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A Primer for First-Time Homebuyers

After having waited on the sidelines for what seemed like forever, first-time homebuyers last year made 38 percent of all U.S. single-family home purchases - the biggest share since 2000 - and the 2.07 million new or existing houses they bought ended up being 7 percent more than in 2016, Bloomberg.com reported.

"Pent-up demand" is how the news site described it, citing Millennials as one of the driving forces.

But the market for house-hunting newbies like yourself has changed considerably from that most recent high mark of nearly two decades ago. And you know what they say: "Forewarned is forearmed." Read on.

* Inventory is tight.

So tight, in fact - especially for lower-priced starter-homes - that, as the Wall Street Journal wrote, even "buyers in historically calm markets such as Boise, Idaho, and Minneapolis are facing bidding wars, prompting them to dig deep into their coffers to win deals."

Not into bidding wars? Well, there's always Little Rock, Arkansas.

Unlike Denver, Seattle and San Francisco - which LendingTree named the "most challenging" cities in the nation for first-time buyers - Little Rock was rated a veritable paradise for house hunters.

* There's still a lot of all-cash buyers out there, so don't be afraid to get creative.

Though the number of all-cash transactions peaked at 40 percent in 2011 and 2012 - with savvy investors still taking advantage of the subprime mortgage crisis by buying up homes many then rented out - last year's 28.8 percent figure remains above normal. (One reason for the tight inventory: "Investors (are) making too much money as landlords to sell," according to MarketWatch.com.)

Granted, you're at a disadvantage if someone else waves $500,000 in cash in front of a seller even if you arrive pre-approved for a mortgage. However, HDTV.com tells the story of a couple who got a "great deal" on their Denver home - yes, Denver - by adding a contingency to their $300,000 bid that they'd pay $1,000 over any other competing offer up to a maximum of $329,000.

"Although unconventional," the site admitted, "a creative strategy like this can be very effective in today's market."

* Don't automatically reject a fixer-upper because you're not handy enough to fix things like the roof.

Everyone knows you can save a bundle by buying a house that needs work, but some things - including electrical system overhauls and extensive roof repairs - are safer left to the pros. So the question becomes this: How far ahead would you come out, financially, after deducting those costs from the house's likely post-renovation market value?

"An attractive roof is the ultimate curb enhancer, so it's important to figure that into your calculations," said Patsy O'Neill, a sales associate with Sotheby's in Montclair, New Jersey.

You can play around with different looks (i.e., Victorian vs. ranch) by using the free Virtual Home Remodeler launched by GAF (gaf.com), North America's largest roofing manufacturer. And the website's GAF Master Elite Contractor database can help you find the most reputable and adequately insured professionals in your area.

* You may be being watched.

Literally.

With owners leerier these days of strangers walking through their properties, they're increasingly employing devices capable of tracking prospective buyers' conversations and actions.

Yes, it can be creepy. The bigger danger, though, as MarketWatch.com noted, is that - if you don't watch what you're saying - there's "a real risk" of tipping your hand enough that you wind up overpaying.

 

Defining Luxury: American Hardwoods

With color, texture and grain unique to each hardwood species, these magnificent products are as individual as you. And whether on the floor or over the fireplace, in the kitchen or in the office, they provide the opportunity and means to personalize each and every space. So step beyond cookie-cutter and ascend into lavish with the allure of cherry, the iridescence of sycamore, the elegance of walnut!

The appeal is real. Today's informed buyers recognize American hardwood as the gold standard, then and now! So isn't it time to realize your vision of luxury?

For answers and inspiration, visit the photo gallery of hardwood flooring, cabinetry, furniture and millwork at www.HardwoodInfo.com. And follow us on Facebook and Pinterest @AmericanHardwoods, and Twitter @AmericanHardwds.

Watch the video here.

Outdoor Spaces Offer Style And Comfort

Today's homeowners love being outdoors, and design professionals are being tasked with creating extravagant outdoor living areas with all the creature comforts that are typically found indoors - a task they're accomplishing with natural building materials such as cypress.

Mark Tuck of the Southern Cypress Manufacturers Association, www.CypressInfo.org, says, "Cypress is a beautiful wood that looks exotic. More importantly, it is a durable wood that - when properly installed and maintained - provides long-lasting performance. It's perfect for outdoor use!"

Unlike other species that need to be pressure-treated with chemicals for outdoor use, cypress comes by its durability naturally. When growing, cypress trees produce cypressene in their heartwood. This preservative oil protects the wood from the elements, and it repels insects such as termites and carpenter bees that often feed on and nest in other species.

"Thanks to its natural characteristics," Tuck adds, "cypress has typically been used as siding or as an outdoor ceiling product. But more recently, design professionals are using it for a variety of other outdoor applications."

Cypress for the Outdoor Floor

"Outdoor rooms, peaceful spaces, and low-maintenance materials are the buzzwords I hear most from my clients," says Nancy Moore of The Porch Company in Nashville, Tennessee.

"I like to use cypress in spaces that are exposed to the elements. From my experience, it holds up well to blowing rain that may come in. I love its character, authenticity, longevity, and the fact that it is a renewable resource."

Moore says that her clients prefer porch designs that flow from the inside to the outside, which includes the flooring.

"We typically use tongue-and-groove cypress for our porch floors because it makes the space feel like another room of the house - a room that just happens to have walls that breathe."

The New Heart of the Home

The heart of the home has long been the kitchen, right? So as today's homeowners spend more time outside, creating a secondary kitchen outdoors is a top priority.

When crafting cabinetry for outdoor kitchens, Rod Richardson of Associated Construction Group, Gonzales, Louisiana, relies on cypress, and for good reasons. "It offers value, appearance, and performance that lasts," Richardson says. "In my 20 years of building outdoor kitchens with cypress, I haven't had a callback.

"There are many building materials available, but one has stood the test of time and that's wood. It offers an appearance, feel, and even smell that you can't re-create with man-made products. And when I show customers different cabinet materials - even different woods - they usually lean towards cypress."

Incorporate cypress into your lavish outdoor space. See how at www.CypressInfo.org.

 

Yes, Homeowners, It’s Time to Prepare for Storm Season

Five to nine hurricanes - with as many as four "major" ones boasting sustained winds of 111-plus mph - is what the National Oceanic and Atmospheric Administration just predicted for this year's storm season. In other words, they're calling for an "active" six months or so through the end of November.

And while no one's saying we're in for a repeat of last season's devastating triple whammy - yes, we do mean Hurricanes Harvey, Irma and Maria - ask anyone still dealing with the havoc of having had their house battered in one of those storms if they don't still wonder what more they could've done to be better prepared.

"It only takes one storm to devastate a community," said Acting FEMA Deputy Administrator Daniel Kaniewski.

Read on for some of the best advice on readying for the next (inevitable) storm.

* Check your insurance. The coups de grace for many of those hit hardest last year was discovering that they'd have to find a way to pay all or some of their rebuilding costs themselves. The reasons ranged from lack of flood insurance (only those with federally backed mortgages living in designated high-risk zones are required by law to buy it) to a local spike in the price of labor and materials.

"Hurricane Harvey (in Texas) showed that flooding can also damage properties outside the highest-risk zones," the Wall Street Journal noted, quoting a former New York insurance commissioner as saying that "even financially literate people" don't understand that floods aren't covered in the standard homeowners policy.

* Clean your gutters. Even in perfect weather, Angie's List says you're looking at a possible "nightmare" if they're so clogged with mounds of leaves, sticks, and other debris that it causes your roof to leak. And if you factor in a hurricane-strength rain, suddenly the very roofing system component meant to control the flow of all that water - thus protecting your roof, walls, foundation, and landscape from the aforementioned flooding - can be about as useful as spoiled milk.

"If you let gutter cleaning go by the wayside, it could cost you hundreds of thousands of dollars," the website warned.

* Make sure your roof is in good condition. The Insurance Institute for Business and Home Safety actually built a test chamber where experts could simulate the effects of hurricanes and other natural disasters on full-scale one- and two-story homes. So when its president and CEO, Julie Rochman, tells CBSNews.com's "MoneyWatch" that "it all starts with the roof," you need to pay attention.

"The roof," she said, "is the largest potential opening on the house, and wind and water can do terrible things if they get through (it)."

Ergo, now's the time to have a professional roofing contractor check for (and fix) any signs of wear and tear like broken or missing shingles, fractured fiberglass mat, and loosening of the self-seal strip. These tell-tale signs, especially if they resulted from damage from hail, can be difficult to spot yourself. And if you do decide to replace your roof? "Consider shingles that have passed the UL2218, Class 4 impact test," advised Jason Joplin, program manager of CARE (the GAF Center for the Advancement of Roofing Excellence).

Joplin especially likes the Timberline ArmorShield II line of shingles from GAF (gaf.com), North America's largest roofing manufacturer. In addition to looking good, they're made with SBS modified asphalt, which he described as "a rubber-like material for enhanced flexibility and durability during extreme weather conditions."

An added bonus: Depending on where you live, shingles like these could help you qualify for significant discounts on your homeowner's insurance.

* Trim weak tree branches. Need we say more than people have actually died from trees and branches crashing into their houses?

 

Smart Millennial Uses Down Payment Assistance for New Home

"Yeah, I've been moving since I was 18," says Matt, "and I was getting sick of it. I'm really good at packing and moving, though. I've had lots of practice."

Part of the reason Matt moved so frequently was that he enjoyed getting to know different areas of Milwaukee, Wisconsin. It also taught him which neighborhoods he'd want to live in on a more permanent basis.

"After working in the mortgage industry for three years, I became very aware of what a smart financial decision it is to buy a home," explains Matt. So, he began house hunting while living with a roommate and paying $525 each for rent.

Because Matt owns a motorcycle, a house with a garage was a must. Unfortunately, the area he wanted was comprised of older homes - many without garages. And, he was unwilling to go above his price range.

As a young first-time homebuyer with student loan debt, Matt didn't want to overextend himself. He also didn't have enough in his savings for a 20 percent down payment. So, when he finally found his four-bedroom home with a garage, and in his price range, he decided to apply for a low-down-payment loan. His goal was to put down five percent and use private mortgage insurance, which is required on conventional loans with less than a 20 percent down payment.

Yet Matt was still a bit uncomfortable about using all of his savings for his down payment and closing costs. He had the money, but wondered what would happen if his bike or new home needed expensive repairs. Matt wanted to ensure that he still had a rainy-day fund just in case, so he researched down payment assistance programs.

While there are different types of programs available, Matt took advantage of the Easy Close Advantage - Down Payment Assistance program offered through WHEDA (Wisconsin Housing and Economic Development Authority). In order to be eligible, buyers must be purchasing an owner-occupied home in Wisconsin and meet specific requirements, such as income levels, credit ratings and home-purchase price limits.

Matt easily qualified for the program, and closed on his home in July 2018. His monthly mortgage payment is $1,292, which includes escrow and $59 for the down-payment-assistance loan.

But what does a smart millennial do with a big four-bedroom house and a lot of former roommates? Yep. Even though Matt could afford the mortgage himself, he invited two of his buddies to live with him. Now, his roomies pay $550 each per month and Matt pays only $192 of the mortgage, so he's saving money while building equity. As Matt confides, "I see this house as a really good investment."

And on top of that, he can finally get rid of his moving boxes!

For more homebuyer resources, visit readynest.com. To find down payment assistance programs in your area, visit downpaymentresource.com/

 

Your Attic Can Make Pre-Winter Roof Checkups Easier

That's right, your attic.

Think about it: No homeowner really wants to be climbing 25 feet or so into the air on a ladder when the weather is turning colder and nastier. But unbeknownst to many, your attic - which is a lot safer and more comfortable - can actually substitute, as a fallback, for the direct roof check experts recommend be done every pre-winter and spring to identify problems before they become even more serious headaches.

"Roofs actually create an insulated barrier that helps trap heat inside, and most attic spaces are located right below them," explains Jason Joplin, program manager of CARE (the GAF Center for the Advancement of Roofing Excellence). "That makes them perfect for spotting potential problem areas and damage without worrying about falling off a ladder."

Here's what to look for while you're up there:

* Water leaks. As sure as taxes will be due in April, it will storm. And when it does, shine a flashlight up in the attic to check not only for dripping water and condensation, but also for water stains on the ceiling, walls and floors. All are dead giveaways that H2O is finding its way beneath your roof's shingles or behind its flashings.

* Stuffed vents. There's a reason Joplin likens the attic to "the lungs of the house."

"It has to be able to breathe in order to function properly," he says.

Meaning, vents clogged with debris impede proper ventilation and need to be cleared. Unless, of course, you're okay with (among other things) higher energy bills.

* Animal damage. Yes, squirrels are cute - when they're frolicking on park lawns. They're not cute, however, when they (along with bats, birds and raccoons) wreak potential damage by using your home for refuge. You'll know if they've been hiding out by these telltale signs: nests, droppings, and gnawed wood, wires, or insulations.

First call on your list? A pest-control pro.

* Structural problems. The mere hint of a sagging roof - you'll need to look up for this - could indicate possible structural weakness requiring professional repair before the first snowfall adds any more weight to it.

And if your goal is prolonging your roof's life, you'll want to be sure any professional roofing contractor you consult is insured, factory-certified, and uses quality materials. Joplin, for one, recommends the latest triple-layer line of Glenwood Shingles - the thickest of its kind, with an authentic wood-shake look - from GAF, North America's largest roofing manufacturer. A free service that makes it easy to find a factory-certified contractor in your area can be found at gaf.com.

Oh, and just so you don't dawdle, here's the Farmer's Almanac's definition of a brutal winter: "very long, cold, and snow-filled."

Making the Most of a Mudroom

"While mudrooms are not a new amenity, they've moved up on the list of must-haves for today's homeowner," says Linda Jovanovich of the American Hardwood Information Center, www.hardwoodinfo.com.

"As the amount of residential square-footage dedicated to mudrooms has grown, so has the attention paid to their design and aesthetics. Solid hardwood built-ins not only provide the customization needed in what are sometimes awkwardly configured spaces, but also create the opportunity to bring the warmth and character of natural wood to what is first and foremost a service room."

Bob Near, renovation division director at Streeter & Associates, a Minneapolis-based home-building firm that installs myriad mudrooms, agrees: "For example, working with Peterssen/Keller Architecture and Eminent Interior Design, we recently completed a large mudroom with red-birch cabinetry, part of the makeover of a dated 1980s house. The client wanted a mid-century look, as if the room had been built in the 1960s, so its design is very clean." One wall is entirely floor-to-ceiling storage concealed behind plain slab doors; the other comprises a row of six locker-room-style open cubbies serviced by a single full-length bench.

"The client also asked for unstained wood rather than painted cabinetry, for reasons of durability and aesthetics," Near continues. "First, they felt a clear polyurethane varnish would hold up better than enamel paint to the wear and tear imposed by four active boys. And second, they wanted to give the somewhat austere space a more earthy, homey feel."

Easily applied by hand, the oil-based satin finish had the added advantage of deepening the tone of the red birch without changing its color, an important consideration because the wood had been carefully selected for its not-too-pink, not-too-green hue.

As a whole, the project could serve as a terrific checklist of best mudroom practices: With six cubbies, there's one to assign to each member of the family, who'll then have an easily accessed set of hooks on which to hang wet weather gear; a stretch of solid bench on which to sit and take off dirty boots and shoes that can then be quickly stored in the deep cubbies underneath; a handy drawer for smaller items that might otherwise get lost; and all delivered in a beautiful, red-birch package. Find a better example of flawless function married to fabulous form if you can.

Visit www.hardwoodinfo.com for more about mudrooms and other applications and products using American hardwoods.

 

4 Insider Tips for Anyone Buying or Selling A House

Yes, times are tricky for both buyers and sellers.

"Rising demand among millennials, full employment, and the strong economy have bumped against limited inventory," the Washington Post reported, "which fuels price increases."

What to do? Read on for some of the best insider tips.

* January and February are the best months to buy. Forget the "experts" who warn you shouldn't try to time the market. A recent study from NerdWallet shows houses typically cost 8.45 percent less during those two months than in June and August.

True, the pickings might be slimmer, given that most sellers list a house in the peak spring or summer seasons. However, not only are you less likely to be up against buyers with wads of cash - they're probably wintering in the likes of St. Barts - but you'll also stand to profit from a time-tested truth. "If their home is (still) on the market in fall or winter," notes the home improvement website BobVila.com, "chances are they'll be eager to close."

With the median price of homes currently listed in the U.S. at $275,000, that 8.45 percent "discount" translates into a very un-chump change savings of more than $23,000 - and a lot more in pricier cities like San Francisco.

Sellers, on the other hand, do best in the first half of May, according to Zillow.com.

* Generation Z is quick to buy. We hear so much about Millennials these days, but those born after 1995 caught Zillow's attention for a very good reason: When they buy, they buy "quickly."

More than two-thirds of those Gen Z buyers spent less than three months on their search, compared to 54 percent of Millennials and less than half of both Gen Xers (born between 1965 and 1976) and Baby Boomers.

One of the best ways to pique their interest? Smart home features that allow just about anything to be remotely controlled on their phones.

* A new roof is a sure-fire way to boost a home's resale value. A perennial fixture on Remodeling magazine's annual Cost vs. Value Report, roofs are often the first thing prospective buyers notice even before exiting their cars. And if yours pales in comparison to others up for sale in the area - or worse, looks like something out of "Twister" - that could explain the lack of nibbles.

Patsy O'Neill, a sales associate with Sotheby's in Montclair, New Jersey, has witnessed this effect first-hand.

"If your current roof is an eyesore," she says emphatically, "buyers will be predisposed to find other things they hate about your place. It's just the way people's minds work."

Your roof no longer cutting it? You might want to check out the popular Timberline roofing shingle line from GAF (gaf.com), North America's largest roofing manufacturer, given their look of luxury at affordable prices. An even more upscale choice: the Designer Shingle line from the same company.

* Play the online odds. "Studies show that homes with more than six listing photos online are twice as likely to be viewed by buyers," Trulia.com reports.

Of course, that only applies if the house you're trying to sell is photo-worthy. (See "New Roof" above.) And if it isn't … well, let's just say you might want to skip this tip.

Millennial Successfully Relocates And Buys Second Home at Age 25

The relocation shuffle 

Although Amy was perfectly happy with her first little house and made lots of friends in Grand Rapids, a job opportunity popped up that was too good to turn down. She recently relocated to Pittsburgh, where she serves as a regional sales manager for a major food distribution company.

Before her move, she experienced the ups and downs of both buying and selling houses in two different states. 

Selling a first home in Michigan 

"Lucky for me, Grand Rapids has a shortage of homes for sale and a lot of buyers. I didn't have a chance to make any improvements on my house, a farmhouse built in 1904, but I did add a simple deck and lots of flowers and new bushes. It has more curb appeal than when I bought it," Amy says. She says that the hardest part about selling a house was making sure it was clean all the time and ready for prospective buyers to tour.

Amy ultimately sold her house for $161,000, $21,000 more than what she paid in 2017. Even in that time, she accumulated some equity and walked away with a total of $28,000 when the sale closed. 

Buying a new house in Pennsylvania 

The next step was to find a house in Pittsburgh. Home prices are higher there, compared to Grand Rapids, Amy notes. She wanted to buy a nicer, more expensive home this time around.

"I found one that was a little bit above my price range at $200,000. But it's in perfect condition. I don't have to worry about repairs or anything," Amy says. Plus, coffee shops and restaurants are within walking distance.

She explains, "I could have used all of the proceeds from the sale of my house as my down payment. But I didn't want to drain my savings account. I used private mortgage insurance (PMI) again, so I could put less money down. I could have put 10 percent or $20,000 down, but I opted for a 5-percent down payment of $10,000 instead. My monthly payment is a little bit higher, but still affordable. Thanks to PMI, I could buy a bigger, better house and still have money in the bank."

Are you ready to buy a house right now? Or should you wait to save more for a down payment? Check out this calculator to find out: mgic.com/buynow. And for more information on how mortgage insurance can help you put less money down, go to readynest.com.

 

A Better Way to Buy and Own A Home

Questions plague homebuyers: Can we afford it? How much do we have to put down? Do we have enough to avoid incurring the dreaded PMI (Private Mortgage Insurance)? For homeowners looking to refinance, it becomes a question of, should we or shouldn't we? What's the down side? Does refinancing make sense in the long term?

In the past, consumers had only one option - taking on more debt. In addition to monthly payments with interest, this debt came with increased discomfort and the fear that "if we couldn't afford it, we could lose the roof over our head." Now, there may be another answer.

Home co-investing offers a new alternative - a better way to buy and own a home.

Home co-investing is a new category that works in partnership with homebuyers and homeowners to invest in the long-term appreciation of a home's value. Whether you're a homebuyer seeking to finance a new purchase or a long-time homeowner looking to maximize equity, home co-investing involves no monthly payments, no interest, and no additional debt.

Instead, home co-investing shares in the home's change in value - up or down. You can choose to return the investment any time after three years, or keep it until you sell, for up to 30 years.

"In a nutshell, we're in business to partner with you in your new or current home," according to the website for Unison, the company that invented this idea. The growing, San Francisco-based home co-investing company is now helping homebuyers and owners in 30 states plus Washington, D.C.

Unison's recently published 2019 Home Affordability Report states that individuals earning the current median income will need 14 years to save for a 20-percent down payment. Home co-investing benefits new buyers by helping them get over that first hurdle of the down payment. For example, with home co-investing, prospective buyers can put down 10 percent, and the company puts down 10 percent. The homebuyer can now reach a 20-percent down payment without taking on additional debt.

"Among the biggest financial mistakes potential buyers can make during the home-buying process is not researching all possible financing options beforehand, including home co-investing," says Cari Jacobs, Chief Marketing Officer at Unison.

"Think of it as the sharing economy for home buying. By partnering with a company like Unison, you can live the life you want, in the home of your dreams today, while sharing the risk," she explains.

"It's always better to have more information so you can make a fully informed decision that helps you buy the home you want, and sets you up for long-term financial success."

Home co-investing works for current homeowners, too, with opportunities for home equity-based funding for a variety of needs, including home renovations, paying medical bills, or even sending kids to college. But unlike a traditional home equity loan, there is no additional debt and no monthly payment.

Home co-investing represents a new way to think about home financing.

Visit unison.com for more information.

 

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