As a seasoned homeowner, you’ve been paying off your mortgage and are now considering buying a second home – a place you can retreat to on vacation, an investment property, or maybe even a combination of the two. You’ve been through the home-buying process before so you know what to expect, but there are certain factors unique to buying a second home that you'll want to consider. These factors will vary depending on how you intend to use the property, so it's a good idea to determine if the home will be for mostly personal use or if it will be occupied by tenants.
Here are six essential things you should consider before buying a second home:
1. Can I Afford It?
It may seem like an obvious question, but can you afford a second home? If you choose to take out a mortgage on a new property, take some time to carefully understand the requirements so you’ll be better prepared for the process when submitting your mortgage application.
As a homeowner, you're probably well aware of the strict credit requirements for taking out a mortgage, and things get even more serious when it comes to buying a second home. Your debt-to-income ratio will, of course, be a significant factor, and when it comes to holding two mortgages, you may find it a bit more challenging to balance this ratio. Also, be prepared to shell out a hefty amount for a down payment, since you'll be required to put at least 10 percent down on a vacation home and perhaps an even higher amount if it will be used as an investment property. And don’t forget that a second home will need to be protected, so you’ll want to talk to your homeowners insurance agent about getting a quote, once you’ve got your sights set on a second property to call your own.
2. How Will It Affect My Taxes?
Understanding the tax implications of your new property will be another challenge. If you intend to rent your place to tenants, that means you'll earn rental income throughout the year, and that income will be taxable. As the owner of the home, you also may be able to take deductions in the form of mortgage interest, property taxes, repairs, depreciation, and operating expenses.1 One of the most important things to do as the landlord is to maintain accurate records of your income and expenses throughout the year in order to properly report the information on your tax return.
3. What Home Expenses Should I Expect?
Just like your primary residence, your second home will also require you to shell out cash for expenses – both expected and unplanned. It’s helpful to have a budget set up for home needs, and with two homes, this may be an even more critical step, since your expenses will be elevated. In addition to the maintenance costs, remember you'll have property taxes, insurance, potential homeowners' association dues and more. If the property is at the beach or in a flood zone, you'll also need to consider things like flood insurance in addition to your regular homeowners policy. And finally, if you plan to rent the property, you'll also need to look into insurance that specifically protects you as a landlord.
Travelers wants to help you protect the things that matter to you. We offer a wide breadth of products so you can be covered at home and on the road.
4. How Will I Use the Property?
If the property will solely be used for personal vacations, this question isn't as critical. However, if you intend to rent the home occasionally or full time, you'll want to consider your strategy ahead of time. Keep in mind that for mortgage purposes, your lender doesn't consider the income generated from renting the home. Whether you can afford the second property is determined solely based on your credit and debt-to-income ratio. If you plan to rent the home, it's important to build your rental strategy as early in the process as possible to ensure you'll have rental income that can help offset the home's monthly expenses from the start. That will translate to less cash out of your pocket, as long as the tenants are diligent in paying the rent on time.
5. Who Will Maintain the Property?
You’ll want to plan for who will maintain the property to protect your investment. If the investment property is located near your primary home, it may be easy for you to provide the regular maintenance and upkeep of the home, if you’re handy and have the time – and the will – to do those tasks. However, if the property is far from your primary home, you'll need to think about how it will be cared for when you're not staying there. This is especially important if the property is located in an area that’s susceptible to strong storms and hurricanes. Severe weather events can pop up at a moment's notice, and your second home will need to be properly prepared to withstand such weather. If the home will be for your personal use, perhaps you can find a neighbor to keep an eye on the house when you're not there. If you plan to rent the home, consider hiring a rental management company to take care of the general upkeep so you won't have to worry about every little detail from afar.
6. Is the Property in an Ideal Location?
Whether buying a second home for your personal enjoyment or as an investment property, make sure you choose the right location for your needs. You may not get as much use as you’d like from a vacation home that requires extensive travel to get there. And, a rental home in an unpopular locale may lead to months of being unoccupied – which means you’re paying the second mortgage yourself rather than with income from renting it out. In either scenario, ensuring the home is in an ideal area can help provide you with a positive return on investment. If you do intend to rent the property, take some time to research the rental climate in the area before moving forward. The best places to own investment property are often popular vacation destinations and cities with an abundance of career options.
Buying a second home doesn't have to be daunting. In fact, with careful research and planning, it can be a smart investment for your future.
Millions of students in the U.S. are learning from home because of the coronavirus pandemic, and many parents may be feeling the stress of juggling working from home and guiding their children’s educations.
As the weeks at home with your kids continue to add up, you may have come across some unique or especially difficult challenges with this new setup. Here are a few recommendations to help guide you through some of the challenges that parents are facing during this time:
You may have made a daily or weekly schedule when your child’s school first closed its doors due to
COVID 19. Perhaps it worked well for the first week or two, but by now, that schedule may need adjusting as you and your family have settled into your temporary routine.
The truth is, creating a schedule for the entire week may not be feasible. Instead, during breakfast each morning, take a few minutes to talk with your kids about the day ahead and what schoolwork they need to accomplish ‒ and when. Encourage stability and regularity as much as you can. Setting daily expectations for your kids and making sure they meet them by the day’s end will help them stay disciplined.
In some schools, students aren’t allowed to use smartphones in classrooms. The same should be true at home, at least when they’re completing their schoolwork. Keep them focused on their education by limiting phone use to non-study time. This is likely to get harder as more weeks roll by without your kids having face-to-face interaction with their peers. Consider using screen time as a reward for an assignment well done or completed early.
Tip: Stay aware while your children are studying at home by looking out for unusual phone, digital or social media activity.
Equipping Kids for Success
Your kids need certain equipment and internet access to learn online. It’s a big challenge for some families, but help is becoming more available. For example, Everyoneon.org maintains a list of sources where students can access affordable computers and broadband.
Keeping Kids Connected
You may be concerned about your children feeling isolated from the social connections they normally have at school. While you don’t want screen time merging with school time, easing up a bit on your screen time rules and limits (if you haven’t already) may be the best way to get through this time.
Allow children to interact with friends via video to help them maintain the relationships they’ve built in the classroom. Partner with other parents to plan virtual play and activity dates. Supporting these connections can be vital to your children’s learning and will help to provide some balance in their lives.
Networking With Parents
Connecting with other parents has obvious social benefits. As the coronavirus pandemic wears on, networking can be a good way to learn about the approaches other parents are taking with at-home education and what successes they’ve had. Plan virtual events to talk with other families and share with each other how you are making it through this time.
Education is important, but the mental and emotional health of your children is even more critical. Check in throughout the day to make sure they’re doing okay. If something’s wrong, take time to stop what you’re doing and work with them to deal with their fears and concerns.
If you're looking to sell your home — and get top-dollar for it — staging the property can help you do it.
Put simply, staging means preparing the home for a potential buyer — or "setting the stage," if you will. It involves redecorating, rearranging furniture, cleaning and other aesthetic strategies to present the home in the best possible light. The goal is to make the home as appealing as possible to the most potential buyers.
Benefits of Home Staging
Home staging comes with many benefits. For one, it can make it easier for potential buyers to envision themselves in the home. It provides a clean palette of sorts — one without clutter, personal photographs and other items that might turn off a buyer or make it hard to imagine themselves living on the property.
According to a study from the National Association of REALTORS© (NAR), 77 percent of buyers say it's easier to visualize a staged property as a future home.1
Staging also makes a home look more "move-in ready" — meaning that it doesn't seem to need a lot of work or repair before a new buyer could move in. Seventy-one percent of buyers are looking for a move-in ready home.2 Staging could help give that impression, which could be a nice advantage for you in successfully selling your home.
Finally, staging a home makes it easier to market. It looks better in listing photos (which can play a big role in today's home-shopping process), and it is also more eye-catching when shared on social media, printed on flyers and displayed in other visual marketing mediums. As a result, staged homes typically sell faster. According to NAR, 62 percent of agents say staging has an impact on a home's time on the market.3
Options for Home Staging
You have a few options when looking to stage your home. You can choose to do the process yourself (DIY); you can look to your real estate agent for help; or you can bring in a professional staging company to do the work on your behalf. In some cases, you could also do a combination of these options.
Though these pros do come at a fee, they typically do the work for you. They will evaluate your home's current condition, make recommendations on how to improve its overall appeal to potential buyers and marketability, and then put those suggestions into action by rearranging the furniture, bringing in new décor or helping you declutter.
Often, stagers have a large inventory of furniture, décor, artwork and other items they can pull from to help your home look its best. Just be aware that using a stager's inventory may come with an extra fee, so be sure to ask about that.
Calfee Insurance allows you to customize your coverage to fit your unique needs. We focus on understanding you, so you'll feel right at home working with us.
How Much Does It Cost to Stage a House?
According to the National Association of Realtors, the median cost of home staging is $675.4 These costs vary, though, and depend on several factors, including the size, location and price of the home, the exact type of staging services you're looking for, and whether you need additional furniture, décor or other items in your staging efforts. Some agents recommend spending between 1 to 3 percent of your home's listing price on staging.
If you're staging your home yourself, you'll want to consider the costs of things like:
Consider shopping at thrift stores or second-hand shops for any new décor or furnishings you might need. You might also want to focus your staging efforts on only a few rooms — higher impact areas like the living area, the kitchen and the master bedroom.
Is Home Staging Worth it?
From a financial standpoint, staging can add measurable selling appeal to a home. According to NAR, nearly a third of real estate agents say staging increases the dollar value offered by buyers, in comparison to similar homes, by 1 to 5 percent. Another 21 percent of agents say it increased the dollar value of the home between 6 and 10 percent.5
To determine if staging a house is worth it, you'll want to consider a few things, including:
Home staging may increase the likelihood that you'll sell your property and do so quickly, and for top-dollar. If you're on a tight timeline or looking to boost your profits on the sale, home staging can certainly help. It also can be beneficial if your market is particularly competitive for sellers by ensuring your home is memorable, beautiful and stands out from the rest.
If you're ever unsure of whether staging is in your best interest, consider speaking to a local real estate agent. They can help assess your property as well as make recommendations based on the market and preferences of local buyers.
Selling your home is an important life moment. Why not also take it as an opportunity to review your homeowners coverage?
If you've experienced a big shift or have something planned for the future, you may need to adjust your policy accordingly.
Want to make sure you have the right protection? Review this list of events to see if you should make updates to your insurance coverage.
6 Home Organizing Projects to Keep Your Children Busy While You're Working From Home During COVID-19
While many of us are adjusting to social distancing during the coronavirus pandemic, parents are juggling their daily work activities with caring for their children. If you are working from home (WFH), you may have calls to make, emails to send or a video call to dial into while you try to keep your kids safely occupied.
There is a bright side to sheltering in place while working from home, and it’s not just the cozy family togetherness. You can get a jump on some of the home organizing projects on your to-do list, while helping your children learn how they can pitch in to help.
Get together as a family to brainstorm potential projects. Let the kids come up with some of their own, weighing in on what they want to do. Consider creating a schedule and come up with little rewards they might get ‒ such as extra screen time after finishing a big task or a project, one-on-one time with a parent, a walk around the neighborhood, or time playing catch.
Here are some organizing ideas that can help occupy the kids while you’re working from home during the COVID-19 pandemic.
1. Home Office
Looking for a fun way to get the kids to help clean your home office? Let them shred paper! Just note that it’s not recommended to recycle or toss financial documents, as these can contain personal information that can be used for identity theft.
Different documents should be held for different amounts of time, usually 1 to 7 years, though some should be kept forever. Double-check your shred pile for these types of documents before your kids start shredding them. If your children are old enough to use a shredder, give them a proper tutorial to make sure they know how to use it safely and supervise if necessary. Better yet, let them tear up the paper with their hands. Just make sure they know they have to pick up any bits of paper they drop and toss them in the trash.
Bikes, balls, holiday decorations, lawn equipment and gardening supplies might be, piled up in your garage, even with a car parked inside it. Let the kids get some fresh air while you’re WFH and sort through their outside toys. Have them decide what to keep and what to donate or throw away. Discard broken or nonworking items like deflated balls, broken sporting equipment or a cracked bike helmet. Discovering boxes of sidewalk chalk and the forgotten scooter can also give them something to do after organizing.
3. Spice Rack
While you make dinner or continue to WFH in the next room, let the kids organize the spice rack. They can organize alphabetically or by spice type ‒ baking, green spices, salts, etc. It’s also a good time to weed out empty bottles and make sure that the contents of remaining bottles are not past their expiration date.
With the kids at home full time, they may be scattering their toys around the room more than usual. While you’re WFH, have them use this time to set aside any broken items and less-loved toys that might make another child happy. Throw out the broken toys, and box up any that can be donated.
Kids grow quickly, and their clothing from last season may no longer fit them. To clear out these wardrobe items, have your kids put on a fashion show to let you see what no longer fits. At the same time, this can be a good time to plow through email on your laptop while in their room, either sitting at their desk or on their bed. It’ll take time for the kids to change into different outfits, and they can hang up or fold the clothes in between. Keep a bin or bag ready for donations.
Pantry organizing can take several routes. Kids can inventory what goods are in the pantry and start a shopping list for future trips or deliveries. They can throw out expired food and wipe the cabinets clean (a great way to introduce them to the task of spring cleaning!). Kids who like to cook could use the ingredients they find to plan recipes. Some websites can even recommend recipes based on the ingredients you have on hand.
Letting the kids do some home organizing while you’re work from home doesn’t have to be a chore. What’s more, if you’re thinking of selling your house in the near future, you’ll be in a better position to begin that process of decluttering.
Organizing can be an educational process, even if your kids don’t know that you’re trying to teach them something. After they get into the swing of things, they may not even want a reward, since they’re having so much fun. Plus, seeing the results of an inviting toy pile, a pantry with lots of promise or a closet full of clothing that fits is a reward in itself.
Remember, especially in times like these, Calfee Insurance cares and is here for our customers when they need us. If there is anything we can do for you, please do not hesitate to contact us at 508-540-2601.
Buying renters insurance to protect your stuff may seem like an unnecessary expense, until you experience a theft or fire in your rented home or apartment and lose some of your most treasured possessions forever.
Whether you're a longtime renter or starting out in your first place, renters insurance policies provide important benefits and coverage. If a fire or similar incident destroyed your home and you didn't have renters coverage, it would be up to you to replace everything you own. Plus, if someone claimed you caused an injury or property damage, without adequate insurance protection, you could be at risk for an expensive lawsuit and paying that person for his or her damages.
As you consider whether to buy renters insurance, here are four things you need to know:
1. Renters Insurance Provides Off-Premises Coverage
Renters insurance does more than cover the cost of lost or damaged possessions in your home. There is coverage if your bicycle is stolen from a bike rack at the park, or if your laptop is taken from your car while you're at the supermarket.
2. You Can Be Compensated if You're Forced to Relocate
Most renters policies provide additional living expenses coverage if your home becomes uninhabitable due to an event such as vandalism, theft, fire or water damage from home utilities.1 This benefit usually includes the cost of living expenses, up to your policy limits.
This coverage typically is limited to 30 to 50 percent of your insured personal property. For example, if your belongings were insured for $100,000, the limit on additional living expenses would be $30,000 to $50,000, as outlined in your policy.
3. A Home Inventory Can Determine How Much Coverage You Need
Before you decide how much coverage you need, it's important to know how much it would cost to replace your possessions. You can calculate replacement costs by conducting a home inventory and checking with your insurance representative to make certain you're fully covered.2
4. You Can Reduce Your Renters Insurance Costs
There are a variety of ways to reduce the cost of renters insurance. An option is to select a higher policy deductible, the amount you must pay before your insurance coverage takes effect. Increasing a deductible from $250 to $500 could create an annual savings of up to 15 percent.
You also may want to consider buying all your insurance policies from one carrier. For example, when you bundle your auto and renters policies, you receive additional savings.
Find Out the Benefits of an Annual Check-In
Do you have the right amount of property coverage?
This question is an important one to ask each year. Life changes and the passage of time can affect the cost of rebuilding your home or replacing your vehicle.
Want to make sure you’d be covered in the case of an unexpected event? Take a quick look at these examples and reach out if you’d like to check in.
Say you’ve been driving since you were 16 and have never needed to file a claim. Then, one day you accidentally hit a pole in a parking lot in a moment of distraction.
Even a minor incident like this could end up causing thousands of dollars in damage. If you have collision coverage with a manageable deductible as well as rental car coverage, you’ll most likely end up facing far less financial strain than if you were underinsured.
Here’s another example: Imagine that an ongoing lumber shortage has increased homebuilding costs by thousands of dollars. If a natural disaster were to severely damage your home, you want to make sure your policy would cover the rebuilding costs no matter what.
Upcoming or Recent Changes
Remember, life events like getting married, moving, gaining or losing income, and when a teen starts driving can all affect your coverage needs and options. Knowing you have the right policy can help bring peace of mind as well as better financial security.
As 2021 gets going, reach out to make sure you’re adequately covered this year.
Do you know where most home fires start?
If you guessed the kitchen, you’re right. One of the most popular rooms in the house also has the potential for danger.
But a few simple habits can help prevent damaging fires from ever starting in the first place.
To find a little more peace of mind this season, here are four ways to make your home safer.
1. Don’t walk away from an active stove.
Unattended cooking is a leading cause of kitchen fires. If you need to leave while frying, grilling or broiling, make sure to turn your stove off first. It’s easy to lose track of time when you step away to answer the door or check on the kids, and it doesn’t take long for trouble to start.
2. Keep clutter under control.
It’s not uncommon for kitchen counters to get loaded up with stuff. Make it a priority to clear your kitchen countertops of anything flammable, such as wooden utensils, papers and dish towels, especially around the stove.
3. Use space heaters, fireplaces and woodburning stoves safely.
If you use a space heater during colder months, consider replacing older models with one designed to turn off if it tips over. Position space heaters with a 3-foot distance from everything else and always turn them off before you leave the house or go to sleep.
If your home has a fireplace or wood-burning stove, have it inspected annually by a professional. Use a mesh screen to keep sparks inside the fireplace.
4. Practice candle safety.
As with a stove, a lit candle is an active fire that you shouldn’t leave unattended. Blow out candles before leaving a room and keep burning candles on level surfaces and away from flammable objects, young children and pets.
Have questions about your insurance coverage? Reach out and we’ll be happy to help.
How to Budget for Home Improvements
Your home has probably been through a lot this year.
Between normal wear and tear and the extra hours spent at home these last few months, you may find yourself in need of an upgrade or repair sometime soon.
Some projects can’t wait, but if you have time to save, here are a few strategies to help you manage that add-on, appliance replacement, or whatever else your property might need in 2021.
5 Tips for Managing Your Project
1. Compare Estimates
Gather estimates from a few reputable contractors and compare them. Calculate the average cost of your project and plan your budget around that number.
2. Create a Sinking Fund
Banks love to advertise home equity loans and lines of credit. However, financing your home improvement means paying interest, which raises the total cost of the project. If it can wait, try to save up first by creating a sinking fund: Set aside a certain amount each month so you know you’ll reach your goal within six months or a year.
3. If You Need to Finance, Do It Wisely
Send me a Home Insurance Quote Cape Cod Massachusetts -Some projects, such as a leaky roof or broken furnace, can’t wait. If you need to finance, look for the lowest interest rate and don’t treat the loan like “free money.” Spend only what you have to and then make a plan to pay the loan back early if possible.
4. Prepare for Surprises
Even when you do everything right, construction projects and remodels are notorious for going over budget. Leave a cushion in your budget for last-minute surprises so you won’t have to go into debt or pull from other areas.
5. Check Your Coverage
Of course, preparing for surprises and avoiding unnecessary expenses also means having adequate homeowners insurance in place.
If you're unsure about your coverage or want to review your current policy, reach out with your questions anytime.
The juggle of work and home life has taken a different form for those of us who are practicing social distancing recommended by the Centers for Disease Control (CDC) during the coronavirus (COVID-19) pandemic. For working parents of school-age children, this means finding ways to keep children safely occupied while performing their job responsibilities, as they work from home (WFH).
Here are six key tips:
1. Expect Changes in Your Work Schedule
By now, you may have noticed that your typical workday schedule is no longer typical. Younger children will require more hands-on help in getting their day started, while teenagers can be more independent and may even be helpful in managing household tasks while you work. The blending of family and working from home is an opportunity to teach responsibility, even in small doses, so you can tend to the work assignments on your plate.
2. Help Your Kids Establish a New Routine
To differentiate work and playtime, help kids set their own routine. If they’re working on school assignments, having them sit down at the same time each day can help provide structure during this uncertain time. Let them know that you’ll be available for help and set aside specific times for fun activities you can do together.
3. Double-Check Home Safety Measures
If your younger children will be out of your sight at home while you’re working, make sure you’ve taken steps to childproof your home to prevent accidents. After cleaning your home, be sure to store cleaning supplies out of reach of young children. If you have a home security system, set up a notification to alert you when a door or window is opened.
You’ll also want to take care of yourself by making sure your home office is comfortable and organized in a way that helps limit potential problems, such as overuse injuries.
4. Reset Your Expectations
Working from home with kids may impact your ability to focus, particularly in uncertain scenarios like the COVID-19 pandemic. Give yourself permission to adapt your work style, realizing that it may take you twice as long to compile a report or finish a project. Working from home means family needs are perhaps just a room away. Strive for balance by arranging your days to fit in all the important tasks you must attend to for both your family and your job.
If you can take a break on a beautiful day, get out in the yard with your kids. You’ll appreciate the moments of escape spent with your family.
5. Stock Up on Fun and Games
While you’re searching online for paper goods or hand sanitizer, add a few art kits or video games to your shopping cart. Now may even be the time to purchase that new gaming system you planned to buy as a special gift. Set parameters around screen time, but realize there may be instances where a little extra play is okay if your kids are having fun and you’re on the verge of completing a task for work.
You may also want to stock up on craft supplies that can come in handy when you need a quick, easy distraction for your kids in order to give you the time you need to meet an impending work deadline.
6. Trust Your Parental Instincts
You know your kids better than anyone. If they’re struggling to adapt to this new situation, they may require more of your attention right now. This means you may need to find ways to shift around work responsibilities. If you have a partner who is also working from home, maybe you can agree to trade off child care duties to ensure that your family’s needs are being met.
Right now, your main priority could be just making it through the day and keeping your family healthy. But, it’s also important to work and provide for your family’s financial needs. Communicate with your co-workers and managers as you adjust your work-life balance.
Consider Whether Your Insurance Needs Have Changed
If you’re moving to a home-based business or using office equipment at home, you’ll need to understand how this fits into your homeowners policy. If you have any questions or concerns, don’t hesitate to contact your insurance agent.