DIY Do It Yourself

DIY
Do it Yourself projects may need permits (infographic from census.gov)

Home owners are spending more on home improvements.  “Do-it-Yourself” (DIY) projects are becoming popular again.  Besides being inspired by the increasing number of DIY home improvement shows on TV, there are numerous books, online sources and YouTube videos to show a DIYer how to take on almost any project in the home.  Being a DIY is ambitious and exciting, but for many becomes overwhelming and costly.

The notion of DIY is more than just being proud of getting your hands dirty.  For many home owners it’s really about money.  DIYers have a reputation for being thrifty, but a revealing research analysis asserts there’s more to it. Ryan H. Murphy (The Diseconomies of Do-It-Yourself; The Independent Review; Fall 2017; pp.245–255) provides ample evidence that many who engage in DIY have an anti-market bias.  Those who engage in DIY home improvements believe it is a zero or negative sum game, where there is no benefit from money spent on the home improvements.  He concludes that unless home improvement is your vocation, you’re better off sticking to your profession and hiring a (licensed) professional home improvement contractor.

One of the issues that is often noticed with DIY projects is that the result may be substandard.  The home owner may decide that although the project is not completed, it is “good enough” to save time and money.  Sometimes, the “good enough” attitude is evident by jerry-rigged components.  This can obviously be a problem when selling the home.  Home buyers have a keen eye and will be turned off by poor workmanship.  Even if the home buyer misses it, you can count on a home inspector to flag it.

Permits seem to be another issue for many DIYers. Some believe that obtaining a permit (when it’s required) is costly and time consuming.  However, inspectors are getting better at sniffing out unpermitted projects, so it is common for the DIYer to get caught before completing their improvements.

The permitting process may increase the time and cost for your DIY project, but it’s there to assure that buildings and home improvements adhere to the building and zoning codes within the city or county.  Building and zoning codes are devised to help ensure that buildings are safe.  Finishing a project without a required permit can potentially cost you more money and time down the road.

If you are required to get your unpermitted DIY project inspected after completion, don’t be surprised that you may have to make alterations and/ or corrections to your work.  If you built a structure that is deemed unsafe or even encroaches on a neighbor’s property, you may even have to demolish the project and start over.  You may even have to hire contractors to assist you.  If you are selling your home, the home buyer may require you to have your work inspected.  It can be even more costly if the project was completed during past code cycles, because, rather than send county inspectors, you may be required you to hire experts to inspect your work.

If you’re planning a DIY project and not sure if it needs a county or city permit, check with your municipality’s permitting office.  Here in Montgomery County MD, the Department of Permitting Services’ website lists additions and alterations that require permits (permittingservices.montgomerycountymd.gov).  However, if you live in one of Montgomery County’s county’s incorporated cities, your city may have different permitting requirements.

Copyright© Dan Krell
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Maintenance free homes

I talk about home maintenance quite a bit. And there is a reason. Maintaining your home is important, not just to keep you comfortable but to also preserve your investment. But many people loath the idea of spending their weekend checking their home’s systems, replacing air filters, mowing the yard, washing the siding, cleaning appliances, ad nauseum. They are called chores for a reason. But maybe sometime in the near future we will eliminate the chores and live in maintenance free homes.

Rapid technological advances are certainly making our lives easier. We can do many things in our homes, even when we’re not home! Our homes can even do things while we’re not home.  So how about increasing the quality of our lives by reducing the time spent maintaining our homes?

Maintenance free homes

maintenance free homes
Home Maintenance (infographic from sunlife.com)

Home design and materials tech are leading us to a home where maintenance is minimal or non-existent. Tech innovations has brought us new materials to enhance our homes’ appearance and decrease maintenance. Many of the new materials not only look good, but they are also green which makes our homes more efficient. Many material improvements have been primarily for your home’s exterior. For example, new no-maintenance or minimal maintenance materials for siding, decking and roofs are aesthetically pleasing and can last decades. However, low or no maintenance materials for your home’s interior are increasing in popularity too. Examples include quartz for counters, and prefinished wood for flooring.

The desire for maintenance free homes is not a new phenomenon and can be directly observed by housing choices. New home buyers like the idea that there will be minimal maintenance for the first year. They like feeling confident that everything in the home will work as expected without spending money on service calls, or expensive emergency repairs. Condo buyers like the idea of not having to deal with exterior home maintenance, especially lawn care. Additionally, active adult communities are designed with low maintenance in mind to make living easy and increase quality of life.

Unfortunately, because of their design, some mechanical systems still require care. For example, experts recommend that HVAC systems be serviced twice a year. The service not only checks and tunes the system to operate efficiently, it can identify potential hazards as well. However, to help keep maintenance at a minimum, many homeowners decide to sign up for a service contract. The service contract may also schedule the maintenance for you, which can also help you with time management. Not all service contracts are the same, and due diligence is recommended before you sign any agreement.

I am not dissing those homeowners who love to work on and around their homes. Don’t get me wrong, there is a satisfaction from doing chores and repairs. But there are many who don’t care for it. And not to mention that there are many homeowners who don’t maintain their homes, because of cost and/or inability. A major benefit to living in maintenance free homes is reducing the value-reducing effects of deferred maintenance.

Tech advances in home design and building materials have eliminated a great deal of the maintenance requirements that was necessary in the past. And although some systems in the home require regular care, newer systems increase in reliability. It’s fascinating that because of maintenance free exteriors many homeowners today don’t know what it’s like to paint the exterior of the house every two to three years. Likewise, maybe sometime in the near future, we won’t remember what it’s like changing air filters.

Copyright© Dan Krell
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Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Insurance claim after storm

insurance claim
Storm safety guide (infographic from ameriprise.com)

After enduring the recent twenty-four hours of near hurricane winds, many home owners are making repairs to their homes.  Many are reporting storm damage claims to their insurance companies.  Anyone who has made an insurance claim to repair their home knows that it can be ordeal.  But you can make the process easier if you know what to do.

When making an insurance claim, the Maryland Insurance Administration recommends that you contact your insurance agent or company immediately to report damage.  Prepare a detailed inventory of all damaged or destroyed property, to provide to the adjuster and for your records.  It is recommended that you take pictures or video of the damage for documentation and to help the insurance company’s investigation.  If emergency repairs are required, keep all receipts.  It’s important to only make necessary repairs, and to contact your insurance company before making permanent repairs.  You can view the Maryland Insurance Commissioner’s video on “Filing a Weather-Related Claim” for additional information and tips about your homeowners insurance (youtu.be/XywD4mdU1q8).

Before you make a claim, check with your insurance company about your deductible, policy coverage, and how they will pay-out the claim.  If total cost of the repair is approximately, or slightly more than, your deductible, making a claim may not be worth the trouble.  Your homeowners policy may also limit repairs to only the damaged areas, resulting in mismatched roof or siding.  If your mortgage company has to endorse the insurance check, contact the mortgage company to engage the process and expect a delay in reimbursement or contractor payment.

Making an insurance claim may also have consequences on your insurance premiums and future applications.  Much like credit reports that help creditors make decisions about extending credit, there are reports that provide the same to insurers.  These reports help underwrite insurance policies.  The “CLUE” report is a history of your insurance claims for the last seven years.  A CLUE report can exist for you personally, as well as your home.  Although the CLUE report has taken the public spotlight over the last decade, the A-PLUS property loss report is also popular with insurers.

Much like checking your credit report annually, the Maryland Insurance Administration recommends that you annually review your CLUE and A-PLUS reports.  The reports contain a detailed history of insurance claims for you and your property, as well as details about damage to your home.  Knowing what is contained in the reports may help you understand how an insurance company views your and your home’s insurance risk.  This can affect your insurance policy acceptance, limitations, and/or premiums.  And like credit reports, you can dispute any errors on the CLUE and A-PLUS reports.  The MIA website offers a list of contacts to help you obtain these reports (insurance.maryland.gov/Consumer/Pages/CreditandPropertyLossHistoryReports.aspx).

It’s not uncommon to hear from contractors after the storm (verify contractor license).

The MIA issued a consumer advisory regarding what contractors can and cannot do:

What contractors can do:
-Prepare an estimate of the loss.
-Discuss the estimate with their customer.
-Answer questions the insurance company has about the estimates.

What contractors cannot do, unless they are licensed as a public adjuster by the Maryland Insurance Administration:
-Investigate, appraise, evaluate, give advice or assist their customer in adjusting a claim.
-Prepare the insurance claim for their customer.
-Negotiate the claim with the insurance company on their customer’s behalf.
-Advise their customer on the insurance policy’s coverage.
-Advertise or provide written materials that they can negotiate or investigate a claim on their customer’s behalf.

If the hassle of filing a claim is too much for you, you might consider hiring a Public Adjuster.  The MIA describes the Public Adjuster as, “…an insurance claim adjuster who, for compensation, acts as an advocate for the policyholder in appraising and negotiating a first party property insurance claim under a property and casualty policy that insures the policyholder’s real or personal property…”  The Public Adjuster must be licensed by the MIA and enter into a contract with the policy holder, as well as provide disclosures.   Although a convenience, your insurance company is not obligated to accept the Public Adjuster’s claim.

The MIA states that a Public Adjuster must:

-be licensed by the Maryland Insurance Administration;
-prior to entering a contract with the policyholder, provide the policyholder with an explanation of the types of adjusters involved in the claims process and the insured’s rights to communicate directly with the insurer or its agents about settlement of the claims process and obtain the policyholder’s signature on the form;
-keep financial and business records and establish a separate escrow account for the policyholder’s proceeds.
-provide the policyholder with a written contract disclosing:

a.the terms of the contract;
b. the right to rescind or cancel the contract within 3 business days of signing;
c. that out-of-pocket expenses incurred by the Public Adjuster and approved by the insured will be reimbursed out of the insurance proceeds;
d. any compensation the Public Adjuster is to receive for services; and
e. the disclosure of any direct or indirect financial interest that the Public Adjuster or any immediate family member has with any other party who is involved in any aspect of the claim, including but not limited to the ownership of, or any compensation expected to be received from, any construction firm, salvage firm, building appraisal firm, motor vehicle repair shop, or any other firm that provides estimates for work or performs any work in conjunction with damages caused by the insured loss on which the public adjuster is engaged; and
f. the insured’s rights under the Maryland Consumer Protection Act.

 

Copyright© Dan Krell
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Keeping New Year’s home resolution

home resolution
New Year’s home resolution (infographic from lightstream.com)

Your home is an extension of your persona. The condition of your home impacts how you feel. So, what better way to start the new year than making a New Year’s home resolution to improving your living space?

There is disagreement about the need for and impact of New Year’s resolutions.  Many believe that making a conscious and purposeful declaration to better your life can get you on the right path.  However, many mental health professionals believe that making resolutions can be a set up for failure and disappointment if your expectations are too high.

Making a New Year’s home resolution can be achievable if you make it sensible  and meaningful.  Decide on the goal and make a plan detailing how you will accomplish it.  Ask yourself how the project will improve your life.  Sensory prompts, such as a picture of a clutter free family room or a carpet sample, can help you stay focused on the goal and keep you motivated.  You don’t have to go it alone either.  Consider hiring a professional.  If you decide to go the Do-It-Yourself route, make it a bonding opportunity by enlisting friends and/or family to assist you.

Whether you hire a professional or not, you need a plan on how you will actualize your home project.  It’s good to be ambitious with your New Year’s home resolution, but don’t fall into the trap deciding the project can be completed in one or two days.  Instead, be realistic.  After all, your daily routine is probably busy, if not hectic.  Decide on how much time you can realistically devote to the project, and put in on your calendar.

Whatever your New Year’s home resolution is, start with one room.  If need be, break the room down in sections to help organize where in the room you will begin and where to go next.  Collect and organize the materials you need for the project before you begin.  The greatest distraction from achieving your resolution is a trip to the store for extra supplies.

The most likely number one New Year’s resolution for the home is decluttering.  This makes sense because we all lead busy lives and collect stuff throughout the year.  But reducing the clutter in your home doesn’t only improve its appearance, it can also make you more comfortable.  Decluttering may also give a boost to your mental health.  Consider consulting with a professional organizer to help plan the project.

A home makeover is another popular New Year’s resolution project.  Fresh and new is always in.  Whether it’s painting a room or two, or installing new flooring, giving your home a new look can improve its appearance.  A new look can also affect how we feel.  Choose your color scheme carefully, because various colors elicit different responses.  For example, a blue-grays may seem relaxing, while reds are invigorating and exciting.

Catching up on deferred maintenance seems to be the New Year’s resolution that can get overwhelming.  Despite our best intentions, we all have put off some repair or regular upkeep at one time or another.  But repairs and maintenance are not static.  Meaning that over time, issues can get worse, and neglected systems can break down.  Instead of putting off repairs and maintenance, consider hiring a licensed contractor.

Copyright© Dan Krell
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Home remodeling to stay or sell

home remodeling
Home remodeling (infographic from census.gov)

The Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University predicts expanded growth of home remodeling and renovations through most of 2018.  That’s a good indication that the economy has picked up and the many homes that fell in disrepair after the Great recession are getting the much-needed attention to extend their functionality.

It wasn’t that long ago when Kermit Baker wrote about a crisis of the declining housing stock due to extensive deferred maintenance (The Return of Substandard Housing; housingperspectives.blogspot.com; February 27, 2013).  The article written for the Joint Center for Housing Studies of Harvard University highlighted the considerable reduction of home maintenance as measured by home owner “maintenance spending” during the Great Recession.  This seemed to be a low point for the country’s housing stock.  The 28 percent decrease in maintenance spending between 2007 and 2011 essentially nullified the renovation spending during the housing boom.

Home remodeling activity
Home remodeling activity Q3-2017 (graph from jchs.harvard.edu)

The Remodeling Futures Program releases a quarterly data for Leading Indicator of Remodeling Activity (LIRA). The LIRA is a “a short-term outlook of national home improvement and repair spending to owner-occupied homes.”  The most recent data indicates that home remodeling and repair spending will escalate from the fourth quarter of 2017 into the third quarter of 2018, estimating an increase from 6.3 percent to 7.7 percent.  The significant increase in home improvement spending is attributed to a strengthening economy, home equity gains, and low home re-sale inventory.  Chris Herbert, Managing Director of the Joint Center for Housing Studies is optimistic about maintenance spending.  Herbert said:

“Recent strengthening of the US economy, tight for-sale housing inventories, and healthy home equity gains are all working to boost home improvement activity…Over the coming year, owners are projected to spend in excess of $330 billion on home upgrades and replacements, as well as routine maintenance.

The current LIRA data doesn’t include the effects of recent hurricanes.  It is expected that those recent disasters will significantly increase the anticipated projected maintenance spending.

Home owners really have no choice but to spend on renovations, remodeling and repairs, especially if they are planning on selling their home.  Most home buyers want a turnkey home, where the home is fresh and new and offers minimal maintenance during the first year of ownership.  The desire for a turnkey home is probably why new home sales are at a ten-year high.  This week, the US Census Bureau (census.gov) released new home sale data that indicates a month-over-month increase of 6.2 percent, and a year-over-year increase of 18.7 percent!  To compete with other re-sales and new homes, home sellers must factor in the cost of home renovations.

There are many home owners who still can’t afford to move.  The fact that many are still priced out of the move-up market has been a major issue holding back the housing market.  This phenomenon is also responsible for continued low home re-sale inventories.  As a result, many home owners are staying in their homes much longer than anticipated.  The National Association of Realtors indicated in the Home Buyer and Seller Generational Trends Report 2017 (nar.realtor) that home buyers anticipate staying in a home about twelve years.  This is an increase of about five years compared to a decade ago.

Although many home owners still can’t move, they are deciding to do home “make overs.”  The make overs will give their homes a fresh look, that typically include new floors and paint schemes.  Additionally, kitchen and bathroom renovations modernize the home.  However, home owners needing more room, are opting to expand their homes to give them larger spaces.  Some home owners are going beyond the basics and creating different spaces by moving walls.

Regardless of your reasons for home renovations and repairs, home improvement experts recommend to create a budget and stick to it, and always hire licensed contractors.

Copyright© Dan Krell
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.