Archive for the ‘Homeowner’ Category

HOMEOWNERS TAKE A TIP FROM CONDO ASSOCIATIONS
July 30, 2016

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Many people enjoy single family homes that are not under the rules and regulations of an association.  However, there are some association practices that would benefit the average homeowner.  Every year the association prepares a budget for the upcoming year.  This is the basis of the Homeowners Association (HOA) dues.  As one would expect, the budget projects the costs for repairs and maintenance of the complex for the next twelve months.  But it contains something more.

A number of years ago, when HOAs faced expensive replacement costs, homeowners would be hit with a special assessment that needed to be paid immediately.  This practice created a heavy burden on many and California began requiring the associations to prepare reserve studies every three years.  From those studies, a portion of the dues is now earmarked for a reserve account.  So when the roof needs to be replaced, the pool resurfaced, or private streets repaved, the funds are already in a reserve account.

A homeowner can create a similar study.  First, make a list of major replacement projects that must be done every several years. Assign the useful life left on each project and the cost of doing that project today.  The annual reserve amount for a project is determined by dividing the cost by the useful life.  When a project is done, it gets added back to the list with a new useful life.  Costs should be updated every few years.

Project Remaining Useful Life (in years)  Cost  Annual Reserve (Cost/Life)
Paint exterior 3     5,000  $   1,667
Replace roof 15   15,000       1,000
Resurface pool 7     8,000       1,143
Replace water heater 4     1,200          300
Total Annual Reserves  $   4,110
Monthly Reserve  $      342

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TOP TEN WAYS TO LOWER THE VALUE OF YOUR NEIGHBORHOOD!
November 14, 2015

(or How to make it difficult for your neighbor to sell his home)abandoned_house_royalty_free_080916-026182-569042

  1. Don’t mow the grass or water it.  Two foot high dead weeds are always a neighborhood downer.
  2. Let juniper hedges and ivy overgrow the public sidewalks.  This will keep nosy people from walking past your house while giving rats a nice place to live.
  3. Park all your cars and other vehicles on the street.  Come on – you need your garage to store your beer can collection and the driveway is for your skateboard ramp.
  4. Have your dog bark incessantly – day and night.  Better yet – let him go on a morning romp through the neighborhood sans leash, of course.
  5. Turn up the volume on your music and TV especially when suffering from insomnia.  If you can’t sleep, why should anyone else?
  6. Don’t clean your pool.  Mosquitoes are a great way to scare away pesky humans.
  7. Why replace your wood shake roof just because it’s leaking.  After all, isn’t that what pots and pans are for?
  8. Don’t paint your house, fix broken windows, replace the banged up garage door, take down holiday decorations, or bring in the trash cans.  Who in their right mind would want to buy a house in close proximity to yours?
  9. Don’t replace the almost non-existent asphalt driveway as your neighbors have.  Use the money instead as a down payment on a four-wheel drive vehicle for those rainy days when the mud makes it difficult to get to your front door.
  10. Never smile or have a kind word for potential neighborhood buyers.  Let’s face it – no one’s Dream Home includes surly neighbors.

Just remember these actions can come back to bite you.  If you should need to refinance, take out an equity line, or sell your home, your value will be based on neighborhood sales during the past few months.  If your actions or neglect caused prior sellers to have to accept lower values for their homes, that will lower the value of your property as well.

Rich & Jan McMillen
www.TOHomes.com

WATER HEATERS TARGETED BY THE DEPARTMENT OF ENERGY
March 21, 2015

Water Heater 1Effective April 16, 2015, higher energy factor ratings will be required by the National Appliance Energy Conservation Act (NAECA) on virtually all residential gas, electric, oil and tankless water heaters.

For homeowners, these changes will ultimately result in a better, more efficient product with lower operating costs, but the upgrades come with some cost. Changing the capacity and insulation factor of the water heater increases overall size of the unit. If your water heater is installed in a tight space now, there is a good chance that the new models will not just slide into place. This might mean relocating the water heater to a new location or retrofitting the current space to accommodate the upgraded model. Upgrading the venting to the new standards also affects replacement; expect increased installation times to adapt current venting to new EF requirements. The addition of the new electronics could result in increased maintenance costs due to increased complexity of design. Expect a few extra visits to fine-tune the water heater for optimum performance and possibly working out the bugs in new technologies.

When products become more complex, it is less likely that they will be purchased and installed by the do-it-yourself consumer. Also, some homeowners may now take notice of tankless technology as it already incorporates the demands of the new NAECA guidelines. The units are wall-hung, meaning that they will readily fit into tight spaces that cannot accommodate the new and larger tank water heaters.

 Rich and Jan McMillen
www.TOHomes.com/

HOME IMPROVEMENTS FOR 2015
March 16, 2015

• Small changes can make a big difference. Tour your home and make a punch list of all the little items needing repaired (e.g. broken or missing faceplates on outlets and switches) or could be updated (e.g. changing the outdated color of the family room or ratty towels in the guest bathroom). Then, start tackling them one at a time. You’ll feel a sense of pride when finishing each task and you’ll also feel better about your refreshed home.
• Make a major improvement. Remember a home should always be a work in process so update the kitchen countertops, change out that nasty shower stall, replace those 40-year-old cloudy windows with energy-efficient dual-pane ones, or add central air conditioning . If not now, when?
• Surprise by design. Change you child’s nursery to reflect the princess she has become or the superhero he wishes to be!
• Stop and smell the roses or some other flowery delight. Plants and flowers are known mood lifters. Attractive landscaping is key for adding curb appeal to your home and is a gift to your neighbors too. Bring nature inside as well to improve air quality and to treat yourself to spring all year long.
• Light up your home. Update light fixtures starting with outdated chandeliers in the entry and dining room. Install recessed lighting in living rooms, family rooms and kitchens to increase your home’s value.
• Reclaim your garage. Jerry Seinfeld quipped that once items move to the garage, they never make it back into the house. So take some time to decide between donating that old couch to an organization that could make good use of it or sending it to the landfill.
• Learn a new skill. YouTube videos can teach you how to lay tile in a bathroom and install a closet organizer in a home office. A well done Do It Yourself project will bond you to your home.
• Rekindle the romance with your home. Your most valuable asset and the place you spend the majority of your time is probably your home. Treat it with love.

Paint

Rich and Jan McMillen
www.TOHomes.com

THINK TWICE ABOUT ATTIC AND RAFTERS STORAGE!
October 30, 2011

A man in Michigan is suing his in-laws because he fell through their attic helping them retrieve Christmas decorations.  So we are using this opportunity to remind everyone most attics are built for one purpose – to hold up the roof.  The rafters and trusses are designed to support the weight of the roofing material.  They are not normally engineered for the weight of stored items.  Stressing the trusses, rafters, and joints beyond the structural integrity they were designed for can cause damage and ultimately failure of the roofing system.

Unfortunately, many people think that the attic and the rafters in the garage are great places to store stuff.   They often lay wood flooring in the attic and will install a ladder to create permanent storage space unconcerned with the weight of the items they store.  We have seen boxes of books and paper records, furniture and more stuffed into these spaces.

To compound the problem, homeowners often wish to promote an attic storage area as a feature of the house when they list it for sale. They don’t understand the potential future liability of promoting this illegal storage space in the event that the trusses are structurally compromised later by the unwitting buyer.

We recommend homeowners not to utilize their attics for storage; and when selling their home, never advertise it for that use.

Rich and Jan McMillen
www.TOHomes.com
 

USERS, MAINTAINERS, IMPROVERS – OH, MY!
September 5, 2011

After viewing thousands of homes over the years, we have noticed that there are three basic types of homeowners: Users, Maintainers, and Improvers.  You know them; you see them; they live in your neighborhood.  Some times they live in the same house together.

The User tends to defer maintenance as long as possible.  Problems are addressed only when they reach the threshold of being difficult to live with.  Even then, a bare minimum or a patch repair will be done.  Holes in walls and leaky faucets are likely to go unnoticed.

However, when a door knob on the double front-entry doors is no longer functional, the User will replace it, but it may not match the rest of the hardware. There may be evidence for months that the water heater is not working properly, but until there is no hot water in the morning shower, it is of minimal concern to the User.  Once the problem needs to be addressed, a permit will probably not be pulled, and the installation may not be to current code.

Over time, a User’s home becomes the “fixer”.

A Maintainer repairs problems immediately.  If a light burns out; he will immediately put in a new bulb.  If a door knob is loose, he will tighten it.  If it needs to be replaced, he will make sure that all the hardware matches.  If a tile gets cracked, and a replacement would be too noticeable, he would redo the whole counter or floor.  Maintainers often strive for energy efficiency so they may do a straight swap of single-pane windows with newer dual-pane ones.

If the original cabinets are starting to show too much wear, these may get a new face or even replaced.  However, the results are rarely above current builders’ standards.

Though a Maintainer’s home shows “pride of ownership”, he is often disappointed when buyers don’t show the same enthusiasm for his choices and don’t make the same offers they do on an Improver’s home.

The Improver is every REALTOR’s® dream.  Compared to new construction, hers is the home with the builder’s upgrades.  An Improver told us once that the interior and exterior of a home should be changed at least every twenty years to keep it at current standards and styles.  She does a project every year.  Sometimes it is just one room, such as the kitchen or the family room, and sometimes it a more encompassing endeavor.

One such project entailed having the acoustic ceilings removed.  She did it for the more contemporary look; but she had to pay more since they tested positive for higher levels of asbestos.  Despite the extra cost, she said it was worth it.  Often Improvers know that they will not get dollar for dollar out of all their improvements, but they do it for the pleasure equity.

An Improver goes the extra emotional step when tackling a project.  Instead of just replacing new windows for old, the living room may get a bay window or a picture window while the kitchen will be brightened by a garden window.  French doors replace original sliding doors.  Their curb appeal is given an extra boost when the cracked driveway is replaced with stamped concrete or pavers.  They are not content to just paint a room; they add crown molding.

An Improver’s home is usually the one with the “WOW” factor.

Rich and Jan McMillen
 
www.TOHomes.com

SO YOU THINK YOUR HOME IS IN A TRUST
September 1, 2011

 Many homeowners have their homes in their trust for tax and legal purposes or to avoid probate.  However, when refinancing a home, a lender will usually require the property to be taken out of the trust and put back into the owner’s name so the owner will be responsible for the loan, not the trust.

 This is well and good, but homeowners often forget to put the property back into the trust once the refinance is complete.  This can cause huge legal and tax consequences!

 Recently we sold a home that had been in a trust until the owner decided to take advantage of low-interest rates and refinance.  At that time, she signed in front of a notary a quit claim deed taking the property out of the trust and another one putting it back in.  The former was recorded with the trust deed and the latter was put aside until that transaction was finished.  Unfortunately, it was filed away with all her other paperwork.

 Sadly, a few months later, she died.  The heirs were also the subsequent co-trustees of the trust which they believed was properly in place.  They put the home on the market and very quickly a buyer was found and escrow was opened.  Everything was going smoothly, getting past the buyers’ physical inspection of the home and their loan process.  Then the call came from the title insurance company – no deed was ever recorded with the county putting the property back in the trust!

 Before considering the alternative, probate, the heirs decided to search their mother’s paperwork hoping that there was a non-recorded deed somewhere.  With the help of friends, they went through boxes upon boxes taken from their mother’s home.  Finally they located the paperwork refinancing the home, and in that stack, they found an unrecorded notarized deed! Subsequently, it was recorded to officially put the house back into the trust.  There was an extra step or two required by the title insurance company, but the transaction closed soon after.  The sellers were happy and the new owners thrilled.

 We recommend that homeowners seek legal and tax advice from an attorney and/or an accountant regarding the method of taking title to real estate.  If you do put your home in a trust and then refinance, make sure that the deed putting your home back into the trust is then recorded.

 

Rich &Jan McMillen

 

www.TOHomes.com

 

TOP TEN PHYSICAL INSPECTION ITEMS
August 30, 2011

Selling a home can have a lot of emotional ups and downs.  That roller coaster ride does not end with a signed contract.  Sellers have been known to lose their lunch on the Physical Inspection Plunge.  Safety issues will usually be recapped in a report and these are especially of concern to buyers.

Following are ten common problems discovered during the physical inspection:

  1. Furnace – Flex gas line entering furnace is not to code as it can break during an earthquake
  2. Electrical – GCFI missing in kitchen, bathroom, garage, or outside; outlets not properly grounded or polarities reversed; wiring that is not up to code (e.g. added garage lighting and automatic garage door openers); open junction boxes (often found in the attic)
  3. Water Heater – not properly strapped, anchored and braced; pressure valve release not exiting to exterior.
  4. Fireplace – cracks in fire box or chimney; gas fireplace missing a damper clamp; spark arrestor missing on chimney.
  5. Dishwasher missing air gap. 
  6. Smoke detectors missing or non-functioning.  There is no carbon monoxide detector (now required). 
  7. Windows and doors do not open, close and lock easily.
  8.  If there is a pool or spa, the gates to yard are not self-closing. 
  9. The door to garage is not fire-rated and self-closing. 
  10. Holes are in firewalls between garage and house.

Since these are safety issues, owners should keep themselves safe and not wait until their home is on the market to address them.  Protect yourself today!

 
Rich & Jan McMillen
 
www.TOHomes.com