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Home » Business And Finance Articles » Selling Your House Simple Gardening Tasks Can Help

Selling Your House? Simple Gardening Tasks Can Help

When we think about getting a house ready to sell, we often focus on the structure itself. We ask ourselves if the walls need painting, should the carpets be cleaned or replaced, do any of the plumbing fixtures need to be repaired, etc. However, the item that is seen first, by every potential buyer that drives by your house, is your front lawn and garden. Spending some extra time on your landscaping before you list your house with a real estate agent can make a big difference in how long it takes a house to sell.

Think of it this way - would you feel comfortable with the idea of seeing a doctor if all the plants in his waiting room were dead? It sets up some negative emotions, doesn't it? The same thing happens when people drive by a house that is surrounded by dying, weedy grass, overgrown bushes, and cracked sidewalks. Since the impression is on a purely emotional level, it may be difficult for your buyers to overcome.

There's a good example of this problem right now, in my neighborhood. Although houses in my city are selling ast this summer, and they don't stay on the multiple listing service for very long, a 'For Sale by Owner' sign has been in the window of a house down the street for months. The owner lives out of town, and probably purchased the house as a rental. Now that home prices are higher, he's ready to sell, but he can't take care of the yard himself because he lives too far away. He did recently hire someone to cut down the overgrown grass, but I suspect he did so only in response to a complaint from the city authorities.

This attitude on the part of the seller reminds me of that ancient saying "penny-wise, pound foolish".

Fortunately, it doesn't take a whole lot of money to get most yards looking good, and it can make a huge difference in the curb appeal of your house. It does, however, take time - especially if the grass has been neglected for too long. Some regular watering might revive it, but if things have gone too far, you may need to reseed the grass and start over. This might also be true in the back yard, if a large puppy or a team of budding football stars has worn ruts in the grass. The most important thing for the grass is to get it green again, and keep it mowed. If dandelions have taken over, a neighborhood kid might be willing to pull them out, if the price is right.

If bushes along your fence are badly overgrown, they may need a hard pruning. Some ornamental shrubs and small trees can be pruned at almost any time, but others must be approached with more caution. To see exactly how and when your shrubbery can be pruned, do a Google search for the particular type of plant, or find a good book on pruning at your local library. Overgrown Arborvitae growing near the house may need to be removed, as would any other fast-growing shrub that refuses to stay within its allotted space, and which would be nothing but bare sticks if it you cut it back.

If you do need to remove overgrown or dying foundation plantings, they can be replaced with fast-growing annuals or perennials. First dig the soil as deep as you can and add compost and plant food to improve the soil's fertility. Then ask your local nursery for suggestions - they'll be able to show you which plants will grow the fastest and fill in the empty space. If you put out a drip hose and attach a timer, you won't need to do much more than pull an occasional weed to keep it looking nice.

A friend of mine recently sold her house, which was surrounded by a beautiful cottage garden that took her years to build. She knew that most people don't have time to care for so many different plants, and would prefer to simply water and mow the grass - so she made sure to list her house when her garden was at its peak. Even if her buyer has to remove all those flowers because he can't take proper care of them, they still helped to create a positive impression with all that color. Her home, surrounded by masses of color, was on the market for only a few weeks.

You can easily add a few spots of color to your yard without planting a perennial border of creating a cottage garden. One exceptionally easy trick is to buy a large planter that matches the color of your house, fill it with one small shrub from the nursery surrounded by fast-growing annuals, and place it just beside your front door. It doesn't take much time, but it can add that little touch of life that makes your house feel more like "home" to your potential buyers.

And here is another random article you might be interested in...

How To Dissect Mutual Fund Returns

While total and compound annual returns are useful, savvy investors will look deeper, using a variety of metrics, to get a more complete picture on mutual fund performance.

On January 1, 2006, a leading financial daily reported the trailing 1-year and 5-year returns of Fidelity Contrafund (Nasdaq: FCNTX), a no-load mutual fund, as 16.23% and 6.21% respectively. While the financial daily's return information is useful, there is more to mutual fund returns.

Is the performance of the fund superior or inferior?

How tax-efficient is the fund in delivering these returns?

Are the returns of the fund commensurate with the risk the fund manager has taken to achieve them?

Savvy investors will seek answers to such questions when evaluating mutual fund returns. Before getting into the nitty-gritty of mutual fund returns, it is good to understand what the data reported in the financial daily really mean.

Total Return

Fidelity Contra's reported 16.23% 1-year return is the fund's total return for the December 31, 2004 to December 31, 2005 period. In practical terms, $10,000 invested in the fund on December 31, 2004 is worth $11,623 on December 31, 2005. The total return includes more than the increase (or decrease) in the fund's share price. It also assumes reinvestment of all dividends as well as short- and long-term capital gain distributions into the fund at the price at which each distribution is made.

Compound Annual Return

The reported 6.21% 5-year return is the fund's compound annual return (also called the average annual return). The compound annual return is a calculated number that describes the rate at which the investment has grown assuming uniform year-over-year growth during the 5-year period.

A $10,000 investment in the Contrafund on December 31, 2000 has grown to $13,515.34 on December 31, 2005. The ending value of $13,515.34 = $10,000[(1 + 0.0621)^5] where 6.21% is the compound annual return. The investment in the fund grew at an implied annual growth rate of 6.21% over the 5-year period.

While total return and compound annual return are useful, they do not tell how a particular mutual fund has performed compared to its peers. They also do not provide information on the return actually earned by investors after accounting for taxes. Finally, they do not offer insight on how well the fund manager has managed risk while achieving the returns.

Relative Return

Relative return compares the performance of a mutual fund against its peers. It is the difference between the total return of the fund and the total return of an appropriate benchmark over the same period.

Fidelity Contra is a large-cap growth fund that primarily invests in U.S.-based companies. It is therefore appropriate to compare its performance with that of an average large-cap growth fund. It is also relevant to benchmark the fund against the Standard & Poor's (S&P) 500 index, comprising of large U.S.-based companies.

While Fidelity Contra has a compound annual return of 6.21% for the 5-year period ending December 31, 2005, Morningstar reports the average large-cap growth fund has an average annual loss of 8.48% over the same period. The S&P 500 index has an average annual return of 0.54% over the same period. Fidelity Contra has outperformed with a relative return of 14.69% over the average large-cap growth fund and with a relative return of 5.67% over the S&P 500 index.

After-Tax Return

Unlike assets held in qualified accounts such as 401k plans or individual retirement accounts (IRA), assets held in regular individual or joint accounts are not tax-deferred. For such non-qualified accounts, after-tax return is the return realized after accounting for taxes.

Short-term capital gains and short-term capital gain distributions from a mutual fund are currently taxed at the same rate as earned income. Dividends, long-term capital gain distributions, and long-term capital gains realized from the sale of fund shares are currently taxed at a lower rate.

Fidelity states the compound annual return for Fidelity Contra before taxes is 6.21% for the 5-year period ending on December 31, 2005. When all distributions are taxed at the respective maximum possible federal income-tax rate, the after-tax return dips to 6.10%. The after-tax return drops further to 5.33% after accounting for the long-term capital gain tax due on sale of the fund shares.

Risk-Adjusted Return

Some fund managers take more risk than others. It is important to assess a fund's return in light of the amount of risk the fund manager takes to deliver that return.

Risk-Adjusted Return is commonly measured using the Sharpe Ratio. The ratio is calculated using the formula (mutual fund return - risk free return)/standard deviation of mutual fund return. The higher the Sharpe ratio, the better is the fund's return per unit risk.

Based on returns for the 3-year period ending on November 30, 2005, Morningstar reports Fidelity Contra's Sharpe ratio as 1.74. The fund's Sharpe Ratio may be compared with those of similar funds to determine how the fund's risk-adjusted return compares with those of its peers.

Beyond Mutual Funds

Return concepts such as relative return, after-tax return, and risk-adjusted return may also be used for evaluating separately-managed accounts, hedge funds, and investment newsletter model portfolios.

The AlphaProfit Sector Investors' Newsletter, for example, tracks the total return and compounded annual return of its Core and Focus model portfolios. To provide Subscribers with a more complete picture of model portfolio returns, this newsletter also tracks the relative and risk-adjusted returns of the model portfolios. The newsletter's model portfolios are constructed and repositioned with a view to maximizing after-tax returns.

Summary

While total return and compound annual return are useful, they do not provide a complete picture of a mutual fund's performance. Metrics such as relative return and after-tax return offer insights on the fund's relative performance and tax-efficiency. Risk-adjusted returns enable investors to assess how a fund's returns stack up when risk is factored in.

Notes: This report is for information purposes only. Nothing herein should be construed as an offer to buy or sell securities or to give individual investment advice. This report does not have regard to the specific investment objectives, financial situation, and particular needs of any specific person who may receive this report. The information contained in this report is obtained from various sources believed to be accurate and is provided without warranties of any kind. AlphaProfit Investments, LLC does not represent that this information, including any third party information, is accurate or complete and it should not be relied upon as such. AlphaProfit Investments, LLC is not responsible for any errors or omissions herein. Opinions expressed herein reflect the opinion of AlphaProfit Investments, LLC and are subject to change without notice. AlphaProfit Investments, LLC disclaims any liability for any direct or incidental loss incurred by applying any of the information in this report. The third-party trademarks or service marks appearing within this report are the property of their respective owners. All other trademarks appearing herein are the property of AlphaProfit Investments, LLC. Owners and employees of AlphaProfit Investments, LLC for their own accounts invest in the Fidelity Mutual Funds included in the AlphaProfit Core and Focus model portfolios. AlphaProfit Investments, LLC neither is associated with nor receives any compensation from Fidelity Investments or other mutual fund companies mentioned in this report. Past performance is neither an indication of nor a guarantee for future results. No part of this document may be reproduced in any manner without written permission of AlphaProfit Investments, LLC. Copyright © 2006 AlphaProfit Investments, LLC. All rights reserved.