Monday, June 17, 2019

Home Renovations - The Low Down

Home Renovations – The Low Down
Photo by Skitterphoto from Pexels
When it comes time to sell a home, a lot of sellers as me…”Should I spend the money to make upgrades?” “Will it increase the value of my home?” “Will I get back what I put into the renovation?”

These are common questions from homeowners and home sellers. So, I found a report that puts out information that just might answer these questions. The 2019 U.S. Houzz & Home report gives us the median renovation spending amount, how the renovations were paid for and much more.

To begin, a typical renovating homeowner spent $15,000 on home renovation projects in 2018 according to the aforementioned report. The interesting thing is these numbers are about what has been spent over the last two years. So renovations are a steadily increasing business. And more than half the homeowners who subscribed to Houzz are planning renovations for this year.

Now, you may ask, what are they spending all this money on? In 2018, homeowners renovated an average of 2.8 rooms in their home, upgraded 2.7 systems in their home like electrical, plumbing and A/C; and performed 2.4 exterior upgrades. A surge in kitchen remodeling spending which is the most popular and most expensive room in the home. A typical kitchen renovation cost around $14,000. Guest and master bathrooms came in as the third most popular rooms to renovate. Security system upgrades continue to be a popular option with millennials leading the charge over baby boomers.

Top Funding Sources

Cash is still the primary way homeowners are paying for these renovations but credit card use is on the rise. During 2018, 37 percent of homeowners used a credit card compared to 33 percent in 2017.

It was also discovered that as the renovation costs rise, homeowners became more likely to take out a secured home loan, equity loan or use saved cash from a previous home sale, a gift, an inheritance or insurance payout.

Who is Renovating?

Baby Boomers and Gen Xers make up 81 percent of the renovation homeowners spending around $15,000 a piece. Millennials are about 14 percent and spending around $10,000. Gen Zers are still only a small share of renovating homeowners and spending around $7,000.

Why Does it Cost so Much?

Houzz speculates that the trade war with China is the likely culprit for costs continuing to increase. Just for kitchens, the median spending jumped 27 percent between 2017 and 2018. Master bathroom spending was up 14 percent and non-master bath spending increased 17 percent. These trends are expected to continue.

So, why is this so important? With so many homeowners remodeling and upgrading their homes, they may be choosing to stay in the home longer than anticipated when they first bought the home.

Checking the Cost vs Value Remodeling website, for the South Atlantic region which includes Greenville South Carolina, an upscale master suite addition will cost around $253,821 with a resale value of $131,035. An upscale major kitchen remodels of $126,307 will get you $82,677 resale value. A midrange master suite addition of $121,799 will get you $72,388 resale value. A midrange major kitchen remodel of $63,387 will get a resale value of $40,094. The website goes through various other types of remodels, cost and resale values and will give you a good general idea of what you will spend and what your resale return will be. It also indicates how much of the cost was recouped and whether the change is higher or lower than in 2018.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Friday, June 7, 2019

Market Update – You Should Buy This Summer

market update - you should buy this summer
Home prices will continue to rise. CoreLogic just released its latest Home Price Insights (HPI) for April 2019. Home prices were up in April 3.6 percent over last year same time. The annual price growth shows an acceleration since March 2018. The HPI Forecast is for prices to increase by 4.7 percent by April 2020.

Projected to increase – mortgage interest rates. All the experts, Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are projecting that rates will increase by this time next year. However, Freddie Mac’s current report shows the 30-year rate at 3.99% which is down 0.07 from last week and 0.57 from 1 year ago. Although there was a spike at the end of April in the 3-year rate, it has been steadily dropping. Could this be a leveling off of the interest rates? In the same report, it shows the 15-year FRM and the 5/1-year ARM both down also. Freddie Mac is also reporting that both existing and new home sales have picked up recently.

Renting or Buying, you are paying a mortgage. Unless you are living rent-free with family, you are paying someone’s mortgage. Why not make it yours? As a homeowner, paying on your own mortgage will force you to save money. As you pay down the principal, you will gain equity.

It’s time to make the leap. With both home prices and mortgage rates predicted to rise, the time is now to get into a place that is yours. Take a look at your need and determine if owning a home is right. Are you raising a family? Need stability? Family safety on your mind? These are all good reasons to make the leap and buy your own home.

No matter what your situation, if you are flirting with the thought of buying a home, do it now because when mortgage rates and home prices rise it will cost you more on your monthly payment. Stop paying someone else’s mortgage for them and build your own equity in your own home.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Friday, May 31, 2019

Greenville SC Restaurants Have the Technology

King Tut Grill Greenville SC
Today’s fine dining experiences are changing. Some of the newer restaurants in Greenville SC have instituted updated technology to fill the gap of not being able to find and hire staff.

At the local King Tut Grill, you are greeted with a kiosk upon entering where you order and buy all your food and beverages. This type of kiosk ordering has streamlined and driven up the efficiency with which food is prepared and served. The food is brought to your table by a runner but there is no wait staff circulating to fill your empty glass. King Tut features steak and BBQ and 32 beer taps. Get an 8-oz NY strip steak, baked potato, salad and roll for $16.95.

At another newer restaurant, HabiTap, it is basic counter service with no real servers. Customers will enter and order their food at the counter, have a seat and a runner will bring it to the table. A dining room person will check on tables and keep it cleaned up but there are no classic servers. HabiTap considers itself a fast and casual approach to modern taphouse. It presents made from scratch food with an extensive menu of draft craft beer and hand selected wines.

HabiTap Greenville SC
Both of the above restaurants are also serving up what is a growing trend in the world of beer today. Customers are focusing more of their efforts in discovering “craft” beers than sticking to the older major distributors. The younger generation is not afraid to experience the uniqueness of the craft beer revolution.

Will this be the death of fine dining? Probably not, but it will cost you more for full service. With the unemployment rate down to 3.6 percent per the Bureau of Labor Statistics, it is getting harder to find people to staff a full restaurant. By using technology, restaurants can staff with less experience high school aged students who need that initial work experience. Thus, keeping their overhead a bit lower while still providing you with great food from their fully staffed chef-run kitchens.

This new concept has been dubbed, “fast casual.” It gives those people who only have a short time to eat, a better solution than always grabbing a burger at the local fast-food joint. Times are changing and with it, businesses need to keep up or get lost in the closures.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Friday, May 24, 2019

Natural Disasters Affect Home Appraisals

natural disasters affect home appraisals
Photo by Denniz Futalan from Pexels

--> Natural disasters can affect any homeowner in any area around the U.S. Your home can be hit with anything including a hurricane, flood, heavy snow or ice storm, hailstorm, and even a tornado.

If your home has been partially damaged by a natural disaster, you can get an appraisal which will help support a diminution in the value of your home. Turn a copy of the appraisal over to your tax collector office and you may get a reduction in property taxes for the year especially if your state had a “governor-declared disaster.” The damage your home got may make it hard to get a true value. Make sure to hire a reputable home appraiser.

If your home has been destroyed, the challenge of a home appraisal becomes a severe challenge. The value of the home will have to be recreated using old property records. These may include any changes or updates you made to the home prior to the disaster. If the disaster is large enough as in a wildfire there may be no neighboring homes available to render an accurate appraisal.

Then again, if your home is left intact but the surrounding community has been affected like severe loss of lush landscapes and other natural vegetation, an appraisal on your home may be lower because of the curb appeal or community appeal is gone. If many homes are destroyed the community turns into a lot for sale market rather than a home for sale market.

In the event of a major disaster, there can be fear that the area will be hit or affected again, thus making buyers timid. The area may gain a stigma for a fire or hurricane that will stick around for an average of five years.

After a disaster, you may be faced with two kinds of appraisals. If you are filing an insurance claim, your insurance company will assess the home in terms of total replacement cost which is defined as the cost to replace with a substitute of like or equal utility. They will concentrate on replacing just the structure, ignoring the land and only include the extras as stated in your homeowners' policy. A third-party appraisal considers the price of the land and replacement cost with all the additional costs that go into rebuilding after a disaster or loss.

Over the last decade, many lessons have been learned from significant natural disasters like Katrina, Ivan, Michael, Opal, flooding in the Midwest and heavy snowfall in the northern parts of the U.S. Technology improvements have been made that help appraisers and assessors get past the challenges of a natural disaster and help them mitigate risk. Knowing the fire, flood or earthquake risk for an area helps to support true property valuations. These tools give greater insight with extra metrics over and above standard appraisals.

Again, if you are requesting an appraisal investigate the background of the appraiser and ask questions. Find out what tools they use to assist them with their process in determining value. If you need a reputable appraiser in the Greenville SC area, contact me and I can refer you to one.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Friday, May 17, 2019

The "Boomerang Generation"

the boomerang generation
So, you raised your kids and sent them off to college thinking that once they graduated, they would be off on their own and you would become empty nesters like some of your baby boomer friends. Enjoying retirement, traveling and being on your own.

Then…bam! Your kid moves back into your home. He/she graduated but hasn’t got their footing yet, so they move back in with you to get prepared. But is it the best decision for them? Will it create tension in the home, will there be new rules to follow, will there actually be financial responsibility learned by the child or just a reason to have extra money to play around with.

Researchers at the Urban Institute have found that people who move back in with their parents after graduating don’t become homeowners 10 years later. They have access to a home why would they want to own one? But research also shows that when an adult child moves back into their parents' home it forces both parties to learn to communicate on an adult level which can be a plus as both parties age.

In 2016, Pew Research Center reported in their paper that it is very common for young adults aged 18-34 to be living with their parents. These younger adults who are moving back home are being referred to as the “Boomerang Generation” so named for boomeranging back to their parents' home after college.

Our younger generation is financially struggling and making suggestions like “just don’t spend so much” isn’t getting to the root of the problem. These young adults are often sapped with student loan debt for outrageous amounts and then they are supposed to pay rent, utilities, groceries, and work at a full-time job. Most of the older generations did not have the $1.5 trillion in student debt as the younger generation does now.

Another issue is that wages have not recovered from the not too distance Recession we experienced. The economy is in a strong stretch with more businesses looking for workers than workers available. But wages have not kept up with the recovery. Another global-induced outsourcing has eliminated jobs and a college degree no longer guarantees you job stability. Many have got their degree only to take jobs in beginner level positions like fast-food or retail sales.

Our economy is turning in a way that there will no longer exist middle-income brackets. Most of the purchasing power will be for the top 10 percent of wage earners. This will delay homeownership until people are into their late 30’s.

So who will save homeownership? Looks like it may be Generation Z our up and coming younger people between 18 and 23. They have a desire to own a home and are willing to make sacrifices to do it. But they may require financial help either from government programs or from their parents.

But Gen Z may also be occupied with making themselves happy and getting employment that they enjoy more than concerning themselves with the daily grind of bills, debt and such.

Only time will tell if Gen Z can save the real estate market across the country or not. Builders are still reeling from the recession and not jumping into building homes that they know won’t be bought. Inventory remains low and interest rates are playing the up/down game. For May, they dropped back to 4.20% nationally down .05% from April.

Probably the best advice that we can give these younger generations is to not accrue any debt especially student loans. Work and pay as you go for college so you will be in a better position financially when you graduate. Do your basic coursework at a local state college which tend to be cheaper per credit hour. Then work on your degree as you can afford it. Or join the military so you can get the G.I. bill.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Saturday, May 11, 2019

Swamp Rabbit Trail Expansion Proposed

swamp rabbit trail expansion proposed
Greenville SC and the surrounding areas are making a determined effort to become more walker, biker and runner friendly. Simpsonville is the latest city to announce an expansion of the Swamp Rabbit trail which already covers 22 miles. This multi-use greenway trail runs along the Reedy River and through city parks and connects Travelers Rest with the City of Greenville SC.

The new Simpsonville trail would be just under a mile long and would run from Trade Street downtown to Fairview Road. The path would parallel Southeast Main Street and follow the railroad tracks.

The Simpsonville City Council still must vote to allocate funding but once they do it will move forward by starting work in July. This project will cost around $400,000 and would include infrastructure work along the route.

Currently, the Swamp Rabbit Trail does not connect to Simpsonville, but this will be the main section once the trail gets down to the Golden Strip. If it isn’t connected, it will still be a useful trail for points of interest within the city.

Long term goals for the Swamp Rabbit Trail are to connect it from Travelers Rest down to the Golden Strip. There are trails already running further south in Fountain Inn. But before this can happen, an extension that takes the trail from Cleveland Park in downtown Greenville SC to Clemson University International Center for Automotive Research needs to be built.

Greenville SC County and the surrounding cities are still working on gaining easements and talking with private property owners to make this trail happen. The response has been positive.

Imagine a trail that would traverse all the cities that are included in the Greenville SC area metroplex offering an alternative way to get to work. Offering a secure path away that allows runners, walkers and bikers the opportunity to explore healthy exercise options.

The trend for the younger generation is to move into cities where they can do everything either on foot or by bike. Extending the Swamp Rabbit Trail will go a long way to keeping and recruiting a younger generation of happy workers.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.

Friday, May 3, 2019

Solar Power: Is it right for your home?

solar power: is it right for your home
Photo by Carl Attard from Pexels
In 2011, a $10,000 solar system included 5 panels and your break-even point was probably around the 9-year mark. Today, that same $10,000 investment would get you 3-times the number of panels on your roof and increase the amount of converted electricity you brought in so that you would probably break even on what comes in and what goes out.

Electric companies are in business to make money and they want to make it off you. When you are making electricity, you sell it to them for say .13 cents and when the sun goes down you buy it back at say .13 cents. The hope is that you break even in what goes out and what comes in.

Maintenance or other costs

There are no maintenance costs with solar panels. You do have an option to clean them once or twice a year, but it is optional. Before you buy, look at what the warranty is and what it will cover. If they have a 25-year warranty, guaranteed to produce 85% of their output in year 25. After 25 years, most panels will work but at an increasingly degraded level. So, maybe add to your maintenance budget a panel upgrade after 15-20 years.

Also, investigate what type of inverters the solar company is installing. It is possible they will have a warranty also. Microinverters are good if you have any issue with shade on the panels. String inverters will shut down the whole panel if there is shade where microinverters will not.

Ask about how durable the panels are for the type of weather you have in the area where you live. If you worry about hail, severe thunderstorms, snow or other possible damage, you will want to know how that will affect them.

Solar Performance

Panels will not make more energy than they are rated to output but the weather will affect how much energy you make on a day. To figure out your degradation rate, you can look at the system over six-month time or year-over-year and see what your output was avoiding cloudy days.

If you are worried about what your electricity consumption will be looking into battery storage such as a Tesla power wall. It can be programmed to charge during the low electricity period and then be used when you are in the higher peak periods of electricity use.

If you are interested in figuring out what you break-even point may be here is a link to a solar calculator. Add the number of sunny days for Greenville SC (220) or your area and then insert what your initial investment would be as well as your average KwH from your electric bill.

Additional Info

Also, remember that the Federal Government does provide a tax break for solar panels. This includes solar energy systems and solar water heaters. However, these credits will only be available through December 31, 2021. So, decide quickly.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.