3 Front Door Styles Real Estate Agents Love to See

 
Credit: David Papazian/Shutterstock.com

Credit: David Papazian/Shutterstock.com

 

If every home tells its own unique story, then the front door is the introduction. For that reason, realtors love a good-looking, well-cared-for front door, because it helps tee up expectations for what’s to come inside the home. A home with a cherry-blossom-pink front door? You know that home tour won’t be boring! Swinging pivot doors that operate on a spindle? You’re stepping into the future.

While real estate agents all have their own personal preferences for front door colors and styles — some of which are influenced by the region (and climate) where they’re selling properties — there are a few features they agree are great. (Windows, ftw!)

Here, realtors from across the U.S. share the front door styles they love seeing the most — and will give you extra curb appeal points.

A Dutch Door 

Traditionally, Dutch doors are divided in half horizontally, allowing the bottom to remain shut while the top is open to let in a breeze (or facilitate a socially distant conversation with a neighbor). Secure a latch and it transforms into a traditional door. AJ Olson Whitfield, a realtor with Villa Real Estate in Orange County, says her favorite door style is a modified version of the Dutch door. Instead of a divide in the middle of the door, the split is higher up.

“You still get to enjoy the breeze and the look of a Dutch door, but you have privacy because the bottom panel is higher,” she says.

Interestingly, the Dutch door style is one that’s catching on indoors as well, according to Simpson Door Company. Chalk it up to the new normal of remote work, where you may need to keep your pandemic puppy or young child from dropping into your office unexpectedly while on a Zoom call, but can still keep tabs on your household with the top open.

Doors with Windows 

Glass windows on your front doors come with pros (like letting the sunshine into your entryway) and cons (people seeing inside). That’s why realtors tend to be drawn to front doors that strike a balance with strategically placed windows.

“I like styles that have some windows that are either high up or have skinny vertical slats of windows to allow for privacy,” says Deb Tomaro, an Indiana-based realtor. 

Ellen Schwartz, a licensed associate real estate broker with Compass in New York, is also on Team Window. “My favorite front door is a door with lots of glass,” she says. “I myself have a glass door with 12 panes of glass with divided light. I like when a front door allows light into the home.”

Brandon Thomas, a Maryland-based strategic real estate advisor with Real Estate Bees, says his favorite is a country-style door with a small window. (Think: A wooden door with a small half-circle window at the top).

“It just makes the home feel a little more cozy, even from the outside looking in,” he says.

A Pivot Door 

Want a door where you can really make an entrance? Take a look at pivot doors, suggests Daniel Milstein, with Aaron Kirman Group at Compass in Los Angeles and Orange County. These sleek, design-forward doors are the best match for contemporary homes. Instead of hinges, these bigger doors typically have a pivot point at the floor that allows them to rotate.

A final note: When you’re looking at doors (or want to switch yours out to upgrade the curb appeal) you’ll also want to consider comfort and security in addition to style, points out Michael DiMartino, senior vice president of installations at Power Home Remodeling. Be on the lookout for the door’s U-factor, he recommends, which assigns a number to the rate a door conducts non-solar heat flow.

“The lower the number of the U-factor, the better the door’s insulation,” DiMartino says.

Keep reading on Apartment Therapy.

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7 Ideas to Cover Your Next Down Payment on a Rental Property

 
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For most real estate investors, cash for down payments is the bottleneck.

The choke point, the constraint that sets the speed limit on how fast you can build your rental portfolio. This means if you want to grow your portfolio faster, you need to solve the down payment problem. 

Whether you're buying your first property or your 14th, try out the following ideas to make real estate investing more affordable.

1. HELOC or RELOC

While homeowner mortgages don't typically allow you to borrow any part of the down payment, investment property lenders do generally allow it, which opens up several opportunities for borrowing your next down payment. If you have a home equity line of credit (HELOC) on your primary residence, you can draw on it to source your next down payment. It makes for a flexible way to borrow and pay back the debt on your own schedule.

Many landlords don't know that they can also take out HELOCs against rental properties with equity. I call these "RELOCs," but I'm not sure anyone else does. Regardless of the property type, know that you can tap existing equity not just to finance property upgrades, but also to cover your next down payment. 

2. Cross-Collateralize Existing Properties

Another way to tap existing equity is to put another property up for collateral. The lender puts a lien on both properties in lieu of collecting a down payment. 

It works like this: Say you have a property worth $100,000, that you only owe $40,000 on. You want to buy another $100,000 rental property, but the lender asks for a 20% ($20,000) down payment. Instead of coughing up $20,000, you offer to let the lender cross-collateralize your existing property with $60,000 equity in it. 

They put a lien against both your new property and the old property with equity, and lend you the full $100,000 purchase price. That flexibility is part of what you pay for when you take out a hard money loan or a rental property mortgage from a portfolio lender. 

3. Use Unsecured Business Credit Lines and Cards

Don't have other properties with equity? No sweat. As a real estate investor with an LLC, you qualify for business credit cards and credit lines. These creditors may review your business credit, but just as often they focus on your personal credit, particularly if you haven't established business credit yet. 

I've used credit cards to finance a property purchase and renovations before. You can buy the materials directly on credit cards with no penalty, and many contractors now accept credit cards, perhaps with a 2 - 3% convenience fee. Even a 3 - 4% cash advance fee is often cheaper than the total fees charged by hard money lenders or rental property mortgage lenders. 

4. Seller Financing

An oldie but goodie, you can always try to negotiate a seller carryback, also known as a seller-held second mortgage. 

Say your rental property mortgage lender requires a 20% down payment. You then approach the seller and ask them to provide you with a second mortgage to cover some or all of it, and you typically pay it back within a few years. You avoid a down payment, they score a source of passive income and earn some interest over the next few years. Win-win. And for that matter, you can even try to negotiate full seller financing as your only mortgage. 

5. Tap Into Your Roth IRA

Among the many overlooked benefits of a Roth IRA is that you can withdraw contributions tax-free and penalty-free, any time. That makes it the most flexible retirement account available. 

Of course, if you raid your Roth IRA, you miss out on future tax-free compounding. But by using the money to buy rental properties, you can potentially score even higher returns, greater compounding and the opportunity to retire early on rents. In other words, it could end up serving the same purpose, with even faster results. 

6. Partner With Deeper Pockets

As you prepare to buy your first property or two, it helps to find a senior partner. This is someone who can point out common pitfalls and mistakes made by novice investors. 

And, ideally, someone who can help cover some of the down payment. Just understand that if you don't bring experience or much money to the partnership, you'll probably need to do the lion's share of the labor to pull your own weight. 

7. Score an Owner-Occupied Mortgage

Rental property mortgage lenders require a bare minimum of 20% down, often 25 - 30%. That can add up to a massive amount of cash, for assets costing $200,000, $500,000, sometimes even $1,000,000 or more. 

But homeowner mortgages require as little as 3% down; examples include Fannie Mae's HomeReady loan programFreddie Mac's Home Possible program and FHA loans' famous 3.5% down payment. Of course, owner-occupied mortgage loans require you to actually occupy the property. Fortunately, you have several options to meet that requirement while still growing your rental portfolio. 

The classic approach involves house hacking: buying a duplex to rent one unit and live in the other—or a triplex or fourplex. Residential mortgage loans allow up to four units. You can even use the rental income from the other unit(s) to help you qualify for the lender's income requirements.

However, the options don't stop there. You could move into the property for one year—which meets lenders' occupancy requirements—and then move out, keeping the property for a rental. You can do this with single-family homes, or with multifamily properties that you house hacked. 

In fact, you can even house hack through your adult children so that they meet the occupancy requirement rather than you. As you comparison shop lenders, ask them about "kiddie condo" loan programs where you partner with your adult children on home purchases, and they move in while you stay comfortably nestled in your own home. 

Final Thoughts

You have plenty of options to finance rental properties—and just as many to cover your down payment. 

The faster you build passive rental income, the less you have to depend on your nine-to-five job. As you can cover more of your living expenses with rental income, you approach financial independence. Once there, working becomes optional, and you can spend the rest of your life doing, well, whatever you want!

For more, visit RISMedia.

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Report: 1 in 3 Veterans Intend to Purchase a Home in 2021

 
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Last year was a brutal wakeup call for most potential homebuyers in this country, U.S. veterans not excluded. According to a recent Veterans United Home Loans report, the COVID-19 pandemic forced nearly half of all veterans to change their home-buying plans in 2021.

However, the report, which highlights a survey conducted by global research firm Kantar in collaboration with Veterans United Home Loans, found that the picture is much more rosy in 2021. Veterans across the U.S. are far more bullish in their plans to purchase a home this year, with 34% of those surveyed saying they plan to buy before 2022.

"There's incredible optimism among veterans when it comes to home-buying in 2021 and beyond," Chris Birk, VP of mortgage insight at Veterans United Home Loans, tells us. "Most Veterans think this year will be a great time to buy, and about 1-in-3 are planning to turn that dream into reality. With low rates likely to linger and the $0 down VA loan benefit at their disposal, younger veteran and military buyers in particular are primed to break into the housing market."

There is also incentive for National Guard members to purchase a home this year, as a recent law that passed gives thousands of qualified members access to the VA home loan benefit. H.R. 7105, the "Johnny Isakson and David P. Roe, M.D. Veterans Health Care and Benefits Improvement Act of 2020," gives the National Guard a clear path to homeownership.

Other key findings from the report include a slight majority of veterans (51%) believe homes will become less affordable this year, while 58% expect mortgage rates to increase. Also, most veterans overestimate the kind of down payment and credit score they need for a loan. Nearly 90% of veterans believe they need at least a 670 FICO score in order to secure a loan.

Visit RISMedia to learn more.

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Why America's Housing Market Has Never Been Weirder

 
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If you think the U.S. housing market is behaving very, very strangely these days, that probably means you’re paying attention.

In almost any other year, a weak economy would cripple housing. But the flash-freeze recession of 2020 corresponded with a real-estate boom, led by high-end purchases in suburbs and small towns. Even stranger, in America’s big metros, home prices and rents are going in opposite directions. Home values increased in all of the 100 largest metros in the U.S., according to Zillow data. But in some of the richest cities—San Jose; Seattle; New York; Boston; Austin; San Francisco; Washington, D.C.; Los Angeles; and Chicago—rent prices fell, many by double-digit percentages. In many cases, the gap was absurdly large. In San Jose last year, home prices rose by 14 percent (the sixth-largest increase in the country) but the area’s rents fell 7 percent (the sixth-largest decline).

“I can’t think of a time when anything like this has happened,” Jeff Tucker, the senior economist at Zillow, said of the divergence between rental and home prices. “This is unprecedented.”

What’s going on? Some observers have pointed to the severe shortage of single-family houses that has resulted from the slower pace of building in the U.S. since the last real-estate crash. Short supply is clearly pushing up housing prices. Others point to plummeting interest rates that have encouraged people to seize the opportunity to get a cheap mortgage. And then there’s the wave of new young families seeking more permanent housing, as more Millennials enter their 30s.

These factors are all relevant. But none of them quite explains why the pandemic has created such an unprecedented disconnect between rents and home prices. Understanding this divergence begins with understanding the broader divergence of our “K-shaped” economy, in which the K represents the forking fortunes of the rich and poor during the pandemic. While many hourly workers in restaurants and physical stores have been hit hard by lost wages and unemployment, millions of knowledge workers in white-collar industries such as tech and finance rode out the pandemic by staying (and staying, and staying) at home. They relieved their cabin fever with a heavy dose of online real-estate shopping.

In the last year, a lot of middle- and high-income households took advantage of the pandemic to accelerate their plans to buy first homes, second homes, and vacation homes. The typical 2020 homebuyer made nearly $100,000, a significantly higher income than the average homebuyer had in past years. “The pandemic and the feeling of not having enough space combined with low mortgage rates gave a lot of higher-income families a reason to pull forward home purchases that they were thinking about making in the next few years,” Tucker said. Plus, many of these families were competing to purchase the same sorts of houses: Something bigger with extra rooms to convert into work-from-home offices, a large outdoor space, and, whenever possible, a pool.

As the COVID-inspired flight to larger houses boosted home prices, the pandemic took a sledgehammer to urban amenities, and downtown rents fell. Restaurants, bars, and museums have closed, and remote work has made living close to the office less valuable. The typical new entrants into cities, who would usually absorb any excess supply, have all been punished by the pandemic in their own way. Immigration has declined, and some immigrants working in COVID-affected industries have had to move or double up with family. Many young college graduates have waited out the pandemic at a parent’s house. And transient residents with the option to decamp temporarily to the suburbs have done so. It’s all there in the U-Haul data: Arrivals to New York fell 35 percent last year, according to the company, and no state saw more net emigration than California.

All of this has crushed demand for rented apartments in cities. But something else has accentuated this historic divergence between downtown rents and suburban housing prices: the quirky habits of the Millennial generation.

“There are an unusual number of people around age 30 in America right now, and they have been unusually likely to live in central cities,” Tucker said. Indeed, the number of 30- to 39-year-olds in America is about to reach its highest point in history; and those are prime home-buying years. One analysis of New York City by the real-estate website StreetEasy found that rents, while increasing somewhat in the low-income parts of the city hit hardest by the pandemic, plummeted in richer neighborhoods. That fits one of the big stories of the pandemic: High-income Millennials using 2020 to trade their downtown apartment rentals for urban and suburban homes.

In some ways, the massive rent-own divergence in 2020 highlighted one of the fundamental tragedies of the pandemic, which has so sharply exposed America’s preexisting social inequalities. The plague disproportionately infected and impoverished minority and low-income hourly workers. But for some rich households, it created the perfect opportunity to spring for that Florida vacation house, or that suburban lot with the south-facing pool.

This strange moment for American housing isn’t all bad, though—and, in a few years, some very good things could come from it. A historic imbalance between rents and home prices could set the stage for an urban renaissance led by younger and more middle-class residents. The big drop in Manhattan rental prices is already luring back younger residents. For those who love cities—and I do—downtown living is a steal right now, and New York City in particular hasn’t been this good a deal in decades.

According to Chris Salviati, an economist with the online rental market Apartment List, rents are rising again in almost all of the hardest-hit rental markets, including San Francisco, Boston, and Washington, D.C. As rents increase, so will buyer’s remorse. We are already seeing the emergence of a new genre of feature profile in major newspapers: the city slicker who moved to the suburbsand hates it there.

One needn’t frame every story as a tale of generational warfare, but the generational angle to this story might be the most enduring one. The last decade has punished Millennials with a Great Recession, a slow recovery, and a housing shortage. But the next decade could see Generation Z moving into cities that offer great bargains for young residents, even as they benefit from a booming economy, full employment, and a surge in housing construction.

For more, visit The Atlantic.

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Luxury Real Estate Report Reveals Shifting Buying Trends

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The Institute for Luxury Home Marketing recently released an in-depth report of emerging luxury markets and buyers: “The Report: 2021 Global Luxury Market Insights.”

“The luxury real estate market showed its resilience through a dynamic year as the market accelerated many ongoing trends that were already occurring. The report highlights the achievements of 2020 and uses the rich insights from 78 luxury property specialists across 65 markets—a record for us,” said Craig Hogan, vice president of Luxury at Coldwell Banker Real Estate LLC. “With these timely perspectives, our luxury property specialists can prepare for what’s to come in 2021 and continue to act as trusted advisors as many shifting buyer trends and preferences are here to stay.”

Several new trends surfaced in 2020 amid the pandemic, according to the report.

Buyers sought out properties with access to the outdoors, privacy and additional space. Demand for mega mansions, estates and other luxury compounds increased.

Of the property specialists surveyed for the report, 55% said more square footage was the No. 1 amenity that “flipped demand in 2019 to 2020.”

Additionally, a new demographic known as Trailblazers are driving the shifting buying trends, migrating away from urban centers and seeking out smaller, hidden-gem towns in the suburbs and second-home destinations.

Over the next five years, survey respondents for The Institute predicts these trends are here to stay: the home office (27.5%), demand for a second home (22.5%) and the desire for a single-family detached home (22.5%).

“2020 was a transformative for the luxury real estate market. We saw record-low interest rates paired with demand at an all-time high for single-family homes, resulting in extremely low inventory levels and multiple bidding wars across several luxury markets,” said Jade Mills, president of Jade Mills Estates and international ambassador of Coldwell Banker Global Luxury®. “The emergence of a new affluent demographic and type of homebuyer fueled this growth driven by shifting lifestyle preferences. Many of the trends we saw at the forefront in 2020 will continue to evolve in the years to come.”

Four hotspots among the report’s Top 10 “Power Markets” of 2020 include:

East Bay, California
This area scored highly due to soaring home sales in both the single-family and attached sectors. The sales ratio rose over 100% in July.

Colorado Springs, Colorado
Growth here was fueled by millennials and out-of-state buyers. The sales ratio (38.84%) remained consistent with luxury single-family homes in demand.

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Fairfax County, Virginia
There was only one month of inventory for $645,000-plus townhomes in December, and even less for homes in the $1M-plus category. The sales ratio was 51.93% for attached homes.

King County, Washington
Pent-up demand led to a 37.7% sales ratio at asking price.

Additionally, the report highlighted four key categories of emerging markets across the luxury home sector:

Secondary Markets on the Rise
– Phoenix, Ariz.
– Denver, Colo.
– Dallas, Texas

Markets Exceeding Expectations
– Salt Lake City, Utah
– Sacramento, Calif.
– St. Louis, Mo.

New Discoveries
– Burlington, Vt.
– Reno, Nev.
– Coeur D’Alene, Ida.

Ready for Discovery
– San Antonio, Texas
– Knoxville, Tenn.
– Hamilton County, Ind.


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