Tips | Tricks | Information | and More!

You’ll find our blog to be a wealth of information, covering everything from local market statistics to Tips and Tricks, to Anything and Everything!!

Please reach out if you have any questions at all. We’d love to talk with you!

Nov. 9, 2018

VA vs. Conventional Loan

Our service personnel and veterans give so much to our country. While they sacrifice much, there are a few special benefits that only these service men and women can take advantage of; one of the best benefits is the VA Loan. 

The VA Loan differs from a Conventional Loan in a number of ways. While both provide great interest rates for borrowers and are both backed by US Government guarantee programs, this is where the similarities end. 

Key Differences/Advantages of the VA Loan

0% Down Options – VA Loans offer the option of a 0% down payment vs conventional loans which need 10-20% minimum down payment.

No Private Mortgage Insurance Required 

More Lenient Credit Qualifications – FICO scores are used for both conventional and VA Loans, but VA Loans consider a lower threshold for loans while still offering favorable interest rates. 

Can Be Used More Than Once – VA Loan borrowers can regain their eligibility for a VA Loan without giving up their first loan. In other words, if a service member wishes/needs to rent out their current home to move, they can regain their eligibility and use the VA Loan Programs again. 

VA Loans is a great benefit for our service men and women who give so much to their country. 

 

Nov. 7, 2018

Where are all the buyers?

Have you noticed fewer serious buyers roaming the streets? So have we, in the data.
 As you can see, the customary drop in sales we see from August-October is noticeably larger this year and the number of homes on the market is higher than it's been since 2015.
 This isn't panic time -- inventory is still low.
Call us and see how we can help you sell your house in this market!
Nov. 4, 2018

The Difference An Hour Will Make This Fall

 

Every Hour in the US Housing Market: 

  • 596 Homes Sell
  • 278 Homes Regain Positive Equity
  • Median Home Values Go Up $1.20
Oct. 30, 2018

Tips to Increase the Value of Your Rental Property

 

Looking into rental properties and seeing what all have to offer, I have noticed that now, residents are looking for more than the typical "4 walls and appliances". I am sure you are all aware.

 

However, what is considered "more"?

 

  • Landscaping. Updating your landscaping and curb appeal will attract residents to your property quicker than not doing anything at all. This is a first impression and first impressions only come along one time! 
  • Paint Your Interior. Most potential residents like to view homes, and possibly consider the units more if the paint on the interior is fresh. Fresh paint is a visual assumption that the owner of the property takes pride in his/her investment, and most residents will continue to do the same. 
  • Refresh Your Kitchen. Giving your kitchen a refresh will attract more potential residents as well. In the long run, the updated stainless steel appliances, (even matching black appliances), and sprucing up the cabinets (whether it be brand new cabinets...which can be costly....or even a good, fresh coat of paint), can make a world of a difference. Not to mention, you can install a more durable flooring such as vinyl plank flooring. This is a great option and some are even 100% waterproof! Much more efficient for those potential leaks and can help reduce water damage.
  • Including Washers and Dryers. I have always had mixed feelings about including a washer and dryer in a rental unit for a couple reasons such as the landlord is still responsible for repairs, potential misuse by the resident (even unintentional...especially if the washer and dryer is located on the 2nd floor). I can certainly understand it would be an added convince and something that the residents would not need to purchase, however, weigh out your options on this one. 
  • is Your Home a Smart Home? What the heck is a smart home? A Smart Home is a home equipped with lighting, heating, and electronic devices that can be controlled remotely by phone or computer. This new technology is what residents are looking for in a rental home. So, how can this help you as a landlord? During vacancies and with a resident in place, you can control thermostats, carbon monoxide and smoke detectors, garage door openers and door locks...and all can be a big incentive to anyone looking at your home. 

Times change, as well as potential residents are now looking for more....does your property have MORE?

Oct. 18, 2018

Is the Increase in Inventory a Bullish or Bearish Sign for Real Estate?

In a recent article, National Housing Inventory Crisis Reaches Inflection Point, realtor.com reported that:

 

  • New listings jumped 8% year-over-year nationally, the largest increase since 2013
  • Total listings in the 45 largest markets are now up 6% on average over last year

This increase in housing inventory has sparked two different reactions. Some are saying this is the first sign of a potential collapse while others are saying it is a welcomed reprieve from the lack of inventory that has stalled the market recently. As Zelman & Associates reported in a recent ‘Z Report’:

“With the rate of home price appreciation starting to decelerate alongside the uptick in inventory, we expect significant debate whether this is a bullish or bearish sign.”

 

Is this a sign the market might crash?

There are those who look at the increase in inventory as a sign that we are returning to the market we saw last decade. However, a closer look shows that we are nowhere near the levels of inventory we reached before the crash in 2008.

 

A normal market would have about 6-months inventory, but the latest Existing Home Sales Report issued by the National Association of Realtors revealed that:

“Unsold inventory is at a 4.3-month supply at the current sales pace up from 4.1 months a year ago.”

 

A decade ago, prices began to rapidly depreciate in June 2007. At that time, we had a 9.1-month supply (more than double what it is today) and inventory kept rising until it hit a peak of 11.1 months in April of 2008.

With the current levels of buyer demand, any such increase in months supply is highly unlikely. As Danielle Hale, realtor.com’s Chief Economist explains:

 

 “After years of record-breaking inventory declines, September’s almost flat inventory signals a big change in the real estate market. Would-be buyers who had been waiting for a bigger selection of homes for sale may finally see more listings materialize. But don’t expect the level to jump dramatically.

 

Plenty of buyers in the market are scooping up homes as soon as they’re listed, which will keep national increases relatively small for the time being.”

 

What will be the result of the increase in inventory?

The increase in inventory will allow many families who had been unable to find a home to finally become homeowners. Again, we quote from the ‘Z Report’:

 

“In our view, the short-term narrative will probably be confusing, but more sustainable growth and affordability will likely be the end result.”

 

Bottom Line

If you are either a first-time or second-time buyer who has given up, check with a local real estate professional to see if new listings have come to the market in your area.

Oct. 17, 2018

5 Tips for Starting Your Home Search

In today’s real estate market, with low inventory dominating the conversation in many areas of the country, it can often be frustrating to be a first-time homebuyer if you aren’t prepared.

 

In a recent realtor.com article entitled, “How to Find Your Dream Home—Without Losing Your Mind,” the author highlights some steps that first-time homebuyers can take to help carry their excitement of buying a home throughout the whole process.

 

1. Get Pre-Approved for a Mortgage Before You Start Your Search

One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search. Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing whether or not your dream home is within your reach.

This step will also help you narrow your search based on your budget and won’t leave you disappointed if the home you tour, and love, ends up being outside your budget!

 

2. Know the Difference Between Your ‘Must-Haves’ and ‘Would-Like-To-Haves’

Do you really need that farmhouse sink in the kitchen to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Could the ‘man cave’ of your dreams be a future renovation project instead of a make-or-break right now?

Before you start your search, list all the features of a home you would like and then qualify them as ‘must-haves’, ‘should-haves’, or ‘absolute-wish list’ items. This will help keep you focused on what’s most important.

 

3. Research and Choose a Neighborhood You Want to Live In

Every neighborhood has its own charm. Before you commit to a home based solely on the house itself, the article suggests test-driving the area. Make sure that the area meets your needs for “amenities, commute, school district, etc. and then spend a weekend exploring before you commit.”

 

4. Pick a House Style You Love and Stick to It

Evaluate your family’s needs and settle on a style of home that would best serve those needs. Just because you’ve narrowed your search to a zip code, doesn’t mean that you need to tour every listing in that zip code.

An example from the article says, “if you have several younger kids and don’t want your bedroom on a different level, steer clear of Cape Cod–style homes, which typically feature two or more bedrooms on the upper level and the master on the main.”

 

5. Document Your Home Visits

Once you start touring homes, the features of each individual home will start to blur together. The article suggests keeping your camera handy and documenting what you love and don’t love about each property you visit. They even go as far as to suggest snapping a photo of the ‘for sale’ sign on the way into the property to help keep the listings divided in your photo gallery.

Making notes on the listing sheet as you tour the property will also help you remember what the photos mean, or what you were feeling while touring the home.

 

Bottom Line

In a high-paced, competitive environment, any advantage you can give yourself will help you on your path to buying your dream home.

Oct. 15, 2018

Pre-Approval: Your 1st Step in Buying a Home

In many markets across the country, the number of buyers searching for their dream homes outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

 

Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing if your dream home is within your reach.

 

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you through this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

 

Freddie Mac describes the ‘4 Cs’ that help determine the amount you will be qualified to borrow:

  • Capacity: Your current and future ability to make your payments
  • Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
  • Collateral: The home, or type of home, that you would like to purchase
  • Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential homebuyers overestimate the down payment and credit scores necessary to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so.

Oct. 15, 2018

The True Cost of NOT Owning Your Home

Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for the entirety of America’s existence.

 

Realtor.com reported that:

“Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option…as people get more savings in their pockets, buying becomes the better option.”

 

What proof exists that owning is financially better than renting?

1. In a previous blog, we highlighted the top 5 financial benefits of homeownership:

 

  • Homeownership is a form of forced savings.
  • Homeownership provides tax savings.
  • Homeownership allows you to lock in your monthly housing cost.
  • Buying a home is cheaper than renting.
  • No other investment lets you live inside of it.

 

2. Studies have shown that a homeowner’s net worth is 44x greater than that of a renter.

3. Less than a month ago, we explained that a family that purchased an average-priced home at the beginning of 2018 could build more than $49,000 in family wealth over the next five years.

4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent payment – along with a profit margin!

Bottom Line

Owning your home has many social and financial benefits that cannot be achieved by renting.

Oct. 9, 2018

What's Going On With Home Prices?

According to CoreLogic’s latest Home Price Insights Report, national home prices in August were up 5.5% from August 2017. This marks the first time since June 2016 that home prices did not appreciate by at least 6.0% year-over-year.

CoreLogic’s Chief Economist Frank Nothaft gave some insight into this change,

 

“The rise in mortgage rates this summer to their highest level in seven years has made it more difficult for potential buyers to afford a home. The slackening in demand is reflected in the slowing of national appreciation, as illustrated in the CoreLogic Home Price Index.  

National appreciation in August was the slowest in nearly two years, and we expect appreciation to slow further in the coming year.”

 

One of the major factors that has driven prices to accelerate at a pace of between 6-7% over the past two years was the lack of inventory available for sale in many areas of the country. This made houses a prized commodity which forced many buyers into bidding wars and drove prices even higher.

According to the National Association of Realtors’ (NAR) latest Existing Home Sales Report, we are starting to see more inventory come to market over the last few months. This, paired with patient buyers who are willing to wait to find the right homes, is creating a natural environment for price growth to slow.

Historically, prices appreciated at a rate of 3.7% (from 1987-1999). CoreLogic predicts that prices will continue to rise over the next year at a rate of 4.7%.

 

Bottom Line

As the housing market moves closer to a ‘normal market’ with more inventory for buyers to choose from, home prices will start to appreciate at a more ‘normal’ level, and that’s ok! If you are curious about home prices in your area, talk to a local real estate professional who can show you what’s going on!

Oct. 8, 2018

2 Factors to Watch in Today's Real Estate Market Whether Buying or Selling

When it comes to buying or selling a home there are many factors you should consider. Where you want to live, why you want to buy or sell, and who will help you along your journey are just some of those factors. When it comes to today’s real estate market, though, the top two factors to consider are what’s happening with interest rates & inventory.

 

Interest Rates

Mortgage interest rates have been on the rise and are now over three-quarters of a percentage point higher than they were at the beginning of the year. According to Freddie Mac’s latest Primary Mortgage Market Survey, rates climbed to 4.72% for a 30-year fixed rate mortgage last week.

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows the impact that rising interest rates would have if you planned to purchase a $400,000 home while keeping your principal and interest payments between $2,020-$2,050 a month.

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will be over 5% by this time next year.

 

Inventory

A ‘normal’ real estate market requires there to be a 6-month supply of homes for sale in order for prices to increase only with inflation. According to the National Association of Realtors (NAR), listing inventory is currently at a 4.3-month supply (still well below the 6-months needed), which has put upward pressure on home prices. Home prices have increased year-over-year for the last 78 straight months.

The inventory of homes for sale in the real estate market had been on a steady decline and experienced year-over-year drops for 36 straight months (from July 2015 to May 2018), but we are starting to see a shift in inventory over the last three months.

The chart below shows the change in housing supply over the last 12 months compared to the previous 12 months. As you can see, in June, July, and August, inventory levels have started to increase as compared to the same time last year.

This is a trend to watch as we move further into the fall and winter months. If we continue to see an increase in homes for sale, we could start moving further away from a seller’s market and closer to a normal market.

 

Bottom Line

If you are planning to enter the housing market, either as a buyer or a seller, make sure that you have an experienced local agent who can help you navigate the changes in mortgage interest rates and inventory.