Minneapolis Makes Forbes Top 3 in “America’s Best Cities for Couples”

 

With rents in many cities skyrocketing, men and women marrying later and a divorce rate for first-time marriages that hovers at about 45%, it’s no wonder more American couples are deciding to shack up.

There were an estimated 6.02 million unmarried-partner households in the U.S. in 2006, according to the Census Bureau’s latest research. This number includes 779,867 same-sex households. When the census began measuring unmarried partners in 1996, there were only 2.86 million opposite-sex couples.

Though you likely know at least one cohabiting pair, unlike their married and single peers, unmarried couples are not an easy group to quantify. They cannot check the single or married box truthfully, and there is little but a shared address to signify their official commitment.

But couples who live together have needs, too. In the Forbes.com roundup of the best cities for couples, they’ve identified what this growing demographic requires to maintain a stable relationship while on the path to marriage or something less traditional. They selected the country’s 40 largest metropolitan areas and collected data on marriage and divorce rates for the 20- to 34-year-olds who live there, the affordability of a starter home, the area’s income disparity and the availability of family counseling. 

Dallas, the city made famous on television for its scheming lovers and dysfunctional relationships, topped the list. Four other Texas cities are in the top 10: Houston, Austin and San Antonio. Cities at the bottom of our list, with low marriage rates, high income disparity or poor housing affordability, included Cleveland, Providence, R.I., and Miami.

Top 5 cities for couples

1. Dallas
2. Houston
3. Minneapolis
4. Denver
5. Austin, TX

You can see Forbes’ full slide show of best cities for couples here.  Full Story

 

Energy Audits to Inspections: Helping Homeowners Maintain Value

With reports that foreclosures are up 51% from 2006 and that home ownership took a record plunge in 2007, RISMedia says it’s clear that 2008 will be a year of economic uncertainty, and at worst, a year of continuing downturn. As consumers continue to feel the squeeze, the American Society of Home Inspectors (ASHI) reminds homeowners and those eager to sell to look to ASHI Certified Inspectors when considering options for buying, selling or maintaining their home in a down market.

“ASHI has taken steps to arm its members with the resources and support to provide a diverse range of services for homeowners,” said Brion Grant, 2008 ASHI president. “We know that one-size doesn’t fit all in this market. From energy audits to maintenance inspections, phased-inspections and more, we’re arming members with tools to diversify their services so that they can meet the needs of the public.”

New Services for Homeowners

Energy audits are among the core services that ASHI is encouraging its members to fine-tune so consumers have the benefit of potential cost savings. In December, members of ASHI’s Blue Ridge Chapter (Virginia) participated in group training with a nationally certified energy auditing company to secure certification to perform energy audits in their region. “With the cost of fuel skyrocketing, energy audits can uncover inefficiencies and point to savings,” added Grant. “ASHI is working in conjunction with a certifying organization to provide opportunities for training and certification so that its members can offer this ancillary service nationally.”

Another service homeowners may not think about is maintenance inspections.

“Maintenance should be at the top of every seller’s list this year, said Grant. “In this market, home buyers have more properties to choose from, and will look closely at how well a home has been kept up.”

Homeowners who are serious about selling their home in 2008 should consider hiring an inspector to conduct a maintenance inspection, which includes checking everything from the foundation, roof and gutters, to a home’s exterior and interior walls, electrical wiring and plumbing. ASHI also offers a maintenance checklist, a list of items in the home that should be maintained annually or by season. Those interested in obtaining a copy of ASHI’s home maintenance checklist should contact a local ASHI Certified Inspector via ASHI’s Website http://www.ASHI.org.

Services for Buying or Building a Home

With a record 2.18 million homes sitting vacant and sellers chomping at the bit to unload their home, buyers are at risk too. Before purchasing a home, ASHI encourages buyers to hire an inspector to conduct a pre-sale inspection to determine its quality, efficiency and safety. “There are a lot of people who are willing to do whatever it takes to sell their homes,” said Grant. “In a market like this, people are quick to jump in because of the rock-bottom price rather than the quality and safety of the home.” And, with many bank-owned properties being sold “as is,” meaning the seller will not be performing any repairs, pre-sale inspections can provide vital information about costly defects.

Phased inspections are also a good way to protect the interests of people who are building a home from scratch. By engaging a home inspector early on, even in the site selection, homeowners can benefit from having an inspector assess the quality of construction at every step. From pouring the foundation, to closing the walls, home inspectors can provide an unbiased assessment of a home that will save homeowners time and money.

“I wish forecasting the future was as easy as picking up a Magic 8-Ball,” said Grant. “‘Outlook good’ would be a welcomed relief from what we’ve seen over the last year. But Americans are resilient, and ASHI is committed to helping homeowners weather this storm.” Full Story

 

Consumer Confidence or Downright Denail?

Despite repeated highly publicized reports of a home sales slump and pricing slides, there’s a surprising amount of positive consumer sentiment, says RISMedia — and perhaps a good measure of homeowner denial as well: Even in a negative home pricing environment, 77% of homeowners from around the country believe the value of their home has increased or remained the same in 2007, according to a recent Zillow.com survey conducted by Harris Interactive(R).What’s more, sizable fractions of all homeowners — not just those who believe their homes appreciated in 2007 — say they are planning to do things in 2008 — even before the Fed’s latest interest rate cuts – that you might not expect during the housing, construction and credit slumps:

– 82% will spend the same or more on minor home improvements (install new garbage disposal, repaint or wallpaper a room).
– 67% say they will spend the same or more on major home improvements (replace the roof, remodel the kitchen) this year.

– About a third say they are more likely or equally as likely to:
– Take out a home equity loan (35%)
– Refinance their mortgage or take out a second mortgage (36%)
– Sell their homes (34%)

How Bad It Is in the Reality-based World

The Zillow(R) Q3 Home Value Report says U.S. home values dropped 5.7% nationwide year over year (2007 to 2006). Zillow plans to release its Q4 report Feb. 12 and preliminary results indicate home values in most U.S. markets have continued their descent. In a recent report, Merrill Lynch predicted “housing prices will remain in free fall,” declining 15% in 2008 and 10% in 2009, “with more depreciation likely beyond the forecast period,” even if the Federal Reserve continues to cut interest rates.

How Homeowners Perceive the Situation

About a third of homeowners (36%) in the Zillow.com Home Value Survey said their homes had actually increased in value during 2007. Zillow’s Zindex(R) data proves the contrary, showing median value declines across regions as of October 2007.

What’s Driving Homeowner Perception?

“This survey reveals that despite the data to the contrary, people either aren’t paying attention to their housing market or are in denial about their own home’s value,” said Dr. Stan Humphries, Zillow.com vice president of data & analytics. “This likely reflects the fact that most Americans have not realized home-related losses because they’re staying in their homes. Even in declining markets where a greater percentage of new homeowners are underwater on their mortgage, it’s important to remember most people are not really affected by declining values unless they absolutely must sell or need to immediately refinance or withdraw equity. This has contributed to the healthy investment intent, particularly in home upgrades, despite the downward trending markets.”

How to Stay on Top of a Home’s Value?

Zillow recently increased its database of homes with Zestimate valuations to 67 million, which equates to about three out of four U.S. homes. People can easily check a home’s value by visiting Zillow.com and typing in an address. Full Story

 

Money Moniter: Keeping an Eye on Energy Costs

 

Though by no means ubiquitous, household energy monitors have been around
for some time. A few new entries into the space, however, add a splash of colour and style to make understanding energy consumption more intuitive according to this little round up from the folks at Springwise.

Wattson, first of all, is a sleek, aesthetically pleasing device that shows homeowners through both numbers and colours how much energy they are using in their home. Consumers begin by attaching to their electricity meter or fuse box a transmitter device, which can measure both single and 3-phase systems. That, in turn, beams information directly to the freestanding wattson device elsewhere in the house, where it instantly displays current usage. Wattson’s LED display can represent energy use in euros, dollars, yen or pounds, while its pulsing, coloured light also reflects the amount of electricity being used, ranging from cool blue for small amounts to red for high energy consumption. The wireless wattson display is portable, and when appliances are switched on or off, it indicates how much energy they use. Homeowners can store up to 4 weeks of energy-use history on the device and download it for analysis on software that comes included; a forthcoming community feature will let wattson owners compare their usage. Wattson was listed in Stuff Magazine’s “Cool List” of the top 10 gadgets of 2007. It is priced at GBP 149.50 from UK-based DIY KYOTO.

The Home Joule, meanwhile, resembles a nightlight and plugs into any outlet in a home. The device displays not just energy usage, broadcast wirelessly by the consumer’s energy meter, but also the real-time cost of energy, which comes wirelessly from the energy company. The color of light emitted by the device represents the costs of the moment, with yellow and red light indicating expensive energy costs, while green means energy is cheaper. The idea is that consumers can then modify their consumption accordingly, switching off discretionary appliances at peak times of the day. The Home Joule is from Ambient Devices and is currently available only to customers of Consumer Powerline’s demand-response program.

Finally, though not truly an energy monitor, Ambient‘s beautiful Energy Orb also emits different colors of light to represent pricing information. This time, however, the device emitting the light is an egg-shaped orb that plugs into an outlet. The Energy Orb has been adopted by Pacific Gas & Electric and other US energy companies, and is priced at $149.99.

With energy prices heading nowhere but up, so, too, will demand for devices like these.

 

Renter Relocation: In Search of a Better Cost of Living

RISMedia recently reported that the two key factors driving more than half (55%) of renters to move in 2008 are relocating for a job and reducing the cost of rent, according to a national survey from Apartments.com to current renters. Almost half of renters (48%) surveyed said they are moving to another city or state.

These 2008 moving trends also collaborate with recent workplace findings that fourteen percent of employers are willing to pay to relocate new employees, from another area to their company location, this year compared with last year, according to a joint survey by CareerBuilder.com and Apartments.com.

For renters planning to relocate this year, Forbes, in its 2008 report of the Best And Worst Cities For Renters, lists the following cities as the most affordable for renters:

1. Columbus, Ohio
2. Indianapolis, Ind.
3. Kansas City, Mo.
4. San Antonio, Texas
5. Cincinnati, Ohio
6. Saint Louis, Mo.
7. Cleveland, Ohio
8. Houston, Texas
9. Dallas, Texas
10. Salt Lake City, Utah

Ninety-five percent of renters surveyed plan on moving in 2008. Only seven percent are moving to buy a home, and almost all are scaling back on overall moving expenses. Seventy percent will not hire a professional moving service. Story

 

Homeowners Insurance: 12 Tips for Lowering Your Premiums

You can save money on homeowners insurance if you know how. Discounts from your insurance company are available for a variety of reasons, ranging from the type of building material used to build your home to how close you live to a fire station. Here are 12 tips from Insure.com to help you save money on your homeowners policy:

Shop around. Check with several different insurance companies to get rate quotes. Do your friends or family members like their insurance company? Get online quotes from sites like MSN Money.

Raise your deductible. The deductible is the amount of money you have to pay toward a loss before your insurance kicks in. Typically, deductibles start at $250. Increase your deductible to:

• $500 and save up to 12% on your premiums.
• $1,000 and save up to 24%.
• $2,500 and save up to 30%.
• $5,000 and save up to 37%.

Just make sure you can afford to pay the higher deductible if something should happen.

Buy your home and auto policies from the same company. Many companies will give a discount if you buy both homeowners and auto coverage from them.

Consider insurance consequences when buying a home. If you’re looking at buying a home, think about the cost of insuring the home. A newer home’s electrical, heating and plumbing systems, and overall structure are likely to be in better condition than those of an older home. This can lead to a discount on your premiums.

Also consider the construction of the home and your geographical location. If you live on the East Coast, you’ll want the house to be able to stand up to wind damage; on the West Coast, you need to keep earthquakes in mind.

Insure your home, not the land. Although your home and its contents are at risk from fire, theft, windstorms and other perils, the land your house sits on is not. Don’t include the value of the land in deciding how much homeowners insurance you need to buy.

Improve security and safety. Items such as deadbolt locks, burglar alarms and smoke detectors often bring discounts of 5% each, depending on the company. Your insurance company may also offer a significant discount of 15% or 20% if you install a sophisticated home-security system. If you’re thinking about buying such a system, check with your insurer to see which systems they recommend and which will earn you a discount.

Stop smoking. Smoking accidents account for more than 23,000 residential fires every year. Some insurers offer to reduce premiums if no one in the home smokes.

Senior discounts. Insurance companies have found that retired people stay at home more and spot fires sooner than working people. Older people also have more time for maintaining their homes. If you’re at least 55 years old and retired, you might qualify for a discount of as much as 10%.

Group coverage. Alumni and business associations often work out insurance deals with an insurance company, which includes a discount for association members. Ask your association’s director about any such deals.

Stay with an insurer. If you’ve kept your coverage with a company for several years, you may receive special consideration. Several insurers will reduce their premiums by 5% after you’ve been with them for three to five years, and some companies will discount you as much as 10% after six years.

Check your policy annually. You want your policy to reflect the value of your home and belongings. If you review your policy every year, you will be able to make the necessary adjustments. If, for example, you just sold a valuable painting, you won’t need the same amount of coverage. But if you added a garage, you’ll need to increase your coverage.

Look for private insurance first. If you live in a high-risk area (one that is especially vulnerable to coastal storms, fires or crime) and think you’ll be forced to buy homeowners coverage from your state’s high-risk insurance pool, check first with an insurance agent. You may find that you can still buy insurance at a lower price in the private insurance market than from the insurer of last resort. Story

 

Which is Right for You? Buying vs. Renting

 

No one knows what the future holds for you, your family, your job or your finances. But Bankrate.com can help you understand what you’re going to encounter when you embark on the sometimes-difficult journey toward the American Dream of owning a home.

When you get that urge to buy a house, the first thing to do is step back and ask whether it makes more sense to keep renting for a while. If you still want to buy, you need to figure out how much house you can afford. Here’s what they have to say…

Economic differences between renting and owning
If you’re looking for the best return on your money, historically you’re better off investing in the stock market than buying a house. Primary homes generally don’t earn the investment return of financial instruments such as mutual funds. While the stock market’s long-term average rate of return is in the range of 8 percent to 10 percent, housing historically has appreciated on average in the low- to mid-single digits. Don’t buy solely for investment gain.

On the other hand, Uncle Sam helps out by letting taxpayers deduct part of the mortgage interest and real estate taxes each year. Borrowers get the benefit only if they pay enough in one year to exceed the standard deduction. But that usually happens, especially during the first few years of a mortgage when most of each payment goes toward interest rather than principal.

Sunny side of homeownership
Owners enjoy other benefits, too. They build equity over time as home values rise and their mortgage balances shrink. They also don’t have to worry about their housing costs shooting through the roof because lenders can’t boost borrowers’ rates and payments, unless those borrowers have adjustable-rate mortgages.

Cloudy side of homeownership
When something breaks at an apartment, it’s the landlord’s problem. When it’s your name on the deed, the problem is yours. If you throw every penny into a down payment, you’re taking a big risk because you may not have enough money left to fix leaky pipes or buy a new air conditioner.

Potential buyers might want to hold off for other reasons. If there’s a good chance that you will be laid off soon, you might want to wait. The same goes for people who plan to leave a job soon. The monthly payment isn’t the only obstacle for this kind of customer. Closing costs and other home-buying fees, as well as the commission that most owners end up paying to real estate agents when they sell their homes, add up. People who have to sell after living in one place for only a short time can end up in the hole on their investments.

Explore all the options
Some middle-ground approaches to homeownership blend elements of buying and renting. Some of the more popular loan types are seller financing, “lease with an option to buy” and “contract for a deed” plans

Seller financing
With seller financing, the seller actually assists the buyer in purchasing the home, by “lending” the buyer either a portion of the amount to be financed or the entire amount.

Let’s say the buyer and seller agree on a price of $150,000 for the house. In many cases a lending institution would require a 20-percent down payment — $30,000 — and give the buyer a mortgage for $120,000. But if the buyer has only $15,000 cash, the seller could “take back” a second mortgage for the $15,000 the buyer is short. The buyer makes payments on the first loan to the bank and the second loan to the seller.

Another example of seller financing: If the sale price of the home is $150,000 and the buyer has only $15,000 for a down payment, the buyer gives the $15,000 down payment directly to the seller who agrees to carry the entire mortgage amount of $135,000. The buyer would make all payments directly to the seller.

Pro: Seller financing reduces the cash needed to get into a home and could dramatically reduce closing costs. Often the seller will be more flexible in accepting an underqualified buyer.
Con: The seller determines the interest rate for that portion of the mortgage being carried, and it usually comes with a higher rate and a shorter term. Perhaps most importantly, it very often comes with a balloon payment. This means that monthly payments would be computed as though the mortgage was to continue for, say, 30 years, but at the end of five or 10 years the entire remaining balance has to be paid in one lump sum. That normally requires refinancing at that point, when rates could either be lower, higher or about the same, or selling the house to meet that balloon payment. Story

 

Offbeat Options for First-Time Homebuying

So you want to buy a place of your own but can’t figure out how to pull together the necessary cash and financing? If you’re willing to think creatively, MSNMoney offers us seven offbeat options for buying your first home:

1.  The Fixer Upgrade – When you can’t afford what you want, look for what you can afford and use it as a stepping stone.
2. The Shared Load – If buying your own property is prohibitive, consider buying into a dwelling with shared ownership. There are several options here, with varying levels of complexity and commitment. One of the most common uses a legal form of ownership called “tenants in common.”
3. The Friendly Option – If you don’t want the legal hassle of setting up a TIC, it’s possible to buy a property with a friend you trust, sharing the mortgage and the title. This form of ownership is called joint tenancy, and it’s the way most married couples hold property.
4. The Instant Neighborhood – Cohousing has its origins in Europe and is practically like buying a neighborhood along with your house. Residents own one of a group of small homes clustered together and share ownership of the land.
5. The Parental Plan – Saving enough for a down payment usually requires some kind of a sacrifice, so don’t rule out living with family.
6. The No-Money-Down Hail Mary – It can be tough to save enough cash for a down payment, but in certain circumstances you can finance your way around it.
7. The Susu Super-Saver – This simple saving strategy goes by different names in different communities, but the method is the same. Members of a “susu” contribute a fixed amount each week or month for a certain period (e.g. $200 a month for 10 months). At regular intervals, one member gets a specified payout in cash.  

Read the full story for examples, pros, and cons of each of these offbeat options 😉 

 

More Mortgage Basics for Homebuyers

Adjustable or floating rate, 15-year or 30? How much mortgage can you afford? These are just a few of the many questions home buyers will find information on in Yahoo! Real Estate’s How-to Guide of Mortgage Basics.

So before you start mining for the perfect mortgage, make sure you have an understanding of the options available to you and check out their report. Some highlights include the following:

• The first step in acquiring a home mortgage is to gather the information you’ll need to include in a mortgage application.
• Review your credit report by ordering a copy from the credit bureaus used by local mortgage lenders.
• Prequalifying for a mortgage lets you know how much you can afford and makes you a more attractive buyer.
• Conventional mortgages limit housing costs to 28 percent of gross income and total debt payments to 36 percent of gross income.
• Mortgage terms are usually 15 or 30 years. The longer the term, the lower your monthly payment, but the higher your overall interest costs.
• Thirty-year loans often permit additional principal payments. One additional monthly payment per year will reduce a 30-year loan to 22 years.
• Interest rates are fixed or variable over the term of the loan. Variable rates may be best for buyers who plan to sell within three years.
• Generally speaking, one point is worth 1/8 of 1 percent off the loan rate.
• A balloon payment is a lump sum payable at the end of a specified term.
• Points and interest on mortgages or home equity debt are usually tax deductible.

 

Noteable Quote: Recession-proof market? They do still exist!

In a recent article in the Salt Lake Tribune, Dana Williams (Real Estate Broker and Mayor of Park City, UT) made an interesting comment on a place where two out of every three dwellings are second homes… 

“In tough economic times, when there is a downturn in the economy, people tighten their belts and don’t buy second homes. But the multimillion-dollar homes, nothing affects that market. They’re recession-proof. And they usually aren’t purchased with mortgages.”

Tom Green and his fiancee Laura Gilbreath pose for a portrait. Tom Green’s 8,500 square feet, $10 million house in upper Deer Valley. Green lives in Austin, Texas and is used to work as general counsel for Dell Computer Corp. (Chris Detrick/The Salt Lake Tribune)

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