Private Residential Construction Spending Up

The NAHB analysis of Census Construction Spending reported a 1.1 increase in total private residential construction spending in December 2021. November 2021 also reported an increase of 0.7%, in fact, total private residential construction spending was 15% higher than reported at the same time last year. Spending was reported at a seasonally adjusted annual rate of $810.3 billion.

The growth rates are due to the solid growth of spending on single-family and multifamily construction. Monthly gains in single-family construction rose 2.1% to a $435 billion annual pace in December 2021. As for multifamily construction, there was a 0.4% increase in December 2021. Spending was a little down because of the supply chain issues and labor shortages.

Private nonresidential construction spending stayed steady during December 2021. The data shows that the spending was 9.1% higher than a year ago. As far as the separate spending in each category was $0.49 billion in office, $0.4 billion in amusement and recreation and $0.37 billion in lodging.

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Five Financial Obligations Every Homeowner Should Know

Buying a home can be both stressful and exciting. Homeownership is an important life event, especially for first-time homebuyers. Understanding these five financial obligations can help your journey be less stressful.

1. Don’t be fooled by your mortgage pre-approval amount

Getting a pre-approval is the first step on the journey of owning a home. A pre-approval letter from a mortgage lender does not mean you have it in the bank so to speak. A mortgage pre-approval is only just assurance from a lender that the buyer is in good financial standing to take on a mortgage of a certain size.  Just because you are pre-approved for a certain amount, doesn't mean you can afford it. Your pre-approval does not equal your actual budget. For example, even though you are approved for $300,000 doesn't mean you can pay the payments for a $300,000 mortgage.

2. Closing costs can add up—and be complicated

Closing costs are out-of-pocket expenses which include title insurance, notary fees, and the cost of the deed. Buyers can ask for sellers to pay closing costs but it is not to their advantage in the current seller's market.

“Some loan programs only allow a certain percentage of the sale price to be given to the buyer as a credit,” says Joe DiRosa, a real estate agent with RealtyTopia in Pennsylvania.

That means that if you’re offering $200,000 for a house and your lender only allows you to accept 2% in closing costs, you shouldn’t ask for $5,000—that would be $1,000 down the drain since you can only accept up to $4,000 in credit. Before you make an offer, ask your lender if your loan institutes a limit on closing cost credits.

3. PMI isn’t actually the devil

PMI stands for private mortgage insurance and has been characterized as both a blessing and a curse. PMI is a safety net for mortgage lenders when homebuyers do not put 20% down. It covers the lenders if the homebuyers default on their mortgage. The PMI is an additional payment on your mortgage payment. Unlike your principal, PMI does not add to your equity. Once a homeowner does have 20% equity, you can ask to have the PMI removed.

4. You might have to make escrow payments

Escrow simply refers to the separate account where that money is held; basically, our lender sets aside the money for taxes and insurance, which acts as a safety net to ensure that we sock away enough money for those expenses.  So when you have a loan with PMI, you have to pay money into an escrow for property taxes and home insurance.

5. You need to budget for surprises (and your own mistakes)

There will definitely be unexpected expenses in homeownership. Even if you depend on your clean report from the home inspector, something could come up the next day. A home inspector gives the dishwasher an A+ but the next week after you move in and go to wash the dishes it won't start.

Homeownership is a great investment, but you have to plan ahead. A local Realtor can help you navigate and find your perfect dream home.

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Tips For A Kitchen Make-Over

 The kitchen is the heart of the home and a kitchen renovation should be planned out and budgeted to make sure it fits your wants and needs. Make sure to think about resale value when renovating. When it comes to selling a home, the kitchen is one of the most important spaces that a buyer looks over. Here are some questions and tips to consider when renovating your kitchen.

How to plan a kitchen renovation?

Remember both a small or large kitchen remodel takes thought and planning. A bad remodel can make you unhappy and a hard sell when it comes to listing your home. One of the most important aspects of any home project is the budget.

You want to plan your projected kitchen renovation cost. A small remodel costs around $10,000 to $15,000 where a big renovation can cost over $30,000. Make sure to survey your neighborhood's resale values. If you are in a high-end neighborhood, you should have a higher investment cost for your kitchen remodel.

When you have the total renovation budget, you will need to break down your budget. Breaking down your budget can give you a clearer picture. Add a little cushion to your costs. Professional agree that around 10% - 20% on top of your total renovation budget should be sufficient. There can be an increase in the cost of materials, labor, or extra expenditures.

If you are stained for finances or have a certain about you can borrow, you might want to create a priority list of what must be done and what can be skipped for now. If you have a smaller budget, try to get hands-on and do some of the labor yourself. Examples of projects that can be easy for a homeowner taking out old doors of your cabinets, securing your appliances, and repainting. As a side note, obtaining a loan to renovate your kitchen is tax-deductible.

How to update your kitchen on a budget?

Remember you can give your kitchen a nice facelift even if you have a smaller budget. Refacing or refinishing your kitchen drawers and cabinets can save some money. If your kitchen cabinets are in good shape, then re-painting and adding new hardware can them can give them a whole new look. Adding wood veneer to the drawers can also give a new design to the kitchen. If your cabinet doors are in bad shape you can also just add new doors to the existing cabinets.

Another way to save money is by purchasing discounted countertops. Countertops in your kitchen are a big focal point. Granite and quartz slabs can be expensive but purchasing countertop remnants can save money. If you cannot find any remnants that fit your project, then use porcelain, ceramic, recycled glass, Formica, or butcher blocks.

Lighting can be another alternative to help with your budget. Installing LED lighting can make a huge impact. To do this, install LEDs under your cabinets and countertops. LED lighting around the kitchen will create a modern and sleek look on a budget.

Laminate floor tiles with older designs are a great way to save on your budget. Other options are using vinyl, porcelain, and ceramic tiles for your new kitchen floor. Make sure your floors complement your walls and ceiling.

How long to redo a kitchen?

The time frame to remodel your kitchen is up to you. Having a good timetable will help you save money and time. There are two main parts of a kitchen renovation. These are pre-construction and construction.

A remodel where old things are just replaced without changing the kitchen layout will take about 6 to 8 weeks for a standard-sized kitchen. If you are doing a huge renovation where the layout is changed as well as replacing old materials, then it will take around 10 to 12 weeks.

What kitchen upgrades add value?

Renovating your kitchen in a smart way will add value to your home. Installing a kitchen island not only provides extra working space but also adds value to your resale. Refinishing or refacing your kitchen cabinets and drawers is another to add value. Installing hanging lights above the kitchen island and kitchen countertops adds beauty, functionality, and value to your kitchen and home.

A sink is very important to a renovation. There are many styles such as farmhouse, granite composite, stainless steel, and cast iron. Not only is a sink important, but an addition such as a bar sink, island sink, corner sink, or a sink with a drainboard is a must.

What is considered a minor kitchen makeover?

Typically a small kitchen remodel is budgeted under $25,000. There is no layout change and no demolition of kitchen walls or ceilings. Usually what is included is refacing and repainting cabinets and drawers, new kitchen countertops, new modern lighting, new fixtures, repainting jobs, buying smaller and greener appliances, and installing a new backsplash.

No matter the size of the job, planning ahead and budget are the key. Remember if you are using a professional, ask questions and get referrals to have peace of mind and assurance your kitchen renovation will be a success.

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Louisiana Homeowners Can Apply For $25K Grants To Help With Home Mortgage Payments

COVID-19 hit the U.S. not only with a health crisis but a financial crisis as well. Due to the pandemic, Louisiana is offering their homeowners $25,000 each in order to help catch up on late mortgage payments. Residents who are at risk of foreclosure can apply for the Lousiana Homeowner Assistance Fund.

The Lousiana Homeowner Assistance Fund is federally funded and is for Louisiana homeowners who are having a hard time paying their mortgage payment due to COVID-19 financial impacts. The program is through the Lousiana Office of Community Development under the U.S. Department of Treasury.

The program has been funded $146.7 million in federal pandemic aid. Homeowners who are earning less than 150 percent of the area median income or 100 percent of the national median income, whichever is greater.

Statewide the amount of income per household varies. For example, a three-person household in Orleans Parish who makes less than $94,650 will be eligible. A three-person household in East Baton Rouge Parish who makes less than $107,100 can get the funding.

Any homeowner in Louisiana can apply for free by submitting an application online. The application will then be assigned to a case manager. The case manager will then review for eligibility and might ask for additional documentation. Once approved the mortgage services will be paid directly on the homeowner's behalf.

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Is A 20% Downpayment Necessary?

 

Whenever a buyer thinks about a downpayment twenty percent comes to mind. This is a common misunderstanding that homebuyers have to come up with twenty percent. According to Lending Tree over half of the people surveyed said that a down payment is the biggest deterrent to purchasing a home.

Freddie Mac states “The most damaging down payment myth—since it stops the homebuying process before it can start—is the belief that 20 percent is necessary.”

The Profile of Home Buyers and Sellers from the National Association of Realtors (NAR) reports that the median down payment hasn't been over twenty percent since 2005. The current average downpayment is twelve percent and even lower for first-time homebuyers at 7%.

There are benefits to putting 20 percent down on a new home. One of the best perks is not having to obtain Private Mortgage Insurance (PMI). PMI is insurance that protects your mortgage lender in case you do not make your mortgage payments. Even if you are unable to put twenty percent down, you can ask your lender to remove PMI once you have obtained twenty percent equity in your home.

There are even good benefits for those who can put over twenty percent down. The more money you put down, the better interest rate you can get. This is not wise to do if you might need the cash in the near future. A first-time homebuyer might also opt-out from doing this because you might run into unplanned repairs or updates.

Saving for a downpayment can take time for some and be stressful. Trying to save 20 percent or more might take some months, years, or even longer. Waiting to save this much might not be in your best interest because you might miss out on a good opportunity. As you save money home vales are going up and you will lose out.

Currently, the mortgage rates are at historic lows. There are several programs that are for homebuyers to purchase a home with no money down. There are also some programs that will accept as little as 3% down.

If you are considering purchasing a home, contact a local Realtor who can help you with the loan, downpayment and home buying process. Remember interest rates are low and you do not need a huge down payment to thrive as a new homeowner.

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2022 Brings New Home Décor Trends

 

Now more than ever our home has become our sanctuary. Everyone has spent more time in our homes in the last 18 months than ever. Here are twelve trends that professionals predict for 2022.

1. Curved Furniture Silhouettes

Furniture designs are becoming a bit softer this year with curved edges and feminine shapes. This will make the room feel more cozy and safe but with bold colors and big designs. Furniture will become more of an artwork according to designer Linda Hayslett of LH. Designed. The pieces will be more refined but will also blend with function. She says to picture softer curves with a gorgeous naked back. Comfort is not the only thing homeowners are looking for, they also want something fun and striking that creates an interesting and memorable space.

2. Decorative Cabinetry

Professionals predict that your cabinets in your kitchen, powder room or mudroom will be more creative styles. Beveled shaker cabinets are coming back into style. The shaker today will be more beveled than standard with a combination of shaker styles and rails giving a more unique look.

“I think (and hope) that 2022 is the year more creative cabinetry styles will go mainstream,” says designer Kate Lester of Kate Lester Interiors. “If you’re going for a more contemporary look, I always suggest something a little different, like a vertical paneled door detail or a flat-panel style with a really unique piece of hardware.”

 

3. Sustainable Practices

“Sustainability is the new sexy—and, in 2022, we predict consciously-designed and responsibly-manufactured products to be at the forefront of every home,” says Georgie Smith and Hilary Gibbs, founders of recycled tile company LIVDEN. “From building materials to furniture, consumers are looking to adopt more innovative products that are designed from the start with sustainability in mind. Next year and beyond, we see widespread adoption of green technology in residential interiors. From smart thermostats to innovative recycled water systems, homeowners will not only be more conscious of their consumption but will also actively look to reduce their energy and water usage. Sustainability doesn’t have to mean sacrificing beautiful design. In 2022, we predict a surge of colorful and bold sustainable materials and products that will force us to reimagine what sustainable design is and can be.”

4. Loads Of Texture

This speaks for itself when it comes to decorating a space. You can layer the simple basic neutral palettes in different textures to get this look. “We'll definitely be seeing an uptick in texture in 2022—the more, the better!” says designer Andi Morse of Morse Design. “There will be more soft velvets and boucle fabrics mixed with woven furniture and sisal carpets. These elements help add warmth, creating an inviting space.”

5. Parisian-Inspired Interiors

“Next year, we’re going to see modern interpretations of Parisian-inspired designs as a popular home trend,” says Kelley Carter, Bloomingdales’ Home Fashion Director. “The intersection of color and materials will be a focal point here, with pastels and metallics coming together to create an inviting space. By bringing in design pieces made of translucent materials—like colored glass and iridescent crystal—they can create a glowing effect when you place them in an area of the home with plenty of natural light. It’s a nice way to brighten up the space and create a dreamy, warm atmosphere typical of Parisian culture.”

6. Fun Foyers

The foyer is the first place a person sees the interior of your home. This is the place where you will make a first impression. “One of my favorite new trends for 2022 is fun in the foyer,” says designer Hillary Stamm of HMS Interiors. It’s the first room people see when they come to your home, so don't be afraid to make it amazing! From vintage rugs to books and baskets, aim to create a styled but welcoming vibe.”

7. Home Bars

Homes have become more of live work and play space since the pandemic. Many rooms have learned to become flex zones such as a dining room for eating and a classroom for school from home. “Be it wet or dry, everyone wants a gorgeous, tricked-out bar in their homes right now,” says Scheer. “While it's a holdover from the pandemic, I think it's a trend that's here to stay and I'm not the least bit mad about it.”

8. Nature-Inspired Hues

“Green has always worked beautifully in interiors, especially when clients ask to bring the outdoors in,” adds designer Caroline Turner. “However, I think 2022 will be the biggest year yet for the versatile hue. Whether the application is big (my preference) or small, the right green can really pack a punch. Olive, sage, emerald, and forest are some of my favorites.”

Bringing the outdoors in through color has become ever so more popular these days. “The new neutrals for home colors are actual nature colors,” says Hayslett. “The past couple of years, people have had to spend more time outdoors, where the colors are always calming and never too stark, bright or loud. 2022 will see more designs bringing in those muted nature colors such as leafy greens, bark browns, ocean and sky blues, sandy beiges, cloudy whites, and more into the home.”

9. Vintage And Reclaimed

Second-hand shopping has become the rage as supply-chain issues have pumped the breaks on new home items. Furniture delivery is now months to a year away for most retailers. Vintage and antique furniture will become even more popular this year. “With the massive shipping delays and increased raw material prices we've seen as of late, vintage pieces have become even more desirable,” explains Lauren Meichtry of Elsie Home. “I've seen some stunning vintage pieces brought back to life with new upholstery and a little refinishing. Nothing like a global pandemic to force our hand into getting even more creative.”

10. Closed Floor Plans

“The pandemic has impacted every facet of life but especially our homes,” says Turner. “More and more time spent at home creates the need for privacy within. A big part of our job today is creating niches and nooks that feel calm and private. We’re adding walls and openings more often than we are knocking them down. The additional design opportunities are a bonus—the more closed rooms, the more creative you can be. One large open floor plan often relies heavily on neutrals and repetition to not overwhelm the eye, while a more closed floor plan has natural transition points that help a big design moment feel contained.”

11. Indoor-Outdoor Living

“Homeowners are putting more investment into their exterior spaces than ever before,” says Jean Brownhill, founder of Sweeten. “Homeowners are moving pools, outdoor kitchens, firepits, and extensive seating and dining to the top of their wish lists. In warmer climates, indoor spaces extend out to patios for indoor-outdoor living, often doubling the square footage of a home’s eating and entertaining areas. Installing bi-folding and sliding doors that span the full width of a wall can help you seamlessly connect to the outdoors, while large windows are a better option in climates with four seasons.”

12. Colorful Tableware

According to Food52's table buyer, Casey Simring, "tablescaping is quickly becoming an art form and medium for self expression. Dinnerware, glassware, even flatware, have all become opportunities to show off your personal style and curation—and the style is no longer your grandmother's bone china plates." This year? It's all about mix-and-match color. "The beauty of a mix-and-match colorful table is that you can grow your collection over time," Simring says, "adding pieces from different collections to create an eclectic yet stylish tabletop. If you're nervous, just start with the small stuff: snag a set of mixed color napkins, fun taper candles, or even a mini cake stand. Then work your way up to the tinted glassware and dinnerware styles—I find it's easier for me to commit to a set of funky color bowls before a full dinnerware set. If you're intimidated at having to style colors together, start with either warm or cool tones—you'll be surprised how easy it is to create a palette from there!"

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