Good Fences: 10 Tips On Dealing With Difficult Neighbors

How to Handle Difficult Neighbors

by ALEX THATCHER
When searching to buy your home, you probably have a checklist of needs and wants for your new house and location. But do you factor in the potential neighbors? Finding dream neighbors is always a gamble, as you never know who will share your fence. If you find that you’re experiencing conflict or difficulty with one of your neighbors, follow these 10 tips for handling the trouble.
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1. Be Proactive

If you’re experiencing difficulties with a neighbor, whether the offender is a noise maker or a careless pet owner, try to prevent the situation from escalating. Begin by addressing the issue promptly: be proactive. By addressing the issue early on, you won’t allow resentment to build, which could make matters worse.

2. Start a Dialog

Call your difficult neighbor, and ask if there is a good time to talk about the situation. Be sure to listen. While you may feel entitled to make accusations, instead, engage your neighbor in an open dialogue and share what you’ve been experiencing. Ask questions, open ones, that could lead to solutions to the problem.

3. Write a Letter

If starting a dialog fails to be productive, consider writing a personal letter. By giving someone the space to process the issue on their own time, you may be able to achieve a better resolution.

4. Seek Local Aid

If necessary, contact your block or homeowners association for help resolving your issues with your neighbor. Be sure to look up local noise and disturbance laws, and cite an ordinance that applies to your situation when you contact the pertinent association.

5. Practice Empathy

When approaching a neighbor with a complaint, practice empathy and consider how you would like to be approached if you were the one creating the nuisance. Problem solve by asking what you too can do to be a great neighbor, and don’t approach your neighbor while the problem is occurring, or at an inconvenient time of day. Empathy can be everything in finding a positive solution to your problem.

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6. Start Off on a Good Foot

While the above suggestions are helpful to those who are currently encountering difficult neighbors, what if you’re new to the area or you have yet to encounter neighborly quarrels? Start by introducing yourself, and then here are a few ideas to proactively mitigate disputes with troublesome neighbors.

7. Host an Event

Start things off right with your neighbors. Get to know them — what are their names? Do they have families? Show you are interested in caring for the people in your immediate area. An easy way to break the ice? Organize a neighborhood block party, or agree to host a potluck.

8. Show Old Fashioned Etiquette

Drop by and bring your neighbor an unexpected gift. This doesn’t have to be a large gesture — delivering baked goods with a simple note is a great way to reach out to your neighbors. By showing that you care about your neighbors, you’re developing positive associations that will go a long way in problem solving any disputes.

9. Ask Questions

Another great way to cultivate a positive relationship with your neighbors is to ask questions. This may seem simple, and it is, but it’s often overlooked. If you don’t want to be too personal, ask for a restaurant recommendation or for directions to a nearby area. Questions show you value their thought, an important foundation for uncomfortable discussions.

10. Build a Rapport

According to a psychological phenomenon, the Benjamin Franklin effect, if you do perform a favor for someone, as a result, you will tend to like that person. The reason is as follows: people tend to justify kind actions by assuming a favor was performed because the person who received the favor is liked and deserving of the favor.

While kind gestures towards your neighbors will likely be well appreciated, follow this counter-intuitive logic by also creating opportunities for your neighbors to do something kind for you. A couple ideas? Ask a neighbor to check your mail while you’re on vacation, or to park in your driveway while you’re away to keep your home safe. By establishing a positive rapport between you and your neighbors, you’ll set a foundation for open dialog if issues do arise.

Be a Good Neighbor

The bottom line? Conflict may arise between you and your neighbor, and if it does, use these tips to resolve issues in a healthy, proactive way. But most importantly, exercise kindness and be a good neighbor — this will go a long way in solving any future troubles.

3 Things to Look For in Replacement Windows

If window replacement is in your future, it’s time to read up on the latest in available features and materials.

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Of all the components that go into residential construction, windows stand out as one of the few that heavily influence both the look of the home and its performance. But while windows are visible indoors and out, playing roles in interior design as well as outward curb appeal, people rarely install new windows for aesthetic reasons alone. Typically, says Jim Eldredge, a product manager with Sears Home Services, window-shopping homeowners are driven by practical concerns that include energy efficiency, maintenance, and security. If for any reason you’re now in the planning stages of a window replacement project, “your timing couldn’t be better,” Eldredge adds, noting that in recent years, window design and manufacturing have advanced by leaps and bounds. Today, the best windows boast an unprecedented degree of sophistication and offer a host of compelling new features. Some are minor—nice to have but nonessential. According to Eldredge, however, there are at least three features that are “worth it to insist on.” Read on to learn which are the most pivotal, and why.

 

ENERGY EFFICIENCY

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“A good window is a poor wall”—that old saying goes back to the days when wood-framed, single-paned windows couldn’t compete with the thermal resistance of an insulated exterior wall. “That’s changing,” says Eldredge. There’s still no such thing as a perfect window, but many now boast best-ever efficiency. If you’re pursuing window replacement in an effort to conserve energy and control utility costs, Eldredge recommends “focusing only on windows with Energy Star certification,” like the Weatherbeater line installed by Sears Home Services. Weatherbeater windows are double-paned for added insulation, and argon, a denser-than-air gas injected in between the panes insulates even further. Another secret to the efficiency of modern windows: the use of a transparent, micro-thin layer of metal oxide, known as low-e coating. In the summer, low-e works to limit solar heat gain, while in winter, it prevents heat from escaping. Year-round, low-e protects rugs, upholstered furniture, and artwork from fading under the effects of ultraviolet sunlight. “It’s like sunscreen for your house,” Eldredge concludes.

 

LOW MAINTENANCE

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If they’re going to look great and perform well over the long term, windows require care. How much? That “depends a lot on the material composition of the frame,” Eldredge says. Wood, though beautiful, demands the most attention. Aluminum stands up comparatively well to the rigors of year-round exposure, but it falls short in other ways. For example, as it’s an extraordinarily effective conductor of heat, aluminum usually makes for a poor insulator. Vinyl manages to combine the best of both worlds—the look of wood and the durability of aluminum. It’s perhaps no surprise that, as Eldredge points out, “vinyl windows are increasingly the go-to choice.” A popular option from Sears Home Services, Weatherbeater vinyl windows require little more than occasional cleaning. Of course, nobody likes cleaning windows, but some—Weatherbeater included—facilitate the dreaded chore with tilt-in sashes that provide easy access to the exterior glass. Once you eliminate what was always the trickiest part of doing it the old-fashioned way, “window-cleaning gets a whole lot easier,” Eldredge says.

 

SAFETY & SECURITY

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You may live in an area where break-ins are rare, but it’s comforting to know your home can defend against would-be intruders, if necessary. “The trouble is that not every homeowner feels that way,” Eldredge says. Perhaps as a consequence, many customers who decide on window replacement do so for a simple reason—”they want to feel safer,” Eldredge says. In assessing the safety and security features of any given replacement window, “start with the hardware, including the locking mechanism,” Eldredge says, “but don’t ignore the glass.” Some types of glass are tougher than others. Upon impact, a traditional window shatters all too easily, leaving a gaping hole. But thanks to an interlayer of polyvinyl butyral (PVB), security glass boasts enhanced strength. You may need to ask for it; security glass typically doesn’t come standard. For example, among the window offerings from Sears Home Services, only the Weatherbeater Max line includes security glass. But while it may not be the right choice for everyone, there’s good reason to consider it if you’re concerned about crime or windblown debris in a storm.

 

Many pursue window replacement only once, if at all, in their tenure as homeowner. Unfamiliar territory for most, window replacement tends to provoke no small amount of anxiety. It’s a significant undertaking, both in terms of scope and consequences, and there are significant costs involved—not least because for all but the most ambitious do-it-yourselfers, the project entails hiring a pro. You can start by soliciting estimates from reputable contractors in your area—it’s never too early. Or, to explore your options further, you can go online now to schedule a free in-home consultation with Sears Home Services. Operating nationally, with a decades-long track record of success, Sears matches you with an expert coordinator, ready to walk you through the entire process, from the earliest stage of selecting a window to the final installation. Best of all, unlike local outfits, Sears provides a Satisfaction Guarantee. When you’re dealing with a component of your home as critical as its windows, it means a lot to work with a trusted brand. As Eldredge puts it, “There’s nothing like peace of mind.”

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17 Guest Security & Safety Tips for Your Vacation Home Rental Property

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BY TREY DULING

If you are planning on renting out your vacation home property in Orlando or any other major city, the safety and security of your guests should be planned for.

Not only will you be able to attract more guests if your property can boast various security measures, but your guests will feel and be safer during their stay.

Even if your vacation home is in a very safe neighborhood, there are some common sense security precautions that you should take.

17 Guest Security & Safety Tips for Your Vacation Home Rental Property

Security Tips                                                    

1. Your front and rear doors should be solid wood or steel, with high-quality doorknobs and locks — as well as a deadbolt on the interior side. If the door is flanked by decorative glass panels, make sure they are shatter proof. Choose front and rear doors with peepholes and sturdy door chains.

2. All windows should have locks and be easy to open and close in case the guest needs to exit the house in an emergency, such as a fire. Impact-resistant windows in heavy-duty frames are nice to have during the hurricane season! Window protection film can also help prevent glass from shattering.

3. Install LED lighting along sidewalks, your garage, and the front and rear doors. Ideally, these lights should turn on automatically at dusk and turn off at dawn.

4. Have interior lights on timers so that they come on as dusk falls (at varying times) over the course of seven days. Make sure guests know that the lights are on timers so they won’t be surprised to come home to a fully lit house.

5. Install visible security cameras by front and back entrances and the garage. These will deter burglars and may also record any accidents, such as someone tripping and falling, as they come up the stairs to the front door. (Note that interior cameras are illegal.)

These visible security cameras must be working cameras! Dummy cameras do not do you or your guests any good. If the home is burglarized while it’s being rented, you may well be sued if the cameras were fake and thus did not capture images of the thieves.

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6. If you have a garage, install an automatic garage door opener and make this available to your guests. Inside the garage, hang a tennis ball or some other item a few feet from the back wall to aid people in pulling in and out safely!

7. Install a security alarm. Investigate the best system for your property, as you’ll want your guests to be able to use it easily and not set off an alarm accidentally. Make sure they know any necessary passwords (and change these for each guest).

8. Consider installing a safe — and describe this in your home description. Obviously you want to emphasize that the home is in a good neighborhood, but offering a safe for the convenience of guests might attract those who like to bring jewelry with them on their travels.

Leave information about all the security features in your guest information notebook for your visitors.

Guest Safety Tips

9. Install smoke detectors in every bedroom and on every floor and, of course, in the kitchen of your vacation rental home.

If your home was built before 1991, the building code does not require that you have a smoke detector in every bedroom — but it’s just a good idea to have them!

Change the batteries on a regular basis.

Make sure instructions for how to turn off an inadvertent smoke alarm are in your guest information notebook. Every smoke detector is a little bit different, and it can be very frustrating for people trying to turn one off if they don’t know how it works.

10. Supply a fully-charged fire extinguisher for the garage and the kitchen, and again, make sure instructions for how to use it are in the guest information notebook.

11. It is also law in most states that a carbon monoxide detector be on every floor. Carbon monoxide is lighter than air, so it will rise. Place detectors high up near the ceiling, not near the floor.

 

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12. If you have a swimming pool, make sure it has an automatic cover and all necessary safety equipment such as a life preserver and floats for little children.

Make sure you post CPR instructions in a visible place by the pool, as well as emergency phone numbers. Put up a sign saying “No lifeguard on duty, swim at your own risk” just to protect yourself.

13. A list of instructions — such as “Supervise children at all times” and “No running on pool deck” the same kinds of instructions you see at municipal pools — is also a good idea.

Also remember to have the pool cleaned on a regular basis.

14. Install home automation. Guests can forget to turn off the water in the kitchen sink. By installing motion-activated faucets, you can prevent guests from forgetting this important detail and potentially flooding your kitchen.

Motion-activated faucets can also save water.

If lights are motion activated as soon as someone enters any room, from the garage to the bathroom to the bedroom to the living room and kitchen, this will prevent frustration from people trying to find the light-switch in the middle of the night.

15. Place non-slip stickers in all bathtubs and showers. Have plenty of handles as well so people can grab onto one if they do start to fall.

16. Install a new HVAC system. If your HVAC system is over 10 years old, consider installing a new system. The latest systems are energy efficient and can not only keep a home more comfortable, but also save on energy costs.

17. Place instructions for water heaters/HVAC right next to them.

You don’t want your guests to have to try to raise or lower the temperature on your water heater. Place signs with large print right next to it forbidding this practice and giving the phone number of a handyman/caretaker who will make any adjustments if they so desire.

By following these procedures, your guests will enjoy greater safety and security and you will have greater peace of mind.

Home Design Trends to Watch: The Herringbone Pattern

By Melissa Dittmann Tracey, REALTOR® Magazine
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Photo courtesy of Laura AnnDiaz of Laura Diaz’s Photography and Mandie Maguire, Berkshire Hathaway Home Services

By Melissa Dittmann Tracey, REALTOR® Magazine

Herringbone is emerging as the pattern of choice in 2016. Herringbone is the arrangement of rectangles that is so named for its resemblance to the bones of fish.

This pattern is popping up on everything from hardwood floors, kitchen backsplashes and shower walls. It may be subtle or bold.

Mandie Maguire with Berkshire Hathaway Home Services says she’s noticed the herringbone pattern subtly appear on more kitchen marble backsplashes above a kitchen range. Also, in flooring, the herringbone pattern is being used with tile floors to give it a more rustic — even hardwood floor resemblance.

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Photo by Braswell Design+Build – Look for traditional bathroom pictures

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Photo by Neumann Lewis Buchanan Architects – Discover traditional entryway design inspiration

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Photo by Croma Design Inc – Look for contemporary kitchen pictures

 

9 Habits of Highly Organized People

By Danica Rog

We all want to be a little bit more organized.

What causes you stress on the outside – whether a long list of errands or a cluttered home, is what causes frustration and uneasiness on the inside. Research shows that it takes 21 days to form a habit. By following some of these easy ideas for streamlining your life, you could be three weeks away from a brand new, organized you.

9 Habits of Organized People:

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Image: General Assembly

They have a place for everything

Put things where they’re used, not where there is space

When it comes to fighting clutter, the most important thing that organized people do is make room for items in the location they’re used, not where there is space. Stamps stay near the bills in the home office, stain remover stays in the laundry room.

The further your belongings are from where you use them means the more time and effort to retrieve them, and the less likelihood you’ll put them back once they’ve been used. Which is the last thing you want when you already have to pay a cable bill or remove a coffee stain.

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Image: Hannotte Interiors

They use tools

Mental notes are out, day planners are in.

Organized people schedule everything. They map out their days and weeks with calendars, whether online, in a planner, or both. They invest in the time to set a reminder or make a note, freeing up brain space to focus on what’s in front of you.

Going digital? Here’s a list of some great organizational apps.

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Image: Nicole Hollis

They have less

The less there is, the less there is to organize.

It’s that simple. Organized homes aren’t filled with excess towels and sheets, or plates and dishes. They just have washing machines and dishwashers. If you can narrow down to just the necessities, you’re bound to be left only with the items you use regularly and love.

Having less of anything – whether wardrobe, board games, or pantry items, makes for easier choices.

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Image: Domus Nova

They know when to say, “good enough”

They’re not perfectionists, and don’t try to be.

Organization is so often associated with detail-orientation, but the two are not mutually exclusive. Organized people are the ones who are OK with putting slightly wrinkly sheets on the bed. They don’t have a five-star meal on the table each night. They get things done as efficiently as possible, allowing themselves to cut some corners to get to the next task at hand.

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Image: Up Interiors

They put things away

Right away.

Author Gretchen Rubin wrote about her experiences trying to clear clutter and become more organized. Her two biggest successes: the one minute rule, and ten minute tidy-up.

The one minute rule declares any task that can be done in under a minute should be done immediately, from filing a record to hanging up a coat or umbrella. Then, every night before bed, she suggests taking ten minutes to tidy up visual clutter in your home. Can’t commit to ten? Start with five.

Staying on top of things little by little is much easier and rewarding than having to tackle your mess once it’s hit the point of no return.

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Image: AWH Architects

They reevaluate

Often.

Lifestyles (and design styles) change, and the organized person is constantly combing through their belongings and deciding what isn’t needed anymore. In a world where we’re almost always accumulating things, we also have to consciously curate our items.

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Image: Dyer Photo

They say no

And don’t think twice.

The invitation to a last minute happy hour, the extra task at work, the lamp from their mother-in-law. Organized people are OK with saying no to things that risk overloading them, whether physically or emotionally. Because the straw that broke the camel’s back shouldn’t be a lamp you didn’t even want in the first place.

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Image: Mrs. Meyer’s Clean Day

They don’t hide their belongings

Out of sight isn’t out of mind.

The art of being organized isn’t the art of stowing away all of your items. In fact, keeping your belongings in plain sight or easily accessible makes them easier to find, use, and move on from. Keeping all of your possessions in boxes and drawers means more time and frustration spent digging.

Invest in some aesthetically-pleasing storage containers. For the kitchen, they’re great for storing cereals, nuts, and pastas (and making it easy to know when they’re running low). For elsewhere in the home, an assortment of sizes can contain kids toys, beauty accessories, even spare change.

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Image: Indi Interiors

They celebrate big and small achievements

A long list of big tasks is daunting to anyone.

Those who stay organized flourish by putting small, easy tasks on a to-do list. Mixing in simple tasks with difficult ones provides encouragement and shows progress as you make your way through the list.

And when tasks are overwhelmingly large, like doing your taxes or buying a new car, break it down into smaller, more digestible to-dos.

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Image: danielle colding design, inc.

They aren’t easy side-tracked

Notifications off.

Often times, multitasking (or attempting to) leads to less productivity overall. This is especially relevant living in a world where we constantly have a buzzing cellphone in hand and a full email inbox.

Organized people don’t feel the need to answer every email as they receive it. Instead, they ignore or turn off notifications for such distractions, and finish the task they’re currently in the middle of.

A study by the University of British Columbia said the average person checks email 15 times a day. However, the study suggests three times is all we need to keep added stress away and stay on track with other tasks.

What secrets do you employ to stay organized? We’d love to hear from you on social media or in the comment section below!

 

Sanity Check: 5 Numbers to Consider Before You Buy a House

by Anand Chokkavelu

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IMAGE SOURCE: GETTY IMAGES.

On the life decision scale, buying a house is often closer to marriage than it is to the purchase of a car. It can be one of the best decisions you make or something you bitterly curse forevermore.

And like marriage, the rent vs. buy decision is unique to the individual, requires you to try to predict your life for the next few decades, and depends on too many factors to summarize in one article.

But fortunately, with housing there are five fairly simple numbers we can look at to help suss out when buying a home is clearly a bad financial idea. I’ve rank-ordered them, starting with…

1.) Housing (and savings) as a percentage of your income

The first and most important metric to check is whether you can afford it. Duh, right? But believe it or not, too many people mess this up. Instead of thoughtfully considering what they can afford for themselves, they go with whatever their banker tells them they’re approved for. Or blindly buy something comparable to a friend or rival. Big mistake!

What you’ll mostly see online and from bankers is a rule of thumb to keep your housing costs below 30% of your gross income — basically, what your employer reports on your W-2.

Let’s say your job pays you $50,000 a year, or $4,167 a month, and you expect to make at least that much in future years. Using 30%, that means your monthly mortgage and any home equity loans (or rent if you don’t own), taxes, insurance, condo or homeowners’ association fees, and utilities should add up to $1,250 or less.

For context, about half of renters and a third of homeowners with a mortgage fail to get to 30% or less. But please don’t use “Tommy’s mom let him spend 50% of his earnings on a condo” as an excuse to overspend — remember, WAY too many people are pretty darn awful with their money. That’s why the majority of folks who receive Social Security depend on it (vs. income from savings) as their primary source of income.

So if you value your financial independence, get as far under 30% as possible. Under 20% is a tough goal in many housing markets, but if you can achieve that with a 30-year fixed mortgage, you’re probably in really good shape unless your income takes an unexpected hit.

Looking at it another way, here’s your gut check: How much of your gross income are you saving?

The average American saves less than 5% of gross income. The median is likely much worse given that 41% of people don’t even have a $500 emergency fund and that the millennial generation as a whole has a negative savings rate(!).

What should you be saving? At a bare bones minimum, 10% of your gross income (ideally not including principal payments on your mortgage). A gold star if you can get to 20%. Using that $50,000 a year income, 10% puts you at $416 a month and 20% puts you at $833 a month.

If you’re buying a house that has you saving less than 10%, you’re either paying too much for the house or you need to reassess other expenses like transportation, vacations, food, child care, etc. Alternatively, you can think about how you can increase your income without proportionally increasing your expenses. That could include sharing the house with a renter.

Rules of thumb necessarily abstract away from your personal situation. A single person in their 20’s is treated the same as a couple in their 40’s with three kids. And there will always be compelling-sounding, I’m-a-special-flower excuses to put off saving till tomorrow. Regardless, though, living below your means should be an always-on phenomenon and the 10% savings minimum holds. That’s even more so the longer you wait.

 

2.) Price-to-rent ratio

While your housing costs as a percentage of your income helps you figure out if you’re spending too much on housing, it doesn’t tell you whether you should be renting or buying.

The price-to-rent ratio helps here.

Simply take the price of the house you’re looking at and divide it by what you could rent it for on an annual basis (Sites like Zillow can help you get a ballpark estimate quickly).

If a house costs $200,000 to buy and you could rent it for $12,000 annually ($1,000 a month), the price-to-rent ratio is 16.7.

Put another way, it would take 16.7 years’ worth of rent to buy the house in cash today.

I used this example because monetarily that 16.7 figure is roughly the indifference point between renting and buying. When you get much lower than 16.7, buying becomes more attractive. When you get much higher than 16.7, renting becomes more attractive.

Don’t get too carried away with the decimal places, though. There are many more financial and non-financial factors to consider, so 18.2 doesn’t mean an automatic rent and 13.7 isn’t an automatic buy. But at some point, the numbers get compelling. For instance, at 10 times rent, I’d be very tilted toward buying. At 25 times rent, I’d be very biased toward renting.

What might surprise you is the variability of the price-to-rent ratio, both across the nation and within metropolitan areas.

SmartAsset recently compiled the ratio by U.S. city. San Francisco tops the list at an otherworldly average of 45.9, over seven times higher than Detroit at 6.3.

If you live in high price-to-rent cities like San Francisco, New York, or my home area of Washington, DC, extreme caution is warranted if you choose to buy. Fortunately, even in these areas, there’s a lot of variability. In these “sellers’ markets,” you may have to use bargain hunting tactics — trolling less desirable areas, foreclosures/short sales, extreme patience — just to get to a somewhat reasonable price. Or you may be better off renting. Nothing wrong with that… and don’t let anyone socially pressure you otherwise.

3.) Size of your down payment

Mortgage is just a fancy name for debt — usually the largest debt we’ll take on in our lives. Fortunately, the larger the down payment, the less scary that debt becomes – for both you and your lender.

That’s why lenders require you to pay private mortgage insurance (PMI) of as much as 1.5% of your original loan amount per year until your skin in the game (i.e. equity) reaches 20%.

Not paying that extra fee alone is reason enough to do a 20% down payment. But also remember that you’re committing to 360 months of payments, so saving up 20% of the price of the house helps ensure you have the discipline to see it through, is a check against buying beyond your means, and is just a smart, conservative thing to do.

In fact, in an ideal scenario, you save at least 30% of the price of the house — 20% for the down payment and 10% as a cushion against unexpected expenses. A leaking roof or an unexpected electrical problem can eat into that cushion quickly.

On a $200,000 house, that means saving $40,000 for a down payment and an additional $20,000 as a cushion beyond your regular emergency fund.

If you think a 20% down payment plus a 10% emergency cushion is too onerous, consider that in the early 1900’s, down payments of 50% were commonplace. That’s $100,000 on a $200,000 house.

I’ll end this section with one real-world consideration that muddies the waters a bit. Folks who have a hard time saving for a down payment probably are poor savers in general. Those are also people who are often saved in retirement by the home equity they’ve built up for decades.

What this means from a practical standpoint for folks who have a hard time saving is that if you limit your housing costs to a low percentage of your income and ensure that your price-to-rent ratio is also low, it may make sense for you to buy with a lower-than-recommended down payment. You’ll want to make darn sure that you have a good 10% emergency cushion in any case, though. It doesn’t do any good to “buy” a house only to have the bank take it back from you in a few years.

4.) What’s the least amount of time you’re committed to staying in the house?

The longer you stay in a house, the more advantageous it is versus renting.

If you stay the full term, you’re locking in your mortgage payment against 30 years’ worth of inflation.

Meanwhile, every time you sell a house, you’re paying something on the order of 6% of the house price to real estate agents and then another 2% to 5% in closing costs. Not to mention any moving costs and potential double mortgage payments during the transition.

All-in, we’re talking something in the neighborhood of 10%, so $20,000 on a $200,000 house. That’s roughly as much as a late-model used car, five to 10 fantastic vacations, or maxing out your 401(k) for a year.

Also, on a 30-year fixed mortgage, you’re mostly paying interest in the early years. When you get a new mortgage or refinance, you reset the timeline.

For these reasons, a lot of people use five years as the minimum you’d want to stay in a house you buy. That’s not an awful rule of thumb, but I’d likely push for an even longer time period.

Let’s say a couple I’m friends with is in the market for a house. Let’s say further that they know for a fact they are going to sell the house in five years — either because it’s a starter home or otherwise. Unless the price-to-rent ratio is amazingly low, I’d ask them to really think about whether the costs, risks, and pain of owning a house are worth it versus just saving up more money to buy when they’re ready to fully commit.

At 10 years, I get much more bullish on buying.

There is an exception and a caveat, though.

The exception: If you are willing and able to rent out your house to cover your mortgage, insurance, taxes, homeowner fees, maintenance, and any property management costs, it could make sense to buy at five years or even fewer.

The caveat: We’re all pretty bad at predicting our futures, even five or 10 years hence. Just be as honest as possible with yourself based on your history and really consider worst-case scenarios.

5.) Your credit score

Here’s one a lot of people don’t consider. For obvious reasons, lenders give lower interest rates to people who have a strong history of paying back what they owe. On a mortgage, the difference can currently be as much as 1.5%.

On a $200,000 house with 20% down, that means someone with a credit score of 740 or higher (850 maximum) could save about $140 a month versus someone with a low-but-approvable credit score. $140 a month may or may not sound like a lot to you, but that’s a whopping $50,000 discount over the life of a 30-year mortgage.

For that reason, it may make sense to delay a home purchase until you can get your credit score to 740 or above. On a more game theory note, if you’ve had poor credit in the past, you may want to prove to yourself that you can handle a mortgage. Living with foreclosure constantly hanging over your head isn’t the American Dream.

Good luck!

Could you come out ahead buying a house that costs you 50% of your gross income, that’s 30 times a comparable annual rent, and that sports a 5% down payment? Absolutely. And you could win a million-dollar game of Russian roulette, too.

But I wouldn’t advise it.

Getting safely on the right side of each of the five numbers we’ve discussed above — especially the first two — will get you far in disaster-proofing your housing decision.

I wish you all the best as you weigh the options. If any of the above helped you in your housing decision or if anything above could be better, I’d love to hear from you on Twitter.

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10 Cool DIY Bookcase Ideas That Won’t Break The Bank

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If the collection of your books needs to be housed in a bookcase then you can make a bookcase yourself too. There are many materials and items you can use or recycle to create a cool bookcase that will not only store and display your books, but will decorate your home too. Along with that we have discovered such bookcase ideas that call for less money. Take a look:

1. Stack Old Wooden Crates and Build a Bookcase

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Image via: tara michelle interiors

2. Recycle an Old Ladder and Give It a Second Life

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Image via: tara michelle interiors

3. Install Ledges on a Wall to Become a Bookcase That Won’t Require Too Much Material to Build

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Image via: two plus cute

4. Re-think an Old Door And Turn Trash to Treasure

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Image via: the elliott homestead , etsy

5. Give a Makeover to An Old Dresser

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Image via: viral upcycle

6. Re-imagine a Cable Reel into a Bookshelf

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Image via: lucht adoption

7. Get Creative with Plumping Pipes

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Image via: pinterest , charliestine

8. Re-purpose Old Drawers and Employ Them as a Bookcase

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Image via: indulgy , pinterest

9. Build a Bookcase from Recycled Pallet Wood

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Image via: pinterest , pinterest

10. Show Off Some Creativity with Old Table Legs

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Image via: layla grayce

5 Must-Know Tips for Selling Your Home

By Winnie Sun

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Selling your home is a big decision that requires significant preparation, including listing your property and meeting with potential agents. Once you’ve done that, it can still take weeks or even months to find a buyer, depending on the market.

With all that in mind, it’s important to know the current best practices for selling your home. Following these five tips will lead to a better experience.

1. Spruce up your online listing

A recent National Association of Realtors study found that nearly 90% of homebuyers use the internet to house hunt. If your online listing is drab and uninviting, you’re already turning off potential buyers. Start by updating it with clear and colorful images of your property. You could even get creative and post a love letter video about your home on YouTube. If you really want to use technology to your advantage, consider renting a drone camera and filming a video that gives potential buyers a 360-degree view of your property.

Remember, you only have one chance to create a good first impression. Helping potential buyers envision themselves living in your home gets you that much closer to selling your property.

2. Shop around for a solid real estate agent

Finding a capable agent is just as important as marketing your home. Try out a few of your options by attending open houses and observing how the agents interact with guests. Do they actively engage the visitors? Are they organized, and do they have support from team members?

You can also ask successful sellers to recommend their listing agents, and let’s not forget the power of online review sites, which can be good tools for finding reputable agents.

3. Negotiate the commission

Once you’ve selected an agent, it’s important that you negotiate the commission. Most realtors charge around 6% of the sale price. But let’s say you’re trying to sell a property in Silicon Valley, where many homes are only on the market for a week or so. You could negotiate a lower commission based on the fact that houses tend to sell more easily in that area.

Research the underlying benefits of selling a property in your area and use this information to negotiate the commission. Six percent represents a big bite out of your proceeds. Don’t hesitate to try to cut a deal.

4. Keep your agent on track

From day one, it’s essential that you establish tasks and timelines for your agent, both verbally and in written agreement. Then make sure that he or she is on track at all stages of the selling process, whether that’s organizing open houses or advertising your property through social media. He or she is your employee, and the last thing that you want is miscommunication.

I have an acquaintance whose agent sneaked away on vacation without warning after setting up an open house. Prospective buyers quickly lost interest when the agent wasn’t around in the following days to answer questions, and the house took awhile to sell. Don’t let this happen to you.

5. Select your buyer wisely

As a seller, you get to choose who buys your house. Remember, this is a business decision — it’s not just a matter of liking the potential buyer personally. For that reason, it’s wise to choose buyers who are preapproved. These buyers have the backing of their lenders to complete a sale, meaning their credit reports and income tax returns have already been checked out, lessening the chance that a financial snafu will throw off the sale process. You shouldn’t dismiss an unapproved buyer immediately, but it’s best to lean toward those who are preapproved.

Selling your home is no simple feat. Always take the time to sort out your options. Happy selling!

How to Flip a House (and How Much Money You Can Make)

By Margaret Heidenry

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Stephan Zabel/iStock

Ah, the house-flipping dream. Buy a run-down home, fix it up, put it on the market—and profit, big-time! Flipping may have hit its peak in the bubble years leading up to the 2007 housing market crash, but this is one dream that definitely hasn’t died. However, just because you’ve watched a lot of HGTV doesn’t mean that you know how to flip a house.

Earlier this year, RealtyTrac reported that homes flipped in the first quarter of 2016 had yielded the highest average gross flipping profit—the difference between the purchase price and the flipped price, not counting renovation expenses—in 10 years. The magic number: $58,250.

But just how much money you make will hinge on taking the right approach—so be sure to check out these pointers on how to flip a house. For real.

How to find a worthy house to flip

“Stick with the age-old adage of buying the cheapest home in the nicest neighborhood,” says Eric Workman, senior vice president of marketing at Chicago-based Renovo Financial, a private lender specializing in the house-flipping space. But don’t pick just any old shack—look for a home with  “good bones,” Workman says. Translation: one that’s structurally sound, has a decent roof, newer windows, and an HVAC system that’s less than 10 years old, as well as modern electrical and plumbing.

Next, a flip should need only cosmetic changes such as new cabinets, countertops, flooring, and paint.

“These renovations can usually be done without the delays of permits, plus the upgrade costs will be relatively fixed, helping to eliminate unforeseen expenses,” says Workman. And always look for homes in neighborhoods close to public transportation or in good school districts as they tend to sell quickly.

How much should you pay for a house you’ll flip?

Your goal should be to make a 10% to 20% return on your investment. So how do you crunch the numbers? For starters, find out what your fixer-upper will sell for once you’re done with it by looking at the sales price for similarly sized homes in the same neighborhood that are move-in ready, says broker Bobby Curtis at Living Room Realty in Portland, OR.

Let’s say, for instance, that homes in tip-top shape in the area sell for $300,000. To get a ballpark figure for a run-down house, cut that price by three-quarters (75% of $300,000 = $225,000). Then subtract the cost of repairs (if repairs cost $30,000, that would be $225,000 – $30,000 = $195,000). That’s about the most you should pay for your flipped house without cutting too much into your profits.

As for financing a flip, it isn’t that different from buying a regular home. You’ll either pay cash or take out a mortgage—just consider going for a 10- or 15-year mortgage, which will offer a lower rate. After all, odds are you won’t own this home for long anyway.

How fast should you flip?

Don’t kill yourself (or more accurately, flip yourself into an early grave) to rush the flip. But also note, you don’t want this house sitting around for long. Curtis recommends looking for a place that will take four to six weeks to renovate. A short deadline ensures you’ll buy and sell the house in that same housing market. Plus, owning a house for less than two months keeps costs like interest and taxes at a minimum.

This means that finding contractors who do quality work quickly is key to your success. For that reason, it’s crucial that you do your due diligence before you hire one: Make sure to meet with at least a few contractors, get their license number, references, and an estimate of what they think renovations will costs. Keep an eye out for red flags—e.g., contractors who ask for money upfront or in cash aren’t playing by the usual rules, and might be trying to take your money and run.

That said, you should accept the fact that the cost of repairs will almost always run over. As such, “you absolutely, positively must overbudget” so you have a financial cushion for those inevitable cost overruns, says Joseph Chiera of The Realty Cousins of Poughkeepsie, NY. Design backups will also help with budget shortcomings.

“If you’re planning to use high-end hardwood flooring priced at $5 per square foot, have a nice backup at $2 per square foot.” Here’s a list of renovations and how much they pay off at resale.

 

What to Do After Inheriting a Home

The idea of owning another home may be attractive, but does it make financial sense?

By Kristin McFarlanddownload
Before deciding to keep an inherited home, take a close look at the other issues and financial questions involved. (GETTY IMAGES)

Receiving an inheritance is often an emotional experience. Inheriting property, such as the family home or a vacation home can be especially trying, as you weigh decisions that have both emotional and practical considerations.

It is also common for the remaining parent to leave a house to all of their children. Depending on the family dynamic and the varying wishes for the property, it may be more difficult to reach a consensus.

 

Selling an inherited home. As you consider the option to sell the inherited property, it is important to understand how the transaction will be taxed. When you inherit property such as a home or vacation home, the basis for tax purposes is the market value at the date of death. This stepped-up value is always considered long term for capital gains taxes. If the property is subsequently sold for more than the stepped-up basis, the gain will be taxed at long term capital gains rates.

If the property is later sold at a loss, it will likely be considered a capital loss. Up to $3,000 in capital losses may be deducted against your income each year, but the balance may be carried forward to future years. It is advisable to consult a tax professional for specific advice related to your situation.

Benefits of selling an inherited home. Each family will have different reasons for deciding to keep or sell inherited property. For many, the benefits of selling the house are as follows:

  • Affordability: Most individuals cannot afford to suddenly take on another home. Even if the home is paid off, there are the costs of insurance, real estate taxes and maintenance. If the home has a mortgage the analysis becomes more complex. Although relatives are allowed to keep the existing mortgage, how you plan to use the inherited property (e.g. as a rental) may require you to get a new mortgage or refinance.
  • Protect gains: Due to the favorable step-up basis for tax purposes, your tax exposure may be limited if the sale is made rather quickly. Real estate markets can be volatile, so it may make sense to sell after consulting a real estate agent.
  • Diversify for other goals: Owning and maintaining inherited property is not typically a financial goal for many individuals. Using the proceeds from the sale to fund other goals, such as retirement, education, or a bucket list vacation, eliminates the market risk of holding real estate while saving for your other objectives.
  • Preserving family relationships: Sharing a home with adult siblings doesn’t always work out the way it was intended. Large income disparities between siblings may create conflict as unexpected expenses arise and cannot easily be paid for. Compromise can be challenging when negotiating use of the home over desired vacation times. The burden of managing the property is likely to rest on one person. If no one is willing to step up, it may be best to sell.
Keeping an inherited home. Although the decision to keep an inherited home is most often made for purely emotional reasons, that alone doesn’t make it an unwise choice. Individuals with greater financial resources may be able to keep the family home in the family, without a measurable impact to their overall situation. Further, some beneficiaries may jump at the chance to raise their family in the house they grew up in.

Before deciding to keep the house, take a close look at the other issues and financial questions involved. What will your mortgage be? What are the taxes, insurance, and maintenance costs? What is the real estate market like in the area? Will you rent the home or use it? Do you live close enough to handle ongoing maintenance or will you need to hire someone?

If you plan on owning the home with other family members, try to evaluate it like any other business decision. Should someone’s financial situation change – will another family member buy them out or will you sell the property (perhaps at a loss)? Who will be responsible for the upkeep of the property? How often will each person wish to use the home? If you would like to use the property as a vacation rental to help offset the expenses, who will be responsible for the logistics?

When multiple beneficiaries (usually siblings) inherit a home, there’s often mixed consensus about what to do with the property. Most commonly, one sibling will buy the others out. This is much easier to facilitate if you have the cash on hand to do so. If not, you will likely need to explore a cash-out refinance if there is sufficient equity in the home.

A cash-out refinance will turn the home’s equity (current market value less the mortgage balance) into cash, which will be used to buy out the other beneficiaries. The equity you receive in cash will be added to the existing mortgage and refinanced. This leaves buyers with a much larger mortgage payment.

If you find yourself struggling to convince your practical side of the merits of keeping the home, take a step back and ask yourself:

  • Would I like to own a home in this location at this price point if it were not passed down to me?
  • Would I go into business with my co-beneficiary family members?
  • Do I have sufficient cash flow or other liquid assets to cover the additional ongoing expenses and maintain a safety margin?
  • How will owning this home impact my lifestyle, both financial and otherwise?
  • What is my short and long-term plan for this property?
  • Will using the home as a rental be worth the additional wear and tear?
  • Has the real estate market in the area been relatively stable? Do you expect prices to rise considerably in the future?
Benefits of keeping an inherited home. The reasons for keeping an inherited property will vary for each person. While keeping the home in the family is usually the desired outcome, it isn’t always an option financially. Assuming it fits into your overall financial picture, there are some benefits of keeping the home:
  • Nostalgic reasons: After the passing of a loved one, it is difficult to deal with the inevitable changes. Keeping the property in the family may help preserve your memories and provide comfort during this time.
  • Investment: Depending on the location and condition of the property, it could be a good investment if the local real estate market is strong. Although you will owe capital gains taxes on the gain when you sell down the road, the stepped-up basis will help to limit the tax liability.
  • Legacy: Some homes have been in the family for generations. Continuing the tradition may be an important estate planning goal.
Inheriting the family home often sparks mixed emotions. Take your time when making the decision – there’s a good chance you may go back and forth a few times. Your financial advisor can help you with the affordability aspect, but you and your family will need to make sense of the emotional side of the decision, undoubtedly the hardest part.