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New Home Values Expected To Rise

When you begin your new home search, you think about how much you want to spend and where you want to live.  Determining where you want to live can be a good starting point.  You’ll have to decide if you’re looking for something contemporary in the city, maybe something traditional the suburbs or maybe something coastal near the beach.  Maybe you are looking for something close to work or you want your children to attend a particular school district?  There are so many considerations when deciding where to look for a new home. The location of where you choose to live can impact how much you’ll need to budget for your new home as different areas have drastically different home values.

 

Home values across the state of North Carolina have risen over the past year by as much as 8.2% and are expected to rise by as much as 4.8% over the next year, according to Zillow.  With increasing home values, the sales prices of new homes will rise as well.  So, if you are on the fence as to whether or not to buy a new home, now may be the right time to buy before the prices increase.

Home_Value_Infographic

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9 Tools Every First Time Homebuyer Should Have

You’ve purchased your first home and are getting settled, you get to start decorating and making it your own. Something you’ll quickly find you need are tools. There are a ton of tools out there, but here are the nine tools every first time homebuyer should have.

  1. Cordless Drill – This power tool will become your best friend. With its many uses you’ll find yourself using it for all your home projects. Cordless drills start around $40.
  2. Screwdriver Set – If you’re trying to tighten something or putting together new furniture, you’ll find yourself needing both flathead and a Phillips head screwdrivers in varying sizes. A 6-in-1 reversible screwdriver set start as low as $5.
  3. Combination Wrench Set – As you begin putting things together in your new home, you will find that you need to tighten and/or loosen nuts and bolts, so you’ll find yourself in need of wrenches. A set of combination wrenches can be found for around $14.
  4. Tape Measure – Whether you’re hanging pictures, measuring furniture or working on a project, a tape measure is a necessary tool for your toolbox. Don’t forget the old saying “measure twice, cut once.” A 30-foot tape measure starts at $14.
  5. Hammer – Whether you’re trying to hammer something into place or remove a nail from a wall, no toolbox is complete without a hammer. They range in cost, but start at about $5.
  6. Stud Finder – This is going to be an indispensable tool when you start hanging things on the walls or trying to do any in-wall projects. Stud finders start at about $15 each.
  7. Putty Knife – This tool will come in handy if you need to fill in holes on your walls. Putty knives on average are $4-$5 each.
  8. Level – Nothing is worse than a crocked picture or shelf and that’s when a level comes in handy. A two-foot level starts around $7.
  9. Ladder – While it won’t fit in your toolbox, this is an essential tool for your new home. Whether you’re cleaning out gutters, painting walls or hanging Christmas lights, you’ll find that you need a ladder. Type II fiberglass ladders start at $55.

McKee Homes, North Carolina’s #1 Choice for New Homes

McKee Homes has highly skilled team members dedicated to creating the best home building and buying experience possible in Eastern North Carolina. Areas we are building in include: Fayetteville, Pinehurst, Southern Pines and Aberdeen, Raleigh and Wilmington NC. Some of our new home resources we can provide you include: New Home Financing, Buyer Incentives and more.

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5 Common Mistakes First-Time Homebuyers Make with New Construction

So, you’ve been going back and forth but have decided that now is the right time to buy your first home. You’ve worked on your credit score and you’ve saved up for a down payment and are ready to get started. So before you get too far into the home buying process you should take a few minutes to read these five common first time home buyer mistakes made with in new construction.

  1. Thinking you can’t afford new construction.
    There are many options available in the real estate market, but thinking you have to settle on a used home is not your only option. New homes are available in many price ranges and in areas you want to be. New construction can even save you money compared to used homes. New homes are more energy efficient with lower maintenance costs; where as used homes are typically less energy efficient and may require expensive maintenance much sooner. Replacing roofing, appliances, HVAC system components or water heaters can be very expensive.
  2. Running up debt after the pre-approval.
    The construction process on a new home can take up to six month and sometimes even longer. Some first-time homebuyers can get excited about getting new things for their new home, like furniture or a new car, and doing this can effect your chances of getting your home loan. From the day you sign your contract to the day you close on your home, the general rule of thumb is don’t open any new lines of credit or increase the amounts on any open credit accounts.
  3. Not knowing the plans for the community.
    You may think the charming community with only 12 homes is just what you’re looking for, but if you ask the Builder’s representative this charming neighborhood is actually the beginning of a 300-home community. Or you could have selected a home that backs up to a vacant field, but there are plans to build an apartment complex in the next six months. Be sure to ask the Builder’s representative what the future plans are so you can make sure you are selecting the right neighborhood for you and your family.
  4. Not speaking up or asking questions.
    Sometimes speaking up or asking questions can be difficult, but it is key that you do this. If you have questions at any stage in the process, from contract to closing to warranty, you need to be sure to ASK. There are no silly questions. Since you’ve never built a new home you may not know what that “doohickey” in the attic is or if that “doodad” is covered under warranty, so you need to ask. Your agent and the Builder’s representative are there to answer those questions for you.
  5. Going overboard with upgrades.
    Remember that model home you fell in love with? There is a high chance that that home was heavily upgraded. So when you go to your selections appointment you should go with a budget in mind. You’ll need to weigh the cost of getting everything you want versus having just the options you really want and staying within your budget. Some upgrades can pay off in the long run, like upgraded carpet padding as it can extend the life of your carpet. However, you should also consider the resale value when doing your upgrades. The average first-time homebuyer usually lives in their home for 11 years before selling. You may have always dreamed of lavender countertops in your master bathroom, but when you go to resale your home that might be a turn off for potential buyers. Maybe lavender on your walls could be a nice compromise.

There is no better feeling than the profound pride that comes with owning your first home. And just imagine if your new home is brand new. So avoiding these five common mistakes first-time homeowners make with new construction can lead to making the right home buying decision for you and your family.

McKee Homes, North Carolina’s #1 Choice for New Homes

McKee Homes has highly skilled team members dedicated to creating the best home building and buying experience possible in Eastern North Carolina. Areas we are building in include: Fayetteville, Pinehurst, Southern Pines and Aberdeen, Raleigh and Wilmington NC. Some of our new home resources we can provide you include: New Home Financing, Buyer Incentives and more.

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5 Things To Do To Improve Your Credit Score Before Buying a New Home

The home buying process begins long before your start looking at new home listings online. One of the first steps in the home buying process is getting a handle on your finances and understanding your credit. Here are five things to do to improve your credit score before buying a new home.

5 Things to do to Improve Your Credit Score

  1. Know what’s on your credit report.
    When was the last time you checked your credit report? If it hasn’t been in the last year, then you could be missing something that could be hurting your credit score. Every year, you can get your credit report, for free, from TransUnion, Equifax and Experian by going to annualcreditreport.com. While this doesn’t provide you with your credit score, it does show you what the lenders see.
  1. Identify and fix any errors.
    Once you’ve reviewed your credit report with a fine-toothed comb, you need to start fixing any errors. On each of the credit bureau websites there are step-by-step instructions on how to dispute errors, and your credit report will have instructions as well. When contacting the credit bureaus, keep detailed notes on what you submit to them and copies of any documents.
  1. Always be on time.
    It may seem like commonsense but if you’re looking to increase your credit score pay your bills on time every month and don’t miss a payment. Paying more than the minimum balance, even if it’s just a little more, looks good to the lenders. It also helps you pay your bills off faster.
  1. Pay off your credit cards, but don’t close them.
    Paying off your credit cards is a great way to lower your debt-to-income (DTI) ratio. Every lender has different standards for DTI ratios, but according to Consumer Financial Protection Bureau, a DTI of 43% is, in many cases, the highest ratio a borrower can have and still qualify for a mortgage.
  1. Be smart with new and old lines of credit.
    If you are under contract to buy a new home, opening up new lines of credit or making any large charges on your current credit card can negatively alter your DTI. This makes you look risky to lenders. If you are building a new home, it can sometimes be a six-month or longer process, so be sure to plan ahead. It is recommended to wait until after closing to buy a new car, new furniture or book that all-inclusive vacation. If you have any thing that comes up before closing consult your lender. While not opening new lines of credit is important, keeping old lines of credit open is advised. These old lines of credit show your credit history and closing them could change your DTI for the worse.

Source: Forbes.com; HGTV.com

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Should A Veteran Always Use A VA Loan?

The VA loan program is a great benefit for veterans and with 21 million VA home loans it seems like a no-brainer that veterans would take advantage of this benefit. But should a veteran always use a VA loan? The answer is no, but let me explain.

There are many reasons to use the VA loan program. One of the biggest perks of this program is the no down payment. The VA does not issue the loans but they are guaranteed by the government which gives lenders confidence in issuing the loans.

  • You don’t have to have a down payment as long as your loan doesn’t exceed $417,000.
  • Lower closing costs as the VA restricts the types of closing costs a veteran can pay.
  • No monthly mortgage insurance premiums like you find with other loan programs.
  • VA loans also allow for those with higher debt ratios and lower credit scores to qualify for loans.

Now all this may make you wonder, well why wouldn’t I want to use a VA loan? Well there are a few things that may make you consider not using a VA loan.

  • If you’re buying a fixer-upper home, you won’t be able to use a VA loan as they are mainly for “move-in ready” homes.
  • While you can reuse a VA loan, you can’t get another VA loan before you pay the other one off.
  • If the home you’re buying isn’t going to be your primary residence then you’ll need to consider another loan program.
  • There is a limit on VA loan co-borrowers who are not a spouse or another veteran.
  • If you have a 20% or larger down payment it may be wise to consider not using a VA loan to avoid the VA funding fee.

So when you start your home search it would be a good idea to check into all of your home loan options. Knowing what’s available to you can save you time and money, and even if you are a veteran, you may not always want to use a VA loan.

Source: Marketwatch.com; VeteransUnited.com; Military.com

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Should I Buy a New Home Now or Later?

If you’re like many people, you may be asking yourself should I buy a new home now or later? While there are many things to consider when asking this question, here are a few things to get you started:

  • Are you in a good place financially?
  • Are you ready to be your own landlord?
  • Are you committed to staying in one place?

If you answered yes to these questions then you may be ready to buy a home. The next question you may ask yourself is should I buy now or later? With interest rates still at all time lows, that may sway your opinion. Maybe, knowing that Freddie Mac predicts that by January 2017 interest rates will rise to 4.5% or that CoreLogic predicts that home prices will increase by 5.5% over the next year may help make your decision to begin the home search now. If you wait until next year, that $250,000 budget you have would need to increase by $13,750 to get the same home.

Should I Buy a New Home Now or Later

If you have questions about the home buying process or what McKee Homes has to offer, contact us today and we would be happy to answer your questions.

Additional Source: Forbes.com

 

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McKee Homes Warranty

One of the most common questions new homeowners have is ‘how do I submit warranty requests and schedule the work to be done?’ McKee Homes enrolls all new homeowners in our 2-10 Home Buyers Warranty program upon closing. This program provides 1-year workmanship, 2-year systems and 10-year structural coverage. In an effort to provide exceptional customer service we have partnered with 2-10 Home Buyers Warranty, one of the nation’s leading home warranty companies, to handle all homeowner warranty requests under their Front Line Warranty Service Program.

During your Pre-Closing orientation, your Builder will show you a sample McKee Homes homeowner’s manual and cover some of its key points. Shortly after closing, you will receive an email with login information for your BuilderTrend account. This is where your personalized homeowner’s manual will be located. Your homeowner’s manual provides a wealth of information, including:

  • 2-10 Home Buyer’s Warranty information and warranty manual
  • Emergency service numbers for plumbing, HVAC and electrical
  • Seasonal maintenance guide
  • 30-day and 11-month warranty service request forms

The 2-10 warranty manual explains what is covered under warranty and what is not covered, so it is a great reference tool. The emergency numbers are for the trade partners who helped build your home. If something happens with your electrical, HVAC or plumbing that needs immediate attention, you know whom to contact. The seasonal maintenance guides are informational and provide suggestions on how to help maintain your home and avoid costly repairs later on.

The warranty service request forms can be used to fill out at 30-day and 11-months after closing to address any issues you may find in your home. These forms are optional, as 2-10 Home Buyers Warranty will take your warranty items over the phone, through email, fax and mail. All contact information can be found in your homeowner’s manual. We do recommend keeping a running list so you can be sure to get all of your items addressed at one time. Once our Front Line Warranty Service team receives your warranty items they will determine what is covered and what is not covered. The items that are covered under warranty will be scheduled for repair with you by the Builder in your neighborhood. Our warranty system does not offer reminders at 30-day and 11-months after closing, so putting a reminder on a calendar may help remind you when it’s time to turn in the lists.

If you have a warranty issue with your appliances you will need to contact the appliance supplier directly. Their contact information can be found in your homeowner’s manual.

It is our goal to make sure any issues with your new home are resolved in a timely manner. From minor issues such as nail pops to more complex issues that occasionally occur, our 2-10 Home Buyer’s Warranty Program will protect your investment in your new home. Should you ever need to sell your home, the warranty is fully-transferable, which increases the resale value of the home.

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Maintaining Your Septic System

When you think about the maintenance of the systems in your home your first thoughts are probably HVAC, electrical and plumbing. However, one overlooked and undervalued system in your home is actually outside your home, the septic system. As with all the systems in your home, if you properly maintain your septic system you can avoid costly repairs.

First, understanding how a septic system works will help you maintain it. The wastewater from your home leaves through a pipe and goes to the septic tank. The waste separates into solid waste (sludge) that sinks to the bottom and oil and grease (scum) rises to the top. There are bacteria in the septic tank that helps to breakdown the sludge. The wastewater then exits the septic tank and goes into the drainage field. The wastewater is released into the soil which removes harmful bacteria, viruses and nutrients.

So one thing you have to watch is what you put down your drains (that goes into your septic tank). Everything that goes down your drains should be biodegradable and septic safe. Flushing things like dental floss, feminine products, paper towels, coffee grounds and other kitchen and bathroom products can clog the tank and drain field. Also, household chemicals, paint, oils and grease can kill the good bacteria in your septic tank. If you have a garbage disposal, you will want to use it sparingly as it will increase the accumulation of sludge and scum.

Another thing to be aware of when you have a septic system is how much water you are using. Per the EPA, the average single-home family uses 70 gallons of indoor water per person per day. Leaking faucets and running toilets can waste as much as 200 gallons per day. Faucet aerators and high efficiency toilets and showerheads can help reduce excess water usage. Many people like the convenience of washing all their laundry in one day, but with a septic system you need to give your tank time to recover. So it’s recommended to spread your washing, otherwise you risk flooding your drainage field.

Knowing where your septic tank and drainage field are is also very important. You don’t’ want to put anything heavy like a shed, parked car or RV, cement or pool in this area as it can damage the tank and pipes as well as compromise the drainage field. Another thing that can damage your septic system are large trees and shrubs. Roots, especially aggressive roots that come with Willows, can damage pipes and the tank.

Having your tank pumped regularly is part of proper maintenance. Professionals typically charge between $200-$300 for this service, however, it can vary by region. Keep in mind that if they have to dig to find your septic tank that will incur additional fees. When your tank is pumped they should also inspect the tank to make sure everything is in good working condition. The frequency of pumpings varies between owners. No matter the size of your family, if you have a garbage disposal it is recommended that you pump your system annually. If you are a family of four with no garbage disposal, it’s recommended every 2-3 years. If you are a family of two with no garbage disposal, it’s recommended every 4-5 years.

Every few months using a septic tank system treatment, like Rid-X®, by pouring into your toilet can add the bacteria necessary to keep your septic tank performing optimally. For those of you who like homemade treatments, you can pour a liter of spoiled buttermilk down the toilet every few months, as it too is a great source of bacteria. If you notice anything that seems off with your septic system, it is best to contact a professional immediately to address any issues as early as possible.

While this system doesn’t need constant supervision, remembering these key things will help prolong the life of your septic system.

Sources: http://www.epa.gov/owm/septic/pubs/homeowner_guide_long.pdf; http://www.wikihow.com/Care-for-a-Septic-System

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Laminate Floors vs. Engineered Hardwood Floors

Laminate flooring is fast becoming a popular choice over engineered hardwood floors for homeowners across North America because of its durability and cost effectiveness, both important aspects to consider in today’s economy. Laminate is also more environmentally friendly and easy to install.

The core of laminate flooring is made of highly pressurized wood fibers, agricultural waste and resin. A decorative paper is added to the surface and covered with a durable melamine resin. The special backing creates a moisture barrier, making it the ideal flooring choice for kitchens, bathrooms and basements.

Laminate typically has three rating levels, based on the use of the room it will be installed in. Low-use laminate is perfect for the bedroom or similar rooms that have low traffic. Average-use is made for the rooms that the whole family frequents, but where the flooring wouldn’t receive as much abuse, such as living rooms and dining rooms. High-traffic laminate is designed for just that, heavy traffic. This rating is ideal for rooms where durability is most important, such as kitchens, bathrooms and utility rooms.

Many people look to solid hardwood because of its natural beauty and use of all natural materials. This type of flooring is comprised of solid pieces of wood, but homeowners may want to consider which room they are planning to place it in. Solid hardwood floors do not hold up to water and moisture well. When placed in a high humidity environment, the boards will warp and buckle over time. Homeowners should check to see if the materials were obtained in a sustainable forest in order to maintain an environmentally friendly project.

Although engineered hardwood is made similar to laminate (with a high density core), its top layer consists of a thin piece of natural wood covered by several layers of veneer. Both engineered hardwood and laminate flooring are comparable in durability, but there’s a distinct difference in price-point. Laminate varies in price from $1-$6 per square foot whereas engineered hardwood costs anywhere from $5-$15 per square foot, depending on the finish and type of wood. That’s a considerable difference especially if you’re planning to cover hundreds of square feet.

Thanks to today’s technological advances, laminate flooring has come a long way from the boring designs and feel of the 1980s. Homeowners can now enjoy a floor that looks, feels and sounds like real wood without having to empty their wallet.

Source: http://www.house-energy.com/Floors/Laminate.htm ; http://cleanmyspace.com/hardwood-vs-laminate-vs-engineered-hardwood-floors-whats-the-difference/

As a Buyer, How do I Pay my Real Estate Agent?

When most people begin their home search, they typically enlist the assistance of a real estate agent. With everything an agent does for the buyer, many buyers ask how do I pay my agent? Typically, the seller pays agent’s commission as it comes out of the sales prices of the home.

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A real estate agent does many things for their buyers on new construction homes, including explaining and negotiating the contract, attending the selections appointment and construction orientations, communicating with the Builder on the progress of the home and attending closing. They can also suggest mortgage lenders and home insurance companies. So with everything they do to benefit you, the buyer, it’s important to understand their commission.

The seller makes an agreement with the listing agent on what the commission will be. That amount is added into the sales price of the home. A typical commission can be between 5%-6%. If the seller is offering a total of 6%, the list side will get 3%, and the listing side will offer the buyer’s agent 3% commission to bring a buyer to their listing. If the list agent brings a buyer to their listing directly without a buyer’s agent bringing the buyer, it is called dual agency, the list agent will now get paid a 6% commission as they are representing both the seller and buyer.

For example:

The home you’re purchasing is $200,000 and the commission rate is 6%. ($200,000 house price X 0.06 = $12,000) The agent split can vary, it could be 60% to the agent and 40% to the firm, or it could be 50/50, 60/40, 70/30 or whatever the firm and agent agreed upon. In a 60/40 split, the commission breakdowns would be:

Dual Agent Example

  • Agent: $7,200 (office fees are taken out of this commission)
  • List Firm: $4,800

Buyer Agent and List Agent Example

  • Buyer Agent: $3,600 (plus office fees)
  • Buyer Agent Firm: $2,400
  • List Agent: $3,600 (plus office fees)
  • List Agent Firm: $2,400

Real estate agents make their money from the commission of the sale. So you, the buyer, won’t have any upfront fees while working with your agent.