Okaza Real Estate

Reasons Why You Should Build a New Home

A house is more than just a dwelling. It is an investment, a way to save for the future and to watch your capital grow. It makes sense to buy and own a house rather than pay rent. If you consider the amount of rent you pay over a lifetime you will find that if you own a house and pay a mortgage, you save a lot of money and also become the owner of property you can pass on to future generations or sell at a tidy profit. Should you buy a used house or should you build a new home is the question. There are pros and cons to each. However, a new home is definitely worth considering over buying an existing one.

You can choose the location

It may not be possible to find an old house in the location of your choice. You can buy a plot of land in a location you like and think of building a new home entirely to your specifications.

Design of the new home

When you buy an existing house, you have to take it as it is and renovate or remodel. You could, of course, demolish the house and use the site to build an entirely new home from the ground up. In either case you have full control over the design, placement of rooms, siting of the house in the plot, size and all parameters.

Quality of construction

An old house will have a number of defects. There could be cracks in the walls, leaks in the roof, peeling paint and similar issues. When you build a new home you are in total control. You can decide whether your new house should be made of masonry-concrete or lumber or prefab or even steel, aluminum, glass. Your builder will also factor in “green” building technologies that will help save energy and keep the house cool in summer and warm in winter. The savings alone make it worth the effort. In addition, when you go for new construction and have a reputed builder by your side you have full confidence that quality materials and processes will go into the construction to make the building last.

Cost control

Fix your budget and talk with the builder. He can come up with a clever design that will give you a house within your existing budget with provision to expand later on. You could decide on a lumber home, which might give you a larger space at a lower cost. If time is a constraint your builder could help you select the right prefab house. You could decide on a concrete-brick structure, starting with a ground floor for the present and then build the first floor later on. You can even decide on what goes inside such as the tiles, wall cladding, insulation, fixtures, light fittings and every tiny detail.

Peace of mind for years

A new house will give you peace of mind for years. You will not have problems of water ingress from the floor or walls, dripping ceilings or drainage problems. A well built house should require minimum maintenance for at least five years, if not more.

Value addition

When the design is right and the exteriors blend in with the landscape to create an overall beautiful aesthetic, your house increases in value. Should you decide to sell a couple of years later, you can always expect a profit.

Pride of ownership

Last but not least, if you have invested time, energy, thought and money in the building of a new house, it is the realization of a dream and it gives you pride of ownership.

Investing In Residential Real Estate For Positive Cash Flow

To any savvy investor, real estate was the tried and true model for consistent return on investment. At least that was prior to the 2008 crash and the chaos that followed. Now terms like subprime mortgages, NINJA loans, and predatory lending have left a nasty taste in the mouths of many Americans shaking their trust and leaving wide open a golden opportunity for people willing to go against the grain. It is true that buying real estate these days takes some real effort. Financing residential real estate takes more than the traditional route of going to your local bank and taking out a traditional loan. Especially if the investor hopes to turn newly acquired real estate into positive cash flow, after all while the housing market has certainly improved there is no shortage of “for sale” signs in the suburbs.

During the early 2000’s the trend in residential real estate was monolithic homes that took up two or three lots gobbled up by developers. The many “McMansions” still stick out in otherwise inconspicuous neighbors, remnants of the unique hubris of owning a large home even if it meant you couldn’t afford to live there. Of course developers made money this way; they also lost their shirts this way in 2007 and 2008 when they could no long sell these homes and the loans defaulted. So like all other times in history were demand falls, supply tappers off, but that demand was simply for huge houses not for housing. Every American still needs a home, and now is willing to settle for lease since they have already lived through the recession. Really average young Americans have to rent, after all banks are simply not willing to give out mortgages to millennials who, unlike their parents, are more and more often being confronted with staggering student debt and a shakier job market.

So then what is left? The answer is simple; invest small, and invest in rental properties. If you want a real positive return on your investment the soundest course to take it to acquire foreclosing and short sale properties from neighborhood banks. Sometimes these properties have a tendency of being beaten up and will require some work to improve them enough to rent, but when compared to building new the initial investment is minuscule. This tactic can allow you to find a property for much less than it’s estimated value and so can turn the CAP rate to your advantage. However, to truly turn a property around and have it cash flow positively requires a very important consideration, more important than even how inexpensive the property was; your market. If you want your newly acquired (formally foreclosed) piece of residential real estate to start producing revenue right away than it becomes important to understand the demographic you are trying to attract.

If you want to take advantage of the new real estate trend, and at the same time maximize your profits, then you should aim small. Americans no longer want the 4,000 square foot brick homes with 5 bedrooms and 3 full baths; they want to live where the utilities are small and the taxes aren’t huge. This trend isn’t just for home owners/ renters; it is all the rage in apartments too. The advent of the “micro unit” (really just a 280 square foot studio) is taking over San Francisco, and New York where young professional would rather be out in the city than staying inside. The mind set of many suburban markets is minimalist too, just the basics, and that couldn’t be better if you are investing in single family homes. After all there are still plenty of big homes on the market, but smaller and older homes are sold much sooner.

So if the hope is to maximize your investment on residential real estate then the strategy is simple: look for foreclosing/ foreclosed properties, invest in distressed properties that can be fixed up quickly, and aim small. A 1940’s two bedroom home can offer more to an investor, even if it doesn’t feel like such a huge return, but the goal is consistency. It better to make consistent positive cash flow than to take a big risk and buy big, and wind up sitting on a property that could have already been rented out if it were smaller. In today’s market the old adage of “go big or go home” could literally not be more wrong.

Tips on Investment Properties for Beginners

Tips on Investment Properties for BeginnersWhen you have extra cash and want to invest it the best option is real estate because they have high returns. Although property prices in the short term may go up and down, they appreciate substantially in the long run. Investment properties are something that you can bank on as it will acquire value with the development of the areas in the vicinity of the property. There are risks that cannot be completely eliminated but if you do a thorough research and planning you can lessen the risks. If you are a beginner investor, investing in real estate can seem daunting at first. Here are some tips to help you make the right investment choice.

• Know the range of options for real estate investment-you can invest in buying commercial properties, residential houses, apartments, condos, or land so you need to study which would be a better investment for you. There are many options so you will need to do your research to see which one will align with your future plans and stay within your budget.

• Why investing-are you investing to buy to sell again for a profit or do you want to rent the investment property? If your investment properties are residential you can create a regular income by invent in rental properties. You can also be a “house flipper,” which is where you buy an older home, renovate them, and sell them for a profit. If you decide to invest in commercial property you can hold it until the prices go up and then sell it to make a good profit.

• Location-when buying an investment property remember it is all about the location. The price of the property is largely a function of where it is located. Where the property is helps to decide the price range. Make sure that you research the price trends according to different locations before you buy investment properties.

• Network with a real estate agent-they can make your job a lot easier finding the type of property you want to buy. When you network with real estate agents they can help point you toward investment properties that fit your plans. A real estate broker will handle the legal work that is involved with the sale and purchase of the property for you. They can also make an offer and negotiate for you.

• Make financial arrangements-once you chosen the investment property you will need to arrange a mortgage to pay what your savings do not cover.

Have a Luxury Home When Working With Custom Builders

Whether one is dreaming of a waterfront estate, mansion, or just a big house in a dream place, not everyone will invest in what they truly want, or be able to for that matter. However, there are some ways to get closer to what is dreamt of, like adding a few amenities that won’t break the bank but increase their custom homes’ values.

Many buyers today are simply working on their existing homes and turning them into custom homes. These are people who don’t really want more square footage, but want their home to be transformed into a dream or luxury home. They save a fortune doing so, and easily up the value.

The Latest and Greatest

Anyone considering this investment wants to know what the latest is when it comes to luxurious amenities.

Wet Rooms

One trend is that of having a Jacuzzi having moved to a “wet room.” What exactly is a wet room? It’s basically the same experience only faster. Instead of having to wait for a hot tub to fill or get warm enough, they can turn on jets and the water surrounds them in an instant. There may still be a tub or somewhere to sit but it’s much different and more sensible.

As far as tubs and showers, stone and hand-crafted options are on the rise. Infinity pools are popular outdoors and a lovely waterscape.

Finishes

High-end finishes include many different textures. Wall, floor and ceiling finishes are ever so important for a luxurious atmosphere. Using raw materials to include stone, wood and glass are popular trends in custom homes. This goes along the trend of bringing the outdoors in, and indoors out. Everything sort of melds together to create a refreshing, natural feel. While these surfaces are finished, they don’t necessarily feel as such, as they did in the past.

It’s in the Details

Attention to detail is common with luxury, custom homes. Plumbing fixtures, cabinet alignment, patterns and more is all taken into consideration when crafting interiors and exteriors. Great rooms are not just a combination of rooms anymore, but feature a consistent theme even within the finishes and materials. Colors fall within a single palette, and even lighting stays similar to create a feel of flow.

New and Hot

Deluxe and professional spa rooms, full outdoor kitchens with wood-fire for cooking, custom wine cellars that include entertainment space and energy-efficient additions like solar panels, smart home systems and geothermal heating are all trending.

Further, keep in mind these aforementioned examples of some of the best luxury amenities offered on the custom homes market today. If a home for sale has these options and is affordable, buyers are in luck. In most cases, custom homes are renovation projects to be a great deal.

These are just some of the amazing home amenities buyers crave in custom homes, put them on the list when designing. They are:

1. Fire and Water Feature – indoors and out

2. Wet room – not the kind for bringing in muddy dogs and children, a personal spa.

3. Stone surfaces – walls, countertops, cabinets and more with stone that is consistent in pattern.

4. Technology or media room – still a huge selling point, somewhere to escape and relax.

5. Open kitchen for entertaining – have the entire party in the kitchen!

6. Wood finishes – nature calls for more wood, stone and similar finishes throughout.

7. Entertainment wine cellars – throw a party in the wine cellar, have tastings, this is so convenient and impressive.

8. A great room – new great rooms aren’t just big, but carry consistent elements.

With this knowledge, anyone will be ready to build custom homes to their fantasy specifications – happy planning and building!

How To Find A Custom Home Builder Without Losing Your Mind

Building a custom home is the largest purchase most people will make in their lifetime, and choosing the best custom home builder is essential to the project’s success. The role of a custom home builder is as much to advocate for the homeowner as it is to collaborate with the design team. Since homebuilding is a process that takes several months, it’s important that you the buyer feel there is trust and clear communication on the part of the builder. If you have a location and have set your budget for the project, you are ready to shop builders; read the following tips on how to find a custom home builder without losing your mind.

Consider your resources

If you have already hired a designer, they are the best asset at your disposal for beginning your search. Your design professional likely has first hand experience working with builders and will know their construction qualities, communication styles, and business reputations. You could also check with your lender or realtor, if they are familiar with the custom home market in your locale. You can contact the National Association of Home Builders for a list of qualified local builders. Internet searches can identify builders in your area, and some sites may be equipped with ratings & feedback from prior customers. And, certainly, you could ask friends and acquaintances who have completed custom home projects for referrals.

Shop the candidates

Shopping for a well-qualified home builder is easy when you know what to look for to accommodate your project. The right builder for you will need to have the available time, an interest in your project, and experience in working with homeowners. You want a custom home builder whose primarily focused on building custom homes rather than speculative homes, so that their services are tailored to your needs. When considering builders, ask about their current projects and their track record with projects of similar scale and detail to yours. They should also be able to provide you client references. You want to get the sense that the builder you are considering has done this sort of thing before.

Work the schedule

When you talk to prospective builders, ask what kind of schedule you would be looking at for your project. Know that building a custom home usually takes a minimum of 6 months and that the schedule will be weather-dependent. Additionally, steps must be taken before the home can even be framed, such as installing the plumbing and electric up to city code. A builder promising a time frame for completion that is only a few weeks or months should be considered a red flag, no matter how tempting it may seem. In the case of custom home building, it’s better the project be completed properly then quickly.

Communication is key

Again, you need to be comfortable with how a builder communicates with you. You should not feel pressured or talked down to at any junction. You are trusting an expert to build your home, and that expert ought to be able to take the time to explain their process in layman’s terms. You should have access to the construction site. You should feel your questions are welcome, and that they being answered in a timely and respectful manner. If you get the sense that the builder is more or less communicative than you would like, take note, and consider moving on. You do not want to enter into a building contract with a builder whose communication is irksome.

How Real Asset Managers Approach Land Investments

Real assets of all kinds, including land, have performed well, years after the financial crisis. But managers of these assets need to know their category.

Real asset managers are different from financial brokers in many regards. Chief among them are how they understand the assets themselves, beyond performance metrics. Rare antiques and art require people who are versed in art history, for example. For people who trade in gold, an understanding of the market and global geopolitics is a requirement. A real asset manager who works in land investments is perhaps the best example of this distinction.

For investors, this might be reassuring because of the heightened degree of interest in land and property. Particularly now – more than a half-decade since the global financial crisis – land investments retain an attraction to investors for several reasons:

• Land assets outperformed securities – In the first 13 years of the 21st century, the world equity index (performance adjusted for inflation) generated an annualised return of only 0.1 per cent. Bonds did better, with an annualised return of 6.1 per cent, benefiting from a low-interest rate environment that could change soon. Real assets including land can and often do perform much higher.

• Land assets are hedges against inflation – Real assets, including land, tend to rise in value with inflation. Fund managers value such things as farmland and forestry holdings because their products rise with inflation and increased yields (food and wood) over time as well. Considering strategic land investments, which prepares and converts raw land adding into housing-ready developments, the demand for housing and price increases that outpace inflation drive home this point.

• Land assets are non-correlative to financial markets – Land itself lost little value in the financial crisis while the financial markets were in a tailspin.

But to be clear, working in land investments comes with requirements:

• Illiquid, for better or worse – Almost all real assets cannot be disposed of easily. Investment in a joint venture land opportunity, for example, will come with contractual time parameters. It may be that the investor can exit after 18 months or after several years. Real estate investment trusts (REITs) are the exception, traded as market securities (and as such are subject to price volatility).

• Requires specialised skills – the predispositions of local planning authorities, home site design and infrastructure. It’s far from a market security buy-sell scenario – and just as importantly, it rewards strategic and creative thinking.

Land Purchase Considerations

Land Purchase ConsiderationsIf you are looking to purchase land, there are several important items to consider.

What is the cost of the land? If I pay $1,000,000 for 10 acres to build a shopping center does that cost fit within my budget? Or is $500,000 the most I can pay and still have a profitable project?

Does the location work for the intended use? For example if someone is trying to build a convenience store is the site in a high traffic area? Or if someone wants to build expensive homes is the location suitable for million dollar homes or is it too close to commercial uses?

  • What jurisdiction is the land located in? The City Limits? Is it in the Extra Territorial Jurisdiction (ETJ) of the City? Is it in the County? The jurisdiction that the property is located in will dictate which rules and regulations need to be followed. It might be advantageous to be in a particular jurisdiction (City A vs City B) rather than another. There may also be state and federal laws that will impact the property as well.
  • If the property is in the City, what is the zoning category assigned to the property? The zoning category dictates the land use allowed on the property. If a property doesn’t have zoning or if a zoning change is to be requested then that will add to the time and cost. Something to keep in mind is that zoning change requests are not always approved.
  • Deed restrictions are private agreements and restrictions specific to the land in question. They are noted in the deed, and restrict the use of the real estate in some way. Deed restrictions can be attached to property whether it is zoned commercial or residential and are in addition to local, state and federal rules. Deed restrictions can be more restrictive than other governing rules.
  • Have utilities been extended to the site? Utilities would include water, wastewater, electricity, natural gas, telephone, and cable television. Water is the most important. Water and wastewater are typically the most expensive utilities to extend to a property. There are other ways to get water service such as drilling a well or for wastewater constructing a septic system. However these solutions also involve ongoing maintenance and a limited lifespan.
  • Is any portion of the property in a floodplain? If so then the build-able or develop-able area of the property will be reduced. This in turn typically will reduce the value of the property.
  • What are the topographic conditions of the land? Is it flat or is there slope to the land? The more steep the slope the more it will cost to develop the land because of the necessary cutting and filling of the soil. In general flat land is preferred although a hillside location for a home or office can provide a very nice view.
  • Is there roadway access to the property? If so is there an existing driveway and curb cut in place or will this have to be permitted and constructed? How likely is it that a permit can be obtained at this location or is there already a driveway nearby which might diminish the chances? Is the roadway in a state of disrepair? If so then what are the chances that the roadway will be repaired and how might this affect my planned use?
  • An easement is a legal right to use another’s land for a specific purpose. Are there any easements on the property that might restrict or otherwise unduly affect my ability to improve the property? Examples of easements include public utility easements which allow utility providers to install and maintain utilities. Easements can also be the means of providing access to properties that do not otherwise have roadway frontage.
  • A lien is an encumbrance on one person’s property to secure a debt the property owner owes to another person. Before purchasing property it is important to determine through the Title Search and Commitment process if there is an outstanding lien on the property. It is best to have the property owner take care of liens before the buyer closes on the property because it is easier to leverage a lien being released.

Mortgage Strategies For Different Life Stages

Becoming a homeowner represents a major life milestone. But from a financial point of view, purchasing a home is not a one-time event; it is the foundation for a variety of strategies over the course of a lifetime.

Before settling on any mortgage strategy, it is important to think through what you want financing to accomplish. As with any major financial decision, your particular circumstances and goals should shape your choices. Are you most concerned with saving money overall? Minimizing your interest expense? Securing the lowest possible monthly payment? Some buyers may want to maximize their equity – the market value of the property less the remaining mortgage – while others may have the goal of becoming debt-free by a certain age or milestone. How you weight each of these objectives will shape how you approach a mortgage. Beyond your goals, think about your circumstances. Your stage in life, your family situation and the other assets available to you may all affect your decision.

Once you have answered these questions, you can consider a variety of mortgage strategies appropriate for your goals. While there is certainly no particular age limit, upper or lower, for any of the strategies I will discuss, some make more sense at certain life stages than others.

For first-time homebuyers, often in their late 20s to mid-30s, the main goal of a mortgage will generally be to secure the particular home they have in mind. Before deciding on a mortgage type, these buyers should seriously consider how much of a down payment they can afford and the size of the mortgage they plan to take.

A few years ago, securing a mortgage often required a down payment of 20 percent or more. These days, lenders have relaxed that standard. Even when it is not required, a substantial down payment certainly offers advantages, such as the potential for a lower monthly payment. But the current low-interest-rate environment and reasonable housing prices in many markets may make buyers hesitant to wait.

In this situation, there are some options. The Federal Housing Administration offers insured loans to buyers who can only afford very small down payments, potentially as little as 3.5 percent. Borrowers must also meet other FHA criteria to qualify, and should expect more paperwork and a higher interest rate than those of a traditional mortgage.

Borrowers who cannot make substantial down payments might also consider “piggyback” mortgages to avoid private mortgage insurance, often abbreviated PMI. All borrowers will want to avoid PMI if possible, since it will increase the monthly payment amount, though this is offset slightly by the fact that premiums can be deducted as interest if you itemize deductions on your federal tax return. If a homeowner’s down payment is under 20 percent, a lender typically requires PMI. Piggyback loans allow borrowers to take out second mortgages to cover some portion of the down payment. These arrangements avoid PMI, but typically involve higher interest rates than single mortgages do.

Lenders may offer a buyer the option of paying points on the mortgage at closing. The buyer pays set fees outright in exchange for a lower interest rate. While this may seem appealing because of a lower monthly payment, most homebuyers should avoid paying points. If you pay interest upfront, it becomes a sunk cost that you cannot recover if you sell your home before the end of the mortgage term.

Once a borrower decides on a down payment, the next decision is what type of financing to secure. Adjustable-rate mortgages offer relatively low interest rates for a fixed term, often five or 10 years, after which the rate becomes variable. These mortgages are especially attractive to buyers who know they plan to sell their homes before the variable rate takes effect.

While many borrowers can and do refinance when the fixed term is up, the rates are likely to be higher, possibly much higher, five to 10 years from now. In White Plains, New York, 30-year fixed mortgage rates for buyers with good credit hovered between 3.5 and 4 percent as of this writing; by historical standards, these rates are incredibly low. Buyers will not want to be hit with the inevitably higher rates down the line. However, if a buyer firmly plans to sell the property during the fixed term, the lower rates can be attractive. Buyers should always avoid adjustable-rate mortgages with very short terms.

For many people, if not most, a traditional 30-year fixed-rate mortgage remains the best choice. If you are buying your “forever home,” where you plan to raise children or build your life for the long term, a 30-year fixed rate will almost always be the right way to go, since it locks in a reasonable rate virtually for life.

Even if you do not intend to stay in your home very long, life happens and many people’s plans change. Time moves quickly and only seems to go faster as we age. Not only might inertia keep you in place past your initial plan, but a financial setback could also mean an original moving timeline is no longer practical. Even if you grow into a larger home, you may wish to keep your starter property, especially if it is a condo or apartment. You could then rent it out, even once you have made your home elsewhere.

The major downside of a 30-year fixed-rate mortgage is that you will pay the most interest over the life of the loan because of the long term and the rates that outpace the fixed portion of an adjustable-rate mortgage. For those interested in obtaining home equity more rapidly, a 15-year fixed-rate mortgage may be an attractive alternative. The downside is that a shorter term means significantly higher monthly mortgage payments. In addition, your overall financial picture will include less liquidity, since more of your assets will be tied up in home equity.

There are a few mortgage types that all borrowers should avoid outright. An interest-only mortgage is one in which the borrower pays only interest for a set period, often five or 10 years, while the principal remains unchanged. While some borrowers find them appealing because the early payments are substantially lower than later ones, these loans almost always involve taking on too much risk; the homeowner builds no equity at the beginning of the loan, so a decline in the property’s value can quickly become a disaster.

Borrowers should also avoid loans structured so that the borrower owes a large lump sum at the end of the mortgage, often called a “balloon payment.” Unlike a typical mortgage, the full value of the loan is not amortized over its term, which makes monthly payments lower. However, many homeowners concerned about securing a lower monthly payment will lack the cash to make a balloon payment, meaning that they will either need to sell their home – trusting that property values have not dropped so far that the sale will not cover the payment – or refinance at rates that are almost sure to be higher five to 10 years from now.

Different strategies become available to borrowers who have held their mortgages for some time. For instance, by the time homeowners reach their late 30s or 40s, it is likely that their earning power has increased. Many may find themselves in a position where they could pay their mortgages down faster than the standard amortized schedule because they have paid down other debts or reduced expenses. But just because borrowers can pay their mortgages faster does not necessarily make it a good idea.

First, borrowers should double-check to make sure their mortgages have no prepayment penalties. While you should never accept a mortgage that has such fees in the first place, if you failed to look for this provision, you certainly should not incur any penalties to pay faster.

Even if no penalties stand in the way, the current low-rate environment means that many people would be better off investing their extra cash in diversified portfolios. If the expected rate of return is higher than the mortgage interest, allowing for the benefit of deducting that interest, an investor essentially creates leverage.

That said, a very conservative investor who is especially averse to debt may find paying off his or her mortgage is the right choice. If the borrower is considering sticking the money in a low-yield money market or savings account, the mortgage’s interest rate will still beat the rate of return on such vehicles, even allowing for its tax treatment.

For some homeowners, making extra mortgage payments offers the added bonus of imposing forced budgetary discipline. Some borrowers know that they will spend any cash that is available to them; by paying down the principal, these people will build their home equity by tying up their money in an illiquid form.

Homeowners in this life stage may also start to consider a second mortgage. While once relatively rare, home equity loans – another name for second mortgages – became nearly standard in the 1990s and early 2000s. In part, this is because mortgage interest is generally deductible on income taxes (up to certain limits), regardless of the loan’s purpose. While such loans can occasionally be useful, the housing crash demonstrated the real hazards of excessive borrowing using one’s home as collateral, including losing the home itself and marring one’s credit history through default. This strategy should be pursued very cautiously, if at all.

A home equity loan is different from a home equity line of credit, or HELOC, though both carry many of the same risks. Rather than taking out a loan for a fixed amount, a HELOC is set up as a line of credit using the home as collateral. The borrower can draw on the credit line much like a credit card, with the loaned amount subject to variable interest rates.

By the time you consider a second mortgage or a HELOC, you may be nearing the end of your original mortgage. Smart homeowners have refinanced their mortgages within the past seven years to take advantage of the current low rates; those who have not should do so as soon as possible before rates start to rise again.

Homeowners who have been in their houses for a few decades are likely to be in their prime earning years, with an eye toward retirement. Some of them may be financing their children’s college educations or considering big-ticket purchases, and may want to use their home equity. Beyond the options discussed above, borrowers may have the option to refinance a principal amount that is higher than their current principal balance. The lender will present the difference as cash. Some lenders, however, may be reluctant to allow such a strategy in today’s strict lending environment.

Furthermore, this technique can be dangerous. Effectively using a home as an ATM means that the homeowner will be paying a mortgage for longer than originally intended, face higher monthly payments or both. It can be tempting to view a home as a source of ready cash, but if the home’s value suddenly falls, the owner could end up in an uncomfortable situation. In fact, widespread use of this strategy was a major component of the 2008 financial crisis.

Retiree homeowners may have a problem opposite that of younger adults buying first homes. They may well own their homes outright, but could find their finances constrained by too-small retirement nest eggs or unexpected expenses. They may wish to consider reverse mortgages in order to turn some of their equity into cash. In a reverse mortgage, the lender does not require repayment until the borrower dies or sells the home. In theory, the loan is structured in a way that the loan amount will not exceed the home’s value over the loan’s term.

Factors To Consider When Buying Land

Land is very important in real estate. When buying land to construct a house you need to consider a number of factors. Some of these factors include:

Zoning Requirements

Here you need to check with the local authorities and determine the zoning ordinances. You should also find out if you are allowed to construct the type of house that you have in mind. The future is very important; therefore, you should ask whether there are plans to improve the infrastructure in the area. For example, you should enquire whether there are plans of constructing airports and shopping centers.

Natural Hazards

You should contact the authority in the area and obtain a natural hazard disclosure. The disclosure will tell if the land is ideal for building. As rule of thumb you should stay away from a land that is prone to natural hazards.

When determining the natural hazards in the area you should also find the elevation of the land. If the land is located near a hill you should determine the chances of the land moving. Remember that the slab of your house can easily crack if the land is unstable.

If the land is good, but near water bodies you should consider constructing your building using a raised foundation. You should also ensure that you get flood insurance.

Utilities

For you to live a comfortable life you need to have utilities in your home. One of the most important utilities you should have is water. Remember that you can’t dig wells in some areas. To be on the safe side you should determine the depth of your water table and find out how difficult it is to dig a well.

Electricity is also very important. If the area doesn’t have power you should determine how expensive it will be to bring it to your home.

You should also consider the sanitation in the area. If you can’t hook up to a sewer you should do your calculations and find out how costly it will be to install a septic system.

Conclusion

These are some of the factors that you should consider when buying land to construct a house. When making the purchase you shouldn’t be turned off by the restrictive covenants that might be on the area. Remember that these restrictions are meant at ensuring that the houses constructed in the area conform to given standards. Always go through the restrictions and understand what is allowed and what isn’t.

Benefits of Custom Homes

When it comes to investing your hard earned cash into a home, you have two options. You can buy an existing property, maybe do some renovations to make it your own, or you can build your own custom home based on your unique needs and requirements.

For many people the building process is a long and daunting one, often one they don’t want to go through, but with the right builder by your side, a custom home provides you with a range of benefits you wouldn’t ordinarily get when it comes to buying an existing property and changing it accordingly. In fact buying an existing property and making changes will cost you more in the long run than building your own.

The first benefit to a custom home is that you get to enjoy a unique design that has been drawn specifically for you based on what you like and your particular family needs. You aren’t restricted by an exiting design or by a chosen design based on area, you can create your own space, working alongside an architect who will incorporate what you feel is important to create your dream home for you to enjoy for years to come.

When it comes to a custom home you get your preferences rolled into one with your house being designed from top to bottom to suit your needs and requirements from materials to number of bedrooms and spaces to additional extras and more. The architect will sit down with you, learn about you and what you like along with what you feel is important. They will then create a design for your approval which will incorporate all that you have spoken about to provide you with a finished design that ticks all the boxes.

If you are looking to enjoy a greener lifestyle, focusing on using environmentally friendly elements to create your dream home, then this can be added. This is your chance to build a custom home focusing on energy efficiency, lowering your carbon footprint and building a home you believe is going to meet your needs well into the future, a home you want to live in now and moving forward.

With a custom build you can identify what you feel is important for you and your family and have those important elements added to your design. You may collect vintage cars and need a large garage to accommodate them or you may work from home and you need a big office space to run your empire. You may even want to run your beauty business or art studio from home and need a spacious and light space where you can conduct your business with ease and confidence.

Another benefit of a custom home that you may not have realized is how reduced maintenance costs are. Remember everything is brand new, your building work, garden and even your appliances. This means those are under warranty, so in the event that something goes wrong and they need require, the cost is not for yours. This helps you save money in the long run.

A custom home is a brand new home that has been built for you. You are part of the process from your wish list of what you want included to watching the property be built from the ground up using the materials and accessories you have chosen along the way.

The day you officially move your furniture in and make it your own, you can look back on the custom home process and for many, they want to do it all over again, adding things they may not have thought of the first time around.

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