Another installment of ‘Honey, can I…?’

Honey, Can I convert the garage to more living space?”….Just say ‘No’

NOTE: I read this article and appreciate the sage advice; but, as you know, decisions about your home and your money are ultimately yours.  Like the kio pond in the living room, there is no right & wrong.  Just understand the impact!  So, read on to see what Blanche Evans has to say about the value of your garage for your Buick rather than for Barcalounger!

One of the biggest reasons that people buy homes instead of continuing to rent is to have more space. But the cost of buying with little money down or to move up to a better neighborhood could mean a compromise on space. Many older homes, particularly those built before the 1990s, average less square footage than newer homes. One way homeowners get more space is by converting the garage. The average garage is approximately 20 by 20 feet. Converting it gives you approximately 400 more square feet of living area. The location of the garage is ideal. It’s already under the roof and walled on three sides, making it relatively inexpensive to remodel as a den or a guest suite.

And that’s where your plans can go wrong.

Unless you remodel the garage from the outside, it will always look like a conversion. The driveway will lead to,,, a wall, so it will have to be remodeled, too. You’ll have problems on the interior, too. The floor will be lower than the rest of the house because it’s a concrete slab. It isn’t insulated like the rest of the house, so there will be a noticeable difference in sound absorption and temperature.

Where you’ll encounter the most difficulty is in determining your home’s value. When you purchased the home, you paid so much per square foot. Only living space is counted, which doesn’t include the garage, porch or patio, even if they are under the roof. You’ll get more living space for less per square foot, but when it comes time to sell your converted home, get ready for mixed reactions from buyers.

  • Many will refuse to even look at your home.
  • They want the security, storage, and utility of a garage.
  • Others will consider your home but they will punish the lack of a garage with a low offer.
  • Some will refuse to count the square footage of the garage as equal to the rest of the house.
  • Others will deduct the cost of reconversion or building a new garage in their offer.

No matter how you count it, square footage added at the cost of a garage isn’t worth it.

~~Blanche Evans, Realty Times Feature Writer 02/13/2014

Good to know. Good for Holliston.

We’re proud to announce that we now have a brand new name:

Berkshire Hathaway HomeServices Town and Country Real Estate

We are extremely excited about this change. It’s a good sign for the market and a great sign for buyers and sellers looking for the highest levels of professionalism, experience and knowledge of real estate in your area.

Try looking at the Boston real estate market using our new site.  You’ll love it!  Whether you are looking for a home, thinking of selling, or just keeping up to date on the status of the real estate market in your area, Berkshire Hathaway Homeservices Town and Country has the best possible tools!

If you have any real estate needs or questions on our new brand, call or email me.  774-217-0406

Honey, Can I put a built-in Koi Pond in the livingroom?

With the new year comes the resolutions and with the resolutions come decisions.  The category of your pending commitment will inevitably fall into one of 2 categories:  Health or home.  Health – Eat less, move more.  That one is pretty straight forward.  Home has a few more options.   Websites and Realtors alike will erupt with recommendations.  They’ll preach the BEST home improvement projects and the WORST.   But it isn’t their home and it certainly isn’t their money, so how do you decide what project to undertake?

There are a number of great sources to evaluate the rate of return on home improvement projects.   They can tell you the financial intelligence of pretty much any common home improvement.  For instance, did you realize that, in our part of the country, if you replace your front door with a new steel door, you’ll recoup 85.6% of the cost?  Replace it with a fiberglass door and you’ll only recoup 65.1%.  If you’re first reaction to those statistics isn’t, ‘How the heck do they know?’, then you’re pretty normal.  How do they know?  These lists are assembled using a combination of surveying Realtors, market research, and remodel analysis  The most respected and commonly referenced list is by Remodeling’s Cost vs. Value report (that link will bring you to the freshly released 2014 numbers).  Home values are compared with and without a given improvement –  Completed project costs are compared against the delta in home value – The numbers are crunched and analyzed.  Values are compared vs other years and other parts of the country.  It is all very interesting and very clinical.  If you are a contractor looking to flip a home for profit, these numbers are your bible.  But if you are a home owner, looking to both enjoy your home and make financially responsible project investments, these number are your conscience.

The reality is your home improvement decisions will be a much more subjective evaluation.  They are a combination of what I would call the FI, Financial Intelligence, of the project combined with my favorite microeconomics concept: Utils.  Utils are the intangible, unquantifiable concept to quantify the notion of Utility.  Not utility as in your electric and water services, but utility as the concept of happiness provided to a consumer.  Utils are the units measuring the value of the happiness provided to you as a consumer.  Nice.  It is what makes me spend $2 for a cup of coffee – I know that the actual value of that coffee & cup is only about .50 but I place value on the happiness of having that hot coffee in my hand.  For me, the utils of this purchase are more valuable than the $2.  And so I am actually happy to spend.

Clearly in the example I provided, the financial impact of my utility driven decision to purchase overpriced coffee is relatively benign.   When it comes to home improvements, the financial impact can be significantly more devastating.   Let’s look at a strictly utility driven home improvement project.   Say you always wanted a massive built-in Koi pond in your living room.    The reason you did the project was because the utils were high and you felt they out weighed the FI of the undertaking.  I don’t think we need to do any cost analysis to know that will hurt resale, it will be painfully expensive, and you’ll probably take a few inadvertent night-time foot baths when trying to get to the kitchen.

Probably won't improve resale!

Probably won’t improve resale!

How can you use this information to help you be a more responsible and yet still happy homeowner?  Balance.  You need to simply balance your FI with your urge to over value your utility.   As part of your util assignment, you need to consider how long you plan on living in the home and how large your budget is.  The longer you plan to remain in the home, the more emphasis you could allow yourself to put on utility.  If you think you’ll be selling soon or if you want to have re-sale drive all of your decisions, you need to think more along the lines of FI.

I hope this gives you something to think about as you plan your home improvement projects for spring.  And, if you decide to build that interior kio pond, please send me pictures.

This is a wonderful interactive graph of the best and worst remodeling ideas from 2013.

http://chicagoagentmagazine.com/10-best-worst-home-remodeling-projects-2013/

The Secret is Out

The Secret is Out!!

We are bringing the excellence and professionalism of Berkshire Hathaway to real estate!  Prudential Town and Country is the first firm in Massachusetts to transition to BHHS.  It is a good sign for the market and a great sign for you.  Contact me to discover how you can benefit from BHHS for all your real estate needs.

Check out the recent article in Banker & Tradesman to learn more.  http://www.bankerandtradesman.com/news157697.html

 

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Now That is Good News!

 

During the holiday season, good heart warming news is always welcome.   Lately, there has been plenty of real estate reports of an overall stronger market.   That’s good news but not really heart warming.  There has been healthy steady change over the past year that supports the notion that real estate is, once again, becoming a solid long term investment.   That too is good news but I’m still not feeling that warm glow.   Prices are generally returning to healthier levels not seen since 2005.  That one actually makes my wallet warmer than my heart.   So what kind of real estate data is also feel-good data?

Today, as if data analysts wanted to give me a little Christmas gift, I found a statistic that did warm my heart.   It was written up briefly at the end of October but buried away in the many tid-bits released by the Warren Group.  It was the fact that, after years at outrageous levels, foreclosure numbers in Massachusetts are trending down by quite a bit.   In September, the number of actual foreclosures statewide decreased by 52% from September 2012.  The total number of foreclosed deeds from January through the end of October in 2013 was 2,382 compared with 6,491 for that period in 2012 (that’s a 63% decrease).    Equally important and indicative, the number of foreclosure petitions has decreased 70% year to date over 2012.

There are 2 ways to look at those numbers:  There is sadness that so many people are still losing their homes to foreclosure.  But there is also encouragement from the idea that the numbers have decreased so dramatically.  These figures mean that over 4000 fewer homeowners have found themselves in financial dire straights this year; it is a wonderful start.   4000 people that will enter this holiday season ready to fill their homes with love and hope.  Now, that is good news.

Looking for a quick snapshot of October’s real estate numbers for Holliston?  Click below

October2013Data

 

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Fall Market Stays Strong

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In September, the Greater Boston Real Estate Board reported that sales of detached single-family homes in the Greater Boston area rose on an annual basis for a third consecutive month, increasing 21%. That made this the 5th busiest September on record (matching activity in 1999). The Massachusetts Association of Realtors followed that report just 3 days ago, on November 22nd, reporting that October’s numbers continued the upward trend.

This strong sales growth can be attributed to a number of factors:

  •  a more motivated home buying public
  • concerns about higher home prices
  • concerns about rising interest rates
  • and an increasingly tight supply of homes for sale

Here in Holliston, we see all these factors at work. The number of closed sales continues to be UP compared with the same time last year. But this year’s inventory is still down over 40% . As a result, well priced homes are on the market for shorter periods of time and sales have not suffered from a fall slowdown.

If you are looking to BUY in Holliston, have your financing pre-approved & be prepared to make an offer when you find something you love.

If you are looking to SELL, remember, price & presentation! A well priced home with proper presentation will move quickly no matter what the price point!

Call or email me if you would like to discuss the market and how it affects you. I would be happy to provide a free analysis of your home’s value.  If you have any thoughts on the market or personal experience to share, please feel free to comment about it.