3 Ways Smart Homes Impact Real Estate

According to one survey, 47% of people between 18 and 34 own smart home products. But just because millennials are the most likely to incorporate smart devices into their homes doesn’t mean that other generations don’t use them. For example, baby boomers love using voice commands to activate AI assistants such as Amazon Alexa or Google Home. Even seniors can benefit from smart homes that enable them to live independently for longer. But the real impact smart homes have may be on real estate.

Smart Homes Sell For More

Smart home devices increase the value of a home, up to 5% more than “dumb” houses in the same neighborhood, which means sellers stand to make a more significant profit if they spend a bit of time making a home smarter. But why is this a trend? Potential buyers are attracted to the convenience, safety, and future savings that smart homes provide, even if it’s a greater investment in the present.

Smart Homes Sell More Quickly

While no one can predict precisely how long it will take a home to sell, some factors can shorten sale time. Aside from location, condition, and price, features play an essential role in how long a house is on the market. Smart devices certainly count as alluring features that will help a home sell faster.

Smart Homes Attract Tomorrow’s Buyers

Even if homeowners have no plans to sell in the near future, they’ll do well to remember that more millennials will be entering the housing market in the future. And almost half of that demographic already uses smart home devices. Homes that do not include those devices won’t be as attractive to those futures buyers.

Smart home technology may still be developing, but there are already several options for homeowners and sellers to consider. Consider the following.

  • Smart thermostats can be controlled from a variety of mobile devices and can be programmed to turn on the heat only when people will be home, promising comfort and cost savings.
  • Smart home security options include cameras, locks, sensors, and carbon monoxide detectors, all of which can alert homeowners when necessary.
  • Smart lighting is ambient and convenient and can even save homeowners money.

This article was originally published on JasonCohenPittsburgh.org

Buying a Dog’s House: How Pets Influence Real Estate Purchases

People love their pets. One study by the National Association of Realtors found that 99% of pet owners view their pets as part of the family. Most of them take their pets into consideration when choosing a place to live and more than half renovated their homes for their pets. Animals simply have a huge impact on the choices that consumers make in the real estate market.

Demand for Pet-Friendly Housing is High

Pets are extremely popular in the modern world, so much so that more households have pets than children. That means that many people who are looking for homes are trying to find places that can accommodate their animals. Houses and apartments that offer pet-friendly amenities, such as big yards or fences, are particularly appealing. Homes that are close to veterinary clinics, parks, or other pet-friendly attractions can use those amenities as a selling point.

Investors also love pet-friendly housing. Apartments that accept pets tend to be more profitable than those that ban animals. Sellers can also raise the value of a property by renovating it to be more appealing to pet owners. Those amenities can also make it much easier to find someone to buy or rent a property. Many landlords are reluctant to accept pets, so those who do accommodate animals face relatively little competition in many markets.

Popular Improvements

Pet owners and investors alike can benefit from renovation projects. Fencing projects are among the most popular, but far from the only option. Pets tend to be messy, so they benefit from replacing carpets with laminate flooring to simplify maintenance. Smaller changes, such as installing bathroom fixtures that are appropriate for cleaning animals, can also make a big difference.

The Bottom Line for Investors

Modern homes need to meet the needs of both their human inhabitants and a variety of pets. They should be safe and comfortable for as many different species as possible. Investors and builders who make a point of accommodating pet owners are likely to do better than those who ignore the needs of cats, dogs, and other species. Just a little bit of extra effort can lead to higher profits for investors and a lifetime of joy for pet owners.

This article was originally published on JasonCohenPittsburgh.net

Four Vital Skills for Every Real Estate Investor

Real estate investing is not for the faint of heart. While it does offer the opportunity for a good return on investment, it also offers some risk. On the other hand, skilled investors can control that risk. There are a few things that every real estate investor should learn to make sure they can come out on top.

Knowledge and Research Skills

Knowledge is power, and power offers the potential to turn a profit. Real estate investors need to understand a huge variety of fields in order to excel. They need to know about investment strategies, their markets of choice, and how to assess a potential investment. The best investors never stop learning. They also understand how to conduct research, which ensures that they can study up on new markets as they appear.

Negotiation and Social Skills

Social skills are also vital for investors. They need to know how to strike a good deal to buy and sell their properties. It is also vital to practice networking. After all, the best way to hear about a new opportunity is to stay in touch with other professionals.

Emotional Control

Even the smartest, most experienced people make mistakes when they get flustered or frustrated. That often happens with inexperienced investors who experience a downturn or fail to close a deal. The best investors learn to control their emotions so they can take those setbacks without making any more mistakes. That can be the difference between solving a problem and turning it into a catastrophe.

Learning from Mistakes

No investor has a perfect record. Mistakes are simply a part of life. Every real estate investor will make a bad deal and lose some money from time to time. Even the best people in the field make the occasional mistake.

The ability to learn from those mistakes separates those top investors from the rest of the pack. They take the time to go over their records and figure out where they went wrong. They might have acted with insufficient information, or they may have hesitated too much instead of acting. Once they discover their error, they make an effort to avoid repeating it in the future. That can be hard to do, but it really is one of the most important skills for any real estate investor.

This article was originally published on JasonCohenPittsburgh.org

What Is Private Mortgage Insurance?

Many people, when purchasing their first home, do not have the 20% downpayment necessary to complete the sale. This 20% is necessary for the lender because it shows that the buyer has skin in the game and will not back out of their loan without losing a good deal of money. It is difficult for a first time home buyer because the buyer has not had a chance to build up equity in a previous home that they could then use for a downpayment in their next one. This is where Private Mortgage Insurance (PMI) comes into play.

Over 60 years ago, in 1957, the Mortgage Guaranty Insurance Corporation was founded as the first PMI company ever. It was the first competition available to the FHA market and allowed a new group of buyers to enter the housing market. This mortgage insurance allows the lender to underwrite loans even when the purchaser does not have the downpayment necessary. The PMI company uses these insurance payments to guarantee that the lender will not lose money on the sale and will pay the 20% downpayment if the buyer backs out.

The good thing about PMI is that it can be a temporary solution for the buyer while still allowing them to get into the home that they wanted. The buyer has the opportunity, as their home’s value rises along with the equity of the home, to refinance out of the PMI they initially purchased. Many lenders, once the 20% threshold is reached, will allow PMI to be taken out either through a refinance or sometimes even with a simple letter request. When this happens, the lender maintains the loan and the monthly payment for the purchaser decreases because PMI goes away.

While it is a fairly large monthly expense, without PMI there would be a lot more people renting houses and apartments. This monthly expense allows otherwise unqualified buyers to get into a home that they want and build equity rather than renting a home that builds equity for someone else. While it is not a perfect system because many people still default on their loans, it has worked for over 60 years and it has allowed more people to purchase homes that help them financially for the rest of their lives.

This article was originally published on JasonCohenPittsburgh.org