Photo by Ted Dawson

Investing in real estate just plain makes sense. At Green Light Real Estate, we advise investors who want to fix and flip houses, those who want to buy and hold single family, and multi-family investors.

Each of these strategies requires careful analysis, and deep local knowledge, which our real estate investment clients get when they work with Green Light Real Estate.

For fix and flip, it’s critical to pay attention to the location. The renovation numbers might be really attractive, and the purchase price may make a property hard to say no to, but if the location caps the after repair value at a price point that squeezes profit, then that’s a real thing.

Another big component of fix and flip investing in real estate in the Montpelier/Barre area is property layout. On HGTV, they’re forever putting cosmetic renovations on a 1980s ranch or colonial. Much of the housing stock around here, that is suitable for fix and flip is much older, and often has outdated layouts. You really want to make sure that your final product is going to be as universally attractive to buyers as possible.

At Green Light Real Estate we factor in layout as well as location (and about a dozen other variables) to help our investors get a firm and clear projection for after repair value. We want to help you have a profitable project. Our investors come back to us over and over for help with locating, negotiating, estimating budgets, and final sale price. If you’re serious, or even just curious about fix and flip investing in the Montpelier/Barre/Northfield area, give our office a call at 802-225-6425.

For our multi-family investors, Green Light Real Estate uses several different databases to get a good handle on values, cap rates, and optimal rents. Often, we can help our investors locate value-add opportunities to increase net operating income, cap rate, and cash on cash returns.

Cash flow is key with multi-family investing, but appreciation, debt paydown, and tax benefits also need to be factored into your decisions. Sometimes the most important part of our work with our real estate investing clients is to challenge their assumptions. It’s easy to get a project to look like a money maker on a spreadsheet. Having a trusted advisor punch holes in numbers, and then showing that the investment is still sound is incredibly powerful.

 

Call us at (802) 225-6425 to learn more about our multi-family investment services!

 

 

What To Do In August To Sell Next Spring

 

Photo by Ted Dawson

Well, if you’re reading this you’re either super interested in Montpelier and Barre real estate (which is great!) or you’re thinking that you’ve got just one more winter in your home.

 

It could be that next year is the year your last little bird leaves the nest. It could be that you’ve decided that this coming winter will be your last that you get to deal with snow. It could be you’re just ready to make a change, and you know what, no one needs to know your reasons, so there.

 

But if you have time and you’re planning, here are some things that you can do in the next few months to get your house ready to rock and roll come next spring.

 

Inside

-You knew it was coming...clean and declutter! You’re going to have to box all of it anyway, so go ahead and start getting rid of some of it. Yard sale, thrift store, Front Porch Forum, free pile, or storage unit. Just get rid of it.

 

-Paint. Paint is one of those things that most homeowners can do on their own. However, if you don’t have the time or desire to paint, you’ve got time to line up a painter to get it done. A word to the wise: Don’t wait until January to get painting done in February. Get in the calendar as soon as you can! Good painters get scheduled out quickly and they book far out into the calendar.

 

-Talk with a Realtor at Green Light Real Estate and find out what you house is worth, and more importantly get a detailed list of projects that will help you sell it as fast as possible and for the best price. The personal professional advice is SO valuable, don’t pass it up. 

 

Outside

-Landscaping and yard cleanup go a long way. As with painting, there’s lead time. Start planning now, and if you use a professional landscaper, get that person to the property this year to start the plan. If you’re going to list in May or June, you definitely need to have the landscaping looking top notch. But even if you’re going to be an early mover (list for sale in February or March), you can still benefit from cleaning up the yard and doing some advance planning.

 

-Paint any peeling or cracked paint. Trust me, if you wait until June to try to find a painter, you’re going to waiting until September. And that can derail a sale. Get it done soon (your Green Light Real Estate selling advisor can tell you exactly what would need to be painted).

 

The most important thing you can do now to prepare to sell in a few months is to get professional advice. Once you know what buyers, appraisers, inspectors, and buyer agents are looking for, you’ll know how to present your house in the best way possible.  When you work with Green Light Real Estate, you’ll get that advice. Even if you don’t ever list the house for sale.

 

Are you in the market to buy or sell? Get in touch! Call us at (802) 225-6425

Help! I Still Want to Buy a House This Summer!

Photo by Ted Dawson

First, it’s going to be ok.

 

Second, it might not turn out exactly 100% the way you dreamed it up in your ideal timeline. But, it’s going to be ok.

 

It does take 6-8 weeks to close on a home after the purchase and sale agreement has been signed. So, you have to add those weeks into your timeframe.

 

Most of that time is for loan underwriting and inspection resolution. If you’re not using a lender, then that timeframe can speed up. But if the person you’re buying from is using a loan for their purchase, you may still be in that 6-8 week realm.

 

Finding the right home can be tricky, which I’m sure you’re experienced. That, perhaps, is why you’re reading this post in the first place. Here are some strategies for getting into a house as quickly as you can.

 

1. In a seller’s market, when homes seem to be selling fast, and there are multiple bids on properties, you first need to acknowledge it. Acknowledge that sellers might have more power in the transaction than buyers do. 
2. You may have to be flexible on some features that you want. You don’t have to give up on everything, but keep an open mind. If you can get a house that is 80% of what you want, that might be the way to go. Keep an open mind. You can fix or change almost anything in a house.
3. Speed wins. Be ready to make an offer after seeing the house for the first time. Your night to sleep on it was someone else’s last night that they slept on it. If you like it, move fast.
4. Make an offer that the seller might actually accept. In a competitive market, buyers aren’t able to make low offers and engage in drawn out negotiations. The house is still being shown and marketed during negotiations, so even though it feels like you’ve moved fast and locked it up, you haven’t.  Also, a drawn out difficult negotiation may nudge a seller to actively seek other offers, using your offer as bait.
5. Use a competent and qualified Realtor. Sellers and listing agents want to make sure that the sale will actually happen. The better written the offer is, and the more connected your buyer agent is to the local real estate market, the better. Bringing in your sister from Colchester to help buy a house in Montpelier or Barre might not help your cause as much as you want it to. Better to bring in a local, skilled, experienced Realtor. Green Light Real Estate focuses on Central Vermont, and we know the area and the players really well. Listing agents have told us that they really like working with us on the buyer side because we’re collegial, professional, and we work as a team.
6. Start looking for a Plan B. Maybe you can extend your lease for a month or two? If you’re looking at a hard move out deadline, then you really should think about looking for a different rental. You don’t want to negotiate with your back against the wall. And you don’t want to be homeless.
7. If you haven’t yet, you really should schedule a free buyer consultation with Green Light Real Estate. When you have a deep understanding of the inventory and the process, and your Realtor really knows what you’re looking for, then the creative juices start flowing. Working together with your buyer agent will really help you refine your search, and give you an advantage over other buyers.

 

It’s going to be ok. Houses come on the market all of the time, in all months of the year. Sure, it might have been ideal to move the week of July 4 so you could have some extra days to pack, clean, and move. But that doesn’t always work. Be patient, be flexible, be open minded, be prepared, and then be ready to move fast. 

 

Are you in the market to buy or sell? Get in touch! Call us at (802) 225-6425

 

 

 

 

Photo by Ted Dawson

Your teachers always said that if you have a question, you should ask because. You’re probably not the only one with the same question. Well, I have a feeling that holds true even when we’re out of school. Here’s a real question asked by a real buyer:

 

Question:

If we’re buying a multi-family rental that we plan on living in, can we count the rental income toward our own income?

Answer:

Yup.

 

Most lenders will count at least some of the rental income from a rental property toward a buyer’s income. One lender I spoke with in person recently told me that they can count 75% of the rent toward a buyer’s income. Even if you don’t have landlord experience. Even if your income comes from 1099 income.

 

It’s best if there is a lease in place, so you can show the lender exactly what the tenant is supposed to be paying. But if there isn’t (yeah, I asked!), then a lender will have a market rent analysis completed as part of the appraisal.

 

If you can show that the other half of a duplex is renting for $900, with a lease or rental analysis, then you can count $675 per month as income for you, for qualifying (that’s $8100 annually). But with no lease, an appraiser would have to confirm what market rent would be for a similar unit. Presumably that would be around $900.

 

Why not 100%? Because we don’t live in a fantasy land, is basically why. That 25% cushion accounts for unexpected maintenance, capital expenditures, and vacancy (incidentally, when I run numbers for investors looking to buy multi-family in Montpelier and Barre, I use a 25%-30% cushion when calculating cash flow, the difference is whether I feel confident that the condition and layout will lower my vacancy to 0%-5%, or whether it’s more realistic to use 5%-10% for vacancy).

 

Even a few hundred dollars each month can make a difference in the ability for someone to buy a rental property in Montpelier or Barre. An owner-occupant can get an FHA loan on a 1-4 unit, and get in with as little as 3.5% as a downpayment. But, as of this writing, the FHA only allows the ratio of housing payments to gross income to be up to 31%. 

 

Which means that the extra $675 monthly that counts toward your income could increase your purchase power by $26,000. If you were approved for $150,000 for a single family home, you’d likely be approved for $176,000 for a duplex where you live in one unit and rent the other for $900 each month.

 

Different banks handle things differently, so make sure to ask your lender what their policy is on handling rental income. Also, loan decisions can be property specific. A straight side by side duplex might be treated differently than a large Victorian with a small accessory unit on the third floor. You’ve just got to ask about them.  And if you don’t get the answers you want, call a different lender. Or call us at 802-225-6425 and let us connect you to a lender who can help you.

May Market Report

 

Photo by Ted Dawson

	Active	Under Contract	Average Sale Price (last 12 mos)	# of Closings last 12 mos	Average Days on Market
Barre City	42	21	$137,215	88	79
Barre Town	29	13	$205,046	89	62
Montpelier	15	15	$263,376	72	69
U32	37	12	$238,587	83	119
Northfield/Williamstown	31	11	$212,905	78	67

 

	New Listings April 2019	Sales/12	Absorption Rate (# mos of inventory)
Barre City	16	7.33	5.73
Barre Town	6	7.42	3.91
Montpelier	8	6.00	2.50
U32	11	6.92	5.35
Northfield/Williamstown	10	6.50	4.77

Buyers are out there ready to buy, and it would be just lovely if there were a few more homes for sale. Especially in Barre Town and Montpelier. With just 2.5 months of inventory in Montpelier, and under four months of supply in Barre Town, those two are very clearly “sellers’ markets”.

 

Experts use six months of inventory as the threshold between a buyers’ market and a sellers’ market, which puts all of the Central Vermont markets solidly as sellers’ markets.

 

Buyers are being successful when they make solid offers, and when they have realistic expectations about inspection items. Even in this market, sellers need to price their homes correctly and be realistic about their home’s condition.

 

Are you in the market to buy or sell? Get in touch! Call us at (802) 225-6425

 

 

Should I buy or should I rent?

 

Photo by Ted Dawson

 

Ah yes, the time honored question. Should I buy or should I rent? If only it were that easy. A lot goes into that question, and a lot of it is long term, down the pike kinda thought.

 

But some of it is right in front of you.

 

The first question is...do you want to own a house or be a tenant? When you own, you have a type of freedom that renters don’t have. You can get a dog and paint the walls. You can plant your own garden and pick whatever type of towel rack you want. You can invest in energy efficient improvements and even change the layout. The list goes on and on. These are all choices that you get to make when you own.

 

Independence and Security

Many people report a sense of independence when they own. Especially, those who are first time buyers. Your entire life, you have had to ask if it’s ok to do something with your living space. That changes when you own. You don’t have to ask anyone (but if you live with at least one other person, it’s probably a good idea to at least talk about what’s happening with your house.)

 

Additionally, many renters feel a greater sense of security when they buy a house. A landlord can choose to raise rent, undergo renovations, or even sell the property. And there’s that a tenant can do about it, so long as the landlord is following the terms of the lease.

 

Sure, it can seem as if your landlord loves you. Maybe you even have a slightly below market rent because you’ve been there so long and you have a great relationship. But at the end of the day, as soon as the landlord decides to sell, you may be looking at finding a new place to live. 

 

As long as you pay your mortgage and taxes, when you own real estate you can stay there as long as you want.

 

Monthly Expenses

Which brings me to what I know you’re really reading this for. Does it make sense financially to buy a house, or is it better to rent?

 

Over time, financially, it almost always makes better financial sense to own than to rent. There are a few reasons for that.

 

Rent Check Vs. Mortgage Check

One is that if you have a fixed rate mortgage, your monthly payments will only go up as property taxes and insurance go up. In Vermont, that means that if your town votes to increase the budget, your tax bill is going to go up. So, if your property taxes went up $350, then you’d have to pay an extra $30 each month.

 

Many landlords increase by 2% to 3% (or more) each year anyway. But what happens if your landlord realizes that they could charge 10% more and still keep tenants? Your $1000 monthly rent just went up by $100. And what are you going to do about it? Well, you’re either going to pay it, or you’re going to move out. 

 

And guess what? If the place your renting should really be renting for could fetch $1100, then you’re going to have to pay that somewhere else. Either that, or you’re going to move to a place that’s not as nice, or not as desirable a location for you.

 

But when you own, no one’s going to unexpectedly jack the rent on you.

 

Maintenance, Repairs, Utilities

I’ll admit, one of the most awesome things about renting is that you’re not responsible for most repairs and maintenance, or for some utilities. It’s kind of nice to have someone else cover that for you.

 

But, ready for a dirty little secret? Most maintenance isn’t really that hard. And you can usually plan for the big things that come up (See blog post: How long do things last, and how much do they cost?)

 

You can learn to fix a toilet, change an outlet, repair handrails, and all sorts of light carpentry. And honestly, if you really don’t want to, you don’t have to. You can hire someone to bang those things out. There aren’t too many things in a house that really need to be repaired at three in the morning. (See blog post: repairs that you have to make at three in the morning, and how to avoid having to do them by planning ahead)

 

Get the furnace checked, pump the septic tank, keep an eye on the roof, hit peeling paint when it comes up. Those are normal maintenance items that you get to perform. And in return, you get...

 

Appreciation

Yeah, this is the fun part. You bought your house, and you’ve kept it up. Home values go up and down in cycles, but over the long term, residential real estate has appreciated at around 3% annually. Which means if you just kind of keep your house in decent shape, your $200,000 house is likely to be worth around $268,000 in ten years. So, in appreciation alone, you’d have an additional $68,000 in net worth.

 

If, instead, you had rented for those ten years, your real estate net worth would still be, hmmm, let’s do the math here...zero.

 

And yes, I know that you could have taken the difference in monthly payment, maintenance, repairs, etc. and put it in a savings account or invested in a mutual fund. But would you? Really? Really??

 

Mortgage Pay Down

You would also be paying down your mortgage each month. At first, just a teensy part goes to paying down principal, but those decreases add up. In those ten years, your original $200,000 mortgage would be down to $162,000 (assuming a 30 year loan at 5% interest). 

 

Which means you just tacked on another $38,000 in net worth.

 

Which also means that in ten years, your net worth increased by over $100,000. While it’s not all about money and net worth, all things equal, most people would prefer to have an extra $100,000.

 

Summary

If you can, it almost always makes financial sense to buy instead of renting. You get independence and security. You can account for the hassle of ownership by following a regular maintenance and repair schedule, or hiring someone to do it for you. Over time, market appreciation and mortgage pay down will add to your net worth.

5 Ways to Prepare for your Home Sale

(all under $1000!)

 

  Photo by Ted Dawson

If you’ve got a year or two before you’re selling your house in Vermont, then go ahead and tackle some bigger projects. Update the countertops, redo the old carpeting, paint the exterior, etc. But for this post, we’re talking about things that you can do pretty quickly, and for not a whole lot of money. 

(Author’s note: This was written to people selling houses. But items 2-5 apply to homeowners as well, and you’ve probably already done the first item. These will help you enjoy your home, keep it ready for resale, and allow you to look past some relatively inexpensive cures when buying your home in Vermont.)

 

The truth is that it almost always costs a little money to get your house in top form for a quick, best -sale (bonus: these tips will help your escrow close more smoothly, meaning less stress, less uncertainty, and less “yuck” factor.)

 

1. Get a professional home inspection, including a radon test, (and, if you’re on well and/or septic), get the water tested and the septic tank pumped and inspected. Who knows what you’ll find on that report. Maybe nothing. Maybe your house is like one of those people who exercises all the time, has great genes, and eats a plant-based diet. Kind of annoyingly perfect.

 

If that’s the case, then we’d have documentation from a third party to back that up. Sometimes the report itself is enough to give a buyer peace of mind.

 

But more often, things will come up. Usually little things. Usually things that if you really think about it you might have thought needed to be addressed anyway. Then, here’s the fun part, you just get those things fixed and updated. It’s as easy as that!

 

2. Clean the H out of your house. I mean EVERYTHING. Dust the baseboards, clean the oven (there’s a button for that on the oven, so that’s not really that hard…), get rid of the cobwebs in the basement, mop the floors. Everything. And then keep it spotless. 

 

If you’re like many people, cleaning your house isn’t your favorite thing. Hire a cleaner. Simply getting some help once a week or every couple of weeks will make a humongous difference. Between cleanings, it’ll be a lot easier to spot clean or pick things up before showings

 

Plus, you’ll probably really like not having to wipe down a bathtub. And your house will look awesome.

 

3. Paint the interior. Ok, maybe you don’t need to paint every room. But if it’s been two or three years since a room or hallway has been painted, just do it. It’s stunning the difference that a coat of paint (yes, it may take only one coat, if you’re not changing colors) makes.

 

Painting is one of those homeowner skills that seems easy. Be honest with yourself. If you stink at painting, or your edges look like the silhouette of a mountain range (you know who you are!), get a professional. True, that’ll cost more than $1000, but it’s worth it.

 

And on paint...color trends change over time. Light is always a good choice. White is always a good choice. Stay away from the dark greens and dark reds that were popular in the 1990s and early 2000s. And please stay away from pastels. If white walls are boring to you, pick one wall in a room as an accent with a more fun color. But, honestly, you can liven up a room with a colorful print or painting just as easily, and you’ll be much less likely to hear a buyer say, “I just don’t know about that color!”

 

4. Update your lighting. Again, fashions and styles change. If it’s been 10 years since you have changed light fixtures, you now have permission to change them. This isn’t the place to be super cheap (says a guy who’s been called cheap before. ) Yes, I know you can buy a $10 ceiling fixture from a hardware store. But don’t. I mean, if that’s truly all your budget allows, then do it. You’ll be able to find stylish fixtures for $40-$50, or more.

 

As an exception--if your house is older and has older (but cool) lights, keep them. Here I’m talking the 1930 Craftsman lights or period wall sconces.

 

Chrome and brushed nickel are popular now. Rubbed bronze, brass, and gold look dated. Track lighting works, but not the ones from 1980. Your Green Light Real Estate agent can give you honest advice on what looks good and what needs updating. We also work with interior designers and stagers whose ideas and visions will blow you away! 

 

And while you’re at it, spend another $100 and replace any switches, outlets, and cover plates that are old or dirty. Plain white ones from the hardware store work just fine here.

 

5. Tie up any loose ends around your house. Just about everyone has a list in their head containing repair or updates they’ve always wanted to do, or projects that need to be finished. NOW is the time to do that. 

 

That might mean hiring a contractor or a handy person. Maybe you took the project as far as you could go, and then realized you were a tiny bit in over your head. (I’m looking at you, baseboards that didn’t get coped, but instead only butt jointed). 

 

Common things to fix include loose caulk, cracked tiles, dangling wires, stains on carpet, unpainted patch jobs, etc. Usually these are little things. But we’re all busy. While it might take a contractor a couple hours to finish, it might take you a full day. Which means Saturday. Which means you miss a day with your family or hanging with your friends. Which feels REALLY expensive. 

 

So, commit to doing it, or commit to getting someone to do it. Either way, that “to do list” needs to get done.

 

Taking on these five relatively inexpensive repairs and improvements will reap huge rewards when you sell your home in Vermont. Routinely, we see that homes with few inspection concerns, updated lighting and paint, no deferred-maintenance, and that are super clean sell faster. They sell for higher prices. And they are much more of a “sure thing” when they get into contract. 

 

For more information or, for a personalized pre-selling walk through with a real estate professional, call, text, or email Green Light Real Estate, right here in Montpelier.

 

 

The December Market Report is Here! 

AKA: So, How's the Market?

 

By the Numbers

	On the Market (Active)	Sold Last 12 Months	Avg Sale Price
Barre City	39	90	$136,958
Barre Town	32	92	$202,923
Montpelier	22	74	$260,053
U32	46	80	$251,853
Nfld/Wmst	35	73	$213,216

 

 

So We Can Help You Even More

In November, several Green Lighters attended the annual conference for the National Association of Realtors.

We took sessions related to getting more exposure for our seller clients, improving client service, increasing the effectiveness of buyer consultations, and of course, marijuana and real estate. Because why not! Six of us attended the conference, taking in dozens of hours of training and education from world-class presenters.

 

 

Winter is a Great Time to Buy a Home!

Because…

-Many sellers are motivated to strike a deal.

-Escrow can close faster as inspectors and appraisers are easier to schedule.

-There are fewer buyers to compete with.

-You can see the real story behind your new commute. And your new driveway.

Go to www.GreenLight-RealEstate.com and read the full article in our blog.

 

 

Green Light Real Estate has 13 core values that we live and work by.

One is “We choose to be happy and not to bring troubles to work.” This ensures that no matter what’s happening in the world, or our worlds, when we work with buyers, sellers, and each other, we choose to be happy.

We don’t let negativity bring us down, and we don’t let setbacks keep us down. That keeps transactions moving forward, and, as importantly, makes it fun to come to work each day!

 

 

Market Slice!

How long are homes taking to sell? Different towns tell different stories, but all the information is interesting!

 

	Avg Days on Market 2018	Which was faster than 2017 by:
Barre City	80	33%
Barre Town	68	38%
Montpelier	77	-1%
U32	130	1%
Nfld/Wmst	74	28%

1/1/2017-12/1/2017, and 1/1/2018-12/1/2018

Homes in Montpelier actually took 1% longer in 2018 than 2017, but by just a tiny amount. There, there, it’ll be ok.

Montpelier ArtWalk is Friday 12/7

This is one of my favorite things about downtown Montpelier. Montpelier Alive organizes ArtWalk, in which downtown stores and offices (including Green Light Real Estate, of course!) transform their space into art galleries. In years past, we've hosted painters Danny Hendershot and Andrew Wible.

For the December ArtWalk in Montpelier, our featured artists are Montpelier photographers Ted Dawson and Paul Contino. They're telling a story of being new to Montpelier, in the context of a year's passage of time.  Photos come in different sizes, and can be purchased. Or, they can simply be enjoyed at the venue.

For more information, here's a link to Montpelier Alive, which organizes the event.

We'll have food and drink, and the artists will be on site to talk about their work or answer questions. The Montpelier ArtWalk is Friday 12/7 from 4:00-8:00. There are 26 venues. The event is free, open to the public, and is appropriate for all ages. 

Give your spirit a bit of a lift tomorrow afternoon, and check out some really talented local artists!

**Bonus** To further uplift your spirit, Green Light Real Estate is raising funds for breast cancer awareness and treatment through the American Cancer Society's "Real Men Wear Pink" campaign. All donations are greatly appreciated, and can be done in person, through the website, or with a phone app. Here's a link to the donation page. And here's a link to additional information about breast cancer.

7 Easy-ish Projects That Even the Least Handy Homeowners Can Do

As in...me. I might not be the least handy homeowner, but I'm in the running. Having said that, here are seven projects that just about anyone can tackle in a weekend with a couple simple tools, a bit of creativity, and a few hours.

I'm grinning as I'm writing this, thinking about the removable wallpaper for accent walls!

Here's the link to the whole article, from Realtor.com. but if you don't have 45 seconds to read that short article, here's a summary. Yes, a summary of a 45 second article.

1. Update your kitchen backsplash.

2. Install a smart thermostat.

3. Create an accent wall with removable wallpaper.

4. Create extra storage.

5. Give hardware and fixtures a fresh look.

6. Swap out your showerhead.

7. Wait for it...Apply a fresh coat of paint.

Maybe I'll see you at Allen Lumber, Aubuchon, or Nelson Ace Hardware soon...