Install an Updated Energy Star System

If your home is more than 10 years old, you may benefit from having a new Energy Star HVAC system installed by professionals. A professional HVAC contractor can evaluate your existing system for efficiency. If you do install a new system, don’t skimp on professionals – correct, professional installation can affect the energy efficiency of your new system up to 30%.

Seal Heating and Cooling Ducts

Ducts that move air from your heating or cooling system to your rooms can be a big drain on your efficiency. Consider sealing and insulating your air ducts. Properly sealing and insulating your ducts can result in a boost of 20% energy efficiency – or more, in some cases.

Install a Programmable Thermostat

A programmable thermostat enables you to keep your house at a comfortable temperature when you’re home, but lets you adjust the temperature when you’re at work or away – saving you cash on unnecessary heating or cooling. When used properly, a programmable thermostat can save around $180 per year in energy costs.

Maintain Your System Properly

Even a good, energy-efficient heating and cooling system requires regular maintenance. Change your air filter regularly – every one to three months, depending on the season. Consider an annual tune up for your HVAC system – you can save a ton by ensuring that it’s operating properly, and get a jump on any maintenance areas or potential problems in the system.

What Kind of Appliances can be Energy Efficient?

When most people think of energy efficient appliances, they think of things like heating and cooling systems, air conditioners, washers and driers and refrigerators. While these are all candidates for energy efficiency, there are a lot of things people don’t think about – like computers, monitors, scanners, televisions, surround sound systems, ceiling fans, light fixtures and even things like handheld vacuum cleaners.

When you’re buying an appliance, think about how you use it. Something like a television may be used for hours every day, and having an energy efficient television would translate directly to cost savings. While something like a computer may not seem like an obvious candidate for an energy efficient rating, anything that you use frequently, for long periods of time or on a regular basis, or anything that consumes a large amount of energy, is a candidate for energy efficiency.

Look for the Energy Star Label

Any time you’re buying a small or large household appliance, look for the Energy Star symbol. Energy Star appliances are subjected to a series of requirements that basically translate to the appliance offering energy efficient operation. Some Energy Star labels give you an estimate of how much money you’ll save when you operate this appliance versus a non-Energy Star competitor. But even just seeing the label lets you know that the appliance is energy efficient and you’ll be saving money and reducing greenhouse gas emissions.

Always Conduct a Thorough Home Inspection

A thorough home inspection is your key to differentiating a viable “fixer upper” from a home that’ll cost more than it’s worth. Always get a thorough home inspection, conducted by a professional. Make sure they look at the “problem areas” in addition to the normal inspection process. A home inspector may be able to give you a ballpark figure on repairing the outstanding issues, and can give you a list of issues which may be more comprehensive than the seller provides, but don’t stop at a home inspection – have a contractor come in next to bid on the work.

Get Bids on Outstanding Work

After you get your home inspection, consult with at least a few contractors to get bids on the outstanding work. You want bids from more than one contractor just to determine whether the bids are in the appropriate ballpark. Anyone who’s done work on a home knows that the actual cost of repairs and remodeling typically exceeds the bid. A good rule of thumb is to assume that you’ll go over the bid by approximately 20 percent.

If you can afford the bid plus 20 percent, and that wouldn’t put you over the value of the home, it might be a viable fixer upper. But if you can’t afford the bid, or if the repairs would cost more than the home might be worth, you should either negotiate the price down or pass and keep looking.

Traditional Buyers are Competing with Investors

Investors have long been treated as a marginal element in the residential real estate market. But this study proves conclusively that investors are important players in the market, controlling nearly 30% of single family home properties. If you’re a traditional buyer, this means that you’re not only competing with other buyers for available homes – you’re competing with investors, too. And investors are looking for the best deals, and successful investors are some of the most savvy real estate buyers. So if you’re in the market for a home, you face some stiff competition in the form of investors.

Investors Provide Options for Non-Traditional Buyers

For buyers who are unable to obtain financing through traditional means, the high number of investor-owned residential properties can be good news. Each of these properties may represent an opportunity to buy a home where you might not have had the option through traditional means. The study shows that many of these investors are renting out these homes, so not all of them are available for purchase, but this still means more homes than expected for buyers who have trouble obtaining standard financing.

Whether you’re a traditional buyer who is competing with investors for homes, or a buyer who has had trouble obtaining traditional financing – one thing is clear: now is the time to buy. With the high number of investor-controlled properties, you may need longer lead times to get the home you want. And if you’re competing with an investor to find your dream home, you can’t afford to wait until the market is even more competitive.

The Value of an Energy Audit

An energy audit can be an extremely valuable tool for new homeowners. Highly efficient homes can save you hundreds of dollars a month in utility bills, or thousands of dollars in utilities over the course of a year. It may be worthwhile to pay more for the more efficient home up front, knowing you’ll be saving after you buy.

An energy audit can also reveal a need for correction to improve efficiency. If you’re about to buy an energy guzzler, you can find out before you buy, and use that to negotiate a lower asking price, require the seller to fix the problems, or find yourself a more energy-efficient home.

How to Get an Energy Audit

The best-known energy audit is called HERS, the Home Energy Rating System. HERS audits are performed by an organization called Resnet, which conducts the training and certifies inspectors. Resnet has partnered with a couple of the largest home inspection networks, so in some areas, you may be able to add on an energy audit to your home inspection for a few hundred dollars.

In other areas, you may need to ask your real estate agent how to get a HERS audit, as many agents don’t speak up about the option. But paying a few hundred dollars for this audit up front can save you thousands of dollars per year in utility costs, or it can give you leverage to negotiate a lower asking price, so it’s worth the cost.

Don’t Use Existing Amenities to Judge Property Lines

When looking at homes, you can’t use existing amenities to judge property lines. It’s easy to see a fenced yard and imagine that’s where your property line is located. But a fence may not actually be on the property line – the property could actually extend beyond the fence, or in some cases, the fence may even be on a neighbor’s property. There are a ton of reasons that this could occur, and in many scenarios, the sellers may not even be aware of an issue. You as a buyer must do the appropriate checking before assuming that all is well.

Check Legal Documentation, and You May Need a Survey

Check the legal documentation on file with the city or with the county property registrar. The documentation on file for the property should list a legal description, which tells you exactly where the property line is located.

In cases where a legal description follows geography of the property, such as along a creek, cliff or ridge, it may be easy to judge a property line visually. But in a place like a sub-division or other flat, grassy neighborhood setting, you may need a formal survey to confirm that the property line is actually where you think it is. Check with your real estate agent or your attorney to discuss whether you need to order a survey in your particular circumstances, but don’t assume just by looking at a property that you know where the property line is located.

Type of Mortgage

The type of mortgage plays a role in the mortgage rate. Lenders want to be compensated for lending, so a riskier or more unusual type of mortgage comes hand-in-hand with a higher rate. Many lenders have multiple “products” – that is, types of mortgage or mortgage program – so you’ll need to talk with a lender about your specific situation and needs to determine what type of mortgage you qualify for, and what your rate will ultimately be.

Term of Mortgage

The term of your mortgage also plays a role in your rate. Typically, longer-term mortgages come with higher rates; you may be able to get a lower rate with a shorter mortgage. Currently, 15-year mortgage rates are at an all-time low. 30-year mortgage rates are about three-quarters of a percent higher. When mortgage rates are higher, you may see more than a percentage point of spread from a long-term to a low-term mortgage. If you can afford the higher payments on a shorter term, like a 15-year mortgage, you can save money on interest because you’ll have a lower rate.

Borrower’s Credit

Of course, the borrower’s credit is one of the most important factors in mortgage rate. Depending on your credit score, you may not be able to qualify for the lowest-rate product a lender has; you may only qualify for a high-risk product that comes along with a higher interest rate. Generally speaking, the better your credit score, the lower your mortgage interest rate – and vice versa.

Find Out Your Realtor’s Areas of Expertise

This applies both to locale and to types of real estate and home sales that your realtor handles. You want to find a realtor who really knows the region you’re considering, and can make useful recommendations on location. But you also want a realtor familiar with the home type you’re considering, or the type of sale you want to pursue, such as short sale, foreclosure or standard sale.

How Experienced is Your Realtor?

Find out how long your realtor has been an agent. More experienced realtors can be extremely valuable, but may not have as much time to devote to you. Newer realtors may not have all the answers, but may be able to spend more one-on-one time working with you on your home sale. Decide which is most important to you.

What’s Your Strategy for My Needs?

Ask a realtor about their strategy to meet your needs. You want to know things like how a realtor intends to search for your home, how  many homes you’re likely to visit before selecting one, and what assistance the agent provides when making an offer. Make sure the agent has the right strategy for your needs.

What’s Your List-Price to Sale-Price Ratio?

You want the best deal, so you want to find a realtor who has a track record of negotiating a sale price that is lower than the list price. The better this ratio, the better the deal you’re likely to get.

How it Works

Homeowners are eligible to deduct the interest that they pay on first and second mortgages up to $1,000,000 in mortgage debt. People who are married and filing separately can deduct up to $500,000. You can also deduct home equity loans up to $100,000, or up to the amount of equity that you currently have in your home. The math can get complicated, but it’s calculated using an annual effective interest rate. These deductions can reduce your tax liability, which means you’ll owe less in taxes – and you’ll get a bigger refund at the end of the year!

Maintain a Mortgage to Take Advantage of This Deduction

In order to qualify for this tax deduction, you must maintain a mortgage on your home. Some people work to pay down mortgages early in order to eliminate a monthly payment. However, most financial advisers will recommend that you actually maintain a mortgage because the reduction in tax liability typically surpasses the amount you pay in interest. In other words, the tax advantages of maintaining a mortgage are valuable enough that you shouldn’t try too hard to pay it down early, but should instead use extra cash to make other investments that can help your long-term financial goals. The second you pay off your mortgage, you lose your tax deduction!

The Consequences of Increased Rental Demand

An increase in demand for rental units has a couple of negative consequences for renters. Most noteworthy is price. When the demand for rental properties outstrips the supply, the price of renting skyrockets. People in some parts of the country may see their rent rising hundreds of dollars the next time they renewer their leases. The other negative side effect of high demand for rentals is difficulty finding a good rental. When the demand for rentals is high, renters are often forced to settle for whatever they can find and sign a lease quickly – or risk not finding a place at all.

Stop Renting and Buy Your Home

This confluence of negative effects for renters, combined with the all-time low mortgage rates, means that now is the perfect time to buy. With rents increasing around the country, you could save hundreds of dollars a month by buying instead of renting. Likewise, the housing market in much of the country still has plenty of inventory; which means you have a lot more choices in properties if you decide to buy instead of rent.

Stop paying money into the bottomless hole that is rent, and buy your dream home! What are you waiting for? Things are only getting tougher for renters.