Creating an outdoor living space with resale value

Dear Dave,

My wife and I have been in our new home for about a year now. We are considering, putting in a hot tub.

We have a couple of different options to locate the hot tub and wanted your advice. One idea would be to put the hot tub on the small patio that is off our master bedroom. However, that would be the only access and we aren’t sure that is a good idea. The other option is to put it on our patio off the dining room - which would definitely be a more central location, but not as secluded.

Do you think it makes a difference for future resale potential? And if so, what do you think is best? Thanks for your feedback!

Joe and Sydney, Grand Junction

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Joe and Sydney,

Making improvements on your outdoor living space is always a smart move! For resale it is hard to beat the bang for your buck of outdoor home improvements.  Outdoor living spaces are very in vogue and there is little that lights the fire of a home buyer like a really well done outdoor living area. One thing to keep in mind is that hot tubs are a bit like pools, people either really like them or they really don’t and there generally is not much in between. If you simply add a hot tub to an existing deck or patio your financial return will likely be quite underwhelming, however creating a truly amazing outdoor space will add real money and end up being a real selling point when and if you ever decide to sell. All that being said, there are a couple of things you can do to maximize the space and the improvement.

“First, concentrate on making the space not just a hot tub space. Make the effort and spend the time to create a space that provides not only a home for your hot tub, but a space that creates an atmosphere and ambiance of a true outdoor living area.”

First, concentrate on making the space not just a hot tub space. Make the effort and spend the time to create a space that provides not only a home for your hot tub, but a space that creates an atmosphere and ambiance of a true outdoor living area. Marry your hot tub with a multi-purpose area that serves as an entertaining or sitting area and see the impact soar. I am not sure it matters if you situate the hot tub off master bedroom or off the dining area if you really create something wonderful. Both locations will have their appeal, if you go off the master you probably want something a bit more intimate and private and if you decide to locate off the dining area you want to shoot for making it conducive to entertaining. On another note, make sure to add the extra element of lighting to your area. Lighting is a far too often overlooked as a very inexpensive item that provides high impact and is essential when trying to create a mood and ambiance. If you go the extra mile and enhance your landscaping to accentuate the new hot tub/entertaining area and you should be well on your way to creating a space that many hot tub lovers and even those who are not will covet!

Tomorrow is Memorial Day and I encourage everyone who is reading this article to stop for a few minutes and remember those who served in our armed forces and paid the ultimate sacrifice. Without their sacrifice it is likely the world we live in would be much different and not nearly as good…Personally I am very thankful.

Dave Kimbrough
The Kimbrough Team

Tips for Downsizing Your Home

Dave,

We have been living in Grand Junction for nearly 12 years and when we moved here we had our 3 children living at home and our lifestyle required much more space, inside and out, then it does now that they have moved out. We are in our late 50s and have a large home on several acres and we need to downsize our home and land, as it has become way too much for us to keep up with. First, is this a good market to down size in? Second, we are struggling with where to begin. We have so much stuff that has accumulated over the years that the process is very daunting. Any words of wisdom you could offer would be greatly appreciated.

Thanks.

William and Barb, Grand Junction    

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William and Barb,

Downsizing can be a very daunting task that can seem overwhelming as you sit and look at everything that has to be done. I would suggest to create a game plan and timeline for making your move. Break it down and put a realistic timeline on the items that need to be completed and then mark them off as you get them done. This timeline will help make the process not appear so daunting and will give you steps to complete and when you complete them. This will also allow you to see your progress as you mark off the tasks and this will serve as mini rewards as you mark of each step. That being said, it still can be quite overwhelming. Hang in there!

My view on timing, when you buy and sell in the same market, then all things are relative. When your home goes down 10%, so does you neighbor and visa versa.  There is no doubt that 10% of $400,000 is more than 10% of $200,000 and this is probably where you have heard the side of the story that it is a great time to move up, but not necessarily a great time to move down. The question you must ask yourself, how long will it take for the market to come back up? And am I willing to keep slaving away on the large house and land or am I willing to cut ties and make a serious lifestyle change? A quality of lifestyle change is typically worth the trade off of waiting for your property to come up in value, but only you can make that decision. After you have decided if the time is right, the next steps are the one’s that can take the wind out of your sails.

First, assess your current and future space needs. Walk through your home and ask yourself questions about all your belongings. Do you use your exercise equipment? How often do we eat at the dining room table? How many times have we used the sitting room in the past year? If you have a collection of 300 books, do you really need to collect them? Or better yet, are you going to read them again anytime soon? Same can be said for movies, etc... Many times, much of what we have accumulated is kept for those “just in case” moments. "Just in case” moments can lead to a never ending amount of clutter that needs to be thinned out, because “just in case” moments do not come around very often. We keep things around "just in case", or hoping that their presence will eventually encourage us to use them. For the items you really have a hard time getting rid of, make an agreement with yourself and put the items in storage. If you don't need or use them within 6 months, give, sell or throw them away. I bet you find that most of your stuff you do not need. That is when you will realize your space requirements may be much smaller than you originally thought.

“Go out on a home viewing tour and establish if there are homes currently on the market that will meet your new “downsized” needs and living requirements.”

After you have downsized the amount of stuff you have or have a good grasp on what stays and what will go, you need to start looking at replacement homes. Go out on a home viewing tour and establish if there are homes currently on the market that will meet your new “downsized” needs and living requirements. A good rule of thumb, we use, is to go out and view homes and if you can find two or more homes that you would be happy with, then it is reasonable to anticipate you can find a home you will love, once your home goes under contract.

Remember, control the things you can control and try not to eat the cow in one bite! You need to pace yourself and making a game plan with realistic goals will help set you up to succeed and make the process as enjoyable as it can be. I will also warn you, once you start getting rid of your unused stuff, it can be addictive and fun. Have fun with it so you can look back on it as a rewarding experience and setting up goals and crossing them off leads to a positive outcome! Hope this helps.

Dave Kimbrough
The Kimbrough Team

Most valuable upgrades in new construction homes?

Dave,

My husband and I are buying a new construction home and are very excited to build a house we love. We’ve decided on our lot and are about to meet with our builder to decide on some major aspects of the home. Our question for you is what upgrades should we go for? What holds the most value?  High end finishes vs larger square footage?  I’m sure our builder will also have an opinion, but we’d love to hear what you think as well!

Thanks,
Becca, Grand Junction

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Becca,

Great question! There are many aspects to look at when deciding what lot to choose and which floor plan will best fit your family. Remember to start with the basics and work from there. By basics I mean start with which floor plan will work best. 

When choosing a floor plan remember to stick with a few common features that will help retain and increase future value. Some simple things that I believe are here to stay are floor plans with a great room concept design and feature raised or vaulted ceilings, split bedroom concept (master bedroom on one side and secondary bedrooms on the other side of the house), large kitchens, luxury master baths and a 3 car garage. If you are lucky enough to incorporate all these into your floor plan, consider yourself blessed! If you can’t get them all, you will need to prioritize which of these features are most important for your family. Also remember that today’s open concept floor plans live larger than their square foot size so don’t be surprised if a smaller plan lives larger than its actual size. If you are able to find a smaller plan that lives large you can use some of the savings and splurge a little on your finishes. After you have chosen your floor plan, stick with more basics by focusing on how to best position your home on the lot.

“Keep in mind that you will boost your long term value if you position your home on the lot leaving maximum space along the garage side to be used for RV parking. ”

If you have options of how to best position your home on the lot you will want to focus on how to maximize back yard, privacy and RV parking. Keep in mind that you will boost your long term value if you position your home on the lot leaving maximum space along the garage side to be used for RV parking. This is an easy one to miss, but if the lot allows enough room to make RV parking make sure you take advantage of it, as it can be a make or break feature for some buyers. Lots are getting smaller and pushing your home forward on the lot can help create a few more feet in the back yard and even a few feet can make a big difference.  After you have conquered the basics of the lot and floor plan, focus on the finishes!

Picking the finishes for your home is the fun part and this is where you will give your home some personality. When you start picking finishes ask yourself how long you are planning on living there? If you plan on this being your long-term home then you might pick finishes that focus more on what you want and less on what will prove easier to sell when the time comes. If you are planning on being there a few years and then moving up or potentially moving out then you might stick closer to a conservative middle ground than on the edge of new trends! Timeless finishes are wood and tile floors, granite counter tops, neutral carpet and wall colors (maybe with a splash of color on an accent wall). Hard to go wrong with any of these and they are all for maintaining and enhancing future home value. Most importantly have fun with the process and choose things that you love!

Lastly, for all the Mom’s out there enjoy your day! For every person reading this column, take time to thank your mom for all she has done. Remember, without her you would not be here! Happy Mothers Day!!

Dave Kimbrough
The Kimbrough Team

Who gets to keep the earnest money?

Dave,

My neighbor’s home recently was under contract and was supposed to close last week, but we found out it didn’t. Apparently about a week before closing they were notified by their real estate agent that the house did not appraise for the price they were under contract for. The buyers were not willing to obtain another mortgage company or get another appraisal, even if our neighbor paid for the new appraisal. We were really surprised, and so was our neighbor, to find out that the buyer did not even have to forfeit the earnest money. I thought that if the buyer did not close, they would lose their earnest money? If the buyer does not close and they still get their earnest money back, why do you even have earnest money in a contract?

Thanks Dave,
Tom, Grand Junction

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Tom,

The story you described happens more often than you would think and the “what happened to the earnest money?” question is almost always certain to follow! Unfortunately the “what happened to the earnest money?” answer is always very disappointing to the seller and it typically comes as a big surprise that not only will they not be keeping it, but it is going to be returned to the buyer. Sellers beware, in Colorado earnest money does not mean what you think it means. I think you pose a great question, “Why do we even have earnest money?”

“Earnest money is basically considered good faith money that the buyer typically provides to the seller when they present a contract to purchase. ”

Earnest money is basically considered good faith money that the buyer typically provides to the seller when they present a contract to purchase. If the buyer and seller come to agreeable terms on a contract, then the earnest money should be held by either the real estate brokerage or a title company until the time of closing. When things go smoothly (most of the time) this earnest money is used as part of the buyer’s funds to purchase at the time of close. It’s when things don’t go smoothly…they can get complicated in a hurry! Let me make one thing clear about earnest money and Colorado real estate contracts, and as far as I am concerned it is a good rule of thumb to use, unless the buyer’s actions are egregious and ALL of the contingency dates and deadlines in the contract have passed the buyer will almost ALWAYS receive the earnest money back!

Colorado real estate contracts are written with the primary premise to protect the buyer and provide the buyer ample opportunities to figure out exactly what it is they are buying and exactly how they are going to obtain the funds for their purchase. Buyers generally place a contract on a home that they love. They imagine raising their family there, having weddings, prom nights, Thanksgiving dinners and Christmas mornings under the tree in their new home. Buyers typically place contracts on homes they love and when it does not work out they are also very disappointed. Also, keep in mind that when things don’t work out, it is not typically by fault of the buyer or really anyone’s fault. There are many moving parts to any real estate transaction, especially those that involve a loan, and there are plenty of opportunities to hit a “snag” and sometimes those “snags” are too much to overcome.  

The moral of the story here is to not be surprised, as a seller, when you do not get to keep the earnest money if your transaction does not see the closing table. About the only time a seller will receive the earnest money is when ALL of the dates and deadlines have passed on the contract and the only date remaining is the closing date. If the buyers back out after all dates have passed, then that is when they will likely lose their earnest money! Here is hoping that you never have to have to ask the question, “who gets to keep the earnest money?” but if you do at least now you will know the answer before you ask!

Dave Kimbrough
The Kimbrough Team