Real Estate Information Archive

To all my clients, friends and family: I wish you a happy and prosperous 2012!

Potential buyers have a general perception newly built houses are in good condition and are therefore in good condition. But what if the builder used substandard material and practices? So, this statement is not necessarily true. There are houses that have been tested by years and years of use and negligence. Houses built years ago and that stood the test of time. An inspection to determine the quality and condition of the house is recommended in both cases.

• Take a good view at the house from a distance to see if the walls are smooth and flat. If you see cracks discuss it with a professional. It might mean nothing, but it is wise not to ignore it;
• The roof should be properly applied and appear neat;
• Check to see if there is any water damage proof. The excess water must be carried away from the house by the drainage pipes and downspouts;
• Doors must be inspected for open spaces between the door and frame;
• Make sure there is sufficient water pressure. You can turn on the faucets and flush the toilet;
• Are the air conditioners, furnace and heater in good condition and proper working order;
• Make sure the pipes between the fixtures and the heater is copper manufactured;
• The bath fixtures and kitchen fixtures should be in proper working order and of good quality;
• Make sure the main circuit breaker indicates a minimum of 100 amps;
• Quality workmanship should be reflected by the tile work and paint;
• Inspect the stairway. A tilted stairway indicates movement in the foundation.

Look in the attic to ensure the insulation has been done to the correct standard. In moderate climates the recommendation is R-19 (6 inches of fiberglass).

The above list can provide enough information to avoid the costs of a house inspector. If there are any concerns about the home you are about to buy, discuss this with a professional home inspector.

High cost of living, being over indebted or losses of income can worsen the default on mortgage payments. A short sale deals with the lender when the mortgagor can no longer keep up with the payments and the outstanding mortgage is higher than the property market value of the specific area. A short sale must be well explained for the benefit of the seller and the buyer. This process takes longer and is not the same as buying a marketable home.

When investing in a short sale thorough market analyzes and calculations are recommended. The property can be in a condition where renovations and reconstruct ions are required or hidden defects that will impact the repair budget. A contractor is usually of great help to estimate costs. These costs, together with the cost of maintaining the property, are an expense one should spread over a reasonable period. Maintenance, renovations and reconstruction is used to generate sales and can be seen as an expense. Over capitalizing happens when what one indebted costs more than the original value of the home.

Each short sale is different and has its own merits. A lot depends on the lender and on the listing agent. This is a time consuming process. Banks request a broker price opinion which takes a while. To convince the bank to accept your offer, the comparable sales have to support the sales price. The market value is determined by comparable sales of the same area similar to the home in question and with a similar floor plan.

The expertise of a real estate agent is essential when buying a short sale property. This is not a process that you would undertake without being educated, having sufficient knowledge about. For the best professional assistance we encourage you to contact us.

Extensive research was done by Business School professors Eli Beracha of East Carolina University and Ken H. Johnson of Florida International University to prove which makes more sense financially: to rent or to own a home. In their paper “Lessons from over 30 years of Buy versus Rent decisions: Is the American Dream always wise?” the professors do not dispute the social benefits of homeownership: “Home ownership is touted as the American Dream. It is credited with enhancing wealth, increasing civic pride, improving self-esteem, crime prevention, child development, and better educational outcomes, among other benefits. This paper does not dispute any of these claims.”

The professors researched the idea that homeownership is not a better investment plan than renting. “After setting the holding period to the average American’s tenure in a residence, renting (not buying) proves to be the superior investment strategy over most of the study period… Individuals, on average, were better off in economic terms to have rented for most of the years in the study period. This first result is strongly dependent upon fiscally disciplined individuals that, without fail, reinvest any residual savings from renting.” The Joint Centre for Housing Studies at Harvard found of a recent study that people do not actually reinvest savings successfully.

Both professors Beracha and Johnson came to the same conclusion: now is the time to buy. “Fundamental drivers now appear to be in place that favor homeownership over renting in the near term future and the second finding might seem unwise to many given the recent crash in the real estate markets around the country. However, rent-to-price ratios now seem to be in place along with other fundamental drivers that favor ownership over renting.”The research was concluded with: “Conditions (historically low mortgage rates and relatively low rent-to-price ratios) now seem in place to favor future purchases.”The finding of this research came to only one conclusion: Now is the best time to invest in a home.

Real Estate predictions for 2012:

According to the NAR’s chief economist, Lawrence Yun, the housing market is slowly recovering with a predicted 4% increase in sales for 2012. Celia Chen of Moody’s Analytics projected sales to increase over 20% in 2012. The next six months will reflect if the rumors about the possibility of a loss of consumer confidence hold water. Consumer confidence, as measured by the University of Michigan, has seen modest improvement in the last few months after taking a dip over the previous months. A hit in consumer confidence can have an impact on the Real Estate rebound.

Prices are predicted to decrease through the first two quarters of 2012. Decreased prices will force more homeowners into a position of negative equity. Being underwater is one of the reasons that cause people to strategically default on their mortgage payments. If this continues, there will be an increase in the number of foreclosures and cause a setback in consumer confidence. 

Home ownership is better than renting. By owning a home one invests into the property, so the money that you would normally use towards rent now goes into ownership. Once you know which home you want to buy, you should make an offer. Your real estate agent can assist you with the offer. Factors to consider are: The price should be in line with prices of similar homes in the area; the condition of the home (will it cost you a substantial amount of money to refurbish); has the home been on the market for some time now (the seller may be eager to accept a lower offer); make sure you can afford the offer. The closer your offer is to the asking price, the more likely your offer will be accepted. Offers often get rejected. The real estate agent will negotiate on your behalf.

When families enter into a contract to buy or sell a house, two things are true:

·         The buyer wants to own the home.

·         The seller wants to sell the home.

In order for both these things to take place, the transaction must be completed. That is not an easy task in the current market.  The National Association of Realtors (NAR) released their Existing Homes Sales Report yesterday. In the report, NAR announced that one out of every three contracts to purchase a home in October never made it to a closing table.  How does that ratio stack up against previous numbers? Cancelations have more than quadrupled in the last 14 months!  According to NAR, cancelations are caused by: “declined mortgage applications, failures in loan underwriting from appraised values coming in below the negotiated price, or other problems including home inspections and employment losses. ”

Having someone who truly knows the market is crucial if you are planning to buy or sell a home. This expert should know what is happening in real estate, understand why it is happening and be able to simply and effectively explain each point to you and your family.  There can be consequences if you don’t have a true industry professional on your side.

No one can guarantee you won’t face challenges. However, the best agents and mortgage professionals know how to manage the expectations of all the parties involved thus dramatically increasing the chances your deal will close and you and your family will be able to move on with your lives.

Amazing Christmas events are soon to be here:

• 4^th of December: The Annual Christmas tree Lighting.
   
• Join the Women’s Club of West Milford, the Ringwood Manor Citizen Advisory Committee, and Ringwood State Park Staff in celebrating the 36th Annual Victorian Christmas at Ringwood Manor. This is a lovely way to experience the magic of the holidays at a beautiful and historic North Jersey landmark. Tour dates are Saturday, December 3rd, Sunday, December 4th, Saturday, December 10th, and Sunday, December 11th 11:  am-5:00 pm on all four days.
   
• Christmas is also a time to give: Call your local Ringwood, NJ florist and send a gift of flowers along with warm holiday wishes for Christmas, Dec 25th, 2011.
  
  
  The movers just left leaving you alone at your new property.  It is time to sit down and list all those things you will have to do before relaxing on your couch and admiring your new possession:
   
• Install new locks. Since you probably have no idea who has a copy of your current keys, it is best not to take any chances. Consider making an extra set of keys and giving the copy to your parents or best friend.
   
• Purchase a fire extinguisher for the kitchen and keep it handy. Check and replace if necessary, all the batteries in the smoke detectors. If the house needs any preventive maintenance do it as early as possible. It will be really frustrating having to deal with contractors or paint while all your possessions are located inside the house.
• Check to see that all possible damage, like wet wood conditions or walls' deterioration.
   
• Clean the gutters and downspouts and check that drain water is directed away from the house.
   
• Service all heating equipment and check the chimney of the fireplace for possible damage.
   
• All medicines, poisons, or other dangerous elements have to be kept in child proof cabinets and cupboards.
   
• Keep flashlights, batteries, matches and candles in a special child proof drawer in an easy to reach place.
   
• Consider recording all the important house data and keep the papers related to your house in a safe or a drawer that locks. Also save all receipts of money spent for permanent improvements, repairs and any damage you had to fix. These can later be used for tax deduction purposes.

After you are settled in, introduce yourself to your neighbors and offer them a "hello" gift. Usually people are shy to bang on your door and introduce themselves, so it is better if you break the ice by introducing yourself. One of the reasons people enjoys living where they live is they know their neighbors. 

Household expenses take up a large portion of most people's paychecks. After all, you have to buy groceries and light your home. However, there are many simple ways to prevent these expenses from eating up all of your income. Get a handle on your household outflow by knowing how you spend your money and plugging up some leaks. You'll be amazed how small adjustments can have a big impact on your checkbook balance, and this page shows you some of the best small (and big) changes you can make.

So get ready to make a budget, reduce your monthly bills, and examine your everyday expenses to reduce your debt and build some savings.

List Current Expenses:

In order to have a better idea of how you personally can cut household expenses, you need to determine what your current expenses are.

• Collect all the receipts, bills, and financial statements that you can find. If you haven't saved such things in the past, start saving now and take a look at them after a month or so.

• Create categories for your expenses. You don't want to make a separate budget amount to cover each expense. Instead, you should plan on spending a specific amount of money on areas of expenditure in your life. For example, group airfare, train fare, and gasoline for long trips under a single category: travel.
   
• Write down fixed costs. Bills fall into this category, as well as commuter passes and other items you spend a given amount on each month. Calculate the average monthly cost of other items. For instance, you may not buy clothes every month, and each time you purchase new items the cost differs. Try adding up how much you've spent on clothes during the year, if you have those records. Then divide by 12 to get the average cost per month.

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Create a Budget

Once you've got an idea of what you currently spend in different categories, create a budget for the future, choosing areas where you think you can cut back on expenses.

Try to spot categories you can cut back, but be reasonable. If you set unreasonable goals, you'll get discouraged and may give up.

• Estimate what you'd like to spend on categories for which you don't have records. If you don't have records of what you've spent on things like clothes over the year, try to make a guess at how much you spend each month.
   
• Keep close track of all your expenses over the next couple months. Accrue statements during the week. Keep them in a safe place where you can find them to record later. Don't forget to note cash transactions.
   
• Compare what you thought you spend to what you actually spend. Hopefully, your estimates were on par. If not, make changes to your budget accordingly. Identify more areas where you think you should cut back. Adjust the budget for that category, and discipline yourself to stick to it.
   
• Come back to your budget at the end of each month to see how you're doing. If you have some extra money, make a budget category for savings or debt repayment and put that money to good use.

For more on budgeting, see Mahalo's How to Make a Budget.

Your credit rating is a score calculated by the lender based on your credit file, the amount you want to borrow, existing borrowings and the security you can put up. Your credit file is reviewed when applying for a homeowner loan, mortgage, and car finance and sometimes when applying for a job. Your credit rating can be considered your trustworthiness to repay the amount borrowed. It’s important that you know what your credit rating is and how to maintain it.

Good, Bad or Wrong?

A bad credit rating can be repaired and is not something to worry about long-term. However, if you are looking for a loan quickly, you will find fewer lending institutions willing to lend you money. Lenders that are willing to consider a consumer with an adverse credit history will charge greater interest rates.

A good credit rating will attract more loan companies offering larger amounts of money, more competitive interest rates and more flexible payment agreements.

Research states that around 80% of the credit files maintained by credit agencies contain outdated or incorrect information.

How do I Access my Credit File?

The first step to maintaining a healthy credit rating is to request your credit file from Equifax, Experian and Trans Union. You are entitled to one free report per year, however, you should request a report from all three because the files that they hold maybe different.

Review your Credit File:

Following is some of the most common errors and problems to look for when reviewing your credit file. If you notice any inaccuracies contact the credit agencies immediately. Keep copies of any correspondence and log all phone calls. Send copies of any documentation that supports you claim – do not send originals.

·        Basic Inaccuracies: Look for payments or accounts that are incorrectly recorded as late or unpaid. This can happen through no fault of your own when checks are late arriving or go missing in the post.

·        Identity Theft: This is a major concern of today and is one of the fastest growing crimes worldwide. Look for accounts that have been opened in your name without your knowledge or consent.

·        Credit File Requests: When you apply for a loan the lender will request your credit file. Each request is logged; carefully check for any fraudulent activates that could indicate an attempt at identity theft. Too many requests can be seen as detrimental by some lenders making it difficult to secure a loan.

·        Credit Fraud – Unauthorized Charges: Unauthorized use of your Credit Cards to purchase goods or services may go unnoticed, particularly if the fraud is through an account that you do not use regularly.

Manage your credit worthiness:

Credit agencies do not check the correctness of any information that is passed to them from your creditors; it is your responsibility to ensure that your credit file is correctly maintained. Requesting your credit report once per year regardless of wither there is a problem obtaining credit or not is the best way to ensure the credit files held with the agencies are accurate.

Ringwood is the best place to raise your children. With high quality school, parks and a lot of fun things to do, Ringwood will give you a warm welcome.

The New Jersey Children’s Museum is a great place to celebrate your child’s birthday party! Toddlers and older children love the fire truck, helicopter, cave and castle.

Pay a visit to the Ringwood Manor of Association of the Arts. See the amazing work of talented artists.

For years, economists have used the study of behavioral finance to explain the role emotions play in investment making decisions. Their surveillance has turned up some interesting results. Here are their findings:

• Investors know very well that the stock market has its ups and downs, some will still base investment decisions on the assumption that what’s happening now will continue in the future. For example, the home buyer driven by a hot market will engage in bidding wars, assuming that the market will continue to heat up. The buyer believes he or she has to buy now or lose out.
• Other investors follow the “anchoring” concept, in which they hold off selling an asset in hopes that it will increase in value despite evidence to the contrary. In this scenario, home buyers stubbornly anchor themselves to an offering price even though the seller and buyer are only a few hundred dollars apart.
• Some investors buy too much house for their budget or they forget about the crumbling foundation, because they love the seller’s decor.
• In most cases investors fail to see beyond the clutter as to possibilities of a home.

To prevent such problems, the emotional home buyer needs the perspective of a Real Estate agent. The expertise of a Real Estate agent can separate the emotion from the investment so your dream home will not become a disappointment.

Brace yourself! The tenth annual Harvest Festival features at the New Jersey State Botanical Garden on Saturday the 1^st of October 2011 and on October the 2^nd of October 2011 from 10.00a.m. – 5.00p.m.  Rain or sunshine!

Come and experience all the exciting and fun filled activities. These include hay rides, pumpkin painting, a caricaturist, storytellers, children’s games and a few surprises! Bring your camera to capture the free guided garden tours. The pictorial Botanic Garden is an absolute breathtaking site during fall. Experience the color scope of fall. Free parking available. Here at the Craft Fair you can buy a huge variety of hand crafted items. This will be a great opportunity to buy gifts for the nearing festive season.  There will be delicious temptations and October Festival Food for the hungry. Fantastic live music will add to the festivities. Wear your cowgirl boots for the Line Dance! NJBG is located on Morris Road, Ringwood State Park, Ringwood, New Jersey. This weekend will be sponsored by NJBG/Sky lands Association.

While in the party mood, Ringwood has a lot more to offer. The vibrant Nightlife , bars, clubs e.g. Orange Whip are not to be missed.

A supreme site to see is the 74 acre Shepherd Lake and woods. This is a spectacular site to see during fall. Red, yellow and orange are like paint spatters amongst the remaining green. There are hiking trails and paths for the family in the park and by the lake. This is a must during fall. During 2004, the New Jersey Legislature passed the Highlands Water Protection and Planning Act, which regulates the New Jersey Highlands region. Ringwood was included in the highlands preservation area and is subject to the rules of the act and the Highlands Water Protection and Planning Council, a division of the New Jersey Department of Environmental Protection. All of the territory in the protected region is classified as being in the highlands preservation area, and thus subject to additional rules.

The Ringwood Chamber of Commerce sponsored their 1^st Buy Local Event at the Ringwood Farmer’s Market on Saturday, September 10^th and it was an outstanding success.

The 450+ people in attendance got more than just the wonderful goodies, fresh produce, eggs and plants that they’ve grown accustomed to from the Farmer’s Market, there were representatives from more than 20 local businesses on hand providing fun, games and wonderful giveaways for all members of the family!

Children had the opportunity to work on craft projects at Educare’s table or to have their faces painted at the Papillon Montessori table while Moms , Dads and other grown ups checked out some of the other offerings- Pop A Lock provided copies of keys, the lovely ladies from  TD bank had lots of fun stuff and Coldwell Banker’s- “Only” Orly provided  real estate information AND  free bottles of water that partnered beautifully with the attractive “Buy Local” koozies and shopping bags donated by the Chamber of Commerce!

 Nicole from The New You demonstrated proper exercise techniques and Coppola Services was represented.  Among the impressive displays were beautiful custom frames  from Saframes and gorgeous photography  from local photographer Melissa Griegel . If you were looking to get your financial affairs or Insurance needs in order Laura Ingraffea and the Cellas from AllState were on hand, too!

The Membership of the Ringwood Chamber of Commerce are strong supporters of  local community events and sponsor the Annual Christmas Tree and  Menorah lightings, The Ringwood Roundabout publication, several scholarships and contributes to The Ringwood St. Patrick’s Day Parade, and many other events.  For information on joining the Chamber or learning about other events visit www.ringwoodchamber.com