Here's some free general information that I hope will be helpful to you!!!

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REMODELING VALUES

Certain remodeling projects will increase the livability and the marketability of a home. However, some projects will actually increase the value of the home and allow an owner to recapture the cost of the updating or additions.

The National Association of the Remodeling Industry offers a free brochure for consumers that suggests basic guidelines to help make planning a remodeling project easier. To receive a free copy of "Selecting a Professional Remodeling Contractor", write: NARI, 4301 N. Fairfax Drive #310, Arlington, VA 22203. Phone--1-800-966-7601.

The following chart is offered as a basic guide.

Remodeling Job		Average Job Cost		Average Resale Value		Cost
Minor kitchen remodel		$ 6,234		$ 6,551		104%
Bath addition		$10,550		$10,200		95%
Major kitchen remodel		$19,260		$18,200		94%
Bath remodel		$ 7,200		$ 6,190		85%
Family room addition		$28,450		$24,600		85%
Master bedroom suite		$22,600		$18,320		84%
Attic bedroom		$21,900		$17,700		81%
Deck addition		$ 5,730		$ 4,456		78%
Replace windows		$ 7,315		$ 5,289		73%
Sunroom addition		$24,920		$17,410		70%

HOME IMPROVEMENTS MAKE A DIFFERENCE

"Kitchens and bathrooms will date a home quicker than anything. And an updated kitchen with new appliances, counter top and attractive cabinets will make buyers get excited and can make the difference when deciding between homes..."

For example, a swimming pool or a built-in spa may not cause the home to sell for any additional money. In lower price ranges, it may even hurt the sale of the home. As the price goes up, more of the cost may be recovered but as a rough rule of thumb, you can generally only expect to get half of what the pool cost.

Other examples of items that don't increase the value include wool or other high quality carpet, oak panelling compared to ash panelling, solid brass plumbing fixtures, and slate or aluminum roofs. The logic is that the new buyer expects the quality to be good but will not usually pay for the top of the line.

On the other hand, there are some improvements which can cause the home to sell for more money and should be considered by homeowners, especially when updating is appropriate. Kitchens and bathrooms will date a home quicker than anything. An updated kitchen with new appliances, counter tops, and attractive cabinets will make buyers get excited and can make the difference when deciding between two homes. A tremendous change can be made in a bathroom by adding new light fixtures, new mirrors, and attractive wallpaper to complement the tile colors.

Don't expect a buyer to have the imagination to be able to see what your home will look like if they replace the carpet, paint, or add new wallpaper. Take the time and spend the money to make these improvements before you put your home on the market. It will sell quicker and for more money than if you give the buyer an "allowance".

ENERGY AUDIT INFORMATION

Should you add-on or move?? This is a question many people are faced with: Should we add-on to our existing home or should we sell our house and buy a new one? The questions can be perplexing, but with a little analysis, one can arrive at a logical solution.

There is a principle in real estate appraisal called conformity that says that all homes in a given area should be of similar size and value. If you add-on to your home, and in effect, over-build the neighborhood, the value of the smaller homes will bring your value down regardless of how much you have invested in the property.

Another difficulty that homeowners face when making an addition to their home is creating what appraisers call functional obsolescence. For example, if an additional family room or bedroom being built causes an unconventional floorplan, the new room could be functionally hampered and thereby affect value.

Contractors will advise people that an addition has to be of significant size to spread the cost of possible additional heating, air-conditioning, and foundation work. Many times a small room addition may cost as much as a larger one.

Certain room conversions can actually lessen the value of a property. For instance, converting a two car garage to a family room will usually penalize the value of a home and could hurt its marketability. People expect a home to have a garage and even though the additional living space is nice, it still needs the garage.

Once a home gets to a certain size in square footage, prospective buyers expect different types of amenities in the kitchens, bathrooms, and all throughout the home. Unless updating occurs at the same time the addition does, these things will be outdated.

Many times homeowners are better off selling their existing home and buying another home. However, if the homeowner should decide to make an addition, careful attention should be given to all the considerations mentioned above. Good third party advice can be invaluable.

One of the most neglected and overlooked areas of record keeping has to do with the capital improvements made to a person's principal residence. Part of the reason is that many people don't know what constitutes a capital improvement and another major part is not making enough effort.

The lack of effort comes from the fact that most homeowners know that as long as they buy a home more expensive than the one they're selling, the tax on the gain will be deferred. If it is deferred, then why make the effort?

The reason is that someday, you might not reinvest in another home or you may elect to take the once in a lifetime exemption, which in either case will trigger the calculation of gain. One of the single most important areas of reducing gain is to accurately record the capital gains made to a home during ownership.

Repairs on a principal residence are considered maintenance and are not treatable as expenses or capital improvements. These items would be routine maintenance on the property. However, capital improvements can be added to the basis or cost of the property, thereby reducing gain. There are three simple questions that can be asked to identify a capital improvement:

1) Does it materially add to the value of the residence? Examples might be the addition of a fireplace, new fixtures, a pool, or a spa.

2) Does it prolong the useful life of the residence? This applies to improvements that, if not done, would shorten the property's economic life, such as a new roof, exterior paint, or a new furnace.

3) Does it adapt a portion of the home to a new use? Converting a garage to a family room or finishing a basement or an attic would apply to this rule.

Capital improvements needn't be large-dollar items. Money spent on landscaping, deadbolts, ceiling fans, mini-blinds, and similar items are all improvements that apply.

A complimentary copy of the "Homeowner's Tax Worksheet", complete with instructions, is available on request. Just e-mail me at: ann@anncummings.com

"Why not use this technology to make a video record of all of the personal possessions in your home just in case you have a burglary or fire? If a picture is worth a thousand words, a video with sound has to be worth ten thousand..."

In recent years, the price of video cameras has come down so low that many households have one or two. Even if you haven't gotten around to buying one yet, you probably know someone who has one, or you can rent one for a very reasonable price. Most are very simple to operate and don't require any skilled training. The microphone is built into most of the cameras and some don't even require additional lighting.

Why not use this technology to make a video record of all of the personal possessions in your home just in case you have a burglary or fire? If a picture is worth a thousand words, a video with sound has to be worth ten thousand. Have someone help you with this simple project. One of you can man the camera and the other can identify different objects in each room. Describe each item as you go along, and if it has a serial number or other identifying mark, be sure to mention it.

Open all the closet doors to show what the contents are and briefly mention different things. You can't believe how helpful this can be after a loss because many times you don't miss something for months after a claim is filed because you might not use an item very often.

Once the videotape has been made, you might want to make a duplicate of it and put one copy either in a safety deposit box or give it to a friend or relative for safe keeping. Don't worry about being Steven Speilberg. You aren't trying to win an Oscar for this tape but just protect your possessions from loss. However, do have fun doing it.

If I can be of further assistance to you on any of these topics, please feel free to email me at ann@anncummings.com or contact me at: