Top 5 Supplies for Self-Storage Storage

So you thought you were ready for your move, until you realized that you just don’t have the space needed at your new home to house all of your belongings. What do you do? Sell your stuff, or perhaps give it away? Sounds displeasing. Instead, consider renting a Portland self-storage unit for the safe keeping of those non-essential items you can’t seem to part with.

Self-storage units are the best way to store your excess inventory during what is sure to be a stressful time. And SpareFoot is here to make sure your self-storage experience goes as smoothly as possible, so we have prepared a top 5 list of the most important components of an organized, safe storage unit.

1. Locks. Despite the modern security features in many self-storage facilities, a sturdy lock should be your number one investment to ensure the safety and security of stored belongings. Discuss with your self-storage manager to determine which lock will be best-suited for your needs.

2. Boxes. Not only are boxes easier to stack and stow, but they will create much more usable space within your storage unit. You can find boxes for free at liquor stores and supermarkets (get there early in the week when fresh inventory usually arrives), or you can cough up a few bucks for new, more durable moving boxes available at your self-storage facility and most home improvement stores. Get uniformed sizing to avoid unbalanced mixing and matching, which will help facilitate a more accessible unit.

3. Tape. A good roll of duct and/or clear packaging tape is the perfect tool to seal your boxes. And be sure to stock plenty of it, you never realize how much you need until you run out.

4. Wrapping supplies. When it comes to padding, you can never be too safe. Save newspapers while you plan the move so you don’t have to go searching, and opt for bubble wrap to protect your more precious items. Small bubbles will reduce the shock of a dropped package to fragile items like glass, while larger bubbles are well-suited for protecting antique furniture items.

5. Shelving. An organized shelving system is what separates professional-grade storage spaces from amateur closets. Shelving makes your unit accessible, and facilitates your move by providing a designated spot for each item. Many storage facilities will equip your storage unit with shelving according to your specifications, or you can snag some on the cheap through Craigslist or Ikea. Just make sure to get the correct measurements first.

During your next move, try using the security and convenience of a self-storage facility. These units will have you rest assured that your belongings are safe and ready for you whenever it is you decide that you need them.

This article was written by Matt Schexnayder. Matt is on the SpareFoot marketing team and writes for the SpareFoot blog. SpareFoot is the largest online marketplace for self-storage with more than 5,000 self-storage facilities listed nationwide. SpareFoot offers consumers the most complete comparison shopping experience in the storage industry and has been a big part of the national moving and storage industry for over 3 years.

Despite indications that both the local real estate market and the local economy are ever-so-slowly stabilizing and/or improving, the ridiculous and the sublime often still reign supreme!!  I see two major obstacles to the real estate recovery:  extremely over-reactive mortgage lending practices and our new, revised and “improved” appraisal guidelines!  Of course, I realize that this is the pendulum swinging completely the other direction, as a reaction to the “loosey-goosey” mortgage loan underwriting which helped propel us into this quagmire!!!

Common sense has never necessarily been an element of acquiring a mortgage (not in my 25+ years of real estate sales and service), however some underwriting and appraisal requirements still completely floor me!!

For instance, a very well qualified young couple who are buying their first home and were more than approved for the conservative mortgage they were pursuing, received word the day before signing that closing would be delayed until his next paystub was submitted due to a PAY RAISE!!??  Really???

On the appraisal front, a newer well-maintained home I had listed suffered from a few minor dry-rot repairs (we live in the drippy state of Oregon, by the way, and dry-rot is a “state of mind”).  We were forced to have two re-inspections to get the repairs completed perfectly.  And, even though we supplied a photo of the required CO detector hanging on the wall and the wrapper from which it came, the underwriter had to have a receipt.  Really?  Now compare this to a total fixer property (that had been a drug “grow house” unbeknownst to the out of state estate trustee) and was so filled with trash and discarded furniture that you had to turn sideways to walk through the house, and the appraiser calls nothing/nada/zip! Really???

A seasoned investor, willing to put 30% down (to get the best interest rates) is told that’s not enough. Despite the fact that the duplex appraised for more than the sales price, the appraiser could not verify the new buyer’s proposed rents (since when are appraisers up-to-date on rental prices?).  And, even though the buyer showed multiple examples of current comparable rents, the bank insisted on more $$$ as a down-payment.  Really??? (By the way, the investor did get the rents)!

Regarding inspections and required repairs, I’ve always suggested to my sellers that they not necessarily spend their money for a pre-inspection of the house they are about to put on the market (unless there were extenuating circumstances).  A majority of buyers are going to insist on having their own inspection, for obvious reasons.  However, I recently had a situation that has made me re-think this recommendation.  A very clean, well-maintained house was short a few roof vents and, thus, there was some harmless black mold growing in the attic space.  Mold has become the new “asbestos”, “radon”, “lead-based paint” or “LP siding” (pick your decade).  I know all of these CAN be serious issues, but are often the subject of inspection over-reactions.  What could have been remedied by a spray bottle of clorox, water and a little elbow grease, became a relatively costly repair (as the buyers would not hear of a self-remedy and insisted on a contracted remedy).  Really???

These (unfortunately) are just a few of my most recent experiences.  Note:  I had to “change the names to protect the innocent” and mostly had to wait until these homes all closed and recorded to post this story, so as not to jinx the outcome!!!  :-)

January 2012 Portland Metro Real Estate Update!!!

The “word” for the last several months of market stats has been “improvement”.  And, last month was no different!!  Closed sales saw a 10.3% increase and pending sales saw a growth of 19.3%.  And, get this!!!  We are now at 5.3 months of inventory (there are currently 8,612 active residential listings).  In the last 3 years we have been at a high of 19.2 months of inventory and this is the lowest in that time period!!  The average sale price dropped 6.7% compared to 2010.  So, in some areas pricing is still declining, in other areas we are seeing some stabilization.

BUYERS:  What does this mean for buyers?  I still see a slow recovery, so I don’t believe that interest rates or pricing will improve so suddenly that you need to feel an undue sense of urgency.  That being said, a declining market is going down until it isn’t!  And, interest rates are low until they’re not!  So, not being a gambler I would begin whatever steps you might need to feel comfortable making that purchase.

SELLERS:  What does this mean for sellers?  Well, it at least gives us hope that our market might be moving towards more balance.  When is the market going to improve?  Probably not any time soon, but we are making some progress.  I do believe that we still have a lot of “shadow inventory” of short-sales and foreclosures that haven’t surfaced.  And, pricing is still “King”.  Stay tuned!

INVESTORS:  What does this mean for investors?  It’s a very solid investor market as rents have been rising due to a shortage of rental properties and more renters entering the market that have either lost their home or decided they can’t buy.  The vacancy rates are low.  Well priced, well located smaller plexes sell quickly so investors must be prepared with mortgage pre-approvals or cash.  But, they must also do their homework and make sure the property will cash flow (how much is based on your developed strategy).  Then you rely on the tenant paying down the mortgage every month to increase ROI (return on investment).

Why Pay Full Price?

No one wants to pay more than its value regardless of the product. When you buy anything at one store and see it for less at another store, it’s not the difference as much as it is about overpaying.  No one wants to overpay!

It seems like the natural way to start the negotiation process is to offer less than the asking price for the home, especially in today’s buyer’s market. However, instead of the price, a buyer could negotiate condition, timing or terms. A few thousand dollars off the price may not make much difference in the monthly payments but it might make a big difference if it was negotiated in one of the other areas.

A buyer who only has enough available funds for the down payment and closing costs will have to live in a home exactly the way it is for some time. They may not be able to make the changes that they desire until they’ve saved more money.

Let’s say you found a home that needed $5,000 worth of improvements and the seller would lower the price by that amount. Financing those improvements with a separate bank loan will result in higher payments due to a higher interest rate and shorter term than your mortgage (if you can even get that loan).  And, taking $5,000 off your asking price will not make as big a difference as might think (amortized over 30 years at today’s low interest rates)!!

Another idea might be to offer full price and negotiate with the seller to pay your closing costs so you’d have the cash to make the improvements.  You’ve already got diminished pricing and the lowest interest rates in quite some time!!!

Paying full price may cause the seller to consider concessions regarding condition or terms which can be balanced to affect the value of the property. Buyers can and should negotiate to acquire the home that meets their needs at the lowest possible cost of housing NOT just the lowest sales price!!!

Of course, all of this is idle chatter if the home is overpriced for the marketplace!  But, once buyers have been in the marketplace for even a short while, they are quickly educated to value.  Sellers: price to sell!  Buyers: offer to buy!

Why don’t more sellers offer “seller-carried-contracts”?:  There aren’t that many sellers in that position.  You’d have to have your home paid off or almost paid off.  I’m just surmising here, but interest rates are so low that, perhaps, many sellers know they can’t get the $$$/interest rate they would want to carry the burden of the contract.  Or, the seller has passed-on and the estate (could be multiple beneficiaries) wants to settle the estate, thus a seller-carried-contract is too complicated.

Why don’t more sellers offer “lease-with-an-option-to-purchase”?:  many times lease-options simply do not make it to close of escrow!  Home-ownership is based on a set of deep-seated psychological factors!  Like having a baby, you just can’t imagine how it will feel till you experience it.  And, like having a baby, once you’ve done it…there’s a level of commitment that you don’t experience till it happens!  And, that means that you’ve “bought it” (hook, line and sinker).  A “lease with an option to purchase” is like renting!  You haven’t completely made the transference and statistically (even with non-refundable monies up-front) they simply don’t close!!

Why don’t more sellers “wrap” an existing loan or have an assumable loan?:  Wrapping a loan involves monies exchanged between buyer and seller and the buyer assuming an existing loan.  Unless, the loan is an assumable loan (some FHA & VA loans are assumable, you’d have to check with your particular loan documents) it is not sanctioned by the underlying lien-holder (i.e:  the bank).  Thus, if the “wrap” was discovered your loan could be called (payable upon demand)!  So, that speaks to possible future value of FHA or VA assumable financing.  In the ’80′s they were gold!!  As interest rates went up (to 13% when I first started the business), any assumable financing (at a lower interest rate) was VERY attractive!!

DECEMBER 2011 PORTLAND METRO REAL ESTATE UPDATE!!!

Merry Christmas, Happy Hanukkah, Fabulous Festivus, Sensational Solstice…or whatever you embrace, believe or endure in this holiday season!!  And, what about the real estate market … you ask??? (or not).  Well, not so bad…not bad at all…relatively speaking!  It’s with tiny, incremental steps that we seem to be somewhat stabilizing. As was the case last year, we had an uptick in activity during this traditionally slower time of year.  Nationwide, existing Home sales were up 4% for the month and up 12% vs. a year ago.  Inventory is down 18% vs. last year, now at a 7 month’s supply. Housing starts were up 9.3% for November and up 24.3% vs. a year ago, while building permits were up 5.7% for the month.  In the Portland Metro area closed sales rose 3.2% for the month and up 18.9% in November 2011 compared to November 2010. Our local inventory is down to 6.2 months supply, which is the lowest in 3 years!!  All of this is “hand-in-hand” with generally more positive economic news, such as the initial jobless claims dropped to the lowest level since April 2008 and continuing claims are the lowest since September 2008. Plus, a better week in the stock market with a 3.5% weekly gain in stock prices, recouping the prior week’s slide!

BUYERS:  So, what does this mean for buyers? Interest rates remain at historical lows! Prices are low! The mortgage market is stingy with its money but not impossible! I would check out your options with a trusted mortgage broker. If you are thinking about your first home, its “cheap money” and with an FHA loan, you can get into a home with as little 3.5% down. Qualifying veterans can get into a home for 0 down with a VA loan! If you own a home and intend to stay and haven’t run the numbers to see if it makes financial sense to refinance, now’s the time to consider that option. If you need to adjust your living situation for more or less room or a lifestyle change, research what your home might sell for and what you could conceivably buy with your $$$ now.

SELLERS:  So, what does this mean for sellers? I’m not going to sugar coat it, if you want to sell you must get competitive with your pricing, condition and/or concessions/incentives. It’s still a buyer’s market. The good news is that when priced correctly, homes are selling! You need to compare losses while selling with gains when buying and see if the numbers make sense.

INVESTORS:  So, what does this mean for investors? If you can come up with the down-payment (10%-30% down), qualify for the loan and embrace a little extra responsibility, you could really make an excellent investment to round out your retirement and savings portfolio!! It’s simply another strategy to build wealth. The rental market is very good in the Portland area, generally with vacancy rates less than 4%. You use your down-payment + other people’s money (a Mortgage) to purchase a property. Your tenants pay that mortgage (PITI=principal, interest, taxes, insurance), you realize whatever cash-flow (rents minus PITI & maintenance=cash-flow). So, whether the real estate market appreciates or not, you accrue equity due to the tenants paying down the mortgage on a monthly basis.

So, I’m hopeful for our real estate market and excited in general for 2012!! I’m sensing a tiny glimmer of a light at the end of the tunnel.  Here’s wishing you, your family and friends happiness and health in the new year!

As a follow up to Tuesday’s blog regarding why would anyone try to sell a home or buy a home at this time of year, Blackwater Consulting pulled a year’s worth of data on three quarters of a million homes listed across the country and analyzed sales statistics by season. Here’s what we found:

• Homes listed in winter sell faster: 46 days in winter vs. 55 days in summer
• Homes listed in winter are more likely to sell: 59.2% sell in winter vs. 53.1% sell in summer
• Homes listed in winter sell closest to their original price: a 2.7% drop from the final price in winter vs. a 5.2% drop from the final price in summer, worth more than $7,000 on a $300,000 home

Homes listed in winter sell best.
Yup, you read that right: Overall, homes listed in winter sell best. 5.8% more homes listed in winter eventually sell (compared to the overall percentage of homes listed throughout the year), and they sell 1.4 percentage points closer to their original list price than the median—that’s $4,900 on a $350,000 home.

Spring wins in one category: Speed. Homes listed in spring sell the fastest, sitting on the market for 15% less time than the median. Winter comes in second in this category though, at six percent below the median, while homes listed in summer and fall both sell slower than the median (12% and 16%, respectively).

This is interesting and surprising information for me (a 25-year veteran of the biz)!  Why do you think most sellers are afraid to list their homes in winter?  I guess it’s not always auspicious to “wait for better times.”

There are lots holiday distractions.  It begins with Thanksgiving, includes whatever religious or secular celebrations you embrace and ends with ringing in a New Year!  It’s a terrifically exciting time of year with family, friends, holiday lights, shopping, parties, perhaps a bit too much eating and, for some, occasional alcohol consumption (or over-indulgence, as the case may be).  So, why would someone continue to market their home and try to sell during this season?  And, why would someone leave the mall to pursue a house hunt at this time of year?   You’ve got questions, I’ve got theories!

For the Seller:  Nothing is quite as enchanting as a home that is “lightly” decorated for the holidays.  It exudes warmth & welcome and could trigger “home n’ hearth” memories for the buyer.  There is less competition, as a lot home-sellers opt to remove their home from the marketplace during the holidays.  The buyers that are actually looking are usually serious, otherwise they’d be at the mall or elsewhere.

For the Buyer:  Normally consumers are vigilant about buying opportunities like Black Friday, Small Business Saturday and Cyber Monday along with sales, coupons and rebates.  Certainly, volumes have been written about the record low mortgage rates and that home prices have adjusted considerably lower in the last four years.  A more subtle indication of a home buying bargain is that statistics indicate that year-after-year, the average home prices fall in the fourth quarter.  The holidays beginning with Thanksgiving, winter weather and the distractions of gift purchases certainly contribute to lower home sales.  The smart buyer can take advantage of the end of the year to get their best possible deal on a home purchase.  The buyers willing to buck the trend could easily benefit from lower prices and less competition from other buyers.

Sale by Surviving Spouse

The IRS has given special consideration regarding the sale of their jointly-owned principal residence after the death of a spouse. If the surviving spouse does not remarry prior to the sale of the home, they may qualify to exclude up to $500,000 of gain instead of the $250,000 exclusion for single people.

• The sale needs to take place after 2008 and no more than two years after the date of death of the spouse
• Surviving spouse must not have remarried
• Both spouses must have used the home as their principal residences for two of the last five years prior to the death
• Both spouses must have owned the home for two of the last five years prior to the death
• Neither spouse may have excluded gain from the sale of another principal residence during the last two years prior to the death

If you have been widowed in the last two years and have gain in your principal residence, it would be worth investigating the possibilities. Contact your tax professional for advice about your specific situation. Contact me to find out what your home is worth in today’s market. See IRS Publication 523 – surviving spouse.

NOVEMBER PORTLAND METRO REAL ESTATE UPDATE!

Suddenly, we appear to be on the brink of wintertime, but what a truly glorious autumn we’ve had here in Portland!!!  Our summer home buying season has passed, but as we approach the holidays our real estate market still has some “teeth”.  As was the case last month, local sales activity in the Portland Metro area showed improvements in closed and pending sale this October 2011 compared with October of last year.  Closed sales were up 14.1% and pending sales up 15.1% and we now have 6.8 months of inventory (compared to 10.7 months of inventory this time last year).   Part of this sales activity is directly related to pricing.  Factoring in sales of foreclosed and other distressed properties, Portland home prices fell 4.4% in September compared to the prior year.  According to CoreLogic data, the five states with the highest price appreciation were West Virginia (up 13.2%), Maine (up 5.8%), Wyoming (up 4.8%), Montana (up 4.4%) and Kansas (up 3.9%).  The states with the greatest decline were Nevada (down 9.6%), Arizona (down 7.7%), Minnesota (down 5.9%), Michigan (down 4.8%) and Delaware (down 3.7%)!

SELLERS:  What does this mean for sellers?  It’s a very emotional market.  It’s still a buyer’s market, unless you’ve priced your home at a price that buyers consider a really good deal (at which time there are often multiple offer situations).  The first question you need to ask yourself is: Are you emotionally prepared to sell? Selling is a challenge for most sellers, although some markets are better than others. Unless you bought seven to 10 years ago (there are exceptions) and preserved your equity, you may not be able to sell for enough to pay off the mortgages secured against the property and the other costs of selling.  And, what about selling at this time of year?  Well, there’s less competition and if the rest of this calendar year proves to continue with the current level of activity (as it did last year), it could be a good time to be on the market!

BUYERS:  What does this mean for buyers?  At the risk of sounding like a broken record, today’s low, low interest rates and low, low pricing make for one of the best buying opportunities in 40 years!!  The average rate of 30, 20 and 15 year fixed mortgages have fallen to the lowest on record dating back to 1971!!  Recent projections call for another five or so years of bouncing along close to the bottom of this market cycle. Many experts believe that the big price declines are behind us.  I’m not going to sugar-coat it, getting a mortgage will make you close to crazy but you know what they say about “no pain..no gain”!!  For as little as 3.5% down, you could get into a house and quit buying someone else a piece of real estate!

INVESTORS:  What does this mean for investors?  In a rather lack-luster (albeit slowly improving) economy, investment real estate is a bright spot for landlords and investors. Rents are up, vacancies are down and potential tenants are plentiful as a result of the foreclosure crisis. In most parts of the Portland area, the vacancy rate is below 4 percent. Only two markets, east Vancouver and Oregon City, are at or above the 5 percent that is considered balanced, and most close-in neighborhoods of Portland are closer to 2.5 percent according to the Metro Multifamily Housing Association.

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