Archive for the ‘Real Estate’ Category

Affordable Home Ownership: Keep It Affordable

August 18, 2014

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DURING A PRESENTATION WE WERE MAKING ON AFFORDABLE HOUSING (also known as worker class housing) attendee questions caused the discussion to drift into the realm of government involvement with housing programs. Since we see affordable housing, particularly affordable home ownership, as a key ingredient for stabilizing communities, limited government participation (such as tax credits) that jump-starts such activity can be helpful.

Moreover, in conjunction with federal/ state funds, some municipalities may, among other things, occasionally establish affordable home programs whereby contractors compete in a bidding procedure to construct a number of homes. When built, those homes will become available to an equal number of pre-qualified first-time buyers who are usually selected through a lottery-style process and generally have incomes that do not exceed eighty percent (80%) of the median household income for the municipality’s respective jurisdiction. Then the municipality ensures the new home prices are brought down to the affordable price range by utilizing public funds to reduce the cost of each said home.

In return for the reduced home price, each buyer commits to keeping his/ her home in the affordable home program for a required period of years during which he/ she lives in the house or, if it is resold, agrees the sale’s price to the next purchaser will be in the affordable range. At the end of the commitment period the home frequently is able to be sold at market value.

While other formats may exist, this is the type of affordable homeownership program we’ve seen implemented at the local level. No doubt well-intentioned, a home ownership program fashioned in this way tends to inadvertently create certain not-so-attractive by-products. First, it sets up a situation for the first buyer, who purchased at an affordable price, but may, after the commitment period ends, sell at market value, thereby pocketing the difference. Second, those houses only remain affordable for the length of the commitment period, meaning the municipality’s affordable housing stock could be back to where it was before that housing was built. Third, only the selected few are served; those not selected do without. Forth, this type of affordable home ownership program becomes a temporary fix to a growing problem.

This is not intended to find fault with any municipality because affordable home funding typically comes with many strings attached. Still, and for the reasons stated, we believe these homes, once built, should perpetually stay affordable and should be taxed accordingly. The ability to do so should not be very complicated and should not require scraping existing programs — proper redesign and modification should be sufficient. Over time this arrangement should consistently increase affordable home ownership opportunities. Isn’t this the way it should work?

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

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Real Estate: When Price Fails, Negotiate

August 8, 2014

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WHILE WAITING IN LINE AT THE POST OFFICE A CONVERSATION WAS OVERHEARD between two men who evidently knew each other. The younger man (who we’ll designate as “Young”) said he and his wife were looking to buy a home since the current market appeared to present an optimal time for the lowest home prices. He said they located a great home in a terrific neighborhood with a nearby playground for the kids but lamented the price was still too high for their income.

The older fellow asked if Young made an offer at a price he and his wife could afford, to which Young said “No,” explaining the real estate agent told them the homeowner might entertain an offer but Young declined to do so because any offer he made would have been significantly below the asking price and rejected. Really? How would Young know his offer would be rejected in the absence of submitting it?  Couldn’t there have been a chance the offer would be accepted … or that a tolerable counter offer may be presented? Of course!

Yet, walking away without making an offer guaranteed Young would have no chance to purchase that home. Would it not have been better to consult with his attorney and accountant to fashion then submit an offer? We think so. After all, the worst that could have happened was a rejection.

Recently we’ve heard real estate salespeople mention the reluctance of potential buyers to make an offer on a property that appeals to them, preferring instead to walk away. But why?  Maybe there are theories about buyer resistance to make an offer or negotiate a price, though based on what we’ve seen and heard such reluctance seems to stem from the evaporating art of disciplined and cool-headed negotiation.

Perhaps parties to potential transactions should be reminded rejection of an offer should not be emotionally digested. A better reaction would be examining reasons for the rejection and seeing if another offer is possible as an evolving opportunity that is part of the back- and- forth process from which a seller wants as much money for his/ her property as possible, while a buyer wants the best possible bargain. Both positions are valid and its constructive old-fashioned negotiation that builds a bridge between them.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

Inhouse Corporation: Our 25th Year

July 28, 2014

Celebrating  25 Years of Service

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AS WE ENTER OUR TWENTY-FIFTH YEAR OF SERVICE we are proud to look back at our accomplishments. Its a track record that includes non-subsidized affordable homeownership, manufactured/ modular homes, real estate broker services, multi-family/ commercial property management as well as the creation and operation of residential cooperatives for modest income households.

Among the entities we’ve assisted are municipalities, government agencies, investors, landlords and residents/ tenants with administrative services, management, consulting, research, training and mentoring for all sorts of issues, problems, questions and day-to-day routines as they relate to housing and income properties.

Although New York is our home state, as internet technology has grown over the years so too has our ability to render many of our services online to virtually all corners of the state. And we’ve even taken assignments in other areas on a case-by-case basis. Yet our philosophy remains the same — we don’t try gaining business by cutting friendly personal attention, reducing value or sacrificing quality to our existing clients. We build our firm one client at a time. Its probably one reason many remain clients for years.

Many thanks to all our friends, clients and business associates who helped us to reach this point.

We look forward to working with you and making new friends and clients during the next twenty-five years.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

Real Estate: Have A Crystal Ball

July 18, 2014

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WHEN SUBMITTING A MUNICIPAL REAL ESTATE APPLICATION, take nothing for granted.

Case in point: Do you know many municipalities can access a procedure that legally lets them create one large land parcel from two or more abutting lots that are owned under the same name? Folks often are surprised to learn this, but taken aback to learn the procedure usually can be completed  without notice to the owner and without the owner’s consent.

A corporation that would later become our client discovered this the hard way. It had an interest in purchasing one of three separate contiguous parcels. Each of them had been developed years earlier and each had a different use: Multi-family; retail; and single family. Although all three were under the control of a company that actually owned the properties and was selling them, they stayed as separate lots under a form of the technique known as “checker boarding.”

Though our eventual client was only interested in purchasing the multi-family parcel, the seller insisted all three had to be bought together as a package ― it was all or nothing. Ultimately the three lot package was bought through a strategy to resell the retail and single-family parcels promptly after the closing. Unknown to the client at the time, once the three parcels were purchased in our client’s name they were soon merged into one, which fact became abundantly clear when arrangements were made to market the two lots.

At this stage we were retained as management consultants and from that station learned our client hired an expert attorney to petition for the restoration (unmerging) of parcel lot lines to premerger positions. The client was optimistic due to the favorable specifics involved: No two parcels had the same use; and each had been fully and independently developed long ago with its own infrastructure, utilities and buildings. As the client deemed the matter an unwelcome expense and inconvenience rather than a potential obstacle, it commenced preliminary plans to market the retail and single-family parcels.

However, that inconvenience unsuccessfully dragged on for about three years. The municipality requested documents, information and introduced requirements that had no reasonable relationship to the lot-line restoration request, including such things as mortgage documents, names of tenants and property tax data. New requirements seemed to arise at each hearing. At one juncture the municipality alleged a lot-line restoration would increase town density despite the fact that the parcels could not be further developed.

In the end the merger stayed intact. The client released its attorney and halted its lot line restoration efforts believing the municipality simply didn’t want a multi-family facility to remain in the area of the client’s property even though zoning did not forbid it. Given the time elapsed and money spent, the client’s resolve and resources apparently were too drained to move to the next step, a lawsuit.

The bottom line: Either take nothing for granted with a municipal application  … or have a reliable crystal ball as a guide.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

 

 

Real Estate: Communicating The View

June 22, 2014

 14Jun28 New Pix

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USING QUALIFIED PROFESSIONALS WITH LAND MATTERS is almost a mantra, and most folks do. But for those experts to be effective they need to know the factors driving a transaction.

Take the case of a municipal planning board meeting we witnessed. A small group accompanied an evidently agitated though elegantly dressed lady as they entered the room en masse. The woman asked to be allowed to present her concern to the board and despite not being on the evening’s agenda the chairman permitted her to proceed. The lady articulated her experience in recently having spent a considerable sum to purchase a specific lot in a subdivision and to construct a house on it — all for the purpose of enjoying the panoramic view her acquired property offered.

However, she learned from the folks who came to the meeting with her that someone could buy the parcel resting between her plot and the view she cherished then erect a house that could be two stories high, thereby obstructing the vista. The woman informed the board she would not have purchased the property had she known her view could be blocked. Why wasn’t the vista protected, she inquired.

Board members listened attentively. The chairman finally asked what she was requesting his board to do. In so many words she responded that all development rights should be removed from the neighboring parcel, which response evidently triggered board member questions. Was her purchase conducted under the guidance of an attorney? Did she make the permanency of the view a condition of her purchase? Did her paperwork state the view would be permanent?

Yes, she had retained an attorney for the purchase but didn’t fuss about the view. She admitted the paperwork said nothing about it because she just assumed her view would always be available … after all, she reasoned, who would want to destroy such a scene?

Several board members spoke among themselves, the gist of which seemingly was their board could neither intercede in the matter nor consider removal of the parcel’s development rights. A couple of members opined their board could do nothing even if the view had been contractually preserved since it was a private matter. One member claimed to be familiar with the area and said the home the woman erected actually blocked the view of the home behind hers.

The chairman said he understood her concern, described the reasons his board could not get involved then explained the panorama she liked was not designated as a protected vista. He asked why she didn’t buy the neighboring parcel to ensure nothing would be built on it.

This was not the board reaction she wanted. Obviously disheartened, the woman and her entourage departed the meeting.

The bottom line: Tell the professionals what is expected from the transaction. After all, it’s a matter of communication.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

When Idle Rumor Isn’t

June 1, 2014

 DSCN0428

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YOU’VE HEARD THEM, AS WE HAVE. They’re rumors that take flight like dandelion seeds seeking a fertile place to take root then grow and regenerate ― rumors that may but frequently do not have any relationship to truth.

In the property management arena an onsite manager usually isn’t privy to rumor involving him/ her, the management firm or the property being managed. Even when aware, most rumors typically seem trivial, nonsensical, inconsequential or ridiculous to the degree of blatant improbability. So why bother with them? Aren’t there far more important things needing attention?

Actually, such reactions can be shortsighted. Whether factual or not, we’ve found a persistent rumor is similar to a persistent trickle of water against a building foundation … it has power to undermine. And while residents are apt to lack fondness for paying rent, they should recognize the management team as being competent, professional and ethical. Yet, an unchecked rumor circulating among residents that negatively affects property management may seriously damage that recognition even when the rumor is totally unfounded.

Case in point: A troubled residential cooperative we knew did not have a professional management firm to handle day-to-day matters. Instead the co-op board of directors seemed to inappropriately tolerate its president making unauthorized, unilateral, often inconsistent or confusing, operational decisions evidently based on little understanding of property management. Compounding that situation were infrequent, irregular and poorly advertised board meetings.  It was a setting ripe for rumors … and fly they did. But the two most prevalent ones pointed to the board as either secretly planning to sell the co-op’s real property to a third-party, or allowing the president and/or one or more board members to secretly arrange their purchase of the property.

How those two rumors started is anyone’s guess. Each was outrageously false because the co-op bylaws required all co-op shareholders to vote on a sale of co-op property in an open shareholder meeting. Inasmuch as a quick read of the relevant bylaws section would easily debunk both rumors the board simply laughed them off in the belief the absolute lack of truth would cause the rumors to die.

But they did not die. They persisted. They caused private worries of shareholders to evolve into shared concerns between neighbors then to morph into grumblings too loud for the board to ignore. By the time the board decided to react it was too late. Even the bylaws could not seem to dispel the entrenched misunderstanding, eventually leading to shareholders forcing a meeting with the consequence of the president being removed and several board members being replaced. Unfortunately the unrest ensnared two of the hardest working board members who probably should have been retained. Worse, the new board seemed unable to rectify the tailspin the rumors caused, which, among other things, eventually collapsed the cooperative.

What should have been done? In a nutshell: Competent professional management should have been retained; co-op business and decisions should have been conducted and made in as transparent a manner as possible, with the board conducting regular meetings under proper advance notice that provided time for shareholders to express their concerns; regular accurate communication should have been distributed to shareholders (for example, a newsletter); and rumors should have been promptly, straightforwardly and respectfully addressed.

Bottom line: Establish procedures to help prevent destructive rumors and don’t ignore them if they arise nonetheless.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

Qualities of a Property Management Firm

May 25, 2014

Prop Mgt Questions

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DISTURBING HEADLINES APPEAR ALL TOO FREQUENTLY: Property manager guilty of rent theft; property manager pockets security deposits; property manager ignores city water bills. And we cringe reading them because good managers do exist. Finding good managers is the problem, especially since no particular search method is failure proof.

To the rescue―or so it would seem―come the various articles that list the tips that will aid a property owner in selecting a good manager for his/her property. Good skills with people, attention to detail and a willingness to work weekends are commonly mentioned attributes. Are such tips helpful? Well, let’s put it this way, it would be difficult to argue that such qualities do not matter because they do. So if you’re a property owner and only need someone to relay resident complaints, call the plumber and collect rent, then employing someone of pleasant character and reasonable responsibility may suffice. However, such an employee may have minimal, if any, appropriate training in, working knowledge of or meaningful experience with the requirements, obligations and laws that apply to rental property operations. In which case inadvertent violations are more prone to occur.

Interestingly, we find too few articles focus on contract property management firms, and even fewer seem to mention management firms that are professionally licensed and insured even though some jurisdictions require a license and insurance to perform management services. Of course, holding a license doesn’t guaranty competence though the license should be a more reliable indicator of the firm’s expertise, which is one reason we recommend seeking a professional firm that is licensed and insured whenever we’re retained to assist with property management firm selection

When we make this recommendation someone usually says it is a self-serving requirement since we are a licensed and insured firm that performs property management services. Quite honestly we understand such a recommendation may be viewed that way, but experience shows a licensed firm displays a professional commitment to better service through training, experience and competence. Moreover, such a firm is likely to bring other notable staff qualities to the table.

Foremost among these is familiarity with other similar projects, which is another frequently and correctly mentioned tip in the said articles. Yet nearly as important though seldom referenced is the property management firm’s ability to effectively communicate with resident tenants. This goes beyond sending flyers about a residents’ bake sale or writing violation letters. It is the regular proactive effort to keep residents informed about their building or community, fully answering questions, assisting with resident problems when appropriate and being receptive to residents suggestions for improvement.

If a property owner finds a competent licensed and insured management firm having experience with similar properties, people skills, attention to detail and effective communication, in our opinion that property owner may have hit a grand slam home run.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

Looking At The Real Estate Appraisal

April 27, 2014

  Appraiser 0058

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AN APPRAISAL OF SPECIFIC REAL ESTATE USUALLY is more dependable than a property tax assessment or a real estate agent’s opinion of value. And it is useful when establishing an asking price. However, being more dependable does not necessarily mean it is infallible. After all, an appraisal is a value estimate calculated through a generally accepted procedural methodology that in practice is partly systemic and partly reflects the skill of the particular appraiser.

Viewed in this way an appraisal report should be read thoroughly. Unfortunately, too many just look at the final value then become glassy-eyed when attempting to read the rest, either skimming over or ignoring the balance of the report which often can be a mistake.

This was clearly illustrated when the seller of a unique parcel of commercial real estate was very displeased and uncomfortable with its appraised value. Since the real estate tax bill indicated a value of $750,000 the seller felt confident the appraisal would be somewhat near that amount. But when the appraiser estimated the value as $575,000 we were contacted to review the situation as well as the appraisal report.

To be placed on the market was a one acre parcel encompassing a large old concrete structure which was rented by an entity not concerned with appearances or foot traffic. Although situated along a busy highway in a retail zone, the building’s unappealing architecture, unconventional construction and odd configuration greatly hindered any cost-effective renovation/ remodeling compatible with most commercial uses.

Analysis indicated the property’s uniqueness essentially precluded an ability to cite comparables. To compensate, the appraiser strove to meticulously detail the path followed to value. Included were a cost-approach analysis and a discussion of desirability in the market. In the end, the appraiser determined the building lacked any desirability, had no value whatsoever and should be demolished, the cost of which decreased the value of the underlying real estate.

While we concurred with a good portion of the appraiser’s reasoning, we found one important fact had been overlooked ― the building was rented and producing significant cash flow. Accordingly, the building had value under the income approach, which value the appraiser ultimately acknowledged had not been considered. When the appraisal was eventually adjusted to factor that data into its calculations the property value escalated to slightly less than $700,000, an amount agreeable to the seller.

The bottom line: Read the appraisal completely.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

Real Estate: Is The Fix-Up Worth It?

April 20, 2014

 Addition Renovation

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BOTH THE FAMILY HOME AND YARD ARE TOO BIG for the two of you. With the children grown and on their own you want to sell then buy a home with real estate that is smaller, easier and less costly to maintain. And now that you’ve decided to sell you also want a fair price and a speedy transaction. Are there things you can do to make that happen?

Of course, if you have time to wait, the money to spend and limitless energy there are a myriad of things you can do to create excitement, sizzle and glitter for the house. Perhaps a recreation room, gym or other amenity could be constructed, or a swimming pool or ice skating rink installed in the backyard. But for many the prospect of lengthy periods of time, hefty expenditures and exhausting effort to prepare a home for sale are problematic, to say the least. Moreover, costly improvements not only may be unnecessary, they may not sufficiently raise the value of the home to justify the expense or the time to complete them.

So what can be done to improve the chance of a quick sale, if anything? Assuming the home and yard are not in need of major repairs (such as leaking roof, structural damage from uneven settling, collapsed cesspool, etc.), are in mostly presentable condition and other things are equal, having tasks performed that generate a comfortably neat home and yard appearance should suffice. For example: Cleaning, painting and sprucing up the home’s interior and exterior; the lawn seeded/ mowed/ edged; bushes/ trees trimmed and pruned; and flower beds weeded. Such undertakings are often minimal cost items that should aid in producing an attractive first image for your home.

Still, an older home that has been maintained in good condition with serviceable though passé appliances, out of style cabinets/ wallpaper/ carpets and/or similar detractions may meet with buyer resistance. In such a situation a negotiated mutually agreeable price adjustment could be the equalizing factor that helps develop the sale. However, markets for real estate and houses differ. In some locales price may be less important than pizzazz. Elsewhere the yard size, number of bedrooms or other factors/ elements/ issues may affect a sale. For these reasons a qualified and reliable real estate agent familiar with your area should be considered to assist you through the process.

Nonetheless, in many neighborhoods an attractively maintained home in good condition selling at a fair price is usually viewed as being in a great position to be placed on the market.

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Need consulting, coaching or problem troubleshooting regarding other single-family or multi-family housing issues? We’ll be pleased to help you. Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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Blog Terms of Use and Disclaimer: The purpose of this blog is to promote awareness and general discussion of the presented topic. Use of this blog shall be the reader’s agreement this blog is not a substitute for the advice of a qualified professional and each action that may be taken shall be under the specific guidance and oversight and/or performance of a professional qualified in the subject matter. If you have a question or want assistance with a featured or related matter please contact us at InhouseCo@aol.com (include the blog article title on the subject line). Links, references and credits in this blog are for convenience only and are not endorsements by the author or Inhouse Corporation. Statements and/or opinions of guest authors may or may not reflect those of Inhouse Corporation.

When The Money Tree Wilts

April 13, 2014

Money Tree

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ALL OF US RUN INTO A CHALLENGING MONEY SITUATION AT ONE TIME or another. Its almost an inescapable part of modern life. As property managers we often become aware of renters/ residents struggling to meet expenses, particularly after some life-altering event, such as the loss of a job, a health problem or family emergency. These are unfortunate and regrettable circumstances over which few  have little, if any, control.

When such things occur most renters apparently are too stressed, emotional or embarrassed to talk about a reversal of their finances. This is fully understandable since one’s fiscal matters are generally viewed as personal and private. So most will try to slug it out on their own. In the meantime, if rent payments start to suffer and the resident is silent as to why, the property manager likely will conclude rent is deliberately being withheld and take the appropriate actions, which adds to the expense and stress levels. Moreover, as the manager watches rent payments arrive late, are partially paid or not paid at all, the time has passed for the resident to reorganize his/her finances and have a better chance at avoiding the fees that result, making the situation even worse.

Sure the rent still needs to be paid, but when a resident willingly discusses his/her economic difficulty with our property manager, and does so in a manner that allows the manager time to offer helpful suggestions,  we usually recommend one or more community organizations that can aid and/or work with him/her. Often the approach is to create and maintain a realistic household budget that can cover necessary expenses out of the resident’s remaining income. Sometimes we will teach household budgeting to residents where such training is unavailable through community groups. However, working with a community group usually is more beneficial to the resident in that it provides guidance while soothing the anxiety otherwise associated with speaking to management about the problem, and it may be a benefit to the property manager if it can appropriately side-step an eviction and resulting vacancy.

Of course, not all property managers will react the same way though we think most responsible managers are likely to view sufficient advance warning of a resident’s fiscal problem as an opportunity to assist that resident avoid the consequences of nonpayment. As professional property management, we do.

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Need coaching, training or problem troubleshooting regarding other housing issues? Visit us at the Inhouse Corporation website or contact us at inhouseco@aol.com

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