|Inspections, appraisals, and automated valuation models, while related, all have different functions but can be easily confused. Let’s take a closer look.
Before You Buy, Inspect!
Inspections: A property inspection is ordered by the buyer and is meant to be an unbiased look at the condition of the property. While not necessarily required by a lender, an inspection protects the buyer from purchasing a home that requires expensive repairs or otherwise doesn’t live up to its list price. A property inspector will examine the condition of the property inside and out, running through a checklist of areas including, but not limited to, the roof, electrical panels, wiring, plumbing, appliances, doors and windows. If any issues pop up, the inspector makes note and provides the buyer with a report.
Many reported issues will need some attention but won’t affect financing. If major repairs are needed however, the lender might want to have those issues addressed before they provide any funding.
When you make a written offer on a home, you should insist that the contract state that the offer is contingent on a home inspection conducted by a qualified inspector. You will have to pay for the inspection yourself, but it could keep you from buying a house that will cost you far more in repairs down the road. If you are satisfied with the results of the inspection, then your offer can proceed.
During the Home Inspection
Appraisals: Once the inspection has been completed and reviewed, the lender can order an appraisal. The appraisal will consider comparable homes in the area as well as other factors such as lot size, nearby schools and crime rates. The goal of the appraisal is to determine the true value of the property for the sake of the lender.
The key difference between an inspection and an appraisal is that an inspection aims to assess the physical condition of a home itself, while an appraisal solely determines the market value of the real estate.
AVMs: An automated valuation model is a digital evaluation of the value of a home. An AVM will quickly research the database of similar homes in the area and compare them with the value of the subject property. AVMs are often used to assess the value of a property portfolio, and have the advantage of saving time and money since no one physically visits the property. However, AVMs can’t take into account the true condition of a property, are only as good as the data the model selects for valuation, and often aren’t enough to secure a conventional loan for a home buyer. AVM’s are notorious for misinforming the public so be sure to follow up with a Realtor to affirm the information you are receiving from an AVM.
REAL ESTATE NEWS
Brought to you by Theresa Harden, SFR ePro Realtor
Not ready to buy a home for yourself but want to take advantage of great market conditions? Consider buying an investment property! It’s a trend that’s taking over real estate, as savvy investors look to put their money in an appreciating asset. Here are five reasons to consider it.
1. Rates are crazy low. Lower rates mean more affordable lending, or more for your money if you choose to reach higher.
2. Because it will appreciate. According to CoreLogic, “The overall home price index (HPI) has increased on a year-over-year basis every month for seven years.” The long-term price appreciation of real estate can provide one of the safest investments out there.
3. Because passive income is good. Yes, it’s nice to know there will likely be appreciation over time, but the real key to success with investment properties is passive income.
“The best part about rental properties is that they provide a stable income,” said Mashvisor. “What would be better than having a check sent to you every month? In order to have positive cash flow, you have to make sure you invest in a profitable rental property.”
4. To turn it into a short-term rental. The short-term rental market has opened up a new world of opportunity for investors. By buying in the right location—by the beach, near a university, or in close proximity to a popular annual event, you have the potential of making a significant return in a short period of time. Just be sure to check the local laws, as Honolulu has been cracking down on Airbnb and other services.
5. Because it can help you buy the home of your dreams down the line. “Buying an investment property before your first home does not imply that you won’t have the funds to purchase your actual home at some point,” said Mashvisor. “In fact, investment properties that have been purchased wisely and have grown in value can offer you a sizable amount of wealth and equity.”
Starting the home buying process means navigating many stumbling blocks; it means saving every cent, finding the right real estate agent, and scouring homes online in your free time. You might not mind a property within your budget needing a little TLC to make it your own, or maybe you want something completely move in ready. Fortunately for you, your real estate agent has helped you narrow down your choices and can help guide you toward what’s best for you.
During the house hunting experience, you may come across a property or two that pique your interest but also give you some cause for concern. Your agent knows the right questions to pose to the seller’s agent, and even before you view the property you can review the seller’s disclosure documents together (when available). Your agent has an expansive knowledge of the industry and is connected to other industry professionals to help you along the way. Unfortunately, there can be a few more hurdles to overcome. Since two heads are usually better than one, before you sign on the dotted line, let’s look at a few common red flags.
Odors– If something doesn’t quite smell right, ask about the source of the odor. In older homes, especially in the country, there may be animals living in the walls. If you walk into a basement and get assaulted by a musty odor, it could be a sign of costly water damage. Alternately, if it smells excessively fragrant, many candles are lit or air fresheners used, the pleasant smell could be an attempt at masking something far worse.
Pests– Like animals in the walls, there can also be insects or rodents in the home. Pests can be a significant issue not only for the damage they cause, but also because they aren’t easily spotted. Look for droppings in or around the kitchen or bathroom floor, as well as signs of nesting like scraps of paper or bits of string or ribbon.
Paint– Seeing new paint in a home is not necessarily a red flag, however, if you notice one painted wall or area amidst others which have not been painted you may want to bring that up with your agent. Sometimes paint is used to cover water marks or other damage for a quick sale, and the buyer is left facing a bigger issue down the line.
Shoddy Repairs – In some cases homeowners may feel they have the experience to do home repairs themselves when they should have called a professional. Bringing along a trusted professional (such as a contractor, plumber or electrician) to a showing can make all the difference. They can point out an amateur fix and give you a good idea of what else might need fixing.
Electrical Issues– Check all plugs and switches. If lights flicker, the switches or outlets are warm to the touch, or the outlets look original to a home older than you, those can end up being costly updates to make.
Now that you have an idea of some things to look for during this process, hopefully you feel a little more at ease. Once you’ve found a home that meets your expectations, your agent will work with you on next steps like submitting an offer and arranging for a home inspection. A thorough home inspection by a qualified professional may confirm your worries or dispel them so be sure to review his or her report before making a decision. The bottom line is that buying a home should be an accomplishment to look forward to with transparency and far less stress. Luckily for you it can be with the right representation.
The terms “foreclosure,” “short sale,” and the acronym “REO” tend to get a bad rap in real estate. Be it inexperience or misunderstanding, because people aren’t sure what each stand for, a great deal of agents and homebuyers steer clear of these kinds of sales. Since it isn’t uncommon for misunderstandings to lead to unnecessary fears, let’s remove some of the taboo, and shed some light on these terms so you can decide whether one of these types of properties is for you.
Let’s face it, when many people hear one of these terms, thoughts of a home in complete disrepair with a big red X on the door come to mind, or assumptions about an undesirable neighborhood arise. That’s not always the case. These types of sales are all based on seller circumstances but as we know, misfortune doesn’t discriminate. Sure, you may find a small home in need of new plumbing throughout, but you might also find a gorgeous home with little to no work needed, for which you wouldn’t otherwise qualify. In some cases, if the homeowner can’t afford the mortgage, they may not have maintained the property for years, on the other hand there are also many cases of hardship, where a homeowner becomes ill or loses a job and can no longer pay their mortgage for the home in which they’ve done nothing but take pride.
Foreclosure – When a homeowner is no longer paying their mortgage, and the loan becomes delinquent, the bank or lender will contact the owner to see if they’re able to pay it off in full. If they cannot, the process starts with a Notice of Foreclosure where the lender will take possession of the property to sell it and recoup as much of the debt as possible. A foreclosure dramatically affects the borrower’s credit score and stays on their credit report for seven years. Foreclosures are sold at auction, of which the procedure and laws vary by state and country. For example, in Massachusetts the auction is held at the property location, while in Florida they’re usually held at the county courthouse. Foreclosure homes are typically sold “as-is” or “sight unseen,” meaning that the mortgager will not be paying for any updates or repairs and the buyer will not be able to inspect the property prior to purchase. Foreclosures are also typically paid in cash to avoid financing contingencies and hasten the process. To get a better idea of what the laws are where you live, check here if you live in the U.S. In Canada foreclosures are less common due to stricter lending requirements, and the preferred process that keeps the lender from involving the court system is called Power of Sale.
Short Sale – With a short sale, if a homeowner is having trouble paying their mortgage and they owe more than what they can get for it through a sale in the current market they, or a representative for the borrower, contact the lender to see if they qualify for this option. The lender will ask for information to begin a short sale package which includes financial statements and a hardship letter from the seller. This process is less damaging to the seller’s credit score and usually shows that the seller took responsibility by trying their best to get the lender’s money back. If they haven’t already done so, the seller will find a real estate professional to list the property. The real estate agent must disclose that “the terms are subject to the mortgage lender’s approval” and usually the property is sold “as-is” due to the seller not having the ability to pay for repairs and the lender not wanting to lose any more money on the property. Contrary to its name, when looking to purchase a short sale property keep in mind that it’s not called a short sale due to the length of time it takes. In fact, it’s the opposite. The term means that the sale price will likely fall “short” of the debt owed on the property. Though purchasing a short sale can be similar to a regular home buying experience, some major differences are the length of time to close, the amount of paperwork involved, and the fact that you’re dealing more with the lender than the seller as they need to be the ones approving the offer.
Real Estate Owned (REO) – This type of property is not sold at a foreclosure auction; the bank already owns it. Often during a foreclosure auction the lender sets the price trying to recuperate not only what is owing on the home, but also the interest and legal fees that have accrued, which can take the price far over fair market value. This can sometimes deter bids, so the property remains in the bank’s possession. The bank will then hire a broker to help sell the property, which could come to market at a discounted price or with incentives like a reduced down payment or faster approval.
REOs are not always a bargain, as the banks are looking to make money. If you’re purchasing one, use the services of an experienced real estate agent who will check the title or deed that serves as evidence of ownership, and recommend you get a home appraisal and inspection.
Now that you know there isn’t a condemned property behind every door with these types of sales, there might be a little less trepidation, right? Whether you want to purchase one of these property options or you’re still on the fence, know that these types of sales come with baggage and are not for everyone. Some are the stuff of dreams for home flippers or investors who can budget for worst case scenarios based on square footage, others can be the perfect financial opportunity needed for first-time homebuyers to break into the market. Either way, with the right, experienced real estate professional working on your behalf, a foreclosure, short sale, or REO property might be perfect for you.
Whether you are on the market for your first home or you’re an empty nester ready to make a change, an important question to ask yourself is, “How much home do I really need?” The answer can lead to finding exactly the right property for the next chapter of your life. Here are a few points to consider before starting your search.
Lifestyle – Does your life revolve around working at the office and spending nights out with friends or are you more of a home body? If you don’t spend much time there, does it make sense to buy a large home? Maybe you are somewhere in between. Think about how you spend your time and what you like to do. If you have a large extended family and would love to invite them to your home regularly, maybe a little more space makes sense.
Number & Use of Rooms – This point may seem simple, but consider your current circumstances as well as what the future may hold. Maybe there are only two of you now, but if you’re looking to start a family, that could impact the number of bedrooms and bathrooms you might need down the road. Also, would you use all of the bedrooms as such, or do you work from home and need a space where you can shut out the rest of the hustle and bustle?
Affordability – Typically the larger the home you purchase, the more expensive it will be. That isn’t only true initially, but also when maintaining, furnishing, heating and cooling it. The size of your home impacts the property tax you’ll pay as well.
Be Realistic – Sure, it might be nice to have a personal gym or a designated play room, but how often will that space be used? Also, think of what you are willing to do around the house. Do you want to clean every square foot or will you resent some of this extra space? Likewise, if you are constantly bumping shoulders while brushing your teeth with your partner you might not be thrilled you opted for less space. Create a list of priorities and make sure they are reasonable for you and your family or circumstances.
If you constantly entertain, already have a large family, or you like room to spread out then a big home is probably right for you. If you spend a lot of time away from home or prefer a more minimalistic way of life, maybe a small home is where you belong.
REAL ESTATE NEWS
Brought to you by Theresa Harden, R
Down Payment Dilemma: How Do You Know How Much to Put Down on a Home?
For many prospective home buyers, the down payment is the most daunting hurdle in the race to buy a home. Even for people with decent credit and a healthy paycheck, the down payment can be the great home ownership killer.
The big question for all prospective buyers is: how much should my down payment be? Most lenders will tell you that 20 percent is the standard, but is that really necessary?
The short answer is no, but of course there are some caveats.
“It’s a myth that all home buyers must have a 20 percent down payment to buy a home,” says Nancy Herrera-Siples, a Riverside, CA, branch manager at Primary Residential Mortgage. So why all the fuss over having 20 percent to put down? “Because if you don’t, it usually means you’ll have to shell out money for either private mortgage insurance (PMI) or government insurance, which is usually financed by the Federal Housing Administration,” according to Herrera-Siples.
Still, when a low down-payment is your only option to buy a home, PMI might literally be a small price to pay. Remember that PMI goes away eventually when your loan balance is 80 percent or less of the home’s value. If you’re in an area where homes are rising in value, this could happen sooner than you think.
Here are a few reasons to go high… or low.
When to make a substantial down payment:
- When you’re looking to keep your monthly payment as low as possible and have cash to spare.
- When you’re approaching retirement age and can envision a reverse mortgage sometime down the line.
- When the interest rate is lower with a higher down payment. “The more you put down, the better position you are in for negotiating a lower interest rate,” says Credit.com.
- If you’re worried about being underwater. If the market should drop in your area, you run the risk of owing more than your home is worth.
When to go low:
- When you don’t have the funds for a higher down payment and can’t earn or borrow them quickly enough.
- When the rate on your FHA or Fannie or Freddie loan is comparable to that you’d get with a higher down payment.
- When you need to escape a high-rent situation and the monthly payment on a house is lower than what you’re currently paying, even with the PMI factored in.
- When you’re confident your home will appreciate quickly, allowing you to refinance and get rid of PMI quickly.
You’ve been looking at homes to buy and think it might be a good idea to find one in need of a little TLC. You’re handy, the place has great bones, and those shows on television make the process look so simple. Whether you are on the market for a home that you can make your own or you’re looking to invest or flip, here are some points to keep in mind before getting fitted for a hard hat.
- Be Honest – Know what you can do and delegate the rest. If your idea of being handy is hanging pictures that are “almost” level, you might be better off working on the design aspect of the process. You’re spending your own time and money so you can be as adventurous as you want, but at least opt for a professional to do the electrical and plumbing work otherwise you might face very dangerous and expensive learning experiences.
- Do Your Research – If there is a property that stands out to you and you already know what needs to be done (maybe the kitchen needs new cabinets and appliances and the bathroom needs to be re-tiled) start pricing out project items at local retailers. If you are looking to stay on the lower side of the budget, big box stores may be the way to go. You may also want to view homes with your contractor so he or she can give you an idea of the cost of things you might have overlooked. Make sure you are working with someone you know and trust, or someone reliable who has been recommended by a friend, family member, or trusted third party.
- Set a Budget – Some people set an all-inclusive budget while others may have a specific purchase price in mind for the property with another amount set aside for labor and materials to fix it up. Remember that surprises happen, sometimes more often than you’d like, so be prepared and set a buffer of 10% to 20% aside in your budget for just that.
- Know When to Compromise – After setting a budget it’s a good idea to make a list of the things you know you want for the home and another list of the things you can live without. Maybe you’ve always wanted a farmhouse sink in the kitchen and in order to get it, you can compromise on the center island. If you are renovating your own home, do what means the most to you. If it’s an investment property research which improvements could increase the property’s resale value. This article on The Balance’s website entitled The Best Home Improvements to Add Resale Value is a good place to start.
- Timing is Important, Not Definite – You’ve set a schedule and you want to stick to it, although it may not always be realistic. Whether you’ve bought the home for yourself and are living in the chaos of a remodel or you’ve invested and every month another mortgage payment is chipping away at your proposed profit, any delay can be daunting but it’s something for which you should be prepared. Sometimes the work can take longer than you’d think or maybe something completely out of your control arises like obtaining a license or permit. Either way be sure to set aside extra time and patience because things don’t always go as planned.
Renovating a property may not be as simple as it looks on those remodeling shows but if tearing down walls and creating something beautiful is what you love, you should do it. With a little help, a lot of hard work, and some realistic goals, your reno project could rival anything you see on TV.
Real Estate News
By Tim Harris
The Age of Sharing is here, and it’s a phenomenon that’s expected to grow from $15 billion in 2014 to $335 billion by 2025, with services such as home-sharing and maintenance platforms being a big part of that equation. Many homeowners have seen big economic benefits over the years from home-sharing platforms like Airbnb, but if you’re thinking about jumping in to get a piece of that pie, there are a few things you should consider first.
Know Your Regulations
Not all cities see the home-sharing phenomenon as a win-win. Many municipalities are passing new regulations that are often designed to curb its growth. Before signing up for a service like Airbnb, you should find out a few things. Does your city have a framework for short-term rentals? Are there any legal restrictions? How expensive is licensing?
This is critically important, because ignoring licensing regulations can be very costly. In Portland, Oregon for example, the city implemented fines of $1,000-$5,000 per violation for home-sharing operators. In 2017, it collected over $70,000 in fines and fees from a single operator who was found to be in violation of the city’s regulations.
Know Where You Live
Cities are made up of distinct neighborhoods, and people are proud of where they live, so, you’ll want to think carefully about the impact of a short-term rental on your neighbors before moving forward with your plans. Will the locals have to compete with guests for on-street parking? Will they feel less secure with strangers coming in and out?
You don’t need to get permission before renting rooms, but as a courtesy, you’ll want to let anyone impacted by your decision in on your plans. You’ll also want to establish clear house rules and expectations, especially about noise or late-night outdoor socializing, for your guests.
Know Your Coverage
You’ll hear horror stories in the news regularly about a home-sharing rental gone bad. In London, a short-term renter threw a party for 100 people, unbeknownst to the homeowner, during which floorboards were ripped and a television pulled off a wall. In another widely-reported example, a short-term rental unit was used as a pop-up brothel. Stories about experiences as bad as these are extremely rare; however, they serve to remind us about the financial and legal risks for hosts who allow strangers into their home. It’s important to make sure you have the appropriate coverage if you don’t already have it.
Home-sharing companies such as Airbnb or HomeAway offer basic insurance coverage, but what they offer may not be enough, or could be severely limited by exclusions. Your best option is to ask your insurance provider about the nature of the protection, liability coverage and deductible. For example, if you’re renting out rooms at your primary residence, short-term, on a regular basis, it may be considered a home-based business, and you could be denied coverage.
Hawaii Dream Realty LLC specialized in sales, marketing, exchange, and management of investment properties. For more information on our services visit www.invest808.com or for more information on our short term rental properties visit www.WaikikiStay.com. Hawaii Dream Realty LLC is an independently owner and licensed real estate brokerage.
Hawaii Dream Realty LLC is committed to preserving the ‘aina and Hawaiian values as well as the importance of spirituality in our everyday lives. Our company has worked hard with the Kuhio Village and neighboring communities to spread the spirit of aloha and provide for a positive and rewarding experience for all our guest, customers and clients.
The blessing of Kuhio Village by Kumu Karen Leialoha Carroll and her father was greatly appreciated by Theresa Harden, Principal Broker, and her Staff, as well as the residents of Kuhio Village. Kumu Carroll provides inner peace and guidance through her words of wisdom, her spiritual chants and prayer. Mahalo nui loa to Kumu Karen Leialoha Carroll and her father for creating an unforgettable moment and connecting us with our community.
Click on the photo to open the flickr album of pictures taken during the blessing of Kuhio Village on April 21, 2017. The blessing begins with the Hawaii Dream Realty LLC office and progresses through the lobby area and grounds of Kuhio Village.
What we do and where we are going
We are pleased to reveal our newly designed vacation rental marketplace website for Hawaii Dream Realty LLC, feel free to Take a Peek! We have worked hard to grow Hawaii Dream Realty LLC from a single dimension real estate brokerage operation to a franchised company more robustly able to provide for our Client’s real estate needs. The company utilizes enterprise systems for each of its business lines with the goal to maximize returns, increase property value, reduce risk and stress, save time and money, and ultimately to provide piece of mind to our Clients.
The company already employed proprietary systems for marketing and managing real estate transactions through our affiliation with EXIT Realty Corp International. Hawaii Dream Realty LLC, doing business as EXIT Real Estate Services, specializes in the procurement and exchange of investment properties.
Today, Hawaii Dream Realty LLC is comprised of a number of business lines that have been developed in direct response to the needs of our Clients. Together they provide our Clients with a total real estate investment solution. For the first time we have dedicated websites and back office support systems that reflects each service line.
The vacation rental marketplace is the consumer end of an enterprise system that expands the ability for Hawaii Dream Realty LLC to manage and market our Client’s investment properties zoned for short term accommodations. Our new website, aside from being aesthetically pleasing, provides an agile and easy to scan, read, and navigate interface for its users enabling visitors to find their accommodation wants quickly.
One of our primary objectives we wanted to achieve when designing the new site was to help visitors get to know us better and get a feel for who we are as a company and vacation services host. We employed a responsive, security-conscience design, which means that you’ll see essentially the same design and secure interface optimized for your smart phone, tablet or desktop.
We hope you will visit the new website at our new address, www.waikikistay.com and acquaint yourself with the many options we offer when it comes to vacation rental properties for Waikiki. The company has its office located in the heart of Waikiki on the beautiful Hawaiian Island of Oahu. The vacation rental accommodations are within a three block radius of the office and have immediate access to everything that is Waikiki from its dining, street entertainment, to its beautiful beaches and parks, and even a zoo and an aquarium.
We are quite proud of the site, but we know there is still work to do. In the coming months, we plan to continue to expand our online marketing to additional third party vendor sites increasing the online exposure of our Client’s properties.
The Federal Managers Association, established in 1913, is the oldest, largest, most influential association representing the interests of the 200,000 executives, managers, and supervisors serving in today’s federal government. At the October 24, 2013, FMA Chapter 19 General Members Meeting, Theresa discussed investing in Oahu’s real estate market.
Mahalo to Federal Managers Association Chapter 19 for inviting me to speak at their General Members Meeting. I really appreciated all the interest and questions. Best wishes to Chapter 19 and all Federal Workers.
WORKING WITH A REAL ESTATE BROKER
Important Information for Anyone Planning to Buy or Sell a Home
If you’re planning to buy or sell a home, most likely you’ll soon meet a real estate broker or salesperson. There are many services a broker can offer you without making an obligation but before long you should discuss broker representation. It’s the first thing you need to know about buying or selling a home.
Most people buy and sell only a few homes in a lifetime, usually with quite a few years in between each purchase. Even if you have done it before, laws and regulations change. REALTORS handle hundreds of real estate transactions over the course of their career. Below are some compelling reasons why having an expert on your side is critical.
A Guide For Getting Your Affairs In Order
Being a home owner comes with added responsibility, particularly, as your home becomes a financial asset. After all, if you don’t already own your home, you will eventually pay off that mortgage.
But sometimes life deals us with traumatic blows and our future plans do not necessarily work out as we may have envisioned. The fact remains that we will not live forever. Some of our deaths will be anticipated while others may be completely unexpected. We can do much to alleviate at least some of the suffering our survivors will go through when our day comes.
Make it easier for loved ones to put their hands on important information in the event of your death or sudden incapacity. Although many of us are efficient in our daily lives and keep meticulous records in our professions, most of us leave inadequate and incomplete records of our economic and personal affairs when we die.
How your estate will be settled are many questions that must be answered. Take some time from your busy schedule to gather the personal details suggested in this guide titled “What My Family Should Know“. The guide will help you record the necessary facts for your family, your attorney and your executor. Then place the completed guide in a safe and secure place that is accessible to those closest to you. I wish you a fulfilling life with much happiness and love and hope you find this guide helpful to you and your loved ones. As always, if you ever need any assistance with your Oahu real estate, I am just an email or phone call away, and I am always willing to listen, and when appropriate, offer advice and help.
“Home buying Could Soon Beat Renting” was the title of an article by John W. Schoen, Senior Producer of The Bottom Line on msnbc.com. The Bottom Line is known for breaking news and analysis of real estate and consumer issues.
John writes that “falling home prices have sent many would-be buyers to the sidelines. If all goes well, record low interest rates and rising rents may soon prompt some of them to take a second look at buying.” Historic, US Census Bureau, data on median monthly mortgage payments and median monthly rent payments depicts how affordable home ownership has become.
Unfortunately, that’s a big “if,” according to Paul Diggle, Housing Eeconomist at Capital Economics. Much of the decision to buy a house still depends on your personal finances and preferences, your career or family life, or level of financial security. But if you’re comparing just the cost of owning and renting, buying a house may soon be the better choice, according to Diggle.
Until recently, home ownership was no bargain compared to renting, according to the analysis. A 33 percent drop fall in median home prices, a plunge in mortgage rates and 15 percent rise in rents since the housing crash has evened the scales. Today, the median monthly mortgage payment of about $700 has fallen to about the level of a median monthly rent check. If mortgage rates keep falling and rents keep rising, the equation will tip even further toward owning.
But that analysis doesn’t include the total cost of owning versus renting. A full accounting includes closing costs, maintenance, insurance and property taxes, tax savings from mortgage deductions, gains or losses from home equity, among other factors. Renters have to think about broker fees and future rent hikes. Both have to make assumptions about future trends in housing prices and rents.