It’s our guilty little pleasure. We all want to know our home's value – whether it’s worth more than last month, last year, or when we bought it.

Whether it’s just vanity or keeping up with the Joneses, everybody wants to think they have the most valuable home on the block, right? (I encounter this often with potential clients when I tell them the Zestimate can be significantly off the mark.)

So let's face facts. The Zestimate is a way to pique homeowners' interest in selling, and both Redfin and Zillow partner with real estate agents who take advantage of that. Actually, any agent may hear from potential clients based on the value they saw online.

The problem is that sometimes, a particular agent may promise a seller an unobtainable price, and the seller signs on with the idea of getting $25,000 or $50,000 or more over what other agents recommended. In the real estate business, we call this "buying a listing."

It’s not an ethical way of getting business, but it happens.

Before the housing market slowed down this summer, we looked at the general factors for Zestimate fluctuations.

Several months into this stagnant market, we're seeing more and more Zestimate drops as conditions change and different home value factors play a bigger role. The guilty pleasure of house value checking now may cause wincing as values decline.

Here's a look at the main factors for why Zestimates, Redfin home estimates, and other home value estimators are showing price drops.

Factor 1: Higher interest rates and inflation

As I noted in previous columns, the cure for high home prices is high home prices. Eventually, demand will fall, and so will prices.

However, the biggest factors pushing down estimated home prices right now are higher interest rates and inflation, which are sidelining many buyers.

Something had to give. With mortgage rates rising to the highest in nearly 20 years, we’ve finally reached that inflection point.

Each three-quarter of a point interest rate hike can add hundreds of dollars to your monthly mortgage payment. The Fed has approved several increases in 2022 alone, and the average 30-year fixed mortgage rate has gone from 3% to 7%.

As a result, home prices are finally cooling off, as it’s the only way for buyers and sellers to make deals work – other than seller help, which I’ll get to later.

To that end, some markets are seeing a decline in sales prices of 10 percent or more in the second half of 2022, even though home prices are still above 2021 prices. But that second-quarter decline will show up in your Zestimate soon if it hasn't already.

Additionally, it's important to note that Zillow says its median error rate for off-market homes nationally is 7.52%. Keep that in mind as you compare values that a comparative market analysis (CMA) from an agent will be more accurate.

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Factor 2: Missing square footage

Your Zestimate might need to include the square footage that you added. For example, my investors who buy homes in Baltimore often add a 500- to 800-square-foot addition by enlarging basements or constructing an addition at the rear.

And with soaring equity, many homeowners have used lines of credit or home improvement loans to add square footage.

Make sure your realtor knows of any additions to square footage and adds the information to the MLS. It may not show up in your Zestimate, but it will help explain to potential buyers why your sales price is over the Zestimate.

>> GET A FULL-SERVICE AGENT AT A 1.5% COMMISSION. Get personalized agent matches today from Semya-Moya with no obligation.

Factor 3: Crime rate

"What’s the crime rate in this neighborhood?" Real estate agents dread that question. But, unfortunately, we can’t tell you because it could seem we were steering you to or away from a particular neighborhood.

That’s a slam-dunk violation of federal housing law and a quick way to lose your real estate license.

But the grim reality in 2022 is that crime has edged up in many metropolitan areas. And while most of this is non-violent property crime, crime rate reports affect real estate sales in a way that the real estate industry can’t talk about.

In fact, Trulia, a Zillow Group member site, dropped its "crime overlay" filter from its search engines in the past year for listings after complaints from social justice groups saying it was de facto "steering" and reinforced racial bias. Also, Redfin recently decided not to add a crime overlay to its search engine.

Still, buyers use stand-alone crime statistics websites to guide their real estate decisions.

The bottom line? A 2019 real estate study concluded that a 1% crime rate increase drives down real estate prices by 1.5%.

Factor 4: Short sales, foreclosures, and seller concessions

Short sales and foreclosures virtually disappeared from the scene during the red-hot pandemic market. That meant they weren't dragging down neighborhood values and your Zestimate.

However, those "apples to oranges" comparisons could affect your home's Zestimate in today's stagnant market, with surging foreclosures and short sales.

A related factor is seller concessions, which had all but disappeared during the hot pandemic market. Now they're back as sellers are increasingly desperate to attract a buyer.

But seller help throws off your Zestimate as it doesn’t account for the credit given at closing to help the buyers with closing costs. So instead, it just shows up as a lower sales price.

When you work with a good realtor, they’ll know to adjust for that closing help discount that’s lowering market prices as well as throwing out short sales and foreclosure sales that drag down your competitive market analysis, or CMA.

Final Thoughts

The reality is that Zillow, Redfin and other estimation platforms are much less accurate than a well-prepared competitive market analysis (CMA) from a professional realtor.

In this difficult market, knowing your home's true market value can make the difference between getting the best price vs. not selling at all.

The post Why Is My Zillow Home Value (Zestimate) Dropping? Here Are 4 Updated Factors appeared first on Semya-Moya.

As a realtor, I hear people say things like this a lot.

In fact, an estimated 36% of sellers decide to try For Sale By Owner, or FSBO (pronounced Fizbo.) However, Zillow data shows the success rate is only 7 to 10% – and half of those sellers already know the buyer.

Further, FSBO homes sell for an average of 35% less, more than swallowing up the commission savings even if you manage to sell on your own.

One more thing: If you were hoping to avoid agents by going FSBO, you would likely fail at that, too.

Who's going to bring you your buyer? If you don't offer to pay a buyer's agent commission, you're cutting yourself off from their clients.

Even if you go alone without a seller’s agent, your buyer likely has an agent. That immediately puts you at a disadvantage. They have a pro on their side.

Once you place the FSBO sign in your yard, you will likely get calls from real estate agents – listing agents. They're trying to get your business after you fail. They know the odds.

"A FSBO always gets more interest from seller's agents than buyer agents," says Aaron Schwartz, my broker at Keller Williams Capital Properties in Bethesda, Maryland.

Notice how we keep saying the word "fail?" FSBO is full of failures.

Let's list how FSBO sellers fall short – and how a good agent can better serve your purposes.

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8 Ways That FSBO Sellers Fail

1. Mispricing your home

Everybody wants to think their house is the best on the block and worth more than all their neighbors. As a realtor, I face this all the time.

It’s natural, of course. Maybe you've made a lot of home improvements. Some improvements do indeed pay for themselves, but others don't. Like a pool, for example. I get two reactions when I show a buyer a home with a pool. It’s either excitement or a downcast "Oh, great. There's a pool."

Naturally, you’ll value your home higher if you're the homeowner. But a smart agent will tell you it’s a neutral factor on balance – unless your neighbors all have pools and you don’t. (Even then, it doesn’t hurt as much as you think.)

Also, be on the lookout for less scrupulous seller agents. They may try to "buy" listings by inflating the home's value to impress the seller. But they fall short at sale time. As a FSBO seller, you may inflate your home's value just like those agents do, but you just don't know better. The result is that your home stays on the market longer, forcing you to lower your price beyond what it should have sold for or doesn’t sell at all.

Peter Green, a retired San Francisco firefighter looking to buy a home in Palm Desert, California, encountered such a situation in 2022. The home he wanted was a FSBO, but he says working with the seller was difficult, mainly because he overpriced the home.

"The seller just looked on Zillow for comparable prices and set his price the same, not taking into account that his home needed hundreds of thousands of dollars in repairs," Green says.

2. Lack of MLS market data

The MLS, or Multiple Listing Service, provides agents with a wealth of real estate data to get you the best deal. Regular people have access to much real estate information on the web, but it can't match the power of the MLS.

A FSBO seller cannot list their property on the MLS – unless they go through a discount broker who will charge a flat fee of several hundred dollars. However, the broker doesn't help with marketing, photography or disclosures.

On the other hand, a full-service seller's agent will use the MLS to properly value your home with an insightful comparative market analysis (CMA). They will account for factors affecting comparative sales, such as seller credits or closing help, which won't show up on public sites. Appraisers can use the agent's CMA as part of their home appraisal.

Without the benefit of the MLS, the FSBO seller has less exposure to buyers and less information to price their home and defend that pricing with an appraiser or buyer's agent.

In sum, when hiring a realtor, you also hire the MLS. If you’re not, you’re bringing a knife to a gunfight – and the buyer’s agent has a gun. Not a good place to be with tens of thousands of dollars on the line. That’s what Green discovered working with his agent.

"My agent had far more information about the seller’s home than the seller himself," he says.

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3. No network at your disposal

A good realtor will have a network of vendors, contractors, and often, ready buyers for a home. Do you?

Often a realtor might have the buyer for your home lined up already or know an agent who has a client looking for a certain property. Agents share information on their clients with other agents looking for a match. Most sellers don’t have this network.

Moreover, when it comes time to prep your home for sale, you likely don’t have a network of contractors and vendors like a good agent does. Without them, you'll probably spend a lot of time getting bids and sometimes getting unreliable contractors and indifferent work.

Agents should have good relationships with vendors they know, like, and trust. Usually, those vendors and contractors will put their realtor-relationship first and put their clients on the priority list. When you hire a realtor, you also hire the MLS and their network.

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4. Not understanding how to best prepare a home for sale

One of the biggest issues FSBO sellers face is preparing their homes for sale. A realtor can help you prioritize what to do and what you can skip.

Yes, most people understand the importance of curb appeal and what a fresh coat of paint and new carpets can do. But in my experience, some sellers get "remodeling fever" and do far more than is required.

Here are 12 renovations that won't increase your value much – and 10 home projects that will increase your value for under $1,000 each.

5. Failing to stage the home (and knowing when you don’t need to)

Staging really works. While most sellers understand decluttering, they often don’t realize how important "depersonalizing" the home is. Both are key to good staging.

While often we can’t remove our entire lives from our homes, a realtor can help you with the little things needed to depersonalize the home, such as removing pictures, religious icons, or offensive items that can turn off a buyer.

Working with a realtor is key. A stager generally won’t want to work with a FSBO seller because they have a limited inventory of furniture and staging materials.

Given that a FSBO home stays longer on the market and sells for less, the stager's reputation is on the line. Working with a realtor means getting a good deal on staging – and often you don’t need to stage the entire home. And a realtor should also know the market well enough to tell you when the market is strong enough that staging drops in importance.

6. Lack of marketing and selling skills

Most people have a limited understanding of how to market and sell a home. Even salespeople in other fields may not understand the nuances of real estate sales.

On the other hand, the skills are in a realtor's wheelhouse. A good agent ensures your marketing is effective, engaging, honest and ethical.

For example, It’s fine to move a trash can out of a listing photograph, but it's unethical to use photo-editing software to erase a transmission tower or the "duplicate" tool to hide missing roof shingles.

A realtor also knows how to use professional real estate photographers and improve your listing with attractive photos, nighttime photos, videos, drone photography, and more.

Good listing agents know how to position your home with buyer's agents and their clients. They know when to push, when to pull, and when to stay quiet.

7. Not understanding legal pitfalls

Walking distance. Close to church. Family-friendly. Safe neighborhood.

If you encounter these seemingly innocuous phrases in a real estate listing, it's probably violating a local, state, or federal housing law. If you’re writing your own real estate ads, would you know what’s against the law?

"When you’re hiring an agent, you’re hiring a professional who can guide you through the legal pitfalls of the marketing," says Schwartz.

FSBO sellers aren’t subject to the same scrutiny as real estate licensees but are still subject to the same housing discrimination laws if a complaint arises. Do you know all seven protected classes under the Federal Housing Act? The states and cities that have even more? For example, in the District of Columbia, where I am licensed, it’s illegal to discriminate in housing based on political discrimination and even personal appearance!

Moreover, a realtor helps you avoid personal biases in picking an offer. (This happened to me.) Let's say you had three similar offers. All of those offers included warm hand-written letters from families who included a photograph of themselves and their children. You happened to pick the offer that wasn’t as well qualified but whose race of the buyer matched yours.

Guess what? You’ve opened yourself up to a housing discrimination lawsuit. Hiring a realtor would have protected you because they would have been smart enough to strip those letters and photos out of the offers before presenting them to you.

8. Lack of negotiation and closing support

Let’s say you do get an offer from a buyer’s agent. Now the real fun begins. Can you negotiate effectively without the MLS to determine whether the offer is fair? Can you understand all the contingencies and their impact?

In addition, a realtor will help you evaluate offers and the strength of a pre-approval letter from a lender. Some aren’t worth the paper they’re printed on. Do you know the difference between pre-approval and pre-qualification? Do you know what to ask the buyer’s loan officer to make sure the transaction will close? If you don’t use a realtor, it’s on you.

Another disadvantage is that you simply don’t know the buyer’s agent. Experienced realtors will know many agents in an area. They will know who is easy to work with and who isn't.

For example, would you know how to handle an offer from an agent who offers you a great price but slips in a "poison pill" of multiple contingencies? That agent may plan to keep reducing their offer with repair credits (not fixes) as a strategy. Some brokers instruct their agents to do that. Do you know which ones?

How about the paperwork? We all hate paperwork. And a real estate transaction is full of them. There are disclosures, disclaimers, contracts, addendums, title company closing documents, and wiring instructions. If you hate filling out paperwork, then a FSBO is definitely not for you.

In Peter Green’s case, he says the FSBO seller didn’t provide solid answers on structural and mechanical issues. That made it difficult to make an informed offer.

"He would often change his answer to our questions by the day," Green says. "We asked if certain repairs were permitted. He said they were, but when we went to the county to pull the permit there weren’t any. As a result we just didn’t feel confident that repairs were done correctly."

Listing a home requires dozens of forms and disclosures that must be filled out correctly and signed by the owner. If your disclosures are incorrect, incomplete or missing, you could lose an entire deal by giving an unhappy buyer an "out." Worse, you could be sued. Same with contracts. An incorrect name or date can void a deal or hold up closing.

Sure, you can hire a transaction coordinator or a real estate attorney to manage your sale. But guess what? Most real estate transaction coordinators are realtors with licenses in associate status. And they can charge between $800 to $2,000 to close your transaction. And a real estate attorney will probably charge the same. Almost as much as hiring a realtor to sell your property from listing to close.

"The simple fact is that the cost in time and money for a FSBO is almost always a negative value," says Schwartz.

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The post 8 FSBO Fails: How Home Sellers Go So Wrong Without an Agent appeared first on Semya-Moya.

A rapid slowdown started last summer as inflation and mortgage rates rose and potential buyers dropped out, ending the red-hot pandemic housing market. With homes taking longer to sell — and fewer buyers to compete with — the buyers who remain hold more of the cards.

So, what does that mean for home sellers?

With borrowing costs higher than they've been in several years, buyers are looking for bargains. They also have more time to shop.

Don't expect bidding wars to drive up your price, for one. Instead, expect to negotiate and possibly offer concessions. And if your home needs some work, get ready to help with the costs or give a little on your list price.

That said, there are still ways for sellers to walk away from a home sale happy.

Here's how to get ahead of a buyer's market in 2023 — including what to do when you're selling AND buying or selling and older home in need of repairs.

5 rules for selling your home in 2023

1. Spend wisely to fix up your home

Homes with the best presentation, condition, curb appeal and appearance will always command a premium. But that doesn't mean you should jump into extensive renovations to prepare your home for sale.

Instead, focus on repairs and improvements that will help your home compete against comparable ones in your area. Make sure that you'll regain at least what you put into your home through your sale prices. Make every dollar count, especially in a 2023 real estate market that will increasingly favor buyers.

Your improvements will depend on your home's age and condition. Also, consider your time frame. How much time do you have before you plan to sell? Use your available time well, especially if you plan to save money. This is no time to sit back.

Give the highest priority to items that allow a good return on investment, especially low-cost but noticeable repairs and improvements. Here are a few items that can provide bang for your buck:

• Repaint your home's exterior and key interior rooms.
• Landscape your yard and discard items you've been accumulating outside.
• Declutter and deep-clean your entire home, area by area.
• Fix leaky faucets, toilets, and showerheads.
• Adjust and lubricate your windows, doors, cabinets and drawers.
• Replace worn or damaged carpeting or flooring.
• If you're considering a bigger project due to the home's condition, focus on the kitchen or bathrooms. They tend to have the highest return on investment.

Can you do some of the work yourself? Every dollar you save puts you in a better financial position for your home sale. For example, saving $5,000 on landscaping could enable you to offer a closing credit to seal a deal with your eventual buyer.

>> RELATED: The Most Important Repairs to Make Before Selling Your House

2. Manage your cash and credit well

Be careful about your finances, especially if you plan to buy a home after you sell your current one. Don't take on unnecessary debt without a fairly good certainty of eventual payoff.

How will you pay for the repairs and improvements you are planning? If you have an existing home equity line of credit, or HELOC, that might be a good approach. However, if you're planning to sell in 2023, taking out a new HELOC or cash-out refinance probably won't make sense. You won't recover your costs. If you have a longer time frame, you might find it will pay off, but keep in mind that interest rates are high. However, mortgage interest is tax-deductible, which could help in a longer time frame.

If you have enough cash on hand, that may be your best option. Just make sure you're not cutting into your savings too much.

Also, you might be able to find a contractor who will take a down payment but wait until the home sells to collect the rest. Usually, the contractor will charge a premium for work that isn’t paid in advance. But that might be worth it to you.

3. Line up good contractors while they're available

It's a slow time for many contractors, so now's a good time to compare quotes and find a good deal to fix your home. Even if you're considering selling later in 2023, consider having the work done now. Take advantage of the time you have and get ahead of the curve.

Also, talk with an experienced realtor with a network of contractors and vendors who can maximize your renovation dollars. The good news is that many contractors will be glad to have work over the winter, and you probably can get a better deal.

>> GET A FULL-SERVICE AGENT AT A 1.5% COMMISSION. Get personalized agent matches today from Semya-Moya with no obligation.

4. Don't wait to find a good realtor

Speaking of realtors, you don't have to wait until you're ready to sell to talk to an agent or two or three. Activity has slowed for most agents, so they'll be happy to take your call, discuss your plans, and advise you.

You can discuss what improvements you should make, what contractors you might use, and how to best compete in your local market.

Also, many realtors will list your home for a reduced commission, especially if they might also earn your business for your next home purchase. No good realtor should turn down two bites at the apple. (More on this below.)

> RELATED: In This Slow Market, You Need the Right Realtor. Look for These 9 Qualities

5. Manage your expectations: Price your home to sell, not sit

The biggest mistake that sellers make is pricing their homes too high. It's often hard for a seller to have an unbiased view of their home's value.

As the market slowed in 2022, many sellers chose to take their homes off the market rather than adjust their thinking. As a result, we now have a low supply of homes for sale but relatively few buyers. But with drops in mortgage rates and more seller concessions, more buyers could jump back in this spring.

So, sellers in 2023 should prepare to make deals. First, you and your realtor need to have a conversation about what your house can fetch in the coming months. Ask the agent for a comparative market analysis of your home. The best defense for your price is a tight, well-researched CMA and a house in prime selling condition.

The National Association of Realtors predicts that price appreciation for homes nationally will slow to 5.4% in 2023, compared to 10.2% in 2022 and 17% in 2021. Also, keep in mind that home values have been dropping from their mid-2022 highs in some markets.

Options for older homes that need extensive repairs

Older homes can present challenges, so sellers might take different approaches.

1. Sell it "as-is" to regular buyers or investors

Sometimes, it makes sense to throw in the towel and sell your property "as-is." Your situation and time frame may lead you to this option.

A good realtor can prepare a comparative market analysis (CMA) for you at a listing appointment. The agent will also advise you on negotiating inspection contingencies and issues that arise from them.

You can still get a good offer for an "as-is" property in this market. Investors are always looking for properties in disrepair so they can fix them up and flip them.

And buyers who are priced out of other homes may be interested in your fixer-upper. They can use FHA 203K loans to pay for renovations if it's their primary residence.

>> RELATED: Now might be the best time to sell your house

2. Donate it to charity and get the tax write-off

If the home is in bad shape, consider donating it to charity. You’ll get a generous tax write-off for the home's full market value as if it didn't need repairs. In addition, in many cases you can carry over the deduction for up to five years. And you avoid any capital gains taxes.

I recently had a client with a one-acre plot of land in Potomac, Maryland. Unfortunately, it failed its perc test for a septic system, dropping its value. So, instead of selling the land for little more than he paid for it 30 years ago, he donated it to a charity and got full market value as a tax write-off.

What if you're selling AND buying?

As we discussed earlier, buyers hold more cards in this housing market. But it's hard to consider it a true buyer's market. Mortgage rates have dropped almost a point from their 7% peak, but they remain double what they were a year ago. So purchasing power has fallen.

Here's what to do if you'll be on both sides of the table: selling and buying.

1. Crush your debt as if you were a first-time home buyer

Suppose you’re planning to buy a bigger house and counting on getting the best interest rate for that new loan. You don’t want maxed-out credit cards and other debt harming your credit score. That would mean a higher rate.

Also, you want a healthy debt-to-income ratio, which lenders will review closely.

2. Put your listing agent to work finding you a new home

If you're going to use your seller’s agent as your buyer's agent once your house sells, put them to work NOW looking for homes for you.

With luck, the agent can scout out some good deals for you early. They might even arrange an off-market deal so you can buy your home without contingencies, such as needing to sell your current home first and extinguish the mortgage before buying another one.

The good news is in this market, more sellers will entertain offers with contingencies. They may be in the same boat as you, offering closing help for buyers.

As previously mentioned, using the same agent for both transactions gives you leverage to negotiate a discounted commission for the sale. The agent will then likely make a larger commission on your purchase, and that commission comes from that seller. (Of course, it's worked into the selling price, though.)

The commissions depend partly on what's customary in your market and the competition. Here's a state-by-state comparison of average commission rates.

>> GET A FULL-SERVICE AGENT AT A 1.5% COMMISSION. Get personalized agent matches today from Semya-Moya with no obligation.

3. Work with a lender to get a rate buy-down and longer lock

Mortgage rates rose to 7% but have dropped closer to 6% in recent weeks. Some economists predict they could hit 7% again, but nobody knows for sure with all the economic factors at play.

One good way for buyers to approach this volatility is by "buying down" the mortgage rate. That means you pay for percentage points to bring down your rate.

You might even negotiate a concession with your seller to pay for the buy-down. A smaller concession on this can often beat a bigger lowering of the home's price. For example, a $6,000 concession for a rate-buydown could save your more than a $20,000 drop in the selling price, depending on the home's value and your mortgage rate.

To that end, many lenders have been offering rate buydowns and longer rate locks. Long locks enable you to shop with confidence, knowing that a rate increase won’t knock you out of qualifying.

In this market, you might need every available tool to make the numbers work.

The post Selling Your Home in 2023: 5 Rules to Help You Get Ahead of a Buyer's Market appeared first on Semya-Moya.

I was a Maryland firefighter for 10 years, and we often called December-February "fire season." According to the National Fire Protection Association, our holiday activities significantly increase our fire risks each year.

I once saw a house burn down after someone tossed a bag of burned popcorn on a wooden deck at a family holiday gathering. Another time, my squad quickly put out an attic fire on Christmas Eve. We even managed to rescue the presents.

I retired from the fire service 10 years ago, but now as a realtor, I'm keeping up the fire safety message: Have fun and enjoy your families, but be safe. The home can be a dangerous place if you're not careful.

This article is my third in a three-part series: I previously wrote 7 Home Fire Risks That May Be Lurking All Around and 15 Home Safety Hazards – And What to Do About Them.

And now, here are four holiday hazards to avoid:

Thanksgiving and Christmas cooking accidents

While the "fire season" might officially begin in December, the NFPA says Thanksgiving is the single-biggest day of cooking-related fires during the year, with more than 1,600 incidents – three times as many as a normal day. (Christmas Eve and Christmas Day are the second and third biggest days for cooking-related fires.)

The factors include alcohol consumption, unattended stoves, fireplaces, and smoking. But the leading cause of Thanksgiving fires is deep fryers. The popularity of deep-fried turkeys has led to a large increase in fires and accidents.

The NFPA says deep-fryer fires cause about $15 million in property damage annually. Most fires result from lowering a frozen or partly frozen turkey into the deep fryer. The retained water rapidly boils over in the fryer's 400-degree oil. The boiling oil spills onto the gas or electric heating element and starts a fast-burning fire, as this NFPA video dramatically shows.

While most people are smart enough not to use a deep fryer indoors, sometimes people cause fires when they use them on a deck or inside a garage. Worse, people often use a 20-gallon liquid propane cylinder, which increases the risk of an explosion if flames reach the tank or the hose breaks.

Bottom line: Don't use a deep-fryer for a Thanksgiving or Christmas turkey unless you are well-experienced and follow all safety precautions.

Christmas trees, decorations, lights, and candles

Each year, firefighters respond to more than 150 fires started by Christmas trees, causing about a dozen deaths and injuries, plus $10 million in property damage, according to the NFPA.

Electric lights caused about half the fires, while an open flame too close to the tree caused 20% of the fires.

The NFPA says the most serious Christmas tree fires occur in January when trees are dryer. So consider taking down your tree right after the holidays if that's not already your habit.

Fire can engulf a dry Christmas tree in as little as ten seconds, as this video shows, and spread to the rest of the room, overwhelming your ability to escape. By contrast, a well-watered tree will take far longer to burn, allowing more time to exit your home.

How can you tell if a tree is too dry? If you brush your hand over the needles, it’s a fire hazard. Keep your tree watered and throw it out when needles start to fall.

However, according to the NFPA, the Christmas tree isn't the biggest culprit in holiday fires. Each year, holiday decorations cause nearly 800 fires, two dozen injuries, and $13 million in damage. Often the reason is frayed wiring or decorations being too close to open flames.

Spend as much time fireproofing your decorations and lighting as you do on decorating your Christmas tree. Throw out any decoration and wiring that is frayed or hot to the touch when operating. And never run extension cords for decorations under rugs or floor coverings.

The last hazard in this category is candles. One in ten candle fires in the U.S. occurs during the holidays. According to the NFPA, candle fires cause nearly 800 deaths and injuries a year, and nearly $300 million in property damage. The fires usually result from candles coming too close to draperies, mattresses, or bedding.

Bottom line: Whether it's candles in the window for Christmas or Hanukkah candles in your menorah, don’t leave them unattended while they’re burning, and make sure they are out before you go to bed.

Chimney fires

Few people roast chestnuts on an open fire these days, but they love using their fireplaces during the holidays.

The NFPA reports that about 50,000 fires occur a year due to malfunctioning heating equipment, causing 500 deaths and about $1.1 billion in property damage. About one-third of those heating fires are chimney fires, which can result from a build-up of creosote.

Creosote can ignite suddenly and burn intensely hot, up to 2,000 degrees Fahrenheit. If the chimney flue is cracked or damaged, the fire can rapidly spread through the walls and attic and fill the home with smoke.

Any firefighter will tell you a chimney fire is very difficult to handle. It’s also messy, as most departments will use dry-chemical extinguishing agents rather than water to put out the fire in the flue.

So before your holidays begin, ensure your chimney flue is properly inspected and cleaned by a licensed chimney sweep.

> RELATED: How Much Does It Cost to Clean and Inspect Your Chimney?

Lithium-ion batteries

Lithium-ion batteries are becoming the industry standard for many electronic devices, toys, drones, e-cigarettes, and "micro-mobility" scooters and skateboards.

These little batteries pack a lot of power and are widely used, but they can be a fire risk if not used properly.

Apple devices such as iPhones use lithium-ion batteries, while Android phones tend to use lithium-polymer batteries.

Any time a lithium-ion battery device feels hot or emits an odor, turn it off and move away from anything that can catch fire. Don't charge lithium-ion devices on bedding or in direct sunlight. Don't substitute power cords from a different device. Instead, use the cord that came with the device.

Last week in Manhattan, firefighters dramatically rescued a woman from a high-rise apartment building fire caused by an "e-bike" with a lithium-ion battery. Dozens of residents were injured. The building posts signs banning this equipment, but at least one person didn't follow that rule.

Final thoughts

Look around your home this holiday season, and ensure you're covering the fire safety basics. They're easy to follow. Enjoy your holidays!

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The post Avoid These 4 Home Hazards Over the Holidays in 2022 appeared first on Semya-Moya.

While home values have moderated in recent months, they are still well up from a year ago, and an astonishing 29% higher than before the pandemic, according to Zillow.

American homeowners now average more than $300,000 in home equity, says research firm CoreLogic. That’s almost the average price of a U.S. home: $348,000.

With high mortgage rates, inflation and home prices, many potential buyers and sellers are sitting it out. But that doesn’t mean Americans aren’t making use of their homes for cash. More than half of Americans took on home renovations in 2022.

What's the next best thing to a new home? A spruced-up current one. It may be even better if you like your current home and location.

So how do you go about it? Assuming you don't have a pile of cash to fund your renovation, you have three main options:

• Cash-out refinance
• Home equity line of credit, or HELOC
• Home equity loan

Here's a look at each financing option for your home renovation.

Cash-out refinance

With a cash-out refinance, you take out a new mortgage for a higher amount, get cash back, and retire the existing mortgage.

Until recently, a cash-out refinance was the most popular choice to tap into home equity.

The reason was historically low interest rates. In addition, the cash-out refinance allows you to take out up to 80% of your home's value – and you can deduct the mortgage interest on your federal tax return.

However, with today's 30-year mortgage rates hovering around 7%, this option has lost its luster. Swapping your current rate (likely 3-4%) with a higher one to access cash just isn’t a smart move.

"Over the past eight months, we have seen the steepest climb of interest rates in 25 years – leaving the cash-out refinance option the least attractive of the three (home loan options)," says Mark Livingstone, president of Cornerstone First Financial in Washington D.C. (Full disclosure: I have partnered with Mark in my realtor work.)

Livingstone says a homeowner could end up with a refi rate of 7% or more.

"With most Americans currently sitting at a rate around 3% or below, switching to a much higher rate to take cash out may not be a good tradeoff unless they are looking to take a large amount," Livingstone says. "We are advising clients not to trade in their low interest rate but maybe look into a signature loan through their credit union or a HELOC."

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Home equity line of credit (HELOC)

A home equity line of credit is like a credit card against your home. The homeowner can take the money out, pay it back, and take it out again, as many times as they like. The rate is adjustable and tied to the prime rate.

The borrower's credit score helps to determine their initial interest rate. The higher your score, the better your rate. Also, the interest is tax-deductible if you use the proceeds for home improvements. The borrower has the option of paying simple interest for a predetermined amount of time (usually 10 years) so the payment is minimal until the payment adjusts to include principal and interest.

>>NEED A BETTER CREDIT SCORE? Get a free credit evaluation from Lex Law!

HELOCs are usually capped at 80% of the home's value, and that 80% is the combination of both the first mortgage and the HELOC (also known as the combined loan to value, or CLTV). Most banks offer free HELOCs to their clients as long as the line stays open for a minimum of three years, lenders say.

Still, HELOCs are just like credit cards, and that means the interest rates on the credit line can adjust, and with the Fed raising rates, that means they’re likely to go up.

"When you hear of the Fed changing rates, like the multiple increases this year, this directly affects the rates of these lines of credit," says Darren Ferlisi of Integrity Home Mortgage Corp. in Frederick, Maryland. (I also have worked with Darren.)

Ferlisi says lenders are also still a little gun-shy with HELOCs from the 2008 housing crash. Lenders can limit the combined loan-to-value (CLTV) ratio, including the first mortgage, if applicable, to 75% in some cases, depending on credit score and debt-to-income ratio.

Home equity loan

A home equity loan is a second mortgage and usually caps at 80% CLTV.

The loan amortizes like a first mortgage. Most of the payment pays down interest at first, then slowly pays off the principal over time. Even so, the interest rate can be high, even if it’s fixed.

"The interest rate on a home equity loan is often a good deal higher than a first mortgage or a HELOC – and like the HELOC is predicated by the credit score of the applicant," says Cornerstone First’s Livingstone.

Unlike a HELOC, a home equity loan allows the borrower to take all the money upfront and makes principal and interest payments for a predetermined term. "If you need a large amount, a home equity loan may be the best way to go," says Livingstone.

Bottom line

A well-planned, well-executed home renovation can bring you a lot of satisfaction. Renovations also raise your home value, especially if you focus on the kitchen and bathrooms.

One note of caution: If you plan to leave your home for the project's duration, especially six months or more, you run the risk of your lender considering you an "investor" and not a homeowner. That could mean higher rates.

As always, talk to an experienced lender who can help determine which loan product is right for you.

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The post How to Fund a Home Renovation: Home Equity Loan Vs. Refi Vs. HELOC appeared first on Semya-Moya.

An estimated 470,000 new homes were listed for sale at the end of October, representing a supply of 8.9 months at the current sales rate. A 6-month supply is considered balanced.

Builders were constructing 400,000 new homes as of two months ago, and many of those homes are now listed or will be soon.

While the median price for a new-construction home ($470,600) is up 14% from a year ago, the National Association of Home Builders (NAHB) says builders are in a bargaining mood, with many builders offering incentives such as interest rate buy-downs, closing credits and throwing in amenities.

"It’s definitely a buyer's market," says Robert Dietz, chief economist of the NAHB. "I would encourage buyers to take advantage."

In this market, buyer demand is down, and the housing supply is up. Demand is down because buyers face high home prices, inflation, and mortgage rates hovering around 7%, the highest in 20 years.

However, the NAHB also noted in September that 20,000 new construction homes were listed under $300,000, more than three times as many as were available in 2021 (just 6,000).

For home builders, the second half of 2022 has been terrible. They often invest so much in a development that they just want to close it out and repay their construction loans. As a result, they usually will offer increased incentives to sell the last few homes of the development if they can clear their books.

Still, don’t look for price cuts, but you may be able to get some hardwood floors, stainless steel appliances, and an increased closing credit instead.

"Builders don’t want to cut their prices because the cost of construction is still going up," Dietz says.

So, think about this option even if you've never considered new construction. The increasing glut of new-construction homes could work in your favor. Plus, you can select home options and see your home being built. Still, there are also pitfalls when purchasing new construction, so be aware.

Here’s a list of tips for buying a new-construction home.

>>THINKING ABOUT BUYING?Check out today's best mortgages

You get to customize your home – to a point and at a price

People love visiting the model home at a home builder's site. It’s like something out of Home & Garden TV. You'll see trendy furniture, perfect staging, and every upgrade the homebuilder offers. Like any auto dealer, they’ll put the fully loaded model on the floor and the base model in the back of the lot.

You will eventually discover that many of the model home's features aren't standard, so it always pays to ask upfront. If you don't ask, you'll get a surprise later when you discover that the model's wonderful flooring, appliance package, and cabinetry are "premium tier." They'll add tens of thousands of dollars to your base price. If you request them after a certain point, the builder will consider them "custom change orders," costing you an additional fee.

>>GET THE FACTS before you buy a home. Download Semya-Moya's free home-buying guide and get weekly tips.

I bought my first home, a new-construction townhouse, in 2005. We loved the features and finishes but were disappointed that we needed to pay a $2,000 change order fee to get the model home's pendant lighting over the kitchen island, wall sconces and wainscoting. Plus, we needed to pay for the upgrades themselves.

Be prepared for your design center consultant to show you expensive options and say, "You can just roll it into your mortgage." (I was tempted by an overpriced $30,000 home theater system.)

Like anything, your manageable $350,000 home budget and $2,000 monthly mortgage payment can easily become $375,000 and $2,250 a month when you start throwing things in.

Bottom line: Stick to your budget. If you can’t make the numbers work, find another place to cut, or negotiate with the home builder or your agent. In this market, you have leverage. So negotiate for those upgrades to be included. At worst, you can buy a better upgrade later at a lower price.

>> RELATED: 7 Questions You Must Ask When Buying a New-Construction Home

A buyer's agent can still help

Even with new construction, the buyer's agent serves a valuable role as your representative. They provide guidance on choosing the builder and development, as well as on the contract, the building process, and closing. Otherwise, you are at the mercy of the home builder.

But if you’ve been working with a buyer's agent, remember that home builders don’t like agents. They may have a "Brokers Warmly Welcomed'' sign outside the model home, but it’s not entirely true. Why would they want to pay out thousands of dollars in commission if they don’t have to?

The bottom line: Unless your buyer's agent accompanies you to the model home visit, they could get stiffed out of a commission even though they've been helping you all along.

When working as a buyer's agent, I routinely ask prospective clients if they are considering new construction. If they say yes, I preregister them at developments under construction.

You can get a closing credit (or a rate buy-down) but at a price

I’ll admit that a $10,000 closing credit is hard to turn down. That's what my builder offered us when we bought our first home in 2005. The catch was that we had to use the homebuilder’s preferred in-house lender and title company. The homebuilder’s logic is sound (at least on their end). And as noted above, builder-affiliated lenders are also throwing in rate buy-downs to help with mortgage rates hovering around 7%.

Even though you can choose any lender or title company, the builder wants a quick close, and so do you. So a $5,000 to $10,000 closing credit is worth it to them. But is it worth it to you?

In our case, the preferred lender's rates were about 25 basis points higher than our other pre-approved lenders rates. Their title company and appraiser charged us a premium as well. Of course, the homebuilder had an answer for that, namely we could always refinance after six months, which we ended up doing, but it still cost us another origination fee.

The bottom line: When you work with a builder, you’re expected to use their lender, appraiser, and title company. Use your agent to run the numbers and see if it’s still worth it. It might be. But again, you have leverage in this market and can negotiate.

>>RELATED: 7 FAQs About Negotiating When Buying a New Construction Home

Get to know your builder's construction foreman

One advantage of buying new construction is you may get to see the home built unless it's completed or mostly completed.

In our case, we enjoyed taking pictures of the progress. But most builders don't want you to scrutinize their work. Still, that shouldn't stop you. Scrutinize anyway.

Typically the home builder will give you an inspection opportunity when the framing is complete and before the drywall is mounted. Take advantage of this. While it’s not a typical "home inspection," there’s no reason you can’t take your home inspector with you to this walk-through. You don’t get to look behind the walls at an existing home during its inspection, so use this one to your advantage.

Look to be sure the studs and framing materials are straight and true and don’t contain excessive knots. Make sure no trash or bottles are being sealed up behind a wall. Take photos and document any issues.

Introduce yourself to the construction foreman. Let them put on a show of how good their work is. Compliment them where appropriate. This is your opportunity to make them an ally and do a good job for you.

The pre-framing inspection is also your last chance to make changes to finishing materials, wiring, and utilities. So now's the time if you want recessed lighting in a particular room, electric outlets moved, or cable or phone boxes added.

When the house is complete, you still have your traditional inspection. Work with your agent and inspector to ensure your home’s punch list is completed satisfactorily. And a good relationship with your construction foreman can pay off now. They'll be more willing to work with you on your punch list and fix it to your satisfaction.

In addition, most builders will offer a free warranty to fix drywall nail pops and ceiling cracks at milestones such as six months, one year, and/or two years. However, I recommend waiting a year to fix nail pops and ceiling cracks since the house is still settling before that.

Final thoughts

I enjoyed meeting our new soon-to-be neighbors during the building process. We formed some great bonds as we watched our houses being built and celebrated with housewarming parties together.

But it's also a reality check when the builder's people who were so nice to you during the sales and building process aren't so helpful and responsive when any problems arise after closing.

Be prepared for highs and lows during the process. But if you choose a good builder and make good choices, you can end up with a new home you love.

The post Buyers May Find Deals in Glut of New Homes – But Be Savvy appeared first on Semya-Moya.

So, should you as a homeowner jump on the bandwagon? Should you be one of the estimated 4% of owners with an "accessory dwelling unit" (ADU) on your property? Could you earn useful income by renting it out?

Consider these three factors to decide whether an ADU is right for you.

Shutterstock

ADUs offer modest income, but they're more about affordable housing

ADUs are especially popular now, but they've offered affordable housing for many years, especially in times of need.

For example, ADUs sprang up in the New Deal years to house workers and again during World War II for factory workers. They went by various names, such English basements and garage apartments. They provided necessary housing at critical times.

Today, the law keeps the focus on affordability by placing limits on homeowners.

Some cities and counties limit ADU size to 750 square feet, enough for a one-bedroom, one-bathroom apartment. It typically can be only one story. It's part of your primary residence, so you can't sell it as a separate parcel or condo.

You also may face setback restrictions, with ADUs set back at least six to ten feet from the property line and at least 60 feet from the front lot line. Again, this is to limit size. Nevertheless, some jurisdictions will allow several ADUs on one property so long as the zoning is residential, even R-1 (single-family).

> Related: What Is a Mother-in-Law Suite?

Do the math: low permitting fees but high construction costs vs. income

Your city or county may want to encourage ADUs, so they often offer streamlined construction permits of about $5,000, compared to $20,000 for a single-family home.

That's good, but it pales in comparison with construction costs. This is where you must do your math to see when your costs would be offset by your rental income.

This isn't just an academic exercise for me. As a realtor and son, I'm working on converting my mother's two-story barn into an ADU in Berkeley, California.

Photo by Daniel Goldstein

We’re looking at about $300,000 in permitting, architectural and construction costs for a 1,000-square-foot unit with two bedrooms and one-and-a-half baths. (Berkeley is grandfathering us in under the ordinance, so we're allowed the larger size.)

A fellow realtor friend in nearby Oakland spent $200,000 to raise his two-story home to allow a basement ADU. We think the math will work out for both of us because median rents are so in our areas. The average rent in Berkeley is $3,300, and average rent in Oakland is $2,800.

Another factor: Your ADU investment also raises your home value. So depending on your situation, you may consider that in addition to the cost vs. rental income calculation.

You really need to drill down into the construction costs to see if it's worthwhile. For example, if your ADU is attached to the main house, you’re likely to need a 200-amp electrical panel to handle the increased load of two kitchens with all the same appliances as well as a washer and dryer.

Add in a separate HVAC with its own thermostat, AC split or wall unit and a heater and hot water heater. Or if you are on natural gas, adding more gas lines for heating and cooking and washing.

If your ADU is going to be a separate unit as my mom’s will be, you’ll have to extend plumbing and gas lines underground from the main house to the unit. That means digging, and digging means more permits and informing the county to mark utility lines before you dig.

In addition, most cities want power lines underground as much as possible for safety and aesthetic reasons. Moreover, your existing home may not be tall enough to have a safe drop to the detached ADU. (Most must be 12 feet high or more.)

If you want to create a basement apartment, you’ll likely have to dig out the slab, which can be expensive ($20,000 or more), Add waterproofing if the water table is too high or the site has drainage issues.

Indeed, part of the expense of constructing our ADU is replacing a concrete slab that has an inch-wide crack going down the middle of the barn as a result of sitting virtually on the Hayward Fault for nearly 100 years.

Bottom line: While the permitting climate for ADUs is friendlier, the construction costs aren't. Do the math.

Are you ready to be a landlord with landlord headaches?

You might get a great tenant who rarely asks for anything. You might spend very little on maintenance.

But don't count on it. Not everyone is cut out to be a landlord, with the patience and persistence to keep on top of everything.

Common landlord headaches include finding a suitable tenant, running credit checks, drawing up leases, collecting rent, maintenance, repairs and unfortunately, going through the eviction process if needed. (That becomes much more awkward if the tenant is on your property.)

Of course, you could hire a property manager to handle these duties, but cuts into your profits with a typical 5 to 8% monthly management fee.

Also, keep in mind that some jurisdictions limit rent increases yearly, unless the tenant moves out and you can reset the clock.

Your bottom line

Think of the ADU as the $5 table of real estate investing. It's lower stakes than leaping into single-family homes or multi-family homes.

You may earn a modest income stream that helps your finances, but you must watch the upfront costs for construction or renovation.

You might be lucky enough to already have an ADU that's not being used, or could be cleaned out for a tenant. In that case, your costs might be pretty low. Just consider if you're up to the landlord role.

In any case, you won't get rich with an ADU, but you might find the income helpful. And you'll be creating affordable housing for someone.

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The post Should You Jump on the Garage Apartment (ADU) Trend? How to Decide appeared first on Semya-Moya.

I got my start as part of a Boy Scout service project in 1989. I restored a pair of historic lantern pillars in my neighborhood of Berkeley, California. I quickly learned how complicated it was to get the necessary approvals and how many people were involved.

It's the same way all these years later. But despite the extra paperwork, investing in a historic home or property can be financially and emotionally rewarding. You just have to know how to do it.

Based on my experience working with historic properties here in Maryland for investors, I've compiled this list of seven do's and don'ts. You can see these lessons in action in my current rehab project: the historical Beall House in Brunswick, Maryland. We're rehabbing it from its fire damage.

The fire-damaged Beall House, the oldest home in Brunswick, Maryland, will soon be restored.

Don’t be afraid if the listing says 'historic'

Most investors will avoid anything that could delay, disrupt, or complicate their investment. And it’s true that when you’re dealing with historic properties, you’ve got a whole host of new issues. These include historic preservation committee reviews, strict requirements for exterior materials, more reviews, increased costs for building materials that must match the historic district guidelines, and longer holding times.

But it's also true that certain buyers will pay a premium for a well-done historic property if it's marketed properly. There’s always a buyer willing to pay for character, charm, history, and prestige.

I’m currently working with an investor on the historic Beall House in Brunswick, Maryland. Built in 1792, it's the oldest house in the city. A fire badly damaged it in 2020. The house was a near-total loss, and most investors shied away because they had to rebuild it according to exacting historical standards.

However, we did our due diligence, ran our comps, and decided the numbers would still work even with the higher rehab costs. We saw an excellent resale opportunity, the availability of grant money, and yes, the great location.

Do your due diligence, but be even more conservative

Even with all that, we realized we faced substantial upcharges for building materials. For example, the property required a metal roof, per guidelines, and not an asphalt roof. That meant a $20,000 roof budget, not $12,000.

Vinyl windows were out, so we had to special-order steel-framed windows, adding $6,000 to our budget. Our holding costs budget increased because of pandemic-related delays on these building materials.

This substantially increased our rehab budget, but we’re confident that we'll be fine given our purchase price and expected resale price. Make sure your numbers hold up and build in a contingency factor to your rehab budget of at least 10 to 20%.

Every battle is won or lost before it is ever fought, as Michael Douglas’ character Gordo Gekko told Charlie Sheen’s Bud Fox in the movie Wall Street.

Expect to invest your time, not just your money

Expect to keep busy, whether you're meeting with city council members, historic preservation staff, city inspectors, or a neighborhood advisory council. If you’re restoring a piece of a city’s history, expect everybody to take an interest.

Make time for them when you can. Your project can be green-lit or red-taped to oblivion, sometimes with as little as one phone call from a well-connected city insider. Learning to play the political game is as important as knowing codes and construction.

If you plan on maximizing every possible avenue for tax credits and grants to restore a historic property, boost your timeline by at least six months or a year and calculate that into your holding cost. As you’ll see below, all the plans and applications for grants and credits must be completed and approved before you put a shovel in the ground.

>RELATED: 5 Things to Know if You're Thinking of Buying an Old House

Hire a good contractor who understands the stakes

If possible, work with a good contractor who has experience with historic properties. Not every contractor understands the significance of a historic property. It's also critical that your crew knows they can’t cut corners on a historic property.

For example, if the city’s historic district guidelines call for wood siding only, a cheaper wood-look alternative isn’t going to work. People are watching. For example, I had one investor who installed vinyl windows in a home in a historic district in Cambridge, Maryland, but it required metal-frame windows. Less than 24 hours later, he received a stop-work order and an order to remove them or face fines.

At a different project, workers installed incorrect siding because of miscommunication with preservation staff and a language barrier. The siding had to be removed, costing several thousand dollars in materials and labor.

Thankfully on that same project, we got a historic preservation committee to agree that "metal roof" didn’t mean steel, and allowed us to use aluminum instead so long as the look was correct. This ended up saving us about $10,000 in our construction budget.

Bottom line: Expect delays, and build them into your budget.

Don't rely solely on your own money. Find OPM!

If you’ve been reading my columns, you know what OPM means. Other People’s Money. That means loans and grants, not your funds. Fortunately, many government grants are available to restore historic properties. They might be local, state, or federal money.

As always, money like this comes with strings attached. Expect to compete with many other worthy projects, and learn to sharpen your grant-writing skills. You can always hire your realtor to do some of this work. Or hire an outside consultant to coordinate bids and photographs and write applications.

Grants usually require several bids from prospective contractors who will do the work. To be chosen, the bids must be reasonably priced and show a detailed scope of work. The contractor should be licensed and bonded, and have experience working with historic properties.

In addition, most grants work by reimbursing you after the work is done, and no work can start until the grant is approved. However, working on other parts of the house during the grant process is acceptable if the work is separate from what appears in the application.

For example, you might work on mechanical components inside the house as you await approval of exterior decorative features. Always check first with the grant organization.

Claim (and advertise) the tax breaks

Depending on the city and county, you’re typically allowed some hefty tax breaks and credits if you own a home in a historic district and fix it up.

In Baltimore, these are called CHAP credits. CHAP stands for the City Commission on Historic and Architectural Preservation. These credits incentivize improvements by providing a tax credit against the assessment of the improved value for ten years, and they can be transferred to a new homeowner.

When listing the property, ensure prospective buyers know about any tax credit still available to them.

In addition, state and federal tax credits are available. For example, you can qualify for a conservation easement from the IRS. The idea is to compensate you because you won't be able to add to the historic home's square footage, or you can't build on a portion of the property because it’s in a protected wetland. Either way, you must get the conservation easement approved before starting any work. Consult with your accountant or financial adviser closely on this.

Invest in marketing for your historic property

Restoring a historic property can attract a lot of attention, both from inspectors and prospective buyers. Take advantage of it when you sell. Pick a realtor with extensive experience marketing historic properties with impactful photos. They'll also know where to advertise, such as in publications for unique properties.

Invite local officials for an exclusive, catered open house to show off the project and tell your story to local newspapers and community organizations. Everybody loves a party. And there’s no better media than free media. As always, work with an experienced realtor skilled in marketing, promotion, and media relations.

Again, build this additional cost into your numbers.

A young Dan Goldstein stands in front of his lantern pillar restoration project in Berkeley, California, in 1989.

Final thoughts

Restoring history isn’t easy, and not every investor wants to do it. But it can be rewarding if you find the right project with the right numbers. You might earn both a legacy and a profit.

The post Should You Invest in a Historic Home? 7 Lessons and a Live Example appeared first on Semya-Moya.

Today I’ll look at 15 non-fire household hazards you might not be aware of – and what you can do about them. We'll focus more on the first five hazards since they especially hit home with me.

1. Lagged decks vs. free-standing decks

Nearly half of America's 60 million decks fail to meet safety standards, according to the North American Decking and Railing Association.

And nearly 6,000 injuries a year result from deck collapses or loose railings, says the Consumer Product Safety Commission.

The worst deck collapse in U.S. history occurred in 2003. An improperly secured deck at a Chicago row house fell, killing 17 people and injuring 57. The culprit was what’s called a lagged deck.

A lagged deck rests on posts on one side and connects to the house on the other side. The builder or do-it-yourselfer typically installs a ledger board on the home and bolts the deck to it. They install flashing to protect the home and board from water damage.

Even if you build a lagged deck properly, it’s not as strong as a free-standing deck with supporting posts sunk into concrete on all sides.

A properly constructed lagged deck should have solid carriage bolts (minimum half-inch wide) that fasten to the home's interior framing every 16 inches to 2 feet, depending on your local code.

In reality, many decks don't meet the local code. Sometimes they're even just nailed to the home's exterior. Many homeowners fail to obtain building permits for decks.

Almost always, a lagged deck collapse occurs at the weakest point, namely where the deck attaches to the house via the ledger board. That area can rot with water intrusion. A combination of rot and overloading can be tragic.

In 2015, five Irish exchange students and one U.S. student at the University of California at Berkeley died when a balcony on an apartment collapsed, dropping partygoers onto the pavement 40 feet below. A sixth Irish student injured in the collapse died just this year from complications.

Dry rot had damaged the cantilevered wood under the balcony, turning much of the support members into powder.

So if you have a lagged deck, what can you do? First, inspect the ledger board and make sure it is securely fastened to the house. Second, make sure the metal flashing that should be protecting the ledger board from moisture is intact. Any damaged ledger board or flashing must be replaced. Third, inspect the hangers that connect the deck joists to the ledger board. Replace any rusted or loose hangers.

Bottom line: If you invest in a deck, build a free-standing one. Yes, it’s more expensive, but also much safer.

2. TVs, appliances, and furniture that can tip over

Nearly 500 children have died and 10,000 have been injured since 2000 due to tipped-over items in U.S. homes. And nearly 80 percent of those deaths involved televisions, according to the Consumer Product Safety Commission.

Most of those injuries and deaths occurred when children climbed onto furniture and pulled down a TV on a stand.

With Americans buying nearly 45 million TVs annually, the potential for tragedy is wide open.

The good news is that injuries and deaths have declined by about 25% since 2015, when the Consumer Product Safety Commission started its Anchor It campaign. It encourages parents to install inexpensive anti-tip devices ($20 or less) that are drilled into a wall stud and strapped to the furniture and the television. Tip injuries dropped from 20,000 in 2015 to about 15,000 in 2020.

The campaign also called for anti-tip brackets to be installed in lightweight stoves that could tip over if a child stood on an oven door or even just pulled on the handle. (The CSPC reported 28 child deaths since 2000 due to those lightweight kitchen stoves.)

In general, the CSPC recommends that parents recycle old or unused televisions. They also say not to place toys or items like a remote control on the TV because they may tempt the child.

The CSPC says to place heavier items lower in drawers or dressers to keep the center of gravity down to avoid tip-overs. Keep TV and other cords out of a child’s reach.

3. Drapery and blind cords as a strangulation hazard for kids

This one hits home to me as both a firefighter and a father.

A few years ago, a 7-year-old boy at Fort Detrick here in Frederick, Maryland, choked to death when he accidentally got caught up in the cords of window coverings. He went to school at my son’s elementary school, Whittier, and I knew the federal firefighters on the Army base who responded first. The call was so traumatic that the firefighters were sent home for the rest of their shift and the city’s fire department covered the base for the rest of the night.

According to the Consumer Product Safety Commission, about ten children under 5 die yearly from accidental strangulation from window covering cords. Young children can quickly and silently strangle on pull cords, continuous loop cords, inner cords, or any other accessible cords longer than 8 inches, according to the CPSC.

To that end, the CPSC voted to strengthen a previous 2018 regulatory directive regarding window coverings this month. Now, more stock coverings must have short, inaccessible cords or no cords. About 80 percent of all stock window coverings currently meet these safety requirements.

In general, the CPSC recommends eliminating corded window coverings. But if you can’t do that, the CPSC recommends the following:

• Eliminate dangling cords by making the pull cords as short as possible.
• Keep all window covering cords out of the reach of children.
• Ensure that cord stops are installed properly and adjusted to limit the movement of inner lift cords.
• Anchor continuous-loop cords to the floor or wall for draperies and blinds.
• Move all cribs, beds, furniture and toys away from windows and window covering cords, preferably to another wall.

4. Carbon monoxide, the silent killer

It doesn’t matter whether you have gas appliances or not, carbon monoxide can be a silent killer. A malfunctioning space heater can give off carbon monoxide, as can a malfunctioning refrigerator. And running your car in your closed garage is another way to have carbon monoxide enter your home.

As a firefighter, I can tell you carbon monoxide (CO) is one of the most insidious home hazards. As I wrote about smoke detectors in the fire hazards article, most homes have the wrong alarms, which don’t respond to slow-burning fires that produce carbon monoxide.

Carbon monoxide is odorless and colorless, unlike natural gas, which contains "mercaptans" that create a nasty rotten egg-like smell to alert you to a leak.

Carbon monoxide also binds to the hemoglobin in your red blood cells better than oxygen, and it’s easy to become lightheaded, dizzy, or nauseous. Naturally, your first instinct is to sit down or lie down. And when it comes to CO poisoning, you can easily fall asleep and not wake up.

Indeed, more than 400 people die annually in the U.S. from carbon monoxide poisoning each year, and 50,000 people are sent to the hospital as a result, according to the Centers for Disease Control.

The bottom line is any device that burns fuel or is motorized can produce CO if it is malfunctioning, improperly installed, or used inside when it’s designed for outdoor use only.

Your furnace, water heater, stove, space heater, fireplace, wood stove, charcoal grill, and dryer can be sources of CO, especially if they are not in good working condition or don't have proper ventilation.

The best way to protect yourself is to install CO detectors on every floor, especially in basements where your water heater, dryer, and furnace are often located. Ideally, the carbon monoxide detector should be hardwired into your existing smoke detector system so that if it sounds in one room, it sounds in all rooms.

>RELATED: How Much Does Indoor Air Quality Testing Cost?

It should also have an audible alert that is different from your smoke alarm and also can audibly tell you that carbon monoxide levels have become dangerously high.

Don’t investigate when a CO alarm sounds. Leave the house and call 911. Let firefighters investigate while they are on their own self-contained air and with their own equipment.

5. Asbestos siding, tiles and insulation

If you live in a house over 50 years old, chances are that you still have asbestos somewhere in it. It might be asbestos siding, a water heater jacket, pipe insulation, or asbestos floor tile. Asbestos products weren't banned until 1977.

> RELATED: Should I Buy a House with Asbestos Siding (Pros and Cons)

The danger from asbestos comes when it deteriorates and particles become airborne. The asbestos fibers can irritate your lungs and cause respiratory disorders. If you have inhaled enough over the years, asbestos can lead to a type of lung cancer called mesothelioma.

My father worked as a master carpenter and was surrounded by asbestos products, including insulation and floor tile. He died of mesothelioma in 2008 at the age of 80. It was a complete shock to the family. Anyone who has worked in shipyards or the auto industry has likely been exposed to asbestos as well.

If you have asbestos products in your house, sometimes it’s best to let sleeping dogs lie. Removing it can cause more problems, and most asbestos removal experts will tell you to encapsulate it in place instead.

Removing asbestos shingling (as one of my recent investor projects required) is usually safe so long as it isn’t drilled, cracked or stripped off in a way that creates dust that can be inhaled.

It's the same situation with asbestos floor tile. (Any 9-inch-by -9-inch tile in an old home is likely made with asbestos). It’s safe as long as you don’t sand it, drill it or saw it.

>RELATED: How Much Does It Cost to Test for Asbestos?

As always, consult an expert to see if an asbestos product in your home is safe or requires removal.

10 other household hazards

• Mold: Household mold can range from minor discoloration in your shower to a dangerous invasion of your home that requires professional mold remediation. If left unchecked, it can create serious air quality problems and severe allergic reactions. A mold inspection can determine whether your home has a problem.
• Household poisons: Homes commonly contain cleaners and other products that are harmful if swallowed. These might include bleach, drain cleaners, dryer sheets, or many other products. It's essential to use child locks or ties on cabinets containing these items.
• Medicines: The same thing goes for the medicine cabinet. Make sure children and pets cannot get into your medicines. Discard outdated medicine bottles.
• Unlocked firearms: Following basic gun safety rules prevents tragedies, especially involving children. Always store firearms unloaded in a locked box or cabinet. Curious children have a way of finding things, and accidental shootings happen every year despite gun safety courses and constant messaging from responsible gun owners.
• Radon: This cancer-causing gas can build up in some homes, particularly basements and crawl spaces, from decaying uranium, which naturally occurs in many soils. Here's the EPA's radon guide, which includes testing information.
• Swimming pools and hot tubs: Install fences and child-proof gates around home pools and hot tubs. Far too many tragedies continue to happen with kids falling into pools.
• Tubs and showers: These are among the most common places to fall in the home, especially as people get older. Install non-skid pads and grab bars to help prevent falls.
• Slippery floors: Make sure floors aren't too waxy or slippery. Use stable rugs. Alert family members to any wet floors. Clean up any spills.
• Staircases: Falls on stairs are all too common. The best advice to everyone: Slow down and use the railings. If you have wood stairs, you might add anti-skid tape.
• Loose railings: Ensure all railings in and outside the home are secure. This includes railings on stairways, front and back steps, balconies, decks, and open hallways or walkways. In addition, check the width of the balusters on the railings. If you can put your fist horizontally through the gap between two, it’s too wide. A child could get their head stuck between them.

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The post 15 Home Safety Hazards – And What to Do About Them appeared first on Semya-Moya.

I’ve held many different titles in my 50-plus years, but none more important than "firefighter." Even though I retired from it 10 years ago, I always bring that passion for fire safety to my real estate clients.

The good news is that today's home builders and contractors use more fire-resistant, safer materials than ever. They no longer use the past hazardous balloon-frame wood construction and knob-and-tube wiring.

For example, today's ubiquitous drywall (gypsum) delays fires from spreading due to its water content of 20%. And today's interior doors can typically hold off a fire for up to 45 minutes – which is why you should close your bedroom door at night.

Unfortunately, despite all the improvements, dangers remain in most American homes.

The National Association of Home Builders and other groups continue to lobby against more safety provisions, such as mandatory sprinklers in new single-family homes, mostly due to cost.

Also, today's home builders commonly use lightweight wood roof trusses with an Achilles heel: They can collapse quickly and unexpectedly in fires, endangering occupants and firefighters.

It's important for homeowners to be aware of fire hazards in their homes – and to take steps to improve their home's safety whenever possible. Here are seven key dangers to check in your own home.

1. Do you have the right smoke detectors?

First, here’s the good news: An estimated 96% of American homes have at least one smoke detector, according to the U.S. Fire Administration and the National Institutes of Science and Technology.

However, 90% of smoke detectors are a less effective type – and they cost lives each year.

The National Fire Protection Association says about 100 million U.S. homes rely on ionization smoke detectors, which don't work as well as the more expensive photoelectric sensors.

Ionization detector with its cover off

Ionization detectors use a tiny amount of radioactive material to trip the alarm when it senses small burning particles. They work well enough with fast-spreading kitchen fires, but they are less able to detect slow-burning or smoldering fires caused by common culprits like cigarettes, frayed appliance wires, and fireplace sparks.

As many as 30,000 people in the U.S. have died since 1990 because they relied on ionization detectors, according to Joseph Fleming, a fire consultant and deputy chief at the Boston Fire Department. That’s because an ionization alarm can take 20 to 50 minutes longer to activate than a photoelectric smoke alarm.

Fleming’s analysis of Massachusetts fire deaths determined that ionization alarms contributed to about half of the deaths. He concluded that switching to photoelectric alarms should reduce fire deaths by about 35%.

So why do so many homes have ionization alarms in the first place?

Answer: They’re generally cheaper. Depending on the brand and features, they can be half the price of a photoelectric model, typically costing $30 to $80 at retail. Also, the battery on an ionization alarm tends to last longer.

Besides taking longer to activate in slow-burning fires, ionization models also have another problem: high false alarm rates. Cooking and showering can trigger them, prompting many people to disconnect their ionization alarms. Photoelectric alarms, which use a beam of light to sniff out larger burning particles, have fewer false alarms.

Also, by the time an ionization alarm activates due to an actual fire, smoke and carbon monoxide levels are likely to have built up sufficiently to disorient you and make you unable to exit your home.

Bottom line: Ensure that the only place you have an ionization alarm is in your kitchen, which tends to have faster-burning fires. Use photoelectric detectors in bedrooms, hallways, and other house areas. Ideally, they should be hardwired with a battery backup so if one alarm sounds, they all will sound.

If your house doesn’t have hardwired smoke detectors, get a 10-year sealed lithium battery detector. In many jurisdictions, 9-volt standalone detectors are no longer acceptable.

2. Lightweight roof trusses

Lightweight wood roof truss with metal gussets

Today's builders commonly use lightweight wood roof trusses instead of the rafters of years past. However, fire officials have contended for years that these trusses can collapse quickly in fires and endanger lives.

These trusses, present in 66% of American homes, are cost-efficient and strong in most situations – except for fires.

Fire experts have long warned that the heat from fires can pop off the metal gussets that connect the wood, collapsing the roof. These connectors have teeth on one side that sink into the wood without using nails, staples, screws or bolts. So instead, truss companies build them off-site, with machines pressing the plates into place against the lumber. Builders like the lower cost, and building codes typically allow them.

Wood rafters, also called stick construction

Older homes typically have wood rafters, also called stick construction, instead of trusses. So do some new homes. Builders constructed rafters on-site for many years until wood trusses came into widespread use. Builders and others point to the advantages of trusses, including weight distribution, quality control, speed of manufacture, and lower cost.

Roof collapses caused by fires have been in the news for years. In 2018, a firefighter in Howard County, Maryland, died after he fell through the floor of a home with lightweight trusses that had been burning for more than an hour. Because it was a single-family home, it wasn’t required to have sprinklers, unlike many townhomes or condos built with wood trusses.

In January 2013, firefighters of the Manhasset-Lakeville Fire Department in New York responded to a fire in a home's basement. They had to evacuate within minutes when the first floor started separating from the house. The first floor collapsed into the basement within 45 seconds of the last firefighter evacuating.

As a result of the close call for firefighters in New York state, then-Gov. Andrew Cuomo signed a bill into law in October 2014 that requires a truss notification system on all new construction homes in the state. Still, the construction industry has opposed creating a national truss identification system.

As a result, many fire departments won’t risk fighting a fire inside the home unless an occupant's life is in danger. Unfortunately, that often means your home will sustain more water damage because firefighters use more water to spray it from outside.

Many residential building codes now require sprinkler systems for homes with trusses. However, sprinklers add to the home's cost and run the slight risk of being accidentally set off, damaging the house and its contents.

What can a homeowner do about all of this? Unfortunately, not much. Just be aware and practice good fire safety in your home, as everyone should.

And if you're unsure about your home's roof construction, you or someone else can climb (safely, of course) into the attic to check.

3. Gas lines using corrugated stainless steel tubing

More than two million U.S. homes have a type of gas piping known as corrugated stainless steel tubing, or CSST, which is thinner, more flexible and cheaper but is also more susceptible to damage due to lightning strikes.

A lightning bolt can burn holes in the tubing and cause a fire from leaking natural gas or even a catastrophic explosion. In 2007, homeowners settled a class-action lawsuit against the makers of several gas lines that were found to be insufficiently resistant to lightning strikes.

The widow of the previously mentioned Maryland firefighter settled a lawsuit in June with the maker of the CSST piping. The suit claimed the company continued to sell the product, knowing it was a factor in more than 75 lightning-induced fires.

Bottom line: If you have a home with CSST, have it replaced by a licensed plumber.

In addition, if your house was built between 1860 and 1915, you may have lines in the walls that once supplied natural gas for lighting.

Some lines have been capped off, and others have been converted to electric, but some are still active and potentially dangerous. For example, an active gas line in one home was used as a towel rack, according to this website for home inspectors.

Make sure you know what’s behind a wall before you drill!

4. Aluminum wiring and Stab-Lok breaker panels

Builders and electricians commonly used aluminum wiring from the 1950s to the 1980s. Unfortunately, it oxidizes over time at connections such as the outlets, switches, and breaker panels, creating a fire hazard.

Aluminum wiring also expands and contracts due to its lower conductivity, creating heat and loosening connections. In addition, inexperienced electricians would strip the softer aluminum wiring the same way they stripped the more resilient copper wiring, which would lead to nicks that eventually became breaks.

Have you ever seen scorching around an outlet or light switch? Or smelled a metallic burning odor when you flipped a switch? That could be from aluminum wiring.

Old aluminum wiring

A homeowner or inspector can identify aluminum wiring by looking at the wires and breaker panel. You'll see "AL" stamped on the wires and sometimes on the electrical panel itself. The Federal Pacific Electrical Company (FPE) manufactured many of these "Stab-Lok" breaker boxes, which were installed from the 1950s to the 1980s.

The "Stab-Lok" panel got its name from the breakers "stabbing" into the bus bar in an overload and "locking" into place. But the breaker design often failed to trip – causing fires. Importantly, aluminum wiring and the FPE panels were typically installed together. So a good home inspector or electrician will tell you that if there’s an FPE breaker panel, you probably have aluminum wiring.

You need to remove aluminum wiring or replace the connections with "pigtails" that join copper and aluminum wiring. Unfortunately, rewiring a house can cost as much as $8,000 to $10,000. But considering that a home insurer typically won’t underwrite a policy for a place with aluminum wiring, you may not have an option.

5. Knob-and-tube wiring and ungrounded 2-prong outlets

Knob-and-tube wiring

Encountering a house with ceramic knob-and-tube wiring is rare these days, but they still exist. You’ll only find it in homes built in the late 1870s through the early 1900s.

Knob-and-tube wiring was used before the advent of refrigeration and appliances, so it wasn't designed to handle the necessary amperage. As a result, wires without grounds can cause fires if the circuit gets overloaded. One signal of a home containing knob-and-tube wiring is the presence of two-pronged electrical outlets which don’t have a third prong for a ground wire.

In addition, the wiring was strung freely inside voids to allow the heat to dissipate, but it's compromised when insulation surrounds it. Over time the wires can sag and come into contact with plumbing and other building materials, allowing heat to build up and causing fires. The wires are also particularly vulnerable to moisture and can cause electrical shocks when wet.

Bottom line: Knob-and-tube wiring is a dangerous Victorian-era relic that a licensed electrician should replace or make safe.

6. Electric space heaters

Electric space heater

Electric space heaters are convenient and helpful when you need a little extra heat to warm up a chilly basement, home office or bathroom on a cold morning. Contractors also use space heaters to cure drywall and speed evaporation in cold weather.

But they’re also an extreme fire hazard. The NFPA says that one out of SEVEN fires in the home (more than 45,000 a year) are caused by malfunctioning heating equipment, and more than 80 percent of the 500 fatalities a year involved portable space heaters. Indeed, 17 people, including eight children, were killed in January of 2022 when a fire swept through an apartment in New York’s Bronx neighborhood. The fire was blamed on a malfunctioning space heater.

The dangers of space heaters are both obvious and hidden. For one, they draw a lot of amperage, which if you’ve been reading this piece, doesn’t play well with outdated wiring. Amps mean heat, And if your wiring isn’t able to handle the draw from a space heater, you could be looking at a fire.

Space heaters must have automatic shutoffs and tip-over shutoffs, but that doesn’t help when a blanket or drapery contacts the heating element and starts a fire. The NFPA noted that more than 50% of home heating fire deaths resulted from contact with the heating element of a portable heater.

Bottom line: Avoid using space heaters in rooms where people are sleeping or where they are left unattended while running.

7. Overloaded outlets and power strips

Too many plugs in an electrical outlet

Do you know someone who plugs way too much into outlets and power strips? I bet you do. This is one of the most common home fire hazards.

Even Hollywood has taken notice. For example, you may have seen the movie "A Christmas Story" where the father (Darren McGavin) plugs his "Major Award" into an overloaded, ungrounded, two-pronged outlet. Or when the father in "Christmas Vacation" (Chevy Chase) blacks out the whole city with his overloaded Christmas light setup?

Not to be a killjoy here, but the reality is that electrical problems such as overloaded circuits can lead to tragedy. Any plug or wire that’s hot to the touch is overloaded beyond its capacity. A sharp, acrid smell means the wire is hot enough to burn its insulation. So replace it as soon as possible.

Power strips also can be a fire hazard. They're often overloaded or placed where heat can’t dissipate. Power strips aren't designed to handle high-amperage appliances. They handle lower-amp items like computers, lights, and alarm clocks.

In addition, plugging one power strip into another, or "daisy-chaining," is particularly dangerous as it can cause a short beyond the capacity of the internal circuit breaker.

Finally, never use a power strip in a kitchen or basement where moisture is present. And if a power strip is hot to the touch, unplug it immediately.

Other common home fire hazards

Here's a quick checklist of other common home fire risks. People cause these fires through unsafe behavior:

• Smoking when you might fall asleep
• Improperly storing gasoline, propane, solvents or other flammable materials
• Barbecuing too close to your house
• Using a fire pit too close to your home
• Leaving your stove unattended while cooking
• Leaving a sparking fireplace unattended

Final thoughts from a former firefighter

Many of us think of our homes as sanctuaries. We want them to be safe and secure. But often, we may not be aware of the dangers around us. Other times, we're vaguely aware but aren't careful. If this article prompts you to make your home safer, I've done my job. Once a firefighter, always a firefighter.

"The funny thing about firemen is...night and day they are always firemen."

-- Donald Sutherland as an arsonist in the movie "Backdraft"

Daniel Goldstein, back in his firefighter days in Montgomery County, Maryland

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The post 7 Home Fire Risks That May Be Lurking All Around You appeared first on Semya-Moya.