Rabbit Nest

Post by FM Derana.

12,575 Houses Sold Yesterday!

by The KCM Crew on April 23, 2014

If you read certain headlines, you might be led to believe that the housing recovery has come to a screeching halt. Naysayers are claiming that rising mortgage rates and a lack of consumer confidence are keeping Americans on the fence when it comes to purchasing real estate. That is actually far from reality.

After all 12,575 houses sold yesterday, 12,575 will sell today and 12,575 will sell tomorrow. 12,575!

That is the average number of homes that sell each and every day in this country according to the National Association of Realtors’ (NAR) latest Existing Home Sales Report. According to the report, annualized sales now stand at 4.59 million. Divide that number by 365 (days in a year) and we can see that, on average, over 12,500 homes sell every day.

If you are considering whether or not to put your house up for sale, don't let the headlines scare you. There are purchasers in the market and they are buying - to the tune of 12,575 homes a day. 

Thinking of Buying a Vacation/Retirement Home? Why Wait?

by The KCM Crew on April 15, 2014

The sales of vacation homes skyrocketed last year. A recent study also revealed that 25% of those surveyed said they’d likely buy a second home, such as a vacation or beach house, to use during retirement. For many Baby Boomers, the idea of finally purchasing that vacation home (that they may eventually use in retirement) makes more and more sense as the economy improves and the housing market recovers.

If your family is thinking about purchasing that second home, now may be the perfect time. Prices are still great. If you decide to lease the property until you’re ready to occupy it full time, the rental market in most areas is very strong. And you can still get a great mortgage interest rate.

But current mortgage rates won’t last forever…

According to FreddieMac, the interest rate for a 30 year fixed rate mortgage at the beginning of April was 4.4%. However, FreddieMac predicts that mortgage rates will steadily climb over the next six quarters.

Let’s assume you want to purchase a home for $500,000 with a 20% down payment ($100,000). That would leave you with a $400,000 mortgage. What happens if you wait to buy this dream house?

Prices are projected to increase over the next year and a half. However, for this example, let’s assume prices remain the same. Your mortgage payment will still increase as mortgage rates climb to more historically normal levels.

Thinking of Buying a Vacation/Retirement Home? Why Wait? This table shows how a principal and interest payment is impacted by a rise in interest rates:

Real Estate: This Spring Will Be Different

Real Estate: This Spring Will Be Different

by The KCM Crew on April 17, 2014

Just like May flowers, every spring the housing market blossoms as buyers come out ready to purchase their dream house. This spring, we believe we are going to see the strongest purchasing market we have seen in a decade.

Why are we so bullish on the housing market this spring?

Here are a few reasons:

MILLENNIALS

Contrary to many reports, this age demographic is READY, WILLING and ABLE to become homeowners. As a matter of fact, the latest National Association of Realtors’ gender study revealed that the Millennial generation has recently accounted for a greater percentage of all buyers than any other generation.

BABY BOOMERS

As prices have risen, so has the equity in many homes across American. Homeowners, having been shackled to their house because of low or negative equity for the last several years, are again free to make a move without worrying about bringing cash to a closing table in order to sell. We believe this new-found freedom will release a pent-up demand of sellers who want to move-up to the home they’ve always dreamed of or want to downsize their primary residence and also purchase a second home they can use for vacation, retirement or both.

BOTH PRICES and MORTGAGE RATES are on the RISE

As the economy improves, more and more Americans are regaining faith that their own personal finances are headed in a positive direction. With this new confidence, they want to take advantage of the opportunity that presents itself with real estate still undervalued in most parts of the country and mortgage rates being well below historic numbers.

The Price of a Home and the Cost of Waiting to Purchase

by Joe Brant on April 7, 2014

In recent months, as the housing industry is recovering and mortgage interest rates have begun to rise, we are hearing about the price of homes increasing and the cost of homes is going up. It would be easy to just think “well of course, if the price anything goes up it will cost more and that’s just the way it is”. But these terms, price and cost, are not one and the same when we are speaking about a combination of factors, in this case a home and  the interest rate charged for it’s mortgage, then add in a time factor.

Last month, a nationwide panel of over a hundred economists, real estate experts, and investment & market strategists projected that home values would appreciate by approximately 8% from now to the end of next year.

In addition, Freddie Mac’s most recent Economic Commentary & Projections Table predicts that the 30 year fixed mortgage rate will be 5.7% by the end of 2015.

The projected percentage home price appreciation from now to the end of next year is about 8%, or $20,000 on a home currently valued at $250,000. Note that this rate of appreciation will not occur evenly across the state or country. Some areas will appreciate faster and some slower. At the time of this writing, the average commitment rate per Freddie Mac is 4.41%. This is projected to increase to 5.7% by the end of 2015.

What does this mean to someone planning to purchase a home within the next year or two? Below is an example of the impact these projected changes would have on the mortgage payment for a $250,000 home if purchased today, or the same home purchased at the end of 2015.  By waiting until the end of next year to buy, the difference in monthly payment amounts to $313.70 per month, or a total of $112,932 over the life of a 30 year fixed loan.

This Month in Real Estate - April 2014

Internet Marketing - Targeting Real Estate Buyers

Over 90% of home buyers begin their search for a home online, and in order to properly serve our home sellers it is essential that our presence on the internet search engines is strong.  This helps maximize the potential for your home to be found quickly on the internet.

In today's market it is critically important to ensure your home receives excellent exposure in all marketing areas, especially on the internet.  Keller Williams Realty provides us with the cutting edge tools and training to showcase your home in the manner it deserves, providing virtually 100% exposure for our listings.

For additional information, call me at 252-675-3038 or email Joe@JoeBrant.com.