or most homeowners, the equity grab certainly looks
pride of ownership includes possible if the home can be fixed
a consistent home up. Off to Home Depot we go...
improvement effort. While this
makes sense, be careful you don't Let's do an evaluation of our
improve the property so much that ugly ducking. Put another way,
you can't recover the costs when what needs to be done to get it
it is sold. on par with the other ducks in
the neighborhood? Okay, we need
Home Improvement new doors, new windows and
landscaping in a very big way.
You've picked up a heck of a deal The drive way looks like a toxic
on a home in a nice neighborhood. dump sat on it and we aren't even
The purchase price was $200,000 going to get into the peeling,
and you put twenty five percent ugly paint on the home. Pricing
down [$50,000]. The comparable everything, deciding to use
homes, "comps", in the homeowner labor as much as
neighborhood appraised for possible and so on, we find it is
$300,000. Yes, your home is a bit going to run roughly $50,000 to
run down, but that's why they makeover our ugly duckling. It's
have Home Depot and weekends! going to be a lot of work, but
You'll just fix the ugly ducking that's what weekends are for. We
up and pocket a quick $100,000 in should still come out with a
equity when all your projects are $50,000 gain and $100,000 in
done. What a country! total equity considering our
$50,000 down payment.
This situation definitely has
potential. The value of the home Budgets and Temptation
is so low when compared to the
comps that a relatively quick The problem with the above
scenario is it is very hard to You are no longer trying to bring
stick to a budget. If you've your home up to the standard of
owned a home, you're already the neighborhood homes. You are
familiar with this problem. If trying to turn the home into a
you are buying a home for the swan and swans are expensive.
first time, watch out! After making all your
improvements, you are distressed
With homeownership, the structure to find the total cost being
you own quickly evolves into "my $90,000 instead of $50,000. For
home." Once this occurs, you tend all your hard work and effort,
to view the quality of your home you've realized only a $10,000
as a statement to the world and gain in equity.
you want to show the world your
best. Instead of buying In Closing
moderately priced cabinets for
the kitchen, you buy custom Make sure you objectively budget
pieces that would make Bill Gates improvements and stick to those
envious. Counter tops soon become budgets. While there is something
marble counter tops. Refinishing to be said for making a home
the driveway evolves into putting glow, make sure it makes
in an entirely new one with brick financial sense.
inlays. And so it goes.
About the Author:
Dan Lewis is a mortgage broker with http://www.gwhomeloans.com - San Diego mortgage brokers providing home loans and refinances. Visit http://gwhomeloans.com/services.html to learn more about options for San Diego mortgages.
Source: www.isnare.com
