Consider Replacing These 4 Things Before Listing Your House

It’s rare that a person can put a home on the market without doing any work. While you might’ve been concentrating on the big changes before you put the “for sale” sign in your yard, it’s important to remember the little things as well. Below are four things you should consider replacing before you put your house up for sale:

Paint. Adding a fresh coat of paint is one of the best ways to liven up the look of your home. If you have the time and ability to do so, repainting both the exterior of your home and all of the rooms is a good way to go. However, if you’re limited on funds, make sure to repaint any area that has seen significant wear and tear.

Broken Locks and Handles. There are likely several broken locks and handles in your home that you’ve grown accustomed to dealing with. These can be major problems, especially if they make a prospective buyer feel unsafe. As such, it’s a good idea to replace any broken locks and door handles before listing your home.

Carpet. Old carpet can wreak havoc on your attempts to sell your home. Not only does it have the possibility of making your rooms look dingy or out-of-date, but old carpet also can hold onto smells no matter how often you’ve attempted a deep cleaning. Consider getting entirely new carpet in your house before putting it on the market—or upgrade to hardwood or vinyl. Making this change can add a great deal of value to your house and remove serious stumbling blocks on the path to getting your home sold.

Garage Door Openers. How well does your current garage door opener work? If it’s having trouble connecting to the overhead unit, or you’ve given up on it entirely, it’s time to get something new. A garage door specialist can help you find the equipment you’ll need to get your garage door functioning like new.

Always make sure to budget for the things you need to replace before you sell your home. With these minor changes–and a little work–you can help transform the way your house looks to prospective buyers.

Source: Meghan Belnap/RISMedia’s Housecall

Contact me for an appointment to see your house and provide additional advice.

3 Smart Ways to Pass Wealth to Your Kids

Leaving money to your kids can cause unwelcome tax burdens unless you plan ahead and do so wisely. Financial experts at The Motley Fool, recommend three smart ways to pass your hard-earned wealth to your children:

Pass the cash – The IRS lets you give up to $14,000 tax-free per year to each child. You may be able to give them additional sums if they have tuition or medical bills. If you pay those bills -- by sending the money directly to the school or healthcare provider(s), not to your child -- then those sums can be tax-free gifts as well.

Spend it on education - You can help your child avoid student loan debt. One way to do this is with a Coverdell Education Savings Account (ESA.) As opposed to a 529 plan, a Coverdell allows you to make investment decisions. While that may not matter to a novice investor, it means that a seasoned market participant can maximize stock opportunities as they arise. Distributions from a Coverdell ESA are not taxed if they are spent on qualified education expenses. Caution: you are only allowed to contribute $2,000 per year per child. Furthermore, if the money isn't used for qualifying education expenses, it can be taxed -- which defeats the purpose of the Coverdell. But given that the contribution limits are low, while college costs are historically high, it’s unlikely to be an issue.

Use a Roth IRA - From an estate-planning standpoint, a Roth IRA has useful features. You can contribute to it as long as you have earned income, and you're not obligated to withdraw any money for as long as you live, so you can leave your investments to grow for the rest of your life. Your heirs won't have to pay tax on withdrawals so long as the account has been open for at least five years. After your death, your kids can take the proceeds as a tax-free lump sum, or allow the money to grow and compound for years. (They will, however, have to take required minimum distributions (RMDs) from the account beginning in the year you die.) 

How to Handle a Property Line Dispute

Property line disputes between neighbors are common. Sometimes the issue boils down to a simple misunderstanding or mistake and can easily be resolved, but in other instances, homeowners need to get government officials and even attorneys involved.

Gather Information
If you believe that your neighbor’s fence, tree or other structure is encroaching on your property, check official records before you raise the issue with your neighbor. It’s possible that descriptions of the property line on your and your neighbor’s deeds are inconsistent or that a previous owner of your property deeded the piece of land to your neighbor or granted an easement. You might not have found out about it when you bought the house if you didn’t conduct a title search.

If the location of the property line is unclear, a surveyor can figure out exactly where the line lies. If you believe your neighbor is in the wrong, research state and local laws and make sure you fully understand the issue and are on solid legal footing.

Discuss the Matter With Your Neighbor
If you and your neighbor have a good relationship, you can raise the property line issue with a face-to-face conversation. Be civil and don’t use the discussion as an opportunity to vent about unrelated issues. Doing so would only make your neighbor feel attacked, and the conversation would likely turn into a heated argument that would resolve nothing.

If you and your neighbor are both calm and reasonable and you present evidence to back up your claim, you may be able to resolve the issue amicably by yourselves. You could agree to sell the piece of disputed land to your neighbor and file a deed outlining your agreement with the appropriate local government body, or the neighbor could agree to move the structure off your property.

What to Do If You Can’t Resolve the Issue Yourselves
If you and your neighbor are unable to reach an agreement on your own, you can try mediation. Your local police department or courthouse may be able to help you find a mediator with experience handling property line disputes.

If your neighbor is being unreasonable and is unwilling to work with a mediator, you can have your attorney send a letter explaining the property line violation and requesting a specific remedy. Your neighbor may begin to take the issue seriously after receiving the attorney’s letter.

If these measures don’t work, you may have to file a lawsuit. That should be a last resort since lawsuits can be lengthy and expensive and can permanently damage relationships between neighbors.

Try to Work Things out on Your Own
If you have a property line dispute with your neighbor, do your best to resolve it amicably. Gather as much information as possible before raising the issue, and try to find a solution to avoid expensive bills and strained relations.

The Importance of Home Equity

If you’ve owned a home for several years and made responsible financial decisions, you may have built a significant amount of equity. Home equity is the difference between the current market value of your house and the amount you still owe on the mortgage. If the value is greater than the debt, you have positive equity that can be used to finance other goals.

How Does Equity Change Over Time?
There are two ways to increase the amount of equity in your home. First, you can pay down the principal on the mortgage and make improvements that will increase the value of the house. As the ratio of the amount of the house you own outright to the amount of debt increases, equity grows.

It takes years to build equity. One reason for this is that mortgages tend to charge more interest at the beginning of the repayment period, which means a relatively small amount of each payment is applied to the principal. Later in the repayment period, a higher percentage of each monthly payment will pay off the principal, so equity will grow at a faster rate.

Paying a mortgage each month can be a way to force yourself to save and build wealth. Since the value of a house will increase over time in most circumstances, you can amass a significant amount of equity if you stay in your house for several years.

Paying your mortgage on time is no guarantee that you will gain equity. If the local housing market or the economy as a whole takes a nosedive, the value of your house could plummet. You could wind up with less equity than you had before, or you might even wind up owing more than your house is worth.

How to Take Advantage of Equity
You can benefit from your home’s equity when you sell it. If you receive more than the amount of the outstanding mortgage balance, you will be able to pay off the loan and walk away with a profit.

You can also use your home equity while you are living in your house. You can borrow against your equity with a home equity loan, which would provide a lump sum of money, or a home equity line of credit, which would let you borrow money in a variety of amounts over a period of time, up to your credit limit. Both options would provide you with money that could be used for home repairs and improvements, credit card bills, and other expenses.

If you want to find out how much equity you currently have, you can use a home equity calculator to get an estimate. If you want a more exact figure, you will need to have the house appraised.

Focus on Increasing Equity
Home equity takes time to build, but it can give you the financial flexibility you need to pursue other goals. Diligently paying down your mortgage and making valuable home improvements can help you grow your equity faster.

5 Ways to Declutter Your Digital Life

You may declutter your home, but what about your digital space? Many of us spend hours online each day, so you should make your online atmosphere as streamlined as your living room at the end of cleaning day.

Hit "unfollow". There's no reason to have 5,000 Facebook friends or follow 2,000 folks on instagram. Have an "unfollow" spree where you remove users you don't find inspiring or have a direct connection with.

Hit "unsubscribe”. Email account bogged down? Don't just hit 'delete'. Take 10 minutes every morning for one week to hit "unsubscribe" on any newsletters, shopping memos or other online alerts cluttering up your inbox.

Consolidate subscriptions. If you have a dozen or so online subscriptions, like music streaming platforms, content streaming platforms, and more, look into consolidating subscriptions. Several platforms now partner with each other, an obvious way to consolidate. For instance, a Spotify Premium account now comes with access to Hulu, so one subscription offers double access. Consider a family Netflix account instead of an individual plan.

Merge emails. Did you know you can merge multiple email addresses into one account so that all of your mail is accessible in one spot? This is helpful for entrepreneurs, business owners or anyone with two, three, or four separate email addresses.

Purge your hard drive. Go through all of the documents on your computer and look for items you can delete or backup and remove from your machine. This will make space and could even lengthen the lifespan of your machine. 

Here's Why You Should Decorate With Green

Regardless of the shade, adding elements of green to your home can improve your mood, complement your design, and more. Below are a few reasons to choose green for your interior design scheme.

It’s soothing. Green has long been used in decorating for its calming effect. Add some green curtains to your bedroom, paint the wall across from your sleeping space green and snag some easier ahhhhs.

It looks great with wood. If you have wood floors or furniture, tying in a shade of green will make your space even more lustrous.

It’s complimentary. There are so many gorgeous shades of green that it will be easy to thread a little green into your decorating scheme.

It’s natural. Don’t want to add any permanent green to your home? No problem! Just grab a few fresh houseplants and pepper them throughout your room for a fresh splash of green.

It may bring money. While you may not believe in this superstition, some swear that the color green brings wealth. Add some green to your home to call in a little windfall. It can’t hurt!

California housing affordability dips in second quarter 2019, C.A.R. reports

• Thirty percent of California households could afford to purchase the $608,660 median-priced home in the second quarter of 2019, down from 32 percent in first-quarter 2019 but up from 26 percent a year ago. 
• A minimum annual income of $122,960 was needed to make monthly payments of $3,070, including principal, interest and taxes on a 30-year fixed-rate mortgage at a 4.17 percent interest rate.
• Forty percent of home buyers were able to purchase the $475,000 median-priced condo or townhome. An annual income of $95,960 was required to make a monthly payment of $2,400.

LOS ANGELES (Aug. 7) – Higher home prices negated the lowest interest rates in more than a year and reduced Californians’ ability to afford a home purchase in the second quarter of 2019, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in second-quarter 2019 dipped to 30 percent from 32 percent in the first quarter of 2019 but was up from 26 percent in the second quarter a year ago, according to C.A.R.’s Traditional Housing Affordability Index (HAI). California’s housing affordability index hit a peak of 56 percent in the second quarter of 2012.

C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state.

A minimum annual income of $122,960 was needed to qualify for the purchase of a $608,660 statewide median-priced, existing single-family home in the second quarter of 2019. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,070, assuming a 20 percent down payment and an effective composite interest rate of 4.17 percent. The effective composite interest rate was 4.62 percent in first-quarter 2019 and 4.70 percent in second-quarter 2018. 

Housing affordability for condominiums and townhomes also slipped in first-quarter 2019 compared to the previous quarter, with 40 percent of California households earning the minimum income to qualify for the purchase of a $475,000 median-priced condominium/townhome, down from 41 percent in the previous quarter. An annual income of $95,960 was required to make monthly payments of $2,400. Thirty-six percent of households could afford to buy a condominium/townhome a year ago.

Compared with California, more than half of the nation’s households (55 percent) could afford to purchase a $279,600 median-priced home, which required a minimum annual income of $56,480 to make monthly payments of $1,410.

Key points from the second-quarter 2019 Housing Affordability report include:

• When compared to a year ago, housing affordability improved in 42 tracked counties and declined in five counties. Affordability remained flat in one county.
• In the San Francisco Bay Area, affordability improved from second-quarter 2018 in every county. San Francisco County was the least affordable, with just 17 percent of households able to purchase the $1,700,000 median-priced home. Forty-six percent of Solano County households could afford the $445,000 median-priced home, making it the most affordable Bay Area county.
• Affordability also improved in all Southern California regions, with Orange County being the least affordable (24 percent) and San Bernardino County being the most affordable (50 percent).
• In the Central Valley region, only Kern County experienced a decline in affordability from a year ago, decreasing from 53 percent in second-quarter 2018 to 50 percent in second-quarter 2019. San Benito County (35 percent) was the least affordable and Kings County (55 percent) was the most affordable.
• Housing affordability improved in three counties in the Central Coast region — Monterey, San Luis Obispo and Santa Cruz — and was unchanged in one, Santa Barbara.
• During the second quarter of 2019, the most affordable counties in California were Lassen (63 percent), Kings (55 percent) and Madera (51 percent). The minimum annual income needed to qualify for a home in these counties was less than $60,000.
• Mono (15 percent), San Francisco (17 percent), Santa Cruz (17 percent) and San Mateo (18 percent) counties were the least affordable areas in the state. San Francisco and San Mateo counties required the highest minimum qualifying incomes in the state. An annual income of $343,420 was needed to purchase a home in San Francisco County, and an annual income of $338,870 was required in San Mateo County.

See C.A.R.’s historical housing affordability data.See first-time buyer housing affordability data.

Leading the way in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with more than 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

CALIFORNIA ASSOCIATION OF REALTORS®

Traditional Housing Affordability Index

Second quarter 2019

STATE/REGION/COUNTY	2nd Qtr. 2019	1st Qtr. 2019		2nd Qtr. 2018		Median Home Price	Monthly Payment Including Taxes & Insurance	Minimum Qualifying Income
Calif. Single-family home	30	32		26		$608,660	$3,070	$122,960
Calif. Condo/Townhome	40	41		36		$475,000	$2,400	$95,960
Los Angeles Metro Area	32	33		29		$540,000	$2,730	$109,090
Inland Empire	42	42		41		$380,000	$1,920	$76,760
San Francisco Bay Area	24	26		18		$980,000	$4,950	$197,970
United States	55	57		53		$279,600	$1,410	$56,480
San Francisco Bay Area
Alameda	23	25		16		$950,000	$4,800	$191,910
Contra Costa	35	37		29		$690,000	$3,480	$139,390
Marin	21	21		18		$1,381,250	$6,980	$279,030
Napa	28	29		25		$710,000	$3,590	$143,430
San Francisco	17	17		14		$1,700,000	$8,580	$343,420
San Mateo	18	18		14		$1,677,500	$8,470	$338,870
Santa Clara	20	20		16		$1,330,000	$6,720	$268,680
Solano	46	46		38		$445,000	$2,250	$89,900
Sonoma	28	27		20		$660,000	$3,330	$133,330
Southern California
Los Angeles	29	28		26		$567,010	$2,860	$114,540
Orange	24	24		20		$835,000	$4,220	$168,680
Riverside	39	39		37		$420,000	$2,120	$84,840
San Bernardino	50	50		49		$310,000	$1,570	$62,620
San Diego	27	27		23		$655,000	$3,310	$132,320
Ventura	30	29		28		$650,000	$3,280	$131,300
Central Coast
Monterey	24	25		19		$630,000	$3,180	$127,270
San Luis Obispo	25	26		22		$640,000	$3,230	$129,290
Santa Barbara	20	25		20		$724,500	$3,660	$146,360
Santa Cruz	17	17		12		$937,500	$4,740	$189,390
Central Valley
Fresno	48	48		46		$279,920	$1,410	$56,550
Kern	50	50		53		$255,000	$1,290	$51,510
Kings	55	57		50		$250,000	$1,260	$50,500
Madera	51	52		48		$277,000	$1,400	$55,960
Merced	47	46		42		$282,000	$1,420	$56,970
Placer	45	46		41		$514,950	$2,600	$104,030
Sacramento	44	44		41		$385,000	$1,940	$77,770
San Benito	35	31		30		$571,500	$2,880	$115,330
San Joaquin	44	43		38		$380,000	$1,920	$76,760
Stanislaus	48	47		45		$325,250	$1,640	$65,700
Tulare	50	51		48		$247,500	$1,250	$50,000
Other Calif. Counties
Amador	NA	NA		44		NA	NA	NA
Butte	35	34		38		$370,000	$1,870	$74,740
Calaveras	46	47		43		$343,000	$1,730	$69,290
El Dorado	40	40		38		$519,500	$2,620	$104,940
Humboldt	37	36		33		$320,000	$1,610	$64,570
Lake	44	44		37		$267,000	$1,350	$53,820
Lassen	63	63		64		$204,000	$1,030	$41,080
Mariposa	45	41		39		$300,000	$1,510	$60,350
Mendocino	29	28		22		$400,000	$2,010	$80,380
Mono	15	10		14		$699,500	$3,510	$140,410
Nevada	40	40		32		$419,000	$2,100	$84,020
Plumas	37	48		42		$367,390	$1,840	$73,600
Shasta	47	44		46		$281,000	$1,410	$56,230
Siskiyou	49	53		48		$232,500	$1,160	$46,480
Sutter	46	46		45		$312,500	$1,560	$62,400
Tehama	47	43		51		$244,000	$1,220	$48,680
Tuolumne	48	45		43		$300,000	$1,490	$59,790
Yolo	40	39		33		$455,000	$2,260	$90,590
Yuba	46	46		45		$305,000	$1,520	$60,660