22
Nov
By First Rate Financial Group
Real Estate

How Much Money To Budget For Home Maintenance

How Much Money To Budget For Home Maintenance1Owning a home comes with a lot of responsibilities. One of these involves home maintenance. Sometimes, people are surprised by the size and frequency of home maintenance costs.

In order to reduce the stress that comes with home maintenance, it is important to plan ahead of time. This means budgeting for the inevitable costs that come with home maintenance. There are a few systems that people can use to estimate their home maintenance costs.

The Percentage System

One of the most common systems that people use is the percentage system. In general, the amount of money that people spend on maintenance is directly related to the size of their home. The larger the home, the more money someone is going to spend on maintenance.

Most people will spend between 1 percent and 4 percent of their home’s value every year in maintenance costs. Older homes are going to have more maintenance costs than younger homes. For example, if a home is worth $300,000, someone is going to be spending between $3,000 and $12,000 per year on upkeep.

The Square Footage System

The range above might be too large for someone to budget accurately. Therefore, a lot of people also use the square footage system. Again, the larger the home, the more someone will spend on upkeep.

In general, someone should allocate $1 dollar per year per square foot of home. For example, if someone’s home is 2,500 square feet, they should allocate about $2,500 per year in home maintenance. 

Some of the downsides of this method are that it does not take into account the location or age of the home. Keep these factors in mind as well.

Home Maintenance Is Different Than Home Repairs

Home maintenance costs are very different than major repairs. The idea of maintenance is to prevent repairs from arising. If someone has to replace their HVAC unit or take out faulty wiring, this does not count as home maintenance costs.

With this in mind, it is important for everyone to budget accurately for home maintenance and to make sure these tasks are completed on-time. Proper home maintenance can save money on homeownership by preventing major repair bills from coming up down the road. 

And any time you have home maintenance questions, remember to ask your real estate professional. They have a lot of experience dealing with every type of home repair and a list of local referral maintenance providers.

If you are in the market for a new home or interested in refinancing your current property, be sure to contact your trusted home mortgage professional to discuss financing options.

15
Nov
By First Rate Financial Group
Real Estate

How To Navigate The Changing Remodeling Market

How To Navigate The Changing Remodeling MarketRemodeling is a common project that homeowners take on. If you are looking to remodel your home, it is important to keep in mind that this involves more than just improving your living area. If you remodel your home, you might also be expecting to generate a return on your investment. 

In prior years, a home remodel meant an increase in the value of your home. Furthermore, some people actually make money by buying homes, fixing them up, and selling them. This is commonly called “flipping.” Unfortunately, like other sectors of the economy, this market ebbs and flows. Recently, it looks like the drive to remodel homes has taken a downturn.

Why Homeowners Steer Away From Remodeling

There are financial and real estate professionals who analyze this market just as other professionals look at other areas of the economy. According to the professionals, there are a number of reasons why people might be steering away from a home remodel.

First, there has actually been a decline in home sales. This goes along with a decline in homebuilding activity. 

These factors cause homeowners to hesitate when they remodel their homes. If you are looking to sell your home, this is a prime time to remodel. You might think this remodel is necessary for your home to succeed on the market. If you aren’t looking to sell your home, there is less reason to remodel. When home sales drop, the remodeling market drops as well.

Home Price Appreciation Plays A Role

Another important factor involved in the home remodeling market is the pace of home appreciation. In prior years, the growth of home prices was outpacing the rate of income appreciation. In recent years, this trend has flipped.

When home prices aren’t rising faster than wages, there is less pressure to remodel. Instead of investing this money in a remodel, homeowners are looking to invest this money in other areas that might generate a bigger return. This has led to a reduction in the remodeling market.

Considering A Home Remodel

If you are looking to remodel your home, think about these factors ahead of time. You should expect a return on your remodeling investment. Take a look at the market before the remodel begins.

If you are in the market for a new home or interested in refinancing your current property, be sure to consult with your trusted home mortgage professional to discuss financing options.

13
Nov
By First Rate Financial Group
Real Estate

4 Critical Tips To Consider When Hiring A Home Contractor

4 Critical Tips To Consider When Hiring A Home ContractorThere are many reasons why you might be interested in hiring a home contractor. These professionals are an important part of helping someone attain their dream home. While everyone cares about the price of the contractor, this is not the only factor that you should consider.

After all, the home is where people spend a lot of their time. By thinking about price alone, you might be sacrificing quality. It is important for you to take the proper steps when it comes to hiring a home contractor. There are a few factors that you should keep in mind.

Start The Process With A Detailed Plan

This is the step that absolutely must be completed before you even approach a contractor. If you need help with this, think about reaching out to a designer or an architect who can help you. Walk your contractor through your plan step by step. This will help the contractor give you a more accurate price estimate and will allow the contractor to ask important questions. 

Give The Project Specifications Upfront

There are certain finishes or fixtures that you might want in your home. Make sure to provide your contractor with this list ahead of time. These specifications can drastically influence the price estimate. Save your time, as well as the contractors, by providing the specifications as early as possible. That way, the contractor can figure out how much each of these specifications is going to cost.

Ask About Insurance

It is also important for you to make sure your contractor has insurance. Sometimes, accidents happen. This is a reality of the industry. The contractor probably has a large crew that he or she needs to work with to help your project come together. This is not easy. When mishaps happen, your contractor needs to be set up to deal with these issues professionally.

Ask For Client References

Lastly, it is important for you to take a look at some of your home contractor’s work. Take a look at some of the prior projects and make sure you are satisfied with what you see. This will help you get a solid idea of what your project might look like when all is said and done. 

If you are interested in purchasing a new home or refinancing your current property, be sure to contact your trusted home mortgage professional to discuss current financing options.