by Phoebe Chongchua
Most sellers know of some repairs that need to be made to their home, and a lot of sellers have many items on that list, but not all repairs are equal or, rather, not all home improvements rank high in the buyer’s mind.
Finding out which repairs will help you sell your home helps you create a good, solid fix-it list to work on. A study produced by HomeGain aimed to take the guess-work out of where to spend your repair dollars. According to the study, the top four areas to focus on are: clean and de-clutter (see last week’s article: Clutter-Free Helps Sell Homes), lighten and brighten, stage the home for sale, and landscape the front/back yards.
The Return on Investment (ROI) depends on the repair and, in some cases, which part of the country you live in. “In some areas of the country things cost more and some people don’t care about some things as much as others do in other areas,” says Jessica Gopalakrishnan, Sr. Marketing Manager for HomeGain.
Here’s how HomeGain breaks down the ROI for the top four repairs. Cleaning and decluttering can create a 578 percent ROI (the highest return was 837 percent in the West). The ROI for staging a home was 340 percent (this category ranked second in the South and Mid-West). Landscaping the front and back yards, brought in a 415 percent ROI. According to the survey, each of these repairs range in cost from a few to several hundred dollars but can return thousands in profit.
Rounding out the study’s top-ten list of repairs are: Repair electrical or plumbing problems, replace or shampoo carpeting, paint interior walls, paint exterior walls, repair damaged flooring, update kitchen and bathrooms. Gopalakrishnan says routine maintenance can help too.
“Not washing the windows is something so simple but a big mistake that homesellers make,” says Gopalakrishnan. Another top mistake is covering up or neglecting care of the floors. “If they leave a dirty carpet on the floor that would be a mistake,” says Gopalakrishnan. She adds that a key strategy for staging a home is to, “lift up the carpets and show off those nice floors — give them a quick shine and clean them up first.”
When you make the above repairs costing approximately $5,000 - $8,000, HomeGain, says that prices, for example, on a three bedroom, two bathroom home can result in price increases: in the West, as high as $22,762; in the East, as high as $23,532; in the South, $21,470; in the Mid-West, $20,279.
“With homes sitting on the market longer, homeowners should do everything they can to sell it quickly and at a price they expect," says, Louis Cammarosano, General Manager at HomeGain.
The survey collected information from 2,000 real estate agents across the U.S. To learn more about home improvements visit, homegain.com
The online resource also has a “What If” tool that allows users to hypothetically add a room, bathroom, or even square footage to a home to calculate value estimates on residential properties.

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by Phoebe Chongchua
It may not always make sense to sell your home. If that's the case, renting it could be a good option. But understanding the rental process and using expert help will alleviate extra stress.
Dr. Danielle Babb is the author of The Accidental Landlord. She shared five top tips for homeowners who are considering renting their home.
Emotionally disconnect from your home. As you can imagine, this can be a very difficult thing to do -- especially if you've lived in the house for a long period of time and maybe your kids have grown up in it -- but it's an important step.
“It can cause some emotional distress and you may find yourself too attached for the new tenants liking and their privacy rights. When you make the decision to rent out your home, it needs to feel similar to how it would if you were selling it to someone else,” says Babb.
Screen your tenants. Don't fast forward to thinking about having wonderful tenants in your home so much that you skip over the screening process. Attending to this process alone, can eliminate huge headaches in the future.
Babb cautions landlords about scams aimed at landlords who don't screen. “There are actually "professional tenants" out there that do nothing but find susceptible landlords, usually those renting without a management company, that don't screen tenants. They will give a deposit, and live rent free (not paying rent), knowing you won't know what to do or how to kick them out,” says Babb.
She outlines several steps in her book that help landlords learn more about removing tenants but she says, “The most important thing is not to let the bad ones in to begin with.”
Babb says in her book as well as on the Landlord Protection Agency website there are screening worksheets that help landlords know what types of questions to ask and what red flags to look for.
“For instance, are they not taking care of their car? Maybe they won't take care of your house either and make sure you call those references! Compare what they tell you to what is on their credit report, and make sure you do a credit and background check. Know who you are renting to, and don't be afraid to say no,” says Babb.
Know the law. There are specific laws to protect the tenant. How much the tenant is protected differs greatly from state to state.
“The laws you must abide by are the laws the home is in. You have to tailor your lease or rental agreement to that state's rules. You can easily find these on the Landlord Protection Agency site and then modify the lease agreement accordingly,” says Babb.
To learn more visit the LPA: thelpa.com
She says, “Common changes are how much notice you must give for them to vacate, the maximum deposit you can collect, and notifications for entrance.”
How much rent? “It's easy to say, 'Okay, I have $2000 in expenses, Ill charge $2100,'” says Babb.
But just like when selling your home, it doesn't work that way.
“The market may only bear a rental comp of $1500. You have to make the decision if that $500/month is worth the long-term gain or whatever your initial reason was for holding rather than selling,” says Babb.
Real estate agents can be a great resource for helping to determine what the best rental price should be. They can show you homes in the area that are also for rent and, just as when selling, taking a look, or at least, driving by the homes gives you an idea about the competition.
“You may get more if you leave it furnished; sometimes you can lease furniture and up-charge and make a profit on it, particularly in areas where young families are starting out or college students frequently live. Just be sure you price it right -- all of those extra months on the market eat into that profit or breakeven point. No matter what, be sure you collect a sufficient deposit -- usually one months rent, plus a pet deposit and additional monies for other reasons, like appearing to be a risky tenant,” says Babb.
Who is responsible for what? Important, but tricky question. Depending on which side of the fence you sit, you, of course, may see this differently.
Babb says, “If something breaks, you have an obligation and lawful duty to fix it immediately if it affects quality of life or poses a hazard. But, if the tenant just wants something upgraded, that isn't a requirement. You have to walk the line between having your tenant stay long term because you're easy to work with and paying too much for little things. You can let the tenant make upgrades that they pay for if you wish.”
Babb adds that incentive programs also help a good tenant to stay longer. “For instance, I give my tenants a $25.00 or $50.00 off rent coupon if they pay 5 days early and pay direct deposit. This saves me considerable time.” She says landlords should beware of partial rental payments such as a tenant paying only $100. “If a tenant sends you a partial rental payment, say for $100, and you cash it, it may start the clock ticking all over again on evictions! These are the types of things that professional tenants do.”
Renting doesn't have to be a scary process; it does have to be a well-researched and carefully planned process to ensure the best outcome for all.

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by Kenneth R. Harney
The economy may be flat, but it's boom time for investors who know how to buy houses at fire-sale prices, fix them up and sell or rent them out.
It's also boom time for the companies that can supply those investors with financing when they need it.
"This is an absolutely wonderful market environment to be in," says Frank Sharp, who heads Watershed Renovation Capital, in Alexandria, Virginia.
Sharp's company specializes in funding real estate turnaround investors -- people who know how to acquire distressed properties, mainly houses, and reposition them quickly.
Like another specialized turnaround lender in Houston, Texas -- Coast Realty Capital -- Watershed provides short-term acquisition and rehab financing to investors at so-called "hard money" rates: 12 percent for the first three months, 14 percent for the next three months.
By the end of six months, Sharp told Realty Times in an interview last week, "we expect the investor to be done" with the repairs and upgrades needed to either sell the house at a profit or rent it out and obtain long-term mortgage financing.
Both Watershed and Coast Realty lend up to 70 percent of a property's expected "after repair value," and charge three to five points up front, a portion of which may be refundable when investors pay back the loan within 90 days.
Meanwhile, the biggest corporate player in the residential turnaround real estate field, Dallas-based HomeVestors of America -- best known for its "we buy ugly houses" ads -- is also having a banner year.
Not only are its 230 franchisees doing record volume, but the company has begun accepting "associate franchisees" - investors who can only devote part of their work time to real estate.
Associates pay significantly lower upfront HomeVestor franchise fees -- $12,000 versus $49,500 -- and can operate out of their homes.
Associates and full franchisees invest directly themselves, buying distressed real estate at an average 40 to 50 percent below market value, fixing them up, and either selling or holding them as rentals.
A key feature of the HomeVestor program, according to vice president Jason Killough, is the availability of proprietary, short-term money to acquire, fix up and resell houses.
But HomeVestors doesn't just give that money away: It charges a hefty 14 and three quarters percent for the first six months -- and expects most franchisees and associates to get the job done by that deadline.
Short-term turnarounds are the norm, said Killough, because "our objective is to move that house" -- at a quick profit to everyone involved.

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