Your "Local" Specialist Blog

February 10th, 2016 10:13 AM

Do You Know How Much Equity You Have In Your Home? You May Be Surprised!

Posted: 10 Feb 2016 04:00 AM PST

Do You Know How Much Equity You Have In Your Home? You May Be Surprised! | Keeping Current Matters CoreLogic’slatest Equity Report revealed that 256,000 properties regained equity in the third quarter of 2015. This is great news for the country, as 92% of all mortgaged properties are now in a positive equity situation.

Price Appreciation = Good News For Homeowners

Frank Nothaft, CoreLogic’s Chief Economist, explains:
“Home price growth continued to lift borrower equity positions and increase the number of borrowers with sufficient equity to participate in the mortgage market. In the last three years, borrowers with at least 20 percent equity have increased by 11 million, a substantial uptick that is driving rapid growth in home equity originations.” 
Anand Nallathambi, President and CEO of CoreLogic, believes this is a great sign for the market in 2016 as well, as he had this to say:
“Homeowner equity is the largest source of wealth for many Americans. The rise in home prices, expected to be at least 5% in 2016, will continue to build wealth and confidence across America. As this process continues, it will provide support for the housing market and the broader economy throughout [the] year.”

This is great news for homeowners! But, do they realize that their equity position has changed?

study by Fannie Mae suggests that many homeowners are not aware that they have regained equity in their home as their investment has increased in value. For example, their study showed that 23% of Americans still believe their home is in a negative equity position when, in actuality,CoreLogic’s report shows that only 8% of homes are in that position (down from 9% in Q2). The study also revealed that only 37% of Americans believe that they have “significant equity” (greater than 20%), when in actuality, 74% do!Do You Know How Much Equity You Have In Your Home? You May Be Surprised! | Keeping Current Matters This means that 37% of Americans with a mortgage fail to realize the opportune situation they are in. With a sizeable equity position, many homeowners could easily move into a housing situation that better meets their current needs (moving to a larger home or downsizing). Fannie Mae spoke out on this issue in their report:
“Homeowners who underestimate their homes’ values not only underestimate their home equity, they also likely underestimate 1) how large a down payment they could make with their home equity, 2) their chances of qualifying for mortgages, and, therefore, 3) their opportunities for selling their current homes and for buying different homes.”

Bottom Line

If you are one of the many Americans who are unsure how much equity you have built in your home, don’t let that be the reason you fail to move on to your dream home in 2016! Meet with a local real estate professional today, who can help you evaluate your situation and assist you along the way!

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on February 10th, 2016 10:13 AMLeave a Comment

Subscribe to this blog
Will Appraisals Continue to be a Challenge in 2016?

Posted: 03 Feb 2016 04:00 AM PST

Will Appraisals Continue to be a Challenge in 2016? | Keeping Current Matters
First American Title issues a quarterly report, the Real Estate Sentiment Index (RESI), which “measures title agent sentiment on a variety of key market metrics and industry issues”. Their 2015 4th Quarter Edition revealed some interesting information regarding possible challenges with appraisal values as we head into 2016.
“The fourth quarter RESI found that title agents continue to believe that property valuation issues will be the most likely cause of title order cancellation over the coming year.”
This shouldn’t come as a surprise. In a housing market where supply is very low and demand is very high, home values increase rapidly. One major challenge in such a market is the bank appraisal. If prices are jumping, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that closed recently) to defend the price when performing the appraisal for the bank. Another monthly report by Quicken Loans measures the disparity between what a homeowner believes their house is worth as compared to an appraiser’s evaluation. Here is a chart showing that difference for each month through 2015. Will Appraisals Continue to be a Challenge in 2016? | Keeping Current Matters

Bottom Line

Every house on the market has to be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. That is why we suggest that you use an experienced real estate professional to help set your listing price.

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on February 9th, 2016 1:42 PMLeave a Comment

Subscribe to this blog
No Matter Which Groundhog You Listen To, You Should Sell Before Spring!

Posted: 02 Feb 2016 04:00 AM PST

No Matter Which Groundhog You Listen to, You Should Sell Before Spring! | Keeping Current Matters
Is spring closer than we think? Depending on which Groundhog you witnessed today, you may have less time than you think to get your home on the market before the busy spring season. Many sellers feel that the spring is the best time to place their home on the market as buyer demand traditionally increases at that time of year. However, the next six weeks before spring hits also have their own advantages. Here are five reasons to sell now. 

1. Demand is Strong

Foot traffic refers to the number of people out actually physically looking at homes right now. The latest foot traffic numbers show that buyers are still out in force looking for their dream home. These buyers are ready, willing and able to buy…and are in the market right now! Take advantage of the strong buyer activity currently in the market. 

2. There Is Less Competition Now

Housing supply just dropped to 3.9 months, which is well under the 6 months’ supply that is needed for a normal housing market. This means, in many areas, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory is about to come to market. There is a pent-up desire for many homeowners to move, as they were unable to sell over the last few years because of a negative equity situation. Homeowners are now seeing a return to positive equity as real estate values have increased over the last three years. Many of these homes will be coming to the market in the near future. Also, new construction of single-family homes is again beginning to increase. A study by Harris Poll revealed that 41% of buyers would prefer to buy a new home while only 21% prefer an existing home (38% had no preference). The choices buyers have will increase in the spring. Don’t wait until all this other inventory of homes comes to market before you sell.

3. The Process Will Be Quicker

One of the biggest challenges of the housing market has been the length of time it takes from contract to closing. Banks are requiring more and more paperwork before approving a mortgage. There is less overall business done in the winter. Therefore, the process will be less onerous than it will be in the spring. Getting your house sold and closed before the spring delays begin will lend itself to a smoother transaction.

4. There Will Never Be a Better Time to Move-Up

If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by 5.3% over the next 12 months according to CoreLogic. If you are moving to a higher priced home, it will wind-up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock-in your 30-year housing expense with an interest rate below 4% right now. Rates are projected to rise by three-quarters of a percent by the end of 2016.

5. It’s Time to Move On with Your Life

Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should? Only you know the answers to the questions above. You have the power to take back control of the situation by putting your home on the market. Perhaps, the time has come for you and your family to move on and start living the life you desire.

That is what is truly important.


Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on February 2nd, 2016 3:03 PMLeave a Comment

Subscribe to this blog
January 28th, 2016 10:41 AM

Where Are Interest Rates Headed This Year?

Posted: 26 Jan 2016 04:00 AM PST

Where Are Interest Rates Headed This Year? | Keeping Current Matters With interest rates still below 4%, many buyers may be on the fence as to whether to act now and purchase a new home, or wait until next year. If you look at what the four major reporting agencies are predicting for 2016, it may make the decision for you. The chart below averages the predictions by quarter. Mortgage Rate Projections | Keeping Current Matters With the exception of Fannie Mae, the experts agree that interest rates will increase by three-quarters of a percentage point, costing you more to pay back your loan.

Bottom Line

Even a small increase in interest rates can put a dent in your family’s wealth.

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 28th, 2016 10:41 AMLeave a Comment

Subscribe to this blog
January 24th, 2016 9:40 AM

Rents Still Skyrocketing

Posted: 20 Jan 2016 04:00 AM PST

Rents Still Skyrocketing | Keeping Current Matters Zillow recently revealedthat the 43 million renter households in the US spent $535 billion on rent in 2015. Aggregate numbers like these often make it difficult to truly assess a situation. For more clarity, we want to share some points that were made in a Wall Street Journal article earlier this month. The article made two important points:

1. Rents are increasing faster than the last several years:

 “Apartment rents increased faster last year than at any time since 2007.”

2. Rent increases are accelerating

“Another report from Axiometrics Inc., a Dallas-based apartment research company, showed that rents increased 4.7% in the fourth quarter compared with the same quarter a year earlier, the strongest year-end performance since 2005”.
Here is a graph to illustrate the rate of increase over the last several years:Average Effective Rent in the US | Keeping Current Matters

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 24th, 2016 9:40 AMLeave a Comment

Subscribe to this blog
Thinking of Buying? Selling? 5 Reasons You Need To Hire A Professsional

Posted: 18 Jan 2016 04:00 AM PST

Thinking of Buying? Selling? 5 Reasons You Need To Hire A Professsional | Keeping Current Matters
Whether you are buying or selling a home, it can be quite an adventurous journey. You need an experienced Real Estate Professional to lead you to your ultimate goal. In this world of instant gratification and internet searches, many sellers think that they can For Sale by Owner or FSBO. The 5 Reasons You NEED a Real Estate Professional in your corner haven’t changed, but have rather been strengthened due to the projections of higher mortgage interest rates & home prices as the market continues to recover.

1. What do you do with all this paperwork?

Each state has different regulations regarding the contracts required for a successful sale, and these regulations are constantly changing. A true Real Estate Professional is an expert in their market and can guide you through the stacks of paperwork necessary to make your dream a reality.

2. Ok, so you found your dream house, now what?

According to the Orlando Regional REALTOR Association, there are over 230 possible actions that need to take place during every successful real estate transaction. Don’t you want someone who has been there before, who knows what these actions are to make sure that you acquire your dream.

3. Are you a good negotiator?

So maybe you’re not convinced that you need an agent to sell your home. However, after looking at the list of parties that you need to be prepared to negotiate with, you’ll realize the value in selecting a Real Estate Professional. From the buyer (who wants the best deal possible), to the home inspection companies, to the appraiser, there are at least 11 different people that you will have to be knowledgeable with and answer to, during the process.

4. What is the home you’re buying/selling really worth?

It is important for your home to be priced correctly from the start to attract the right buyers and shorten the time that it’s on the market. You need someone who is not emotionally connected to your home to give you the truth as to your home’s value. According to the National Association of REALTORS, “the typical FSBO home sold for $210,000 compared to $245,000 among agent-assisted home sales.” Get the most out of your transaction by hiring a professional.

5. Do you know what’s really going on in the market?

There is so much information out there on the news and the internet about home sales, prices, mortgage rates; how do you know what’s going on specifically in your area? Who do you turn to in order to competitively price your home correctly at the beginning of the selling process? How do you know what to offer on your dream home without paying too much, or offending the seller with a low-ball offer? Dave Ramsey, the financial guru advises:
“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”
Hiring an agent who has their finger on the pulse of the market will make your buying/selling experience an educated one. You need someone who is going to tell you the truth, not just what they think you want to hear.

Bottom Line

You wouldn’t replace the engine in your car without a trusted mechanic. Why would you make one of your most important financial decisions of your life without hiring a Real Estate Professional?

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 20th, 2016 5:13 PMLeave a Comment

Subscribe to this blog

When Is It A Good Time To Rent? NOT Now!

Posted: 12 Jan 2016 04:00 AM PST

When Is It A Good Time To Rent? NOT Now! | Keeping Current MattersPeople often ask whether or not now is a good time to buy a home. No one ever asks when a good time to rent is. However, we want to make certain that everyone understands that today is NOT a good time to rent. The Census Bureau recently released their third quarter median rent numbers. Here is a graph showing rent increases from 1988 until today:Median Asking Rents | Keeping Current MattersA recent Wall Street Journal article reports that rents rose “faster last year than at any time since 2007, a boon for landlords but one that has stoked concerns about housing affordability for renters.”  The article also cited results from a recent Reis Inc report which revealed that average effective rents rose 4.6% in 2015, the biggest gain since before the recession. Over the past 15 years, rents have risen at a rate of 2.7% annually.

Where are rents headed?

Jonathan Smoke, Chief Economist at realtor.com recently warned that:
“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.” 

Bottom Line

According to the WSJ article:
“In general, the higher rents go, the more difficult it will be for young people to save for down payments, making them likely to rent even longer.”
One way to protect yourself from rising rents is to lock in your housing expense by buying a home. If you are ready and willing to buy, meet with a local real estate professional who can help determine if you are able to today!

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 16th, 2016 11:22 AMLeave a Comment

Subscribe to this blog

The Most Appealing Aspects of Homeownership

Posted: 14 Jan 2016 04:00 AM PST

The Most Appealing Aspects of Homeownership | Keeping Current Matters The National Association of Realtors(NAR) just released their first issue of the Housing Opportunities & Market Experience Survey (HOME). In the report, NAR revealed what Americans believe to be the most appealing aspects of homeownership.

Here is a graph showing the results:

The Most Appealing Aspects of Homeownership | Keeping Current Matters It is interesting to see that the two most appealing aspects had nothing to do with money, but instead, addressed the non-financial benefits of homeownership.

Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 14th, 2016 10:55 AMLeave a Comment

Subscribe to this blog
Tue Jan 5, 2016 12:45 PDT

An improving economy is expected to boost housing-market stability in 2016


Most analysts say that the mortgage industry will need a strong year for home-purchase loan volume in 2016 to make up for an expected large drop in refinances. So how is the housing market doing?

The latest flurry of housing data for October and November brought the usual mixture of good and bad news. The longer view suggests that the market continued to recover solidly in 2015, though some weakness and uncertainty remains, analysts told Scotsman Guide News. The outlook for 2016 is generally positive. 

“We still have some vestiges of distress, but for the most part, 2015 was a very strong market,” RealtyTrac’s Vice President Daren Blomquist said. “I don’t know if normal is the right word, but it was a strong market after a soft patch in 2014.”

More economists are starting to refer to “a normal market” for existing homes. In 2015, the home-sales rate topped 5 million for eight consecutive months from March through October, before tumbling steeply in November.

Existing sales, which account for nearly 95 percent of all home sales, fell by 10.4 percent in the month to an annual rate of 4.76 million, according to the National Association of Realtors (NAR).

NAR economists say the big drop in November was likely a temporary blip caused by delays in closings at the end of the month due to the industry adjusting to the new federal consumer-disclosure rules under TRID. NAR is forecasting that sales will end the year 7 percent higher than in 2014. Sales also are projected to increase in 2016, although at a slower pace of around 3 percent.

“The big picture trend for the housing market is up,” NAR analyst Danielle Hale said. "It is moving up a little more sideways in recent months."

NAR’s pending home-sales index, which is based on signed contracts, consistently in 2015 predicted sales in the range of 5 million to 5.5 million, similar to the level in the early 2000s.

“It is right where we should be,” said First American’s Chief Economist Mark Fleming. “The existing-housing market, in terms of number of home sales, shouldn’t be 6 million. It should be right around 5.5 million, so we are pretty close there.”

Mortgage delinquencies and foreclosures are also steadily falling. CoreLogic reported 34,000 completed foreclosures in October, which remains higher than the monthly average of 21,000 before the downturn, but it's still down 27 percent from one year earlier. Seriously delinquent mortgages also have fallen to the lowest level since December 2007, the company said.

On a national basis, home prices rose 6.3 percent in November year over year, CoreLogic reported. Various other price studies have pegged the yearly gain at 5 percent to over 6 percent. Home prices have reached new peaks in a few markets. Black Knight Financial Services reported this week that its home-price index in October was just 5.3 percent below the 2006 peak for the index.

As home values have risen, the number of underwater homeowners — individuals who owe more on a mortgage than the house can fetch on the market — declined steeply. In the past third quarter, an estimated 256,000 homes regained equity.

Underwater homes accounted for 8.1 percent of all homes with a mortgage in the third quarter, down from 22 percent in third-quarter 2012. The diminishing number of underwater properties bodes well for future sales as many of these homeowners have been unable to sell since the downturn, analysts say.

Blomquist said overall home sales were on pace through November for the best year since late 2007. He also noted that applications for Federal Housing Administration (FHA) loans have risen dramatically, an indicator that credit has become more available and first-time homebuyers have been out buying houses.

Blomquist said that rising prices in some markets are a cause for concern, however.

“The red flag out there is affordability,” Blomquist said. “If interest rates go up too quickly, like to 5 percent, then that could really have a chilling effect because we are already at affordability ceilings in many markets.”

Not quite fully recovered

One weak link in the housing market has been a dearth of new-home construction, and thus lower sales of new homes. Sales have generally picked up through the year, but are running at half the rate of 2000 and 2001, when nearly 1 million newly built homes were sold. New-home sales rose in November to an annual rate of 490,000, which is far below the peak of around 1.2 million sales in 2005.  

Rising interest rates also concern analysts. Forecasters are expecting long-term rates to rise anywhere from 30 to 70 basis points and end 2016 at 4.3 percent to 4.7 percent. Market analysts universally say that even a small jump in rates will hurt the market for refinances, but opinions differ on the impact on home-purchase sales.

In its latest forecast in December, the Mortgage Bankers Association (MBA) predicted that refinance volume will drop by nearly 36 percent in 2016, to $415 billion, whereas home-purchase volume will increase by 10 percent over the 2015 total to $905 billion this year.  

Rising mortgage rates could put homes out of reach for some first-time homebuyers, Hale said, but the improved economy that has added roughly 200,000 jobs a month should cancel most of the ill effects of rising rates on sales.

“What we expect is that the recovering economy with the new jobs that are added, and income growth that we are finally starting to see, should be enough to help keep demand steady, but we won’t see the big pickup in existing home sales that we saw this year,” Hale said. 


Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 12th, 2016 8:38 PMLeave a Comment

Subscribe to this blog
January 12th, 2016 8:34 PM

How to Save For a Down Payment

Saving up to buy a house can seem overwhelming but with a few simple steps you’ll be on your way to the closing table in no time! Very few people have the means to immediately pay off their home in full and therefore must apply for a mortgage. A down payment is the percentage you can afford to pay upfront for your home at the time of the purchase.  

There are several options to mortgage financing. Conventional no MI (mortgage insurance) requires 80% LTV (loan to value) and a down payment of 20%. For borrowers with less cash on hand other great programs are available to fulfill your home buying goals. The Conventional loan offers up to 97% loan to value. FHA (Federal Housing Authority) offers homebuyers a 3.5% down payment requirement and more flexible lending requirements. The VA loan offers Active duty, Veterans and National Guard with up to 100% financing. VHDA (Virginia Housing Development Authority) offers homebuyers a down payment of up to 101.5%. All programs differ in eligibly and guidelines.

For example, if you’re buying a home for $300,000 and your mortgage requires you to pay 20% of that your down payment would be $60,000. All programs differ in eligibly and guidelines. To find out more about your mortgage and down payment options contact Advance Financial Group today. For ways to save check out the steps below.  

Determine What You Can Afford

Know before you go! Before you fall in love with a home it’s important to determine what loan program is right for you, and what monthly payment you’re comfortable budgeting. Getting pre-approved upfront will help make sure you start your search in the right direction. To get pre-approved today click here.

Establish a Monthly Budget

To ensure you have money saved establish a monthly budget. Start by creating a spreadsheet that shows your monthly gross income and your expenses for each month.  Set time aside each month to review your budget and spending habits and determine where you can cut costs. 

Here is a free budget spread sheet for you to use.

Cut Out Unnecessary Costs

After establishing your monthly budget you should have a good idea of what expenses can be cut. You will find a vast improvement in your monthly savings by simply cutting out unnecessary costs. According to the Washington Post cutting down on daily coffee runs, packing your own lunch and cooking more meals at home could help you save over $3,000 dollars annually.

Create Your House Fund

Create a separate savings account specifically for your down payment. Set an amount to automatically transfer from your paycheck into your house fund. You will be surprised at how fast your money adds up!


Posted in:General
Posted by Cheryl Talbot ABR,GRI,e-PRO,SFR on January 12th, 2016 8:34 PMLeave a Comment

Subscribe to this blog

Archives:

My Favorite Blogs:

Sites That Link to This Blog: