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Check it out… buying vs renting
This New York Times articles suggest buying is better than renting and it even has a handy, dandy calculator to figure it out!
http://www.nytimes.com/interactive/business/buy-rent-calculator.Html#!
200 Viewings & No Offers!
I’m totally swiping (I mean re-posting) this article. Sometimes clients don’t like what we have to say but we still have to say it!
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Posted by Paul Pastore September 6 – Filed in Sales Stretegies and Tactics – 487 views
200 Viewings & No Offers!
Recently, I listed a house that had been on the market with another agent for sixty days. The seller said there were over 200 viewings, including a few open houses. When I asked the seller why they felt the home did not attract an offer they were unsure and bewildered. Now, stop reading and tell me why you feel the property didn’t sell, even though you never saw this home.
Would it help if I mentioned this property was in great condition, in a gated, golf, active adult community? What about if I told you the property was free and clear, on the golf course, and the reason the seller was selling was because they downsized to a smaller home in the same area.
If you said, “Duh, the primary reason a home remains unsold is improper pricing”; you’d be right. Proper pricing makes salesmanship superfluous.
The seller fired their first agent due to ‘personality issues’. Some times this means the agent had the courage to tell the seller something they didn’t want to hear. Other times the agent chose to take an overpriced listing and confront reality at a later date. Honesty is always the best policy.
After taking the listing at a lower price, I called the former agent and asked why she felt the property did not sell. She said it was priced too high and the seller was difficult to work with. She said it was worth 50k below their initial price. I thanked the agent for info, and then shared this number with the seller.
If a house fails to attract showings, or receives many showings but no offers, the price is too high. The art of listing is knowing how to communicate data to a seller who, at times, is reluctant to digest the facts. Digestion can be a slow process. But, honesty is not negotiable.
Should I Wait for Interest Rates to Come Back Down?
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Should I Wait for Interest Rates to Come Back Down? Posted: 03 Sep 2013 04:00 AM PDT
Some buyers are waiting to see if interest rates will come back down before making a decision about buying a home. Though no one can guarantee where rates will be in a few months, we don’t believe waiting is a good strategy. Most experts believe rates may actually move higher. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will continue to climb. With home prices increasing and interest rates projected to also increase, the cost of buying a house could quickly increase rather dramatically. |
Above is a graph of the movement of the 30 year fixed mortgage rate since the beginning of 2012.Thinking about buying or selling an acreage?
Are you thinking about buying or selling an acreage in the near or not to distant future? Let me add to the long line of items you should be thinking about… now you need to think about water. Well water vs. rural water.
Now I’m not here to get into a debate on which is healthier, or better, or more cost effective… my concern lies in your financing or that of your buyer’s financing if you’re selling. Apparently our great government is now getting involved in water and they are going to have some say in the water supply to properties they finance.
So, on FHA, VA, USDA loans there will now be new requirements & standards if/when rural water is available. Myself and other Realtors, and our local lenders are just hearing about this stuff now too. Below you’ll find the new guidelines and I’ll try to keep you updated as we run into this more and more and how it works out!
Here is the overview of the requirement from FHA.
Note: The appraiser shall indicate whether a public water or sewage disposal system is available to the site. If available, connection must be made to public or community water/sewage disposal system if connection costs are reasonable. The lender will determine whether connection is feasible.
Individual water supply systems (wells) may be acceptable when connection to a public or community water system is not available and there is assurance of a continuing adequate supply of safe potable water for domestic needs.
A water test or inspection is required
– if it is mandated by the State or local jurisdiction;
– if there is knowledge that well water may be contaminated;
– when the water supply relies upon a water purification system due to the presence of contaminates; or
– when there is evidence of corrosion of pipes (plumbing), areas of intense agriculture within 1/4 mile, coal mining or gas drilling operations within a 1/4 mile, dump, junkyard, landfill, factory, gas station or dry cleaning operations within 1/4 mile, or objectionable taste, smell or appearance of the water.
REFERENCE
ML 05-48; Handbook 4150.2 Section 3-6A.5
And here are the requirements which can be made by VA. It would be on the NOV for VA, so up to the appraisal underwriter in St. Paul.
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5. WATER/SEWAGE SYSTEM ACCEPTABILITY. Evidence from the local health authority or other source authorized by VA that the individual _____ water supply, _____ sewage disposal system(s) is/are acceptable. |
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6. CONNECTION TO PUBLIC WATER/SEWER. Evidence of connection to _____ public water, _____ public sewer, if available, and that all related costs have been paid in full. |
Therefore, it is not absolutely required to hook up to Xenia, but it could be depending the decision of the Underwriter. The last FHA we had, the cost was deemed to be too much and it was not required.
The COST of a Home: Last year… this year… next year
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The COST of a Home: Last Year, This Year & Next Year Posted: 26 Aug 2013 04:00 AM PDT
LAST YEARThe median priced home in the country was selling for $187,800. The 30-year fixed mortgage rate was at 3.5%. Here is what it would cost to buy a home last year:
TODAYThe median priced home in the country is selling for $213,500. The 30-year fixed mortgage rate is at 4.5%. Here is what it would cost a purchaser to buy a home today:
The monthly cost increased by: $190.78! NEXT YEARProjecting into the future in real estate can be rather tricky. To establish future pricing, we depended on the over 100 housing experts surveyed for the Home Price Expectation Survey who called for an approximate appreciation rate of 5% over the next twelve months. For the interest rate, we took the average of the projections from the Mortgage Bankers’ Association, Freddie Mac and Fannie Mae. Here is what these experts project will be the approximate cost of a home a year from now:
The monthly cost will increase by about: $97.32! Bottom LineFrom a financial perspective, why wait if you are thinking about buying? |
The cost of a home is determined mainly by two components: price and mortgage rate. Today, we want to show how the monthly cost of purchasing a median priced home has changed over the last twelve months and how it might change over the next twelve months. For the first two examples, we will be using the National Association of Realtors’ (NAR)Existing Home Sales Report to establish median price and Freddie Mac’s Primary Mortgage Market Survey to establish mortgage rate. We also assumed a 20% down payment in all examples.
A Message to Millennials…
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A Message to Millennials for Our Future Posted: 15 Aug 2013 04:00 AM PDT Toda, we are honored to have Justin DeCesare, CEO of Middleton & Associates Real Estate in La Jolla, as our guest blogger. Justin has written a manual for new agents that is a must read for the new technology centered Real Estate market. It is available online in both print and Kindle editions. – The KCM Crew
Everything from the PRISM scandal to the everyday politically motivated Washington gridlock on items such as student loan rates have left many of us feeling weary of our place in the political and economic infrastructure. In Walter Hickey’s article on Business Insider, he quoted President Obama in his recent interview with Zillow CEO Spencer Rascoff as saying:
While I don’t think this quote was meant to minimize the economic struggle of Millennials, it just seems to add to the stream of media attention that fails to see the impact we will have on the overall recovery. We are at a turning point in our society. Prices have bottomed, affordability indexes are low, and jobs are coming back on line. No matter your age, if you have the financial ability to buy a house, do so right now. Not a year from now…right now. By the time the media finally says Millennials are buying houses, they will be a year behind in their reporting. Take Action. Today.Whoever thinks they have a crystal ball is lying to you. No one knows exactly what will happen with the government’s bond buying programs or new housing starts and inventory. However, we do know this:
To my Co-Gen-Yers who may come across this blog: Lifelong wealth is created with a certain amount of risk; however, if you fail to take that risk you will always be stuck in your present situation. Years from now, there will be people who look back and think to themselves, “I should have bought when I could…That was the perfect time to buy.” Every type of Real Property is going to appreciate over a 10-20 year period, from commercial buildings, to multi-units, to single family homes. Our generation is set to play an important role in our economy as there is an ever-growing necessity for technologically advanced degrees and laborers. It is up to you as to whether or not you want this economic growth to shape the rest of your own personal life as well. Much like the greatest generation at the close of WWII, we have a duty to re-establish a vibrant economy. No one else will do it for us. I realize the economy has not yet fully recovered. But, if everything the media and the politicians say is true, none of us will own houses or have babies until our 50s. No matter what any pundit says, it is going to take young business people, humanitarians, laborers, and entrepreneurs to take the lead and recreate an America that the Greatest Generation would be proud of. Leave the cynicism to someone else. It fails in action as much as it does in belief. Now, it’s our turn. |
I spend a lot of time defending the work habits and dedication of my generation. Yet, I still wonder at times why we aren’t all as cynical and jaded as the media would like to portray us.It does the soul good…
It does the soul good, well my soul anyway! “It” was a day of doing things I wanted to do… not things I had to do, or needed to do but wanted to do. Now don’t get too excited I didn’t do everything I wanted to do, nor did I do anything too exciting. It was just a nice day of stuff.
Stuff like washing all of the blankets in the house, straightening some of my signs, cleaning out my fridge, planning an “outside the box” Realtor open house, creating a new pasta dish, deleting a ton of old emails, going on a long walk, sorting through my work bag (think briefcase), spending a little time outside, actually reading my goals for the year, de-cluttering my laundry room, firing up the smoker & making pulled pork, taking new pictures at one of my listings, picking up all of Bear’s (our chocolate lab) junk he’s strewn over the yard, showing a great house to two young couples, getting a peanut butter malt at Sweet Treats and finally sitting in bed with my laptop & cleaning up Tivo.
Sounds crazy right? Let’s think about a couple of these… my goals for the year are posted everywhere, they’re in my planner, in my closet, on my bathroom wall, they’re my screen saver, they’re in my car, on my desk… you get the picture, they’re everywhere. I see them every day but its been forever since I’ve actually read them & thought about them. Where am I at? What have I accomplished? Am I ahead, on track, behind? What do I need to do to make my goals by year end. I set some pretty ambitious goals for this year and I’m a little behind where I planned to be but now I know that and I know what I need to do by year end.
The fridge was one of those things that irked me every time I opened it. It wasn’t horrible or anything just a little spill here, last weeks left overs there , 3 bottles 1/4 full of Ranch dressing, etc. I’d open up the fridge, notice it and then it would bug me because I was on my way out the door & didn’t have time to fix it. So today I did it – threw out stuff we’ve never opened & obviously won’t, washed & dried all the shelves & drawers and I condensed down to one bottle of Ranch.
The blankets… were they dirty? Probably not but now I know they are clean & fresh. Bear’s junk in the yard… will that be the end of it? No probably not but for one day the yard looks great. The new pasta dish I tried… is it awesome? Eh, it was good but not great. But its one less recipe on my to try list. Will my work bag stay sorted & organized… never! But for a few days I’ll be able to quickly & easily find things in there.
I know, I know, now that I see it in print it doesn’t seem like much and trust me there’s a million more things I could have done. But its truly amazing how together I feel. Just a few things off my mind and I’m ready to get back to my normal grind tomorrow!
The Impact of Rising Interest Rates
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A Few Comments on the Impact of Rising Interest Rates Posted: 14 Aug 2013 04:00 AM PDT
ZillowDr. Svenja Gudell, Senior Economist “As long as mortgage interest rates don’t rise too far and too fast, most markets should be able to absorb these changing dynamics while still remaining healthy.” Fannie MaeDoug Duncan, SVP and chief economist at Fannie Mae: “Consumers have taken the interest rate rise in stride. Expectations for continued improvement in housing persist, and sentiment toward the current buying and selling environment is back on track from its dip last month. These results are consistent with our own analysis of previous housing cycles, which finds that interest rates and home prices are not strongly correlated.” National Association of Realtors (NAR)Lawrence Yun, Chief Economist: “Affordability conditions remain favorable in most of the country, and we’re still dealing with a large pent-up demand. However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market.” |
Here are a few interesting comments on how rising interest rates might impact the real estate market as we move forward.
The Impact of Rising Interest Rates
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A Few Comments on the Impact of Rising Interest Rates Posted: 14 Aug 2013 04:00 AM PDT
ZillowDr. Svenja Gudell, Senior Economist “As long as mortgage interest rates don’t rise too far and too fast, most markets should be able to absorb these changing dynamics while still remaining healthy.” Fannie MaeDoug Duncan, SVP and chief economist at Fannie Mae: “Consumers have taken the interest rate rise in stride. Expectations for continued improvement in housing persist, and sentiment toward the current buying and selling environment is back on track from its dip last month. These results are consistent with our own analysis of previous housing cycles, which finds that interest rates and home prices are not strongly correlated.” National Association of Realtors (NAR)Lawrence Yun, Chief Economist: “Affordability conditions remain favorable in most of the country, and we’re still dealing with a large pent-up demand. However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market.” |
Moving Up? Do it Now!!
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Posted: 05 Aug 2013 04:00 AM PDT
There is no way for us to predict the future but we can look at what happened over the last year. Let’s look at buyers that considered moving up last year but decided to wait instead. Assume they had a home worth $300,000 and were looking at a home for $400,000 (putting 10% down they would get a mortgage of $360,000). By waiting, their house appreciated by 12% over the last year (national average based on the Case Shiller Pricing Index). Their home would now be worth $308,000. But, the $400,000 home would now be worth $448,000 (requiring a mortgage of $403,200). Here is a table showing what additional monthly cost would be incurred by waiting:
If your family sees yourself in this situation, it may make sense to move now than later. Prices are definitely appreciating and interest rates are beginning to rise. |
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