Drop Ceilings: Pros and Cons

Humans have long had a love/hate relationship with ceilings. On one hand, they help to hide the structure that keeps the rain out; on the other, they can be a pain to install and maintain over time. So when the idea of the drop ceiling started gaining momentum, it followed that two very die-hard camps formed almost immediately. But drop ceilings have changed dramatically since the first patents were introduced in 1919 and subsequent improvements made in the 30s and 50s. Today’s drop ceiling, while building on these same principles, is a very different creature.

Drop Ceilings Aren’t Just for Offices

Most people get their first exposure to drop ceilings in their office or schools, where two foot by four foot styrofoam rectangles are set in a grid, along with harsh fluorescent lights, in place of a more traditional plastered or drywalled ceiling. Because these drop ceilings can be very severe in appearance, the very phrase has become suspect. But there are other drop ceilings that aren’t quite so industrial, and can actually really add to your home’s design and unique interior space. These may mimic stamped tin ceilings, coffered ceilings, or a number of different kinds of decorative wood patterns like beadboard. You may not even recognize a modern drop ceiling simply from looking at it, and that’s really the point.

Pros and Cons of Drop Ceilings

Looks aside, drop ceilings are not for everyone. They aren’t even for every kind of space, contrary to what some people may believe. It also really depends on the installation style you’re working with whether or not a drop ceiling in question is going to be the best choice for your home. But in general you can expect the following truths about drop ceilings.

• They’re simple to install. Drop ceilings are popular with a lot of DIYers because they’re easy to install and don’t require expert drywall skills to get a good result. Unlike drywall, which must be hung, the joints sealed, sanded, primered, painted, and painted again, a drop ceiling comes as a kit and is put together much more like flat-packed furniture. Follow the instructions and you should have the ceiling you expect.
• Maintenance is minimal. Drywall and plaster crack, it’s a fact. It’s also a reason a lot of older homes have newer drop ceilings installed over the originals. Regular patching of ceilings as a home ages and shifts ever so slightly is a headache. Styrofoam ceiling panels have much more give and can flex as a house moves. Bonus points for areas like basements where wood may shrink and swell throughout the year.
• They provide small amounts of insulation. Depending on how a drop ceiling is hung and what type you choose, you can expect a very small amount of insulation gain from them, as well as noise dampening. They’ve been used in homes with tall ceilings successfully to lower the heated envelope of the home from 10 feet to a more energy efficient seven to eight feet across the country, but by doing this, you can also interfere with the way the home’s air exchange was designed to work. Take caution when dropping ceilings dramatically.
• Head space is reduced. Even when you’re using a drop ceiling in a very minimalistic way, there’s going to be loss of headroom. This is because drop ceilings generally have to be hung on special brackets or dropped within a hanging framework. You may not lose a lot of headspace, possibly only inches, but in areas like basements where inches can be too much loss, it’s a serious consideration.
• Lighting solutions can be tricky. You’ll need to plan your lighting carefully when installing a drop ceiling. Because of the gap that tends to be present, even if it’s just a few inches worth, mounting lighting can require a great deal of planning and care. You may have to use special supports or choose different lighting types when you change a ceiling to a drop ceiling, or carefully design lighting if adding a drop ceiling to an area that’s never had a ceiling in it before.

Having Trouble Deciding?

If you don’t know what way to go with your future ceiling, you don’t have to go it alone. Just look in HomeKeepr for a recommendation for ceiling and interior design experts in your area. They can walk through your home with you, and help you choose the best option for your house, your budget, and your lifestyle.

Is It a Good Time to Sell My House?

Last year, many homeowners thought twice about selling their houses due to the onset of the health crisis. This year, however, homeowners are beginning to regain their confidence when it comes to selling safely. The latest Home Purchase Sentiment Index (HPSI) by Fannie Mae shows that 57% of consumers believe now is a good time to sell.

Doug Duncan, Vice President and Chief Economist at Fannie Mae, explains:

Overall, the indexes monthly increase was driven largely by a substantial jump in the share of consumers reporting that its a good time to sell a home, with many citing favorable mortgage rates, high home prices, and low housing inventory as their primary rationale.

Normally, spring is the busiest season in the housing market the time when many homeowners decide to list their houses. While this is obviously not a normal year since the pandemic is still very much upon us, experts are optimistic that consumer positivity around selling will lead to more homeowners making moves this year. Duncan continues to say:

We will pay close attention to see if this newfound optimism develops into a trend.

What does this mean if you're thinking of selling your house?

The fact that there are so few houses available for sale today is one driver that's encouraging consumers to think more positively about selling. The National Association of Realtors (NAR) states:

“Total housing inventory at the end of January amounted to 1.04 million units, down 1.9% from December and down 25.7% from one year ago (1.40 million).

With so few homes available to buy, your house will be more likely to rise to the top of an eager purchasers wish list in this competitive market. Todays high buyer activity is creating upward pressure on home prices and more multiple-offer scenarios. According to the Realtors Confidence Index Survey from NAR, the average home for sale is receiving 3.7 offers today, up from 2.3 offers just one year ago. This makes selling even more enticing.

In this kind of sellers market, you have a huge advantage in the process. And here's another win you can also use your equity toward a down payment on a new home when you move.

Wondering where you'll go if you try to move while its so challenging to find a home to buy? Well, in many areas, there are more homes available at the higher end of the market, so finding a move-up home may be less of an issue if you're ready to search for your dream home this spring.

Bottom Line

If you pressed pause on selling your house last year, now may be the best time to put your plans back into motion while inventory is so low. Lets connect today to get the process started.

Where Have All the Houses Gone?

Where Have All the Houses Gone?

In todays housing market, it seems harder than ever to find a home to buy. Before the health crisis hit us a year ago, there was already a shortage of homes for sale. When many homeowners delayed their plans to sell at the same time that more buyers aimed to take advantage of record-low mortgage rates and purchase a home, housing inventory dropped even further. Experts consider this to be the biggest challenge facing an otherwise hot market while buyers continue to compete for homes. As Danielle Hale, Chief Economist at realtor.com, explains:

With buyers active in the market and seller participation lagging, homes are selling quickly and the total number available for sale at any point in time continues to drop lower. In January as a whole, the number of for sale homes dropped below 600,000.

Every month, realtor.com releases new data showing the year-over-year change in inventory of existing homes for sale. As you can see in the map below, nationwide, inventory is 42.6% lower than it was at this time last year:

Does this mean houses arent being put on the market for sale?

Not exactly. While there are fewer existing homes being listed right now, many homes are simply selling faster than they're being counted as current inventory. The market is that competitive! Its like when everyone was trying to find toilet paper to buy last spring and it was flying off the shelves faster than it could be stocked in the stores. That's what's happening in the housing market: homes are being listed for sale, but not at a rate that can keep up with heavy demand from competitive buyers.

In the same realtor.com report, Hale explains:

Time on the market was 10 days faster than last year meaning that buyers still have to make decisions quickly in order to be successful. Todays buyers have many tools to help them do that, including the ability to be notified as soon as homes meeting their search criteria hit the market. By tailoring search and notifications to the homes that are a solid match, buyers can act quickly and compete successfully in this faster-paced housing market.

The Good News for Homeowners

The health crisis has been a major reason why potential sellers have held off this long, but as vaccines become more widely available, homeowners will start making their moves. Ali Wolf, Chief Economist at Zonda, confirms:

Some people will feel comfortable listing their home during the first half of 2021. Others will want to wait until the vaccines are widely distributed.

With more homeowners getting ready to sell later this year, putting your house on the market sooner rather than later is the best way to make sure your listing shines brighter than the rest.

When you're ready to sell your house, you'll likely want it to sell as quickly as possible, for the best price, and with little to no hassle. If you're looking for these selling conditions, you'll find them in todays market. When demand is high and inventory is low, sellers have the ability to create optimal terms and timelines for the sale, making now an exceptional time to move.

Bottom Line

Todays housing market is a big win for sellers, but these conditions wont last forever. If you're in a position to sell your house now, you may not want to wait for your neighbors to do the same. Lets connect to discuss how to sell your house safely so you're able to benefit from todays high demand and low inventory.

The Reason Mortgage Rates Are Projected to Increase and What It Means for You

The Reason Mortgage Rates Are Projected to Increase and What It Means for You

Were currently experiencing historically low mortgage rates. Over the last fifty years, the average on a Freddie Mac 30-year fixed-rate mortgage has been 7.76%. Today, that rate is 2.81%. Flocks of homebuyers have been taking advantage of these remarkably low rates over the last twelve months. However, there's no guarantee rates will remain this low much longer.

Whenever we try to forecast mortgage rates, we should consider the advice of Mark Fleming, Chief Economist at First American:

You know, the fallacy of economic forecasting is don’t ever try and forecast interest rates and/or, more specifically, if you’re a real estate economist mortgage rates, because you will always invariably be wrong.

Many things impact mortgage rates. The economy, inflation, and Fed policy, just to name a few. That makes forecasting rates difficult. However, there's one metric that has held up over the last fifty years the relationship between mortgage rates and the 10-year treasury rate. Here's a graph detailing this relationship since Freddie Mac started keeping mortgage rate records in 1972:There's no denying the close relationship between the two. Over the last five decades, there's been an average 1.7-point spread between these two rates. Its this long-term relationship that has some forecasters projecting an increase in mortgage rates as we move throughout the year. This is based on the recent surge in the 10-year treasury rate shown here:The spread between the two is now 1.53, indicating mortgage rates could rise. Actually, a bump-up in rate has already begun. As Joel Kan, Associate VP of Economic Forecasting for the Mortgage Bankers Association, reveals:

Expectations of faster economic growth and inflation continue to push Treasury yields & mortgage rates higher. Since hitting a survey low in December, the 30-year fixed rate has slowly risen, & last week climbed to its highest level since Nov 2020.

How high might they go in 2021?

No one knows for sure. Sam Khater, Chief Economist for Freddie Mac, recently suggested:

While there are multiple temporary factors driving up rates, the underlying economic fundamentals point to rates remaining in the low 3% range for the year.

What does this mean for you?

Whether you're a first-time buyer or you've purchased a home before, even an increase of half a point in mortgage rate (2.81 to 3.31%) makes a big difference. On a $300,000 mortgage, that difference (including principal and interest) is $82 a month, $984 a year, or a total of $29,520 over the life of the home loan.

Bottom Line

Based on the 50-year symbiotic relationship between treasury rates and mortgage rates, it appears mortgage rates could be headed up this year. It may make sense to buy now rather than wait.

 

Sliding Barn Doors for Beginners

The cottage look has become a huge trend for homeowners, especially those with older homes that have lost a lot of their original charm to generic remodels over generations. One of the big elements of this new wave in design is the sliding barn door, a simple door mounted on a track that slides to cover a doorway. It’s not a fancy invention, nor is it a new one, so why are they getting so much attention all of a sudden?

The Sliding Barn Door Aesthetic

Sliding barn doors add a ton of cottage chic to a home, especially one that’s already boasting pre-modern features like custom hand-built kitchen cabinetry, built-in storage, and unusual spaces. The sliding barn door is a simple but elegant touch. It’s literally just a door built from wooden slats, just like you’d see on an old-fashioned barn on a farm. That rugged, simple look complements a lot of different styles, especially considering the many different kinds of materials that can be used to achieve the final result.

Considerations Before Installing Sliding Barn Doors

There are many things to consider before you choose sliding barn doors for your home. The first, and most important, is whether or not a barn door actually makes sense with the rest of your design. If you’re literally choosing a barn door because they’re trending right now, that’s about the worst possible reason to make the call. Instead, ask yourself if you really like the cottage chic look, and if you do, if it makes sense with the other design choices you’re making in your home. Although some purists may argue that there’s absolutely no place for a cottage look in a modern home, most designers would agree that the most important thing is consistency. After all, a lot of homes built in the last 40 or so years don’t really have a strong aesthetic of their own, which leaves a lot of room for creative minds to wander.

If you do decide you want to go with a barn door, and it’s consistent with the styling of your home, keep these additional things in mind while choosing the door and where it will be installed:

• Barn doors don’t insulate well. Because barn doors hang on a sliding track, rather than sealing shut, there’s more air, light, and sound infiltration around them. This is fine for a lot of uses, but may make them a poor choice for spaces like bedrooms or bathrooms where you’d like more privacy. If you have pets, for safety’s sake, choose a door and hardware that are heavy enough to keep the bottom of the door from being shoved forward to allow a smart dog or cat to open these doors from the bottom.
• They do save a ton of space. Even though they’re not the greatest doors for insulation, barn doors can save a ton of space that a regular door will require to swing. Instead of losing a whole wall to opening a door, you can instead move the furniture a few inches off the wall to allow the barn door to slide behind. Unlike pocket doors, you don’t need to tear out a wall to install a barn door; you simply run along the outer wall. This can also help minimize the impact of doors that cover water closets and pantries.
• Planning is important. Before you decide that you absolutely must have a barn door, look very carefully at the space where you think it should go. Remember, the door will need room to move along a track, so there must be room on both sides of the door opening (at least enough to allow for the hardware), and no elements that stick out of the wall. If you’ve got a flat light switch or outlet that will end up under the door, consider how that will affect your ability to use the electricity in the room.

Ready for That New Barn Door?

Whether you’ve decided that a barn door is absolutely a necessity in your home, or you simply want a second opinion before you dive in, your HomeKeepr community has the experts to help steer you right. Whether you need an interior designer or a general contractor, HomeKeepr can help you find the barn door experts you need.

How Much Leverage Do Todays House Sellers Have?

How Much Leverage Do Todays House Sellers Have?

The housing market has been scorching hot over the last twelve months. Buyers and their high demand have far outnumbered sellers and a short supply of houses. According to the latest Existing Home Sales Report from the National Association of Realtors (NAR), sales are up 23.7% from the same time last year while the inventory of homes available for sale is down 25.7%. There are 360,000 fewer single-family homes for sale today than there were at this time last year. This increase in demand coupled with such limited supply is leading to more bidding wars throughout the country.

Rose Quint, Assistant Vice President for Survey Research with the National Association of Home Builders (NAHB), recently reported:

The number one reason long-time searchers haven't made a home purchase is not because of their inability to find an affordably-priced home, but because they continue to get outbid by other offers.

A survey in the NAHB report showed that 40% of buyers have been outbid for a home they wanted to purchase. This is more than twice the percentage in 2019, which was 19%.

What does this mean for sellers today?

It means sellers have tremendous leverage when negotiating with buyers.

In negotiations, leverage is the power that one side may have to influence the other side while moving closer to their negotiating position. A party’s leverage is based on its ability to award benefits or eliminate costs on the other side.

In todays market, a buyer wants three things:

1. To buy a home
2. To buy now before prices continue to appreciate
3. To buy now and take advantage of historically low mortgage rates while they last

These three buyer needs give the homeowner tremendous leverage when selling their house. Most realize this leverage enables the seller to sell at a good price. However, there may be another need the seller has that can be satisfied by using this leverage.

Here's an example:

Odeta Kushi, Deputy Chief Economist at First American, recently identified a situation in which many sellers are finding themselves today:

As mortgage rates are expected to remain near 3%, millennials continue to form households and more existing homeowners tap their equity for the purchase of a better home Many homeowners may want to upgrade, but do not for fear that they will be unable to find a home to buy.

She then offers a possible solution:

While the fear of not being able to find something to buy will not disappear in a limited supply environment, new housing supply can incentivize existing homeowners to move.

There's no doubt many sellers would love to build a new home to perfectly fit their changing wants and needs. However, most builders require that they sell their house first. If the seller sells their home, where would they live while their new home is being constructed?

Going back to the concept of leverage:

As mentioned, buyers have compelling reasons to purchase a home now, and many homeowners have challenges to address if they want to sell. Perhaps they can make a deal to satisfy each parties needs. But how?

The seller may decide to sell their home to the buyer at todays price, which will enable the purchaser to take advantage of current mortgage rates. In return, the buyer might lease the house back to the seller for a pre-determined length of time while the sellers new home is being built. A true win-win negotiation.

Not every buyer will agree to such a deal but you only need one.

That's just one example of how a seller might be able to overcome a challenge because of the leverage they have in todays market. Maybe you feel a need to make certain repairs before selling. Perhaps you need time to get permits or approvals for certain upgrades you made to the house. Whatever the challenge, you may be able to work it out.

Bottom Line

If you're considering selling your house now but worry a huge obstacle stands in your way, let’s connect. Maybe with the leverage you currently have, you can negotiate a deal that will allow you to make the move of your dreams.

 

Are There Going to Be More Homes to Buy This Year?

 Are There Going to Be More Homes to Buy This Year?

If you're looking for a home to purchase right now and having trouble finding one, you're not alone. At a time like this when there are so few houses for sale, its normal to wonder if you'll actually find one to buy. According to the National Association of Realtors (NAR), across the country, inventory of available homes for sale is at an all-time low the lowest point recorded since NAR began tracking this metric in 1982. There are, however, more homes expected to hit the market later this year. Lets break down the three key places they'll likely come from as 2021 continues on.

1. Homeowners Who Didn't Sell Last Year

In 2020, many sellers decided to pause their moving plans for a number of different reasons. From health concerns about the pandemic to financial uncertainty, plenty of homeowners decided not to move last year.

Now that vaccines are being distributed and there's a light at the end of the COVID-19 tunnel, it should bring some peace of mind to many potential sellers. As Danielle Hale, Chief Economist at realtor.com, notes:

Fortunately for would-be homebuyers, we expect sellers to return to the market as we see improvement in the economy and progress against the coronavirus.

Many of the homeowners who decided not to sell in 2020 will enter the market later this year as they begin to feel more comfortable showing their house in person, understanding their financial situation, and simply having more security in life.

2. More New Homes Will Be Built

Last year was a strong year for home builders, and according to the National Association of Home Builders (NAHB), 2021 is expected to be even better:

For 2021, NAHB expects ongoing growth for single-family construction. It will be the first year for which total single-family construction will exceed 1 million starts since the Great Recession.

With more houses being built in many markets around the country, homeowners looking for new houses that meet their changing needs will be able to move into their dream homes. When they sell their current houses, this will create opportunities for those looking to find a home that's already built to do so. It sets a simple chain reaction in motion for hopeful buyers.

3. Those Impacted Financially by the Economic Crisis

Many experts don't anticipate a large wave of foreclosures coming to the market, given the forbearance options afforded to current homeowners throughout the pandemic. Some homeowners who have been impacted economically will, however, need to move this year. There are also homeowners who didn't take advantage of the forbearance option or were already in a foreclosure situation before the pandemic began. In those cases, homeowners may decide to sell their houses instead of going into the foreclosure process, especially given the equity in homes today. Lawrence Yun, Chief Economist at NAR, explains:

Given the huge price gains recently, I don’t think many homes will have to go to foreclosure I think homes will just be sold, and there will be cash left over for the seller, even in a distressed situation. So that’s a bit of a silver lining in that we don’t expect a massive sale of distressed properties.

As we can see, it looks like were going to have an increase in the number of homes for sale in 2021. With fears of the pandemic starting to ease, new homes being built, and more listings coming to the market prior to foreclosure, there's hope if you're planning to buy this year. And if you're thinking of selling and making a move, doing so while demand for your house is high might create an outstanding move-up option for you.

Bottom Line

Housing demand is high and supply is low, so if you're thinking of moving, its a great time to do so. There are likely many buyers who are looking for a home just like yours, and there are options coming for you to find a new house too. Lets connect today to see how you can benefit from the opportunities available in our local market.