How does owning real estate impact my finances?
Home ownership is an integral part of the American dream but recently it seems the media is filled with stories that resemble a financial nightmare. Before you abandon your goal of purchasing South Carolina real estate take time to evaluate the advantages.
1. South Carolina new homes are safe, modern and allow you to save money on utilities, commute time and other lifestyle options. Many people are surprised to realize how much they spend on fuel for utilities, long commutes and other inconvenient living arrangements. Often the total monthly cost of purchasing a newer home located closer to your place of employment is more affordable than you might think. Add up the cost of repairs, maintenance, fuel, energy and insurance then compare.
2. Long Term Savings. Most mortgages have a 15 to 30 year duration that allows you to lock-in a monthly payment and eventually pay the home in full. Rather than cashing out the equity in your home allow it to accumulate. Imagine how much different your life would be without any mortgage payment! Not only would it save you hundreds or even thousands of dollars each month – for the rest of your life – but the total equity would continue to grow as the home appreciates in value over the years.
3. Additional Income. When evaluating homes for sale in South Carolina keep an eye out for prospective income sources. For example, if you enjoy a hobby then turn the garage or out building into a shop for additional income. Put in a garden or provide daycare services or simply set up a home office. The possibilities are endless and as an added benefit - you might be eligible for additional tax deductions!
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What security features should I use in my home?
Most people shop for a house based upon price and location. But one important and easily overlooked area that can make an immediate impact is security. Security features not only make the home safe but can reduce the cost of homeowners insurance from the very start. When evaluating South Carolina homes for sale use this helpful security checklist.
1. Fire Alarms & Extinguishers. Most homes are required by law to have hard-wired fire alarms but that is the bare minimum. Add back-up fire alarms to the garage and other areas of the home that could be at risk as well as fire extinguishers near the kitchen and garage.
2. Safety ladders. If you are considering the purchase of a two-story property for sale in South Carolina then don't assume the safety ladders are in place since they are optional. Be sure each room has a safety ladder in the event of fire.
3. Windows. Make sure all windows in the home open, close and lock properly. Windows are expensive to repair and replace but since most homes have curtains or other window dressing in place, it is easy to forget to overlook windows. For security purposes each and every window should close and lock tightly. For fire purposes, windows should be easy to open.
4. Locks & Keys. Make sure each and every door opens, closes and locks properly including the garage door and any access doors to the attic, basement or other unusual areas. Once you move in it is a good idea to have a lock-smith re-key the main entrance doors into the home including the front, back, side access and garage doors as well as any sheds or out-buildings. You never know who has copies of the old keys!
5. Alerts. Radon, Carbon Monoxide and other alerts are inexpensive and designed to keep your family safe.
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Should You Buy Flood Insurance?
Unless you are contemplating the purchase of waterfront property in South Carolina you probably haven't given a lot of thought about flood insurance but as thousands of Katrina victims can testify, that might be a big mistake. Here are reasons you should consider purchasing flood insurance for your South Carolina new home even if you don't think you are at high risk.
1. Don't assume your home is safe. Before putting an offer on a South Carolina property obtain an elevation map to determine if the home sits in a flood zone. Even seemingly dry properties can be located in what are designated "100 year flood zones" meaning the property is usually dry but has a 1 percent chance of flooding each year.
2. Don't assume you don't need flood insurance if the bank doesn't require it. If the recent financial irregularities don't convince you that the banks aren't always right then keep in mind, you will still be responsible for paying the mortgage even if you cannot remain in the home. Don't believe it can happen? Just ask the thousands of displaced Katrina victims!
3. Insurance Exclusions. Almost all insurance policies specifically exclude flood related damage because there is such a high likelihood of a claim. In fact, research indicates your home has a 26% chance of being damaged by flood waters during a 30 year period of time (the average duration of a mortgage) compared with only a 9% chance of being damaged by fire!
4. Understanding Flooding. Most people think of flooding from an over-flowing river but flooding can actually occur for many other reasons including excessive rains associated with heavy storms, snowmelt, breaking dams like those in Katrina or other storm related surge.
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How do I insure my items while moving?
Whether you are relocating across the street or across the state, moving is probably the least desirable part of buying property for sale in South Carolina. Most people hate packing, hauling boxes and then unpacking even when everything goes smoothly. Unfortunately, that isn't always the case and things can go from bad to worse. Learn how to protect yourself from relocation related mishaps by using these quick tips and information.
1. Call your insurance agent. Most homeowners’ policies do not cover the contents of your home while in transit!
2. Limited Liability. Don't depend upon the moving company for insurance protection. Read the fine print and you will often discover your valuable possessions are valued by weight and paid (on average) $0.60 per pound in the event of a claim.
3. Moving Coverage. Obtain a quote for moving related insurance coverage or gap coverage for the time period your possessions will be in transit or storage. Make sure to verify it is replacement coverage rather than actual cash value coverage.
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What types of repairs can save me money when buying a home?
Knowing how to pick your problems can be the first step in saving thousands of dollars when purchasing property for sale in South Carolina.
When it comes to real estate there are two main types of problems you will encounter on a property: those that are relatively easy to repair and those that aren't. Like many things in life, looks can be deceiving so it really pays to know how to evaluate a property and repairs before visiting South Carolina real estate listings. Use these helpful tips to find valuable faults and avoid money pits.
1. Visit do-it-yourself and home repair centers. Just spend time walking the aisles to get a feel for prices. It will come in handy when visiting properties to know what different supplies, repairs and other items cost.
2. Search for valuable faults. Valuable faults are things that make the property appear less desirable than it really is. Common examples include poor landscaping, paint, dirt, old fixtures and appliances, worn or ugly carpeting and other cosmetic problems. Especially if the home or property is located in a fast growing area or popular vicinity like Charleston, the appearance of the property might frighten away other prospective buyers. Taking time to improve it will result in a higher market value.
3. Avoid money pits. An equally important consideration is to avoid potential money pits at all cost. Although in theory everything can be repaired, time and money considerations make it less desirable to do so. Common examples include a poor floor plan, small rooms, faulty construction or detrimental location. Before purchasing a South Caroline property that needs extensive structural repairs it is a good idea to obtain at least three qualified bids for the work required as well as insurance quotes to make sure you will be covered during the rehabilitation stage.
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Can I remodel a home in South Carolina?
Millions of Americans have enjoyed watching reality television featuring home remodeling and with local do-it-yourself stores offering free classes on everything from painting to plumbing more people than ever are interested in rehabbing a home. Whether you are buying for investment or interested in South Carolina condos for retirement, rehabilitating a home is a great way to "buy right" when purchasing South Carolina real estate but there are a few things to keep in mind. Here to help is a Remodeling Reality Checklist to make sure you have the basics covered and don't take on more than you can handle.
1. Insurance. Don't assume you can obtain insurance for the property. Many insurance policies require a home to be lived in or eligible for a certificate of occupancy. Depending upon the extent of the project, the house may be ineligible for coverage or require specialized coverage during the rehabbing stage. It is also important to remember liability coverage since there will be tools, exposed areas and unusual circumstances surrounding the property.
2. Tools and Supplies. Spend time shopping in a hardware or do-it-yourself center to become familiar with the cost of building materials, supplies and tools. If you don't own tools you will need to include the cost of purchasing or leasing equipment in addition to the actual supplies.
3. Delivery and Disposal Fees. Don't forget delivery rates and disposal fees because they can add up to big ticket items on a large rehab project. Most areas of the country require special disposal of lumber and other construction related waste. Large projects will typically require the rental of commercial waste disposal bins which can easily add hundreds or even thousands of dollars to the project.
4. Obtain Quotes. Even if you have every intention of performing the work yourself it is important to obtain at least two or three qualified quotes. It provides working estimate of how much it would cost to complete the project in the event you became ill or injured and it also provides a great baseline to make sure your numbers are realistic.
5. Permits and Building Codes. Depending upon where your new South Carolina home is located be sure to obtain all necessary permits and understand the local building codes. If building codes have changed then you will typically need to bring the project up to the new conforming standards before passing inspection.
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How to compare properties?
You have probably heard the old saying that you make money when you buy real estate, not when you sell it. Of course, it sounds counter-intuitive but it simply means that learning how to buy right is one of the most important decisions you will make when it comes to your financial future.
South Carolina real estate can be an excellent investment if you understand how to analyze and evaluate potential properties for sale. Use these steps to compare options when shopping South Carolina real estate listings.
1. Compare the good and bad features of each home item by item.
2. Calculate the cost of replacing each property today by determining the amount of depreciation.
3. Add the value of the land.
Now, let's see how this would work in a real life setting. For the purpose of this example we will assume you have narrowed your choices down to two South Carolina homes of potential interest. Each is listed at $200,000 and each needs approximately $20,000 in repairs. Both are of a similar size.
House "A" is 20 years old and house "B" is 7 years old. House "A" is located in an established neighborhood while house "B" is located on the outskirts of town in a rapidly growing area.
Since the depreciation schedule of a home is 27 years by IRS guidelines, house "A" has only 7 years of useful life while house "B" has 20 years remaining.
Likewise, by adding in the value of the land, we see that house "A" is in a stable area that is unlikely to see future appreciation whereas house "B" is in a growing area.
Clearly, the best choice would be to purchase house "B" even though superficially they look similar.
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