Will our children ever take their stuff?

StorageDid your children move out and leave some of their stuff behind? Are you over 35 but still, have stuff stored in your parent’s basement?

Some adult children are slow to launch and some fail to launch but either way they seem to store a lot of stuff in their parent’s basement, garage or attic. I see it all the time when I meet with people who want to sell their houses.

Dear person in their twenties, thirties or forties,

It is wonderful that you got that new job and were able to move out of your folks place a mere________ years after you graduated from college. I know it is a big scary world out there and it is hard to move away. Just think of it as a new beginning.

Your parents love you, we always have and we would do almost anything for you and we probably have and we are very proud of you.

There is one thing that you need to know. We are not being honest with you about something. We have kept a secret from you all these years, and it has nothing to do with Auntie  Sue or that one incident a few years back at the water park. We know you did not do that on purpose.

We want to tell you that we are very tired of the boxes and storage bins in the basement and the bike, sports equipment and roller blades in the garage. We understand that you also regret having purchased that tacky piece of furniture that you bought the first time you moved out but left stored in the basement this last time you moved out. We hate it too, and yes you may move back in that is true, even though we had the locks changed and you know the secret about the back door, you will find a way, but I suspect you won’t want to use the furniture as you seem to hate it so.

Even though we love you and would do almost anything for you we don’t want to provide storage for your stuff anymore.  We would like to use our basements and garages and attics for something else now. We have our own tacky furniture that needs to be stored and most of our closets are overflowing as we have not moved in years and have not had any place to put anything in decades.

It would be heavenly to be able to walk to the washer without tripping over something and honestly the furnace and water heater have always wanted a room of their own, they watch and wait silently as the stuff piles up around them.   Last time we had a repairman here he couldn’t even find the furnace, I guess he wasn’t much of a repairman.  I never saw him leave the house, he may still be down in the basement looking for the furnace, I guess we don’t know for sure but hope not because they charge by the hour.

Please come over for dinner tonight.  We promise to cook something you really like and buy a couple of bottles of wine, or maybe you would enjoy a beer instead.   Bring a friend or significant other and a moving van. We will even front you the cash so that you can rent it. After dinner kindly remove your stuff. Don’t make me have to write this twice.  I may be old but I am still your mother and even though you are bigger than I am I can still kick your butt, or at the very least make you feel guilty.

Thanks, your loving mother.

PS if you read this after the garage sale please accept my apologies, I know I should have sent a text message but for some things, 140 characters are not enough.

Oh, and while I am at it I would not mind being a grandmother someday.

. . . If your adult children want to live with you or are moving back in, please contact me about downsizing.

letters from real estate agents

What is up with those letters homeowners get from real estate agents? The letter is from an agent who has buyers looking for a home in your neighborhood or the agent has buyers looking for a home just like yours.

These letters are not exactly truthful but they are very effective. They are a way to get a listing appointment and the opportunity to list your home. There is about a zero percent chance that the agent will have a buyer who is an exact match for your home.

It is likely that the agent does have a client who may want to buy a home in your neighborhood. In the current seller’s market, most of us have buyers that we are struggling to find a home for. That doesn’t mean they can afford your home or that they will like it.

Some homeowners get letters from a few different agents who are soliciting business in the same neighborhood. They end up believing that their neighborhood or property is particularly hot. The letter also boosts seller confidence and the result is an inflated view of what their real estate is worth.

Homeowners who get a lot of letters may fit the profile of someone who is going to move soon. We use predictive analytics these days.

Real estate companies and associations have templates real estate agents can use for this kind of marketing.

Template for a letter to homeowner

Once the agent who has the buyers looking in your neighborhood lists your home it will be another agent who brings in a buyer. That isn’t all bad. If your listing agent does bring the buyer then he or she is acting as a dual agent.

When a home is listed on our MLS agents compete with each other to bring in a buyer. Half of that commission the seller is paying will be paid to a buyers agent if her buyer buys the house.

If you have been getting letters from agents who have buyers you can ask them if they will agree to a one-time showing contract. Under that contract, they can bring in their buyer(s) and if the buyer makes an acceptable offer you may just end up selling your house with almost no hassle and a minimal commission.

The good news is even though agents don’t really know someone personally who will buy your house they keep the idea and mystique alive and in this market, someone will have a buyer for your home.

Will your retirement be mortgage free?

Milkweed

My father used to say that to successfully retire a person needs a few incomes and that owning a house free and clear counts as one income. For many paying off a mortgage is a pre-retirement goal.

I suppose it could if the other costs associated with the home are affordable.  If they are not a home can be sold and the proceeds can be used to buy a more affordable home.

“More Americans are expected to still owe on their mortgage by the time they reach retirement. The share of Americans 65 and older with mortgage debt increased from 22 percent in 2001 to 30 percent in 2011, according to data from the Consumer Financial Protection Bureau” according to an article in   Realty Times

According to the same article, loan balances have doubled and more people will be making mortgage payments after retirement or will be retiring later because of mortgage payments. A lot of it has to do with all of the refinancing and borrowing and of course with the great recession and the crash of the housing market.

One study found that older American’s did more refinancing than any other group which to be honest kind of makes sense because older Americans own more real estate.

Nearly a third of all American’s own their homes free and clear. [LA Times]  There are two schools of thought on paying off a mortgage. One school says don’t do it and the other says pay it off. Personally I don’t see any advantage to owing money and paying interest on top of it but apparently, some people see it as an advantage.

Many people will hit retirement age and still have a mortgage. The good news is monthly payments may be a bargain compared with rent and are sure to be much lower than assisted living or a nursing home.

Fuses or breakers?

The answer is breakers. There are houses in St. Paul that still have old electrical boxes with fuses instead of breakers. Fuses seem to work fine but those boxes are at least 50 years old and some are much older. Having an ancient electrical system means having fewer circuits. Insurance companies do not like fuses and will charge more or they won’t provide insurance at all.

If the power is 100 amp and the fuse box does not have to be relocated prices for upgrading to breakers start at about $1500.00. It can cost twice as much if there is 60 AMP service or if the electrical box needs to be relocated.  It is easy enough to get an estimate from an electrician.

If you are buying a house with fuses plan on upgrading to breakers. Make sure to check the electrical box before making an offer on a house. Sometimes there is more than one box especially if there is central air or an upgraded kitchen.

I strongly encourage sellers to upgrade to breakers before they put the house on the market.

We use our houses much differently today than we did in the 1950’s. We use a lot more electricity. I have seen old fuse boxes with four or five circuits for the whole house. Newer electrical systems will include that many circuits just for the kitchen.

fuses and breakers
Electrical panels

 

de-cluttering, but what is clutter?

There really isn’t any universal definition of clutter. I define it as “stuff” that distracts potential home buyers. I have a simple philosophy when it comes to staging and that is less is more.

The stuff keeps potential buyers from seeing the beauty of the home. Here are a few items that become clutter once the home is for sale:

  1. Family photos.

    Antique Teapot
  2. Wall calendars.
  3. Refrigerator magnets.
  4. Too many house plants, real or fake.
  5. Too many books
  6. Doilies
  7. Throw-rugs
  8.  Extra dining room chairs
  9. Large ottomans
  10. Large coffee tables
  11. Extra end tables
  12. Large collections of almost anything
  13. decorative pillows and blankets

The important thing to remember is that it is alright to use our homes anyway we see fit but when it comes to selling a home it is all about marketing. Women, in particular, react negatively to “clutter”. Less really is more and when in doubt, leave it out. The general idea is to make the space look larger and a bit more generic.

My list is only partial and has the most common items that I ask homeowners to remove from rooms. Homes that are not decluttered sell too. The list is aimed at the homeowners that want to go that extra mile and put some effort into getting the most money for their home in the least amount of time.

The longer people have lived in a home the harder it is for them to de-clutter. As a service to my clients, I go through their homes before they put them on the market and make suggestions.

Using a reverse mortgage to purchase a home

Maybe you have heard of reverse mortgages. They are not a scam but there are reverse mortgage scams.The youngest borrower in the household must be at least 62 and the homeowners must have a lot of equity.

The reverse mortgage is exactly as it sounds. Instead of making a house payment every month the mortgage company sends the homeowners a check. There are no mortgage payments. The mortgage is due when the home is sold or when the owners die.

The reverse mortgage is a way to unlock the equity that might be tied up in real estate.

Reverse mortgages can also be used to purchase a home. They do require a down payment and the youngest borrower must be at least 62. The borrows must have a lot of equity or own the home outright and have good credit ratings. On loans for purchases, buyers must have the resources to pay property taxes, homeowners insurance, and association dues if applicable.

Reverse mortgages can also be used for home improvements. Sometimes people want to stay in their home and age in place but the home needs some upgrades to make it more senior friendly.

Talk to your bank or lender if you are interested in any of these programs and learn more. There is also counseling for people who choose a reverse mortgage. For more general information visit the HUD.gov web site and read about reverse mortgages.