The New Rules on Tapping Home Equity Today—and Some Common Mistakes To Avoid

Homeowners across the country are sitting on a record amount of home equity.

Home equity refers to the difference between the current value of a home and how much is still owed on the mortgage. Therefore, if you have a house worth $400,000 and you’ve paid $100,000 toward your mortgage, your equity is equal to 25%.

As a share of total real estate value in the country, home equity has risen along with home prices to currently hover at 70.5%—its highest level since 1984. To put that number in perspective, 10 years ago, in 2012, home equity hovered at just 46%.

“For over a decade, home prices have climbed consistently, with an acceleration to a double-digit pace over the most recent two years,” notes Realtor.com® Chief Economist Danielle Hale. This, in turn, has helped push the total value of owner-occupied real estate in the United States to a new high of $41.2 trillion.

So, with homeowners sitting on a healthy amount of home equity, is now a good time to tap into that wealth?

It’s a reasonable question, particularly if you’re worried about inflation, a looming recession, job loss, or one of many economic uncertainties dogging Americans today. Currently, consumer debt is $320 billion higher than a year ago, and combined with tumbling mutual funds and stock market holdings ($4.2 trillion lower than last year), people may need some extra cash.

“Tapping home equity, which is generally available at lower rates of interest than personal loans or other types of lending, can make sense to fund investments such as home improvement, education, or starting a business,” says Hale. “But it’s important to remember that these loans will need to be paid back, either with proceeds from the sale of the home or with other funds if you want to continue living there.”

While it’s oh, so tempting to unlock that capital, just remember you’re not only increasing your debt load, but you’re also reducing the equity you’ve built. Nonetheless, there are smart ways to go about using that money, and smart reasons to do so as well.

“It’s always a good time [to tap into equity] if it is to reduce other debt or pay for improvements,” says Rocke Andrews, mortgage broker and owner of Lending Arizona in Tucson.

“With the short-term rates going up due to the actions of the [Federal Reserve], your other consumer debt may be going up quickly also: the cost of car loans, of credit card interest. So don’t lose sight of the savings that you can get,” adds Andrews. “Just the psychological relief of not having to worry about paying those bills every month is well worth it.”

That said, skyrocketing interest rates are not only boosting the borrowing costs on mortgages, but raising rates across the board for home equity options, too. This is prompting changes in the way that homeowners are choosing to tap into the real estate capital they’ve amassed over the years.

So here’s a guide to some of the new rules on tapping home equity today.

The New Rules on Tapping Home Equity Today—and Some Common Mistakes To Avoid

Ways to tap into home equity—plus, the pros and cons

If you are thinking of pulling money out of your house, there are three options most homeowners turn to.

Cash-out refinance

A cash-out refinance involves refinancing your existing mortgage for more than what you originally owed on the house and taking the difference in cash. True to its name, you are “cashing out” some of the equity in your home in order to get the larger mortgage.

For example, say you had a $300,000 loan, on which you still owe $200,000. That would mean you have $100,000 in equity in your house. Maybe you want to pay down some credit cards or college tuition, so you cash out $25,000 of that equity and get a new mortgage for $225,000.

If your property has risen in value (as most do over time), this also increases home equity. Let’s say your home’s value has risen from $300,000 to $325,000 since you bought it. If, as in the previous example, you owe $200,000 on that loan, you could cash out $25,000 but essentially still keep the same mortgage payment on $200,000 while pocketing $25,000.

The interest rate on a cash-out refinance is fixed, making monthly payments easier to factor into the budget.

Cash-out refinances are a good option for homeowners who want only one mortgage to keep track of and pay off, and also for those who may not have a great credit score. Because they are federally backed by Fannie Mae, Freddie Mac, the Federal Housing Administration, and Veterans Affairs, refinances have less stringent credit score requirements and underwriting than other methods of borrowing against your house.

The process for a cash-out refinance is similar to refinancing a mortgage, but homeowners usually end up paying more in interest after a cash-out refinance over the long term, because they’re increasing not only the amount but also the length of their loan. (For example, if you were already 10 years into a 30-year loan, refinancing for another 30 years means you’ll be paying for 10 years longer than had you kept your original mortgage.) And like a typical mortgage process, they will be paying closing costs, which is typically anywhere between 3% to 5% of the new loan amount.

A year ago, cash-out refinances made up a majority of equity withdrawals thanks to record-low mortgage rates. But with the average rate on a 30-year fixed mortgage topping 7% in October, which is pushing all rates up with it, a cash-out refinance makes less sense today.

“As interest rates climb, a cash-out refinance—which resets the rate on the total outstanding loan balance—makes less financial sense for many households,” Hale says. “Instead, households are more likely to use home equity loans or lines of credit, which enable them to tap only a limited amount of equity at today’s mortgage rates, keeping the rest of their mortgage debt at their current presumably lower rate.”

According to the August 2022 Housing Finance Policy Center’s Chartbook, “Higher rates this year have also forced a sharp cutback in cash-out refinances, which had soared in the last two years as some homebuyers used the refinance opportunity to extract equity.”

“Rising mortgage rates have served a body blow to overall refinance activity in 2022,” says Nik Shah, CEO of Home.LLC. “Cash-out refinance activity has dropped significantly in response. Cash-out refinance volume in the second quarter of 2022 is down by an estimated 44% from a year ago.”

Home equity loan

Similar to a cash-out refinance, a home equity loan allows you to borrow against the equity in your home. The biggest difference is that while a cash-out refinance replaces your existing mortgage with a new one, a home equity loan involves taking out a second loan on top of your first.

The interest rate and payments on a home equity loan are fixed, meaning the rate doesn’t change and homeowners will be taking on a steady loan payment each month.

Most mortgage lenders will allow homeowners to borrow up to 80% of their home equity in the form of a home equity loan. For example, if your home is worth $400,000 and your mortgage balance is $200,000, you have 50% equity in your property and would be able to borrow up to $120,000. (You can crunch your own numbers with an online home equity loan calculator.)

Home equity loans tend to have higher credit score requirements and more stringent underwriting compared with a cash-out refinance. But they’re a good option for homeowners who don’t want to touch the great rate on their first mortgage.

“If your current mortgage rate is low, you don’t have to give that up [with a home equity loan],” says Joe DeMarkey, strategic business development leader with Reverse Mortgage Funding in Holliston, MA. “And if you use the loan for home improvements or renovation, the interest may be deductible.”

One thing to keep in mind is that with a fixed-rate loan like a home equity loan, you will pay interest on the entire loan amount—even if you’re using it incrementally, such as for home renovation.

And if you do end up selling your house, the balance on the home equity loan will be due in full.

Home equity line of credit (HELOC)

Similar to a home equity loan, a home equity line of credit (also known as a HELOC) allows homeowners to borrow money and essentially open up a line of credit using the equity in their home as collateral.

The biggest difference between a HELOC and a home equity loan and a cash-out refinance is that a HELOC acts like a credit card. Once approved, homeowners can borrow on an as-needed based, up to the loan’s limit, over and over again through the term of the loan (typically five to 20 years).

Most mortgage lenders will allow homeowners to borrow up to 75% to 85% of a home’s value, minus what they still owe. For example, if your home has been appraised at $500,000 and you still owe $200,000 on the mortgage, the bank will calculate 75% of the value ($375,000 in this case) and then subtract $200,000 (the amount you still owe). They would then set up a HELOC with a $175,000 limit that you can borrow against over time.

Homeowners pay interest only on the amount they borrow over the life of the loan. So if they borrow only $5,000 of their $35,000 credit limit, they pay interest on only $5,000.

The benefit of a HELOC is the flexibility of opening what is essentially a revolving line of credit, which is great for those who aren’t sure how much money they need to borrow, or when they’ll even need to use it. For instance, if you’re planning a home remodel and the project is expected to take six to eight months, you can open a home equity line of credit and pay the contractor over the course of the project, as bills come due.

They’re a great “rainy day fund you can tap into,” says Amit Gandhi, an independent loan originator and financial adviser in the Dallas-Fort Worth Metro area, who is an advocate of taking out a HELOC before you need one because there is no way to predict what the real estate market will do tomorrow.

“It’s the cheapest form of credit that you’ll ever have aside from a 0% credit card,” adds Gandhi.

Brad Cahoone, mortgage broker, banker, and president of Global Home Finance in Lewisville, TX, says a HELOC is good for someone who needs a large amount of money right away (they take as little as two weeks to obtain), and they want to be able to use the line of credit over and over again without having to go through the mortgage process repeatedly.

The other benefit of a HELOC: Because they’re a bank product, they don’t include the closing costs associated with refinancing or a home equity loan.

The big downside of a HELOC is that the interest rate is not fixed and may adjust (and go up) over time.

“With a HELOC, your rate can keep going up every month or every time the Federal Reserve raises rates. Your rates are not locked in,” warns Andrews, of Lending Arizona. For this reason, Andrews is an advocate of a home equity loan over a home equity line of credit due to the fixed interest rate. That said, if you need the money fast and/or aren’t sure how much you’ll need over time, a HELOC trumps a home equity loan in terms of speed and flexibility.

Although home equity loans and HELOCs each come with their unique pros and cons, both are increasingly popular options today, particularly compared with cash-out refinances.

How to refinance your mortgage | CNN Underscored

Mistakes to avoid when tapping into home equity

The No. 1 advice right now: If you’re even considering tapping into your home equity in the next year or two, do it now before the rates go up even further—or before home prices start to come down, even slightly.

“You don’t know what the real estate market is going to be tomorrow,” Gandhi says. “With home prices, we’ve seen them plateau in the last two months, and in some markets, they’ve declined steadily. Nothing to be frantic about, but houses are sitting on the market longer now. What’s that going to do to home values? It’s going to start pulling back a little bit. It’s not going to be worth as much as it was last year.”

He notes that homeowners considering tapping into home equity ideally should catch it at the peak of home values.

Perhaps what’s more important is to consider what you’re using the money for in the first place. Using it to pay for home improvement, investments, college tuition, and higher-interest debt all make sense. Using a home equity loan to buy a boat? Might not be the smartest move.

“The mistakes that people make today versus decades ago is they are cashing out equity for things that may not bring value,” says Eric Jeanette, president of Dream Home Financing in Freehold, NJ. “Using your home like a piggy bank to buy a [new] car is not a smart financial decision, but consumers are doing more of this than in the past.”

If, however, the goal is to pay off higher-interest credit cards or other debt, then tapping into equity and taking out a loan or line of credit definitely makes sense, says Ralph DiBugnara, mortgage banker, real estate investor, and president of Home Qualified in New York City.

“People are so stuck on these lower mortgage rates that they don’t want to touch their first mortgage,” he says. But this doesn’t make sense if “they’re paying credit cards at 16%. We have to be smart and consider if a cash-out refi makes sense to pay off the higher-interest credit card.”

If you are considering tapping into home equity in today’s market with rising interest rates, two of the most important things you can do as a homeowner is to compare lenders and see where you can get the best terms and rates. And with a recession looming on the horizon, it’s smart not to overextend yourself financially.

“It’s important to only borrow as much as you will actually use, so that you don’t end up paying more in interest than necessary,” says Josh Craven, mortgage adviser and CEO of SprintFunding.com in Bonsall, CA.

Hale agrees, adding, “Increasingly, homeowners are choosing to tap smaller amounts of equity so that they can keep balances at lower [levels].”

 

For this and related articles, please visit Realtor.com

/by

How To Buy and Sell a Home at the Same Time—in Today’s Haywire, High-Interest-Rate Housing Market

Buying a house while simultaneously selling your current home is always a treacherous tight wire to traverse—but in today’s high-priced, high-interest-rate housing market, it’s both a blessing and a curse.

The good news for home sellers is that over the past year, demand for homes has driven prices through the roof, pushing home equity to record levels. Homeowners are essentially sitting on a pile of cash, which would definitely come in handy if they start shopping for a new home.

Yet any homebuyer out there today will also face steep mortgage interest rates, which have more than doubled over the past year to the 7% range. This has raised the cost of housing by around 70% compared with a year earlier, according to a recent analysis by Realtor.com® Chief Economist Danielle Hale.

Most sellers who move would need to get a new mortgage, at a higher rate. It’s no wonder, then, that many are deciding to stay put.

“Two-thirds of homeowners right now are sitting on a sub-4% mortgage, and about a quarter are sitting on a sub-3% mortgage,” says Lisa Sturtevant, chief economist of the Bright MLS. “And so you can imagine existing homeowners, even if they wanted to move, are really reticent to give up their very favorable mortgage rate. It’s like golden handcuffs where you’re locked in.”

Still, it’s worth noting that some home sellers might be able to justify and absorb the higher interest rates since their home sale will likely bring a windfall of cash. And in theory, that money could go toward making an all-cash offer on their next house—and getting a very good deal on it, too.

“With home prices still high and buyer competition thinned out due to high mortgage rates, it may be a good time for some sellers to make a move, especially those who may not need a mortgage to make their next home purchase,” says Hale.

Still, an all-cash offer is a lot of financial eggs in one big basket. Is it worth the risk?

If you’re one of these homeowners sitting on a nice chunk of equity and looking to sell your house and buy another at the same time, there are ways to navigate today’s current financial terrain to your advantage.

How To Buy and Sell a Home at the Same Time—in Today’s Haywire, High-Interest-Rate Housing Market

Should home sellers buy or sell first?

The first question most home sellers ask themselves is: Should I buy or sell first? Each decision comes with its distinct pros and cons.

“Buying first gives you an opportunity to move out before putting your prior home on the market,” Hale says.

This helps a seller avoid the headaches of living in a home that is for sale, which means keeping it in pristine condition and being ready to vacate often (and at short notice) when buyers want to stop by for a tour.

On the other hand, “Selling first lets you know just how much you’ll make on the sale before shopping for your next home,” Hale says. “But it may mean finding a temporary place to live in between.”

Hale suggests asking yourself the following questions if you’re planning to sell and buy at the same time:

  • Where do I want to live next?
  • How disruptive will it be to have the home I live in on the market?
  • Can I handle the possibility of two mortgage payments—and if so, for how long?

While buying first allows you to avoid the annoyance of finding temporary living quarters and moving twice, it’s definitely more risky financially.

If your old property does not sell quickly, you could end up paying for two properties at once. This is a particularly strong possibility right now, since homes are lingering longer on the market than they did last year, and the market is bound to get even more sluggish if mortgage interest rates remain high and as we glide toward (and beyond) the holidays.

Options for sellers who want to buy first

For those who do want to buy first, “there is some risk, but also some great upside if done correctly,” says Mark Hardy, managing partner at Churchill Morgage in Orange, CA. “There are bridge loans that will allow for short-term use of equity from your current property to serve as a down payment for the next property if this is needed. This can position you to make a noncontingent offer and secure a much better price or better terms.”

Current rates on bridge loans range from 6% to 16% with the idea that you’re paying off the loan as quickly as possible, as soon as your original house sells.

Homeowners who want (or need) to sell quickly (because you’ve bought a new home or for other reasons) also have many new options today for getting a sale through fast.

“One bright spot for today’s sellers is that there is much more innovation in the real estate landscape and ways to get assistance with buying and selling at the same time than ever before,” Hale says.

For instance, sellers can skip the traditional listing process entirely and field offers from investors and iBuyers who’ll buy their home quickly with all cash. (These options are explained in more depth at Realtor.com Seller’s Marketplace.)

Options for sellers who want to sell before buying

For homeowners who prefer to sell first, one way to avoid moving into temporary accommodations is to negotiate a lease-back from your home’s buyers—where they agree to let you remain in your current home, paying rent, until you find a new home you want to buy.

Just keep in mind that, even after your home sells, it may be a while before you see that money.

“Getting the proceeds from the sale of your home can take some time, maybe longer than you expect,” warns Hale. “So if you’re trying to time the purchase and sale of a home, be sure to allow enough time for the proceeds from your home sale to be in hand before you schedule your closing purchase.”

Should sellers make an all-cash offer if they can?

If you’ve built up some sizable home equity and your home sale gives you enough to make an all-cash offer on your next place, that’s an attractive prospect in today’s high-interest-rate environment. It can also get you a deal since all-cash offers typically result in a 3% to 4% discount over a financed offer, Hardy notes.

An all-cash offer might also be tempting to try since it will likely set you apart from any competition you may have from mortgage-backed buyers. That said, you should not feel the need to funnel all your proceeds into an all-cash offer if that makes you uncomfortable or stretches your finances too thin.

“Don’t pay in all-cash because you think you have to be the most competitive offer,” Sturtevant says. While all-cash offers ruled during the ultracompetitive market last year, that’s no longer the case today.

Another option that’s less risky but still helps your offer stand out is to finance a smaller portion of the property.

“If there’s an opportunity to put 50% down, it makes it a little bit easier to swallow that bitter pill of a 7% mortgage rate if you’re financing a lower loan,” says Sturtevant.

Hale adds that “with mortgage rates near two-decade highs, minimizing the amount of borrowing you need to do to buy a home can make a big difference.”

Another option is to make an all-cash offer, then get a mortgage on your home later once interest rates go down.

An alternative to all-cash offers: Become a certified homebuyer

Homebuyers without as much equity built up in their home have other ways to keep their offer on new homes competitive. Hardy points to the strategy of becoming a “certified homebuyer,” which allows sellers to close quickly, without the need for a loan contingency.

Similar to a mortgage pre-approval process, the process of becoming a certified homebuyer requires proof of income, assets, employment, identity, and credit score. The difference is that all financial documents are reviewed by an underwriter, which gets you conditionally approved for financing.

“We’ve found this is a great way to help a seller feel very comfortable in accepting our client’s offer and secure terms quite close to what a cash offer would receive,” Hardy says. “The end result is that a buyer can better use the cash—and can now reinvest as desired—and has also purchased a new property at a much better price.”

 

For this and similar articles, please visit Realtor.com

/by

Six Home Renovation Mistakes People Make in the Winter

Renovating a home, no matter the time of year, can be equal parts exciting and overwhelming. However, renovating in the winter may come with its own set of additional issues.

Exterior renovations are especially risky during the colder months since the ground at your construction site can be slippery and wet. Plus, you need to take holiday travel schedules, inclement weather, and freezing temperatures into consideration. All of this can make finishing your remodel on time even more challenging than it already is.

To help you better prepare for wintertime home revamps, we tapped a few experts and asked them to divulge the most common missteps homeowners make. Avoid these mistakes when diving into a wintertime home renovation.

1. Choosing the wrong materials and equipment

It’s important to keep in mind that plastic window sealants might not stick and timber might expand when it’s freezing.

(Getty Images)

Not all materials can withstand freezing temperatures and snowy conditions.

“Choosing materials that will stand up well against colder temperatures and adverse weather conditions is essential,” says James Leroy, contractor, owner, and founder of Pro Home Remodeling in Tigard, OR.

For instance, keep in mind that plastic window sealants might not stick and timber might expand when it’s freezing.

“Do some research before starting your project,” says Leroy. “And make sure you have everything you need before getting started—including plenty of spares.”

2. Not paying attention to electrical safety hazards

Working with electricity in the winter can be dangerous if there’s recent heavy snowfall. Circuits and fuses can malfunction when wet, and poorly insulated wires can become damaged from low temperatures.

Downed power lines on your property might also be energized and cause electrocution if touched.

What’s more? Snowstorms often cause power outages that could prevent work from getting completed.

3. Not taking snow and ice into consideration

Ice debris, from roofs and scaffolding, can fall and injure workers when outdoors.

(Getty Images)

We all know wintertime weather means having to contend with snow and ice, but many homeowners underestimate just how these factors will affect construction projects.

“Just because it’s cold outside doesn’t mean you can’t do any renovation work,” says Leroy. “But you need to consider that temperatures will be lower than usual and that snow and ice can cause problems.”

Snow and ice around the outside of the home can create slick surfaces that could cause slips and falls. Ice debris, from roofs and scaffolding, can fall and injure workers when outdoors. And icy temperatures can also increase the risk of cold stress-related injuries like hypothermia and frostbite.

Try to plan your work schedule around the weather, but if you must continue on, dress appropriately.

4. Forgetting about holiday schedules

Zach Barnes-Corby, head of construction at Block Renovation in New York City, says that preparation is key.

“This is true for renovations generally speaking, but particularly true during the winter,” Barnes-Corby says.

Holidays and travel schedules can cause disruptions to your scope of work.

“You don’t want things being held up because a shipment of tiles got stuck in the holiday rush, or your contractor is set to travel halfway through your project,” Barnes-Corby says.

Barnes-Corby advises getting ahead of the holidays when planning a home renovation. Many contractors and suppliers close around the holidays, but planning well can help avoid any headaches.

5. Not making indoor space available for subcontractors

During the winter it can be very cold, so tradesmen will need space in the house to set up and run their tools.

(Getty Images)

Subcontractors, like painters or tile setters, are essential to any renovation. They’ll need plenty of space to work, and you should be especially thoughtful of their needs, especially during inclement or cold weather.

Most tradesmen set up shop outside or in a garage to do “messier” portions of their work, says Jordan Obermann, co-principal and co-founder of FORGE + BOW Dwellings in Fort Collins, CO. “However, during winter it can be very cold, so they’ll need space within the house to set up and run their tools,” he says.

Keep an open line of communication with your subcontractors, and make sure they have all the space they need to get the job done correctly.

6. Taking on certain projects at the wrong time of year

Indoor home renovations are easier to complete in the wintertime because the climate can be controlled. But for outdoor projects like a home addition or new roof, it’s probably best to hold off until the temperature heats up.

You can’t excavate frozen ground or pour concrete if it’s lower than 40 degrees out, points out Matthew Miller, principal and founder at StudioLAB in New York City.

Working on a roof during poor weather can be difficult, too. Roofs are inherently slippery, but recent rain, snowfall, or ice can make roof construction downright dangerous.

“In a nonregulated winter environment, you don’t want to install items that need to be temperature-controlled,” Miller says. This includes projects like installing doors, windows, and flooring.
For this and related articles, please visit Realtor.com
/by

Kitchen Cabinets Need a New Look? 7 Savvy Design Tips To Improve Your Storage Space

Two smart moves when updating your kitchen cabinets include fresh paint and new hardware. But you should also look beyond paint samples or the shape of drawer pulls and think about how you use your kitchen, and whether the organization of your kitchen is doing the best job.

“The best design in any room incorporates how the space is going to be used,” says Karen Gray-Plaisted of Design Solutions KGP.

Case in point, do you still need a drawer dedicated for sippy cups and melamine bowls now that your kids are older—or could that cabinet be better used for something else?

When you are upgrading your kitchen cabinets, don’t be swayed by every trend you spy on Instagram (we’re looking at you, open shelving!). Be brave and create the kitchen that you want to wake up to every morning.

Here are seven design ideas to consider when you’re updating your kitchen cabinets.

1. Try two colors (instead of one)

Photo by Paper Moon Painting

Navy kitchens have been getting all the heart-eye emojis lately, but it can make a kitchen seem dark. Don’t be afraid to use a two-tone color scheme, with a darker hue on the lower cabinets and a contrasting lighter color above, say the pros.

“A deep green or blue paired with a lighter upper is a refreshing look,” says Gray-Plaisted.

2. Open up lower cabinets

Photo by SV Design

Many people flock to open shelving, or they remove their upper cabinet doors to expose their box storage. But revealing the lower cabinets is just as effective and can create an airy feeling in your kitchen.

And if you’ve ever rummaged around in a dark lower cabinet for a Bundt pan or rice cooker, you’ll save time and stress on your back with easy-access bottom cabinets.

Create theme storage by dedicating certain areas to particular needs—think baking dishes and mixing bowls in one section and egg pans and small skillets in another. (This is helpful for open shelving as well as closed cabinets!)

3. Reconsider your storage needs

Photo by Bakken Design Build 

Tastes change over time—and kids grow up and move away. Left in their wake may be storage and other cabinet solutions that don’t make sense anymore.

“Cubbies for wine or certain appliances may not be needed, so consider how you want to live right now and going forward,” says Marty Basher, an organization professional at Modular Closets.

For example, that roll-up, garage door–style cabinet for the standing mixer you’ve stopped using could be replaced with a tricked-out spot for a cappuccino maker. Or the messy dog food bags that live under the sink could finally be stored properly in a pet-feeding station.

4. Skip paint—and add veneer

Photo by Cronos Design 

To rehab kitchen cabinets, think beyond paint. If you have wood cabinets, you might want to sand and stain them a different color. Flat panel doors are a good candidate for new veneer.

“Veneer comes in lots of colors and styles, and it’s actually something you can DIY,” says Basher.

And even if you don’t want to completely cover your cabinets with veneer, you could use it as accent trim, he adds.

5. Pick interesting glass

Ho-hum glass-front cabinets again. Or are they? Look closer, and you’ll notice that these kitchen boxes don’t hew to the same style you see in everyone’s house. Check out the different options for this look, including fluted, wavy, or frosted panels, says Gray-Plaisted.

Bonus: With glass that obscures the insides of your cabinets, you won’t have to work as hard to stack and arrange your cups and bowls every time you empty the dishwasher.

6. Try chicken wire, cork, or chalkboard cabinet faces

Photo by Case Design/Remodeling of Indianapolis

Glass isn’t the only choice when updating your kitchen cabinets. Chicken wire is an unexpected surprise on the fronts as it offers a glimpse of your pretty plates as well as infusing the whole room with a farmhouse vibe.

Or go for cork or chalkboard as inserts on cabinet faces. With handy surfaces like these, you can pin up notices, announce the evening’s dinner menu, or make a to-do list.

7. Consider stand-alone storage

Photo by Davonpor

Sometimes upgrading your kitchen cabinets means adding a separate piece of furniture. A free-standing pantry or larder is an ideal solution for a corner space, whether you buy one just for this purpose or rehab an old china chest or curio cabinet. And if you choose the two-tone theme mentioned previously, you might continue it by painting this item one shade on the outside and a brighter, more exciting hue within.

 

For this and similar articles, please visit Realtor.com

/by

4 Little Ways to Promote Peace of Mind and Positivity During Your Home Search

When you hear of a friend or family member buying a home, it sounds like a very wise thing to do—a savvy investment and a nice step to take in life. However, when roles are reversed and you are the prospective home buyer, you will quickly realize just how emotionally complex the process can be. After all, you aren’t just envisioning a place to rest your head. When you’re buying a home, you’re simultaneously imagining the memories you will make and evaluating how the layout will work for your lifestyle, whether the location is right and so on.

For many, the expense of buying a home is one of the major stressors. Further complicating matters for many house hunters around the country right now are record-low levels of inventory and record-high home prices. It’s worth remembering, though, that those numbers do not tell the full story. Mortgage rates remain low, and customizable homeowner insurance policies can go a long way toward keeping your budget in check.

The fact remains that house hunting is a big undertaking. But when you approach it with some strategies to help you stay positive, you can keep your calm while finding the perfect place.

4 Little Ways to Promote Peace of Mind and Positivity During Your Home Search

When you’re looking for a home, it’s fine (and expected!) if there are some criteria on which you are unwilling to compromise. Maybe your heart is set on a walk-in closet. Maybe you are looking for a fixer-upper to build some sweat equity in the home. Maybe you will only feel comfortable with a home that has a fenced yard for your dog. Starting by getting honest with yourself about non-negotiable factors can help you avoid wasting your energy during the search.

On the other side of the coin, you should also think about ways in which you would consider expanding your hunt:

  • Would you be willing to look at homes in neighboring communities?
  • Could you do with less square footage if there is more outdoor living space?
  • Do you need a finished basement now or is that something you could tackle in the future?

As needs change with the rise of remote work and kids going back to school, revisiting some items that were initially on your “nice to have” list could help open up a much larger selection of homes and price points.

Avoid financial guesswork

Buying a home is a process that involves both your heart and your head—and it can be heartbreaking to learn you fell in love with a home that’s outside of your budget comfort zone. Although mortgage rates and competitive sale prices can feel like moving targets, you can get a feel for the price of your homeowner insurance with online tools and quotes. Because homeowner insurance is necessary for anyone who is taking out a mortgage (and a good idea for anyone who owns a home), it is an important factor to consider during the house selection.

By also having an understanding of how different variables can affect a home’s insurance price, you may be able to narrow your search field. For example, a home on a low-lying side of a neighborhood may be more expensive to insure than one that is similarly priced just a few streets over. Or you may learn that a home with a new roof can help you save. When you keep factors like these in mind, you can be a more informed, empowered home buyer.

Work with experts you trust

In general, people will only buy or sell a home a few times throughout their lives. So, naturally, there are some questions that you may not even know to ask. That’s where it pays to put in a little work ahead of time to assemble a trusted, experienced team of experts who can help guide you through the process. Not only can this position you to find the right house, but it also can help you get it for the right price.

If you are just dipping your toes into the house search, start by getting referrals or reading reviews for real estate agents, mortgage lenders, and insurance companies. The truth is that reputation matters—so feeling like you’re well taken care of with a person or company is always the best call.

Don’t put pressure on your timeline

There are instances when a move has to happen on a specific timeline. However, if you’re in a position to be a little more flexible, you can set yourself up for a more peaceful experience. Historically, there are times of the year when inventory is low in the housing market. The flip side is that there may be more competition among other house hunters during higher inventory times. By giving yourself several months to see what is listed, you may be able to enter the market at just the right time.

When you’re immersed in the house search, it can feel like you constantly need to be on call and ready to act—and that doesn’t exactly lend itself to a calm, enjoyable experience. Just like you need occasional breaks from work, also be willing to take a step back from the search if it begins to feel like too much. If a house comes and goes during that time, it simply wasn’t meant to be.

Finally, when you’re looking for a house, know there is light at the end of the tunnel. Although you may not be able to picture the exact style of the home you’ll end up in or what the yard looks like, you should be able to channel the sense of peace that you will feel when you unlock that front door for the very first time.

Read the full article and more at Realtor.com

/by

Are Property Taxes Lower for Condos or Townhouses?

Are property taxes lower for condos? What about townhouses? If you’re buying your first home, you might wonder how the type of home you buy may affect your taxes and whether buying a condo or a townhouse makes a difference. It seems plausible that a smaller home might come with a smaller tax bill, right? But your property’s square footage is just one factor that goes into determining how much property tax you owe. Let’s look at what goes into that number and if it is, in fact, lower for smaller properties.

Are Property Taxes Lower for Condos or Townhouses?

Difference between a townhouse and a condo

It helps to understand that the distinction between a townhouse and a condo comes down to how the property is sold to you. The general rule of thumb: If you purchase a condo, you own just the inside of the building. If you purchase a townhouse, you might own the property outside as well per the bylaws of your homeowners association.

“A townhouse has land under it that you own, and a condo does not,” says Joyce Mitchell, a real estate agent with Mitchell & Associates Real Estate in Bigfork, MT.

When you buy a condo you co-own communal property beyond your living space. So will this distinction make a difference in your tax bill? Sort of.

What affects property taxes

There are two main factors that go into the amount you have to pay each year in property taxes. The first is your home’s assessed value that’s determined by an assessor who looks at things like the acreage, square footage, number of bedrooms and bathrooms, and comparable homes nearby. The other factor is the mill levy, or tax rate for your area, usually expressed as a percentage. Mill levy is based on the quality of the public amenities offered such as your town’s public schools, police force, and number of parks. The more amenities, the higher your mill levy will be.

Taxes for single-family homes, condos, and townhouses are calculated the same way, says Larry Friedman, co-founder and principal of SDF Capital, a real estate investment company based in New York’s Westchester County. “It’s based on assessed value and then multiplied by mill rate to determine tax amount.”

Property taxes: Lower for condos or townhouses?

Because of a number of factors, including square footage and number of bedrooms, you can typically expect to pay lower property taxes on townhouses and condos than on single-family homes.

“A condo or townhouse has less space per taxpayer than a single-family home,” says Richard M. Prinzi Jr., CPA and co-founder of F-Sharp Tax Management Services. “In a condo living situation, many taxpayers will share in the tax due for the land and the common areas” such as hallways, lobby, and stairs, he says.

The owner of a townhouse is usually solely responsible for paying taxes on the home and the land it’s built on, but that square footage, on average, is far less than the typical single-family home. Therefore, the taxes for a condo or townhouse are usually lower.

Taxes vary based on where you live

That said, different states and communities have their own real estate tax rules. For example, in California, Proposition 13 mandates that Mello Roos Bonds (which pay for community infrastructure) cannot be based on a home’s value, says Greenside Properties broker Patrick Morgan. Instead, these rules are usually based on a unit’s square footage, usage, and lot size. You can check with your city’s department of finance to get your local tax information.

HOA fees and other added costs

Of course, living in a townhouse or condo can come with HOA fees, which can offset those savings on property tax.

According to Mary Jo Fiore-Posterli, a Realtor® with Coldwell Banker in Lake Forest, IL, condos and townhouses can come with HOA or condo association fees. These associations are elected boards that manage amenities and maintain standards for your complex.

“Depending on the townhome or condo community, you may have an association that has a pool and a tennis court, and someone has to pay for the upkeep of that,” Fiore-Posterli says. As the property owner, you would pay a monthly fee through the association. HOA fees are typically higher for condos than for townhouses.

Of course, your fees will be lower if you don’t have a pool or other similar amenities. Some communities even have you pay for your heat through the HOA fees.

No matter where you decide to live, make sure you do the math and consider HOA fees and the like before deciding if purchasing a smaller property really will translate into lower monthly or annual costs for you.

 

For this and related articles, please visit Realtor.com

/by

Decided Not To Sell? 5 Inexpensive Ways To Make Your Bathroom the Oasis of Your Dreams

Would-be home sellers have been facing quite a conundrum for the past few months. Sky-high mortgage rates and inflation have kept homebuyers from coming in droves like they did last year, and that, in turn, has caused homeowners to consider one crucial question: Should I list now or wait until the real estate market cools?

If you’re choosing to sit tight and refocuse your efforts on home improvement, we suggest you invest your time and money in your bathroom. Like the kitchen, the bathroom holds a lot of value, and updating it is likely to pay off if and when you do put your home on the market.

“After hitting the one-year mark in your home, the first places that I’d update are bathrooms, especially a powder or guest bathroom used often by visitors,” says Jay Jeffers of JayJeffers in San Francisco.

Your bathroom can be easily and affordably improved without the need for a gut renovation. Here are a few smart ideas.

1. Upgrade the faucet

Is your sink faucet looking a little dated? Replacing it doesn’t have to be expensive.

“For budget-minded DIYers, upgrading bathroom faucets is an easy weekend project that can instantly elevate the look of the space,” says Laurie March of Laurie March Home in Los Angeles.

If your aesthetic skews modern traditional, March recommends the new Bellera single-handle bathroom sink faucet from Kohler, which she describes as timeless and affordable.

For a faucet with a little more style and versatility, March recommends Kohler’s new Riff faucet.

We also like this reasonably priced faucet option from Moen.

2. Install a new countertop

Nothing opens up a bathroom like brand-new countertops.

“New countertops always fall in my ‘worth the investment’ category,” says Young Huh, an interior designer in New York City. “New surfacing can completely transform the space—especially when you carry the material up the wall as a counter splash. It adds instant luxury and drama.”

For a moody look in your bathroom, he recommends going with a slab of Eternal Marquina from Silestone. If light and bright is more of your vibe, Silestone’s Ethereal Glow is the countertop for you.

Huh says both stones are zero-maintenance and have the appropriate durability for a primary bathroom.

3. Up your storage game

No one likes a messy, unorganized bathroom. If you’ve been feeling the clutter crunch, it’s time to dedicate an afternoon to upping your storage game.

There’s no need to reconstruct your bathroom. All you need to do is stock up on some organizational products, clean out the toiletries you no longer use, and put it all back in a tidy fashion.

“To gain more access to your toiletries, you can easily add a tip-out tray or a pull-out shelf under the sink,” says Steve O’Hara, director of product development and training at ShelfGenie.

Some of the most useful products that will keep your bathroom organized are under-sink shelves, turntable organizers, an over-the-shower caddy, and apothecary jars.

“Beauty and hair styling tools like hair dryers and curling irons can be stored in a hair dryer caddy under the cabinet to help maximize space on your countertop,” says O’Hara. “This helps ensure your bathroom is an uncluttered, functional space.”

4. Modernize your mirrors

Some bathroom mirrors look like an afterthought and lack any sort of style.

“An easy way to transform a bathroom from sterile to chic is by swapping in an artful mirror,” says Jeffers.

We love the geometric look of the Torino mirror from Jeffers’ collection with Arteriors.

In search of something simpler? Try this rectangular metal mirror that’s available in a variety of colors.

5. Make a statement with wallpaper

One of our favorite ways to add visual interest to any room of the home—the bathroom included—is to install wallpaper.

Tamara Day, designer and host of Magnolia Network’s “Bargain Mansions,” says peel-and-stick wallpaper in the bathroom is one of the quickest and most affordable ways to revamp your space.

“When working with a bathroom specifically, it’s important to use products that can handle moisture,” says Day.

She recommends RoomMates Decor’s peel-and-stick wallpapers since they are durable and provide a barrier to humidity.

“This makes them perfect for the bathroom. You don’t have to sacrifice great design for performance and functionality,” says Day.

Grab this tropical-themed wallpaper from Day’s collection with RoomMates and apply it to one wall of your bathroom to create a statement feature.

 

For this and similar articles, please visit Realtor.com

/by

For Portland Homeowners and Interior Designers, Wallpaper Is Back

Cool new choices and YouTube tutorials help resurrect the midcentury trend.

Local interior designer Mandy Riggar chose this paper from Portland-based collective Makelike for a client’s stairway.

IMAGE: CHRISTOPHER DIBBLE

Remember the glory days of patterned wallpaper? We’re thinking 1950s floor-to-ceiling patterns, more-is-more florals, and geometric shapes on every vertical surface. That was before the backlash—for decades, nobody would be seen dead with anything but a flat painted wall as a backdrop, and all the world was smooth.

Well, wallpaper is back, baby, but not like before. From Spoonflower’s peel-and-stick to Flavor Paper’s scratch-and-sniff, lemon-lime-scented iteration, there are countless new and delightful ways to dress up your surfaces.

Mandy Riggar, a Portland interior designer, says the wallpaper renaissance is due in part to a rise in affordable and accessible versions, like self-adhesive wallcoverings that are easy to install and remove. Plus, there are now a zillion styles from which to choose, not to mention custom designs, which make wallpaper “almost trendless,” says Riggar. “It’s just about finding the brands that carry the style you like.”

For one client’s stairway (pictured above), Riggar sourced the wallpaper from Makelike, a Portland-based graphic design collective founded in 2000 by Mary Kysar and Topher Sinkinson, which produces a selection of hand-screen-printed wallpaper featuring botanical, coral, geometric, and abstract patterns in myriad color palettes.

Portraits by Portland-based artist Gracie Ellison paired with a printed design chosen by local interior designer Vicki Simon in a client’s powder room

IMAGE: CHRISTOPHER DIBBLE

Another Portland interior designer, Vicki Simon, used printed wallpaper with a sketch-like pattern in black and white in a client’s powder room, and found it paired well with hanging portraits by Portland-based artist Gracie Ellison. “For me, using wallpaper is just a fantastic way to integrate, to bring interest to a project, especially in smaller spaces,” Simon says.

For similarly bold designs, with some peel-and-stick options for a low barrier to entry, local wallpaper studio Thatcher (formerly Juju Papers and Avery Thatcher Tile) produces a wide range of products for residential and commercial spaces, with bold motifs and one-of-a-kind styles.

Since it was founded in 2012 by Avery Thatcher, the studio has found a nationwide client base, which Thatcher says grew with the resurgence of DIY home décor during the pandemic.

If you’re looking to install wallpaper on your own, YouTube is a good place for step-by-step instructions. It’s a tool Thatcher says has revolutionized the use of wallpaper and fed its growing popularity. “The first time I installed [wallpaper], I definitely watched a YouTube video,” she says.

A wallpaper from Thatcher Studio

IMAGE: LEAH VERNY

Thatcher still encourages people to purchase traditional wallpaper and hire professional installers if they can afford it, but she offers another pro tip for folks who want to go it alone: use liner paper, a heavy-duty paper that smooths out any imperfections. “It makes traditional wallpaper totally removable, and all of it is curbside recyclable at that point,” Thatcher says. “It has a special paste that allows it to be removed, and then you put the wallpaper on top of it.”

 

For this and related articles, please visit Portland Monthly

/by

What Is a Saltbox House? A Colonial Style That Modern Buyers Love

Named for the shape of the container used to hold salt in colonial times, these homes have a steeply sloped roof that is much longer on one side than the other.

Saltbox houses are common in New England, and back in the 18th century, housed many famous pioneers and patriots, including the second U.S. president, John Adams. Sturdy and understated, they are found by the bushel in historic registers and are very popular today. Read on for a brief history of this quaint architectural style, and why it has such enduring appeal.

Historic Saltbox

A brief history of saltbox houses

Back in colonial times, many saltbox homes started as symmetrical two-story houses, but as families expanded, so did their square footage. One-story additions were built on one side of the home, pulling the original roofline farther down and giving these homes their distinctive asymmetrical shape.

As Lance Abbott Kirley of residential design firm Classic Colonial Homes in Massachusetts notes, “So many aspects of colonial architecture are about symmetry, yet when viewed from the side, the saltbox—with its long rear sloping roofline—challenges that notion.” It’s that distinctive look, Kirley says, that “makes saltbox homes appear more grounded and resilient than all other styles of New England homes of the period.”

Another advantage was that snow could slide down the extended rear roofline, preventing any given part of the roof from carrying too heavy a load. Gavin Townsend, art history professor at University of Tennessee at Chattanooga, adds that feline lovers will be amused (or not) to learn the roof’s nickname: a “cat slide.”

“Because an adventurous feline, finding herself on an icy roof, could slide down the outshot [extended roof] and reach the ground, while suffering damage only to her dignity,” he says.

Saltbox homes also boast plenty of storage space—typically in the cramped triangle of dead space under the extended roof, just above the ground-floor addition. This also provided an additional barrier from the cold, which was appreciated in the days before fiberglass insulation and central heating.

These homes also sport traditional colonial features like narrow clapboard siding, tight-patterned window grilles, a massive center chimney, and understated exterior trim. However, saltbox homes have since evolved to suit a variety of needs and tastes, thanks to their unique blend of practicality and whimsy. Many older saltbox homes have been reworked by design firms to preserve the traditional exterior, but include more contemporary interiors and modern features.

But no matter how they’re modified, saltbox homes remain fashionable because they are classic and practical. Kirley notes that his company’s clients ask for saltbox homes more than any other Colonial style. After all, the saltbox has served American families for over 300 years—why not several hundred more?

What Is a Saltbox House? A Colonial Style That Modern Buyers Love

 

For this and related articles, please visit Realtor.com

/by

Put the ‘Pow’ in Your Powder Room With These 5 Budget-Savvy Décor Ideas

Glamming up a guest bathroom is often a lower priority than, say, modernizing your kitchen or replacing your roof. But as the holidays approach—and your regular guests come a-calling—you might be looking for ways to spruce up your spare loo on the cheap.

This week we gathered five trendy decor looks from Instagram—with affordable ways to get these looks—that are sure to inspire your guest bath overhaul. No matter how small or large of a project you’re looking to take on, the following ideas offer something for everyone.

It’s time to put the “pow” back into your powder room—without spending a ton of money. Here’s how.

1. Sectional mirrors

A common decorating trick is to add a mirror to a space to jazz it up, and these sectional mirrors from @bathroom_decor take the concept in a charming and unexpected direction.

“Geometric mirrors can create a focal point in a small space,” says interior designer Amanda Oninski, of FLOOR360. “It’s a bold design choice that creates a look that’s both glam and luxe. Coordinating those shapes with the tile, accents, and wallpaper in the space will make it feel complete.”

Get the look: Arrange a few of these diamond-shaped wall mirrors in your guest bath.

2. Smoky glass pendants

Another quick way to upgrade your stale bathroom is with new light fixtures. We’re in love with these chic smoky glass pendants from @maxis.homestory.

“A glass pendant light is a classic fixture,” says Oninski. “Using the smoked-glass pendants modernizes the look of the fixture and the space it’s in. This fits squarely with the design trend of creating spaces that strive to blend traditional with modern.”

Get the look: Shop this smoky glass pendant for a timeless look in your bathroom.

3. Penny tile

If you’re all in for a big design overhaul, consider redoing your bathroom walls or floor in a penny tile like this one featured by @chairishco.

“Penny tiles have been increasing in popularity in recent years because they are a cost-effective way to add some personality and a touch of vintage to a bathroom,” says interior designer Carla Bast. “The small size gives you an opportunity to get creative with patterns and create a custom look. Their small size also makes them less slippery than larger tiles.”

Get the look: Find the perfect penny tile for your bathroom by shopping this collection at Home Depot.

4. Block-print wallpaper

Calling all grandmillennials! Another way to go all out in your guest bathroom is with brand-new wallpaper like this trending block-print pattern from @mindygayerdesign.

“I love block-print wallpaper in the bathroom because it’s classic and timeless,” says Bast. “It’s not too busy or overwhelming, and has just the right amount of detail, without distracting from other features in the bathroom. Try pairing it with a bright-colored vanity for an unexpected twist or wood-toned cabinetry for a more subtle look.”

Get the look: Check out this block-print wallpaper from McGee & Co.

Looking to upgrade your wall space without changing the walls themselves? Why not install a gallery wall like this one from @the_interior_lens.

“There’s something about having a gallery wall next to your tub that adds a cozy, lived-in feel to the bathroom,” says Bast. “It feels like a natural extension of the living room into the bathroom.”

Even if your guest bathroom doesn’t have a tub, you can still add a personal touch to the space with an eclectic wall of art you’ve collected over the years.

Get the look: Shop local vintage stores for one-of-a-kind art, or download some ready-made prints on Etsy.

 

For this and similar articles, please visit Realtor.com

/by