Yajnesh Rai

California homeowners lead the U.S. in being home equity rich | The Sacramento Bee

Boosted by soaring home prices, California homeowners are now sitting on the richest vein of home equity in the nation, hundreds of thousands of dollars per home in most cases, an analysis shows.

More than 43 percent of Golden State homeowners with mortgages qualify as “equity rich,” meaning those owners’ homes are now worth at least twice their mortgage balance. And fewer than 4 percent are now deeply underwater on their mortgages, far lower than the national 10 percent average.

The message is twofold: California real estate has pulled well beyond the carnage of the 2007 to 2011 housing collapse. And it has done it in a big way compared to the rest of the United States, to the point of being slightly worrisome, some real estate watchers say.

“That’s is great news for homeowners who are becoming equity rich, but it is a sign of that excess we tend to see in the California market,” said Daren Blomquist, a vice president with Attom Data Solutions, an Irvine-based real estate data company that compiled the mortgage data.

Attom defines equity rich as those whose home is worth twice what they owe on their mortgage. A homeowner with a $200,000 mortgage is equity rich if the home value is $400,000 or more. Conversely, a homeowner is considered seriously underwater if his or her mortgage is 25 percent higher than the home value, such as a home that is worth $100,000, but carries a $125,000 mortgage.

 

 

In the Sacramento region, 34 percent of homeowners have hit the “equity rich” mark, not as many as in the state’s booming coastal economies, but easily above national averages. The region’s seriously underwater number is slightly more than 4 percent.

Attom collects the mortgage data from most homes to track the ripple effect of the mass housing recession that hit the nation a decade ago. The company does not collect data from ZIP codes with fewer than 2,500 homes with mortgages. It also does not include homes without a mortgage.

The data show the nation as a whole is recovering from the housing collapse, but the results are uneven.

 

 

“The share of seriously underwater properties has dropped well below 10 percent in bellwether housing markets such as California, Washington, Texas, Colorado and New York, but the underwater rate remains stubbornly high in markets where price appreciation has not been as strong during the housing recovery of the last six years,” Blomquist said.

Mid-sized “rust belt” cities that lack jobs or growing populations have the highest underwater numbers, he said.

In some areas of California, the “equity rich” numbers dwarf the national average of 24 percent. Most of the wealthiest are in the Bay Area, including 72 percent in San Jose, the heart of Silicon Valley, and 61 percent in San Francisco.

 

 

The best-off homeowners in the Sacramento region are in the city of Davis, where 57 percent are equity rich, followed by South Lake Tahoe, at 42 percent, according to Attom data.

Should Listing Photos Be Removed After the Sale? | Realtor Magazine

Some home buyers express concern that photos of their properties continue to live on real estate websites after they’ve closed on the purchase, and they’re asking real estate professionals to help take them down, citing privacy and security issues. In a column in Chicago’s Pioneer Press, a buyer named “Deborah” wrote about her efforts to get the listing photos of her home removed after she bought it. Deborah says the seller’s agent refused her immediate request, saying other real estate companies like to see the photos and use them as comparables and for appraisals.
 

 

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But Deborah was concerned that the interior of her home was still viewable. In the column, she calls for the industry to launch a new provision for home buyers so that they can opt out of keeping listing photos online indefinitely—similar to a “Do Not Call” list.

Generally, secondary photos of sold properties can be “suppressed” from an MLS’s data feed to third parties at the listing agent or managing broker’s request. However, the primary listing photo—which most often is an exterior shot of the property—likely will remain available to view.

Lesley Muchow, deputy general counsel for the National Association of REALTORS®, says homeowners can request that third-party sites remove property photos that are still visible after closing. Homeowners also may want to ask their agent to intervene in getting photos suppressed from the MLS and its feeds.

Redfin: Bidding Wars Fuel Surge in Home Prices | Realtor Magazine

Home buyers are bidding up prices in some markets where inventories remain tight, particularly out West, according to a new report by real estate brokerage Redfin. Redfin found that California has four out of the top six cities with the hottest housing competition, while New Orleans has the least competitive market nationwide. The outbreak of bidding wars is what’s causing a home price surge in some markets, the brokerage says. 

 

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“For buyers, competition is challenging,” Rachel Musiker, Redfin spokeswoman, told CNBC. “To win, they will likely have to raise their offer price and waive contingencies, and it might take several months and several bidding wars before they find success.”

Places within commuting distance from busy hubs—such as Silicon Valley—are experiencing an increase in workers looking for affordable homes. Most selling homeowners receive multiple offers, which move within a week or less of going on sale, Musiker said to CNBC. Redfin evaluated which markets, with populations of at least 200,000, are seeing some of the most competition lately.

In the following markets, the majority of homes are being sold with multiple offers and sometimes with waived contingencies too:

• Fremont, Calif.
• San Jose, Calif.
• Seattle
• Oakland, Calif.
• Aurora, Colo.
• San Francisco

Water Heater Life Expectancy & Troubleshooting Tips | Home Matters | AHS

The average electric hot water heater can last between 8 to 12 years. Here are 6 signs to help extend your water heaters life expectancy.

Whether washing a load of clothes or taking a quick shower, we’re used to having plenty of hot water ready whenever we need it. You can expect the average electric hot water heater to last between 8 to 12 years.

Whether you have gas or electric, sometimes things can go wrong and that once overlooked modern luxury can suddenly become a major headache. The following early warning signs will help you identify if your hot water heater is in need of repair or replacement.   

6 Signs to Replace a Water Heater

Rusty Water

Your hot water heater is susceptible to corrosion. It’s true, that steel tank can and will eventually give way to rust. If you’re seeing rusty water, your hot water heater is sending you a clear sign that leaks could be on their way. Be aware – rusty water could also be a sign of corroded pipes. Either way, rusty water is a precursor to bigger problems and should be addressed immediately.

 

No Hot Water

While finding yourself in the middle of an ice-cold shower can be quite a wake-up call, there are other possibilities. First of all, your pilot light could be out. Second, your circuit breaker could be tripped. If both of those are fine, your heater could be at the end of its lifecycle.

Warm Water

Warm water is nice, but you didn’t buy a Warm Water Heater. If your water temperature is taking a dive, your heating element could be in danger of going out. Make sure your thermostat temperature is between 120 to 140 degrees, anything lower could provide warm, but not hot, water.

 

Noise

Banging, clanging, thumping – any loud, unexpected noise is a bad sign. As your hot water heater ages, you might hear slight noises as your hot water heater warms up, but pronounced sounds could be indicators of larger issues such as sediment build up in the bottom of the tank. As sediment builds up it can wear your heater down, causing inefficiency and accelerated wear and tear.

 

Leaks

As time moves on and your hot water heater reaches the end of its lifecycle, the odds are you’ll be looking at a leak. Or leaks. After thousands of heating cycles, the inner-body of the tank will succumb and begin to expand. While the initial cracks and fissures may be small, they will widen with each ensuing cycle, resulting in costly leaks.

If you do find yourself in a situation where a new hot water heater is needed, take a moment to review your options. Maybe this is a chance to upgrade to a new tankless heater?  This is also a good opportunity to review your water heater warranty coverage. When you invest in an American Home Shield you will ll enjoy robust coverage for your water heater. Many parts and components of your water heater are covered. By staying informed and aware of water heater issues, you can avoid nasty leaks and cringe-inducing cold showers. 

Mortgage Rates Ease for Second Consecutive Week | Realtor Magazine

Borrowers had slightly more relief with mortgage rates again this week. The 30-year fixed-rate mortgage rate dipped again, averaging 4.53 percent, Freddie Mac reports.

“The stability in borrowing costs comes despite the highest core inflation rates since 2008 and turbulence in the currency markets,” says Sam Khater, Freddie Mac’s chief economist. “Unfortunately, this pause in rates is not leading to increasing home sales.”

Last week, mortgage applications for home purchases once again trailed levels from last year. “It’s clear that in some markets the combination of ascending home prices, limited affordable inventory, and this year’s higher rates are curtailing home buyer demand,” Khater says.
Freddie Mac reports the following national averages with mortgage rates for the week ending Aug. 16:

• 30-year fixed-rate mortgages: averaged 4.53 percent, with an average 0.5 point, falling from last week’s 4.59 percent average. Last year at this time, 30-year rates averaged 3.89 percent.
• 15-year fixed-rate mortgages: averaged 4.01 percent, with an average 0.5 point, dropping from last week’s 4.05 percent average. A year ago, 15-year rates averaged 3.16 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 3.87 percent, with an average 0.4 point, down from last week’s 3.90 percent average. A year ago, 5-year ARMs averaged 3.16 percent.

  

   

Millions of Consumers Getting a Credit Score Boost | Realtor Magazine

An overhaul in how several major credit reporting agencies factor in negative credit information is prompting millions of consumers’ credit scores to rise. Collection events were struck from 8 million consumers’ credit reports in the 12 months ending in June. The New York Federal Reserve reported Tuesday that consumers who had at least one collections account removed from their credit reports are seeing an 11-point increase to their scores. 
 

 

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Critics have long claimed such dings to scores are prone to errors or that they’ve unfairly kept many out of the borrowing market. Equifax, Experian PLC, and TransUnion have all agreed to revamp reports, which stems from a 2015 settlement with state attorneys general on the matter. In the settlement, the firms agreed to remove some non-loan related items that were sent to collection firms, such as gym memberships, library fines, and traffic tickets. They also agreed to strike medical-debt collections that have been paid by a patient’s insurance company.

The majority of consumers who benefited from the recent changes are those who had credit scores below 660 before the collection events were removed, according to the New York Fed.

This could be good news for potential home buyers, as better credit scores are a big factor lenders use in granting cheaper rates for mortgages. And relatively small shifts in scores can make a big difference on loan affordability. A recent study from LendingTree showed that consumers who can raise their credit scores from “fair” (580-669) to “very good” (740-799) could potentially save $29,106 in mortgage costs.

Survey: 5M Renters Have Fallen Prey to Online Scams | Realtor Magazine

More than 43 percent of renters say they’ve found online rental listings that seemed fraudulent, and more than 5 million say they’ve actually been scammed—sometimes to the tune of thousands of dollars—according to a new report released by rental website ApartmentList.com.

 

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Renters may be less diligent in researching apartments when feeling the urgency to move, says Igor Popov, chief economist at Apartment List. “There are lots of cases where there’s a lot of urgency in the rental market, especially in some of the really supply-concerned markets that are out there, where you have 10 renters fighting for one available apartment,” Popov told CNBC. “In reality, there’s a lot of urgency, and I think scammers can also sometimes prey on this.”

The survey revealed that the most common scam is a “bait-and-switch” one, where a different property is advertised than the one that is actually available. The scammer is often able to collect a deposit or get a lease signed for the fake property. Another common scam is the “hijacked ad,” where a scammer takes a home that is legitimately for sale and poses as a fake landlord to collect funds. Apartment List also warns of a growing scam in which a listing property that is already leased is posted online. The scammer then attempts to collect application fees or security deposits from an unsuspecting consumer.

“I think what really surprised us was just the prevalence of the different variety of scams out there,” Popov says. “It is surprising how many people have fallen for these types of scams. Over 5.2 million renters out there have either put down an application fee, or a security deposit, or maybe even first month’s rent, usually sight unseen.”

Median Age of Maturing U.S. Housing Stock is 37 | Realtor Magazine

The median age of owner-occupied homes in the U.S. is 37, indicating that more properties may become pricier to maintain as they grow older and vulnerable to disrepair, according to the 2016 American Community Survey.

 

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But builders view the aging housing stock as an opportunity. Rising home prices may prompt more households to spend more on home improvement, the National Association of Home Builders notes on its Eye on Housing blog. Further, “this indicates a strong rising demand for new construction over the long run, as current owner-occupied housing stock is older,” the NAHB writes.

More than half of the owner-occupied homes were built prior to 1980, and 38 percent before 1970. Sixteen percent of the housing stock was built between 2000 and 2009. The 3 million units that came to the market between 2010 and 2016, however, added only 4 percent to the owner-occupied housing stock.

A decline in new construction has prompted the share of homes that are six or fewer years old to fall greatly since 2006, according to the NAHB. Meanwhile, the number of homes that are 46 years old or older has jumped from 31 percent in 2006 to 38 percent in 2016.

Home Inspection Tips, Cost and Benefits of a Pre-Listing Home Inspection

Getting beyond the home inspection is sort of like advancing to the next level in a video game.

When you get past this step, you get to advance to a fresh, exciting place — your new home, to be exact.

In Every Inspection, There Are Stakes for Buyers and Sellers

Once the buyer has made, and you’ve accepted, the offer, your home will get the once-over from the buyer’s home inspector. The inspection is usually a contingency of the offer, meaning the buyer can back out based on serious problems discovered. The lender also expects an inspection to make sure it’s making a good investment. Makes sense, right? 

During the home inspection, an inspector will examine the property for flaws. Based on the inspector’s report the buyer will then give you a list of repair requests. 

Your agent will work with you to negotiate those requests. Don’t want to be responsible for a repair? (Maybe it’s best if the buyer has the fix made by their own contractor anyway.) Your agent may be able to negotiate a price credit with the buyer instead. 

By the way, inspections aren’t necessarily a big, scary deal. Your agent will help advise you about repairs you need to make before the inspection. In fact, she may have made those recommendations to you even before you put the home on the market. And if you’ve been maintaining your home all along (and you have, right?), your punch list may be minimal.

In addition, back when you put the home on the market, you were required to disclose to buyers the home’s “material defects” — anything you know about the home that can either have a significant impact on the market value of the property or impair the safety of the house for occupants. Material defects tend to be big underlying problems, like foundation cracks, roof leaks, basement flooding, or termite infestation.

What a Home Inspection Covers Depends on the Home

Every home is different, so which items are checked during your property’s inspection may vary. But home inspectors typically look at the following areas during a basic inspection:

• Plumbing systems
• Electrical systems
• Kitchen appliances
• Heating, ventilating, and air conditioning (HVAC) equipment
• Doors and windows
• Attic insulation
• Foundation and basement
• Exterior (e.g., siding, paint, outdoor light fixtures)
• Grounds

Depending on the sales contract, the purchase may also be contingent on a roof inspection, radon inspection, or termite inspection.

What a home inspection won’t cover is the unseen. Your inspector isn’t going to rip open walls or mountaineer on the roof. (Though that would be kind of exciting to watch.)

 

So What Do You Need to Fix?

A home inspection report is by no means a to-do list of things that you must address. Many home repairs, including cosmetic issues and normal wear and tear, are negotiable. 

There are, however, three occasionally overlapping types of repairs that sellers are typically required to deal with after a home inspection:

1. Structural defects. This is any physical damage to the load-bearing elements of a home; these issues include a crack in the foundation, roof framing damage, and decaying floor boards.
2. Safety issues. Homes for sale have to meet certain safety standards. Depending on where you live, safety issues that you, the seller, may have to address could include mold problems, wildlife infestation, or exposed electrical wiring.
3. Building code violations. Building code violations — such as the absence of smoke detectors, use of non-flame retardant roofing material, and use of lead paint after 1978 — must be addressed by the seller.

Again, addressing these might take the form of a credit on the pirce, which in the case of structural issues could be sizeable. 

Use This Checklist to Prepare for a Home Inspection

So, are you ready for the inspection? If you take these steps (with your agent’s assistance) you will be: 

• Assemble your paperwork. Transparency is key. Ideally, you’ll have summaries or invoices of renovations, maintenance, and repairs you’ve done on your home that you can provide to the home buyer. Create a file that collects this documentation and share it with the buyer.
• Make sure your home is squeaky clean. Your home should be pristine when the inspector arrives — a good first impression will set a positive tone. Take time to declutter and deep clean the whole house. A deep clean (stuff like cleaning the range hood and upholstery and sanitizing garbage cans), averages between $200 and $400, according to Angie’s List, depending on the size and condition of your home. 
• Remove any obstacles that may block  Does the Inspector Have a View?Make sure to rake up leaves and brush from the home’s foundation so the inspector can get a good view of the grounds, grading, and exterior. the inspector’s access. Take measures to ensure the inspector has complete access to all facets of the property, including electrical panels, attic space, and fireplaces. This may require temporarily moving clothing and other items that impede access.
• Leave the utilities on. For the home inspector to test items such as the stove, dishwasher, furnace, and air conditioning system, the utilities must be connected regardless of whether the house is vacant; otherwise, the inspector may need to reschedule, which can potentially push back closing. 
• Fix minor problems ahead of time. Many cosmetic issues — say, a broken light fixture or a scratch on the wall — are minor and easy to fix, but they can make buyers more concerned about how well you’ve maintained other areas of the home. It’s best to take care of small problems yourself before the buyer’s inspection.

It’s a Good Idea to Do Your Own Inspection Before the Inspection

Some sellers choose to hire their own home inspector to check the property before their house is even listed. This is called a “pre-listing inspection,” and it has several advantages:

• It can give you time to fix deal breakers. Granted, a pre-inspection costs money — a basic inspection is about $315, with condos and homes under 1,000 sq ft. costing as little as $200 and homes over 2,000 sq ft. running $400 or more, according to HomeAdvisor.com. That said, it can enable you to address major issues that could cause a buyer to pull out of their offer. Big problems may include mold, water damage, or foundation cracks. 
• It can mean fewer surprises — and help you market your home. Knowing what needs to be fixed in your home in advance will enable you to be upfront with buyers about any big pre-existing issues, which can give buyers peace of mind. You can also make it known to prospective buyers that consideration for those items has already been factored into the sales price.
• It can speed up the negotiation process. Having a pre-listing inspection can help reduce, or even eliminate the time-consuming process of having back-and-forth negotiations.

If you discover any material defects to the property in a pre-listing inspection, you are legally required to disclose them to buyers — even if you fix them. Also there’s no guarantee that the buyer’s own inspection won’t reveal things yours didn’t find. The choice to do a pre-listing inspection is yours, but it never hurts to get a head start on repairs.

Be Aware of These Tried-and-True Tactics for Negotiating Repairs

When it comes to repairs, your agent will haggle with the buyer’s agent for you — though it’s ultimately your decision as to how you want to respond to the buyer’s home repair requests.

Here are four time-tested negotiating techniques that your agent may deploy to protect your best interests — without reducing the sales price:

1. Agree to make reasonable repairs. Unless your house is flawless — and the reality is that no one’s is — be prepared to receive repair requests from the buyer. You don’t have to offer to fix everything that buyer asks of you, but you should take responsibility for major issues.
2. Offer a closing cost credit. Don’t want to deal with the hassle of making or ordering home repairs yourself? Ask your agent to offer the buyer a credit at closing for the estimated costs. This can also help you avoid complaints from the buyer over the quality of the workmanship, since you won’t be the one overseeing the repairs.
3. Barter. One way to smooth things over with a buyer and keep the deal moving forward is to offer something of value that’s unrelated to the requested repairs. For example, if you know the buyer loves the new couch or bedroom set you bought, you could offer to leave it behind in exchange for making fewer repairs.
4. Leverage the market. You may have more negotiating power depending on where you live. In a hot seller’s market, for instance, you might be in the position to offer the buyer fewer repairs, especially if you have another buyer eager to make an offer. 

Home inspection may sound like a burdensome process, especially when you’re so close to your goal. But when you cross it off your list, you’re readier than ever to jump to the next level — and into your life’s newest phase.

Kitchen Countertops | Countertops Cost | Kitchen Counters

Want a hardworking countertop that fits your budget? We took a look at six of the most-durable kitchen countertops based on a recent “Consumer Reports” test.

After a thorough exam, we’re ready to let you in on why you should — or shouldn’t — install them in your kitchen.

#1 Quartz Kitchen Countertop ($40 to $100 per square foot)

The durability winner is quartz, the man-nature combo countertop. Crushed quartz stone is mixed with resin to produce countertops that range from solid colors to the look of real granite, but they’ll beat natural stone in toughness.

Pros

Quartz is almost indestructible under normal kitchen prep conditions. It laughs at knife cuts, and, unless you take a sledgehammer to it, it won’t chip or crack. It’s stain- and bacteria-resistant, and it doesn’t require sealing.

Cons

You pay a lot for quartz, and it’s not as heat-resistant as less-pricey materials like granite and crushed glass. Seams can be noticeable, especially if you use lighter colors, and it can discolor over time in direct sunlight.

Also, quartz can look ultra-contemporary and cold, so it may not be the best choice for a traditional-style kitchen.

#2 Granite ($40 to $100 per square foot)

Granite is still considered one of the top must-have home features, according to a survey of prospective homebuyers from the NATIONAL ASSOCIATION OF REALTORS®. Its natural beauty often is eye-popping, and granite easily fits in any style kitchen.

Pros

Granite is tough. It resists cracks and chips, and you can place a hot pot on it without catastrophe. If you apply sealer annually, granite stands up to stains. 

Cons

It’s tough but not indestructible. An accidental clunk with a wine bottle can put a chip in the edge, which you’ll have to polish down. If you don’t seal religiously, oil can seep into the stone and you’ll have to apply a poultice to get it out.

Design-wise, granite can be unpredictable. Natural variations in stone can result in countertops that don’t look exactly like the sample. Also, it can be hard to hide seams in granite countertops, so be strategic about where you put them.

#3 Crushed (Recycled) Glass ($60 to $120 per square foot)

This relative newcomer to the countertop market is as stunning as it is durable. Glass is recycled from beer bottles, traffic lights, and windshields, making it an eco-friendly countertop choice.

There are two basic styles to choose from: When set in acrylic, the glass looks like it’s floating in a lake; when set in cement, the glass creates a shimmery mosaic. 

Pros

Crushed glass counters don’t chip, scratch, stain, or burn. They’re nonporous, so they don’t need sealing, like granite. Crushed glass doesn’t fade over time, like quartz.

Cons

If you place something heavy on the corner of a crushed glass countertop, it may crack. Acidic foods, like citrus juices, can eat away at the acrylic if you don’t wipe them away quickly. 

Price can be a “con.” Where you can pick up a low-end granite for $40 per square foot, crushed glass starts at $60.

#4 Laminate ($10 to $40 per square foot)

Laminate kitchen countertops are a paper-plastic product that tops several layers of Kraft paper with a resin impregnated with near infinite colors and patterns. 

Pros

The price is right for this chameleon-like product that can mimic everything from wood to granite. It doesn’t need any special sealers or cleaners, and it’s stain resistant. 

Cons

Laminates crack, scratch, and scorch more easily than the countertop materials it resembles. It’s also a bear to repair.

More important, many buyers avoid laminate in droves. A study from the National Association of Home Builders says that 40% of prospective homebuyers would be unlikely to buy a house with laminate counters.

#5 Tile ($5 to $30 per square foot)

Tile countertops can look crafty or contemporary, making them a beautiful and versatile countertop material.

Pros

Tile is tough and easy to clean. It resists cuts, stains, and heat. And if a tile cracks, it’s easily replaced. 

Tile also comes in an infinite number of colors and styles. You can mix and match to achieve a unique look that makes your counter one of a kind.

Cons

Tile easily cracks if skillets and pots are accidentally dropped on it. It’s an uneven surface that can make glasses, plates, and cutting boards wobbly and unstable. 

Unlike stone surfaces, you can’t roll out dough on a tile countertop. And grout lines are common catchers of dust and grime; if you don’t keep up on annual sealing, they’re a great medium for bacteria growth.

#6 Solid-Surfacing ($35 to $100 per square foot)

You probably know it as Corian, but that’s just one manufacturer of this solid-surface countertop that’s made from acrylic, polyester resins, and even marble dust. 

Pros

Solid-surfacing comes in many patterns and colors. It’s nonporous and doesn’t require special sealers or cleaners. Scratches are easily sanded out. It can be molded to include a seamless backsplash or integrated sink bowl.

Cons

It’s pricey, and it doesn’t have the charm of granite or quartz. It scratches and burns easily. Plus, it’s made of non-renewable resources, it’s energy-intensive to manufacture, and it’s difficult to recycle — not a great “green” choice.