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Staging for a Cozy, Minimalist Look

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Staging for a Cozy, Minimalist Look

Staging for a Cozy, Minimalist Look

Real estate agents often have to work with either barren rooms or sloppy, overstuffed spaces. But what’s truly attracting the most buyers right now is a deft balance of tidy austerity and a comfortable, lived-in feel.

staged living room

While decluttering a listing before putting it on the market will help sellers keep their homes cleaner and get a head start on packing, this practice also helps the product that’s for sale shine through more clearly. “Staging isn’t about decorating, but putting a room and its architecture in the best light,” says Chicago-area designer and stager Paula Winter.

Watch for these signs that you’re tipping the balance too far in one direction.

Too intimate:

Yellow; rich, dark colors; and textured or faux Tuscan-painted walls

Elaborate window treatments

Family photos

Floral or oversized patterns

Every wall covered with art

Too contrived:

Orchids or other fussy plants

A set table

Matching furniture sets

Nearly empty shelves and storage

Cookies baking in an oven during the open house

But stagers also caution against stripping too much away, which can make a space feel stark and uninviting. The happy medium is instead a modern, minimalist look that permits buyers to imagine how their furnishings may fit in spatially while exuding warmth from some carefully added accessories.

Staging, once mostly for vacant homes or high-priced listings, is now more widely used. Meridith Baer, who stages more than 140 properties a month through her eponymous California firm, says the practice can help increase the sales price and decrease the listing time for homes. The Real Estate Staging Association pegs the average time on the market for homes sold after staging at 21 days, an estimated 90 percent less time than unstaged properties.

Bear in mind that different generations have slightly different design tastes and tolerance for clutter or spareness, as do buyers in different geographic markets and price points. “Many in the greater Los Angeles area have been asking for a more minimal look, but in Orange County and Northern California, high-end properties still reflect a rich layering that shows a well-lived, well-traveled life,” Baer says. Here are five recommendations to strike the right balance.

1. Set the stage. It’s called staging for a reason. The idea is to set the mood in the same way that a theatrical backdrop does. Think of how to use furnishings and accessories to tell a story about how a buyer may live there. You want the listing to look modern and gender-neutral to show a home’s bones, not to remind buyers of an antiseptic hospital or laboratory, says Winter. Certified stager Susan Batka of Aerie Interiors in suburban Atlanta suggests adding a few textured pillows, a rug, and maybe a large piece of modern, colorful artwork to give the space the necessary warmth so it looks alive but isn’t overwhelming or too personalized.

2. Declutter. This is still the number one mantra for stagers. “The key to the desired Zen feel is to pick interesting but fewer decorative items and keep upholstered pieces clean and lean,” Baer says. She describes the goal as leaving “some breathing room. Not every wall space needs art and not every surface needs accessories.” It can be difficult to decide what to keep, but one good rule is to retain only the accessories that play up architectural features and strengths of the listing. Items that draw attention to built-in bookshelves or fireplace mantels are especially helpful. For example, Winter removes half the books on a shelf and arranges the remaining ones with turned-out spines or groups them by colors that work well with the room. She’ll winnow down collectibles on a shelf or coffee table to three key items rather than removing everything.

3. Heed the size and shape of the room. You can use staging to highlight a room’s distinct features. If it has volume due to high ceilings, Baer will use a few larger-scaled furnishings. If it’s long and narrow, she generally fashions two seating groups, turning a rectangle into two squares. That way buyers can imagine a comfortable space where visitors can sit and converse intimately.

4. Retain functionality within today’s style guidelines. Because space is highly valued, making the best use of all square footage remains a priority. Show this in listings by following the principles of cozy minimalism throughout a home. For example, in a master bedroom where buyers are looking to gain a sleep sanctuary, whittle down the furnishings to only the essential items of a comfortable bed, nightstands, and good lighting. The cozy factor can come in the form of blankets, pillows, a soft rug underfoot, and a soothing palette, says Batka. To outfit a spare room or a large landing, you might stage a workspace with a clean, modern desk and comfy upholstered chair.

For more help, consider Home Staging: The Power That Sells Real Estate: 15 Home Staging Experts Share Industry Secrets (OTB Publishing, 2016). If homeowners don’t have au courant items, you can consider renting furnishings; some stagers keep large collections in a warehouse or storage facility. If you decide to hire a stager, know that some might charge an hourly fee, while others may charge anywhere from one-half to three-quarters of 1 percent of a home’s listing price, which is how Refined Interior Staging Solutions’ Helen Bartlett works.

5. Remember inexpensive tweaks. Good staging isn’t about grand gestures, large furnishings, or scads of accessories. Minor fixes can help what’s already there stand out without cluttering the space. Replace fixtures with bulbs of the same wattage and color, and hang clothing on similar hangers for a more uniform feel, says Jennifer Ames, a salesperson with Coldwell Banker Residential Brokerage in Chicago. “It gives buyers a good feeling as they walk through, that the sellers have cleaned and organized their homes,” she says. But in keeping with the cozy factor, avoid overwrought perfection. “Make anything you do look authentic, rather than contrived like putting out place settings at a table,” says Helen Bartlett, a RESA certified stager with Refined Interior Staging Solutions in Fairway, Kan. “Nobody lives that way.”

New Building Materials Redefining Walls

You can’t have a house without walls, yet so few people really consider the materials used to make up this vital component of a home. Learn how new materials, sprays, and decorative finishes offer so much more than just support for a roof.

interior drywall going up

Wall choices may seem ho-hum and routine. But innovative design professionals and entrepreneurs have developed new choices that you as a real estate professional should know about. With a recent onslaught of hurricanes and storms, anxious clients may be interested in products that can help a house better thwart high winds and rain or discourage mold growth in flood situations. Also, Eric Corey Freed, founding principal of Organic Architect in Portland, Ore., recommends real estate professionals learn what’s available for environmental- and health-conscious consumers, such as recycled options that keep raw materials out of landfills, concrete walls that “eat” carbon to remove it from a room’s air supply, and tiles that decoratively cover walls while eliminating contaminating gases for those highly sensitive to certain chemicals.

Many architects, builders, and engineers test their ideas as commercial and industrial wall designs, and then, if they work, adapt them for residential use. However, not every innovation works for every home. Some options won’t meet local building codes or offer a good return on investment, says Erin Hatcher, vice president of sustainability at AMLI Residential, a Chicago-based development and management company.

Here are six options that will expand your wall knowledge to fit today’s market options.

Living “Green Walls”

This product is actually something of a misnomer in that it’s more of a host for living plants than an actual “living wall.” The greenery doesn’t make up the actual wall support, but rather adds a living cover to a small wall area or expanse, which offers structural and nutritional support. Some popular plant choices include philodendron, pothos, and spider plants. In an exterior wall, homeowners should select plants based on a home’s USDA zone. For interior walls, the amount of light plants need should be the determining factor.

Why it’s noteworthy: When used outdoors, living walls can protect structures from inclement weather and ultraviolet rays. Indoors, they’re prized for their ability to remove toxins, add pleasant smells and textures, and even improve residents’ mental health. “Living plants have been shown to improve a person’s mood and increase productivity,” says Matthew Hills, a project manager with Ambius in Redding, Penn., an industry leader in this field. He advises grouping different plants on the same wall to help mitigate a variety of pollutants. “A spider plant removes carbon dioxide twice as much as a philodendron does,” he notes. The NASA Clean Air Study offers a list of common indoor plants and the toxins they can remove from the air. Finally, Mike Haynes—sales and marketing coordinator with Livewall in Spring Lake, Mich., which provides support systems for green walls—adds that they can create an acoustic barrier for a more peaceful setting. Homeowners can purchase DIY kits or rely on garden professionals to build and plant the walls.

Price per square foot: Varies based on the size of the wall and options, such as built-in irrigation. Ambius’ options range from $80 to $200; maintenance visits are extra. Livewall’s range from $85 to $135.

Mycelium Panels and Insulation

The rootlike fibers of mushrooms, otherwise known as mycelium, are being used to create wall panels and tiles. Ecovative Design, an upstate New York firm, patented the technology after its mechanical engineer founders saw the promise of fungi as “nature’s glue.” The company grows the material in its factor by binding together agricultural waste substrates to the fungal fiber. Ecovative originally used the technology to create lightweight product packaging and insulation, but they recently began selling modular acoustical wall panels.

Why it’s noteworthy: Because the material is renewable and it helps create a new use for agricultural waste, it’s environmentally friendly on two accounts. The tiles’ all-natural origins mean they’re free of volatile organic compounds and other harmful materials. The finished product is also durable, water- and fire-resistant, and compostable.

Price per square foot: Ecovative’s 16-by-16-inch acoustical panels cost $22 each; they also offer a 10-pack of slightly smaller tiles (covering approximately 9 square feet) for $100. The company is still working on scaling its insulation offerings.

Recycled Fly Ash Products

This product recycles waste fly ash, a by-product of coal combustion, into an attractive building material that cuts like wood, can be painted, and is highly durable. One company, Boral TruExterior, uses 70 percent recycled fly ash to create siding for exterior walls, trim components, and interior wall beadboard. “It works better than cement fiberboard, an industry basic,” says architect Nate Kipnis, who focuses on sustainable architecture at his Chicago-based firm, Kipnis Architecture + Planning, and uses the siding and trim on several client projects.

Why it’s noteworthy: Traditional wood products used for siding and trim tend to rot over time and are susceptible to insect damage. By contrast, this material is highly durable and dimensionally stable. Also, the process of creating it removes troublesome fly ash from the waste stream by encapsulating it during the production process.

Price per square foot: About 30 percent more than cement fiberboard, according to Kipnis.

Formaldehyde-Eating Drywall

CertainTeed takes its gypsum board and incorporates a proprietary ingredient that converts formaldehyde—a common VOC—into two separate inert compounds. The product is known as AirRenew and can be used wherever standard drywall board is used, according to Kipnis. Not only is it notable for being free of formaldehyde, it also promises to improve interior air quality by absorbing formaldehyde gassed off by cabinetry, carpeting, paint, adhesives, and and other materials. Tom Prokop, CertainTeed’s innovation and product manager, says AirRenew has been created to continue working for decades, even if new products with formaldehyde are introduced into a room.

Why it’s noteworthy: It looks and weighs the same as drywall, making it ideal for homeowners sensitive to these compounds and similar toxins. “It adds a lot of benefit for a relatively low cost and is one of the cheapest upgrades when building or remodeling,” Prokop says.

Price per square foot: About 25 percent more than standard drywall board, according to Kipnis.

Barn Wood Wall Panels

Homeowners who are looking for a rustic, hand-hewn look might consider recycled barn wood. Several companies have taken this desirable material and made it easier to work with. Different companies offer slightly different takes on the concept. Viridian Reclaimed Wood makes an easy do-it-yourself stick-and-peel paneling from fencing that it has dubbed “Good Neighbor,” after the Robert Frost poem. The Portland, Ore., company finishes the rustic material to be sure it’s fire-rated and offers it in different updated hues of natural, clear, Tiffany blue, white, and black. Another company, Kith + Kin Walls, offers engineered wood planks that feature the texture of wood grain and color variations of reclaimed barn wood but are delivered in more consistent sizes than are found on barns to simplify installation. Home owners who like DIY work should know what’s involved. With Veridian’s materials, DIYers must use a razor knife to cut excess, then peel and stick the panels. Taking them down later is tougher, since they’re considered a semipermanent installation. “Walls would require patching,” says Veridian co-founder Pierce Henley. His company’s product also wouldn’t work on concrete walls. Kith + Kin’s barn wood planks come in planks that require using a nail gun and saw to install.

Why it’s noteworthy: Viridian’s panels are environmentally friendly and lack VOCs, and its adhesive is rated to last at least 10 years. Kith + Kin feature a soft backing to protect walls and increase sound insulation.

Price per square foot: Veridian’s are $10.50, while Kith + Kin’s come in a box of 20-square-foot lengths for $228.70. Both companies offer online calculators to measure how much wood is required.

Thermal Wall Insulator

Energy efficiency can take a big hit through what’s called “thermal bridging,” when one section of a wall conducts heat much quicker than another, leading to condensation and less comfortable interiors, especially in cold weather. Historically, builders have used insulation, thermal break pads, or specific framing techniques to mitigate this problem, but there’s a newer option that can be more easily applied to an existing structure. Aerolon coating—a VOC-free, resin-based product by the Righter Group—uses Aerogel (produced by another company, Cabot Corp.) to manufacture its peel and stick tape that goes on walls, along with lintels and other architectural members, to thermally insulate them. The company uses the same Aerogel particle mixture in liquid form, which can be applied to achieve similar effects. Both the tape and fluid can be applied to steel, aluminum, concrete, wood, and other materials. “What the Aerogel particles do,” says Greg Pope, owner and president of the Righter Group in Wilmington, Mass., “is alter the surface temperature and slow heat transfer more efficiently than conventional foam and other insulation do, thereby helping the home retain energy.”

Why it’s noteworthy: One of the biggest problems with residential construction is condensation in wall cavities, which leads to mold and mildew. This helps prevent that from occurring, says Pope.

Price per square foot: $5.

6 Simple Steps to Prep Your Home for Holiday Guests

By: Lisa Kaplan Gordon

Published: November 14, 2011

Make sure extra TP is easy to spot (that’s in #6).

Hosting has its shares of anxieties, especially if you’re striving to make your home welcoming.

How do you know everyone wil feel comfortable?

And will you ever get a chance to relax yourself?

You will if you focus on what’s really necessary. Here’s a list of steps to get your home ready — and take the stress out of hosting.

#1 Declutter

The day before guests arrive is no time to pull apart junk drawers and clean out linen closets.

Declutter guest rooms and public areas — foyer, kitchen, living room, den, and dining room. Remove anything unnecessary from countertops, coffee tables, and ottomans; if it’s out of sight, keep it out of mind, for now.

If you run short of time, bag up the clutter and store it in car trunks, basements, and out-of-the-way closets. Sort and arrange after your guests depart.

#2 Add Night Lights

Even though you can navigate your home blindfolded, your guests can’t. Make sure outside lights are working so they don’t trip on the way to your door. Put motion-activated night lights in hallways, bathrooms, and bedrooms to ensure safe passage after the sun sets.

Related: Outdoor Lighting for Curb Appeal and Safety

#3 Make Space in the Entryway

Your home’s foyer is the first place guests see, so make a good first impression.

  • Place a small rug or welcome mat at the entrance to protect floors from mud and snow.
  • Clear out shoes, umbrellas, and other clutter.
  • Add extra hooks to walls so guests can hang coats and hats.
  • Add a storage bench where guests can remove boots and shoes.

#4 Add a Coffee Station and Extra Stools

Your kitchen is command central during the holidays, so make sure it’s ready for guests and extra helpers.

  • Move your coffee station into a family room so guests don’t crowd the kitchen when you’re trying to fix meals.
  • If you like to visit while you’re cooking, place extra stools and chairs around the perimeter of your kitchen so guests can set a spell.

#5 Create Extra Sleeping Space

If you’ve got a guest room, replace the ceiling fixture with a ceiling fan and light combo, which helps guests customize their room temperature without fiddling with the thermostat for the entire house.

To carve sleeping space out of public areas, buy a folding screen or rolling bookcase, which will provide privacy for sleepers. Fold or roll it away in the morning.

#6 Make Extra Bathroom Supplies Easy to Find

Bring toilet paper, towels, and toiletries out of hiding, and place them on open shelves so guests can find them easily.

If you don’t have enough wall space for shelves, place these items in open baskets around the bathroom.

Also, outfit each tub with a bath mat (to avoid falls) and each toilet with a plunger (to avoid embarrassment).

5 Painting Mistakes That’ll Show

Painting can be one of the most cost-effective ways to spruce up a listing. But homeowners can also make a lot of mistakes with this common DIY job. Realtor.com® recently spoke with staging and color experts to find out some of the most obvious mistakes that they see most often.

1. Choosing the wrong finish.

Homeowners need to select a paint finish that correlates with the room’s purpose. “Many homeowners are nervous about using shiny semigloss, but it’s more durable than flat or matte and more moisture-resistant, which makes it perfect for bathrooms and the kitchen,” Kristen Chuber, marketing director at Paintzen, told realtor.com®. However, flat and matte finishes may make better choices for high-traffic areas like hallways or kids’ rooms, since they usually allow for easier touch-ups.

2. Not paying attention to the room’s undertones.

Pay close attention to the other elements of the room that can influence how the color looks on the walls. “Your color will look off if you pair a pink undertone with a yellow one, so look at the counters, the stone fireplace, and cabinets when choosing paint,” Karen Gray-Plaisted, a home staging expert with Design Solutions KGP, told realtor.com®. The flooring can influence the color perception too. For example, a warm mahogany hardwood might look strange when paired with a cool gray paint, Gray-Plaisted says. Also, be sure to “test your color swatches in different lighting, or you’ll end up with a shade that’s all wrong,” Chuber notes.

3. Selecting the wrong color of white.

White paint comes in many shades. “Some whites are cool, others warm, still more are neutral, so the one you pick will depend on the room’s finishes and undertones,” Gray-Plaisted says. Liat Tzoubari, CEO of home decor boutique Sevensmith, told realtor.com® she sees homeowners overuse white paint in a home. “Instead, choose a white with a slight pink or yellow tint, such as cream,” she suggests.

4. Forgetting about what’s overhead.

Ignoring the ceiling when repainting can make the room appear dull and dirty, says Chuber. “Whether you pick white or a bright color, painting it properly will give you those sharp edges along the top and can make wall color pop,” Chuber says.

5. Adding an accent wall in an odd place.

Adding a pop of color to an accent wall is a popular move, but homeowners should make sure the effect isn’t jarring. “Accent walls are supposed to draw attention to a beautiful area, like the dining room—but not the bathroom or toilet area,” Kaitlin Willhoit, a real estate pro with The Boutique Real Estate Group, told realtor.com®. Also, the paint chosen for the accent wall needs to still work with the overall color scheme of the room or the house, says Bee Heinemann, interior designer with Vant Wall Panels. Too bright or too bold a color may be a turnoff to buyers.

Source: “Time to Brush Up: 9 Ugly Painting Mistakes You’ll Come to Regret,” realtor.com® (Oct. 25, 2017)

Buyers Aren’t Spooked by Haunted Houses

With inventories so tight, many consumers say they’re even willing to live in a haunted house.

Thirty-three percent of more than 1,000 consumers recently surveyed say they’re willing to live in a haunted house, and another 25 percent said they’d consider it, according to a newly released survey by realtor.com®.

“Haunted houses are a popular attraction this time of year, but we wanted to see how many people would actually live in one,” says Sarah Staley, a housing expert who commented on the study’s findings. “What we found may be a sign of today’s tight housing market, or for many living in a haunted house doesn’t have to be a deal breaker.”

Further, 47 percent of respondents said they’d live in a home where someone has died, and 27 percent additional respondents said they’d at least consider it, according to the survey.

Still, 40 percent of consumers said they’d need a price reduction in order to choose a haunted home over a non-haunted home. Also, a good neighborhood, extra square footage, and more bedrooms would convince them too, according to the survey. On the other hand, 42 percent of respondents insist they aren’t open to the idea of buying a haunted home, even for those extra perks.

For some consumers, living in a haunted house may not be considered a stretch because they claim they’ve already lived in one. For example, 28 percent of respondents said they have lived in a haunted house, and another 14 percent think they may have. They say their house was haunted because of strange noises, odd feelings in certain rooms, and even some reports of objects moving or disappearing.

Source: realtor.com®

 

6 Easy Ways to Boost Curb Appeal

The exterior of the home counts big for creating first impressions. Indeed, 99 percent of real estate pros say that curb appeal is a critical factor in attracting a buyer, according to the National Association of REALTORS®’ 2016 Remodeling Impact: Outdoor Features survey.

Get more ideas: Amp Up Curb Appeal

Here are a few things you can do to enhance the curb appeal to your listing:

1. Paint colorful flowers.

Adding colorful flowers, like yellows or pinks, to your landscaping can be the pop of color needed to attract buyers. Visit the local nursery or garden center to learn which varieties are the most hardy for where you live.

2. Freshen up the mailbox.

The mailbox counts too in adding curb appeal. Consider a new mailbox, or try to save the old one with a fresh coat of paint. Add new numbers to the box to spruce it up too.

3. Pressure wash.

Driveways can develop oil stains and a deck can show some wear and tear. To remove pesky stains, power wash the deck and driveway to get them clean.

4. Add lighting to walkways.

Beckon buyers to the front door by adding lighting to the path to the door. This will also create a clean border along your walkway. Select solar-powered LED outdoor lights, which don’t require any wiring, to brighten up the exterior pathways.

5. Revisit the front door.

Invest in a new door if the current one is looking too old and dingy. A fresh coat of paint may help improve an existing one, if a new door isn’t in the budget. Consider a new color, like red. Also, replace the hardware, like the doorbell and locks, to give the front door a fresh new look.

6. Repaint the shutters.

Painting the entire house may not be in the budget, but sellers can still make a big impact to the exterior by painting just the shutters. They might even want to consider changing up the color to boost their curb appeal.

View more curb appeal tips and photos at Cheatsheet.com.

Source: “Foolproof Upgrades That Will Instantly Improve Your Home’s Curb Appeal,” Cheetsheet.com (Sept. 26, 2017)

5 Ways to Make Your Listing Look Bigger

Décor choices can have a big impact on how large or small a home appears. Professional home stagers chime in with some tips on how to show off square footage, even when space is tight.

  1. Remove heavy drapes. Leave windows bare or hang sheer linen curtains. The space will feel brighter, and “you’ll extend the view to the outdoors, which will automatically make your space feel larger,” home staging expert Lori Matzke told realtor.com®.
  2. Go monochrome. Painting ever single room in the same color can help lengthen a smaller space. It “prevents your space from feeling choppy and gives it more of a continuous feel,” Matzke says. Furnishings and accessories should also be monochrome. Reduce contrasting colors whenever possible, says Justin M. Riordan, founder of Portland, Ore., and Seattle-based Spade and Archer Design Agency. “If you have a room with taupe walls, walnut floors, a brown sofa, and milk-chocolate pillows—all various names for medium brown—the edges of each item will be less defined and, in turn, be perceived as taking up less space,” Riordan says.
  3. Remove rugs. “The more you break up the flow of your flooring, the smaller your space will feel,” Matzke says. Limit rugs to only one or two main areas, such as under the dining table. Also, small rugs can dwarf a space, so when you do use them, make sure they aren’t too tiny.
  4. Add mirrors to rooms. Mirrors can help make a small room appear larger by reflecting more natural light, Bee Heinemann, marketing director and interior decorating expert at Vänt Wall Panels told realtor.com®. Consider placing a mirror next to or directly across from a window to add more depth to the room.
  5. Raise the bar (in the bathroom). Place shower curtains and window treatments higher up on the wall. “Hang it as high as you can,” Heinemann says. “Doing so gives the illusion of higher ceilings and greater space.”

Source: “14 Sneaky Staging Tips for Selling a Small Home,” realtor.com® (Sept. 6, 2017)

Fall May Be Best Time for Buyers to Move

A slower fall season in home buying may help more lingering home buyers to jump in.

Prices are easing somewhat. For the second month in a row, the median price of an existing home dropped. It reached $253,500 in August, after reaching a record high of $263,300 in June, according to the latest data from the National Association of REALTORS®.

Read more: 4 Home Maintenance Tasks to Tackle Now

“Median sales prices typically decline a bit heading into the fall,” says Danielle Hale, realtor.com®’s chief economist. “Summer is a big time for home purchases, so that families settle in before school starts in the fall. In the fall, the types of homes that sell are smaller for people without kids. So they tend to be less expensive.”

Existing homes are proving to be a bargain compared to newer homes. The median price of a new home reached $313,700 in July, which is 23.7 percent higher than an existing home.

Home buyers may find attractive mortgage rates this fall. Mortgage rates are still under the 4 percent psychological threshold, which can be a luring incentive for borrowers. Freddie Mac reported last week that the 30-year fixed rate averaged 3.78 percent, holding steady at a 2017 low.

Studies have shown that fall can be the best time to buy. A study conducted by RealtyTrac in 2015 found that October was the best month for home buyers. Purchasers in October paid 2.6 percent below the estimated market value at the time for their home, according to the analysis. In other words, buyers interested in a $300,000 home tend to see a $7,800 discount on it in the fall. Oct. 8 was found to have the best day for bargains too, with an average of 10.8 percent below estimated market value, according to the study.

Home sales in August started to decline heading into the fall season. Sales of existing homes fell 1.7 percent from July to August, but NAR mostly blamed the decrease on the limited number of listings for sale on the market.

Properties are staying on the market for less time, so buyers will need to be ready to act fast. Fifty-one percent of homes sold in August were on the market for less than a month, according to NAR. Properties typically stayed on the market for just 30 days in August.

Source: “Why It’s a Better Time for Buyers on a Budget to Purchase a Home,” realtor.com® (Sept. 20, 2017)

5 Surprising (and Useful!) Ways to Save for a Down Payment

By: Erik Sherman

One of the biggest misconceptions of home buying? The 20% down payment. Here’s how to buy with a lot less down.

Buying your first home conjures up all kinds of warm and fuzzy emotions: pride, joy, contentment. But before you get to the good stuff, you’ve got to cobble together a down payment, a daunting sum if you follow the textbook advice to squirrel away 20% of a home’s cost.

Here are five creative ways to build your down-payment nest egg faster than you may have ever imagined.

1. Crowdsource Your Dream Home

You may have heard of people using sites like Kickstarter to fund creative projects like short films and concert tours. Well, who says you can’t crowdsource your first home? Forget the traditional registry, the fine china, and the 16-speed blender. Use sites like Feather the Nest and Hatch My House to raise your down payment. Hatch My House says it’s helped Americans raise more than $2 million for down payments.

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2. Ask the Seller to Help (Really!)

When sellers want to a get a deal done quickly, they might be willing to assist buyers with the closing costs. Fewer closing costs = more money you can apply toward your deposit.

“They’re called seller concessions,” says Ray Rodriguez, regional mortgage sales manager for the New York metro area at TD Bank. Talk with your real estate agent. She might help you negotiate for something like 2% of the overall sales price in concessions to help with the closing costs.

There are limits on concessions depending on the type of mortgage you get. For FHA mortgages, the cap is 6% of the sale price. For Fannie Mae-guaranteed loans, the caps vary between 3% and 9%, depending on the ratio between how much you put down and the amount you finance. Individual banks have varying caps on concessions.

No matter where they net out, concessions must be part of the purchase contract.

Related: New Law Protects You from Surprise Closing Costs

3. Look into Government Options

The U.S. Department of Housing and Urban Development, or HUD, offers a number of homeownership programs, including assistance with down payment and closing costs. These are typically available for people who meet particular income or location requirements. HUD has a list of links by state that direct you to the appropriate page for information about your state.

HUD offers help based on profession as well. If you’re a law enforcement officer, firefighter, teacher, or EMT, you may be eligible under its Good Neighbor Next Door Sales Program for a 50% discount on a house’s HUD-appraised value in “revitalization areas.” Those areas are designated by Congress for  homeownership opportunities. And if you qualify for an FHA-insured mortgage under this program, the down payment is only $100; you can even finance the closing costs.

For veterans, the VA will guarantee part of a home loan through commercial lenders. Often, there’s no down payment or private mortgage insurance required, and the program helps borrowers secure a competitive interest rate.

Some cities also offer homeownership help. “The city of Hartford has the HouseHartford Program that gives down payment assistance and closing cost assistance,” says Matthew Carbray, a certified financial planner with Ridgeline Financial Partners and Carbray Staunton Financial Planners in Avon, Conn. The program partners with lenders, real estate attorneys, and homebuyer counseling agencies and has helped 1,200 low-income families.

4. Check with Your Employer

Employer Assisted Housing (EAH) programs help connect low- to moderate-income workers with down payment assistance through their employer. In Pennsylvania, if you work for a participating EAH employer, you can apply for a loan of up to $8,000 for down payment and closing cost assistance. The loan is interest-free and borrowers have 10 years to pay it back.

Washington University in St. Louis offers forgivable loans to qualified employees who want to purchase housing in specific city neighborhoods. University employees receive the lesser of 5% of the purchase price or $6,000 toward down payment or closing costs.

Ask the human resources or benefits personnel at your employer if the company is part of an EAH program.

5. Take Advantage of Special Lender Programs

Finally, many lenders offer programs to help people buy a home with a small down payment. “I would say that the biggest misconception [of homebuying] is that you need 20% for the down payment of a house,” says Rodriguez. “There are a lot of programs out there that need a total of 3% or 3.5% down.”

FHA mortgages, for example, can require as little as 3.5%. But bear in mind that there are both upfront and monthly mortgage insurance payments. “The mortgage insurance could add another $300 to your monthly mortgage payment,” Rodriguez says.

Some lender programs go even further. TD Bank, for example, offers a 3% down payment with no mortgage insurance program, and other banks may have similar offerings. “Check with your regional bank,” Rodriguez says. “Maybe they have their own first-time buyer program.”

Not so daunting after all, is it? There’s actually a lot of help available to many first-time buyers who want to achieve their homeownership dreams. All you need to do is a little research — and start peeking at those home listings!

6 Tips for Choosing the Best Offer for Your Home

By: G. M. Filisko

Have a plan for reviewing purchase offers so you don’t let the best slip through your fingers.

You’ve worked hard to get your home ready for sale and to price it properly. With any luck, offers will come quickly. You’ll need to review each carefully to determine its strengths and drawbacks and pick one to accept. Here’s a plan for evaluating offers.

1. Understand the process.

All offers are negotiable, as your agent will tell you. When you receive an offer, you can accept it, reject it, or respond by asking that terms be modified, which is called making a counteroffer.

2. Set baselines.

Decide in advance what terms are most important to you. For instance, if price is most important, you may need to be flexible on your closing date. Or if you want certainty that the transaction won’t fall apart because the buyer can’t get a mortgage, require a prequalified or cash buyer.

3. Create an offer review process.

If you think your home will receive multiple offers, work with your agent to establish a time frame during which buyers must submit offers. That gives your agent time to market your home to as many potential buyers as possible, and you time to review all the offers you receive.

4. Don’t take offers personally.

Selling your home can be emotional. But it’s simply a business transaction, and you should treat it that way. If your agent tells you a buyer complained that your kitchen is horribly outdated, justifying a lowball offer, don’t be offended. Consider it a sign the buyer is interested and understand that those comments are a negotiating tactic. Negotiate in kind.

5. Review every term.

Carefully evaluate all the terms of each offer. Price is important, but so are other terms. Is the buyer asking for property or fixtures — such as appliances, furniture, or window treatments — to be included in the sale that you plan to take with you?

Is the amount of earnest money the buyer proposes to deposit toward the downpayment sufficient? The lower the earnest money, the less painful it will be for the buyer to forfeit those funds by walking away from the purchase if problems arise.

Have the buyers attach a prequalification or pre-approval letter, which means they’ve already been approved for financing? Or does the offer include a financing or other contingency? If so, the buyers can walk away from the deal if they can’t get a mortgage, and they’ll take their earnest money back, too. Are you comfortable with that uncertainty?

Is the buyer asking you to make concessions, like covering some closing costs? Are you willing, and can you afford to do that? Does the buyer’s proposed closing date mesh with your timeline?

With each factor, ask yourself: Is this a deal breaker, or can I compromise to achieve my ultimate goal of closing the sale?

6. Be creative.

If you’ve received an unacceptable offer through your agent, ask questions to determine what’s most important to the buyer and see if you can meet that need. You may learn the buyer has to move quickly. That may allow you to stand firm on price but offer to close quickly. The key to successfully negotiating the sale is to remain flexible.

G.M. Filisko is an attorney and award-winning writer who has survived several closings. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

Greater Cincinnati Real Estate