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Finding the Right Home for You and Your Family

by Melissa Thompson

Purchasing a home is such a huge decision, you definitely want it to be the right one.  Before even starting the home search process, it’s important to think about what it is you want from your new home. 

For many the location of a property is the priority.  Perhaps you have your heart set on a charming neighborhood that you have always loved.  Or maybe you want a specific school district for your children. Whatever the reason, location is as important financially as it is emotionally. You are making an investment and future resale value should be taken into consideration. Figuring out where you want to live is the first step in finding the house that is right for you and your family.  Once you have an idea of where you want to live, you may discover that you might have to compromise a bit on the type of house you want.  For example, perhaps you like the idea of a ranch style home with a big yard, but there is nothing like that available in the area you chose.  If your priority is a certain style of home, you may have to compromise on the location. Location: The Most Important Factor in Real Estate

Looking for a home based on architectural style can be challenging, especially if you are moving to a new area that you are not familiar with.  One way to do it is to use the key word option on real estate search sites to type in descriptive words.  Once again, you may have to adjust your expectations because you might find a house you love in a neighborhood that you don’t like so much.  Perhaps new construction is the way to go for you.  That way you can choose where you want to live and build to your specifications. 26 Popular Architectural Home Styles

Often finances will dictate where you can search for a house based on what you can afford.  If you’re handy and don’t mind the idea of a fixer-upper, you might be able to find a diamond in the rough for a great price.  Just keep in mind the future expenses of renovating it. If a move-in ready home is what you’re looking for, maybe you should consider a town-home or condo, especially if the amenities that often come with those types of homes appeal to you.

There are so many questions to ask yourself before you begin looking for a house.  Do you want a big yard or do you hate yard work?  Do you want to be able to walk to restaurants and shops or do you prefer country living?  Do you mind a long commute to your job or do you want to live near where you work?  Take time to think these things through before you start your home search. Trust me, it will go more smoothly and be much more enjoyable if you go into it knowing what you want!

If you are in the market to buy or sell a home in the Memphis area, contact professional Realtor, Melissa Thompson and let her help you with all your real estate needs. Give her a call at 901-729-9526 today!

Don’t Get Blindsided by Unexpected Expenses!

by Melissa Thompson

Buying your first home is exciting.  After getting approved for a mortgage loan, working with a professional realtor and finding your dream home, it’s time to settle in and start enjoying your new digs.  Then BAM!  The shock of an unexpected expense slaps you in the face.  Don’t let that happen to you.  Being informed about the possible expenses of being a homeowner will not make spending the money any more fun, but at least you will be prepared.  Here are some ancillary costs of homeownership that you should be aware of:

  • CLOSING COSTS - When closing on your mortgage you will be presented with a long list of costs: mortgage taxes, lender application fees, attorney’s fees, title insurance, recording fees and any potential real estate tax reimbursements if the seller has paid them up front.  Altogether, closing costs are an average of 2 to 5 percent of the total cost of the home.  They will vary state to state.  Closing cost information for Tennessee can be found here: Tennessee Average Closing Costs
     
  • HOME MAINTENANCE - Now that you are a homeowner, you are solely responsible for the maintenance and upkeep of your property.  Everything from yardwork to cleaning; pressure washing to clearing the gutters…it’s all in your hands and on your dime.  Oh…and fixing things.  Yeah.  When the AC isn’t working or there is a leaky faucet, you will be footing the bill for repairs.  This all sounds a bit scary, but the key is to be prepared.  Go into your home purchase knowing that you will likely be spending about 1% of the purchase price of your home on maintenance annually.
     
  • PROPERTY TAXES - Property taxes vary by state and can also vary based on city, ordinance, and even specific house.  You can utilize a Property Tax Calculator  to get an idea of what your taxes will be when planning for your expenses.
     
  • UTILITIES - If you’re coming from a rental where your utilities were included with the rent, you may not have considered how much you will need to set aside to pay for electricity, gas, water and sewage costs.  Added to internet, cable and phone bills, it can be quite a chunk of change.  Planning for utility costs is crucial to making sure you can afford to live in a home of your own.
     
  • HOMEOWNER'S INSURANCE - When you get a mortgage, you must get homeowner's insurance as well.  Be sure to do your homework and shop around for the best possible price.  You can get discounts for things like security systems, working from home or bundling coverage for your home with your auto insurance policy.  Educate yourself on what your insurance policy covers so that you’re not left disappointed when you must pay for something you thought would be taken care of.

Don’t let these expenses scare you off from purchasing a home.  Again, the key is to be aware of them going in so that you won’t be caught off guard when they come up.

If you are ready to purchase your first home, let professional Realtor Melissa Thompson  assist you in your home search. Give her a call at 901-729-9526 today!

Photo Credit: moneyweek.com

Guide to Buying a Home - Summer 2018

by Melissa Thompson

Purchasing a home is likely the largest financial commitment you will ever make. It’s not one to be taken lightly. But while it can be overwhelming and a little scary, it is also smart.  Owning a home is an investment in your future, and with that in mind, you want to make sure that you are making educated decisions so that you get the best deal possible.

Summer is a popular time for home shopping. But before you start your home search in earnest, it’s vital that you understand what the real estate market is like for buyers right now.  While existing home sales and list prices have risen this year, there are still perks to starting your home search. These tips will help you get the most out of the 2018 summer housing market!

  • Prices sometimes drop during summer.

While summer is a busy home-buying season, it’s not nearly as busy as spring. Because of this, prices may drop between May-October.  Waiting until late August may mean that you can snag a sweet deal! The Best Time to Buy a Home is in August & September

  • PMI is getting more affordable.

Private Mortgage Insurance is getting cheaper with PMI lenders MGIC and Radian having lowered their rates this spring.  That means other PMI companies will become more competitive, which will bring all of them down.  With PMI required when homebuyers put less that 20 percent down, lower rates mean that purchasing a home will be affordable for more home buyers.

  • Don’t discount older listings.

Don’t make assumptions about houses that have been on the market for a long time.  There are many reasons why a house may not sell quickly.  Often if might just be due to a buyer getting cold feet and pulling out on a deal, or perhaps financing fell through. That doesn’t mean it’s a “bad” house.  And remember…if it’s been on the market awhile, the price is likely to come down, meaning you will get a better deal!

  • Consider a fixer-upper.

Flexibility on your part is a must in a busy market.  You may have been dreaming of a sparkling, move-in ready home, but a fixer-upper could possibly be the dream house you’ve really been looking for.  There is definitely more to choose from if you’re willing to take on a fixer-upper.  The number of starter homes on the market is shrinking, but there are more fixer-uppers among them than there were six years ago.  Choosing a fixer-upper will also give you more time for decision making.  Move-in ready homes go quickly and competition for them is fierce, so if that’s what you want you are going to have to be prepared to move quickly!

  • Get to know the neighborhood.

When the market is competitive, it’s tempting to make an offer on any property that appeals to you.  This can be misguided if you haven’t even checked out the neighborhood.  If you end up in a great house in the wrong neighborhood for you, it will never truly feel like home.

  • Make a good offer.

Now is NOT the time for a low-ball offer.  But keep in mind that the strongest offer is not necessarily the highest one.  If you have the funds available, a lower cash offer can often win out over a higher one that is being financed.  Of course, coming up with that kind of money may not be feasible, but there are other ways to strengthen your offer without upping the amount.  Generous contingencies, like a shorter closing or inspection period or Writing a Winning Offer Letter can also help you stand out to sellers.

If you are considering buying or selling a home this summer, call Melissa Thompson at 901-729-9526 and let her help you with all your real estate needs!

Photo Credit: realestateclipart.com

Things to Look for When House Hunting: A Top Ten List

by Melissa Thompson

House hunting can be overwhelming sometimes, especially for first-time home buyers.  Chances are you might get caught up in the process and important details might slip by you. While the number of rooms, condition of the kitchen, and size of the yard are important, there are other things to consider before you make an offer.  This list of things to look for can help get your search off to the right start.

Location, Location, Location

They say that the 3 most important things to look for when buying a home are location, location and location.  While a home might not be perfect, loving your neighborhood and neighbors can make all the difference in living with imperfection.  And face it…you can change almost anything about your house, but you can’t change its location or the people living nearby.  When you go house hunting, make sure to consider the home’s proximity to your work, the appeal of the neighborhood, where in the neighborhood the home is situated, ease of access, noise from neighbors, traffic, pets and access to parks, shopping, schools and public transportation.

Home Placement

Beyond location, look at how the home is situated.  If the home is on a hill does it have a view, a walkout basement, or lots of stairs to climb? Do neighbors' windows look directly into the home? Is the yard suitable for kids, pets, gardening, or other uses? Is their safe access to the home? These are all important questions to ask yourself when determining if it is the right property for you.

Check Out the Neighborhood

While it’s important for your house to meet your expectations, it’s equally important that the neighborhood meets them too. Take a drive around the development you are interested in on week days and weekends, during the day and in the evening.  Are the homes in good repair? Are yards kept clean and tidy?  Is the neighborhood safe enough for people to walk, run or bike?  Are there children playing outdoors?

Consider a Home’s Curb Appeal

You want a home that is going to reflect your lifestyle. Do you live a casual, laid-back life? Then you probably won’t want a formal Victorian or Tudor style home.  A simple, contemporary home might better suit you.  Pay close attention to exterior features.  Think about maintenance.  For example, a brick home is easier to maintain than one with siding.  Do you like working in the yard?  If not, you might not want a house with extensive landscaping.  Is the roof in good condition?  Attention to detail will help you choose the home with the best curb appeal for you.

Size and Floor Plan

You may be thinking about buying your dream home. But is your dream home practical?  Do you need 4 bedrooms and 4 baths when you live alone? A spacious home may provide the extra room you've always wanted for a home office or a theater room, but you'll pay higher heating bills and have higher taxes. Additionally, it will take more furniture to furnish and money to decorate. Think about how the new home space will be used and whether it will fit your lifestyle now and in the future.

Bedrooms and Bathrooms

Decide how many bedrooms and bathrooms you will need and only look at homes that meet that criteria.  You don’t want to fall in love with what is otherwise a perfect house if it doesn’t provide the space needed for your family.  It’s smart to consider counting an extra bedroom in that number so that you have additional space for a home office or guest room. If you think you might add on to the home later, make sure you consult an architect who can advise you on space planning and regulations.

The Kitchen

For many people, the kitchen is the heart of the home. Don’t settle for a home with a kitchen that doesn’t work for you.  Yes, you can remodel later, but at great expense.  If it’s an easy fix like replacing cabinets or countertops, get a price quote before committing the house so that you will know if it is within your budget to take that on.

Closets and Storage

Older homes often have small closets and lack storage space.  As you’re looking at a home ask yourself where you will store your belongings.  Tiny closets don’t have to be a deal breaker.  There are ways to maximize storage without renovations. Newer homes tend to have lots of storage and you may sacrifice living space while having more closet space than you need.

Windows and Lighting

While looking at a home keep in mind your preferences regarding light and privacy.  Do you want a lot of windows to provider bright, sunny rooms?  Pay attention to the locations of electrical outlets and fixtures to make sure they will meet your lighting needs.      

Finishing Touches

Even a simple home can look spectacular with the right moldings, hardware, and a fireplace.  If elements like these are important to you, look for them while house hunting. 

You may not find everything you want in one house, but keep this list handy and you are more likely to find the home that best suits your needs and desires.  Better yet, let Melissa Thompson and her Team at Your Key to Memphis help you find your dream house today!

Happy House Hunting!

Photo credit: gorenter.com

How Much Do You Need to Make to Buy a Home in Your State?

by Melissa Thompson

It’s no mystery that cost of living varies drastically depending on where you live, so a new study by GOBankingRates set out to find out what minimum salary you would need to make in order to buy a median-priced home in each of the 50 states, and Washington, D.C.

States in the Midwest came out on top as most affordable, requiring the smallest salaries in order to buy a median-priced home. States with large metropolitan areas saw a bump in the average salary needed to buy with California, Washington, D.C., and Hawaii edging out all others with the highest salaries required.

Below is a map with the full results of the study:

GoBankingRates gave this advice to anyone considering a home purchase,

“Before you buy a home, it’s important to find out if you can afford the monthly mortgage payment. To do this, some financial experts recommend your housing costs — primarily your mortgage payments — shouldn’t consume more than 30 percent of your monthly income.”

As we recently reported, research from Zillow shows that historically, Americans had spent 21% of their income on owning a median-priced home. The latest data from the fourth quarter of 2017 shows that the percentage of income needed today is only 15.7%!

Bottom Line

If you are considering buying a home, whether it’s your first time or your fifth time, let The Melissa Thompson Team help evaluate your ability to do so in today’s market! 901-729-9526

By: KCM Crew

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Homeowner’s Insurance: The Basics

by Melissa Thompson

Becoming a homeowner for the first time can seem like a daunting task. There are so many details and many first-time homebuyers don’t know all the ins and outs of homeownership. It’s important to educate yourself and be prepared for what’s to come.  One aspect of being a homeowner is paying homeowner’s insurance. 

To understand how you pay for homeowner’s insurance, you need to understand your monthly mortgage payment and how it breaks down.  There are four parts to you mortgage payment: PITI.  This stands for principal, interest, taxes and insurance.  The insurance part of your payment can vary depending upon your loan type.  There are some insurances that are required when you obtain a mortgage, and others that are not.  It’s up to you to decide what you need and to do so, you need to understand what they cover.

Private Mortgage Insurance (PMI) will usually be required if you are putting down less that 20% on your home purchase.  But not all loans require PMI.  For example, a VA Loan does not require the borrower to pay PMI. It is replaced by an upfront VA Funding Fee.  Even if you are required to purchase PMI, once you have 20% equity in your home, it can be dropped.

Homeowners insurance is another requirement of getting a mortgage loan.  This is the insurance that protects your home in the event of fire, theft, or damage.  Depending on the insurance you choose, you may be covered for things like stolen jewelry and stolen or damaged electronics and/or furniture.  You must be able to provide proof of insurance to your lender before closing on your home.  This insurance not only protects you as the homeowner, but it also protects the lender in case of foreclosure or in the event of a disaster.  It is common for the lender to require you have at least enough insurance to cover the cost of rebuilding the home.

Another requirement is that you purchase Title Insurance.  This insurance protects you by providing proof of legal ownership should someone else try to claim ownership of the property.  Should a title dispute arise resulting from a sale, the title insurance may be responsible for paying specific legal damages, depending on the policy you have.

There are additional insurances that are not required by your lender, but you may want to consider them for more protection.  Personal property insurance may cover personal belongings that your homeowner’s insurance does not cover, like art, collectibles, and firearms.  A home warranty is not insurance, but does offer further protection should something break. For example, you might want a home warranty for your HVAC system to cover the cost of service should it need repairs.  Purchasing additional insurance or a home warranty is a personal choice. You can talk to your mortgage banker and insurance agent regarding your options.

If you are interested in purchasing a home, the professionals at Your Key to Memphis can help you find your dream home and answer any questions you may have.  Contact Melissa Thompson and her team at 901-756-8900 or 901-729-9526 and start your home search today!

How to Handle a Bidding War

by Melissa Thompson

It is a seller's market in real estate this year and with spring around the corner, the competition for homes is likely to get even more fierce.  If you are looking to purchase a home right now, chances are you may find yourself in a bidding war. Be prepared!  Here are six ways to come out on top in a bidding war:

Get your finances in order and get as much cash as you can.  It is never too soon to get pre-approved for a loan. In fact, the sooner the better.  Sellers will have lots of options and will be leery of those who do not have loans set in stone.  If possible, bring cash to the table.  Sellers will fear appraisals coming in low and loans falling through, so be prepared to cover the difference with cash.

- Don’t hesitate!  Be the first to make an offer, and make it a good one.  An insulting offer will put you at the bottom of the seller’s list, so it is not a good time to low ball.  Come in at or slightly below asking price so that they know you are serious about purchasing their home.

- Have an escalation clause in your offer. This is the amount of money the buyer agrees to increase the offer if there are other bids. If you offer the asking price of $400,000 on a house, but it might sell for $450,000, put in an escalation clause stating that you are willing to go as high as $460,000.  But know your limit.  Don’t offer more than you can handle.  Also, make sure the clause states that the seller can only take the winning bid up to a level just above the competing offers.  For example, if an offer comes in for $430,000, your bid would be upped to $431,000.

- Get a pre-inspection.  It will cost you a few hundred dollars, but it can help you in a super-tight market.  If you can make a bid that is not contingent upon inspection, sellers will look favorably on your offer versus the same offer from someone who has a contingency in their contract.

Show the love!  If you have found the perfect house and know you love it, don’t be afraid to let the sellers know, either directly or through your Realtor.  You can write a letter, send pictures of your family or even make a video describing why you love the house so much.  Be specific in your praise.  Sellers may appreciation the connection you feel with the house and choose you over other bidders.​

Think with your head, not your heart. Be smart! Purchasing a home is an emotional decision, but emotions can get in the way of making wise decisions.   Make sure you have done thorough research of the market: look at the most recent comparable sales, compare prices from a year ago, visit local school, have coffee at the closest café and speak to potential neighbors.  Look at listings nearby.  Whatever you do, don’t overpay because you get caught up in the heat of the competition.  While the house may seem perfect for you, it is not the only house that will be perfect for you. So, keep a level head and make intelligent decisions.

Melissa Thompson is an experienced, professional Realtor who can help you through the negotiations involved in a bidding war.  Give her a call at 901-756--8900 and start your home search today!

YOUR HOME SEARCH STARTS HERE            FIND OUT WHAT YOUR HOME IS WORTH  

Photo credit: Active Rain

Buying a House? Don’t Skip the Home Inspection!

by Melissa Thompson

With all the fees and expenses involved in purchasing a home, it may be tempting to skip the home inspection to avoid spending the money.  But in the long run, it may cost you more to skip it. Home inspections sometimes reveal things that ultimately could have cost you way more than the fee involved.

While you might think that sellers are being honest about the condition of the home, it’s important not to take their word for it.  Truthfully, they probably are being honest.  But they don’t necessarily see what could be “wrong” with the house any more than you do.  That’s why you need an expert to come in and do the inspection. They can find things that never would be noticed by the naked eye because they know what to look for. Home inspectors can also give you advice and things to look out for in the future. With that information, you can have an idea of how to prepare for potential costs down the road.

A home inspection can be a deal breaker as well.  For example, if sellers offer a discounted price or cash back for skipping the inspection, walk away from the deal.  This is a huge red flag!  A home inspection only takes a few hours and is paid for by buyers, so there is no reason sellers should protest unless there are critical issues in the home they know about and are trying to hide.

When hiring a home inspector, you want someone with many years of experience and proper certifications and licenses. You also want someone who will be thorough…willing to go through the basement, attic and up on the roof to check out every nook and cranny of the home.  It’s important to gather as much information about the house as possible so that you know what you are getting in to.

It is not mandatory for you to be present for the inspection, but it’s a good idea to be there.  Some inspectors are happy to have you walk along with them and ask questions as you go.  Others will want to do the inspection on their own and then have you do a walk through with them after they are done.  Either way, be sure to look carefully through the report they give you and ask as many questions as you want.  Remember that you are paying for their time, so don’t hesitate to have them go over the report with you so that you have a clear understanding of it.

Even if your inspection comes up clean, the fee you pay is worth the price to have peace of mind. Include it in your home-buying budget and don’t think of it as an “extra” expense.  It is a crucial element of your decision in purchasing the home and paying a $450 fee and finding nothing wrong is better than skipping it and ending up having to replace your roof for $3000! 

http://www.yourkeytomemphis.com/Blog/Free-Yourself-from-Debt-and-Become-a-Homeowner

http://www.yourkeytomemphis.com/Blog/Debunking-Real-Estate-Myths

http://www.yourkeytomemphis.com/Blog/Buying-a-Home-Can-Be-Scary-Unless-You-Know-the-Facts

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5 Reasons Millennials Choose to Buy

by Melissa Thompson

Some Highlights:

- “The majority of millennials said they consider owning a home more sensible than renting for both financial and lifestyle reasons — including control of living space, flexibility in future decisions, privacy and security, and living in a nice home.”

- The top reason millennials choose to buy is to have control over their living space, at 93%.

- Many millennials who rent a home or apartment prior to buying their own homes dream of the day when they will be able to paint the walls whatever color they’d like, or renovate an outdated part of their living space.

Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your Real Estate needs!

By: KCM Crew

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Free Yourself from Debt and Become a Homeowner!

by Melissa Thompson

As a Realtor, I love helping people purchase their first home.  However, there are two major challenges that I see time and time again with first time home buyers:

- They often carry too much debt.
- They don’t have enough cash for a down payment.

These two issues are strongly related in that people need to reduce debts that inhibit them from saving money.

We all know that we shouldn’t spend more than we earn, but falling into the debt trap is easy to do.  You see an expensive item that you must have and you think, I will use my credit card now and pay for it with my next paycheck.  It sounds reasonable at the time, but next thing you know you’ve done something like that often enough that there is a beastly credit card balance hanging over your head.

So, now you’re in debt.  You have regrets, but no use doing the “should have, would have, could have” dance.  Now it’s time to move forward and take the steps needed to reduce your debt.  Here is a list of things to do to change the way you manage your money.  Follow these steps and before you know it you will be on your way to saving for a down payment on your first home!

- Stop adding to your debt. The first step to getting out of debt is to stop adding to your outstanding balances. To remove temptation, carry only one credit card with you…and make sure it is the one with the lowest limit so that it is impossible to get into serious trouble with it.  Leave any other credit cards in a safe place at home to keep yourself from going on an impulsive shopping spree. 

- Take an inventory of your spending habits. This may not be a fun activity, but it is helpful to see how you are spending.  Create a list of where your money goes each month including rent, utilities, car payments, food, credit cards etc. Once you have done this, split the list into two categories: bills you must pay every month and debts you need to pay off.  The second list then can be organized in order of urgency, either based on outstanding balance or highest interest rate.  Now you will have a clear picture of your debt situation. Financial Inventory

- Eliminate the largest debts first. Make a minimum payment for each of your credit card bills, but then make an extra payment on the bill that is at the top of your list. Do this monthly until that bill is paid in full.  Now take the money you were using for that bill and start applying it to the second item on your list.  Continue this until all of them are paid off. 

- Cutting expenses and making the payment.  If you are already in debt, how are you going to find money for an extra payment?  Well, some sacrifices must be made.  Cutting back on extras like trips to Starbucks, entertainment and eating out can free up cash that can go toward that extra payment each month.  Ways to Cut Monthly Expenses

- Prepare for the Unexpected. Sometimes life is a struggle and unexpected challenges such as car repairs or medical expenses will pop up from time to time.  As you cut expenses and start to save money, set up an emergency savings account just for these occasions.  That way you will be prepared and won’t have to use a credit card and add to your debt.

- Lower your interest rates. Give your credit card company a call to see if they will lower your interest rate. If they say no, shop around for a card with a lower rate and transfer your debt (be careful of transfer fees to make sure the transfer benefits you). You can also seek out a consolidation loan from your bank. They will pay off your debt and you can pay them back at a lower interest rate. How to Lower Credit Card Interest Rates

- Stick to it!  As you see your debt decrease and see your cash increase, don’t fall back into old spending habits. As you have more money available, put it right into your savings and soon you will have the money you need for a down payment on your first home!

When you are ready to start your home search, contact the professionals at Your Key to Memphis to assist you with all your real estate needs!

http://www.yourkeytomemphis.com/Blog/Buying-or-Selling-in-2018-5-Reasons-to-Resolve-to-Hire-a-Pro

http://www.yourkeytomemphis.com/Blog/Housing-Prices-are-NOT-Heading-for-Another-Crash

http://www.yourkeytomemphis.com/Blog/Debunking-Real-Estate-Myths

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