Laying the groundwork for the best mortgage
With mortgage rates having doubled what they were in early 2022, getting the lowest rate possible could mean the difference in being able to buy a home or at the very least, makes it much more affordable. Some people are waiting for rates to come down and while they are expected to come down some this year, most experts agree that they’ll never return to the three or even four percent range. There are things that a buyer can do to be eligible for the best rate available. Obtaining the most favorable terms is based on the loan-to-value,...
read moreHandling an Appraisal Gap
An appraisal gap describes the difference between the sales price and the lower amount of the appraisal required by the mortgage being obtained by the buyer. It becomes an issue if the seller is not willing to lower the price or the buyer is not willing to pay the difference in cash. Looking at the issue from the seller’s perspective, "if the buyer wants my home and he can’t get the loan he wants, he’ll have to make up the difference in cash." The buyer might have a different view like "If an independent...
read moreMake your home offer the most appealing
Sales in March 2023 were down 2.4% month over month and still down 22.0% year over year according to the NAR Housing Snapshot. The median sales price dipped 0.9% to $375,700 and there are 2.6 months supply of homes on the market compared to 2 months a year ago. "Inventory levels are still at historic lows, and consequently, multiple offers are returning on 28% of properties." According to Lawrence Yun, Chief Economist for the National Association of REALTORS�. It is still important to have a strategy for potentially competing with...
read moreProtect yourself with a new construction inspection
Builders of new homes offer or are required to warrant their work for a specified period. Municipal inspections are generally required during different stages to "ensure the life, health, safety, and welfare of the public" but even if something is missed, the ultimate responsibility for building to code belongs to the builder, even if the municipal inspector misses something. There are four basic stages of residential construction including: The foundation stage begins with excavation, footings, foundation walls or slab,...
read moreHigher Interest Rates May be the Help You Need
Like opening and closing a faucet increases and decreases the water flow, lowering interest rates increases home sales and raising interest rates decreases home sales. When home sales increase during periods of limited inventory, demand increases and prices go up. Contrarily, when home sales decrease, demand could lessen and prices moderate. There is opportunity with higher rates because it affects sales and demand, which in turn keeps prices in check. By waiting for rates to come down, and no one knows by how much but certainly not to the...
read moreShopping Mortgage Rates
Nobel Prize recipient, Richard Thaler, in his research into seemingly irrational economic behaviors, "found that consumers generally search too little, get confused while evaluating complex alternatives, and are slow to switch from past choices, even if it costs them." "Why are consumers leaving money on the table?" Based on this behavior, a borrower securing a mortgage might depend on their existing banking relationship or a single referral from a friend or agent rather than shopping multiple lenders. When shopping for a...
read moreWho Benefits from Selling a Home “As Is”?
A person’s decision to sell their home comes with a lot of other decisions causing an owner to stress or procrastinate. Early in the process, the owner will consider selling the home "As Is" to avoid the looming issues that accompany selling a home. From a seller’s standpoint, "as is" means the buyer will purchase the home in its current condition without asking for any repairs. While it is convenient for the seller to take this approach, the normal trade out is the property will not result in the highest...
read moreA Lesson on Housing from the 80’s
Doing nothing may be a lot more costly than doing something. With rates twice what they were in 2021 and the first half of 2022, many buyers are sitting on the sideline. For some, it has to do with not being able to afford the home they want at today’s mortgage rates and for others, it is not willing to accept that the low rates that were available are not only gone, but may never be available again. In the late 70’s, rates were around 10% and in the early 80’s went up to 18%. Interestingly, many buyers went ahead and...
read moreMake Your Home Offer the Most Appealing
Sales in February 2023 were up 14.5% month over month and still down 22.6% year over year according to the NAR Housing Snapshot. The median sales price dipped 0.2% to $363,000 and there are 2.6 months supply of homes on the market compared to 1.7 months a year ago. "Inventory levels are still at historic lows, and consequently, multiple offers are returning on a good number of properties." According to Lawrence Yun, Chief Economist for the National Association of REALTORS�. It is still important to have a strategy for potentially...
read moreA New Perspective on the Housing Market
The housing market in 2021 and part of 2022 was anything but normal. Mortgage rates were at all time lows and may never reach those levels again. Double-digit appreciation drove prices to new heights. Low inventories fueled by high buyer demand made multiple offers a normal expectation. As we look at the market snapshots provided by MLS in the various markets across the U.S., it appears that things may be returning to normal, but not necessarily in all areas. While there are more homes on the market now than a year ago, there are less sales...
read more