New Home Source Blog

Condos, Townhomes, or Houses: Which is Right for You?

Good question. When you're looking to buy a new home, one of the very first and most important decisions you have to make is whether to buy a condo, townhome, or single-family home. This decision will usually depend on both your budget and your lifestyle.

Single-family homes are considered a better investment, as home values are usually higher than those of condos or townhomes and because they tend to be easier to sell. Since you own the land and the structure, however, you're responsible for the upkeep and maintenance of every part of your new house. Consider whether you have the time, money, and desire to deal with the responsibilities this type of home requires.

With a new condo, you typically get more house for the money, but you only own the interior of your unit. You also share walls with your neighbors, perhaps on all sides (including above and below). On the other hand, because of the monthly association fees that are required with a condo, you don't have to worry about the exterior.

Townhomes are the middle-ground of homes and condos. While you might share walls with your neighbor, your own entrance from the street and usually a small area of yard give you the feeling of having a house. The required monthly association fees will cover some of the maintenance costs, but you're limited in what you may change on the exterior. A townhome is an excellent choice if you want to have the feeling of owning a home, but with a lower purchase price and less maintenance responsibility.

What Is in Your Mortgage Payment?

As you're searching for your ideal new home, it's important to understand a little more about how you'll finance your dream home. One area of confusion for many is the monthly mortgage payment.

Your monthly mortgage payment consists of more than just the loan amount plus interest. Taxes and insurance are other expenses that may be factored into the payment.

Most lenders require you to pay a calculated amount each month into an escrow account, out of which the lender will pay the property taxes and various insurance premiums, such as homeowner’s, flood, and windstorm, when due. This is helpful in terms of budgeting for these items because your lender is saving this money for your benefit and will pay those bills.

Another amount that may be added to your mortgage payment each month is private mortgage insurance (PMI). If you put down less than 20% of the purchase price of the home when it's purchased, the lender may require this insurance, which will cover the lender in the event of foreclosure. PMI is typically 1% of the loan amount and can usually be canceled and removed from the loan once your home value increases and you have at least 20% equity.

It's very important to consider these additional expenses when deciding how much to spend on your new home. Depending on where your new home is located, these additional amounts can represent a significant portion of your entire mortgage payment.

Be Aware of the Hazards of Buying a Used Home

Older homes possess a certain charm, but what's less charming are the various safety hazards that may be present, depending on when the home was built.

• Lead-based paint was commonly used prior to 1978 and isn’t a problem if left undisturbed; however, when the paint chips, peels, or is scraped off, particles might be released and subsequently ingested by children or pets, posing a significant health risk.
• Another common component of older building materials is asbestos, which can be present in insulation, vinyl floor coverings, siding, and some roofing materials. Insulation poses the biggest health threat, as the asbestos can become airborne when the insulation is touched. It should only be removed by a licensed professional. Unless damaged, it's best to leave asbestos siding alone.
• Radon, a naturally occurring gas, can enter older homes through foundation cracks or unsealed or improperly vented basement flooring. Foundations in older homes were typically not sealed, and this may lead to cracking and water seepage, leaving the home vulnerable to problems such as rot, mold, and termites.
• Prior to 1940, lead pipes were used for plumbing, and even the steel pipes and soldering on copper pipes used in later years sometimes contained lead. Whole house-water filtration systems can minimize the problem, as can replacement of the pipes, but these measures are costly.
• Outdated wiring can lead to safety concerns, as older construction may not have grounded outlets or the newer ground-fault interrupter outlets in areas where water is present, like kitchens and bathrooms.

The problems inherent in buying an older home are not insurmountable, but may involve significant time and expense. Any purchase of an older home must start with a thorough home inspection to determine if these hazards exist and an assessment of the cost of abating these hazards or upgrading to safer systems.

Why not avoid these problems altogether by buying a new home?

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Source:
http://www.mortgage-investments.com/Investors_in_Real_Estate/problems_with_older_homes.htm

Capitol Hill Offers One More Reason to Buy New

Economic woes aside, you have to admit that now is the best time in modern history to buy a new home. When homebuilders are desperate to offload inventory or start new building projects, you're not only guaranteed to get an incredible deal, but you'll also be working with builders who use the most advanced construction techniques and the greenest materials to build the most resource- and energy-efficient homes in history.

Adding to the already prime buyer's market, the federal government announced a First Time Home Buyer Tax Credit of up to $8,000. And, unlike prior tax credit programs by the US Government, this credit does not have to be repaid. Here are the general guidelines for qualifying:

• Your home must be purchased between January 1, 2009 and December 31, 2009.
• The home must be your primary residence.
• You’re a single taxpayer with an income of $75,000 or less, or ...
• You’re a married taxpayer with a combined income of $150,000 or less.

The tax credit is for 10% of your home's purchase price, but it can only be a maximum of $8,000. Other aspects of the stimulus package promise to help unfreeze the credit markets, making it even easier to buy a new home. So what are you waiting for?

To find your dream home, check out the more than 8,000 communities on NewHomeSource.com.

You can find special offers by clicking on the Special Offers tab on the market and community results pages.

 

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Keith Goode is the Search Engine Marketing Manager for Builder Homesite Inc. and can be reached at kgoode@builderhomesite.com

What we really want in a home

Today’s buyers want more features in their homes and, given our 24/7 lifestyles, they mostly involve relaxation.

According to the National Association of Home Builders' annual consumer preferences survey, “must-have” features include decks, patios and homesites with trees. Walk-in pantries, islands/work space, solid surfaces, built-in microwaves, and designated storage areas were tops in the kitchen, while linen closets, separate showers and whirlpool tubs were important in bathrooms. Overall, buyers also want more storage in a new home – and lots of it – in every room of the house, including the garage.

Homebuying Habits

Having trouble making that all-important home purchase decision? You’re not alone.

According to a National Association of Realtors survey, a typical homebuyer walks through 9 properties, searches 8 weeks to buy a home and moves 12 miles from their previous residence into the new home.

On the selling side, the typical seller’s home was on the market for 4 weeks, they lived in it for about six years, typically moved just 15 miles to their new home, and had previously owned three other homes, including the one just sold. 

Ways to Save Money at Home

More consumers are tightening their collective belts in response to slow economic times, trying to save money where they can – whether it’s forgoing that morning latte or renting movies for free from the library.

Consumer-Action.org offers “66 Ways to Save Money” in all areas, including airline fares, car rental, new and used cars, utilities, housing and more. Here are a few good home tips you can use today:

-         Get a home energy audit, which can identify ways to save hundreds of dollars each year on home heating and air conditioning costs.

-         Review your phone bills for the previous three months to see what local, local toll, long distance, and international calls you normally make, and then call several phone companies to find the cheapest calling plan.

-         If you’re planning to buy a major appliance this year, consult Consumer Reports first. Once you’ve decided on a brand and model, call at least four stores to compare pricing. You could save as much as $100.

-         Remodeling this year? Get at least three bids from licensed, well-established contractors, preferably recommended by friends or colleagues.

Click here to discover more tips to save money at home on the Consumer Action website.

Why Are New Homes Better?

Buying a new home had many advatages over a "used" home. Did you know that a new home can actually save you money on energy bills?

1. Better Value Appreciation Research shows that often new homes appreciate more, as a percentage of original cost, than older homes.

2. Save Money on Energy Bills New homes are constructed with the latest energy-saving technologies. New insulation, windows, heating and air conditioning can save you real money on your monthly energy bills.

3. Floorplans That Match Your Lifestyle New homes are designed with the modern family in mind. Huge kitchens, walk in closets, and open floorplans just can't be found in older homes.

Go to NewHomeSource.com to read more on why new is better!