Family Living in the Sky: North America’s Newest Reality

As land available for new construction shrinks in urban centers across North America, governments, builders, and families are looking upward. Living high in the sky isn’t how many young families would have envisioned the family home, but for many, it’s a reality.

This new reality is playing out in Toronto, Canada, where family-sized condo units are rare. Some 80% of new housing built in the past decade are buildings of five or more stories. Yet fewer than 10% of high-rise homes in the city have three or more bedrooms. And this is presenting a problem for young families who want to live and work there.

According to a recent story in Citylab.com, Toronto is on its way. Guidelines generated in a 2015 study by the city’s Planning Division were adopted this summer by its City Council and will be used in evaluating current and future projects. The guidelines, points out CityLab contributing writer Mimi Kirk, “are not only applicable to Toronto, but to cities across North America and beyond …”

Among the recommendations: 15% of units should include two bedrooms and 10% should include three, with these larger units located on lower levels, close to each other, and adjoining outdoor spaces.

Meanwhile, in New York City, where raising kids in high-rises is nothing new (but not particularly family-friendly), some existing buildings are currently updating and repurposing their amenities, thanks to the growing number of New Yorkers choosing to raise their families in the city.

Maybe life in the sky isn’t such a hardship after all.

NAR Poll: Home Affordability and the American Dream

Do you dream of owning a home someday? If so, you’re not alone. The desire to put down roots and invest in a home is a common one.

And this dream is still strong across North America. The problem is, many can’t afford it.

To many, the dream seems elusive as a result of the significant cost not just of purchasing a home but also in carrying it. Many who would like to and can pursue the dream never will due to fears associated with the lack of affordability (“Will I be in over my head?” “Will I lose money?”).

According to the 2017 National Housing Pulse Survey conducted by the National Association of Realtors (NAR), 84% of Americans view owning a home as “a good financial decision.” And 80% of respondents see homeownership as a way of building equity toward their retirement. As well, 50% believe homeownership is an avenue to a secure neighborhood and a stable family environment. However, the positive sentiments don’t necessarily mean all of these respondents will be home-shopping this year.

Affordability is a concern

Why? Some 60% of those responding to NAR’s survey identify affordability as one of the top five challenges of homeownership. Many also believe the myth that they need significant savings (more than 15%) for a down payment on a home. According to the survey, 69% felt a “reasonable” down payment was 10% or less, while more than 40% believe lenders require down payments of 15% or greater.

That said, the survey itself supports a willingness for people to learn, wait and save – if it means the culmination of their dream.

NAR President Bill Brown, quoted in an article in RISMedia, says: “Despite the growing concern over affordable housing, this survey makes it clear that a strong majority still believe in homeownership and aspire to own a home of their own.”

Millennials’ Homeownership Dreams Can Come True

For many millennials, the dream of homeownership feels far away, if not impossible. Salaries that haven’t grown with the cost of living, new mortgage rules, volatile housing markets, and a plethora of other reasons have made buying a home more difficult than it’s ever been for young people.

A survey by Apartment List of 24,000 American renters found that 80% of millennial renters want to become homeowners, but 72% are held back by affordability. Some 44% don’t have savings to put toward a down payment.

Many who find themselves in that position are trying to reach their homeownership goals with second and even third jobs in order to save extra money. Some are moving to smaller towns where housing is cheaper, while others are living with Mom and Dad in order to save on rent. But Fundrise, a Washington, D.C.-based start-up, has another, more creative solution.

Fundrise is a real estate crowdfunding start-up that sells shares in “eFunds” that build and/or remodel urban housing. An investor can be part of an eFund for $1,000, and the target audience is millennials.

Notes a recent Forbes article on the project: “(T)he goal is for a subset of the fund investors to become owners of the very places their money is helping build. Fundrise calls these ‘homebuyer investors’ or HBIs.”

So if a millennial could invest in a property today, he or she could be taking advantage of gains toward what might eventually become his or her home.

As well, says Forbes writer Samantha Sharf: “Fundrise’s effort is unique in tackling the dearth of affordable supply, which many economist [sic] agree is the biggest issue in the housing market today.”

The Fundrise project launched this past summer, so it’s too early to assess its success in encouraging new supply or in attracting millennials.
But this initiative may soon become one of many – millennials deserve their shot at homeownership too.

How to Cut Your Electricity Bill without Really Trying

It’s fall – a good time to take a fresh look at your bills to see if you can reduce them. For example, try these tips to cut your power usage and lower your electricity bills.

Switch to LED bulbs. About four times more energy efficient than incandescent bulbs, LEDs last for years. The “lumens” number indicates the amount of light emitted; use this to compare bulbs.

Install a programmable thermostat. With this device, you can automatically adjust the temperature to reflect where you are in your day – busy at home, away at work, asleep, etc. It keeps your home comfortable when you’re there and reduces energy use when you’re out.

Unplug unused electrical devices. All electronic devices sip small amounts of electricity even when they are not in use.

Use timers and power strips to turn electrical devices on and off. A power strip with an on/off switch can block the charge going into the strip itself as well as anything plugged into it.

Lower the temperature on your hot water heater. A hot water heater accounts for about 14% of energy usage in a typical home. Turn the temperature down when you’re not at home and up when you’re doing laundry or bathing. You can also install a water heater blanket to hold the heat.

Last but not least, air seal your home to prevent drafts around doors and windows, and ditch that old power-hungry refrigerator in your garage that’s only chilling a few cases of soda.

Now you can relax and enjoy saving!

Rules Differ in a Condo Remodel: Here’s How

You’re ready to renovate. Your creative juices are flowing, and you’re excited to create that perfect space.

But wait. Are you remodeling a condo? If so, this requires some special considerations. The game rules differ from those for a detached home. Here’s the playbook:

Read the regulations: Condos come with associations. These come with rules. The association has put certain standards in place to maintain the best possible conditions for your building. Before forging ahead with any plans, read through the regulations of your association and consult with your board or property manager for anything that will need the association’s approval.

Consider condo limitations: Your unit may be linked to others, so you may not be able to alter certain aspects of your home: plumbing fixtures might have to stay where they are; you may not be able to remove walls that support the structure, or install pot lights in ceilings. But don’t let these limits stifle your creativity or dash your renovation hopes. Just keep them in mind as you plan.

Plan ahead: If your renovations are extensive and the space small, your contractor and workers may require an extra space in which to work. Ask if there is a workshop or outside space they may be able to use.

Don’t fear the painter: One of the easiest (and cheapest) ways to transform a space is by painting it. However, many condo owners are concerned about personalizing their walls, especially with deep, dark colors. Unless you’re renovating for an immediate sale, go ahead and make the space your own. Enjoy it while it’s yours. When you are ready to sell, you’ll likely need to apply a fresh coat of paint anyway, and you can make it neutral then.

Get out: For your own sanity, stay with a friend or relative during construction, or treat yourself to a hotel.

Home Alone: More Women Are Buying Homes on Their Own

“Skip the spouse, buy the house” was a line from a recent Bloomberg news story about single women buying homes on their own. It’s catchy, but also true: as the article reported, single women currently account for approximately 17% of new homebuyers in the U.S., versus 7% of single men.

Why? Despite the wage gaps that remain between men and women in the workforce, many millennial women appear to value homeownership more than their male counterparts do, and are adjusting their lifestyles accordingly to make it happen.

In the Bloomberg article, Daren Blomquist, senior vice president of ATTOM Data Solutions, noted that single women typically buy at a lower price point ($173,000 compared with $190,600) and have a slightly higher foreclosure rate than men (73 per 10,000 vs. 70 per 10,000). This may be a result of the aforementioned gaps in wages, or possibly because more women raise children on their own than men do – a scenario with major financial implications.

Single women homeowners say there’s a sense of independence and a comfort level that comes with owning your space, and that despite the need for often-expensive home maintenance and other costs, homeownership can be personally fulfilling.

For both single men and women, buying one’s own home requires more financial independence than does buying with the support of a partner. It’s essential not only that prospective buyers have a down payment and months of mortgage payments saved, but also that they’re emotionally prepared for the stresses that come with homeownership – and are ready to take them on alone.

Second Mortgages: Make Your Dreams Happen – Carefully

RateHub defines a second mortgage as “an additional loan taken out on a property that is already mortgaged.” Sounds risky – and indeed it comes with plenty of risks. But it also comes with rewards.

There are two major kinds of second mortgages: The home equity line of credit (HELOC) has a variable interest rate and acts much like a credit card, allowing you to withdraw the cash you need, when you need it. And the fixed-rate home equity loan allows you to borrow a lump sum and make set monthly payments.

Second mortgages provide speedy access to money at a generally favorable interest rate – and the interest you pay on mortgages may also be tax deductible. Compared with money borrowed on a credit card or a standard consumer loan, a second mortgage may be easier to obtain, and you can use the money for whatever you want: home remodels, tuition – even a dream trip.

The most important disadvantage: because your home secures the loan, the second mortgage lender takes on less risk than with a personal loan, and may offer you more money than you need. Many borrowers are happy to comply, only to find themselves in trouble.

Ensure you can make your monthly mortgage payments easily, even when interest rates go up or personal circumstances change. And note that if interest rates increase, so will your monthly HELOC payments. Home equity loan payments aren’t affected by rate increases during the term of the loan.

So go ahead and make that bucket-list trip a reality – but plan carefully.

Is Lack of Space Cramping Your Green Thumb?

If your green thumb is out of joint thanks to limited (or nonexistent) outdoor space, try some out-of-the-yard thinking, and you’ll soon be digging in the dirt. You can garden anywhere if you’re resourceful.

Go vertical: If you’re in an urban setting, take inspiration from the high-rises that surround you. When there’s no room to spread out, go up. Use tiered planters and a trellis to create a living wall or a “room” divider on your balcony. Add wall pockets to grow small plants such as herbs. When you think of your outside walls as garden space, you suddenly have lots of room!

Think outside the window box: Who says plants only grow on prairies and in pots? Create a unique arrangement of washbasins, bowls, cookware, repurposed rain boots, previously loved furniture – nothing’s off limits for the innovative container gardener.

Automate it: If you have neither the space nor the green thumb, this solution may be for you. The recently invented Modgarden is a small indoor farm in a cabinet, and it’s fully automated. You simply fill the water reservoir, add seeds, and wait for your veggies and herbs to grow. Some restaurants in colder climes are trying it to grow off-season produce.

Redefine the fruit basket: Fit a large wicker basket with a plant-friendly container filled with potting soil, and add your favorite herb and edible flower seeds. Soon you’ll have a microgarden that’s useful, decorative, and different all in one.

Bring the outdoors in: If you love greenery but lack green space, why not bring the garden inside? Add small potted trees to sitting areas. Integrate potted plants into your décor. Fill your foyer with foliage. You may not have much square footage, but you can transform the space you do have into a garden that flows from room to room. Just remember to provide your plants with the right soil and lighting conditions, water regularly … and enjoy!

Second Mortgages: Make Your Dreams Happen – Carefully

RateHub defines a second mortgage as “an additional loan taken out on a property that is already mortgaged.” Sounds risky – and indeed it comes with plenty of risks. But it also comes with rewards.

There are two major kinds of second mortgages: The home equity line of credit (HELOC) has a variable interest rate and acts much like a credit card, allowing you to withdraw the cash you need, when you need it. And the fixed-rate home equity loan allows you to borrow a lump sum and make set monthly payments.

Second mortgages provide speedy access to money at a generally favorable interest rate – and the interest you pay on mortgages may also be tax deductible. Compared with money borrowed on a credit card or a standard consumer loan, a second mortgage may be easier to obtain, and you can use the money for whatever you want: home remodels, tuition – even a dream trip.

The most important disadvantage: because your home secures the loan, the second mortgage lender takes on less risk than with a personal loan, and may offer you more money than you need. Many borrowers are happy to comply, only to find themselves in trouble.

Ensure you can make your monthly mortgage payments easily, even when interest rates go up or personal circumstances change. And note that if interest rates increase, so will your monthly HELOC payments. Home equity loan payments aren’t affected by rate increases during the term of the loan.

So go ahead and make that bucket-list trip a reality – but plan carefully.

Is Lack of Space Cramping Your Green Thumb?

If your green thumb is out of joint thanks to limited (or nonexistent) outdoor space, try some out-of-the-yard thinking, and you’ll soon be digging in the dirt. You can garden anywhere if you’re resourceful.

Go vertical: If you’re in an urban setting, take inspiration from the high-rises that surround you. When there’s no room to spread out, go up. Use tiered planters and a trellis to create a living wall or a “room” divider on your balcony. Add wall pockets to grow small plants such as herbs. When you think of your outside walls as garden space, you suddenly have lots of room!

Think outside the window box: Who says plants only grow on prairies and in pots? Create a unique arrangement of washbasins, bowls, cookware, repurposed rain boots, previously loved furniture – nothing’s off limits for the innovative container gardener.

Automate it: If you have neither the space nor the green thumb, this solution may be for you. The recently invented Modgarden is a small indoor farm in a cabinet, and it’s fully automated. You simply fill the water reservoir, add seeds, and wait for your veggies and herbs to grow. Some restaurants in colder climes are trying it to grow off-season produce.

Redefine the fruit basket: Fit a large wicker basket with a plant-friendly container filled with potting soil, and add your favorite herb and edible flower seeds. Soon you’ll have a microgarden that’s useful, decorative, and different all in one.

Bring the outdoors in: If you love greenery but lack green space, why not bring the garden inside? Add small potted trees to sitting areas. Integrate potted plants into your décor. Fill your foyer with foliage. You may not have much square footage, but you can transform the space you do have into a garden that flows from room to room. Just remember to provide your plants with the right soil and lighting conditions, water regularly … and enjoy!

Our Future Homes: Easy Care and Open Plan

Thanks to an exhibition organized by Japanese retailer Muji, we can peek into the home of the future. And according to a recent article in Houzz, we can expect to live with new materials, adaptable spaces, and open-concept floor plans.

The exhibition, House Vision 2, introduced the ideas underlying tomorrow’s homes as seen by companies in the housing industry, architects, and designers. Ten life-sized prototypes offered insight into the way housing may go in the future. Here are a few examples:

  • “Open House with Condensed Core” was a collaboration between architect Shigeru Ban and Lixil, a Japanese building materials manufacturer. Their prototype addressed the limitations of traditional plumbing, which make layout changes difficult. In their vision, the plumbing is installed in the ceiling, making it easier to reconfigure. The house also features glass windows that can swing up and out of the way for a truly indoor-outdoor space.
  • Commissioned by Daito Trust Construction, Sou Fujimoto’s installation explored new types of multi-dwelling residences in his “Rental Space Tower.” It rearranges both private and shared spaces of a typical apartment to reduce the square footage of private zones and maximize public areas, creating new shared amenities like libraries and theater rooms.
  • Airbnb and architect Go Hasegawa teamed up on “Yoshino-sugi Cedar House,” a wooden dwelling that brings a new meaning to house-sharing. It’s part community space, part temporary residence, which is used, maintained, and operated by the community, not a private individual. On the first floor are a meeting space and communal kitchen; upstairs are bookable sleeping quarters for guests.

Finally, it seems we don’t have to bid goodbye to open-concept living just yet; open floor plans were featured in many installations. They’ll just look a little different down the road.

Address Your Credit Score before You Start Home-Hunting

Your credit – including ensuring credit reports are correct, knowing your credit score, and acting to improve it – is among the most confusing topics related to personal finance. Yet it’s extremely important – particularly if you’re planning to buy a house, and especially if you’re a first-time buyer. Your credit score is one of the first things a lender will look at when you apply for a mortgage.

To cut through all that confusion, here are five tips you can act on right now to identify and address any problems with your credit:

  • Check your credit reports for free once a year through the three credit bureaus: Equifax, Experian, and TransUnion. Why all three? Because the information in each bureau’s report can differ. If one or all reports include mistakes, your credit score may be negatively affected, and you may need to address the errors before going house-shopping.
  • Be strategic with credit card use: the percentage of your credit limit that you use every month can affect your score. Make sure your balance doesn’t come too close to your limit.
  • The simplest and most important tip? Pay off your balance each month. To maintain a healthy score, pay it off before the due date. Anything after 30 days post due date can spell very bad news for your score.
  • Be consistent: good credit behavior over the long term will keep your score high.
  • Don’t take on more credit. If you apply for several different credit cards, you’re sending a message that you may have maxed out your other accounts.

Small Homes Are Trending with First-Time Buyers

According to the National Association of Home Builders (NAHB), first-time homes are coming in smaller packages.

The Association recently released the NAHB Home Builder Preferences Survey indicating that smaller homes are selling well, primarily to first-time buyers, such as the latest cohort – the millennials. The home builders interviewed for the report suggest that many people now prefer to purchase small. And U.S. Census Bureau figures support that position: the average home built in 2016 was 2,634 sq. ft., down from 2,689 sq. ft. in 2015.

Says Rose Quint, NAHB’s assistant vice president of survey research: “2016 marked the end of an era that began in 2009, when homes got bigger and bigger with more amenities. I expect the size of homes to continue to decline as demand increases from first-time buyers.” Smaller homes are finding favor with other groups as well. Retirees who enjoy traveling find that smaller, lock-and-leave residences fit their on-the-go lifestyles, and economic realities mean that they now have to think small.

While both the downsizing and millennial buyers are comfortable with less space (and the resulting savings on utility bills), they still expect the luxurious finishes and modern amenities available in larger homes. Millennials, because that’s what’s trendy now, and retirees, because they don’t want to feel they’re settling for less.

As a result, home décor magazines and TV network programs are touting the benefits of small homes and showcasing elegant space-saving solutions designed for those who want to scale down their homes without changing their lifestyles. Because they won’t.

Improvements That Increase Your Home’s Value

This year, if you’re looking to increase the value of your home but are unsure what home improvements to make, think curb appeal.

According to a recent report from Remodeling magazine, curb appeal projects, such as changes to windows, siding, and doors, lead to a higher return on investment (ROI) than interior improvements.

Over the past 30 years, Remodeling has compared the average cost of improvement projects with their value at resale, based on the experience of real estate professionals. The magazine’s 2017 Cost vs. Value Report supports the generally held opinion that today’s home buyers, while still enthusiastic about the bells and whistles, want to ensure their homes are structurally sound with all systems functioning efficiently.

Remodeling’s projects include a basement remodel, an entry door that was replaced with 20 gauge steel, and the addition of stone veneer. All of the 29 projects tracked returned on average 64.3 cents per dollar spent.

Among the trends, the higher return of curb appeal projects and projects that required the replacing of windows, doors, etc. Replacement projects generally scored higher than remodeling projects; the ROI of replacement was 74% and of remodels was 63.7%.

As in the previous year, adding loose fill insulation to the attic returned 107.7% and was the only project on the list whose value exceeded its cost. Steel door replacement and addition of stone veneer also paid off, at 90.7% and 89.4% respectively. Interestingly, these are among the cheapest projects, although their costs were up over the previous year.

Those who want to tackle an interior project might do well to consider a basement remodel, providing it’s done well; a high-end basement remodel was perceived as high value, returning 7.4% more than the same project last year, while a mid-range basement remodeling project only increased in value by 3.3% over the previous year.

Something to consider when you’re planning your next home improvement project.

Shopping for a Home This Spring? Get a Credit Checkup

Spring may bring thoughts of your dream home – and what better time for a home search than now?

By the time summer comes you could be happily ensconced in your new home. Think outdoor living and a relaxed intro to a new neighborhood.

But before the dream turns into a full-fledged home search, there are several things to consider. One of the most important is your credit score and what that score may mean as far as your mortgage options.

To advance to the search phase, you’ll need to know what your credit score looks like now and where it ultimately needs to be for you to be in a position to purchase a home. So now is an ideal time to contact your mortgage professional to review your credit.

Indeed, you can pull your own credit, but what you need is a way to interpret what’s on the report and how it will impact you throughout the lending process. Many things that you may see as minor on your report may actually make a significant difference in accessing the programs and interest rates you want.

For example, if you carry a lot of credit card debt or if one card has a higher balance than most lenders feel is appropriate, that’s a negative. But if your mortgage advisor draws this to your attention, you’ll have time to pay off or reduce your balance before you start to search.

And the sooner you start, the sooner you can be in your dream home.

Try ‘Home Refreshing’ Rather Than Spring Cleaning

Too many people don’t have the time or energy to do a full spring cleaning. Thankfully, a quick and simple home refresh will go a long way toward making your home look new without breaking the bank or your back.

In a Houzz article, Laura Gaskill outlines several easy ways to refresh your home for spring. For example, freshen up your entry simply by sweeping and mopping the front porch and adding a new welcome mat.

If you’re fortunate enough to have a back entrance or mudroom, it’s time to clear out all the remnants of winter. Consider adding extra storage with baskets, racks, or closet organizers to keep your newly tidied mudroom or entrance clutter free. And while you’re decluttering, why not tackle clutter catchalls like junk drawers and countertops? You’ll be able to find things again, and your space will feel brand new.

Can’t remember when you last cleaned your light fixtures? You’re not alone; most of us miss this step during regular dusting.

By wiping down neglected lamps and sconces (and those ever-so-dusty light bulbs), you’ll lose the grime that’s accumulated over many months (years?). Your living space will suddenly feel so much brighter and lighter you may decide to tackle your mirrors and inside windows next.

It needn’t cost the earth (or take forever) to change up your décor. New paint is great, but you can achieve a similar result with less work by applying one of today’s trendy large-scale adhesive murals to a blank wall. The result: an instant accent space that’s easy to switch up when it’s time for a change. And don’t forget greenery-add plants and flowers to your living space for that instant spring feeling.

As you can see, spring cleaning no longer has to be intimidating. With these simple tweaks, your home will feel like spring before you know it.

Should You Sell Your Home Yourself?

Despite the prevalence of online tools that can facilitate DIY sales, fewer Americans are choosing to go the route of “for sale by owner” when it comes to selling their homes. According to the National Association of Realtors (NAR), for-sale-by-owner sales represented only 8 percent of 5.25 million real estate transactions in 2015. Why? An economy in recovery, a challenging real estate market, and strict laws and regulations could all have Americans looking for security and peace of mind when it comes to selling their homes.

The for-sale-by-owner approach does have perks. Private sellers can set their own price. They deal with the buyer directly. At the end, they keep the proceeds instead of paying a commission to a Realtor. However, those very same perks have significant drawbacks.

Setting your own price means missing out on the expertise that a real estate agent has when it comes to pricing a home to sell and encouraging multiple bids. You don’t have the know-how that comes with dozens of successful sales. It’s easier for buyers (and their agents) to undercut private sellers, and it’s difficult for sellers to remain neutral about their own property.

Private sellers also miss out on the strategies and industry knowledge provided by an experienced agent. A real estate agent knows how to market a home properly, how to work with other agents, and how to fulfill the obligations and respect the laws of the real estate industry. It’s very easy for private sellers to misstep, costing themselves time and money.

As a seller, you want every advantage available. That means having an agent by your side.

How to Set the Stage for Home Buyers

In a hot market, selling your home may be easy. Selling it for top dollar takes a little more work. To achieve this, staging is the way to go. This is the process of beautifying your home to appeal to as many potential buyers as possible.

Many people can’t visualize the possibilities within a room, so staging helps the buyers as they view your home. The goal of staging is to transform your home into an environment so inviting that buyers can imagine themselves living in your space.

Creating this buyer-ready environment takes talent, and it can be a critical step for a fast sale.

What does a stager do?

A good stager improves the interior and sharpens curb appeal as well. Today, most buyers see pictures online before choosing which homes to tour. Staging ensures that yours is seen in the best possible light. It makes your listing stand out from the competition.

While some people actually replace all the furniture, smart staging may mean anything from stripping your home of personal photographs and knick-knacks to cleaning the rugs or polishing floors. You may need to deep-clean bathrooms or clear kitchen counters. The stager may suggest painting everything a warm and inviting – but always neutral – color.

How much does staging cost?

The cost of staging ranges from a few hundred to many thousands of dollars, depending on the reputation of the stager, the size of the property, and the quality and quantity of fixes required. The final results can be well worth the investment. If you live in a neighborhood where several homes are listed, staging may mean a quicker sale at a better price.

Can I stage my home myself?

Of course, you can try to stage your home yourself, but it’s hard to be objective about your own things. A fresh pair of eyes can make all the difference – which translates into dollars.

Should You Consider Investing in Real Estate?

Real estate is becoming an investment of choice, and many investors are either abandoning the more traditional vehicles such as stocks and bonds or using real estate to diversify their portfolios.

A recent RISMedia article pointed to a survey recently undertaken by Better Homes and Gardens Real Estate, which found that “(n)early all (96%) of U.S. investors surveyed who have invested in real estate believe their decision has helped them achieve some form of financial success.”

The interest in investing in real estate may be driven by our largest demographic-the millennials, who, according to the survey, show a greater interest in making a real estate investment than do boomers. Millennials in particular are more interested in personal real estate purchases (homes) than in buying commercial properties; the survey noted that “79% of investor respondents feel it is important to invest in a property that they could use for themselves or a family member at some point.”

There are various ways even a small investor can participate in real estate investments, such as a self-directed or real estate IRA. However, many fear they aren’t sufficiently knowledgeable about real estate investing. As the RISMedia article points out: “Unlike many other investments that can be made with the click of a button, real estate investments are often complex and require careful consideration.”

To ensure that your investment will be a good one, it’s important to consult with a financial professional who is familiar with real estate investing, as well as an investment-savvy real estate agent.

Location, Location … the Good, Bad and Ugly

We all know that living near a good school increases the value of your home. But who knew a neighboring cemetery can adversely affect your property value? Or that proximity to a hospital isn’t a good thing?

In fact, we now know – or should know – that nothing is more important when selling your home than your neighborhood. So if you’re buying, think ahead; purchase your dream home in the wrong location and you may be buying into a nightmare. Here are some location no-nos:

  • Realtor.com research has found that living near a cemetery will lower your property value by 12.3% and having a hospital nearby means when you sell you can expect an impact on your sale price of 3.2%. Also note: make sure you move near a “good” school; a “bad” school will reduce your home’s value by 22.2%.
  • An article in the Journal of Transport Economics and Policy indicates that having an airport nearby can discount the value of your home. The greater the noise level, the greater the negative impact.

Among the amenities to look for in your neighborhood-to-be:

  • Proximity to transit. According to a Transit-Oriented Development in America survey, 55% of Americans would pay more to live near good transit options. The study, conducted by consultant HNTB Corporation, found that 57% of respondents liked not having to depend on cars to “work, live, and play.”
  • A neighborhood on its way up-not down. In transitional neighborhoods, you get a lot of value for your home-buying buck. Your real estate agent is the best source of information and will also know if there are any planned roads or developments that may impact the neighborhood-positively or negatively.
  • Water, parks, and green spaces. A nearby waterfront can add up to 25% to the value of your home. A fabulous view is also a moneymaker when it comes time to sell.