Buying a Home

What To Expect When You Buy A Fixer Upper

January 20, 2022 by khproperties Leave a Comment

It feels like you can’t turn on the TV and flip through the channels without seeing a home improvement show, but don’t be taken in by their simplicity. Remodelling your home is far more complex and usually more expensive than TV pundits lead you to believe. When they even bother to price the items of a project, the labor costs are often conveniently forgotten because they can be 50% of the total expenditure. Contractors don’t appear out of nowhere, and gardeners won’t just magically appear with half a forest for the backyard. You’ll learn an incredible amount about property ownership if you purchase a fixer-upper and set about a major renovation. But if you’re a first-time buyer who’s looking for a bargain to renovate, remember that while it’s a great strategy, you’ll need to be prepared for hard work before you enjoy the incredible satisfaction of creating a wonderful home.

Here’s a quick guide of what to expect to get you started:

Ignore TV shows: Nothing will put you in a world of renovation pain than believing the pricing you see in reality TV shows. Labor costs are a fundamental reality and rarely rate a mention. Budget for the real world.
Create a budget and then some: The most important aspect of remodeling a home is to create a budget that you can afford and then stick to it. But remember most renovations cost more than you think. Experts recommend you keep aside 20% of the project’s cost in case of problems.
Quotes come in writing: Always insist on receiving an estimate in writing rather than believing a verbal estimate that might be contested or ignored later. When the invoice comes in, you may find yourself with a nasty surprise.
Expertise counts: If your budget will stretch, call in the experts. An architect, lighting consultant and interior designer will transform your project. And given you’re investing in your most significant financial asset, consider the dollar value they might add.
Advice vs Opinion: Friends will offer their ideas and opinions, and architects and contractors will provide advice. Be sure to know the difference. Ultimately, the decisions are on you and you’ll need to live with the consequences of your choices.
Focus on you: Unless you want to flip the property, then remodel for your lifestyle and don’t worry about fashions or fads. If you’re flipping, the reverse is true. Make decisions that will maximize the sale price.
Minimize your role: Hire a general contractor who’ll coordinate sub-contractors for the entire project. Avoid the hassle of organizing tradespeople. One bad apple will throw out your timeline and cause friction with the others.
Stop and shop: It can be a good idea to avoid buying materials from multiple suppliers all over town. That quickly gets very confusing, especially when it comes to delivery schedules. Ideally, purchase from only one or two suppliers. Apart from construction materials, it’s also recommended to get a dumpster rental for a more efficient construction cleanup during and after the renovations.
Be tactile: Don’t rely on the internet when you shop. Faucets can look amazing online but turn out to be cheap and nasty when you open the box. Go to each store and literally touch the items you want to buy. Ask for swatches of cloth and colours, buy tester cans of paint, and take your time with all your decisions.

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Is An Open Floorplan The Right Style For You?

December 27, 2021 by khproperties Leave a Comment

Open floorplan living is often billed as the perfect floor plan, bringing family together in a single room where cooking, conversation and the screen share the same space. It has been a popular feature of a home for two decades and more. However, a small but noisy school of thought now suggests it’s time to revert to the old formula in which rooms have a specific purpose. As experienced agents, we have seen real estate fashions come and go and come again. Perhaps you’re seeking an open floorplan layout for your dream home, or maybe thinking that smaller rooms are easier to maintain, and heat and cool.

If you’re searching for a home right now, we’ve pulled together a list of benefits and drawbacks to open floorplan living. It might help you consider a broader range of properties if you’re aware of all the pros and cons of various designs and floor plans. You may also want to see the best grey vinyl flooring option here for a stronger, more durable form of vinyl planks that address all your flooring needs!

If you have a home gym, it is advisable to install high quality, fully compliant floors for sports, fitness and exercise? It’s also very important to have the very best quality sprung flooring installed as that makes a huge difference to the people using it, so we have the very best.

Open Floorplan Benefits

A living area where no boundaries lie between leisure and the kitchen will be a magnet for the entire family at least twice a day. Interaction is essential for a harmonious household – especially if you have teenagers – and open floorplan living helps you achieve this. However, if you’d like to update your kitchen with the latest design trends, then check out Gamma Cabinetry LLC to learn more!
Young families will benefit because it is far easier for mom or dad to keep an eye on young children. It also avoids the temptation to pack them off to their bedroom or playroom, where they won’t see you or talk to you.
For anyone who loves entertaining, open floorplan living is essential. You can slave over your stove while not being excluded from your guests or supervise homework while cooking the evening meal.

Open Floorplan Drawbacks

It’s usually the highest maintenance area of the home. With so many activities going on, there’ll inevitably be a mess at the end of the day. For example, folks often use the island bench as a dumping ground for bags and keys. If you love a tidy home, you might find yourself continually cleaning.
It’s a privacy killer. Without a sound barrier, it’s hard to read a book when the TV is on or there’s a conversation in the kitchen. When the phone rings, everyone else in the room is asked to keep quiet, or you’ll need to take the call elsewhere.
Decorating an open floorplan area can be tricky. Furniture needs to match and be of a similar size especially if you are using wicker furniture. The visual balance of an open floorplan area can be ruined if your couch is far larger than your dining table. If you need new furniture, you can find furniture online from Ideal Furniture Galleries and similar stores.

8 Tips For First Time Homebuyers

December 1, 2021 by khproperties Leave a Comment

Being a first time homebuyer can feel quite intimidating – you’ve got to deal with agents, sellers, rival buyers, banks, and title companies. And it’s not always clear what role each of them plays in the process. We have worked with many first time homebuyers. It’s great to guide them on the journey of property ownership and help set them on the path to building their wealth through real estate.

Any first time homebuyer should appreciate that they always have access to many professionals who can help explain the various tasks and processes required to buy a home. It’s not like you’ll walk through the experience blindfolded.

To help you on your way and find out more, here’s a quick list of tips for first time homebuyers. You’ll find the act of buying property is not as intimidating as you might have feared.

Start saving: That means not only reducing your day-to-day spending but also working to reduce regular payments on debts for items such as a car or personal loan. These obligations will reduce the amount of money a lender will allow you to borrow.
Work out a budget: Investigate how much you might be able to borrow. Factor in the expenses of buying a home, such as closing costs and moving. You should then have an idea of what you can afford. Setting your expectations early on will focus your home hunting efforts and avoid disappointment.
Arrange financing: Spend time exploring your options. Some banks demand a 20% deposit; others are more flexible. Perhaps your parents will co-sign for the loan, or part of it. Consider using a local lender as they will guide you and recommend suitable loan options.
Pre-approval is good: A lender won’t give you a pile of cash based on your salary. They’ll grant “pre-approval,” which means you can make a monetary commitment with confidence. However, the lender will finalize its approval once they’ve valued and approved the property you intend to buy. Do not sign any document that waives your right to pull out of a transaction until you are approved or you risk your lender refusing you.
Get mentally prepared: With your finances lined up, you need to think about the dynamics of buying a home. If you find your dream place, you better believe others will love it, too. So, be prepared to move quickly to beat the competition.
Find a great agent: For a first time homebuyer, a great agent will make the experience smoother and less stressful. When selecting an agent, ask each one to share with you properties they’ve bought for other clients. This will indicate whether they can find what you’re seeking.
Go hunting: House hunting is fun but exhausting. In a hot market, it can get stressful because of buyer competition. Don’t be put off, and keep your focus. You may miss out on a few properties, but there are many more out there.
Be confident: When making an offer for a home, be confident. Don’t ask your agent to make low ball offers just to see if the seller bites. You risk being labelled a time waster and go to the back of the line. You have every right to make any offer, but be realistic if you want the property.

FIRPTA – The Foreign Investment in Real Property Tax Act of 1980

August 25, 2020 by khproperties Leave a Comment

The first time you hear someone say FIRPTA out loud (sound it out as if it was a word and not an acronym), you’re more than likely to think that person is making words up. Like many acts of the US government, FIRPTA has a much lengthier and descriptive name: The Foreign investment in Real Property Tax Act of 1980. The act allows for tax withholding and reporting when a “foreign person” (see below) sells real estate in the United States. FIRPTA puts the obligations for withholding and reporting onto the buyer, which can make it a little frightening if you’ve never dealt with it as a buyer. As with most things in real estate (as mentioned on the homepage), it’s all a matter of asking the right questions and talking to qualified people who understand FIRPTA and know how best to advise you when you find yourself in this situation. For the best property related issues, https://itripfranchise.com/ this link had to be reached.

First, let’s define “foreign person.” According to FIRPTA, a foreign person is 1) an individual that is not a US citizen or a resident alien, 2) a foreign corporation that is not being treated as a domestic corporation, or 3) a foreign partnership, trust, or estate.

Under FIRPTA, a buyer must withhold a percentage of the “amount realized” (purchase price) and within 20 days of closing report and pay the tax to the IRS. The percentage is determined by several conditions. If the buyer is acquiring property that is not intended to be their residence, FIRPTA requires the buyer to withhold 15%. If the property being acquired is going to be the buyer’s residence, then the percentage of withholding ranges from 0-15% and depends on the sales price. Up to $300,000 it is 0%, over $300,000 and up to $1,000,000 it is 10%, and over $1,000,000 it is 15%. Like many IRS regulations, there are exemptions.

If you are notified that your transaction has triggered FIRPTA, you should call an attorney, CPA, or other tax professional, preferably one familiar with The Foreign Investment in Real Property Tax Act of 1980. As there are exemptions, these professionals can guide you through your situation and recommend what your next steps will be. In many cases, a consultation with a tax professional will allow you to know the seller may be exempt and you as a buyer can move to closing without any further action. Exemptions include a sales price of less than $300,000, a seller able to provide an Affidavit of Non-Foreign Status, a seller providing a FIRPTA Withholding Certificate from IRS, and when sellers are participating in Rental Property 1031 Tax Exchanges and can provide the appropriate information about the sale in writing. As with anything of this nature, the laws and how they work can change over time and we are not tax professionals, so it is best to ask your CPA for tax advice.

In our experience, many of the title companies will provide access and a free consultation with a tax professional who can advise you on your next steps and whether or not you will need to withhold. Further time may be required if it is decided that withholding is necessary as there are rules and as you well know with the IRS, there will be forms to be filled out.

As it is tax related, there are penalties for not withholding the appropriate amount, not reporting it, and not reporting it within the allowed amount of time. And the IRS can tag on interest as well – so you really want to make sure you follow the letter of the law on this one (which is why we highly recommend a tax professional, particularly one with experience with FIRPTA).

While FIRPTA can seem scary at first, with a little patience and consultation with the right people, you can get through the regulations and successfully close on your new home or other property.

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Beneficios de ser dueño de su propia casa.

October 18, 2019 by khproperties Leave a Comment

Felicidad: No hay nada que se compare a la sensación de tener su propio hogar. Puede arreglarlo, darle su propio estilo, tener un perro o un gato, e incluso plantar un árbol si lo desea. ¡Solo imaginarlo causa alegría!

Ahorro de impuestos: el gobierno recompensa a los propietarios de viviendas proporcionándoles excelentes beneficios en los impuestos. El interés pagado por su hipoteca y otros gastos relacionados con el hogar generalmente se pueden deducir de sus ingresos.

Apreciación: Hay un crecimiento de valor en las viviendas con el paso del tiempo; este aumento se convierte en ganancia cuando sea el momento de re-financiar o vender la propiedad.

Renta variable: tanto rentar como alquilar se puede comparar a pagar 100% de interés, pero cuando usted es dueño de una casa y cuenta con una hipoteca, una parte del pago se destina al saldo principal de su préstamo. Esto construye su capital y actúa como una cuenta de ahorros.

Vida en comunidad: quienes son dueños de sus casas son más propensos a permanecer en sus hogares 4 veces más que quienes rentan propiedades. Esto brinda la oportunidad de conocer a sus vecinos y conectarse con su comunidad.

Educación: las investigaciones muestran que los hijos de los propietarios de viviendas obtienen puntajes más altos en exámenes y se gradúan en un porcentaje más alto que los hijos de inquilinos.

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Downpayments: How Much Should You Pay Up Front?

July 10, 2019 by khproperties Leave a Comment

If you’re going to be buying a home any time soon, you’re going to need to start thinking about your downpayment. Typically expressed as a percentage of the sales price, the downpayment is often one of the more difficult obstacles for people to overcome on their way to home ownership. You’ll need to budget your money and save up enough to make your downpayment, but how much will you need? You’ve probably heard the rule – you’ll need to save for a 20% downpayment before you buy a home. The logic behind saving 20% is solid, as it shows that you have the financial discipline and stability to save for a long term goal and it can also help you get favorable interest rates from your lender. Additionally, the bigger your downpayment, the less you need to borrow, so the less you’ll pay in interest in the long run.

But there can actually be financial benefits to putting down a smaller downpayment — as low as three percent – rather than parting with so much cash up front, even if you have the money available.

The Downside of a Small Downpayment

The downsides of a smaller downpayment are pretty well known. You’ll have to pay private mortgage insurance (often referred to as just PMI) for years, and the lower your downpayment, the more you’ll pay. You’ll also be offered a lesser loan amount than borrowers who have a 20% downpayment, which will put some higher priced homes out of reach for you when searching.

THe Upside of a Small Downpayment

The national average for home appreciation is about five percent. The appreciation is independent from your home payment, so whether you put down 20% or three percent, the increase in equity is going to be the same. If you’re looking at your home as an investment, putting down a smaller amount can lead to a higher return on investment, while also leaving more of your savings free for home repairs, upgrades, or other investment opportunities.

The Happy Medium

Of course, your home payment options aren’t binary. Most borrowers can find some common ground between the security of a traditional 20% and an investment focused, small downpayment. It’s always a good idea to talk with your Realtor and your lender to discuss the potential paths for you and to see what strategy works best for you and your personal needs.

image courtesy of AleXander Agopian