Follow these seven strategies to get the most financial gain on your kitchen remodel.
Homeowners spend more money on kitchen remodeling than on any other home improvement project. And with good reason: Kitchens are the hub of home life and a source of pride.
A significant portion of kitchen remodeling costs may be recovered by the value the project brings to your home. A complete kitchen renovation with a national median cost of $60,000 recovers about 67% of the initial project cost at the home’s resale, according to the "2015 Remodeling Impact Report" from the NATIONAL ASSOCIATION OF REALTORS®.
The project gets a big thumbs-up from homeowners, too. Those polled in the "Report" gave their new kitchen a Joy Score of 9.8 -- a rating based on those who said they were happy or satisfied with their remodeling, with 10 being the highest rating and 1 the lowest.
To maximize your return on investment, follow these seven strategies to keep you on budget and help you make smart choices.
1. Plan, Plan, Plan
Planning your kitchen remodel should take more time than the actual construction. If you plan well, the amount of time you’re inconvenienced by construction mayhem will be minimized. Plus, you’re more likely to stay on budget.
How much time should you spend planning? The National Kitchen and Bath Association recommends at least six months. That way, you won’t be tempted to change your mind during construction and create change orders, which will inflate construction costs and hurt your return on investment.
Some tips on planning:
Study your existing kitchen: How wide is the doorway into your kitchen? It’s a common mistake many homeowners make: Buying the extra-large fridge only to find they can’t get it in the doorway. To avoid mistakes like this, create a drawing of your kitchen with measurements for doorways, walkways, counters, etc. And don’t forget height, too.
Think about traffic patterns: Work aisles should be a minimum of 42 inches wide and at least 48 inches wide for households with multiple cooks.
Design with ergonomics in mind: Drawers or pull-out shelves in base cabinets; counter heights that can adjust up or down; a wall oven instead of a range: These are all features that make a kitchen accessible to everyone — and a pleasure to work in.
Plan for the unforeseeable: Even if you’ve planned down to the number of nails you’ll need in your remodel, expect the unexpected. Build in a little leeway for completing the remodel. Want it done by Thanksgiving? Then plan to be done before Halloween.
Choose all your fixtures and materials before starting: Contractors will be able to make more accurate bids, and you’ll lessen the risk of delays because of back orders.
Don’t be afraid to seek help: A professional designer can simplify your kitchen remodel. Pros help make style decisions, foresee potential problems, and schedule contractors. Expect fees around $50 to $150 per hour, or 5% to 15% of the total cost of the project.
2. Keep the Same Footprint
Nothing will drive up the cost of a remodel faster than changing the location of plumbing pipes and electrical outlets, and knocking down walls. This is usually where unforeseen problems occur.
So if possible, keep appliances, water fixtures, and walls in the same location. Not only will you save on demolition and reconstruction costs, you’ll cut the amount of dust and debris your project generates.
3. Get Real About Appliances
It’s easy to get carried away when planning your new kitchen. A six-burner commercial-grade range and luxury-brand refrigerator may make eye-catching centerpieces, but they may not fit your cooking needs or lifestyle.
Appliances are essentially tools used to cook and store food. Your kitchen remodel shouldn’t be about the tools, but the design and functionality of the entire kitchen.
So unless you’re an exceptional cook who cooks a lot, concentrate your dollars on long-term features that add value, such as cabinets and flooring.
Then choose appliances made by trusted brands that have high marks in online reviews and Consumer Reports.
4. Don’t Underestimate the Power of Lighting
Lighting can make a world of difference in a kitchen. It can make it look larger and brighter. And it will help you work safely and efficiently. You should have two different types of lighting in your kitchen:
Task Lighting: Under-cabinet lighting should be on your must-do list, since cabinets create such dark work areas. And since you’re remodeling, there won’t be a better time to hard-wire your lights. (Here’s more about under-cabinet lights.) Plan for at least two fixtures per task area to eliminate shadows. Pendant lights are good for islands and other counters without low cabinets. Recessed lights and track lights work well over sinks and general prep areas with no cabinets overhead.
Ambient lighting: Flush-mounted ceiling fixtures, wall sconces, and track lights create overall lighting in your kitchen. Include dimmer switches to control intensity and mood.
Related: How to Choose the Best Bulb for the Job
5. Be Quality-Conscious
Functionality and durability should be top priorities during kitchen remodeling. Resist low-quality bargains, and choose products that combine low maintenance with long warranty periods. Solid-surface countertops, for instance, may cost a little more, but with the proper care, they’ll look great for a long time.
And if you’re planning on moving soon, products with substantial warranties are a selling advantage.
Storage will never go out of style, but if you’re sticking with the same footprint, here are a couple of ideas to add more:
Install cabinets that reach the ceiling: They may cost more — and you might need a stepladder — but you’ll gain valuable storage space for Christmas platters and other once-a-year items. In addition, you won’t have to dust cabinet tops.
Hang it up: Mount small shelving units on unused wall areas and inside cabinet doors; hang stock pots and large skillets on a ceiling-mounted rack; and add hooks to the backs of closet doors for aprons, brooms, and mops.
Related: Storage Options that Pack More Space in Your Kitchen
7. Communicate Clearly With Your Remodelers
Establishing a good rapport with your project manager or construction team is essential for staying on budget. To keep the sweetness in your project:
Drop by the project during work hours: Your presence broadcasts your commitment to quality.
Establish a communication routine: Hang a message board on site where you and the project manager can leave daily communiqués. Give your email address and cell phone number to subs and team leaders.
Set house rules: Be clear about smoking, boom box noise levels, available bathrooms, and appropriate parking.
Be kind: Offer refreshments (a little hospitality can go a long way), give praise when warranted, and resist pestering them with conversation, jokes, and questions when they are working. They’ll work better when refreshed and allowed to concentrate on work.
Total Unit Sales may be different on the Housing Trend than the Total Sale on the Housing Stats because these numbers reflect when "SOLDS" are reported. Agents are required to report "SOLDS" in the MLS within 48 hours. When they are not reported on time, the true numbers are not reflected.
Purchasing a home can be a stressful experience, whether you're a first-time buyer or you've been through the process before. But that's one of the reasons that working with a real estate professional is so worthwhile. With your agent's guidance, buying a home should be enjoyable, rather than stressful. Here are some of the more unique circumstances where your agent can make your life much easier.
Out-of-town buyers: If you're looking for vacation homes or moving to a job in a new city, there's a good chance that viewing homes will be difficult-you could be a long drive or even a plane ride away. With today's video messaging apps like Skype or Facetime, your agent can walk you through a property virtually. It's not the same as walking through in person, but it will at least give you an idea about whether a property is worth pursuing further.
When life is just too crazy: If you're just getting too busy with everything else going on in your life, a good buyer's agent should be able to recognize the situation and help you take a step back. They can suggest that you take a few weeks off from your home search to recharge, or only focus on properties that exactly fit your wants list.
Inspection issues: You're dreaming about move-in day, and then some unforeseen issues turn up during inspection. A good agent can work out those issues by negotiating a lower offer-to cover costs of repairs-or by getting the seller to fix the problem.
The acronym "M.L.S." is an everyday term in the real estate industry. So what exactly is the MLS?
On a basic level, the MLS is database of all of the properties available for sale and represented by a real estate agent in a given area. The MLS also creates the framework by which agents agree to cooperate and compensate one another. There is also a high level of supervision by the system administrators, which provides accuracy, professionalism and thereby reducing fraud.
With the emergence of search sites like Zillow, Trulia, and Realtor.com, the consumer has been empowered with valuable information, which is important. The key thing for home buyers and sellers to know is that these sites don't always have the most up-to-date or accurate information.
If you are thinking of selling you will get the most exposure possible by being represented by an agent, who will place your home on the MLS once it is listed with that brokerage. Agents have buyers waiting for new listings to hit the market daily and your home could literally be viewed by thousands of buyers within just a few moments of being put up on the MLS!
If you are thinking about buying, you will find the most up to date listings available in the Kenosha and Racine county areas with us at Cove Realty. Contact us so we can get you set up to receive the latest listings, so you aren't being disappointed when you drive by a home only to find it already has an offer pending on it! Call our office at 262-658-8030 today or drop us an email!
Owning your own home is a big responsibility and at times it can be a lot of work. Fortunately, there are some great tax advantages for owning, in addition to having a place of your own.
1. Mortgage Interest Deduction: This has long been one of the most valuable deductions for homeowners, especially with a new mortgage where the payments consist of mostly interest.
2. Home Improvement Loan Interest: The same way your mortgage interest is deductible, so can be the interest on a home improvement loan. Consult your tax advisor because some wear and tear items such as carpet and paint may not qualify.
3. Mortgage Points/Origination Charges: These charges are treated similar to interest on the loan, making them deductible. Consult your tax advisor because the deduction is treated differently depending on if the charges were for a refinance or a purchase.
4. Energy Efficiency Upgrades: Up to 10 percent of the improvement cost can be applied as a tax credit, which is a direct reduction in the amount of tax you owe. There are a wide variety of items such as energy efficient appliances, furnaces, insulation, and windows. Be aware that this credit does max out at $500.
5. Capital Gains Exemption: If you were to sell a home and realize a profit you can claim that profit tax-free. Be aware there are many requirements for the exemption, such as the home must have been your primary residence for 2 out of the last 5 years.
Few things in the home buying process are more frustrating than having your offer accepted, only to have the appraisal fall below your offer. But all is not lost! If the appraisal comes in below your offer, there are several tactics and strategies that can lead to a happy solution.
Get a second opinion: There's no need to take the appraiser's estimate as fact. You can pursue a value appeal, or you can discuss a second appraisal with your prospective lender. Sometimes you can even get the seller to pay for the second appraisal, because they will be motivated to complete the sale. Your real estate professional should be able to help you through the process of an appeal or a second opinion.
Renegotiate for a lower price: Unless the market is extremely hot, there's a good chance the seller can be talked down to the appraised value. Sellers often prefer to complete the deal, rather than putting the property back on the market.
If all else fails, resist the urge to pay more: Sure, paying more in cash to cover the difference between the loan amount and the agreed upon sale price is tempting. Buying a home is an emotional experience, and you may think that this particular home is the only one that you'll be satisfied with. Take a step back and consider searching for another property.
The start of the year ushered in a wave of good news about a hot stock market,higher wages and an active home sales environment. At the same time, housing prices have continued to rise, and the low inventory situation and affordability crunch has been particularly hard on first-time buyers struggling to get into the market. Nevertheless, buyer activity is easily outpacing seller activity in much of the country, culminating in relatively quick sales and low supply. Demand definitely remained strong this month.
New Listings in the Milwaukee region decreased 3.7 percent to 1,783. Pending Sales were down 50.5 percent to 648. Inventory levels fell 12.1 percent to 4,820 units.
Prices continued to gain traction. The Median Sales Price increased 4.3 percent to $182,000. Days on Market was down 19.6 percent to 78 days. Sellers were encouraged as Months Supply of Inventory was down 13.9 percent to 3.1 months.
Unemployment has reached pre-recession levels, and Americans remain optimistic about finding quality employment. This matters because job growth and higher paychecks fuel home purchases. Unfortunately, that won't matter for potential buyers if price appreciation outpaces income growth and if mortgage rates continue their upward trend. Sellers are getting a generous number of
offers in this market. The worry for sellers then becomes that there will not be generous number of homes to choose from when they become buyers.
All data for the market reports comes from the Multiple Listing Service, Inc. and is powered by 10K Research and Marketing.
With low inventory in many markets throughout the country, many homeowners are afraid to sell their homes because they're concerned that they may not be able to find a new one. This can be a real problem, but if you are seeking to sell-whether to upgrade or find a new neighborhood-there are a few ways to combat the low inventory.
Look to buy first In most markets it is a real mistake to put your home up for sale before you start looking for your new property. Identify the geographic area where you are interested in buying. Even if you don't see anything on Zillow, it doesn't mean you can't or won't find the right home.
Think outside the box Be proactive! Keep in mind that there are probably many people like you who want to make a move but are afraid as well. Have your real estate agent send a letter to the neighborhoods in the geographic areas where you want to live. The letter should be heartfelt and personal while announcing that you are ready to buy a home in that neighborhood. You could find a home to buy that may not even be currently listed or for sale.
Protect yourself legally Each state varies in how the purchase process is conducted. Talk to your real estate professional about adding a clause in the purchase contract for the home you are selling that will enable you to not sell the home if you cannot find a suitable home to buy.
When you purchase a home, there's a good chance you'll have to pay a homeowners association fee, especially in gated communities, townhouses, condominiums, and other similar planned neighborhoods. The idea is to keep common areas clean and maintained, and there's usually an HOA board that is responsible for setting the rules and regulations.
Each HOA is different, but most have the same core elements. You'll typically pay your HOA fees either monthly or annually, and it's an important factor to consider when you're weighing your options for a new home. So what is typically included in your HOA fees?
First, the fun stuff Amenities are typically the big perk of living in a community with an HOA. While you lose out on some of the freedom of living without an HOA, you instead get community amenities like a maintained pool, gym, clubhouse, tennis courts, and other amenities. The HOA fees pay for cleaning and maintenance, so-in theory-you'll always have a clean pool whenever you want to use it.
Protecting the community HOA fees often contribute to insurance for the community amenities, as well as a fund for unexpected repairs to damaged community property-think damage from weather or accidents.
General maintenance Your HOA fees will go toward maintaining the general safety and upkeep of the community. This means things like elevator maintenance for condominiums, snow removal, and trash/recycling services.
Be active in the association There may be a board of directors, but homeowners associations exist for the betterment of the entire community, and every voice matters. HOA meetings-and the amenities they support-provide great opportunities to meet your neighbors and make your community a better place.
January brings out a rejuvenated crop of buyers with a renewed enthusiasm in a new calendar year. Sales totals may still inevitably start slow in the first half of the year due to ongoing inventory concerns. Continued declines in the number of homes available for sale may push out potential buyers who simply cannot compete for homes selling at higher price points in a low number of days, especially if mortgage rates continue to increase.
New Listings in the Milwaukee region decreased 7.5 percent to 1,492. Pending Sales were down 45.7 percent to 548. Inventory levels fell 17.7 percent to 4,427 units.
Prices continued to gain traction. The Median Sales Price increased 10.6 percent to $188,000. Days on Market was down 15.1 percent to 73 days. Sellers were encouraged as Months Supply of Inventory was down 19.4 percent to 2.9 months.
In case you missed it, we have a new U.S. president. In his first hour in office, the .25 percentage point rate cut on mortgage insurance premiums for loans backed by the Federal Housing Administration (FHA) was removed, setting the table for what should be an interesting presidential term for real estate policy. FHA loans tend to be a favorable option for those with limited financial resources. On a brighter note, wages are on the uptick for many Americans, while unemployment rates have remained stable and relatively unchanged for several months. The system is ripe for more home purchasing if there are more homes available to sell.
All data for the market reports comes from the Multiple Listing Service, Inc. and is powered by 10K Research and Marketing. You can follow this link: Metro MLS Market Updates or visit www.metromls.com.
If you're interested in selling or looking to buy a new home please contact us at Cove Realty
There’s no more important time to work on your credit score than when you’re about to apply for a mortgage. Improving your credit can save you a ton of money—we’re talking about thousands of dollars over the life of the loan. Here are the actions you can take that will have a notable impact on your score.
Pay down your credit card balances Credit utilization is one of the biggest factors in determining your credit score. Your credit utilization should at least be less than 30 percent of your limit, and it’s even better if you can get it below 15 percent. This rule applies to both individual cards and your overall credit limit.
It may even be worthwhile to use some of the cash funds you were planning to use for a down payment to pay off credit card balances.
Do no harm While you certainly want to improve your score if possible, at the very least you’ll want to keep it steady. Avoid opening new lines of credit if you’re applying for a mortgage in the very near future. This will cause a hard inquiry to show up on your credit report.
Take care of negative items It’s good practice to check your credit report for negative items a few times a year—you can get one free report from each of the three major bureaus (Experian, Equifax, and TransUnion) per year.
If you find any negative items (collections, late payments, etc.), write a letter to the original creditor. Explain the circumstances that led to the negative item, and request that it be removed from your report. It can be surprisingly effective, and removing a negative item will improve your credit score in a hurry. You can find some good templates for a request letter online.
Contact us using the form below if you you have any other questions about buying a home in the Kenosha or Racine County areas!