Archives for February 2012

Transition Years, Part I

Guest Post by Floyd Gibbs, Owner/Senior Inspector, Quality Home Inspections

All homes have pros and cons when it comes to the years in which they were built. Some are subtle, as in aluminum branch wiring in the early 70’s. Others are a little more drastic, such as Quest plumbing in the late 80’s. But there will always be a 5-year period that we must all be aware of—and it changes from year to year.

This period is what I call “Transition Years.”

You see, no matter how advanced we are with elements included in a new home, we still only get between 17 and 23 years out of them. Whether these elements are worn out, inefficient, or just out of style, the standard rule of thumb will always be that hitting a home’s transition period means it’s time to replace them. The list below outlines the major replaceable elements of a home and shows, on average, the percentage of homes that have replaced these elements by the end of the transition years and the cost of those repairs/upgrades.

 

Standard Percentage & Cost of Renovation/Replacement
Roof Covering 100% $6,000.00
HVAC System 100% $5,000.00
Water Heater 100% $1,000.00
Floor Covering 90% $5,000.00
Windows & Doors 80% $5,000.00
Kitchen & Bathrooms 60% $10,000.00
Electrical Devices 50% $2,500.00
Siding & Trim 40% $5,000.00


By now you might be doing the math and realizing that our current transition years are 1989-1995. I know, I know: this doesn’t seem to be OLD, but unfortunately in house years it is. The homes we work with do not have the same flexible youthfulness that we so enjoy from time to time.

The point is that we all must accept that there is and always be transition years for the major elements of the homes we deal with. This poses a unique challenge for me as a positive home inspector and for you, your client’s most important tool in home sales. Buyers and sellers deserve for us to navigate this reality with finesse. Knowledge is and always will be power.

This is part 1 of 4 in the series about a home’s transition years. Next week you’ll learn more about the shocking extra issues that plague this particular 5-year period, and for Week Three, I’ll discuss how this extremely difficult period of transition years is actually an amazing opportunity for every one of you. Week Four will outline future transition year periods to watch out for and the positive spin on each of them.

~Floyd  (QualityInspections@Verizon.Net)

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If you plan to purchase or sell a home in the Hampton Roads, Virginia area,
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Real Estate, Football, and the Power of Momentum

Let’s talk about the New York Football Giants for a minute. Whether you love ‘em or hate ‘em, the Giants completed an unlikely title run this past Sunday by beating the favored New England Patriots to become Super Bowl champions. Punctuated by ups, downs, and one of the more impressive receptions seen in any Super Bowl, the game delivered excitement for the fans and a shining trophy for the team from New York.

(Photo: Associated Press - Pat Semansky)

But how did the Giants end up standing on top of the world?

The progress chart goes as follows:  going into their Christmas Eve game with fellow Meadowlands occupants and cross-town rivals the New York Jets, the Giants were an unimpressive 7-7. Average. Ordinary. 50/50. Historically, numbers like that do not usually indicate a team that is Super Bowl-bound. But because of the likewise lackluster performance by fellow NFC East division teams, it was actually mathematically possible for the Giants to go to the playoffs. To give themselves that chance, though, they had to win the last two games of the season.

Here’s where it happened. The Giants turned their season on its head and beat the Jets (who were fighting for a playoff spot as well). That win brought the Cowboys to town, and whoever won the game, won the division and a spot in the playoffs. Spurred on by the impressive Jets win, the Giants ran all over the Cowboys and claimed the playoff spot.  From that point on, the Giants’ momentum was like a rock rolling down a hill. They trounced Atlanta in the first round of the playoffs. They handed the Packers only their second loss of the entire season. They battled hard against San Francisco and came out on top. Finally, in the Super Bowl, the Giants defeated the New England Patriots, a team that’s been to fully half of the Super Bowls in the last decade (and has won three of them). Every team the Giants beat had a better regular season record than they did.

In short, the New York Giants won the biggest title in football by not letting their prior performance get them down. They committed 100% to winning one game, then the next, then the next, and so on. By working hard, learning from their mistakes, and going all in, they gave themselves momentum and rode that wave all the way to the top.

So after hearing the story, here’s the question:

ARE YOU ALL IN????

Are you like the Giants? Will you let a so-so past performance weigh you down, or are you going to shake off the frustration and make something amazing happen? If you want to be successful, you don’t have time to brood and say, “Woe is me!” So ask yourself:  am I doing what I can every day to improve my performance? There are so many opportunities for you to “turn the season on its head” and find success; for example:

  1. Take advantage of the wide array of training TREG offers—there are classes taking place nearly every business day!—or try something new you learned in a class but haven’t done yet. Keep learning and keep doing.
  2. Commit to mastery of the fundamentals. Fundamentals never change, but in order to master them, you need to dedicate yourself to relentlessly focusing on them. Fundamental #1? There is no new way to throw the football.
  3. Look at your business plan and see if you’ve dropped the ball anywhere; if you have, pick it up and run with it!
  4. Ask yourself if you’re utilizing your Sphere of Influence to its full potential. If not, do something about it.

Often it doesn’t take much to turn the tide, but taking advantage of that turn-around requires an all-in commitment to making things better. You have to fully believe in the eventual reward that comes from doing the hard work of business-building, day in and day out. The only way to feel the power of your own momentum is to get up and get started!

So take a lesson from the Giants: never, EVER let an average day/month/quarter/year get you down. Instead, use it as motivation, and commit yourself to going ALL IN on being a success. Take advantage of resources available to you, build your business, and generate your own momentum. No one else is going to do it for you!

 

Thank you for reading our blog.  If you like what you’ve read, then please :
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If you plan to purchase or sell a home in the Hampton Roads, Virginia area,
you can visit our Hampton Roads Real Estate website at www.RealEstateGrp.com

Owning a Home is Still a Great Idea

A lot of eyes are on the real estate market right now, from economists to politicians, investors to homeowners. Everyone wants to know what’s next, where the market is headed, who’s buying, and what’s selling. The whirlwind of discussion about economic factors and national trends can often overshadow the fact that, quite simply, owning a home is still one of the best investments you can make, both financially and emotionally. There are a number of reasons that support this claim, which can be divided into two categories:

  1. Reasons that have been proven, over time, why it’s good to own a home.
  2. Reasons why now might a good time for you to take the step into home ownership.

Let’s start with several historically sound arguments about the advantages of home ownership. First, the financials:

  • Tax writeoffs. A significant portion of the cost of paying for and owning a home is actually tax-deductible. The interest on your mortgage payments? Deductible. So are the property taxes you pay every year, as are the points you may have paid to bring down your loan’s interest rate (points are, however, only deductible in the year you purchased the home).
  • Access, over time, to equity. As you pay down the balance of your mortgage loan each month, you build equity in your home. This equity can then be used as collateral against a home equity loan or line of credit, which can be tapped for emergencies, remodels, or any time cash is needed.
  • Long-term investment. Notice the phrase “long-term.” According to NAR, since 1968, home prices have grown an average of 5.5% a year, regularly outpacing inflation. For those who plan to be in their homes for many years, the slow growth of the value of the home is considered a solid investment.

Now, the more esoteric:

  • Your home is your canvas. Want pink-and-purple striped walls? You can do that. Think each room should have a different color and feel? Go right ahead. Your home is yours to furnish, decorate, remodel, and alter as you wish—no landlord approval needed.
  • Your home gives you roots. Once you choose a home and make it your own, it becomes part of who you are. Memories are created there. Friendships are formed with neighbors. You become part of the community with your home as your base.

Finally, let’s look at how the current economic situation is providing reasons why now may be a good time to take the home ownership plunge:

  • Historically low mortgage rates. If you have the good financial standing to qualify, mortgage rates right now are unbelievably low. Locking in to one of these very low rates—as of today’s writing, averaging around a 3.85% interest rate on a standard 30-year fixed loan—can save you tens of thousands of dollars over the life of your loan. (Current homeowners should note that it’s also a fantastic time to refinance if you are locked in at a much higher rate.)
  • Low house prices. Along with mortgage rates, housing prices have also tumbled during the recession, causing frustration for sellers but opening up some great opportunities for buyers. Houses that may have been out of reach a few years ago may now fall squarely within your budget.
  • Many choices available. The high number of properties available for sale in our area means buyers have a lot of choices in terms of location, price, and style of home. This availability of choice often gives the buyer some negotiating power when it comes time to make an offer. In some parts of the country, the market is already balancing out, but Hampton Roads still favors the buyer overall right now.

Keep this in mind: all the reasons in the world to buy are invalid if you’re not ready. When contemplating any major life change, always do your research and find out if you’re in a position financially to do so. If you’re not sure where to start, contact a TREG agent. He or she will walk you through the process and help you decide if you’re ready to buy!

 

Thank you for reading our blog.  If you like what you’ve read, then please :
Follow, Connect, Watch, Subscribe
           
If you plan to purchase or sell a home in the Hampton Roads, Virginia area,
you can visit our Hampton Roads Real Estate website at www.RealEstateGrp.com