Flipping Houses – HomeownersInsurance.org http://www.homeownersinsurance.org Homeowners Insurance Tips and News Fri, 28 Jun 2013 15:01:02 +0000 en-US hourly 1 https://wordpress.org/?v=4.8.1 One Man’s Trash http://www.homeownersinsurance.org/one-man%e2%80%99s-trash/ http://www.homeownersinsurance.org/one-man%e2%80%99s-trash/#respond Mon, 08 Nov 2010 18:02:25 +0000 http://www.homeownersinsurance.org/?p=1262

These days, record numbers are forsaking the notion of buying homes in favor of renting an apartment. Many are even abandoning homes they were buying as the market continues to look grim, leaving many homeowners upside down in their mortgages. But this exodus provides those who wish to own a home (and who don’t mind paying for property taxes and homeowners insurance) with an unprecedented opportunity.

The price of housing is as low as it is ever likely to get. Even if we were to see another hard recession, it is unlikely that the price of housing will go much lower than it is right now. Additionally, interest rates for mortgages are also at an all time low, giving home buyers a once in a lifetime opportunity to buy a home at a rock bottom price, with the added benefit of paying a very low interest rate.

This is especially attractive for those who are in a position to qualify for a shorter term mortgage. Those who are able to take out 15 year fixed mortgages are in a position to have a significant amount of positive equity in their homes without paying out a ton in mortgage interest. Home buyers who opt for a 15 year mortgage will generally find themselves well ahead of the curve by the fifth or sixth year of their mortgages.

Of course, if you decide to buy a home, you need to consider more than just your mortgage payment. There are several other expenses associated with owning a home, each of which should be added into your calculations when you are figuring out your living expenses. These include:

  • Property taxes
  • Homeowners insurance
  • Utility bills
  • Maintenance
  • Home repairs

While none of these things should scare the average person away from buying a home, they are all things which need to be budgeted for. Home buyers should also be aware that, while they can currently deduct the interest on their mortgages from their income taxes, there is some speculation that this deduction could be taken away in the near future.

So, if you’re in a position to take advantage of the low prices and interest rates in the housing market today, do so. If you’ve ever wanted to be a homeowner, this is likely the best chance you’re ever going to get.

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Before You Buy that Fix-It-Up House http://www.homeownersinsurance.org/before-you-buy-that-fix-it-up-house/ http://www.homeownersinsurance.org/before-you-buy-that-fix-it-up-house/#respond Mon, 21 Jun 2010 19:34:05 +0000 http://www.homeownersinsurance.org/?p=553 In recent years, there has been a great deal of buzz around the idea of buying a home that is in, shall we say, less than perfect condition and fixing it up, either to live in or to sell.

Some people have even managed to make a very good living out of “flipping” houses. They buy houses in poor repair cheap, fix them up, and sell them for a fast turnaround and a good profit. There are some things to consider before doing this, however, including homeowner’s insurance, the time and cost of repairs, and whether or not you will be able to live in the house while you are restoring it.

While the slowdown (crisis, anyone?) in the housing market has made this practice a bit less attractive, at least as a business option, many people do still buy homes that need a considerable amount of work. Of course, the idea is that, once the work is done, they will have a dream house that not only was less expensive than buying a home in pristine condition, but also bears the labor of love that goes into making the house in the image that they want.

But there are some things to consider before going out and diving head first into a house that needs some work. A little asking around will dredge up all kinds of horror stories of people who bought fix it up homes, only to find that there was more work to be done than they had thought. A lot more work, more often than not.

Will your family be living in the home while you’re working on it? If so, is the home really going to be livable? Keep in mind that even relatively minor repairs like patching drywall can make things very uncomfortable for those who have to live in the house, and major repairs just shouldn’t be done while people are in the house.

That’s not to say no one should buy a project house. If your family has a high degree of tolerance for such things, that’s great. But, most families don’t. If you can afford to, live elsewhere while you are fixing the house up.

You should also consider the costs of homeowners insurance. Often, some of the safety flaws inherent in homes that are in need of repair can cause your premiums to be much higher. If you do buy a project house, check with your agent to see which repairs would affect your premiums and make sure you let him know as soon as you complete those repairs.

Photo via Bert K

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