Money Down the Drain

Private mortgage insurance is necessary for buyers who don’t have or choose not to put 20% or more down payment when they purchase a home.  It is required for high loan-to-value mortgages and it provides an opportunity for many people to get into a home who otherwise would not be able.

The problem is that it is expensive and a homeowner’s goal should be to eliminate it as soon as possible to lower their monthly payment and avoid putting good money down the drain.

FHA loans made after 6/1/13 that have 90% or higher loan-to-value at time of purchase have mortgage insurance premium for the life of the loan.   FHA loans made prior to 6/1/13, can have the MIP removed after five years and if the unpaid balance is 78% or less than the original loan-to-value.

VA loans do not require mortgage insurance.

Conventional loans, in most cases, with higher than 80% loan-to-value require mortgage insurance.  The cost of that insurance varies but with a $250,000 mortgage, it could easily be between $100 and $200 a month.

Your monthly mortgage statement should itemize what your monthly fee is for the mortgage insurance.   Unlike interest that is deductible, most homeowners are not able to deduct mortgage insurance premiums.

If you plan to remain in the home or to stay there for a considerable number of years, the solution may be to refinance the home.   If the home has increased since it was purchased, the loan-to-value at its new appraised value may not require PMI.  You might even be fortunate enough to obtain a lower rate than you currently have.

3852 Charlotte - Kansas City, MO - Hyde Park Beauty - $315,000

The area of Hyde Park is a great historic neighborhood in Kansas City.  If you have not been down to this area I would highly suggest you take time for a visit to see the great architecture and restored homes in this area.  If you are up for an Open House - I will be down at 3852 Charlotte from 1-4 pm on Sunday 9/7/2014 and would love to have you take a look at 3852 Charlotte.


 If you do not see posting above - go to:
 http://postlets.com/s/3852-charlotte-st-kansas-city-mo-64109/12208634!

Hyde Park Beauty on wonderful private street. This wonderful 3Sty home has a 2 car garage, Formal living, Formal dining room, 1/2 bath on main, Large kitchen with center island. 2nd floor homes, 3 bedrooms, a full bathroom, family room, sun room and laundry room. 3rd floor has 2 bedrooms (one they use as an office) Master bath and walk-in closet. Basement walks up to backyard. This home has it all. Do not miss it!!!106 yr old brick siding "Shirtwaist" home in historic Hyde Park.

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpyThe American Royal, a cause very near and dear to The Bubb Cribb Team is an every-autumn-since-1899 horse and livestock show, it was originally first known as the National Hereford Show. It picked up a new name, the story goes, after an Iowa State ag school dean returned from the British Royal Agricultural Fair and declared that the KC show compared favorably with the Brits’. The American Royal, meanwhile, is also at least part of the reason our major league baseball team is known as the Kansas City Royals.  The American Royal also holds the world's largest BBQ, theAmerican Royal World Series of Barbequeevery year in October, a great time and place to bring people from out of town to experience Kansas City at a great time of year and focus on our BBQ culinary expertise.  The economic impact of this great Fall event in Kansas City at last estimate was around $70 Million Dollars per year!

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

If you are looking to sell and list your home or to put an offer in on a new home, now is the time and the Bubb Cribb Team would love to help you!

The Bubb Cribb Team at ReeceNichols would love to be your neighborhood experts in buying or selling your home in any part of Kansas City.  We have great area specialists in Union Hill, Hyde Park, Brookside, Sunset Hills, Waldo, Mission Hills, Prairie Village, Overland Park, Fairway, Leawood, Kansas City North, Lees' Summit and more; please contact Christopher Cribb, Megan Bubb Cribb or Eric Bubb for assistance!

Christopher Cribb - The Bubb Cribb Team 
ReeceNichols - StateLine / Southgate - Direct Line 913.239.2023

Cash Flow and Equity Build-up

Many years ago, Las Vegas hotels would entice customers with inexpensive rooms, meals and entertainment so they would gamble.  It may have worked initially but if you’ve been to Las Vegas recently, the bargains are gone.  Hotels expect each division to be a profit center on its own.  As a consumer, I might not like the changes but as an investor, I’d have to be pleased with increased profitability.

Years ago, real estate investors used to accept negative cash flow buoyed by tax incentives in hopes of making a big payday due to appreciation when they sold it.   Today’s investors are focusing on tangible, current results like cash flow and equity build-up.

Cash flow is the amount of money you have left over after collecting the rent and paying the expenses.  Since rents have gone up considerably due to supply and demand in the last few years and mortgage rates are at near record lows, income is up and expenses are down, making the cash flows attractive.

If the cash flow is sufficient, you could have a good investment even if the value of the property never increased.  Cash on Cash doesn’t consider appreciation and measures the cash flow before tax advantages by the initial investment.  A rental with $3,170 CFBT divided by an initial investment of $29,000 would generate a 10.93% Cash on Cash rate of return.

Low down payments on investor properties are also a thing of the past.  Non-owner occupied mortgage money is available but the investor should expect to put down 25-30%. An advantage of having a smaller mortgage is a lower payment.

Most mortgages are amortized loans with both principal and interest due with each payment.  The forced savings of the principal contribution builds equity in the property and can be considered a part of the rate of return.

A $100,000 mortgage at 4.5% for 30 years would have $1,613.29 applied to principal in the first year.  Divide that by the same $29,000 initial investment and the amortization would generate another 6%.

Without factoring in appreciation or tax advantages, this rental example generates much more than most alternative investments.  There certainly are many different aspects that affect the risk and return on rental investments.  If you haven’t scrutinized single-family rental opportunities in a while, you should look again.

How Was It Measured?

In an attempt to compare homes, one of the common denominators has been price per square foot.  It seems like a fairly, straight forward method but there are differences in the way homes are measured.

The first assumption that has to be made is that the comparable homes are similar in size, location, condition and amenities.  Obviously, a variance in any of these things affects the price per square foot which will not give you a fair comparison.

The second critical area is that the square footage is correct.  The three most common sources for the square footage are from the builder or original plans, an appraisal or the tax assessor.  The problem is that none of sources are infallible and errors can always be made.

Still another issue that causes confusion is what is included in measuring square footage.  It is commonly accepted to measure the outside of the dwelling but then, do you include porches and patios?  Do you give any value for the garage, storage or other areas that are not covered by air-conditioning?

Then, there’s the subject of basements.  Many local areas don’t include anything below the grade in the square footage calculation but almost everyone agrees that the finish of the basement area could add significant value to the property.

Accurate square footage matters because it is used to value homes that both buyers and sellers base their decisions upon.

Let’s say that an appraiser measures a home with 2,800 square feet and values it at $275,000 making the price per square foot to be $98.21.  If the assessor reports there are 2,650 square feet in the dwelling and the owner believes based on the builder, there is 2,975 square feet, you can see the challenge.

If the property sold for the $275,000, based on the assessor’s measurements, it sold for $103.77 per square foot and by the owner’s measurements, it sold for $92.44 per square foot. Depending on which price per square foot was used for a comparable, valuing another property with similar square footage could have a $30,000 difference.

The solution to the dilemma is to dig a little deeper into where the numbers come from and not to take the square footage at “face value”.  It is important to recognize that there are differences in the way square footage is handled.

Which Filter to Use?

A dirty air filter decreases the effectiveness of your HVAC system because it inhibits airflow and allows dirt, dust, pollen and other materials to blow through the system.

The challenge is how often it should be changed to keep the system working efficiently and extend the equipment life. Too often and you’re wasting money and not often enough and your increasing the operating and maintenance costs.

Fiberglass panel filters are inexpensive and easy to find but they’re not very efficient and they allow most dust to pass through. They were popular years ago but there are much better products available currently.

Pleated air filters are available in MERV ratings from 5 to 12. As these filters collect dirt and other particles, they become less efficient to the point of impacting air flow. Allergy sufferers can benefit from this type of filter. These should be changed every two to three months based on local conditions.

HEPA filters stand for High Efficiency Particulate Arrestance. They are very efficient and more expensive than previously described filters. Since they are very efficient, they require changing more frequently; possibly, every month.

Electrostatic air filters are permanent and washable. They generally cost more initially but the savings will be based on how long they last. This type does not add to landfill issues or produce ozone.

Improperly maintained filters will lower the quality of the air in the home, have a negative impact on air flow, cause it to use more electricity and eventually require maintenance to the systems.

In an attempt to easily comparing filters, a rating system was created called MERV, an acronym for Minimum Efficiency Reporting Value. The rating from 1 to 16 indicates the efficiency of a filter based on standards set by ASHRAE. Higher ratings indicate a greater percentage of particles are being captured in the filter.

To create a system to remind you when to change your filters, set a reminder on your electronic calendar to recur for whatever frequency you determine is best for you. Be sure to keep a supply of filters on hand to be ready to change them out when the time comes.

Ten things everyone should know about #KansasCity - From A KC Resident

I am not a huge fan of Top 10 lists, but in no particular order check out these ten things that every person should know about "our town" Kansas City!

• “Christopher Elbow” may sound like something you’d see the doctor for, but chocolate-loving Kansas Citians know better. Elbow, a Liberty native, worked as a pastry chef for Emeril Lagasse’s Delmonico in Las Vegas and the American Restaurant. Now he’s renowned for artistic, pricey “artisan chocolates.” (He has a shop in San Francisco, too.) His chocolate is art... and don’t forget Elbow’s collaboration with Boulevard Brewing — Chocolate Ale, which comes out once a year and can be hard to get — and his unique and decadent Glacé Artisan Ice Cream (get it at the shops south of the Country Club Plaza and in Leawood).

• The Kansas City Royals won their only World Series on Oct. 27, 1985, beating the St. Louis Cardinals four games to three in what was known as the “I-70 Series.” Pitcher Bret Saberhagen was named series MVP. Twenty-seven years later, fans are still hoping this will be the Royals’ year.  The 2014 year with the Kansas City Royals in First Place in their division after August 15th is really the first time this has happened in a VERY LONG TIME!

• Short on gas and near the state line? Head for Missouri. Due to a difference in the state gas tax, you can often find gas 10 cents cheaper per gallon.  Just one of the reasons there are convenience stores and gas stations all along State Line Road.

• Kansas City is the barbecue capital of the world. Just ask any Kansas Citian. Back in the day, the stockyards provided cheap meat that was slowwwwww-cooked over native hardwoods like hickory and fruit trees. As for KC-style sauce, it’s typically tomato- and molasses-based.  The American Royal, a great Kansas City institution very near and dear to The Bubb Cribb Team is an every-autumn-since-1899 horse and livestock show, was first known as the National Hereford Show. It picked up a new name, the story goes, after an Iowa State ag school dean returned from the British Royal Agricultural Fair and declared that the KC show compared favorably with the Brits’. The American Royal, meanwhile, is also at least part of the reason our major league baseball team is known as the Kansas City Royals.  BBQ and Kansas City go hand in hand and the American Royal World Series of BBQ is the world's largest BBQ event, this is a Fall event for Kansas City that needs to be on your calendar and brings an estimated $70 Million dollars in annual revenue to Kansas City.

• Hyatt Regency Collapse - One dark day: On July 17, 1981, during a tea dance, two skywalks collapsed in the Hyatt Regency hotel’s lobby atrium. The death toll would be 114 souls, with more than 200 people injured. (Just last year the hotel became known as Sheraton Kansas City Hotel at Crown Center.)  A memorial is planned for Hospital Hill Park across the street.

• Shawnee Mission is a school district and a postal district, but not a city (though Shawnee and Mission both are). Confused yet? It’s named for the old Shawnee Indian Mission in what is now Fairway.

• Kansas City is not one of the 10 largest metropolitan areas in the country (not even close — 27th), but it does boast one of the nation’s largest urban parks. That’d be Swope Park, which at 1,805 acres is more than twice the size of New York City’s 843-acre Central Park. 

• It doesn’t really matter whether you say “Plaaaza” or “Plahza.” What matters is knowing that the elegant shopping district, the brainchild of developer J.C. Nichols, is a Kansas City original (though it’s modeled after Seville, Spain), considered the first suburban shopping center, The Country Club Plaza.  When it opened in 1922, the area around Brush Creek was considered, as we say these days, “out south.” We now know the 15-block Plaza as a mix of stores, restaurants and apartments. Plus lovely courtyards, fountains and other public art such as a sculpture of Mr. and Mrs. Winston Churchill.  By the way, you can hardly call yourself a Kansas Citian if you don’t know what happens every Thanksgiving evening on the Plaza. That’s when the switch is flipped on the Plaza Lights, one of the city’s most enduring holiday traditions. Throw in some softly falling snow and you’ll feel like you’re in a dream.

• The famous song “Kansas City” promises some women, some wine and definitely a good time at the corner of 12th Street and Vine. But don’t take it too literally; there is no such place. Not anymore. But do pose for photos under the commemorative sign that marks the historic intersection at the renovated park that has been there since 2005. The crazy little women? Good luck! (You can, however, find a jazz museum, the Negro Leagues Baseball Museum and more at 18th and Vine.)

• What’s in a name? Plenty. Lore has it that “Possum Trot” and “Rabbitville” were in the running before “Town of Kansas” was agreed upon, which then became “City of Kansas” as it grew, and ultimately, Kansas City. Such a great name, there are two.  Thank goodness we are not Rabbitville, people already think Kansas City is where Toto is from and the true "midwestern hick" motif would be stronger than ever, PS - who would want to write Rabbitville on their post cards - and by the way, where are all these rabbits now?

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpyThe American Royal, a cause very near and dear to The Bubb Cribb Team is an every-autumn-since-1899 horse and livestock show, it was originally first known as the National Hereford Show. It picked up a new name, the story goes, after an Iowa State ag school dean returned from the British Royal Agricultural Fair and declared that the KC show compared favorably with the Brits’. The American Royal, meanwhile, is also at least part of the reason our major league baseball team is known as the Kansas City Royals.  The American Royal also holds the world's largest BBQ, the American Royal World Series of Barbeque every year in October, a great time and place to bring people from out of town to experience Kansas City at a great time of year and focus on our BBQ culinary expertise.  The economic impact of this great Fall event in Kansas City at last estimate was around $70 Million Dollars per year!

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

If you are looking to sell and list your home or to put an offer in on a new home, now is the time and the Bubb Cribb Team would love to help you!

The Bubb Cribb Team at ReeceNichols would love to be your neighborhood experts in buying or selling your home in any part of Kansas City.  We have great area specialists in Union Hill, Hyde Park, Brookside, Sunset Hills, Waldo, Mission Hills, Prairie Village, Overland Park, Fairway, Leawood, Kansas City North, Lees' Summit and more; please contact Christopher Cribb, Megan Bubb Cribb or Eric Bubb for assistance!

Christopher Cribb - The Bubb Cribb Team 
ReeceNichols - StateLine / Southgate - Direct Line 913.239.2023

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

Read more here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpyre here: http://www.kansascity.com/living/star-magazine/article302401/Fifty-things-every-Kansas-Citian-should-know.html#storylink=cpy

Branding 101 - Get Back To the Basics & A Great Brookside Home - 6732 Rockhill Road

This week the Reece & Nichols corporate office told all of their partners and team members what they have been working on for the last few months in the executive boardroom;  a brand / marketing relaunch to change & update the image of our strong organization in the Kansas City market.  Ok, that sounds like it could be good, but what did it really mean, where is the focus of these initiatives, what are you going to change... are we talking about a mountain or a molehill?  It had been quite a long time since the J.D. Reece company combined forces with JC Nichols to form Reece & Nichols, but more recently that entire company had become a Berkshire Hathaway/ Home Services of America Affiliate, what direction would this brand / mission follow? (see below)



I won't bore you with the nuances and subtleties, we have the number one brand for real estate in Kansas City and I for one am happy to see us not abandon who we are in an effort to conform with the national BHHS companies.  Real estate is and always will be a "home town" game and I believe the new branding changes give a true nod to ReeceNichols as the premier real estate brand in the greater KC / Midwest region.  Blacktop Creative, the advertising firm that assisted ReeceNichols with this change, did an outstanding job in changing The Kansas City Wizards to Sporting KC a few years back, kudos on this great accomplishment! I further am confident that this focus on the customer, our service levels, our core mission and ongoing efforts to improve will be shown to each one of our clients daily.  Now if we could only have the cool apparel that Sporting KC has we will be set! :)



One image stuck out in my head from this branding change, the evolution of the Starbucks company and brand; over the years Starbucks has kept a laser focus on this part of their strategy and it shows.  Take a look for yourself at this brand / style and especially as a visual person, it gives you an "ah-ha" moment.  It makes sense where ReeceNichols is moving, it makes sense how I might need to take a look at my own brand / company brand and say, what are we doing to keep this a fresh and changing embodiment of our own ideals and success?


OK - enough about branding for today, if you haven't looked at your own brand do it, it is worth it. Sometimes you need to make sure you are working "on the business" and not always "in the business".

For all of my Brookside (or want to be in Brookside) buyers out there, check out this great new listing we have at 6732 Rockhill Road, Kansas City, MO 64131.  A charming place, with great curb appeal, attention to detail in the architecture, & lovely space to entertain both inside and out.

For some reason some browsers have been having trouble with this embedded widget, if so you can see all the details on this home here as well - 6732 Rockhill Road - Kansas City, MO $174,900 - Brookside


Don't miss this Brookside gem on a great street minutes from everything! Charming with curb appeal, this cottage style home has an open ranch floor plan with large Family Room in basement. First Floor opens from Formal Living Room with fireplace into atrium space that could be 2nd family room or office. Hardwood floors throughout the home are in good shape & colors have a fresh Pottery Barn appeal. Backyard with screened-in porch, newly stained deck & patio are great for entertaining.  Close access to University Academy, Academy Lafayette and Research Medical are a bonus.

If you are looking to sell and list your home or to put an offer in on a new home, now is the time and the Bubb Cribb Team would love to help you!

The Bubb Cribb Team at ReeceNichols would love to be your neighborhood experts in buying or selling your home in any part of Kansas City.  We have great area specialists in Union Hill, Hyde Park, Brookside, Sunset Hills, Waldo, Mission Hills, Prairie Village, Overland Park, Fairway, Leawood, Kansas City North, Lees' Summit and more; please contact Christopher Cribb, Megan Bubb Cribb or Eric Bubb for assistance!

Christopher Cribb - The Bubb Cribb Team 
ReeceNichols - StateLine / Southgate - Direct Line 913.239.2023