The turmoil in the stock market hasn’t hurt homeowners’ plans to spend on their properties this year, according to a new Angie’s List survey.
The survey found that among homeowners who’ve already set their spending budgets for 2016, nearly 79 percent plan to spend as much or more on home improvement projects compared to last year.
That’s good news for service providers, who are also optimistic about 2016. More than 90 percent of them said they expect homeowners to spend as much or more on projects as they did last year.
The survey found that millennials plan to spend as much as or more than older homeowners on home improvements.
The Angie’s List findings confirms a report issued by the Joint Center for Housing Studies at Harvard University last month, which projected that home remodeling would pick up this summer. The Leading Indicator of Remodeling Activities projected that annual spending on home improvement projects in 2016 could surpass its 2006 peak, on nominal terms.
The report shows expected home improvement spending of $148 billion in the second quarter of this year, followed by $155 billion in the third quarter.
Home-improvement projects are making more sense as an investment than they have in recent years. While most renovations don’t pay off dollar-for-dollar when you sell a home, the return on investment for remodeling projects in 2015 increased to 64.4 percent in 2016, up from 62 percent in 2015 and the second-highest return in the past eight years, according to Remodeling magazine.
When you put your house on the market, it goes without saying that you want the best price when it sells.
But many sellers shoot themselves in the foot, doing things that will torpedo their home’s selling price and net them less money. Plus, there are certain home and neighborhood characteristics that all the staging in the world can’t overcome, once again dragging down the price.
In a really hot market, or in certain desirable areas, as Redfin Chief Economist Nela Richardson puts it, “any house standing upright can get a bid.” But she also notes that Redfin’s new Housing Demand Index shows that home sales are slowing.
“What we’ve seen is that the market has changed dramatically in the last two months,” Richardson says. “Prices are slowing considerably.”
While inventory of homes for sale is still low and many buyers are still looking for homes, they’re not willing to pay just any price. “They’re making more conservative decisions,” Richardson says. “What our agents are telling a lot of buyers is just wait.”
The latest Case-Shiller index found that housing price growth is slowing, with prices up 4.4 percent in May 2015 vs. May 2014. That’s essentially flat compared with April’s 4.3 percent annual increase, and once season adjustments were factored in, the National Index showed no change from April to May.
“Sellers are still firmly in control, but they’re not getting a free pass,” Richardson says.
Here are nine factors that can keep you from getting the best price for your home.
Overpricing. By far, the biggest mistake sellers make is to set their home price too high, thinking would-be buyers will offer a lower price and they can use that as the starting point for negotiations. “If you misprice it in the beginning, it can tend to languish, and you may end up selling it for less than you would have if you had priced it correctly to begin with,” says Kevin Brown Jr., president of Praedium Real Estate Services in Pittsburgh and a regional director of the National Association of Exclusive Buyer Agents. Houses that are overpriced tend to stay on the market longer, which makes buyers suspicious that there is something wrong with the home. “Right now, people are expecting they will receive multiple offers, and their house will sell for over asking price, no matter what,” says Sabrina Booth, an agent with Redfin in Seattle. “They tend to shy away from houses that come on the market overpriced. We’re seeing less competition at this time.”
Bad pictures. Nearly all home shoppers these days start their searches online, and they decide which homes they want to see based on the photos posted with the listing. Not surprisingly, blurry cellphone shots don’t draw much interest. “People just skip over it,” says Matt Francis, branch manager of Better Homes and Gardens Mason-McDuffie Real Estate in the San Francisco Bay Area. “The millennial buyer is not interested in what it can become.”
Difficulty showing the house. In these days of instant gratification, home shoppers want to see homes as soon as possible and at their convenience. If you make your home difficult to show, fewer prospects will see it, and it can take you longer to find a buyer. “If you don’t show it, you can’t sell it,” Francis says.
Messy neighbors. The proverbial neighbors with the unkempt lawn, couch on the porch and junk cars in the yard do indeed bring down property values. If your neighbors’ houses and yards look bad, home shoppers are likely to put a lower value on your home. You could try to reason with these neighbors and ask them to clean up, or even do the work for them. But your success rate will vary by neighbor, and some may be opposed.
In bad company. If the most recent sales of homes like yours in your neighborhood have been at low prices, that is likely to hurt the price of your home. That’s because real estate agents and appraisers base their view of home value on the sales of comparable homes nearby.
Bad location. If your house is next to an apartment building, a busy street, a school or otherwise is in an area that is considered less desirable, it will sell for less than a comparable home in a quieter area. In family areas, being in a bad school district also hurts home values significantly. In cities that rely heavily on mass transit, being too far from transit stops may be a detriment. If your home is near a noisy road, you may also have trouble getting full value for it.
Compartmentalized rooms or a dark first floor. “People these days want bright, airy, open,” Francis says. If your home is dark or has a lot of small rooms rather than a larger open space, that makes it less desirable and therefore likely to sell at a lower price.
Structural defects. No amount of granite or stainless steel can compensate for structural issues such as foundation problems. Buyers are wary of homes that need these kinds of repairs because it’s difficult to estimate how much they will really cost to solve.
Dirt and grime. If your house is messy, your yard is unkempt and the windows are grimy, it is not going to put its best foot forward. Most buyers will have a hard time getting past that initial negative first impression, and failing to clean up your home could cost you a lot of money.
Copyright 2015 U.S. News & World Report
Written by Teresa Mears of U.S. News & World Report
People are willing to pay a premium to live in some places. That’s because the most expensive U.S. cities—Boston, New York and San Francisco, to name a few—offer abundant job opportunities in high-paying fields, plus plenty of entertainment options.
But what about the other way around? Will some places pay a premium for you to move or live there? We discovered seven that do. They offer such enticements as free lots, housing allowances, tax rebates and student-loan reimbursement to persuade people to join their communities. Many of these places are small Midwestern towns that have struggled to hang on to their younger residents, who often move elsewhere after college for more opportunities. But a few are bigger cities trying to revitalize their urban cores.
If you’re thinking about moving, consider relocating to a place that wants you enough to pay you to move there. Check them out.