Buyer

Homeowners Associations: A Double-Edged Sword

Homeowners Associations: A Double-Edged Sword

Homeowners Associations (HOAs) are increasing in the United States, shaping the landscapes of many neighborhoods. They are the most popular in Florida, California and Colorado, where over 60% of properties are part of HOA. In Wisconsin, it’s just about 19%.

HOAs offer a unique blend of benefits and drawbacks, making it essential for potential homeowners to understand their implications.

A Brief History of HOAs

The concept of HOAs traces its roots back to the early 20th century, emerging as a response to urban sprawl and the need for community governance. Initially, HOAs primarily focused on maintaining property values and ensuring aesthetic uniformity within neighborhoods. However, over time, their role has expanded to encompass a wider range of responsibilities, including:

  • Community Maintenance: HOAs often oversee the upkeep of common areas like parks, pools, and landscaping. With this, they take over for the owners chores like lawn mowing and snow removal.
  • Enforcing Rules and Regulations: They establish guidelines regarding property maintenance, architectural styles (often regulating details like color of siding, type and height of a fence etc.), and even noise levels.
  • Providing Amenities: Some HOAs offer additional amenities such as clubhouses, fitness centers, or security services.

The Cost of Belonging

One of the most significant considerations for potential homeowners is the financial impact of HOA fees. These fees vary widely depending on the specific HOA, location, and the level of services provided. On average, HOA fees can range from a few hundred dollars to several thousand dollars per year. Not surprisingly, the highest HOA membership fees are paid by home owners in Alabama, on average almost 5,500/year, with Wisconsin average being “only” $4,000/year on average.

While HOA fees may seem burdensome, it’s important to weigh the costs against the benefits. By maintaining property values and providing amenities, HOAs can contribute to a more desirable living environment. However, it’s crucial to carefully review the HOA’s budget and financial history to ensure that fees are being used responsibly.

The Pros and Cons of HOA Living

Pros:

  • Enhanced Property Values: HOAs can help maintain property values by enforcing consistent standards and investing in community improvements.
  • Community Amenities: HOAs often provide access to shared amenities like pools, fitness centers, and clubhouses.
  • Security: Some HOAs offer security services, such as gated communities or 24/7 surveillance.
  • Sense of Community: HOAs can foster a strong sense of community through social events and volunteer opportunities.

Cons:

  • Strict Rules and Regulations: HOAs may impose restrictive rules on homeowners, limiting their freedom to modify their properties.
  • Increased Costs: HOA fees can add to monthly expenses and may increase over time.
  • Potential for Conflict: Disagreements between homeowners and the HOA board can arise, leading to tension and legal disputes.
  • Lack of Privacy: In some cases, HOAs may have the authority to monitor residents’ activities.

Making an Informed Decision

When considering a home within an HOA community, it’s essential to conduct thorough research and ask the right questions:

  • Review the HOA’s Governing Documents: Understand the rules, regulations, and financial obligations.
  • Inquire About Fee Structure: Learn about the current fees and any potential increases.
  • Assess the HOA’s Financial Health: Review the budget and reserve funds to ensure long-term sustainability.
  • Attend HOA Meetings: Participate in meetings to gain insights into the board’s decision-making process.
  • Talk to Current Residents: Get firsthand accounts of the HOA’s strengths and weaknesses.

By carefully evaluating the pros and cons, potential homeowners can make informed decisions about whether HOA living is the right choice for their lifestyle and financial situation.

Buyer

All about home inspection

The Importance of a Home Inspection

Buying a home is a significant investment, and a home inspection is a crucial step in the process. It provides valuable insights into the property’s condition and potential issues, helping you make informed decisions about your purchase.

Why a Home Inspection Matters

  1. Identifying Structural and Safety Concerns: A home inspector will thoroughly examine the property’s foundation, framing, roof, electrical system, plumbing, and heating/cooling systems. They can identify potential structural weaknesses, safety hazards, and code violations that may not be visible to the untrained eye.
  2. Assessing the Overall Condition: The inspector will evaluate the general condition of the property, including the interior and exterior finishes, appliances, and overall maintenance. This information helps you understand the property’s age, wear and tear, and any necessary repairs.
  3. Budgeting for Repairs and Maintenance: Knowing the property’s condition allows you to budget for potential repairs and maintenance costs. This helps you avoid unexpected expenses after closing.
  4. Negotiating Power: If the inspection reveals significant issues, you can use this information to negotiate a lower purchase price or ask the seller to make repairs before closing.
  5. Peace of Mind: A thorough home inspection can provide you with peace of mind knowing that you’re making an informed decision about your investment.

What Does a Home Inspection Typically Cover?

A standard home inspection typically covers the following areas:

  • Foundation: Checks for cracks, water damage, and other structural issues.
  • Roof: Assesses the roof’s condition, including any leaks, missing shingles, or other damage.
  • Plumbing: Evaluates the plumbing system for leaks, water pressure issues, and the condition of pipes and fixtures.
  • Electrical System: Tests the electrical system, including outlets, switches, and wiring.
  • Heating and Cooling System: Checks the condition of the HVAC system, including the furnace, air conditioner, and duct work.
  • Attic and Crawl Space: Inspects the attic and crawl space for insulation, ventilation, and signs of pests or water damage.
  • Interior: Assesses the condition of walls, floors, ceilings, and cabinets.

How Much Does a Home Inspection Cost?

The cost of a home inspection varies depending on several factors, including:

  • Size of the Home: Larger homes typically require more time to inspect, which can increase the cost.
  • Age of the Home: Older homes may have more potential issues, which can also increase the cost.
  • Location: Home inspection costs can vary by region.
  • Inspector’s Experience: More experienced inspectors may charge higher rates.
  • Specific Services Included: Some inspectors offer additional services, such as radon testing or mold inspection, which can add to the cost.

Typically, you can expect to pay between $300 and $500 for a home inspection. However, some inspections may cost more, especially for larger or more complex properties.

Who Pays for the Home Inspection?

Traditionally, the buyer is responsible for paying for a professional home inspection. However, there are some exceptions and nuances to consider.

  • Buyer Pays: In most cases, the buyer assumes the cost of the home inspection to ensure the property’s condition before purchasing.
  • Seller Pays: Sometimes, sellers may offer to pay for a home inspection as an incentive to attract buyers, especially if the home has been on the market for a while or has known issues.
  • Negotiation: The cost of the home inspection can sometimes become a negotiation point during the offer process. Buyers may include the cost of the inspection as part of their offer, and sellers may agree to pay for it or negotiate a lower price.

How to Schedule a Home Inspection

Once you’ve found a home you’re interested in, you can schedule a home inspection with a certified inspector. Be sure to choose an inspector who is licensed and insured.

When scheduling the inspection, you’ll need to provide the inspector with the following information:

  • Property Address: The inspector will need to know the address of the property to be inspected.
  • Access to the Property: The inspector will need access to all areas of the property, including the attic, crawl space, and basement.
  • Any Known Issues: If you’re aware of any existing problems with the property, be sure to let the inspector know.

What to Do After the Inspection

After the inspection, you’ll receive a detailed report outlining the inspector’s findings. The report will include any potential issues and recommendations for repairs.

If the inspection reveals significant problems, you may want to negotiate a lower purchase price or ask the seller to make repairs before closing. You may also want to get quotes from contractors to determine the cost of repairs.

Conclusion

A home inspection is an essential part of the home buying process. By investing in a home inspection, you can protect yourself from costly repairs and ensure that you’re making a sound investment.

Additional Tips for Home Buyers

  • Do Your Research: Before you start looking at homes, do your research and learn about the different types of home inspections available.
  • Get Multiple Quotes: Get quotes from several different inspectors to compare prices and services.
  • Be Present During the Inspection: If possible, be present during the inspection (and ask your agent to accompany you) so you can ask questions and learn more about the condition of the home.
  • Don’t Be Afraid to Ask Questions: If you have any questions about the inspection process or the inspector’s findings, don’t be afraid to ask.

By following these tips, you can ensure that you’re making an informed decision about your home purchase.

Buyer

Navigating Wisconsin’s New Real Estate Landscape

Real estate market has recently undergone significant changes, impacting the home-buying process. Here’s a breakdown of the key updates as they relate to Wisconsin real estate transactions that you need to be aware of.

Mandatory Written Documents

Before viewing a property, buyers in Wisconsin are now required to sign one of three written documents:

  1. Agency Agreement: This agreement establishes a formal relationship between the buyer and their real estate agent, outlining the agent’s fees as well as their duties and responsibilities.
  2. Disclosure to Customers: This document provides information about the agent’s limited duties with no agency agreement. Agent does not represent buyer in the transaction, they only fill out contract per buyers instruction and cannot provide any advise.
  3. Pre-Agency Showing Agreement: This agreement is used when a buyer is considering working with an agent but hasn’t yet made a final decision. Agent cannot provide advise or fill out contract until buyer decides if he wants to work with agent.

Buyer Responsibility for Agent Commission

It’s important to understand that buyers are responsible for paying their real estate agent’s commission. However, buyers can request sellers to provide a credit towards the cost of their agent commission. This is known as a seller concession and can be negotiated during the offer process, along with purchase price and other terms.

Conclusion

Navigating the Wisconsin real estate market can be exciting but also challenging. With the recent changes to the home-buying process, it’s more important than ever to have a knowledgeable and experienced real estate team by your side.

The Korwels Team is here to help you every step of the way. Our team of dedicated professionals can provide expert guidance, negotiate on your behalf, and ensure a smooth home-buying experience.

Ready to get started?

Contact The Korwels Team today to schedule a consultation and learn how we can help you find your dream home in Wisconsin.

Buyer

Pre-qualified or pre-approved?

Which one when?

When embarking on the journey of purchasing a home, understanding the distinctions between pre-qualification and pre-approval is crucial. These two terms often get used interchangeably, but they represent different stages in the homebuying process – and different levels of scrutiny. Let’s delve into the details to help you make informed decisions.

Pre-Qualification: The Initial Step

Pre-qualification is a preliminary assessment that provides a rough estimate of the loan amount you might be eligible for. It’s a relatively informal process that typically involves a brief conversation with a lender or completing an online questionnaire. Lenders will generally ask about your income, debt, and credit history to get a sense of your financial situation.

Key Points About Pre-Qualification:

  • Informal assessment: Doesn’t involve a thorough credit check.
  • Estimate: Provides a general idea of your borrowing capacity.
  • Early stage: Often a starting point in the homebuying process.
  • No commitment: Doesn’t guarantee loan approval.

Benefits of Pre-Qualification:

  • Helps set a budget: Gives you a better understanding of your price range.
  • Streamlines the process: Can expedite the homebuying journey.
  • Enhances your negotiating position: Shows sellers you’re a serious buyer.

Pre-Approval: A More Formal Commitment

Pre-approval is a more rigorous process that involves a comprehensive review of your financial information, including a credit check. It’s a stronger indication of your creditworthiness and ability to secure a loan. Lenders will typically require documentation such as tax returns, pay stubs, and bank statements.

Key Points About Pre-Approval:

  • Formal process: Involves a thorough credit check.
  • Conditional approval: Subject to the property appraisal and verification of income.
  • Stronger commitment: Shows sellers you’re a serious buyer with financing in place.
  • Rate lock option: May allow you to lock in an interest rate for a specific period.

Benefits of Pre-Approval:

  • Increases your chances of success: Demonstrates to sellers that you’re a qualified buyer.
  • Streamlines the closing process: Can expedite the transaction.
  • May offer better interest rates: Lenders may provide more favorable terms to pre-approved buyers.

When to Get Pre-Qualified and Pre-Approved

Pre-Qualification:

  • Early in the homebuying process: If you’re just starting to explore your options.
  • To get a sense of your budget: Before starting your home search.

Pre-Approval:

  • When you’re ready to make an offer: To demonstrate your financial capability to sellers.
  • To lock in an interest rate: If you’re concerned about rising interest rates.

Factors Affecting Pre-Qualification and Pre-Approval

Several factors can influence your pre-qualification and pre-approval status, including:

  • Credit score: A higher credit score generally leads to better terms.
  • Debt-to-income ratio: A lower debt-to-income ratio improves your chances of approval.
  • Income: Higher income can increase your borrowing capacity.
  • Employment stability: A steady job history is beneficial.
  • Down payment: A larger down payment can reduce your loan amount and improve your chances of approval.

Choosing the Right Lender

Selecting the right lender is crucial to the pre-qualification and pre-approval process. Consider the following factors when making your decision:

  • Reputation: Choose a reputable lender with a track record of customer satisfaction.
  • Rates and fees: Compare interest rates and closing costs from different lenders.
  • Terms and conditions: Understand the loan terms and any associated fees.
  • Customer service: Look for a lender that provides excellent customer support.

Additional Tips

  • Start early: Begin the pre-qualification or pre-approval process well before you start your home search.
  • Get organized: Gather all necessary documentation, such as tax returns, pay stubs, and bank statements.
  • Shop around: Compare offers from multiple lenders to find the best terms.
  • Be transparent: Provide accurate information to your lender to avoid delays.
  • Consider a pre-approval lock: If you’re concerned about rising interest rates, consider locking in your rate.

By understanding the differences between pre-qualification and pre-approval, you can make informed decisions and increase your chances of successfully purchasing a home. Remember, these are essential steps in the homebuying process, so take the time to research and choose the best options for your specific needs.

Contact us today if you have additional questions – we can also suggest some local lenders we work with and trust to guide you through the process.

Buyer

Tips for Unmarried Couples Buying a House

For unmarried couples, the excitement of buying a home can be tinged with a bit of uncertainty. Fear not! With some careful planning and knowledge , you can navigate the process smoothly and build a secure nest together.

Understanding Title Ownership: You Say Yours, I Say Ours

One of the key differences unmarried couples face compared to married couples is the lack of automatic legal protections. This is especially true when it comes to ownership of the property. Here, you’ll need to decide how you want to hold the title, essentially determining how you own the house:

  • Joint Tenancy with Right of Survivorship: This is the simplest option. Both partners own the property equally, and if one partner passes away, the other automatically inherits their share. This avoids probate, a lengthy and costly legal process that determines how assets are distributed after death. Sounds perfect, right? Well, it’s important to understand that both partners have equal rights to the property, meaning either can sell their share without the other’s consent.
  • Tenancy in Common: This option offers more flexibility. Each partner can own a different percentage of the property, based on their down payment contribution, for example. You can also designate who inherits your share upon death through a will. This might be useful if one partner contributes significantly more financially. However, tenancy in common does not include the right of survivorship. If one partner dies without a will, their share may go to their legal heirs, which could potentially be someone other than your partner.

Choosing the Right Title:

Deciding how to hold title depends on your specific circumstances and long-term goals. Here are some factors to consider:

  • Financial Contribution: Did one partner contribute a larger down payment? Tenancy in Common allows you to reflect that contribution in ownership percentages.
  • Future Plans: Do you plan to have children or get married in the future? Joint tenancy with right of survivorship might be simpler, but discuss how future life changes could impact your decision.

Remember, this is a crucial decision. Consulting with a local real estate attorney is highly recommended. They can explain the legal implications of each option within the context of your state’s laws and help you choose the title structure that best suits your needs.

The Mortgage Maze: Two Hearts, One (or Two) Mortgages?

Getting pre-approved for a mortgage is an essential first step in the home-buying journey. However, as an unmarried couple, there are some additional things to keep in mind:

  • Joint Mortgage Eligibility: Both your credit scores, income, and debt-to-income ratios will be considered to determine your borrowing power.
    • Credit Scores: The lower of your two credit scores will often affect the loan terms you qualify for, including the interest rate. Discussing credit improvement strategies and working towards a healthier credit score together can be beneficial.
    • Income Verification: Combined income determines the maximum loan amount you can qualify for.
    • Debt-to-Income Ratio: This ratio shows the lender how much debt you carry compared to your income. A lower ratio (typically below 36%) indicates a better ability to manage mortgage payments.
  • Applying for a Mortgage as Unmarried Partners: Be transparent with the lender about your relationship status. This could affect the loan agreement. Have all necessary documents ready, such as proof of income, employment verification, and identification for both partners.

Beyond the Bricks and Mortar: Protecting Your Nest Egg

While love is the foundation of any relationship, legal agreements can provide much-needed peace of mind. Consider these two options:

  • Cohabitation Agreement: This outlines who owns what assets and how finances will be handled if the relationship ends. It can address things like furniture, appliances, and even shared bank accounts.
  • Property Agreement: Similar to a prenuptial agreement, this specifies each partner’s financial contribution to the property and how it should be divided upon separation or death. This can be particularly important if one partner contributes significantly more financially towards the down payment or renovations.

These agreements can prevent disagreements and potential legal battles down the road. Remember, a real estate attorney can help draft these documents properly to ensure they are legally binding.

This post has explored the key considerations for unmarried couples buying a house, from understanding title ownership and navigating the mortgage process to implementing legal protections like cohabitation agreements and property agreements. Remember, seeking guidance from a real estate attorney is invaluable throughout the journey.

So, are you ready to turn your dream of homeownership into a reality? Contact us today! We can help you navigate the process from start to finish, ensuring a smooth and stress-free experience. Let’s build your dream home together, on a foundation of love, planning, and legal security.

Buyer

4 tips to moving with pets

I mentioned before we moved several times in a short period of time. Our two cats moved with us. It was never easy on us, but it was even harder on them – cats are creatures of habits. Dogs also do not take well to long trip and commotion of the move. Here are four tips we tested over the years, hopefully they will help you – and your pet.

  1. Pack and clean one room in old home first, for example spare bedroom. Keep you pets, in their crates, with favorite toy, in this room. This way they will be in relative quiet. Other options, for more anxious pets, is to have them stay with a friend or even board your pet for a packing day.
  2. Pack a set of basic pet supplies: pet food, favorite bowl, water bowl or fountain, litter box and litter for cats, leash for dogs, couple of favorite toys. Keep it handy with you in your car, make it easy to reach the stash when you arrive on site so you can unpack and set up spot for your pet in your new home.
  3. It goes without saying, but have your pets travel with you in the car. I strongly recommend having any pet in crate, to avoid distractions while driving. Additionally, have the crate facing you and so your pet is able to listen conversation or just be aware of your presence during the trip. Some pets might prefer to have crate covered with blanket. Remember about securing the crate with seat belts.
  4. When in new location, set your pet up in one quiet room while you unpack. Keep it there for a day or two, and get accustomed to a new place. I suggest setting up your bedroom, if your pet is allowed to sleep with you, then your presence at night will also help ease them.

Do you have any of you tested any tips or tricks to make it easier for your pets to get through move? Share them in comments below.

Buyer

Tax benefits of owning your home

Tax benefits of owning your home

Oceans of paper have been filled with dissertations whether it is more beneficial to rent vs. own your home. You can read our own take on it here… One thing that very few sources mention are potential tax benefits* of owning your home. In some cases they can tip the scale substantially towards the ownership side.

How can owning a house save you money?

1. Mortgage interest

Chances are that you have a mortgage on your house. And at the end of each year you’re receiving a form from your financial institution detailing how much interest you’ve paid over the course of the year. Save that form. Interest paid on mortgage used to finance your primary residence is tax deductible. But you probably knew that. Mortgage interest deduction is one of the most common ones claimed by tax payers.

2. Property tax deduction

You may deduct up to $10,000 ($5,000 if married filing separately) for a combination of property taxes and either state and local income taxes or sales taxes.

You might be able to deduct property and real estate taxes you pay on your:

  • Primary home
  • Co-op apartment
  • Vacation homes
  • Land

3. Home office deduction

Do you run small business out of your home? Is that space used exclusively for business? If yes the IRS allows you to deduct utilities, real estate taxes, repairs, maintenance and other related expenses. The details of this deduction are too complex to list it in this post, but the simplest way is to claim standard deduction of $5 per square foot (up to $1,500) of the space dedicated as office use.

4. Energy efficiency updates and credits

As a homeowners can claim a federal tax credit for making certain improvements to their homes or installing appliances that are designed to boost energy efficiency. Solar, wind, geothermal, and fuel cell technology are all eligible for the Residential Renewable Energy Tax Credit.

Disclaimer: we are Realtors, not tax attorneys or CPA, so the above should be treated as anecdotal. Please consult with your tax preparer before you claim any of the credits.

Tips around the house

Spring around the house

First warm days of season are upon us, and with this, it feels good just going outside after long months of cabin fever (particularly if you live up North). It is a good time to take a walk around your house, backyard, and garden, and check on everything after the winter season. Even if you live in an apartment, there are things you can do, so please continue reading our tips collected from around the Internet.

On your balcony or deck

  • Clean patio furniture. Soapy water and soft brush or sponge will do the trick for most types of materials.
  • Wash the pillows and outdoor rugs. Check the manufacturer’s instruction if fabrics can be washed in the washing machine.
  • Give your grill thorough scrub. Long-handled stiff-wire brush works on all types of grates.
  • Refill propane tank for grill to be ready for first grilling of the season (we already started ours!)
  • Check the deck surface: does it need any repairs? Maybe fresh coat of paint is in order this year?
  • Consider planting containers with ornamental plants, maybe even vegetables or herbs. Particularly if you do not have a big yard or live in condo, few containers will add life to your outdoor space.

Around the outside of your house

  • Wash your windows, from outside and inside. You will see so much more light coming in. My recently discovered quick tip – glass cleaner and squeegee.
  • Replace any used exterior light bulbs, on house walls, in the walkways, on the deck.
  • Check and clean gutters and spouts, make repairs if needed.
  • Hose down or power wash home exterior.
  • Check your roof for any obvious problems.
  • Check your fence if you have one: does it need any repairs? Is it in need of fresh coat of paint?

Lawn and backyard

  • Clean your lawn: brush back all remaining fall leaves and remove fallen branches. Pick up litter and any pet waste.
  • Identify bold spots in your lawn. Mix seeds with fresh soil and fertilizer and seed fresh grass. Remember to keep it moist until it starts growing!
  • Prune all shrubs and trees – it will encourage new growth
  • Check water hoses for cracks and leaks. Make any needed repairs – or buy new parts.

In the garden (or container garden)

  • Remove winter layer of mulch if you had any placed to cover plants from freezing
  • Add new layer of mulch around trees and shrubs
  • Cut majority of stalks of ornamental grasses to have them come back fresh
  • Pull any dead annuals. Consider replacing them new ones?
  • Remove dead growth of perennials, they will come back fresh and strong.
  • Take an inventory of plants you already have – and start planing what you want to add when time comes. Make shopping list of seeds or plants.
  • Build new vegetable beds if you need more/new ones. They will be ready when you need them!
  • Now it is also good time to seed cold-loving vegetables, for example salad greens or radishes. You will be able to enjoy them in no time.
Buyer

Rent or buy?

This is probably one of the most often asked questions and at the same time one that almost never has a clear cut answer. Our lives differ and what makes it even harder to answer this question is that everyone looks at life through their past experiences and biases.

When our clients or prospects ask us this question here is what we say…

Do you enjoy making your house your home?

Owning a house comes with great freedom of making it your own. While renting, the most you can ask for is probably paint change, but don’t expect to be presented with choice other than white, gray or beige. No landlord will agree to blue, green, red or any other non bland, neutral color, for fear of not being able to rent it again when you leave. Would you like to plant a raised bed garden? Install a play set with slide for your kid? You can forget about it when you rent.

Nobody will kick you out or increase your rent!

Owning a house means that your life is protected. You won’t be surprised by landlord changes, sudden rent increases or outright refusal to renew. No maintenance visits either. How would you feel if somebody regularly ‘inspected’ all your closets or bedrooms?

Uncle Sam prefers home owners

Yes, it is rare that uncle Sam is favoring one group over the other. Yet when it comes to owning the house the government clearly prefers that you own your home. To incentivize you to buy they allow you to deduct interest you pay on your mortgage from your taxes (as always, we are not tax professionals so please ask your tax preparer for details).

Your home can be your retirement fund or savings account

We all know how hard it is to save for the future. There is always this or that expense that gets in the way of regular contributions into your savings account. How about your house? Every single one of your monthly mortgage payments contains growing principal portion. Your equity is growing every month. I don’t know about you, but I appreciate this and am relived that my net worth is constantly growing.

And it brings interest!

Real estate traditionally is the safest way to conservatively grow your wealth. Properties appreciate on average between 5 and 10% every year. Not only does your equity grow because you make monthly contributions. It also brings interest!

One more thing – monthly cost in most cases will be lower

When you rent you not only have to pay for somebody else’s mortgage payment on the house. They also need to pay their property manager, accountant, build some nice maintenance reserves, pay business insurance and in the end, bring a profit. This all usually adds up to about 15% premium over what you would pay as an owner on the same property.

Is it all roses then, right?

Of course not. Sometimes it makes sense to rent. Here are some arguments for renting:

Are you planning to live in the place for at least 4-5 years?

As fun and rewarding as owning a house is, selling it comes with a cost. In addition to our commission you will have to credit the Buyer with prorated property taxes, in some states provide home warranty and title insurance and probably pay for some maintenance, upgrades or repairs requested by the future owners. On average you have to budget between 8 and 10% of your selling price as your cost of selling. Considering that in the beginning your monthly payments cover mostly interest it pays to wait few years before selling to build equity and let the house appreciate. If you plan for short stay, better rent.

Can you do small fixes on your own?

I’m not talking remodeling your kitchen or replacing roof, those are best to be left to professionals. Yet there are many small things (like replacing light bulbs, smoke detectors, cleaning dryer vent or cleaning siding and windows that are normally handled by the owner when you rent). All those are typically included in rent (see the mention of the own maintenance reserves) but if you can do them on your own in your house it will cost you only pennies on the dollar and will greatly lower your cost of ownership. On the other hand if you can’t tell which side of the screwdriver is the business end – better consider renting. The owner will have properly trained crew on call that will take care of those issues efficiently and quickly.

Rent vs. Own. There is no right answer. Only you can make that decision. No matter which way do you choose to go, we’re here to help. Let us know if you have any additional questions or comments, we’ll be happy to help!