Buying a condo is not the same as buying a home

Stringent lending policies and the escalating costs of home ownership have led many prospective home buyers to consider condominiums instead of single-family homes. Condos are typically less expensive than single-family homes, which makes lenders and borrowers alike feel more comfortable. Lenders feel better because the loans aren’t as large, while borrowers are more comfortable because such loans allow them to improve their standing with lenders, potentially setting the table for a low-interest home loan down the road.

But the differences between buying a condo and buying a single-family home go beyond the bottom line. The following are a few things prospective buyers should know about condos before they view any properties.

 Condos come with fees. Unlike single-family homes, condos come with homeowners association fees. These fees cover the cost of maintenance and repairs to the property. This includes landscaping and garbage collection, as well as general repairs throughout the condominium complex. Fees vary significantly from community to community, and the best deal is not always the one with the lowest homeowners association fees. Low fees tend to provide less bang for the buck, generally covering only the most basic services. Higher fees often mean the community offers more amenities, such as a private pool and gym for residents. Some people prefer such amenities, while others would rather find better deals on their own. But prospective condo buyers must include fees in their monthly budgets when determining how much they can afford to spend.

 Condos come with rules. Owners of single-family homes can create their own rules for their households, while condo owners must agree to follow rules established by the homeowners association or the property management firm responsible for maintaining the community and enforcing the rules. Rules may not allow pets or only allow pets of a certain size. Other rules may restrict how owners can decorate their condos during the holiday season or how they can furnish the exterior of their properties, limiting patio furniture to a set number of chairs or tables. Some condo owners are glad such rules are in place, while others might find such stipulations intrusive. Each community has different rules, and prospective buyers should familiarize themselves with a community’s rules before buying any properties within that community.

 Condos often have management firms. Property management firms can be great to deal with, but they can be troublesome as well. A good property management firm produces satisfied community members who speak glowingly of their communities, while a poorly run management firm can frustrate homeowners who feel they are not getting what they’re paying for. Some property management firms fail to collect homeowners association fees for months at a time, only to send letters demanding back dues down the road. Others simply don’t live up to expectations, failing to make repairs in a timely manner while letting the property fall into disrepair. If possible, speak to current community residents about how the property is managed. If residents are not available, potential buyers should attempt to attend a homeowners association meeting, which can shed light on what it’s like to live within a given community and how accessible the management firm is to community members and how well it tends to those members’ needs.

 Condos are not as private as single-family homes. Much like apartment dwellers, condo owners often share walls with neighbors. That means condo owners will have to sacrifice some privacy. Prospective buyers who consider privacy a top priority may want to continue living in an apartment until they can afford to buy a single-family home. Though condo owners rarely have someone living above or below them, sharing walls with neighbors is still not as private as owning a single-family home.

Condominiums are great options for people who want to own their homes but don’t have enough money or credit history to buy a single-family home. But buyers must educate themselves about condominium life before signing on the dotted line.

What to expect in 2016

By Carley Lintz
CTW Features

 Moderate gains in prices and sales to help drive ‘normal but healthy’ housing market Moderate gains in prices and sales to help drive ‘normal but healthy’ housing market Is buying a new home one of your New Year’s resolutions? Well, you’re not alone. The forecast for the 2016 housing market is one of solid growth and a strong desire to buy, according to two new reports on real estate trends from The National Association of Realtors and Realtor.com, respectively.

Total home sales are expected to reach 6 million, the highest level since 2006, according to Realtor.com’s 2016 housing forecast. New housing construction is a driving force behind this growth, increasing 12 percent year over year and new home sales rising 16 percent. Existing home sales are slower at 3 percent year over year.

“Next year’s moderate gains in existing prices and sales, versus the accelerated growth we’ve seen in previous years, indicate that we are entering a normal but healthy housing market,” Jonathan Smoke, chief economist for Realtor.com, said in statement. “The improvements we’ve seen over the last few years have enabled a recovery in the existing home market, but we still need to make up ground in new construction, which we could begin to see in 2016.”

Continued job creation and a 2.5 increase in gross domestic product also point toward a healthier housing market, although only half of the respondents to the NAR’s Housing Opportunities and Market Experience survey said they believed the economy is on the mend. Another 44 percent think it’s actually in a recession. “The promising stretch of job creation in several parts of the country in recent years has the housing market in 2015 on track for its best year of sales since the downturn,” Lawrence Yun, the NAR’s chief economist, said in a statement. “However, that only half of surveyed households believe the economy is improving can be attributed to the fact that some areas have been slow to recover and wages have yet to grow in a meaningful way for far too many families.”

Potential homebuyers are mostly tempered by higher mortgage rates and mounting home prices. Fifty-three percent of renters surveyed by the NAR said that they don’t own a home because they can’t afford it.

As mortgage rates are expected to rise to 4.35 percent for a 30-year fixed loan by the end of 2016, it makes sense that about two-thirds of renters think it would be very or somewhat difficult to obtain a mortgage.

Overall, though, the outlook according to both reports is positive.

Realtor.com expects sales to be propelled mainly by three groups: older millennials looking for their first homes, young Gen Xers with families, and retirees looking to downsize.

Renters looking to become homeowners also are expected to boost sales — 83 percent of renters said they want to own a home in the future and 77 percent said that homeownership remains a part of their American dream.

Both current homeowners (82 percent) and renters (68 percent) said they feel positively about the market and that it’s a good time to buy a home. Many current owners (53 percent) also felt strongly that it is a good time to sell your home.

The markets that will see the biggest growth in 2016 have a growing housing formation, a prosperous job market and low unemployment rates as well as large populations of the aforementioned groups likely to buy.

Realtor.com’s Top 10 hottest markets for 2016 are:

1. Providence, R.I., and Warwick, Mass.
2. St. Louis
3. San Diego/Carlsbad, Calif.
4. Sacramento/Roseville/Arden/Arcade, Calif.
5. Atlanta/Sandy Springs/Roswell, Ga.
6. New Orleans/Metairie, La.
7. Memphis, Tenn.
8. Charlotte/Concord/Gastonia, N.C.
9. Virginia Beach/Norfolk/Newport News, Va.
10. Boston/Cambridge/Newton, Mass.

© CTW Features

BUSINESS BRIEFS

Kathy Lo Bue, managing director at Glen Eagle Advisors, Freehold, will host Walter O’Brien, CPA, from 7-9 p.m. Jan. 13 at St. Robert Bellarmine Parish Center, 61 Georgia Road, Freehold Township. “How to Become Financially, Physically and Spiritually Fit in All Areas of Your Life” is a free and non-sectarian event open to the community. Details: 732-866-6660.

Megan E. Galla of Manalapan has been named the banking center manager at Provident Bank, 3514 Route 9 South, Freehold Township. Galla will lead and manage a team of sales and service professionals and oversee daily branch operations. She is a graduate of Rutgers University and is a certified notary public.

Russell Brokstein, a Freehold chiropractor, will participate in the Association of New Jersey Chiropractors “Baby It’s Cold Outside” annual food and winter coat drive. From now through Jan. 4, nonperishable food items, coats, hats, gloves and scarves can be dropped off at Hometown Family Wellness Center, 9 Broadway, Freehold. Items will be donated to the Open Door Food Pantry and St. Peter’s Thrift Shop, both in Freehold. Details: 732-780- 0044.

LeTip of Manalapan meets at 7 a.m. every Thursday at the Battleground Country Club, 1 Covenhoven Road, Manalapan. Several positions for local businesses are still open. Details: Jeff Weiss, 732-536- 8800, or Brian Wong, 908-581-6288.

Firm advice: Consider both agent and brokerage

If you’re thinking of buying or selling, chances are you’ll select your real estate agent based upon a name referred from a friend, neighbor or relative.

Referrals are the No. 1 way both first-time and repeat buyers and sellers settle on an agent, according to surveys from the National Association of Realtors.

But when a specific agent is recommended, should the name of the realty firm he’s affiliated with also matter?

Probably, say many agents.

The agent who worked out well for a trusted friend or relative may likely be associated with a new firm now. In a 2015 survey of its members, the NAR found that 30 percent were with their present firm for one year or less, compared to 18 percent in 2014.

Some newly affiliated are brand new to the profession, but doubtless many have switched firms, acknowledges Maggie Kasperski, a spokeswoman for the NAR.

“One thing sellers should ask about is whether the brokerage has a strong web presence so that their home is easy to find,” advises Angie Lotz, of RE/MAX All Pro in Bloomingdale, Ill., noting that many buyers shop the Internet vigorously.

Firms will differ in their offerings of search technology, too. For instance, buyers glued to their smartphone should put a priority on whether an app is available giving “real-time information,” says Cindy Soderstrom of RE/MAX Signature Homes in Hinsdale, Ill. Also, the commission charged a seller can be influenced by a brokerage’s policy, adds Erika Villegas, broker associate with ERA Mi Casa in Chicago.

Judge independent and national Realty firms equally, advises Marina Krakovsky, author of “The Middleman Economy” (Palgrave Macmillan, 2015), noting that what’s important is the firm’s local reputation.

— Marilyn Kennedy Melia
© CTW Features

Automakers accelerating on auto-braking

By Jim Gorzelany
CTW Features

 Your next car could apply the brakes on its own to help avoid a collision Your next car could apply the brakes on its own to help avoid a collision Perhaps as the first step toward driverless cars, expect advanced safety systems that can help drivers avoid, or at least lessen the effects of a crash to become widespread in the not-too-distant future.

Ten automakers recently committed to making the potentially life saving systems standard in all their vehicles sold in the U.S., presumably over the next few model years. They include Audi, BMW, Ford, General Motors, Mazda, Mercedes- Benz, Tesla, Toyota, Volkswagen and Volvo. Together, these companies were responsible for 57 percent of U.S. light-duty vehicle sales in 2014.

Other automakers could follow suit, and has been the case with important safety features like antilock brakes and electronic stability control, there’s a possibility frontal crash protection could one day be mandated for use in all cars by the federal government.

Until recently limited to the luxury car segment, frontal crashavoidance systems are fast becoming prevalent among more affordable cars and crossovers, though they’re usually offered only on costlier versions within a given car line, and are often bundled with other features in expensive options packages.

A forward collision warning/prevention system uses radar, cameras or lasers to monitor the distance between a vehicle and the traffic or other obstructions in its path. The same hardware is also used in a vehicle’s adaptive cruise control system that maintains both a set speed and distance from the traffic ahead. Basic systems will engage visual and audible alerts if it determines the car is closing in at a potentially hazardous rate of speed and pre-charge the brakes to maximize their stopping power. A full-blown collision avoidance system will go a step further and automatically apply the brakes at full force if the driver isn’t reacting quickly enough.

Most such systems operate at higher speeds with the intent of saving lives, though a few models, specifically those from Volvo and Mazda, are also selling separate auto-braking systems that operate at slower speeds to avoid fender benders in stop-and-go traffic. A few Infiniti models further offer lowspeed systems that will automatically apply the brakes while backing up to avoid hitting pedestrians and other vehicles.

According to a report conducted by the Insurance Institute for Highway Safety in Arlington, Va., autobraking technology can reduce insurance injury claims by as much as 35 percent. “The evidence is mounting that AEB is making a difference,” says IIHS’ president Adrian Lund. “Most crashes involve driver error. This technology can compensate for the mistakes every driver makes because the systems are always on alert, monitoring the road ahead and never getting tired or distracted.”

In order for a vehicle to earn IIHS’s highest Top Safety Pick+ designation, it must offer an automatic braking system in one or more of its versions. Vehicles earning a “superior” rating are able to successfully avoid a crash or substantially reduce a vehicle’s speed in tests conducted at 12 and 25 mph. To garner an “advanced” rating a vehicle must include an autobraking function and be able to avoid a crash or reduce speeds by at least 5 mph in either of the two tests. Forward collision warning systems that meet performance criteria set by the National Highway Traffic Safety Administration and autobrake systems that provide only minimal speed reduction in IIHS tests earn a “basic” rating.

As of this writing, the IIHS has given a record number of models a “superior” rating for forward crash avoidance when properly equipped, including the 2016 Acura ILX, MDX, RDX and RLX; 2016 BMW X3; 2015 Chrysler 300 and its twin, the 2015 Dodge Charger; 2016 Honda Accord Coupe and Sedan, 2015 Mercedes-Benz C-Class, CLA and E-Class; and the 2016 Mazda 6 and CX-5. The 2016 Volkswagen Golf, Golf SportWagen, Jetta and 2015 Volkswagen Touareg are deemed “advanced” for front crash prevention.

© CTW Features

Unequal DUI laws

Q&A with Sharon Peters

Q: My nephew has been picked up for driving impaired at least four times. Very little in the way of punishment ever happens. And still he drives. In my part of the country, he would have lost his license years ago, and probably would have done time. He lives in Pennsylvania. Is that known as a state that does nothing about DUI?

A: You are correct in supposing that law enforcement/ courts can treat such individuals very differently from state to state. Pennsylvania is among the 10 most lenient states (ranking number 49 out of the 50 states and District of Columbia) when it comes to how strictly DUIs are approached, according to WalletHub, which did a recent analysis of DUI enforcement rules across the country. The group examined 15 metrics, including minimum jail sentences to ignition interlock devices (which are regarded by many as a highly effective deterrent to keeping drivers who have driven drunk or stoned in the past from repeating that behavior).

Any number of approaches could be used, of course, to assess how harsh or lenient the laws relating to DUI are written … and, especially, applied. This methodology may or may not lock in on all that contributes to whether a state is a crackdown state or a soft one.

MADD, using different methodology, also put together a list of the 14 most lenient states. Pennsylvania was on that group’s list, too.

All this seems to confirm your suspicions.

Readers comment: Several terrific readers got in touch with me after a recent column in which I answered a question about gas caps not consistently being on the same side of cars, and that can lead to confusion at the pumps when one is driving a rental car or the vehicle of a spouse or someone else. “I agree with all you wrote,” one reader commented, “that it would be easier if you could count on them being on one side or the other. You should have pointed out, though, as I remember you did several months ago, that in most vehicles there is a symbol on the gas gauge that indicates which side the gas cap is on.” Indeed I should have. I always appreciate the reminders!

© CTW Features

What’s your question? Sharon Peters would like to hear about what’s on your mind when it comes to caring for, driving and repairing your vehicle. Email Sharon@ctwfeatures.com.

Home shopping 101

By Marilyn Kennedy Melia
CTW Features

 Buying a home is unlike any other purchase. Here’s how to stay focused while on the house hunt. Buying a home is unlike any other purchase. Here’s how to stay focused while on the house hunt. Home buying ranks as the biggest purchase most people make, not just measured by dollars, but by decisions.

When buyers reach the closing table, it’s the culmination of many carefully weighed choices to select the home that best suits their wants and needs. Or at least, that’s how it should be.

It’s not easy to be sure-footed through every step, especially for first-time buyers. But experts can provide guidance on navigating the twisting path, ending at the right new home for you:

Meet with a lender

This is not the fun part. Most real estate agents insist buyers get “pre-qualified” — meaning lenders estimate the amount of mortgage a buyer is eligible for — before visiting properties.

“There is no sense in looking … if you haven’t validated what price range you should be shopping in,” explains Cara Ameer, a broker-associate with Coldwell Banker Vanguard Realty in Ponte Vedra Beach, Fla. Even a preliminary discussion of how much your down payment will be, your credit and debt picture and other financing factors involves a host of decisions.

Prioritize preferences

What do really want in a home? Probably lots, like being in a great school district, having a shorter commute to work, or huge closets.

Wish lists differ, with some putting a priority on items others don’t even rank, such as the quality of cell phone service in a condo, notes Jim D’Amico, owner of Century 21 North Shore in Boston.

Analyze your priorities carefully, advises Dr. Seung Hwan Lee, a professor at Colorado State University who has studied buyer’s remorse. If an item you’re ranking highly, for instance, is dependent on other future events, it could be a mistake to choose primarily on that priority. Lee illustrates: “If you buy a home that’s smaller than you want but choose it because of the school district, and then decide to send your son to a private school, you could regret [your choice].”

Scrutinize, scrutinize, scrutinize

In the its 2014 Profile of Buyers and Sellers, the National Association of Realtors noted that 43 percent of buyers said they first looked at properties online, a share that’s been steadily increasing.

When browsing online, buyers typically view a shot of the front exterior first, says Michael Seiler, a professor of real estate and finance at The College of William and Mary. “Only if they like it will they read the property description,” he adds.

But the photos can be misleading, warns Seiler. “Don’t fall in love with a home on the Internet. There’s no substitution for a personal visit.”

When you’re interested, go back at different times of the day, and on a weekend and weekday, advises Ameer. Then leave no door or drawer unturned, checking space in closets and cabinets. Then walk both the inside and outside, noting conditions down to any scuffs on moldings.

Pinpointing ‘the one’

It will be a mix of practical reasons and intangible, emotional factors that come together on a particular property, giving you the sense that a particular property is right for you, says Lee. Beware, though, that sometimes the most “practical” choice is not the best in the long term, warns Ran Kivetz, a Columbia University professor who has studied consumer satisfaction.

While he doesn’t advocate over-spending, Kivetz says that some consumers shy away from appealing features — anything from more square footage to a lavish landscaping — because they feel guilty about the indulgence.

Checking with a financial adviser on the expenditure might provide a clearer view of what’s practical and most appealing, Kivetz concludes.

© CTW Features

Playing the price is right

By Marilyn Kennedy Melia

Who knows a home better than its owner? No one recognizes details, like the subtle “swoosh” the furnace makes firing up, or how the morning sun shines on kitchen counters, than a proud owner.

But there’s one important aspect of their home that owners often can’t grasp: It’s current value.

When they’re selling or refinancing, sellers must “price based on today’s existing marketplace, not what they hope it’s worth,” notes John Pinto, broker-owner, Realty World, San Jose.

In a monthly survey that Quicken Loans has been conducting since 2006, which compares the value that a professional appraiser puts on a home against the owner’s opinion, the appraised value usually is lower.

Indeed, in September 2015, for the eighth month in a row, owners have overestimated their home’s market value.

Luckily, though, the difference is minimal, just 2 percent. That’s a sign that the housing market overall hasn’t seen quick drops or upticks, notes Quicken chief economist Bob Walters.

In the period from 2008 through 2011, owners’ estimates were 10 to 15 percent under appraisal values. That was the immediate aftermath of the housing crisis, when prices were falling rapidly, notes Walters.

“Appraisers are looking at prices everyday,” he explains, and in markets with quick prices rises or falls, appraisers see the trends more clearly. Still, appraisal is “combination of judgment and scientific methods, so it’s entirely possible for two well-qualified appraisers to arrive at different opinions for the same property,” says Lance Coyle, president of the Appraisal Institute.

It’s fairly rare for a purchase to be derailed because buyer is paying above the appraised value, says Walters.

But it’s not uncommon for an owner to think his home’s value has risen so much that he can refinance and get cash-back, Walters adds.

While “homeowners don’t have access to the same data as appraisers,” says Coyle, “visiting open houses in the neighborhood could give a good indication of how similar properties are priced.”

CTW Features

REAL ESTATE BRIEFS

Carlo Siracusa, regional vice president of Weichert, Realtors, announced that sales associate Joann Otteau of the Howell office was recognized for her exceptional industry success during the month of November. Otteau led the region, which is comprised of locations throughout Ocean and Monmouth counties, for resales. She can be reached in Weichert’s Howell office located at 626 Route 9 south, or call 732- 577-0440 for more information.

Carlo Siracusa, regional vice president of Weichert, Realtors, announced that the Marlboro office was recognized for exceptional performance in November. The office led the region, which is comprised of locations throughout Ocean and Monmouth counties, for new home dollar volume. Weichert’s Marlboro office is located at 455 Route 9 south in Manalapan, or call 732-536-4400 for more information.

Jack Waters, regional vice president of Weichert, Realtors, announced that the Old Bridge office was recognized for outstanding performance in November. The office led the region, which is comprised of locations throughout Middlesex County, in new home dollar volume, resale listings, resale revenue units and resale dollar volume. Additionally, sales associates John Horvath and Ranbir Singh of the Old Bridge office were recognized for their exceptional industry success. As top producers in November, Horvath led the region in resale revenue units and resale dollar volume, while Singh was recognized for new home dollar volume. They can be reached at Weichert’s Old Bridge office at 1394 Route 9 south, or call 732-525-1550 for more information.

Jack Waters, regional vice president of Weichert, Realtors, announced that sales associate Donna Warters of the East Brunswick office was recognized for her exceptional success during the month of November. Warters led the region, which is comprised of offices throughout Middlesex County, for resale listings. She can be reached in Weichert’s East Brunswick office at 431 Route 18 south, or call 732- 254-1700 for more information.

A dim view of the road ahead

Today’s automotive car headlamps don’t do an adequate job of illuminating poorly lit nighttime rural roads, which accounts for 40 percent of all miles driven in the United States.

That’s according to research conducted by AAA in Orlando, Fla. The organization found that halogen headlamps, currently included in more than 80 percent of new vehicles, may fail to safely light the way on otherwise unlit roadways at speeds as sedate as 40 mph. Specifically, they don’t allow a driver enough opportunity to detect an object, pedestrian or animal down the road, react and come to a complete stop in time to avoid a collision.

Not as widely available and usually offered at an extra cost, the AAA found LED and high-intensity headlamps to illuminate dark roadways 25 percent better than halogen lights, though they still fall short at speeds over 45 mph. Choosing the high beam setting on these types of headlamps offered significant improvement, however, stretching visibility to as much as 500 feet on otherwise dark roads.

— Jim Gorzelany
© CTW Features