Tag Archives: buying a home

Start 2017 Off Right… List Your House for Sale

Start 2017 Off Right… List Your House for Sale | MyKCM

As we are about to bring in the New Year, families across the country will be deciding if this is the year that they will sell their current house and move into their dream home. Many will decide that it is smarter to wait until the spring “buyer’s market” to list their house. In the past, that might have made sense. However, this winter is not like recent years.

The recent jump in mortgage rates has forced buyers off the fence and into the market, resulting in incredibly strong demand RIGHT NOW!! At the same time, inventory levels of homes for sale have dropped dramatically as compared to this time last year.

Here is a chart showing the decrease in inventory levels by category:

Start 2017 Off Right… List Your House for Sale | MyKCM

Bottom Line

Demand for your home is very strong right now while your competition (other homes for sale) is at a historically low level. If you are thinking of selling in 2017, now may be the time.

Home Sales Accelerate During The “Dog Days of Summer” [INFOGRAPHIC]

Home Sales Accelerate During The “Dog Days of Summer” [INFOGRAPHIC] |MyKCM

Some Highlights:

  • Existing home sales have accelerated to the highest pace since February 2007 at an annual pace of 5.57 million.
  • Inventory of homes for sale remains below the historically normal 6-month mark at a 4.6-month supply, down 5.8% year-over-year.
  • Median home sales prices rose to $247,700, 4.8% higher than a year ago and replaced the previous peak in May of $238,900.

Thinking of Selling Your House? Pick the Right Agent!

Thinking of Selling Your House? Pick the Right Agent! | MyKCM
Today, more and more sellers are stepping back, taking a look at the advice real estate professionals give them, and asking themselves whether they can trust that advice. And that is exactly what they should do.

The most important question you can ask when you are choosing a real estate agent is whether you feel you can trust them. You must know that they’re giving you great advice, and that they’re going to be able to help you accomplish your family’s goals. You must trust your listing agent enough to allow them to:

  • Handle the liquidation of possibly the largest asset your family has
  • Help set the market value of that asset (get the price right)
  • Set the timetable for the liquidation of that asset
  • Set a fair fee for the services required to liquidate that asset

All four of these require a tremendous amount of trust. They’re going to sell your prized possession, set its value, set a time schedule as to when your family will be able to move, and determine the fee that you’re going to pay to get those three things accomplished.

You have to trust your agent enough to allow them to help you and your family reach your dreams.

Whether you’re a grandfather up North looking to move to Florida to spend your later years with your grandkids, or a young person who wants to take that job in San Francisco but first has to get your house sold in Chicago, you need an agent you can trust to help you move on with what’s important.

Where Are Home Prices Headed Over the Next 5 Years?

Where Are Home Prices Headed Over the Next 5 Years? | MyKCM

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey.

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts, and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey:

Home values will appreciate by 4.5% over the course of 2016, 3.6% in 2017 and about 3.2% in the next two years, and finally 2.9% in 2020 (as shown below). That means the average annual appreciation will be 3.5% over the next 5 years.

Projected Appreciation | MyKCM

The prediction for cumulative appreciation increased slightly from 17.5% to 18.7% by 2020. The experts making up the most bearish quartile of the survey are still projecting a cumulative appreciation of 11.1%.

Cumulative Price Appreciation | MyKCM

Bottom Line

Individual opinions make headlines. We believe the survey is a fairer depiction of future values.

 

‘Old Millennials’ Are Diving Head-First into Homeownership [INFOGRAPHIC]

‘Old Millennials’ Are Diving Head-First into Homeownership [INFOGRAPHIC] | MyKCM

Some Highlights:

  • ‘Old Millennials’ are defined as 25-36 year olds according to the US Census Bureau.
  • According to NAR’s latest Profile of Home Buyers & Sellers, the median age of all first-time home buyers is 31 years old.
  • More and more ‘Old Millennials’ are realizing that homeownership is within their reach now!

Whether You Rent or Buy, You’re Paying a Mortgage

Whether You Rent or Buy, You’re Paying a Mortgage | MyKCM

There are some people that have not purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent free, you are paying a mortgage – either yours or your landlord’s.

As The Joint Center for Housing Studies at Harvard University explains:

“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return.  

That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”

Christina Boyle, a Senior Vice President, Head of Single-Family Sales & Relationship Management at Freddie Mac, explains another benefit of securing a mortgage vs. paying rent:

“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.”

As an owner, your mortgage payment is a form of ‘forced savings’ which allows you to have equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person with that equity.

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were 3.43% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

Housing Market Slowing Down? Don’t Tell Builders!

Housing Market Slowing Down? Don’t Tell Builders! | MyKCM

Many experts have been calling upon home builders to ramp up construction to help with the lack of existing inventory for sale. For the past two months, new home sales have surged, with July’s total coming in at the highest since October 2007.

The latest estimates from the US Census Bureau and Department of Housing and Urban Development show that sales in July were 31.3% higher than this time last year, and 12.4% higher than last month, at a seasonally adjusted annual rate of 654,000. 

Zillow’s Chief Economist, Svenja Gudell, echoed the reaction of some as she commented:

“July(‘s) new home sales data was a surprise, but a welcome one. For years, the market has been practically begging builders to both ramp up their efforts overall and to put more focus on serving the less expensive end of the market. Today’s data confirms both are happening in earnest.”

The National Association of Home Builder’s (NAHB) Chairman, Ed Brady, didn’t seem as surprised:

“This rise in new home sales is consistent with our builders’ reports that market conditions have been improving. As existing home inventory remains flat, we should see more consumers turning to new construction.”

NAHB’s Chief Economist, Robert Dietz, believes this is just the start for new home sales if market conditions continue:

“July’s positive report shows there is a need for new single-family homes, buoyed by increased household formation, job gains and attractive mortgage rates. This uptick in demand should translate into increased housing production throughout 2016 and into next year.”

The existing home sales numbers for July will be released today and will shed more light on the overall health of the housing market.

Bottom Line

New home sales hit their highest mark in over 9 years. Buyers are out in force to find a home that fits their needs. Many are turning to new construction, as the inventory of existing homes has not been able to keep up with demand.

6 Reasons You Should Get Pre-approved For A Mortgage

mortgage-preapproval-01

(courtesy lighterside-staff-authorBy Lighter Side Staff  |  S.D. Shank )

Shopping for a home before getting pre-approved for a mortgage is like walking into a grocery store without a wallet. You may have the desire to buy, but you lack the ability. Let’s cover some basics…

What is a mortgage pre-approval?

In a nutshell, a mortgage pre-approval is written assurance from a lender or broker that you’re able to borrow money to purchase a home up to a certain amount. It’s based on the income, employment and asset documentation you supply at the time of application, in conjunction with your credit history.

1. Without it, most agents won’t work with you.

Makes sense, too. Right? Think about it: when you hire an agent, he/she will invest countless hours showing you homes over the course of your house hunt. If you were in their shoes, wouldn’tyou want assurance that your hard work would lead to a favorable outcome for both you and your client?

2. You’ll know how much house you can afford.

Getting pre-approved before you begin house hunting allows you to know how much house you can realistically afford. Knowing this narrows down the options and makes the selection process more efficient. Not to mention, it protects you from the unpleasant surprise of realizing the home you fell in love with doesn’t fit your budget.

3. It adds clout to your offer.

In many markets, homes attract more than one offer. If the sellers are weighing one offer against another, they may lean towards the one accompanied by a pre-approval letter. That’s because pre-approvals instill confidence that the buyer is financially capable of purchasing their home.

4. It could increase your negotiating power.

In addition to strengthening your offer when compared to buyers who haven’t taken this step, getting pre-approved may give you the upper-hand when negotiating the price. If the homeowner is eager to sell, they may be more willing to accept a lower offer from someone they’ve been assured is financially capable of purchasing their home.

5. It saves time.

Obtaining a mortgage is a lengthy process. Getting pre-approved ahead of time shortens the time between contract to close — this way you’re ready to proceed with finalizing the mortgage once you’ve found the home you want to purchase.

6. It carries more weight than a “pre-qualification”.

A pre-approval differs from a pre-qualification. With the former, the lender has actually checked your credit and verified your documentation to approve a specific loan amount (usually for a particular time period such as 30, 60 or 90 days). A pre-qualification can be useful as an estimate of how much you can afford to spend on your home, but it’s a less accurate indicator of your ability to purchase. A pre-approval always carries more weight.