Trying to Sell a Home with Tenants Still Living Inside? These 3 Tips Will Make Your Life Easier

 

Are you thinking about selling a home that you have rented out for some additional revenue? If so, you’re likely trying to discern how to best inform the current tenants and conduct the sales process in a way that works well for all of the parties involved. In today’s blog post we’ll explore how to sell your home while you’re renting it out to tenants and share three tips that can make the process a bit easier.

 

#1: Review Local Laws and Your Tenancy Agreement

 

First, you’ll want to break out your tenancy agreement and download any state, provincial or municipal laws that apply to landlord-tenant relations. Selling a home with renters living in it can result in a number of sticky situations. You’ll want to ensure that you conduct yourself in accordance with the rule of law as you may end up in court if the process goes sour.

 

#2: Communication is a Vital Part of the Process

 

Next, you’ll need to ensure that you’re communicating with your tenants every step of the way. Meet with them to let them know that you would like to place the home on the market, and explain how the sales process is going to work. Allow your tenants to ask questions and to state their case as they may be willing to buy the home from you if they can afford it. Be polite but firm; you don’t want to encourage any hostility but this is your property and ultimately, your decision.

 

Don’t forget to fully inform your tenants as to how home showings will work, as they’ll likely be concerned as to who is being provided with keys to their home.

 

#3: Incentives Can Sway an Unruly Tenant

 

Finally, if you’re faced with some unruly tenants that are making the sales process challenging you may find that financial incentives to help the process go smoother. You’ll need their cooperation in keeping the home relatively clean and tidy, so you may want to consider offering some gift certificates or paying a portion of the rent in exchange for their help. If you’re hosting an open house over a weekend, offer to put their family up in a nice hotel somewhere in town where they can enjoy a weekend together.

 

While selling a home with tenants living inside is rarely easy or fun, it’s certainly doable. When you’re ready to learn more about the home selling process, contact your local real estate agent as they can share their expertise and guidance to ensure you get the most from your sale.

7 Smart Strategies for Kitchen Remodeling

Follow these seven strategies to get the most financial gain on your kitchen remodel.

Homeowners spend more money on kitchen remodeling than on any other home improvement project. And with good reason: Kitchens are the hub of home life and a source of pride.

A significant portion of kitchen remodeling costs may be recovered by the value the project brings to your home. A complete kitchen renovation with a national median cost of $60,000 recovers about 67% of the initial project cost at the home’s resale, according to the “2015 Remodeling Impact Report” from the NATIONAL ASSOCIATION OF REALTORS®.

The project gets a big thumbs-up from homeowners, too. Those polled in the “Report” gave their new kitchen a Joy Score of 9.8 — a rating based on those who said they were happy or satisfied with their remodeling, with 10 being the highest rating and 1 the lowest.

To maximize your return on investment, follow these seven strategies to keep you on budget and help you make smart choices.

1. Plan, Plan, Plan

Planning your kitchen remodel should take more time than the actual construction. If you plan well, the amount of time you’re inconvenienced by construction mayhem will be minimized. Plus, you’re more likely to stay on budget.

How much time should you spend planning? The National Kitchen and Bath Association recommends at least six months. That way, you won’t be tempted to change your mind during construction and create change orders, which will inflate construction costs and hurt your return on investment.

Some tips on planning:

Study your existing kitchen: How wide is the doorway into your kitchen? It’s a common mistake many homeowners make: Buying the extra-large fridge only to find they can’t get it in the doorway. To avoid mistakes like this, create a drawing of your kitchen with measurements for doorways, walkways, counters, etc. And don’t forget height, too.

Think about traffic patterns: Work aisles should be a minimum of 42 inches wide and at least 48 inches wide for households with multiple cooks.

Design with ergonomics in mind: Drawers or pull-out shelves in base cabinets; counter heights that can adjust up or down; a wall oven instead of a range: These are all features that make a kitchen accessible to everyone — and a pleasure to work in.

Plan for the unforeseeable: Even if you’ve planned down to the number of nails you’ll need in your remodel, expect the unexpected. Build in a little leeway for completing the remodel. Want it done by Thanksgiving? Then plan to be done before Halloween.

Choose all your fixtures and materials before starting: Contractors will be able to make more accurate bids, and you’ll lessen the risk of delays because of back orders.

Don’t be afraid to seek help: A professional designer can simplify your kitchen remodel. Pros help make style decisions, foresee potential problems, and schedule contractors. Expect fees around $50 to $150 per hour, or 5% to 15% of the total cost of the project.

2. Keep the Same Footprint

Nothing will drive up the cost of a remodel faster than changing the location of plumbing pipes and electrical outlets, and knocking down walls. This is usually where unforeseen problems occur.

So if possible, keep appliances, water fixtures, and walls in the same location. Not only will you save on demolition and reconstruction costs, you’ll cut the amount of dust and debris your project generates.

3. Get Real About Appliances

It’s easy to get carried away when planning your new kitchen. A six-burner commercial-grade range and luxury-brand refrigerator may make eye-catching centerpieces, but they may not fit your cooking needs or lifestyle.

Appliances are essentially tools used to cook and store food. Your kitchen remodel shouldn’t be about the tools, but the design and functionality of the entire kitchen.

So unless you’re an exceptional cook who cooks a lot, concentrate your dollars on long-term features that add value, such as cabinets and flooring.

Then choose appliances made by trusted brands that have high marks in online reviews and Consumer Reports.

4. Don’t Underestimate the Power of Lighting

Lighting can make a world of difference in a kitchen. It can make it look larger and brighter. And it will help you work safely and efficiently. You should have two different types of lighting in your kitchen:

Task Lighting: Under-cabinet lighting should be on your must-do list, since cabinets create such dark work areas. And since you’re remodeling, there won’t be a better time to hard-wire your lights. (Here’s more about under-cabinet lights.) Plan for at least two fixtures per task area to eliminate shadows. Pendant lights are good for islands and other counters without low cabinets. Recessed lights and track lights work well over sinks and general prep areas with no cabinets overhead.

Ambient lighting: Flush-mounted ceiling fixtures, wall sconces, and track lights create overall lighting in your kitchen. Include dimmer switches to control intensity and mood.

 

5. Be Quality-Conscious

Functionality and durability should be top priorities during kitchen remodeling. Resist low-quality bargains, and choose products that combine low maintenance with long warranty periods. Solid-surface countertops, for instance, may cost a little more, but with the proper care, they’ll look great for a long time.

And if you’re planning on moving soon, products with substantial warranties are a selling advantage.

 

6. Add Storage, Not Space

Storage will never go out of style, but if you’re sticking with the same footprint, here are a couple of ideas to add more:

Install cabinets that reach the ceiling: They may cost more — and you might need a stepladder — but you’ll gain valuable storage space for Christmas platters and other once-a-year items. In addition, you won’t have to dust cabinet tops.

Hang it up: Mount small shelving units on unused wall areas and inside cabinet doors; hang stock pots and large skillets on a ceiling-mounted rack; and add hooks to the backs of closet doors for aprons, brooms, and mops.

7. Communicate Clearly With Your Remodelers

Establishing a good rapport with your project manager or construction team is essential for staying on budget. To keep the sweetness in your project:

Drop by the project during work hours: Your presence broadcasts your commitment to quality.

Establish a communication routine: Hang a message board on site where you and the project manager can leave daily communiqués. Give your email address and cell phone number to subs and team leaders.

Set house rules: Be clear about smoking, boom box noise levels, available bathrooms, and appropriate parking.

Be kind: Offer refreshments (a little hospitality can go a long way), give praise when warranted, and resist pestering them with conversation, jokes, and questions when they are working. They’ll work better when refreshed and allowed to concentrate on work.

By: John Riha

Keep Up with the Joneses

They’re making a pricey remodeling mistake. You don’t have to.

KEY TAKEAWAYS

Jealous of your neighbors’ new master bath? Who wouldn’t be? It’s got heated floors, a sauna, and a massive whirlpool tub. To be honest, your own bathroom looks like the shower station at the public pool in comparison. And you have been thinking about renovating it. Maybe a sauna isn’t such a bad idea after all. And how about one of thosenew tube lights? Yeah, that’d be cool.

Actually, doing the opposite — resisting the urge to keep up with the Joneses makes you the smarter neighbor. Just ask Michael Kelczewski, a REALTOR® whose client added a spa with a downtown view to his Philadelphia home, which was way out of sync with his urban neighborhood, making the home difficult to sell.

“He liked to sit in the tub with his Belgian ale and look over the city while it was snowing,” Kelczewski says. “But the feature decreased the home’s value significantly. Needless to say, the property sold after a year — with a significant price reduction.”

Renovating your home into the nicest digs in the neighborhood comes with big risks. Best to think twice before replicating the Joneses’ extravagant additions, lest you end up with an over-renovated house that’s undervalued by the market.

Here are the questions to ask yourself before one-upping the neighbors:

Is This Your Forever Home?

It’s hard to believe, but the average American moves 11.4 times, and according to the data-crunchers at FiveThirtyEight, most 25-year-olds still have more than six moves (!) remaining. So, statistically speaking, you’re going to move.

And you’ll need to sell your house when you do. Which means you should think about how any project will affect your home’s value. It’s not as simple as you think. Just because you improve, doesn’t mean you recoup (more details on that coming up — just watch for the tables).

Some people just want to buy a house and turn it into a giant, English estate. That’s your prerogative.
Michael Kelczewski, REALTOR®

On the other hand, you may truly plan to stay put. Newer studies find that today’s first-time buyers want to stay in their first homes longer than previous generations. So if you’re one of the ones bucking tradition, then by all means, do what you want to do without regard to resale value.

“Some people just want to buy a house, and live in it and turn it into a giant, English estate,” says Kelczewski. “That’s fine. That’s your prerogative.” (Although you might want to look into any homeowner association rules.)

But if you’re planning a move anytime between now and eternity, let the Joneses keep a good lead on you in the renovation race. You’ll come out better financially. Guaranteed.

How Does Your Home Rate?

“You don’t want to be the best house in the neighborhood,” says Las Vegas-based Cristine Lefkowitz Jensen, a REALTOR® and former interior designer. Otherwise, literally every other house around you looks like a better deal. It’s only smart to keep up with the Joneses if everyone on your block does. Keep an eye on comparable properties nearby, and use those prices to know how much is too much to invest in upgrades.

“Don’t put in Carrara marble and $80,000 cabinets in a market that won’t bear that selling price,” says Kelczewski. It’s just not smart.

If the average home in your area sells for $500,000, and you purchase a fixer-upper for $400,000, don’t invest more than $100,000 — otherwise you’re wasting cash.

Are You Tempted to Finance Your Project?

As a general rule, taking out a loan for a renovation is a bad idea. Any large-scale upgrades that require begging the bank for cash should get an automatic “no” (sorry!). Even if you know for a fact that the Joneses financed their dream bathroom, that’s just all the more reason to march to your own home ownership drum.

Think about it: Even if the Joneses are increasing their home’s value a bit, they’re also paying interest, which eats into the benefit.

That said, don’t feel guilty about financing smaller, low-risk projects that are sure to increase your equity. For example, upgraded insulation may not be sexy, but according to the National Association of REALTORS’® “Remodeling Impact Report,” its median cost is just $2,100, and it recovers 95% of its value in a sale. So a small loan (that you can pay off quickly) might make sense, especially when you consider the energy savings.

Good bets include:

Project Median Cost  Recoup in $$
New Roofing $7,600 $8,000
Hardwood Flooring Refinish $2,500 $2,500
Insulation Upgrade $2,100 $2,000
New Wood Flooring $5,500 $5,000
New Garage Door $2,300 $2,000
New Vinyl Siding $12,000 $10,000

Have You Done Your Research?

Some projects — like refinishing your hardwood — are no-brainers because they’re relatively small and recoup most of their value in a sale.

[ Should You Refinish Hardwood Floors Yourself? ]

Other, bigger investments, like updated kitchens, are a big draw for future buyers.

Old, dated kitchens are “the number one killer of all deals,” Lefkowitz Jensen says. According to the “Report,” a typical kitchen remodel costs $30,000 and recovers $20,000 in equity. And no, that $10,000 difference isn’t wasted. You’ll love the upgrades while you live there, and get most of your money back when you move. (And enjoy a shorter selling time, too.)

Here are some popular projects and their typical costs. But a REALTOR® will know what’s ultimately best in your neighborhood.

Project  Median Cost  Recoup in $$ 
New Vinyl Windows $15,000 $12,000
New Fiber Cement Siding $19,100 $15,000
New Steel Front Door $2,000 $1,500
HVAC Replacement $7,000 $5,000
Basement Conversion to Living Area $36,000 $25,000
Kitchen Upgrade $30,000 $20,000
Complete Kitchen Renovation $60,000 $40,000
Attic Conversion to Living Area $65,000 $40,000
New Fiberglass Front Door $2,500 $1,500
Bathroom Renovation $26,000 $15,000
New Wood Windows $26,000 $15,000
Closet Renovation $3,500 $2,000
New Master Suite $112,500 $60,000
Add New Bathroom $50,000 $26,000

Another equity-rich option is creating an open floor plan. “Not everyone eats dinner like Norman Rockwell, but that’s how the properties were designed at that time,” Kelczewski says. “Increase the home’s value by knocking down those walls and adding square footage.”

Will Your Project Add Curb Appeal?

Improved curb appeal can increase the price of your home up to 17%, according to a Texas Tech University study, so don’t shirk away from jazzing up your front patio and lawn. So if the answer is “yes,” go with the Joneses on this one.

“That’s 50% of the sale,” says Lefkowitz Jensen. “You only have one chance to make a first impression.”

Get a sleek and modern exterior by replacing your crumbling wooden front door with a gorgeous steel model, which looks stunning and recoups 75% of its cost in a sale, according to the “Report.”

Adding trees and bushes brings dimension to your lawn. Even just maintaining your yard makes a big difference. Additional lighting along the walkway is a worthwhile investment, too — in addition to making your home safer.

Will Your Remodel Bring You Joy?

It’s your retreat, your place. It should bring you joy when you walk in the door. You can’t put a dollar figure on the value of that.

However, the “Report” does give some insight into what projects homeowners are happiest with, regardless of cost. REALTORS® asked some of their clients what renovations brought them the most satisfaction.

Here’s how some popular projects ranked, according to the Report’s Joy Score (with 10 being the highest score); and note that “joy” and “recoup” don’t always pair up like you think they would:

Project Joy Score  Recoup in %
New Fiber Cement Siding 10 79%
Add New Bathroom 10 52%
Complete Kitchen Renovation 9.8 67%
New Roofing 9.7 105%
New Master Suite 9.7 53%
Hardwood Flooring Refinish 9.6 100%
New Wood Flooring 9.6 91%
New Steel & Fiberglass Front Door 9.6 68%
New Garage Door 9.5 87%
Kitchen Upgrade 9.5 67%
New Vinyl & Wood Windows 9.4 69%
Basement Conversion to Living Area 9.4 69%
Attic Conversion to Living Area 9.4 61%
Bathroom Renovation 9.3 58%
Closet Renovation 9 57%
New Vinyl Siding 8.9 83%
Insulation Upgrade 8.7 95%
HVAC Replacement 8.7 71%

“You only have a short time on this earth,” Kelczewski says. “If you want to paint your house purple and put in a hot tub, that’s your choice. It’s your property. Enjoy.” So, yeah, sip that Belgian ale in your new spa. Cheers!

Beware of the Flip

Sparkling new quartz countertops, polished hardwood floors, stainless steel kitchen appliances. Aren’t your buyers lucky? But when sellers are flippers, a good buyer’s rep should help clients engage in some old-fashioned sleuthing.
looking at house with magnifying glass

Before the Great Recession of 2008, housing prices climbed dramatically, and homes sold faster than buyers could gush, “I love that spa bathroom.” Contractors and even handy DIYers got in on the uptick by buying fixer-uppers and improving them in the quickest ways possible, selling them, and reaping the profits. Enter the real estate phenomenon of flipping.

The trend waned a bit as the housing market hit the skids, but then returned with some significant differences. Today’s flippers are more often professional investors with access to cash as banks tightened mortgage loan guidelines and available work crews, says Seth Captain, managing broker of Captain Realty in Chicago.

But now, Captain notes changes: “Low inventory and many buyers’ eagerness for new construction and remodeled homes has caused some buyers not to do enough checking,” at least in Chicago, he says. And some buyers don’t insist on an inspection if sellers won’t permit it as a contingency, adds Frank Lesh, owner of Home Sweet Home Inspection Company in Indian Head Park, Ill., and executive director of the American Society of Home Inspectors (ASHI), a national organization based in Des Plaines, Ill.

Your job is to guide buyers through this rough terrain. The first thing to do with a remodel is to look at the public record and see when the property your buyers are interested in last changed hands. If it’s less than a year ago, the property may require a more thorough examination. While not every flip represents a potential landmine, you can help clients by asking for information about who completed the work, says broker Mark Ferguson with Pro Realty Inc. in North Greeley, Colo. Ferguson, also a real estate investor and blogger at InvestFourMore, says most problems arise with work done by DIY owner-flippers, who lack the skills of licensed contractors.

Here are more ways you can be an advocate for buyers who plan to purchase a house that’s being flipped. Many of the caveats reflect the same type of thoroughness that should be undertaken with any sale.

1. See it yourself

Don’t buy at auction or without seeing a house in person, says Eric Workman, senior vice president of marketing at Chicago-based Renovo Financial, a private lender. Buyers should inspect the structure so they see firsthand if visible problems exist that may be red flags for deeper trouble. This is the first step before they call in experts.

2. Learn the history of a home

Workman suggests asking officials in your community and real estate salespeople if they know how long a home may have been vacant. The number of seasons a property goes through while being empty of occupants can help predict whether its plumbing and other mechanical systems may have been neglected or damaged.

One of the most important reasons to trace a home’s lineage is that if no one has lived in the remodeled house yet, it’s hard to know how well the systems work, Captain says. “There may never have been a heavy rain to know if the home’s drainage system will stand up, or if termites are chewing away at support joists and not visible,” he says. He suggests buyers ask for names of others who’ve bought from the same flipper to learn how well their houses have fared over time.

A buyer can also request to see the permits that the flipper pulled to perform work, especially important in cases where the floor plan was changed or a load-bearing wall was removed, Ferguson says. Or, if mold was a problem, a buyer can ask if the work was done by someone licensed to handle mold remediation, he says. They can also check the area’s Better Business Bureau to see if complaints or lawsuits have been brought against the seller by a prior buyer or real estate commission.

3. Understand the flipping process

Is Your Buyer a Flipper?

Mark Ferguson, a real estate broker at Pro Realty Inc. in Greeley, Colo., cautions wannabe flippers about the difficulty of making a sizable profit. “You may see flippers on TV shows appear to make a lot of money, but it is extremely rare to make $100,000 or even $50,000 unless you are dealing in high-value, high-risk properties.” Most shows leave out the costs associated with a flip such as financing, real estate sales commissions, closing costs, homeowners’ insurance, property maintenance, taxes, and possibly homeowners’ association dues. These additional costs can be 15 to 20 percent of the sales price. “A $100,000 profit on TV may only be a $50,000 profit in real life,” he says. Ferguson, an experienced flipper, has found his average profit ranges between $20,000 and $40,000 on a purchase that cost him between $75,000 and $150,000. In addition, many buyers don’t understand the time frame, he says. “It can often take me six months or more to sell a flip once I buy it,” he says. But it may be worth it if you’re motivated by more than money, he adds: “It can be fun, done on a part-time basis if you do the repairs yourself, and you can make money with realistic ideas of costs and profit margins.”

Because a flipper’s goal is to make a profit in a relatively short period, many changes are cosmetic, such as refinishing hardwood floors and painting kitchen cabinets. Captain notes flippers often replace countertops, appliances, and fixtures in what tend to be buyers’ favorite rooms: the kitchen and bathrooms. They may forgo fixing the more expensive, time-consuming, and less visible problems. For example, a rotted subfloor may be deemed not worth fixing if it’s underneath gleaming boards, and dated plumbing may be left as long as faucets work and water pressure seems okay, Captain says: “They don’t want to kill the deal, but won’t go above and beyond. They also know that most buyers reach a point where they want to be done looking and are happy to focus just on what’s new and pretty.”

4. Hire a certified home inspector

Even if the flipper says the home was preinspected, advise buyers to bring in their own expert to avoid surprises later. But even home inspectors can miss signs of problems beyond the surface, Lesh says. “Perhaps water wasn’t run long enough during the inspection to find out that pipes hidden behind newly tiled walls are corroded,” he says. A good inspector will follow up on possible trouble spots — say, a wall that sounds hollow and may be lacking solid backer board and studs — with requests for more information. “We might ask, ‘What’s going on here?’ We won’t rip off the wall, but will request receipts to show work was done properly.”

Inspection fees typically vary by a home’s price, size, and age. Lesh charges between $650 and $700 for a 15-year-old $500,000 house. Cultivate a list of inspectors you trust, and give it to buyers so they can choose the one they want to work with.

5. Bring in additional specialists

Certain systems warrant calling in a skilled expert. Glen Gallas, vice president of operations for the Mr. Rooter franchise based in Waco, Tex., advises having a plumbing inspection even if all seems perfect. “With today’s technology, a licensed plumber can do a video camera inspection of the main sewer line to see if there are mechanical defects in the pipe, which most home inspectors don’t see,” he says. “There might be a small leak in the line from roots growing, but it could take several seasons for them to be large enough to cause problems, and that could be long after the purchase. By then, [repairs would] also be more expensive,” he says. An average plumbing inspection ranges from $150 to $400.

In the case of electrical work, a new junction box may suggest all’s well, but that doesn’t mean wiring was brought up to code, says Keith Pinkerton, owner of a Mr. Electric franchise in Huntsville, Ala. “Houses built in the late 1960s and early ’70s often were wired with aluminum, which was outlawed, and copper was required. But some might not know because they’re behind walls. We pull off the panel cover and look,” he says.

Some buyers may be content waiting to hire an expert only if the general home inspector picks up on problems such as foundation cracks that could reflect structural defects. At that point, a structural engineer can determine the seriousness of the problem. And many home owners find that it helps to bring in a structural engineer in cases where a house is very old since more problems may lurk beneath floors, below floors, between walls, and above ceilings.

6. Avoid legal glitches

Before buyers sign on the dotted line, be sure a lawyer has checked that there are no legal problems with the transfer of ownership, advises Alan Doran, executive vice president and general counsel with OneTitle National Guaranty in New York. All kinds of issues may arise when buying a property that has been flipped, he warns: “For example, if sellers acquired a property through a short sale, they need to obtain detailed information on the short sale to ensure that both transactions comply with state regulations and the original lender’s short-sale requirements,” Doran says. There may also be a requirement that the flipper owned the property for a minimum amount of time before selling, and proofs of payment of liens must be verified, he says.

With all this information in hand, your buyers can decide whether a flip is still worth buying, particularly if the seller won’t deduct estimated repair costs or fix problems. But, as Captain notes, if a flip passes muster, it may be just as desirable as any other purchase: “What difference does it make if a flipper made money in a short time if the buyer finds a wonderful home?”

AUGUST 2016 | BY BARBARA BALLINGER

7 Household Expenses You’re Probably Wasting Your Money On

There are better ways to spend.

The washer/dryer combo was perfect! Such a delightful way to brighten laundry day — with a cheerfully colored front-loader set. They could actually make laundry fun!

“They were this gorgeous, greenish-teal, and they looked great in my laundry room,” says Eliesa Prettelt, avid DIYer and author of “A Pinterest Addict” blog.

But after barreling through three sets in four years, she knew she’d made a mistake. “They looked so pretty, but I had nothing but problems with them,” she says.

She eventually gave up and got nondescript, white, commercial-grade top-loaders she scored for less than half the cost of her original machines. They may be plain, she says, but “I’ve had no problems since.”

Lesson learned. The hard way. Now for learning the easy way. Here are seven common money mistakes homeowners make — and now you won’t.

1. Contractor House Calls

Think you need a pro to fix that leaky toilet? You’d be surprised how easy it can be to fix it yourself — and save the typical $45 to $150 per hour plumbers can charge (and don’t forget the boost in your can-do attitude!). You can often find home remedies for small jobs like a leaky faucet or broken garbage disposal on YouTube. Just be sure it’s a reputable source. And check out several videos on the same repair. That’ll help make sure no crucial step is missed.

“We save a couple hundred dollars per year by doing small home repairs ourselves,” says Lauren Greutman, frugal living expert and author of “The Recovering Spender: How to Live a Happy, Fulfilled, Debt-Free Life.”

For those who prefer an expert, Greutman suggests smaller, local retail appliance stores. “It’s a little-known secret that they usually have repair men that are very inexpensive,” she says.

Related: Are You Paying Too Much for Common Household Repairs?

2. Extended Warranties

It’s tempting to insure your new, big purchase, but according to Consumer Reports, you’re probably already as covered as you need to be.

How’s that? Most major appliances come with at least a 90-day manufacturer’s warranty. Buy with a major credit card (Visa, Mastercard, Discover, or American Express) and it will likely double that standard warranty.

Combine that with the fact that “Consumer Reports” found most products won’t break during the standard two- or three-year service contract period. When they do, the repair cost is usually just a few dollars more than the cost of the warranty.

Instead of paying for an extended warranty, stash the cash in a savings account earmarked for home repairs. When you need it, it’ll be there.

3. Flashy Feature Appliances

The newest appliances come with super fun features. Who wouldn’t want an oven that talks, remote access to your A/C, or bottle jets in the dishwasher (paging new parents!)? Still, it may not be financially wise to replace a fully functioning older model just to gain modern perks. So says Arthur Teel, owner and operator of The Handyman Plan in Asheville, N.C.

Circuit boards break, and energy efficiency numbers don’t always add up,” he says.

Yup. That’s even true for some energy-efficient appliances that boast cost savings. “Spend $1,000 on a new, energy-efficient stove and it could take 10 years of energy savings to offset the cost of the new stove,” he says. “Unless you have a really old appliance, it’s probably efficient enough for your needs. Also, putting the appliance into the landfill isn’t exactly great for the environment.”

4. Budget Bulbs

Incandescents may be easy on your everyday household budget, but they’re tough on your energy bill. Start replacing them now with LEDs. To help swallow the initial costs, just replace them as they die out. A typical LED bulb can recuperate its cost in a little over a year (at least according to manufacturers, so in reality it’s probably a bit longer, but not enough to quibble about). Even better, since LEDs can last a decade or more, you won’t have to buy bulbs as often, and your energy costs will be lower!

5. Commercial Cleaning Supplies

Even if you’re buying off-brand products to save costs, you’re still wasting money. You don’t have to spend anywhere near the cost of commercial products.

“Vinegar will clean a lot of things, and it’s a heck of a lot cheaper than buying pricey cleaning supplies,” says Prettelt. She also likes baking soda and hydrogen peroxide, each of which can be found for just a fraction of the cost of their popular store-bought equivalents.

“You can use these natural products in your dishwasher, in your garbage disposal, in your wash,” Prettelt adds. Easy peasy. And it’s super cheap.

That’s right. You can make dishwasher soap from a cup each of borax and washing soda, a half-cup kosher salt, and five packets unsweetened lemonade mix. Or whip up your own window cleaner with these simple ingredients:

  • half-cup white vinegar
  • rubbing alcohol
  • two cups of water
  • two tablespoons of cornstarch

All those ingredients cost pennies. And to think you were paying $2-$4 for the commercial kind.

6. A Storage Unit

If it doesn’t fit in your home, is it really worth keeping? Ditch nostalgia and think with your bank account: At a cost of between $50 and $300 per month, it may be time to purge the junk.

If you can’t bear to part with something you don’t use regularly — say, great-grandma’s heirloom china — rethink your home’s organizational storage. Clean out the closet, craft shelves beneath the stairs, or build window seats with drawer storage. You’ll be investing in your home instead of giving money to a storage vendor.

7. Private Mortgage Insurance (PMI)

Bought your house with less than 20% down? You’re probably paying for PMI (a type of insurance that guarantees your mortgage lender will be covered if you default). It costs between $600 and $1,200 per year for a typical home. But once your loan-to-value ratio drops to 80%, you’re not required to pay it. But the lender isn’t required to drop it until it reaches 78%.

That 2% difference could cost you hundreds, even thousands of dollars, depending on your home’s mortgage balance. So, keep an eye on your statement and whip out that calculator when you’re getting close. Then, if you’re feeling really savvy, keep paying that amount every month — but apply it to your mortgage principal instead. Do that, and you could recoup your PMI fees. Because as you pay down your principal, you’ll pay less in interest, potentially saving thousands. Now how savvy is that?