Recovery in the housing industry still seems far-fetched at this time. Prices are expected to drop further and foreclosures are not yet about to go away. Employment rate will remain a major deterrent to the industry’s complete rehabilitation as it remains sluggish and largely uneventful.
Because of these realities faced by homeowners, both existing and prospective, many have chosen to downsize either their physical homes or their expectations for a desired home. A lot of people have come to the realization that they are better off with more compact-sized homes for better manageability prospects in maintaining them and paying for them. Owners of larger and older homes are encountering difficulty in disposing their properties even if they desire to because of the wide range of choices now available to home buyers which includes new houses and foreclosed houses. More seriously hit are houses with condition and location issues. This is an especially advantageous time for cash investors as houses are being offered at rock-bottom prices.
Renting has experienced a resurgence in the past few years because of its viability as an option for those who wish to downsize but are are not able to sell their houses at once. The record-high household debt of many has forced previously uncommon living practices such as moving in with family a common recourse. It is not quite clear yet how affected homeowners are expected to effectively address the problem although the need to trade-down a large home to a smaller one is crystal-clear.
Since manageability of everyday living is now a concern of most people, it has to be understood that it is not only the size of the home that matters. Lifestyle and long-term plans will also come into play. While home designers look into sustainability for a home’s long-term use, homeowners should be looking into simplicity which would involve tapering off a large percentage of “wants”.
If you have recently been laboring over your decision whether to rent or own a house, why not take a breather and consider the rent-to-own option. Shelling out money month after month for rental or entering the commitment of buying a house may be too extreme for some. In the rent-to-own option, tenant-buyers have the chance of building up equity to eventually buy the house within the agreed period.
The arrangement is considered ideal for both the tenant and the owner-seller since the former is given the prerogative to change minds and totaly abandon the option to buy. The owner then gets to keep all money paid for rent while regaining the right to offer the property to other interested tenant-buyers, without further obligation to the previous tenant-buyer. Contracts of this nature will always consist of three parts – the rental agreement, an optional property management agreement, and a third agreement which provides for the property purchase at a set price and date as mutually agreed upon.
Expectations for property damage are lower in the rent-to-own option since the tenants are the possible future owners. It is logical that tenant-buyers will find it in their best interest to ensure the optimal condition of the property. Property owners have found a way to move their property under the prevailing difficult econmic conditions.
Tenants for their part are given a longer time within which to determine the suitability of purchasing a particular property. Of course, buyers must have long-term plans in place which is not possible without any long term job prospects or reasons to stay in a particular place . A rent-to-own contract usually expires between 2-5 years.
You don’t want an RV. You are not a “water person.” So do you still have cheap alternatives for a home? Of course! Have you ever heard of manufactured homes? Those edifices that are factory built and roll of the production lines?
You may be grimacing as you read that previous paragraph but hey, there is more to manufactured homes that meets the eye. Seriously, manufactured homes may not end up as treasured buildings like the colonials of the old but they can do the job during these hard pressed times.
First of all, manufactured homes are really structurally sound. Experts say that these houses can withstand most anything, except maybe the strongest of hurricanes, which even the traditional houses cannot withstand. Second, manufactured homes are quite affordable. This is because of the fact that the companies who build these homes save a lot due to the scale of production. They purchase all the components and appliances on a large scale, giving them considerable savings. This, in turn, translates to savings on the home purchaser’s part! In short, it does not mean that, since you are paying much less for manufactured homes, you are paying for poor quality. It just means that you are taking advantage of mass production – an economic practice, is all.
I suppose the biggest hurdle when it comes to manufactured homes is the image. Not too many people look kindly on manufactured homes. Then again, are you more concerned about what other people think that what you can afford?
If you want to read more on manufactured homes, visit Bankrate’s section on this topic.
I suppose that for many people, living on a boat will not be the first alternative form of housing that would come to mind. After all, we know quite well that boats could be very expensive. In fact, only those who are quite well off can afford a boat these days. So why are we suggesting boats as a form of alternative housing?
Have you ever heard of house boats? These are flat bottomed boats which are designed to hold cottage-like structures. If you like the water and you want to save on real-estate costs, then you might want to consider purchasing a house boat and calling one your home. What do you need to know about boat houses? MSN provides more information:
A 30-year-old, 40-foot houseboat may sell for as little as $8,000 to $10,000, but the maintenance to make or keep the vessel seaworthy can be daunting and costly. In any case, Morton suggests avoiding boats that are more than 25 years old because they are hard to finance and insure.
Boat loans are similar to RV loans — at least a point higher than mortgage loans for homes, nearly always requiring 20% down and limited to terms of 10 or 15 years. If you buy a $50,000 houseboat and finance $40,000 of the price over 15 years, expect to pay about $370 per month, assuming a 7.5% interest rate. As long as the boat has a galley and a head, the interest is tax-deductible, just as with a mortgage.
While there are certainly plenty of houseboats in inlets and bays near the ocean, inland lakes are prime houseboat territory. Renting a slip in an agreeable area that permits people to live aboard year-round costs anywhere from $300 a month for a no-frills slip on a lake to as much as $1,500 a month in a marina with ocean access. Unmetered electricity, including an air-conditioner, can run as much as $50 per month. And if more than two people live aboard, generally there will be a $25 or $30 charge for each.
Water is usually included, but sewage pump-out will be extra. The Environmental Protection Agency estimates the annual cost of weekly pump-outs for a boat on which people live aboard to be $550.
Other costs include insurance and, if the boat is older than 10 years, an initial survey of its condition. Prices for the survey and the insurance are based on the value and size of the boat, but a ballpark estimate of insurance on a 30-year-old houseboat worth $50,000, docked on an inland lake is $600 to $800 per year, plus about $750 for the survey.
What do you think? Cheaper than maintaining a conventional house and lot?
Is there such a thing as a cheap house? Perhaps in relative terms, yes. The chances are you would still have to pay a LOT to buy your own house – these things do not come cheap, really. However, there are some ways by which you can find houses at much lower prices than normal. How?
You can buy from the bank. We all know how the real estate market has suffered a great deal in the past several years. In fact, figures show that the national home median price has dropped to about 26% since the early part of 1996. This spells good news to those who can afford to buy houses. Even better, banks have foreclosed a lot of properties. Technically, the banks own these properties but they cannot really hold on to them. They would rather sell them off and turn the properties into cash – and they do so, at much lower prices.
What you have to do then, is to do research on REOs, or real estate owned properties. The advantages of buying REOs are plenty. Aside from getting a very very huge discount, you do not have to deal with another homeowner. You know how, when we want to sell something off, we tend to try and get as much as we can. When you buy REOs, you do not have to deal with the homeowner and instead go directly to the bank. More so, you get a clean title at the outset!
So why not try and take a look at this option?
This may not be the best of times to apply for a mortgage. Then again, many Americans are feeling a renewed sense of hope after the results of the elections came in. If you are looking for a mortgage right now, I encourage you to do so carefully and avoid these mistakes.
Leaving your credit as is
Believe it or not, a lot of people actually just hope and pray that their credit will be good enough to get them a good mortgage. The truth is that you need a more than decent FICO score to get a decent deal on mortgage. Please do not leave your mortgage dealings to chance. Pay close attention to your credit and try to rectify errors in it before you apply for a mortgage. You will certainly appreciate the difference it will make.
Not looking into various deals for first-time home buyers
If you do not know it yet, the government has various programs for first-time home buyers. These programs are run in different levels – state or city, even county. If you are buying a house for the first time, I suggest strongly that you look for these deals. It won’t require much effort but the rewards are tenfold.
Thinking that pre-approved loans are not necessary
Ok, maybe they are not necessary but having a pre-approved loan will make you a priority in the eyes of real estate agents. Do not make the mistake of thinking that pre-qualified and pre-approval mean the same thing. The former is an unwritten thing – no guarantees – while the latter means that you really do have a loan ready for the purchase.
(to be continued)
I love bathtubs. I could end my post there. I really love them. If I had the money, I’d have several huge bathrooms in my house and put all sorts of bathtubs in them. And I am sure that there are many of you out there who are into bathtubs as well. Just some information for those who are in the market for some tubs – what are the different kinds of bathtubs?
Soaking bathtubs
Aren’t all bathtubs for soaking? Apparently, there are tubs which are meant for, well, you got it, soaking. They are deeper than the standard tubs, with water going as high as one’s chin while lying down. More so, these tubs do not come with any other attachments such as showers and jets.
Built in bathtubs
These tubs are what we normally have at home. They are not separate attachments which you can move around the bathroom, but are instead “built into” the room, as the name suggests.
Freestanding bathtubs
These are those beautiful tubs that you see with big claws as feet. As opposed to the built in bathtubs, they can be moved around and be relocated wherever you want them. Those big pedestal or clawfoot bathtubs fall under this category.
Special tubs
I suppose all the other kinds of tubs that do not fall under the conventional types above will fall under this category. From high tech tubs with jets and whirlpools to walk in bathtubs – you can find the tub to suit your special needs.
In the previous post, we looked at how bank web sites and government agency web sites can be your main sources of information on foreclosed homes that are for sale. Are there any other options open to you if you are in the market for a new home? The answer is a resounding YES. Aside from these web sites, you can also do the following.
Real estate signs
This option requires more physical activity on your part. As opposed to the options presented in the previous post (where you just have to turn your PC on and browse), you have to drive around the neighborhood wherein you want to buy your home. When you drive around, look for FOR SALE signs and pay particular attention to the information on them. Look for signs that say FORECLOSURE and then contact the real estate agent on the sign.
Real estate agents
If you do not have time to go running around neighborhoods, then you might as well get in touch with a real estate agent. After all, this is their business and they will have top information on property for sale. You just have to indicate that what you are looking for are foreclosed homes which present a good deal.
Asset management companies
You can also contact asset management companies in your area to inquire about foreclosed homes. Oftentimes, banks or lenders hire these companies to handle foreclosures. As such, they will have information of foreclosed homes that you can buy. You can do this by looking at their web sites or even calling them on the phone.
Photo courtesy of sfadden
I am a firm believer in respecting others and not benefiting at the expense of others. Yet as in many things, this could be quite relative. As sad as the situation may be with many homes being foreclosed, those who are in the market for a house today could actually benefit from the situation.
What happens when a house in foreclosed? They are normally put in the market for very low prices. This is where you can benefit. However, you also have to remember that not all foreclosed houses are good deals. Some of them may come dirt cheap but they may have attachments such as liens or mortgages.
The best thing to do would be to look around and find a good bargain. How do you go about that? Here are some ways by which you can hunt for a foreclosed home to buy.
Bank web sites
Banks lend money to homeowners so that they could purchase or build their houses. They also lend money using the property as collateral. When the borrower fails to pay back their loan, the property is reclaimed by the bank. It is then left to the bank to liquidate the property that they have repossessed. You can usually see these properties listed on the bank’s web site.
Government-owned listings
Banks are not the only institutions that lend money using homes and properties as collateral. There are government agencies which function much in the same way. They also foreclose properties and then put these properties up for sale. You can visit the web site of the Department of Housing and Ubran Development for more information.
Photo courtesy of nep
It’s on again. That darn infomercial. It keeps calling me telling me how I can make all that money. Money investing in real estate. Seems like we are in a great time to become a real estate leader just because the mortgage market is tanking, and there should be a great number of homes that will come available at below market rates just so the bank can make back some of the money on their investments.
One thing I’ve found is a great place to buy cheap automobiles is Credit Unions. A credit union is a cooperative which operates similarly to a bank, but is owned and controlled by people who use its services.
If you aren’t already a member of your local credit union you should be. Head on over to a credit union, develop a good working relationship with your local loan rep, and have him keep foreclosed property in a certain range in mind for you. It’s a great way to find cheap, undervalued homes that they are looking to sell quickly in order to keep the Credit Union profitable. Unlike a bank it’s about keeping the shareholders happy and keeping the nonprofit open. You can also use this to find other investment deals like automobiles that have been repossessed.
Here’s a great site you can use to find credit unions .
