Santa Fe Real Estate Scene
June 2006

Thinking about a summer home-remodeling project?

When you look at the cost of replacing your house, remodeling your current home may be an attractive choice. According to the National Association of Realtors, U.S. homes have appreciated 6.8% annually on average since 1968, compared with inflation during the same period at an annual clip of 5.1%. In addition, the American Homeowner's Foundation estimates that it can cost up to 10% of a house's value to replace it with another, even one that costs exactly the same. Selling one $200,000 house and buying another of similar value could set you back as much as $20,000. So, when looking both at home appreciations and the cost of moving, it may make sense to stay put.

An estimated 1 million homeowners per year undertake a remodeling project, boosting what was a $230 billion industry in 2005 even higher. The decision of whether to sell a house, or stay and remodel, is one that is based on many factors, including what type of changes you want to make, how long you plan to stay in the house and the cost of the remodeling in comparison to the value of your home.

Experts say there are at least two rules of thumb when it comes to remodeling your house. First, you should not increase the value of your house to a point where it is the most expensive home in your neighborhood. This could make it difficult to sell the house in a competitive housing market. Second, you should strive to keep your new mortgage debt below 80% of your home's new appraised value. Not only does this keep you below the debt/equity ratio requiring you to pay private mortgage insurance on the new loan, but it also ensures you don't assume a monthly payment that precludes you from having a balanced household budget.

Best Improvements for Your Dollar According to Remodeling Magazine, the top five remodeling projects in 2005, ranked in the order of percent of cost recouped at home resale, included minor kitchen remodel (92.9% of cost recouped), siding replacement (92.8%), midrange bathroom remodel (90.1%), deck addition (86.7%), and midrange bathroom addition (86.4%).

The exact figures can vary greatly based on the housing market in your area. When housing prices are rising rapidly, remodeling costs can be recouped faster. In addition, if your remodel simply catches your house up to the others in your neighborhood, the improvement could actually recoup more than the cost.

The question of how much to spend on remodeling could also depend on whether the changes could be categorized as maintenance or remodeling. Maintenance improvements would be things like replacing the roof, carpet, or repainting. In addition, maintenance projects that focus on energy efficiency may have an even quicker payback than standard remodeling. Replacing windows, adding insulation and upgrading to more-efficient air and heating units are good examples.

It may also be important to consider how much enjoyment you will get out of the improvement. A home office, pool or gazebo may enhance your family's quality of life, but experts say these are examples of remodeling projects that rarely give anywhere close to 100% payback at resale.

Finally, make sure that your own homeowner's insurance is raised to include the value of the newly remodeled house as the work is completed. By sticking to these suggestions, you will be enjoying your new remodeling job both now and for many years to come.

This article provide courtesy of

Charles Watkins
The Watkins Group
Phone - Office: 505.989.9900
charles@watkinsgroup.biz
Website: http://watkinsgroup.biz

"Create Wealth Through Santa Fe Real Estate"

For Advice, call Broker Atwell at 866-264-4848 or 505-670-2177.

Buyer Tips

7 Habits of Successful Investors

1. Save and invest 15% pretax income
2. Buy and Hold. Power of Compounding
3. Utilize Professionals – Realtor, Attorney, Accountant, Title
4. Asset allocation, diversify – cash, stocks, bonds, credit line, real estate, insurance
5. Systematic and unemotional accumulation
6. Expert Team gives you unbiased and objective advice
7. Align reinvestment with growth trends

3 Major Tax Deductions

1. Own your business, Schedule C or K-1
2. Real Estate and depreciation
3. Oil and Gas

Habits of Successful Real Estate Investors

• Finance for 15 years
• Place 20% or more down on your loan
• Invest and Hold
• Invest consistently
• Buy newer properties
• Focus on investment strategy
• Research and know your marketplace
• Hire an experienced Realtor to save time and money
• Utilize property management company for consistent income
• Maintain great records
• Depreciate your properties
• File and Pay your taxes strategically
• Plan and setup estates and LLC with your attorney and accountant

"Create Wealth Through Santa Fe Real Estate"

For Advice, call Broker Atwell at 866-264-4848 or 505-670-2177.

Seller Tips

• Free Home Market Analysis, call 1-866-264-4848
• Strategic Internet Presence
• Proven Marketing Campaigns
• Consistent and Responsive Communication
• Pricing and Negotiation Strategies

"Create Wealth Through Santa Fe Real Estate"

For Advice, call Broker Atwell at 866-264-4848 or 505-670-2177.

See Seller Tips http://www.santafeone.com/articles/sellers.html

Statistics

Existing and new single family detached home sales:

City of Santa Fe

Northeast
Northeast
34 sold, median price $717,500
Northwest
12 sold, median price $430,562
Southeast
39 sold, median price $582,000
Southwest
132 sold, median price $271,857
Total City of Santa Fe
217 sold, median price $308,000

Santa Fe County

North
14 sold, median price $570,000
Northwest
38 sold, median price $697,625
Southeast
81 sold, median price $460,000
Eldorado
44 sold, median price $370,000
Southwest
61 sold, median price $340,000
Total Santa Fe County
194 sold, median price $449,750

Total City of Santa Fe/Santa Fe County
411 sold, median price $375,140

Condo/Townhome  City and County
174 sold, median price $297,250
Duplex, Xplex  City and County
9 sold, median price $165,000
Mobile/Manufactured City and County
17 sold, $153,000

Note: The City of Santa Fe and Santa Fe County offer homes and land for all levels of buyers and sellers.

Note: This representation is based in whole or in part on data supplied by the Santa Fe Association of Realtors or its Multiple Listing Service. Neither the Association nor its MLS guarantees or is any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the market.

Finance

New Mexico Mortgage Brokers
Call or email today for your free financial pre-qualification.

Gary Miller, Citivest Mortgage
1-877-982-9530 toll free, garym@hubwest.com

Marcela Lopez, Delta Mortgage, 505-920-2344

Chuck Watkins, The Watkins Group,
505-989-9900,
charles@watkinsgroup.biz

Whitney Smith, Wells Fargo Home Mortgage,
505-319-1908,
whit.smith@wellsfargo.com

Interest rates, See www.Bankrate.com

Jobs in Santa Fe

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Also:
http://www.santafehasjobs.com/
http://newmexicojobs.com/

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Kokopelli Realty services: City of Santa Fe, and the following counties: Santa Fe County, Rio Arriba County, Mora County. Other cities and towns include: Santa Fe, Los Alamos, Espanola, Abiquiu, Medanales, Alcalde, Dixon, Pojoaque, Tesuque, Las Campanas, Nambe, Chimayo, El Dorado, Glorietta, Pecos, Hwy 285, Galisteo, Lamy, Hwy 14, Cerrillos, Madrid, Rio Chama, Rio Grande, Pecos River and more!