Several jurisdictions have all but resigned themselves to the illegality by assessing extra taxes on presumed scofflaws who refuse to allow inspectors access to their homes. Still, for many Long Islanders accessory apartments are essential, and Long Island’s experience with them holds a key to addressing the need for affordable housing in the future.

The study reveals lessons learned on Long Island, as well as in other parts of the country. Those lessons illuminate the forms of accessory apartments that have gained traction in local communities and the communities’ capacity to enforce existing zoning codes.

The study includes a map showing where on Long Island accessory apartments are permitted, limited, grandfathered, and not permitted. It also includes an appendix containing the local policy on accessory apartments in every city, town, and incorporated village on Long Island.

The need for accessory apartments stems from the fact that Long Island has gone from being one of the most affordable places to raise a family to one of the least affordable. The single-family neighborhoods that defined Long Island’s appeal are now home to shrinking families struggling to cover the costs of all those empty bedrooms, even as the region’s work force faces a shortage of moderately priced rental housing. As a result, single-family homeowners installed an estimated 90,000 illegal apartments by the mid-1980s, according to the Long Island Regional Planning Board.

Accessory apartments have proven their worth as the most affordable type of rental housing in the region. They can be easily accommodated because they don’t require large infusions of capital, new roads, new sewers or expansion of the electrical grid. Instead, existing neighborhoods absorb the rental-seeking population like a sponge, while stabilizing finances for tax-strapped homeowners. They also provide affordable housing that is blended throughout the community rather than clustered, and having a resident homeowner usually means that they are better maintained than rentals with absentee owners.

Today, nine of Suffolk’s 10 towns have established procedures to legalize or authorize accessory apartments for nonrelatives. In Nassau only one has: the town of Hempstead allows homeowners 62 and older to apply for “senior residence” accessory apartment permits, and 848 apartments currently hold such permits. Another 1,344 so-called “mother-daughter” permits have been issued by the town to homeowners who build apartments for family members. Oyster Bay, Smithtown and North Hempstead only permit mother-daughter apartments, or (in Oyster Bay) apartments for domestic servants.

Of 97 Long Island villages with zoning powers, seven issue permits for accessory apartments, while another four allow continuation of apartments that predated their codes. Another 24 permit apartments only in limited circumstances. But 62 do not allow them.

“This study offers a fascinating account of how Long Island has struggled with accessory apartments,” said Nancy Rauch Douzinas, President of the Rauch Foundation. “It reveals lessons that should inform future policy, as the challenge to provide affordable housing continues.”

“Affordability is key to the region’s economic future,” said Ann Golob, Director of the Long Island Index. “Accessory apartments are not the only solution, but this study shows that they are a necessary one.”

For further information, contact Henry Miller at hmiller@highimpactpartnering.com.

About the Long Island Index
Now in its 14th year, the Long Island Index is a source of unbiased reliable data for businesses, nonprofits, civic organizations, educators, and townships throughout the region. Funded by the Rauch Foundation, its overarching goals are to measure where we are and show trends over time, encourage regional thinking, compare Long Island’s situation with those in similar regions, increase awareness of issues and their interrelatedness, and inspire Long Islanders to work together to achieve shared goals. The Long Island Index reports are available for download at www.longislandindex.org; its interactive maps – an online resource with detailed demographic, residential, transportation and educational information – are also accessible from the Index’s website.

About the Rauch Foundation
The Rauch Foundation (www.rauchfoundation.org) is a Long Island-based family foundation that invests in ideas and organizations that spark and sustain early success in children and systemic change in our communities. The Foundation was established in 1961 by Louis Rauch and Philip Rauch, Jr. Funding for the Foundation was made possible by the success of the Ideal Corporation, an auto parts manufacturer founded in 1913 by their father, Philip Rauch, Sr.

   
  Mon Feb 25

WHY SHOULD I HIRE A REAL ESTATE AGENT ?

 Education & Experience

You don't need to know everything about buying and selling real estate if you hire a real estate professional who does. Henry Ford once said that when you hire people who are smarter than you are, it proves you are smarter than they are. The trick is to find the right person. For the most part, they all cost roughly the same. Why not hire a person with more education and experience than you? We're all looking for more precious time in our lives, and hiring pros gives us that time.

Agents are Buffers

Agents take the spam out of your property showings and visits. If you're a buyer of new homes, your agent will whip out her sword and keep the builder's agents at bay, preventing them from biting or nipping at your heels. If you're a seller, your agent will filter all those phone calls that lead to nowhere from lookie loos and try to induce serious buyers to immediately write an offer.

Negotiation Skills & Confidentiality

Top producing agents negotiate well because, unlike most buyers and sellers, they can remove themselves from the emotional aspects of the transaction and because they are skilled. It's part of their job description. Good agents are not messengers, delivering buyer's offers to sellers and vice versa. They are professionals who are trained to present their client's case in the best light and agree to hold client information confidential from competing interests.
 
 

 

   
  Fri Feb 08

Rent Or Purchase ?

 

House in HandsTrulia released a Rent vs. Buy Report. The report explained that homeownership remains cheaper than renting in all of the 100 largest metro areas by an average of 38%!

The other interesting findings in the report include:

  • Even though prices increased sharply in many markets over the past year, low mortgage rates have kept homeownership from becoming more expensive than renting.
  • Some markets might tip in favor of renting this year as prices continue to rise faster than rents and if – as most economists expect – mortgage rates rise, due both to the strengthening economy and Fed tapering.
  • Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989.

Buying a home now makes sense. You can lock in a mortgage payment before home prices and mortgage rates rise as experts expect they will. If you rent, your housing expense will only continue to increase.

   
  Mon Feb 04

Remodeling? Recoup Your Investment When You Sell

Remodeling? Recoup Your Investment When You Sell

Before you pour your savings into a new kitchen and a rainforest shower for the master, think about whether or not you'll be able to recoup your investment when it comes time to sell. 

If you have equity in your home, you can make improvements, but don't go over the limit of what other buyers can spend for a home similar to yours in your neighborhood. 

While it's tempting to make your home more beautiful, you have to consider the rest of your neighborhood. If most residences in your neighborhood are three-bedroom single-story homes, buyers are unlikely to shop in your area for two-story four-bedroom homes. 

Buyers want to shop for a home where there is the most selection of homes that fit their criteria. If they want a swimming pool, they're going to look in neighborhoods where many homes have pools. They won't be aware of your home if you have the only pool in your subdivision.  

That's why over-improving for the neighborhood is a bad idea. Not only will you not get your money back for some updates, your home my be harder to sell because of them.  

Another reason buyers don't tend to pay as much for updates as you might think is broad differences in taste. Your updates may include choices your buyer wouldn't have made because of several reasons:  

You only improved one or two rooms, leaving the rest of the home looking unfinished. 

Your updates were too radical, such as cold minimalism in a traditional setting. 

Your updates masked a problem but didn't solve it, such as a kitchen that's too small. If the kitchen is still too small after you've put in granite counters, don't expect buyers to care. 

You failed to do necessary repairs and updates that were less visible than the new décor but buyers noticed anyway. 

Your updates are beautiful but require a lot of cost and upkeep. 

Buyers want to make a home their own, and don't want to be distracted or confused by design statements that they don't agree with. Enjoy your home while you can, but make sure your new look can be easily depersonalized when it comes time to sell. 

Don't expect to set a listing price based on what you've put into your home no matter how long you own it. Your home will be worth market value no matter when you sell, whatever the value is for that point in time. 

All the improvements in the world won't change that basic fact. Your home and the improvements you make are only worth what willing buyers say they will pay. 

Before you begin renovations, talk to your Realtor and your lender. They will help you develop a reasonable plan for updates that will add value to your home. 

   
  Sat Mar 02

glass

   
  Mon Oct 30

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They continued, "Well, you may not be stupid or broke. Maybe you already have a house and you don't want to move. Or maybe you're a Trappist monk and have forsworn all earthly possessions. Or whatever. But if you want to buy a house, now is the time, and if you don't act soon, you will regret it. Here's why: historically low interest rates."

 

They were talking about rates hovering around five percent. Today, rates are under four percent for a 30-year fixed-rate loan.

Reason No. 1 to buy now: Rates are low

"Low mortgage rates continue to keep ownership less expensive than renting," said Investopedia. "Even a small change in interest rates has a significant effect on what you'll pay each month and over the life of a 30-year mortgage. Take a $172,000 30-year mortgage, for example ($172,000 is 80% of the median sales price for existing homes of $215,000 after a 20% down payment). With an interest rate of 4%, you would pay $821.15 each month. At an interest rate of 5%, the monthly payment would be $923.33, and at 6%, the payment rises to $1031.23."

Reason No. 2: Rents are high

In many markets, rents are rising to unsustainable levels, reports the National Association of Realtors (NAR). "In the past five years, a typical rent rose 15% while the income of renters grew by only 11%."

The cities with the highest rent increase since 2009 include New York, San Jose, San Francisco, Denver, and Seattle. For the rest of the list, click here, and to see how much more renting can cost you over a lifetime, check out Riskology.

Reason No. 3: Qualifications are easier

During the real estate downturn of the mid-2000s, banks and lenders tightened the reins, and often only the most qualified applicants could get approved. Post-recession, qualifications have loosened. Buyers who can't show solid income and a minimum credit score probably won't be offered a risky interest-only ARM today, however, those with less-than-perfect credit and minimal funds still have options. The Federal Housing Association (FHA) minimums are a 620 credit score and a 3.5 percent down payment.

Reason No. 4: Private mortgage insurance fees are down

Buyers who put less than 20 percent down on their home generally incur a monthly fee in the name of private mortgage insurance (PMI). In January 2015, the government announced lower PMI rates on Federal Housing Administration (FHA) loans, which equates to a savings of about $900 a year. Seventy-five dollars a month may not seem like much, but every little bit helps when you're committing to an investment as large as a home.

Reason No. 5: It's still one of the best investments out there

In fact, some would say it's the very best investment out there.

"Buying a home is the best investment any individual can make. Affordability is still at an all-time high," said CNBC.

Not only as a comparison between buying and renting, but as a measurable asset, homeownership stands up—as long as buyers make a smart decision.

"The largest measurable financial benefit to homeownership is price appreciation," said Investopedia. "Price appreciation helps build home equity, which is the difference between the market price of the house and the remaining mortgage payments."

Reason No. 6: It feels good

You know that pride of ownership thing? It's true. Really. Nothing compares to the feeling of walking into a home that's yours for the first time. Or painting the walls a color other than white. Updating the kitchen. Making it your own. Not worrying about your rent being raised. And, of course, watching your equity grow over time.

   
   
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