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5 Signs You’re Ready to Buy a Vacation Home

by Rebecca Shahan

Do you enjoy vacationing? If you find yourself vacationing here more than a few times a year, maybe it's time to think about buying a vacation home and renting it out when you're not using it. But how can you be sure you're ready to take on this investment?  Here's 5 indicators that will show if you're ready to buy a vacation home.

You Can Afford It

Well, this seems obvious. But it's a deeper factor that needs to be honestly analyzed. The last thing you want is to be swimming in debt when you're trying to make the most of your new vacation home.

The purchase price of the home is only one part of the whole cost of owning a vacation home. Just consider the expenses you pay now on your primary home - utility bills, maintenance fees, insurance, HOA fees, etc.

Here are a few questions to decide if you have enough money in the bank for your vacation home:

  • Do you have at least 3-6 months of take home pay in emergency savings?
  • Can you make down payment of up to 20%?
  • Are you planning to set aside money for your kids to go to college?
  • Will you be able to save for retirement?
  • Is your existing home paid off?
  • What is the return on investment for this home if you rent it out?
  • How does it fit into your long-term investment goals? 

You've Done the Research

Visiting and living in a place can be two different things.  Take time to understand the surrounding area and what it has to offer. You should also visit during different times of the year to get a feel for what it's like to live here. You should also think about the long term and short term factors of buying a seasonal home, especially if you plan to be staying here a lot.

You Know the Market

Knowing whats happening in the housing market will help you be able to buy your vacation home at the right time. Seasonal demand can affect home prices, so keeping up with the local  home market will help you make the best decision.

You've Made a Plan

Do you know exactly how you want to use your vacation home? Do you plan to rent it out when you're not using it? If so, you need to consider advertising and logistics. You'll need to come up with a rental agreement and payment method for renters.  You may also want to hire someone to keep the home clean and keep an eye on the home. A property management can be helpful, but they often charge as much as 50% of the rental cost.

You Know How Much Taxes Will Be

Rental income is included in both state and federal returns. Have you determined how much those taxes will cost?

Buying a vacation home is a serious investment. But if you have these five factors in line, you can make that investment with more confidence and success.

Visit our blog every week for more real estate advice for Austin and Lake Travis. Selling your home in Lake Travis or Austin? Get a FREE Home Evaluation of your home's value today!

Should You Use a Storage Unit When You Moving in Lake Travis?

by Rebecca Shahan

Many people chose to use a storage unit when they move. There are definitely advantages to using storage a storage unit when you buy a home. But is it always the right solution?

Moving is a time of transitions and new beginnings. It's a chance to weed out the things you no longer need in your life. That way you don't have to move as much, saving money and time.

Yet you may not have the time to comb through every possession. If time is of the essence, then you may just have to get the job done and turn to using a storage unit.

Here's a few things to think about when considering if storage is a good option to help you in the moving process.

Advantages of Using Storage

  1. Pack up all the things you don't need now.
  2. Staging your home will be more simple.
  3. You home will look larger, adding to selling appeal.
  4. Personal items will be out of sight from buyers.
  5. Out of sight, out of mind.
  6. You can sort all your items later.
  7. You can decide what furniture works best in your new home and decide what to keep after you move.

Disadvantages of Using Storage

  1. Another expense.
  2. You'll have to handle everything twice, which is more work.
  3. Not all units guarantee your items will be safe, so you may need additional insurance.
  4. Storing items can lead to delayed decisions about what stays and what goes.
  5. You may end up storing things you don't need, and paying monthly fees for those items.
  6. It's hard to reach items in the back of a full unit.

Portable Storage Units

What about portable storage? Portable storage units are becoming quite popular. PODS is the most popular portable storage company and was the first. The main advantage is that you can keep the unit at your home, giving you more time to load it. Then the unit is delivered to your new house. Some units are also designed to be long-term storage at a warehouse or at your home.

The advantage of portable storage is that you can pack and unpack everything in one go, eliminating the need to haul your things to a storage facility, then back again to the new home.

Moving is hard work for sure.  But with careful planning and good use of storage, you can make the process go more smoothly.

Visit our blog every week for more real estate advice for Austin and Lake Travis. Selling your home in Lake Travis or Austin? Get a FREE Home Evaluation of your home's value today!

Don't Make These Mistakes When Buying a Home in Austin

by Rebecca Shahan

Your home buying experience in Austin and Lake Travis should be one that creates great memories and excitement. The trick is to not let all that excitement get out of hand and lead to you making mistakes during the home buying process.

Here are some common home buying mistakes and how you can avoid them.

"I Saw the House Online. It's Perfect — Let's Make an Offer Before It's Gone!"

Photos are never enough to show you everything you need to know about a home. They are meant to be a preview.

Consider this:

  • Agents take photos that they want you to see. They can't show every nook and cranny.
  • You need more than just sight to truly evaluate a home. How does the home flow? What can you smell or hear?
  • Wide angle lenses are used in photos sometimes to make homes look larger.

Before you make an offer, look at the home, the yard, and the neighborhood in person.

"I Want to Buy This House. And Look, There's an Agent Right Here!"

When you go to an open house, the seller's agent is usually there to host it. You might think that's convenient. But remember that the agent represents the seller, not you.

If you start trying to negotiate with the seller agent on your own, you could compromise your negotiation. So make sure you hire a buyer's agent who will work on your behalf and help you get the best home for your needs.

"If a House Doesn't Have Everything On My List, I'm Not Looking At It."

You should make a "needs" and "wants" list of what you want in a home. But don't turn it into strightjacket. It should be a guide to help you find the home with the right balance of features.

You need to prioritize your list to make sure it guides you to the right home and not keep you from it.

Not sure what should go on your list? This worksheet can help you get your priorities straight: The Ultimate “I Wanna Buy a House" Checklist.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

The 5 Most Important Home Closing Terms

by Rebecca Shahan
Buying a home can be a confusing process. This is especially true for first time buyers. All those words! But don't worry, that why you hire a professional to help you figure it all out. Still, there's some basic terms that you should familiarize yourself with, especially when closing a home sale.
 
Here's the 5 most important closing terms you should know.
  1. Down Payment Simply put, this is the amount of money you pay up front for a mortgage, just like buying a car. Most mortgage lenders require between 3% - 20% down payment. In the case of VA or government assisted loans, this amount can be less.
  2. Private Mortgage Insurance (PMI) – You may be required to pay for private mortgage insurance when you take out a loan if you put down less than 20%. PMI protects the lender in case you end up foreclosing on your home.
  3. Annual Percentage Rate (APR) – APR refers to the total cost of taking out a loan. It can include broker fees, interest rate, points, and others.
  4. Loan Estimate (LE) – A loan estimate deals with the estimated closing costs, along with the terms of the loan that you agreed to.
  5. Closing Costs – Closing costs are paid by both the buyer and seller. These costs can cover application fees, property fees, title examination, title insurance, attorney charges and settlement documents.

Of course, this only scratches the surface of what you should know about buying a home. 

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

5 Tips For First Time Home Buyers

by Rebecca Shahan

5 tips for first time home buyersIf you're ready to buy your first home, no doubt you've realized already there's a lot of things you need to think about. It can seem overwhelming. But it doesn't have to be.  Millions of people have bought homes before, and we know what makes the process go more smoothly. All it takes is planning and patience.

There are some simple steps you can take to make sure your home buying experience goes more smoothly. Here's a few things to think about before you decide to buy.

How Much Home Can You Afford?

Like any purchase, you need to know how much you can afford. It can be disappointing to find out you can't afford the home you fall in love with. The best thing to do is to determine the maximum amount you can afford.  An online mortgage calculator is a great way to start. You can find out your maximum price limit based on a 30 year mortgage.

You can also pin down a more exact amount of what you can afford is to talk to a loan officer at your bank. A loan officer will have a better idea of what the bank will loan you and what your down payment will need to be.

Knowing how much you can afford in advance, along with being pre-approved for a loan, will give you an advantage over buyers who haven't taken this step.  And it will save you time, since you know exactly what you can afford before you start your home search.

What Are The Must Haves In a Home?

Knowing what you want in a home, and what you don't want, is important. Sit down and think about all the things that you must have in a home, and the things that will make life miserable. Write it all down and use it in your home search. Show it to your agent as well so they know what to look for. You can adjust your list as you look at homes and see first hand what's available.

Use an Experienced Local Real Estate Agent

The right agent who knows the area inside and out makes a huge difference. Research the real estate agents in the are you're moving to.  If you have friends or family who've bought a home there recently, ask them for a referral. If not, read reviews online.

A good agent will know the area you're moving to inside and out, and will pay attention to your needs. In many cases, a great agent will have repeat clients over the years. They will also be able to connect you to loan officer and real estate attorneys, along with other needed professionals.

Compare Prices

You should look at homes in the area that are comparable to get an idea of what they're selling for.

You can easily compare homes in the area you plan to move to using tools such as our Home Search feature.

Ask Your Real Estate Agent About Closing Costs

Closing costs can vary, so make sure you determine the expected costs in advance to avoid any nasty financial issues during closing. Closing costs can include the costs of hiring an attorney to look over the  seller agreement, along with a home appraiser to inspect the home before the sale. A good real estate agent will be happy to help you determine closing costs.

Being a first time home buyer may seem daunting, but it's something you can accomplish successfully with the right planning and information.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.  

Hiring the right real estate agent makes all the difference in a successful real estate transaction in Lake Travis and Austin.

You also need to understand who's side an agent is on when you buy or sell a home and move towards closing.

There are a number of ways agents may represent clients.

By knowing where your agent’s loyalties lie, you’ll know what you can tell her and what you can’t. If, for example, you’re dealing with an agent who doesn’t represent you but is representing the sellers of a home you want to buy, you won’t want to tell her how high you’re willing to go on the price.

No matter what form of representation you agree to, or where you live, watch out for your own interests and understand the six ways brokers and agents represent clients below.

Buyer’s Agency

Do you want the agent to represent you and only you when you buy a home so that all the information you share with her is confidential? Opt for an exclusive buyer’s agent.

Who pays the buyer’s agent? Surprisingly, even if you hire a buyer’s agent, you can still ask the sellers to pay his fee. You can pay your buyer’s agent yourself, or ask the seller (or the seller’s agent) to pay your agent a share of their sales commission.

Seller’s or Listing Agency

An exclusive seller’s agent represents only the sellers, not the buyers. If your exclusive seller’s agent finds a buyer for your home, he may have another agent - maybe even a co-worker from the same brokerage - represent the buyer in your transaction. In some cases the buyer may have no agent at all. Your exclusive seller’s agent is loyal only to you, so it’s OK to discuss strategy with him.

Who pays the seller’s agent? The seller pays a commission to the seller’s agent from the proceeds of the sale. The seller’s agent may, and often does, share the commission with the homebuyer’s agent.

Dual Agency

In many states, agents can represent both the buyer and seller. These dual agents seek to bring both sides together. They can’t do something that’s only good for you and not for the other side.

A dual agent situation often arises when one agent represents the buyers and the sellers of the same home. The agent must disclose the relationship and, in many states, you must agree in writing to such dual representation because of the potential for conflicts of interest. While dual agents have an obligation not to share any confidential information of a client without their permission, be sure to inform the agent that the information is confidential and know that any non-confidential information may be shared with the people on the other side of the transaction.

Who pays the dual agent? Usually the seller pays the commission.

Designated or Appointed Agency

What happens when the buyer’s agent and the seller’s agent both work for the same broker?

To make sure both sides of the home sale are treated fairly in this situation, some brokers designate an agent in their company to represent only the buyers and another to represent only the sellers. A designated agent or appointed agent will be loyal to you and only you. The strategy helps avoid a dual agency situation.

Who pays the designated agents? The sellers pay the commission and the designated agents share it.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

Questions You Should Ask Before You Move Into Your Home in Austin

by Rebecca Shahan

If you bought a house with no maintenance issues big or small, that would be one for the record books. In reality, most homeowners find a problem, quirk, shortcoming, whatever, within the first couple of months.

And if you’ve already settled in, getting answers to these key questions will help you get to work putting the shine on your castle. Ask the previous owner, your agent, and your new neighbors for helpful answers.

Has There Ever Been a Busted Pipe?

A broken pipe isn’t rare; in fact, water damage caused by a frozen or burst pipe is a leading cause of homeowners insurance claims, at around 22% of all home insurance losses, according to the Insurance Information Institute.

What bursts? Typically exposed water pipes in unheated basements and crawl spaces, along with exterior faucets.

Another prime suspect of water damage: old washing machine hoses.

A good inspector usually can tell if water damage has occurred, and any damage should be disclosed by the previous owner at the time of sale.

The big fallout from water damage is moisture problems you won’t see — behind drywall and trim — which can lead to mold. If you know there’s been a major leak, a mold remediation pro ($200 to $600) will tell you if mold is present and the steps required to remove it.

Any Infestations of Termites, Carpenter Ants, or Other Pests?

This should be disclosed by the previous owner at time of sale. But even if the owner dealt with a past infestation, that doesn’t mean the little buggers have been totally eliminated.

Whatever conditions made your house ripe for infestation in the first place — a slow leak under the house, soft rotting wood that attracts insects — may still be present. Plus, many infestations aren’t confined to one house. It may be a neighborhood-wide problem.

Be proactive, because the average cost of a termite extermination treatment around the perimeter of a 2,500-square-foot house is $1,700 to $3,200. Repairs to wooden framing, sheathing, and siding can run from hundreds to thousands of dollars.

What are Monthly Utility Costs?

You can’t get away from paying utilities, so know what your monthly budget is up against. Be sure to get an average cost — not the lowest monthly bill — and ask when peak months are.

While you’re at it, ask what kind of energy sources your house appliances use — gas, electric, propane, or a combination. That’ll help you understand where you might upgrade to energy-efficient appliances to save energy costs.

Remember that energy savings starts with the simplest of tasks, like sealing air leaks.

Has the Sewer Ever Backed Up?

As properties age and trees and other plants get bigger, roots find their way into sewer lines between a house and the street, causing clogs. It’s a mess for sure, and most homeowner insurance policies don’t cover damage from backed-up sewers.

Plan to have the sewer line cleared (about $150) every other year.

For $40 to $50 per year, you can add an endorsement to your insurance policy to cover damage from a backed-up sewer.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

Common Myths That Are Costing You Time and Money

by Rebecca Shahan

You can’t swing a tool belt without hitting a website or TV network offering tips on taking care of your digs. Save money by watering your lawn at night! No, water it in the morning! No, dig it up and replace it with a drought-hardy meadow!

Throw in the info you pick up from well-meaning friends and there’s a sea of home care truisms out there, some of which can sink your budget.

Stone Countertops Are Indestructible

Marble, quartz, travertine, soapstone, and limestone can all be stained. Regular household cleaners can dull their surfaces over time. And marble is maddeningly fragile — it’s the prima donna of stone.

It’s easy to scratch. It’s easy to stain. Here’s the worst part: Mildly acidic substances like soda, coffee, lemon juice, even hard water will eat into marble, creating a cloudy, dull spot in a process known as etching.

Spill a glass of wine on a marble counter and go to bed without cleaning it, the next morning you’ll have a problem. And while stone counters won’t crack under a hot pot, such direct heat can discolor quartz or marble. So be nice to your counters, no matter what they’re made of. And note that the best rock for your buck is granite. It doesn’t stain or scratch. It’s tough because it’s volcanic rock. Which means it can stand up to all the merlot and barbecue sauce you can spill on it.

Your Smoke Detector's Test Button Is Foolproof

The test button doesn’t tell you what you really need to know. Yes, check your smoke detector twice a year. But all that test button will tell you is whether the alarm sound is working, not if the sensor that detects smoke is working. Pretty key difference there.

The best way to check your device is with real smoke. Light a long, wooden kitchen match, blow it out, and hold it near the unit. If the smoke sets off the alarm, it’s working. If not, replace the batteries. If it still doesn’t work, you need a new smoke detector. And replace those batteries once a year anyway, because dead batteries are the No. 1 reason smoke detectors fail.

A Lemon Is a Great Way to Clean a Disposal

 While wanting to use natural cleaners is admirable, all of them will damage your disposal and pipes over time.

The lemon’s acidic juice will corrode the metal parts of your disposal. The mixture of salt and ice contains metal-eating acid, too. The coffee grounds are abrasive enough to clean the gunk off the blades and make it smell like a cup of americano, but they’ll accumulate in pipes and clog them.

The best natural cleaner for your disposal is good old baking soda. It’s mildly abrasive so it will clean the blades, but it’s a base, not an acid, and won’t damage the metal. Best of all, a box with enough baking soda big enough to clean your disposal twice costs less than a buck.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

Tips to Determine How Much Mortgage You Can Afford

by Rebecca Shahan

Owning a home should give you safety and security, and that includes being financially secure. Before you buy a home, you should calculate how much you can afford for a mortgage and make sure it fits safely withing your budget.

Prepare a Detailed Budget

The standard rule of thumb says that you can afford a home that costs 2 to 3 times your gross income for one year. In other words, if you earn $100,000 in a year, you should be able to afford a home between $200k to $300k.

There is one problem with this rule. It doesn't factor in your monthly expenses and debts. If we use our previous example of $100k per year income, and you have $1000 monthly debt payments, this leaves you with less money to pay the mortgage.

You should prepare a family budget that takes into account your ongoing monthly bills for everything — credit cards, car and student loans, lunch at work, day care, date night, vacations, and savings.

Now you can see what's left to cover the costs of owning a home, such as your mortgage, property taxes, insurance, maintenance, utilities, and community association fees, if applicable.

Factor in Your Downpayment

Having enough for a down payment is also an important factor to consider. It's simple: the higher the down payment, the lower your monthly mortgage costs will be. If you put down at least 20% of the home’s cost, you may not have to get private mortgage insurance, which protects the lender if you default and costs hundreds each month. That leaves more money for your mortgage payment.

The lower your down payment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment.

But, if interest rates and/or home prices are rising and you wait to buy until you accumulate a bigger downpayment, you may end up paying more for your home.

Consider Your Overall Debt

Lenders generally follow the 43% rule. Your monthly mortgage payments covering your home loan principal, interest, taxes and insurance, plus all your other bills, like car loans, utilities, and credit cards, shouldn’t exceed 43% of your gross annual income.

Here’s an example of how the 43% calculation works for a home buyer making $100,000 a year before taxes:

  1. Your gross annual income is $100,000.
  2. Multiply $100,000 by 43% to get $43,000 in annual income.
  3. Divide $43,000 by 12 months to convert the annual 43% limit into a monthly upper limit of $3,583.
  4. All your monthly bills including your potential mortgage can’t go above $3,583 per month.

You might find a lender willing to give you a mortgage with a payment that goes above the 43% line, but consider carefully before you take it.

Use Your Rent as a Mortgage Guide

If you currently are renting, then you can use an online calculator to compare the costs of renting vs owning a home to see which makes the most sense for your financial situation.

If you’re struggling to keep up with your rent, buy a home that will give you the same payment rather than going up to a higher monthly payment. You’ll have additional costs for home ownership that your landlord now covers, like property taxes and repairs. If there’s no room in your budget for those extras, you could become financially stressed.

Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser, or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

Negotiate Your Best House Buy in Austin and Lake Travis

by Rebecca Shahan

There can be a lot of emotional moments when buying a home in Lake Travis and Austin. But negotiating a price doesn't have to me emotional. You just need to stick to the plan. Your agent will guide you through this potentially turbulent time. Your agent may offer advice, but in the end, you're the one who makes the final decision.

Here are six tips for negotiating the best price on a home.

Get Prequalified for a Mortgage

When you prequalify for a mortgage, it shows seller that you mean business and can afford to buy their home. This also puts you ahead of those buyers who may not be prequalified.

Ask Questions

Questions are your best friend. You need to know many things about the home and seller your interested in. What's the seller's motivation for selling? What is their financial position? Are they facing foreclosure or a short sale? Have they already purchased a home or relocated, which may make them eager to accept a lower price to avoid paying two mortgages? Has the home been on the market for a long time, or was it just listed? Have there been other offers? If so, why did they fall through? The more signs that sellers are eager to sell, the lower your offer can reasonably go.

Work Back From a Final Price to Determine Your Initial Offer

You should know in advance what you're willing to pay. Then you can work back from that number to make an initial offer. If you bid too low, you may offend the seller. If you bid too high, you may end up spending more than you need to.

You agent can work with you to compare homes in area that have sold recently to come to a fair initial offer.

Avoid Contingencies

Sellers don't like taking chances. Nobody does for that matter. So keep the bid free of complicated contingencies, such as making the purchase conditional on the sale of your current home. Try to keep contingencies for mortgage approval, home inspection, and environmental checks typical in your area, like radon.

Remain Unemotional

Remember that buying a home is a business deal. Treat it that way. Consider any movement by the sellers, however slight, a sign of interest, and keep negotiating.

Each time you make a concession, ask for one in return. If the sellers ask you to boost your price, ask them to contribute to closing costs or pay for a home warranty. If sellers won’t budge, make it clear you’re willing to walk away; they may get nervous and accept your offer.

Don't Let Competition Change Your Plan

Great homes and those competitively priced can draw multiple offers in any market. Don’t let competition propel you to go beyond your predetermined price or agree to concessions — such as waiving an inspection — that aren’t in your best interest.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

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