Your Home Sold Guaranteed Realty BlogRecently posted or modified blog posts in the category - Buying a Homehttps://www.homesoldflorida.com/blog/Copyright HomeSoldFlorida.com2024-02-26T01:00:55-07:00tag:homesoldflorida.com,2012-09-20:42089Achieve Your Dream of Homeownership with Condos and Townhomes [INFOGRAPHIC]<img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/assets/image/20240215/20240216-Achieve-Your-Dream-of-Homeownership-with-Condos-and-Townhomes-NM.jpg" />
Some Highlights
If you’re trying to <a href="https://www.keepingcurrentmatters.com/2024/01/19/key-terms-every-homebuyer-should-learn-infographic/" rel="noopener noreferrer" target="_blank">buy a home</a> but are having a hard time finding something in <a href="https://www.keepingcurrentmatters.com/2024/01/18/3-key-factors-affecting-home-affordability/" rel="noopener noreferrer" target="_blank">your budget</a>, here’s something that can help: consider condos and townhomes.
They may better <a href="https://www.realtor.com/news/trends/condo-townhome-biggest-savings-in-these-expensive-cities/" rel="noopener noreferrer" target="_blank">fit your budget</a>, can help you start building equity, and tend to require minimal upkeep and <a href="https://realestate.usnews.com/real-estate/articles/what-should-you-consider-when-deciding-between-a-condo-vs-house" rel="noopener noreferrer" target="_blank">less maintenance</a>.
Looking at condos and townhomes can make it easier to find and buy a home. When you're ready, connect with a local <a href="https://www.keepingcurrentmatters.com/2024/02/09/winning-plays-for-buying-a-home-in-todays-market-infographic/" rel="noopener noreferrer" target="_blank">real estate agent</a>.
2024-02-20T10:10:28-07:002024-02-20T14:03:20-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:42001Why Homeownership Captivates So Many People<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240214-Why-So-Many-People-Fall-in-Love-with-Homeownership.png" title="Chances are at some point in your life you’ve heard the phrase, home is where the heart is." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240214-Why-So-Many-People-Fall-in-Love-with-Homeownership.png" alt="Why So Many People Fall in Love with Homeownership" /></a>
You've likely encountered the saying "home is where the heart is" at some stage in your life, and there's a good reason it's so commonly expressed. The journey to becoming a homeowner is a deeply emotional one. If you're currently grappling with the decision to continue renting or take the leap into homeownership this year, here's why embracing the latter can easily capture your heart.
Customizing to Your Heart’s Desire
Your home should reflect your unique personality, but achieving that can be challenging as a renter. Rental properties often come with standard white paint, limited control over upgrades, and restrictions on wall modifications. However, as a homeowner, you enjoy much greater freedom. According to the National Association of Realtors (NAR):
"The home is yours. You can decorate any way you want and choose the types of upgrades and new amenities that appeal to your lifestyle."
Whether you prefer lively and bright wall colors or a more subdued, moody atmosphere, as a homeowner, you have the freedom to align your interior with your personal style. Imagine the satisfaction of returning home each day to a space that truly embodies your individuality.
Greater Stability for the Ones You Love Most
Renting comes with the challenge of facing uncertainties when your lease ends. Will your rent increase significantly, forcing a move? What if the landlord decides to sell the property? It often feels like you're constantly anticipating the unknown. In an article for Money Geek, Jeff Ostrowski, a business journalist specializing in real estate and the economy, highlights how homeownership can bring a sense of security:
"Owning a home means you are in control and have a significant influence on your lifestyle and family decisions. If your children attend public school and you wish to avoid the risk of them changing schools due to a non-renewed lease, homeownership substantially mitigates the risk of relocation."
A Feeling of Belonging
You may also find you feel much more at home in the community once you own a house. That’s because, when you <a href="https://www.keepingcurrentmatters.com/2024/01/10/avoid-these-common-mistakes-after-applying-for-a-mortgage/" rel="noopener noreferrer" target="_blank">buy a home</a>, you’re staking a claim and saying, I’m a part of this community. You’ll have neighbors, block parties, and more. And that’ll give you the feeling of being a part of something bigger. As the International Housing Association <a href="https://www.internationalhousingassociation.org/fileUpload_details.aspx?contentTypeID=3&contentID=266313&subContentID=721506&channelID=38488" rel="noopener noreferrer" target="_blank">explains</a>:
“. . . homeowning households are more socially involved in community affairs than their renting counterparts. This is due to both the fact that homeowners expect to remain in the community for a longer period of time and that homeowners have an ownership stake in the neighborhood.”
The Emotional High of Achieving Your Dream
Becoming a homeowner is a <a href="https://www.keepingcurrentmatters.com/2023/12/08/your-homebuying-adventure-infographic/" rel="noopener noreferrer" target="_blank">journey</a> – and it may have been a long road to get to the point where you’re ready to take the plunge. If you’re seriously considering leaving behind your rental and making this commitment, you should know the emotions that come with this <a href="https://www.keepingcurrentmatters.com/2023/12/26/get-ready-to-buy-a-home-by-improving-your-credit-score/" rel="noopener noreferrer" target="_blank">owning a home</a> are powerful. You’ll be able to walk up to your front door every day and have that sense of accomplishment welcome you home.
Bottom Line
Your home is an embodiment of your identity, a secure haven for your loved ones, and a tangible representation of your achievements. If you're prepared to transition from renting to homeownership, reach out to a local real estate professional to embark on this journey.
2024-02-15T07:40:46-07:002024-02-20T14:36:49-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:42000Closing the Gaps on the Journey to Homeownership<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240213-Bridging-the-Gaps-on-the-Road-to-Homeownership.png" title="Homeownership is a major part of the American Dream." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240213-Bridging-the-Gaps-on-the-Road-to-Homeownership.png" alt="Bridging the Gaps on the Road to Homeownership" /></a>
Owning a home is a fundamental aspect of the American Dream, yet navigating the journey towards this goal can be notably challenging. Despite advancements in enhancing fair housing access, households of color encounter distinctive hurdles on their path to homeownership. Collaborating with knowledgeable real estate professionals becomes paramount for diverse buyers seeking to overcome these challenges.
Evidently, achieving homeownership proves to be more arduous for specific demographic groups, as there persists a discernible gap between the overall average U.S. homeownership rate and that of non-white groups. Presently, Black households maintain the lowest homeownership rate on a national scale, as illustrated in the graph below:
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240213-Homeownership-Rate.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240212/20240213-Homeownership-Rate.png" /></a>
Homeownership plays a crucial role in wealth accumulation for households, serving as an asset that can be passed down to future generations. A report from the National Association of Realtors (NAR) reveals that nearly half of Black homebuyers in 2023 were first-time buyers, highlighting a significant portion without accumulated home equity for their purchase.
This financial challenge adds complexity to the process of buying a home, particularly when affordability is a central concern for first-time buyers. Jessica Lautz, Deputy Chief Economist at NAR, acknowledges the current formidable market conditions, stating, "It’s an incredibly difficult market for all home buyers right now, especially first-time home buyers and especially first-time home buyers of color."
In response to these challenges, various down payment assistance programs target minority buyers, aiming to facilitate their journey toward homeownership:
The 3By30 program provides valuable resources specifically tailored for Black buyers, streamlining the process of securing a down payment and achieving homeownership.
For Native Americans, Down Payment Resource highlights 42 U.S. homebuyer assistance programs across 14 states, offering support with down payments and other associated costs to make homeownership more accessible.
Fannie Mae extends down payment assistance to eligible first-time homebuyers residing in Latino communities.
Even for those who may not qualify for these specific programs, numerous federal, state, and local options are available to explore. Engaging with a real estate professional becomes essential, as they can guide individuals towards the options that align best with their needs.
For minority homebuyers, persistent challenges may cause frustration, making it crucial to have a dedicated team of experts throughout the homebuying process. These professionals not only offer experienced advice and market insights but also serve as compassionate educators, advocating for the best interests of diverse homebuyers every step of the way.
Bottom Line
Ensure you connect with a real estate professional to guarantee you have the necessary information and support as you embark on the journey to homeownership.
2024-02-15T07:36:44-07:002024-02-22T03:32:45-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41901Why Pre-Approval Is Even More Important This Year<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240206/20240207-Why-Pre-Approval-Is-Even-More-Important-This-Year.png" title="On the road to becoming a homeowner? If so, you may have heard the term pre-approval get tossed around." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240206/20240207-Why-Pre-Approval-Is-Even-More-Important-This-Year.png" alt="Why Pre-Approval Is Even More Important This Year" /></a>
On the road to becoming a <a href="https://www.keepingcurrentmatters.com/2023/12/08/your-homebuying-adventure-infographic/" rel="noopener noreferrer" target="_blank">homeowner</a>? If so, you may have heard the <a href="https://www.keepingcurrentmatters.com/2024/01/19/key-terms-every-homebuyer-should-learn-infographic/" rel="noopener noreferrer" target="_blank">term</a> pre-approval get tossed around. Let’s break down what it is and why it’s important if you’re looking to <a href="https://www.keepingcurrentmatters.com/2024/01/03/thinking-about-buying-a-home-ask-yourself-these-questions/" rel="noopener noreferrer" target="_blank">buy a home</a> in 2024.
What Pre-Approval Is
As part of the <a href="https://www.keepingcurrentmatters.com/2024/01/10/avoid-these-common-mistakes-after-applying-for-a-mortgage/" rel="noopener noreferrer" target="_blank">homebuying process</a>, your lender will look at your finances to figure out what they’re willing to loan you. According to <a href="https://www.investopedia.com/financial-edge/0411/5-things-you-need-to-be-pre-approved-for-a-mortgage.aspx" rel="noopener noreferrer" target="_blank">Investopedia</a>, this includes things like your W-2, tax returns, <a href="https://www.keepingcurrentmatters.com/2023/12/26/get-ready-to-buy-a-home-by-improving-your-credit-score/" rel="noopener noreferrer" target="_blank">credit score</a>, bank statements, and more.
From there, they’ll give you a pre-approval letter to help you understand how much money you can borrow. Freddie Mac <a href="https://myhome.freddiemac.com/blog/homebuying/how-do-i-get-pre-approved-mortgage" rel="noopener noreferrer" target="_blank">explains</a> it like this:
“A pre-approval is an indication from your lender that they are willing to lend you a certain amount of money to buy your future home. . . . Keep in mind that the loan amount in the pre-approval letter is the lender’s maximum offer. Ultimately, you should only borrow an amount you are comfortable repaying.”
Now, that last piece is especially important. While <a href="https://www.keepingcurrentmatters.com/2024/01/18/3-key-factors-affecting-home-affordability/" rel="noopener noreferrer" target="_blank">home affordability</a> is getting better, it’s still tight. So, getting a good idea of what you can borrow can help you really wrap your head around the financial side of things. It doesn’t mean you should borrow the full amount. It just tells you what you can borrow from that lender.
This sets you up to make an informed decision about your numbers. That way you’re able to tailor your <a href="https://www.keepingcurrentmatters.com/2023/12/11/the-perfect-home-could-be-the-one-you-perfect-after-buying/" rel="noopener noreferrer" target="_blank">home search</a> to what you’re actually comfortable with budget-wise and can act fast when you find a home you love.
Why Pre-Approval Is So Important in 2024
If you want to buy a home this year, there’s another reason you’re going to want to be sure you’re working with a trusted lender to make this a priority.
While <a href="https://www.keepingcurrentmatters.com/2024/01/24/are-more-homeowners-selling-as-mortgage-rates-come-down/" rel="noopener noreferrer" target="_blank">more homes</a> are being listed for sale, the overall number of available homes is still below the norm. At the same time, the recent downward trend in <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">mortgage rates</a> compared to last year is bringing more buyers back into the market. That imbalance of more demand than supply creates a bit of a tug-of-war for you.
It means you’ll likely find you have more competition from other buyers as more and more people who were sitting on the sidelines when mortgage rates were higher decide to jump back in. But pre-approval can help with that too.
Pre-approval shows sellers you mean business because you’ve already undergone a credit and financial check. As Greg McBride, Chief Financial Analyst at Bankrate, <a href="https://www.bankrate.com/mortgages/preapproved-vs-prequalified/#preapproval" rel="noopener noreferrer" target="_blank">says</a>:
“Preapproval carries more weight because it means lenders have actually done more than a cursory review of your credit and your finances, but have instead reviewed your pay stubs, tax returns and bank statements. A preapproval means you’ve cleared the hurdles necessary to be approved for a mortgage up to a certain dollar amount.”
Sellers love that because that makes it more likely the sale will move forward without unexpected delays or issues. And if you may be competing with another buyer to land your dream home, why wouldn’t you do this to help stack the deck in your favor?
Bottom Line
If you’re looking to buy a home in 2024, know that getting pre-approved is going to be a key piece of the puzzle. With lower mortgage rates bringing more buyers back into the market, this can help you make a strong offer that stands out from the crowd.
2024-02-08T20:37:03-07:002024-02-26T01:00:55-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41899Why Having Your Own Agent Matters When Buying a New Construction Home<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240201/20240205-Why-Having-Your-Own-Agent-Matters-When-Buying-a-New-Construction-Home.png" title="Finding the right home is one of the biggest challenges for potential buyers today." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240201/20240205-Why-Having-Your-Own-Agent-Matters-When-Buying-a-New-Construction-Home.png" alt="Why Having Your Own Agent Matters When Buying a New Construction Home" /></a>
Finding the right home is one of the biggest <a href="https://www.keepingcurrentmatters.com/2023/09/29/explaining-todays-low-housing-supply-infographic/" rel="noopener noreferrer" target="_blank">challenges</a> for potential <a href="https://www.keepingcurrentmatters.com/2024/01/01/3-keys-to-hitting-your-homeownership-goals-in-2024/" rel="noopener noreferrer" target="_blank">buyers</a> today. Right now, the supply of homes for sale is still low. But there is a bright spot. <a href="https://www.keepingcurrentmatters.com/2024/01/16/why-you-may-want-to-seriously-consider-a-newly-built-home/" rel="noopener noreferrer" target="_blank">Newly built homes</a> make up a larger percent of the total homes available for sale than normal. That’s why, if you’re craving more options, it makes sense to see if a newly built home is right for you.
But it’s important to remember the process of working with a builder is different than buying from a homeowner. And, while builders typically have sales agents on-site, having your <a href="https://www.keepingcurrentmatters.com/2023/10/30/a-real-estate-agent-helps-take-the-fear-out-of-the-market/" rel="noopener noreferrer" target="_blank">own agent</a> helps make sure you have proper representation throughout your <a href="https://www.keepingcurrentmatters.com/2023/12/08/your-homebuying-adventure-infographic/" rel="noopener noreferrer" target="_blank">homebuying journey</a>. As Realtor.com <a href="https://www.realtor.com/guides/guide-to-buying-new-construction-home/steps-to-buying-a-new-construction-house/" rel="noopener noreferrer" target="_blank">says</a>:
“Keep in mind that the on-site agent you meet at a new-construction office works for the builder. So, as the homebuyer, it’s a smart idea to bring in your own agent, as well, to help you negotiate and stay protected in the transaction.”
Here’s how having your own agent is key when you build or <a href="https://www.keepingcurrentmatters.com/2024/01/05/achieving-your-homebuying-dreams-in-2024-infographic/" rel="noopener noreferrer" target="_blank">buy</a> a new construction home.
Agents Know the Local Area and Market
It’s important to consider how the neighborhood and surrounding area may evolve before making your home purchase. Your agent is well-versed in the upcoming communities and developments that could influence your decision. One way a real estate agent can help is by reviewing the builder’s site plan. For example, you’ll want to know if there are any plans to construct a highway or add a drainage ditch behind your prospective backyard.
Knowledge of Construction Quality and Builder Reputation
An agent also has expertise in the construction quality and reputation of different builders. They can give you insights into each one’s track record, customer satisfaction, and construction practices. Armed with this information, you can choose a builder known for consistently delivering top-notch homes.
Assistance with Customization and Upgrades
The most obvious benefit of opting for new home construction is the opportunity to customize your home. Your agent will guide you through that process and share advice on the upgrades that are most likely to add long-term value to your home. Their expertise helps make sure you focus your budget on areas that will give you the greatest return on your investment later.
Understanding Builder Negotiations and Contracts
When it comes to working with builders, having a skilled negotiator on your side can make all the difference. Builder contracts can be complex. Your agent can help you navigate these contracts to make sure you fully understand the terms and conditions. Plus, agents are skilled negotiators who can advocate for you, potentially securing better deals, upgrades, or incentives throughout the process. As Realtor.com <a href="https://www.realtor.com/guides/guide-to-buying-new-construction-home/steps-to-buying-a-new-construction-house/" rel="noopener noreferrer" target="_blank">says</a>:
“A good buyer’s agent will be able to review any contracts before you sign on the dotted line, ensuring you aren’t unwittingly agreeing to terms that only benefit the builder.”
Bottom Line
If you are interested in <a href="https://www.keepingcurrentmatters.com/2024/01/19/key-terms-every-homebuyer-should-learn-infographic/" rel="noopener noreferrer" target="_blank">buying</a> or building a new construction home, having a trusted agent by your side can make a big difference. If you'd like to start that conversation, connect with a local real estate agent.
2024-02-08T19:57:50-07:002024-02-08T20:13:31-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:417472 of the Factors That Impact Mortgage Rates<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240129/20240130-2-of-the-factors-that-impact-mortgage-rates.png" title="If you’re looking to buy a home, you’ve probably been paying close attention to mortgage rates." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240129/20240130-2-of-the-factors-that-impact-mortgage-rates.png" alt="2 of the Factors That Impact Mortgage Rates" /></a>
If you’re looking to <a href="https://www.keepingcurrentmatters.com/2024/01/18/3-key-factors-affecting-home-affordability/" rel="noopener noreferrer" target="_blank">buy a home</a>, you’ve probably been paying close attention to <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">mortgage rates</a>. Over the last couple of years, they hit record lows, rose dramatically, and are now dropping back down a bit. Ever wonder why?
The answer is complicated because there’s a lot that can influence mortgage rates. Here are just a few of the most impactful factors at play.
Inflation and the Federal Reserve
The Federal Reserve (Fed) doesn’t directly determine mortgage rates. But the Fed does move the Federal Funds Rate up or down in response to what’s happening with inflation, the economy, employment rates, and more. As that happens, mortgage rates tend to respond. Business Insider <a href="https://www.businessinsider.com/personal-finance/how-does-fed-impact-mortgage-rates" rel="noopener noreferrer" target="_blank">explains</a>:
“The Federal Reserve slows inflation by raising the federal funds rate, which can indirectly impact mortgages. High inflation and investor expectations of more Fed rate hikes can push mortgage rates up. If investors believe the Fed may cut rates and inflation is decelerating, mortgage rates will typically trend down.”
Over the last couple of years, the Fed raised the Federal Fund Rate to try to fight inflation and, as that happened, mortgage rates jumped up, too. Fortunately, the expert outlook for inflation and mortgage rates is that both should become more favorable over the course of the year. As Danielle Hale, Chief Economist at Realtor.com, <a href="https://www.forbes.com/advisor/mortgages/mortgage-interest-rates-forecast/" rel="noopener noreferrer" target="_blank">says</a>:
“[M]ortgage rates will continue to ease in 2024 as inflation improves . . .”
There’s even talk the Fed may actually cut the Fed Funds Rate this year because inflation is cooling, even though it’s not yet back to their ideal target.
The 10-Year Treasury Yield
Additionally, mortgage companies look at the 10-Year Treasury Yield to decide how much interest to charge on home loans. If the <a href="https://www.keepingcurrentmatters.com/2023/07/19/explaining-todays-mortgage-rates/" rel="noopener noreferrer" target="_blank">yield goes up</a>, mortgage rates usually go up, too. The opposite is also true. <a href="https://www.investopedia.com/mortgage/mortgage-rates/factors-affect-mortgage-rates/" rel="noopener noreferrer" target="_blank">According</a> to Investopedia:
“One frequently used government bond benchmark to which mortgage lenders often peg their interest rates is the 10-year Treasury bond yield.”
Historically, the spread between the 10-Year Treasury Yield and the 30-year fixed mortgage rate has been fairly consistent, but that’s not the case recently. That means, there’s room for mortgage rates to come down. So, keeping an eye on which way the treasury yield is trending can give experts an idea of where mortgage rates may head next.
Bottom Line
With the Fed meeting later this week, experts in the industry will be keeping a close watch to see what they decide and what impact it’ll have on the economy. To navigate any mortgage rate changes and their impact on your <a href="https://www.keepingcurrentmatters.com/2024/01/05/achieving-your-homebuying-dreams-in-2024-infographic/" rel="noopener noreferrer" target="_blank">moving plans</a>, it’s best to have a team of professionals on your side.
2024-01-31T01:34:25-07:002024-01-31T01:38:38-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41680Benefits of Investing in a Multi-Generational Home<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240124/20240125-The-Benefits-of-Buying-a-Multi-Generational-Home.png" title="Has the idea of sharing a home with loved ones like your grandparents, parents, or other relatives crossed your mind?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240124/20240125-The-Benefits-of-Buying-a-Multi-Generational-Home.png" alt="The Top Benefits of Buying a Multi-Generational Home" /></a>
Have you ever considered the prospect of cohabiting with your grandparents, parents, or other relatives? If the idea has crossed your mind, you're not alone. An increasing number of buyers are opting for this path by investing in multi-generational homes. Explore the compelling reasons behind this trend to determine if such a living arrangement might be suitable for you as well.
Why Buyers Are Opting for Multi-Generational Living
<a href="https://www.nar.realtor/blogs/economists-outlook/all-in-the-family-multi-generational-home-buying" rel="noopener noreferrer" target="_blank">According</a> to the National Association of Realtors (NAR), two of the top reasons buyers are opting for multi-generational homes today have to do with <a href="https://www.keepingcurrentmatters.com/2024/01/18/3-key-factors-affecting-home-affordability/" rel="noopener noreferrer" target="_blank">affordability</a> (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240124/20230125-Reasons-To-Purchase-A-MultiGeneration-Home.PNG" rel="noopener noreferrer" target="_blank"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240124/20230125-Reasons-To-Purchase-A-MultiGeneration-Home.PNG" /></a>
Cost savings are a top priority for 28% of first-time buyers, who find pooling resources with others advantageous. This collaborative approach allows sharing financial responsibilities such as mortgage payments and utilities, making homeownership more affordable. Particularly beneficial for first-time buyers navigating today's challenging market, this strategy helps overcome the hurdle of affording a home independently.
Additionally, both first-time (28%) and repeat buyers (18%) are increasingly turning to multi-generational homes to fulfill their homeownership dreams. Combining incomes through shared living arrangements allows for the purchase of a larger home with more space, making that dream home more attainable.
However, the appeal of multi-generational living extends beyond financial considerations. According to a study by the National Association of Realtors (NAR), 23% of repeat buyers choose multi-generational homes to facilitate the care of aging parents. For older adults, the desire to age in place is met with the support of loved ones, creating an environment that fosters a high quality of life. As Axios notes, "Financial concerns and caregiving needs are two of the major reasons people live with their parents (and parents’ parents)."
While the decision to embrace multi-generational living involves various factors, including financial and caregiving considerations, the process of finding the perfect home is complex. With multiple opinions and needs to consider, it's akin to solving a puzzle. Seeking guidance from a local real estate agent with expertise in multi-generational living can be invaluable.
Bottom Line
In conclusion, whether motivated by financial benefits or the desire for shared living, purchasing a multi-generational home may align with your goals. To explore this option further, consider partnering with a local real estate agent for tailored assistance.
2024-01-26T19:11:50-07:002024-01-29T09:09:17-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41640Are More Homeowners Selling as Mortgage Rates Come Down?<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240117/20240124-Are-more-homeowners-selling-as-mortgage-rates-come-down.jpg" title="If you’re looking to buy a home, the recent downward trend in mortgage rates is good news because it helps with affordability." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240117/20240124-Are-more-homeowners-selling-as-mortgage-rates-come-down.jpg" alt="Are More Homeowners Selling as Mortgage Rates Come Down?" /></a>
If you’re looking to <a href="https://www.keepingcurrentmatters.com/2024/01/05/achieving-your-homebuying-dreams-in-2024-infographic/" rel="noopener noreferrer" target="_blank">buy a home</a>, the recent downward trend in <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">mortgage rates</a> is good news because it helps with affordability. But there’s another way this benefits you – it may inspire more homeowners to put their houses up for sale.
The Mortgage Rate Lock-In Effect
Over the past year, one factor that’s really limited the options for your move is how few homes were on the market. That’s because many homeowners chose to delay their plans to sell once mortgage rates went up. An article from Freddie Mac <a href="https://www.freddiemac.com/research/forecast/20231220-us-economy-expanded-in-2023" rel="noopener noreferrer" target="_blank">explains</a>:
“The lack of housing supply was partly driven by the rate lock-in effect. . . . With higher rates, the incentive for existing homeowners to list their property and move to a new house has greatly diminished, leaving them rate locked.”
These homeowners decided to stay put and keep their current lower mortgage rate, rather than move and take on a higher one on their next home.
Early Signs Show Those Homeowners Are Ready To Move Again
According to the <a href="https://www.realtor.com/research/data/" rel="noopener noreferrer" target="_blank">latest data</a> from Realtor.com, there were more homeowners putting their houses up for sale, known in the industry as new listings, in December 2023 compared to December 2022 (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240117/20240124-Sellers-Are-Re-entering-the-market.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240117/20240124-Sellers-Are-Re-entering-the-market.png" /></a>
Here’s why this is so significant. Typically, activity in the <a href="https://www.keepingcurrentmatters.com/2024/01/03/thinking-about-buying-a-home-ask-yourself-these-questions/" rel="noopener noreferrer" target="_blank">housing market</a> cools down in the later months of the year as some sellers choose to delay their moves until January rolls around.
This is the first time since 2020 that we’re seen an uptick in new listings this time of year. This could be a signal that the rate lock-in effect is easing a bit in response to <a href="https://www.keepingcurrentmatters.com/2023/12/20/why-mortgage-rates-could-continue-to-decline/" rel="noopener noreferrer" target="_blank">lower rates</a>.
What This Means for You
While there isn’t going to suddenly be an influx of options for your <a href="https://www.keepingcurrentmatters.com/2023/11/21/are-there-actually-more-homes-for-sale-right-now/" rel="noopener noreferrer" target="_blank">home search</a>, it does mean more sellers may be deciding to list. According to a <a href="https://www.jchs.harvard.edu/blog/homeowner-mobility-stalls-amid-rising-interest-rates" rel="noopener noreferrer" target="_blank">recent article</a> from the Joint Center for Housing Studies (JCHS):
“A reduction in interest rates could alleviate the lock-in effect and help lift homeowner mobility. Indeed, interest rates have recently declined, falling by a full percentage point from October to November 2023 . . . Further decreases would reduce the barrier to moving and give homeowners looking to sell a newfound sense of urgency . . .”
And that means you may see more homes come onto the market to give you more <a href="https://www.keepingcurrentmatters.com/2023/12/11/the-perfect-home-could-be-the-one-you-perfect-after-buying/" rel="noopener noreferrer" target="_blank">fresh options</a> to choose from.
Bottom Line
As mortgage rates come down, more sellers may re-enter the market – that gives you an opportunity to find the home you’re looking for. Connect with a <a href="https://www.keepingcurrentmatters.com/2023/12/07/why-you-need-to-use-a-real-estate-agent-when-you-buy-a-home/" rel="noopener noreferrer" target="_blank">real estate agent</a> so you’ve got a local expert on your side who’ll help you stay on top of the latest listings in our area.
2024-01-24T23:03:18-07:002024-01-24T23:07:14-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41639Experts Project Home Prices Will Increase in 2024<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240122/20240123-Experts-Project-Home-Prices-Will-Increase-in-2024.png" title="Even though home prices are going up nationally, some people are still worried they might come down." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240122/20240123-Experts-Project-Home-Prices-Will-Increase-in-2024.png" alt="Experts Project Home Prices Will Increase in 2024" /></a>
Even though home prices are going up nationally, some people are still worried they might come down. In fact, a recent <a href="https://www.fanniemae.com/research-and-insights/surveys-indices/national-housing-survey/national-housing-survey-archive" rel="noopener noreferrer" target="_blank">survey</a> from Fannie Mae found that 24% of people think home prices will actually decline over the next 12 months. That means almost one out of every four people are dealing with that fear, and you might be, too.
To help ease that concern, here’s what experts forecast will happen with prices this year.
Experts Project a Modest Increase
Check out the latest <a href="https://www.keepingcurrentmatters.com/2024/01/12/home-prices-forecast-to-climb-over-the-next-5-years-infographic/" rel="noopener noreferrer" target="_blank">home price</a> forecasts from eight different sources (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240122/20240123-2024-Home-Price-Forecasts.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240122/20240123-2024-Home-Price-Forecasts.png" /></a>
The blue bar on the left means, on average, <a href="https://img03.en25.com/Web/MortgageBankersAssociation/%7Ba8f4bf3d-95ec-42be-9c8d-3eb49e52f553%7D_Mortgage_Finance_Forecast_Jan_2024.pdf" rel="noopener noreferrer" target="_blank">experts</a> think <a href="https://www.zillow.com/research/2024-housing-predictions-33447/" rel="noopener noreferrer" target="_blank">home prices</a> will go up over 2% by the end of this year – not down.
<a href="https://www.freddiemac.com/research/forecast/20231220-us-economy-expanded-in-2023" rel="noopener noreferrer" target="_blank">Prices</a> aren’t likely to depreciate in 2024 because <a href="https://www.keepingcurrentmatters.com/2024/01/16/why-you-may-want-to-seriously-consider-a-newly-built-home/" rel="noopener noreferrer" target="_blank">inventory</a> is still tight and lower <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">mortgage rates</a> are leading to strong <a href="https://www.keepingcurrentmatters.com/2024/01/17/2-reasons-why-todays-mortgage-rate-trend-is-good-for-sellers/" rel="noopener noreferrer" target="_blank">buyer demand</a>. Those two factors will keep pushing <a href="https://www.fanniemae.com/newsroom/fannie-mae-news/q4-2023-home-price-expectations-survey" rel="noopener noreferrer" target="_blank">prices</a> up as the year goes on. As Selma Hepp, Chief Economist at CoreLogic, <a href="https://www.cnn.com/2023/12/26/business/us-home-prices-record-high-october/index.html" rel="noopener noreferrer" target="_blank">explains</a>:
“With mortgage rates dropping, demand for homes in early 2024 is likely to be strong and will again put pressure on prices, similar to trends observed in early 2023 . . . Most markets will continue to reach new home price highs over the course of 2024.”
What Does This Mean for You?
Experts are saying <a href="https://twitter.com/NewsLambert/status/1730642488346472787" rel="noopener noreferrer" target="_blank">home prices</a> will go up this year, and that’s good news if you’re <a href="https://www.keepingcurrentmatters.com/2024/01/03/thinking-about-buying-a-home-ask-yourself-these-questions/" rel="noopener noreferrer" target="_blank">thinking</a> about <a href="https://www.keepingcurrentmatters.com/2024/01/16/why-you-may-want-to-seriously-consider-a-newly-built-home/" rel="noopener noreferrer" target="_blank">buying a home</a>. When you become a <a href="https://www.keepingcurrentmatters.com/2024/01/15/homeownership-is-still-at-the-heart-of-the-american-dream/" rel="noopener noreferrer" target="_blank">homeowner</a>, you want the <a href="https://cdn.nar.realtor/sites/default/files/documents/forecast-q4-2023-us-economic-outlook-10-26-2023.pdf" rel="noopener noreferrer" target="_blank">value</a> of your house to <a href="https://www.keepingcurrentmatters.com/2024/01/11/the-dramatic-impact-of-homeownership-on-net-worth/" rel="noopener noreferrer" target="_blank">go up</a>. That appreciation is what builds <a href="https://www.keepingcurrentmatters.com/2024/01/09/ways-your-home-equity-can-help-you-reach-your-goals/" rel="noopener noreferrer" target="_blank">equity</a> and makes homeownership such a good investment over time.
Beyond that, expected home price appreciation also means if you’re ready, willing, and able to <a href="https://www.keepingcurrentmatters.com/2024/01/05/achieving-your-homebuying-dreams-in-2024-infographic/" rel="noopener noreferrer" target="_blank">buy</a>, waiting just means it will cost more later.
Bottom Line
If you're worried home prices will come down, don’t be. Many experts believe they’ll actually go up this year. If you have questions or worries about what’s happening with prices in your area, it's a good idea to talk to a real estate agent.
2024-01-24T22:57:47-07:002024-01-24T23:03:04-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41561Three Crucial Factors Influencing Home Affordability<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240116/202401183-Key-Factors-Affecting-Home-Affordability.png" title="Over the past year, a lot of people have been talking about housing affordability and how tight it’s gotten." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240116/202401183-Key-Factors-Affecting-Home-Affordability.png" alt="3 Key Factors Affecting Home Affordability" /></a>
Over the past year, discussions about housing affordability have been prevalent, with recent relief seen in declining mortgage rates since October. However, understanding home affordability involves considering three crucial factors: mortgage rates, home prices, and wages. In this analysis, we explore the latest data on each aspect and examine how their trends contribute to an overall improvement in affordability for potential homebuyers.
Mortgage Rates: Mortgage rates have decreased in recent months, and experts anticipate further declines throughout the year, contingent on economic progress regarding inflation. Even slight changes in mortgage rates can significantly impact purchasing power, making homeownership more accessible by reducing monthly mortgage payments.
Home Prices: While home prices rose moderately in the previous year, they are expected to continue increasing in 2024 due to insufficient inventory for the demand. Although more inventory is projected, the rise in buyers entering the market is expected to balance it out. This suggests that while prices are likely to grow modestly, they won't skyrocket as seen during the pandemic. Potential buyers are advised to act promptly to avoid increased costs.
Wages: Rising incomes contribute positively to affordability. Current data from the Federal Reserve indicates that wages are growing at a rate higher than the typical trendline. This is advantageous for affordability, as higher wages reduce the percentage of income needed to cover monthly mortgage costs.
What This Means for You: Home affordability hinges on mortgage rates, home prices, and wages—all of which are currently moving in a positive direction for buyers. If you are considering purchasing a home, staying informed about these factors is crucial. Connecting with a trusted real estate agent can provide the latest updates and insights tailored to your specific situation.
Bottom Line
For prospective homebuyers, the main factors influencing affordability are showing improvement. Staying informed and acting strategically in the current market conditions can enhance your chances of making a sound and cost-effective home purchase.
2024-01-21T20:45:18-07:002024-01-22T07:41:12-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41501Why Choosing a Newly Built Home Could Be Wise
<img src="https://assets.site-static.com/userfiles/3675/image/NEWBH12.jpg" width="1200" height="628" />
Are you putting off your plans <a href="https://www.keepingcurrentmatters.com/2023/12/29/the-benefits-of-working-with-an-agent-when-you-sell-your-house-infographic/" rel="noopener noreferrer" target="_blank">to sell</a> because you’re worried you won’t be able to find a home you like when you move? If so, it may be time to consider a newly built home and the benefits that come with one. Here’s why.
Near-Record Percentage of New Home Inventory
Newly built homes are becoming an increasingly significant part of today’s housing inventory. According to the most recent report from the <a href="https://www.nahb.org/news-and-economics/press-releases/2023/12/new-home-sales-down-in-november-but-should-improve-moving-forward" rel="noopener noreferrer" target="_blank">National Association of Home Builders</a> (NAHB):
“Newly built homes available for sale accounted for 31% of total homes available for sale in November, compared to an approximate 12% historical average.”
That means the percentage of the total homes available to buy that are newly built is well over two times higher than the norm. And even more new homes are on the way.
<a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" rel="noopener noreferrer" target="_blank">Recent data</a> from the Census shows there’s been an uptick in both housing starts (where builders break ground on more new homes) and housing completions (homes where construction just wrapped).
And while some people may worry builders are building too many homes, that isn’t a concern – if anything, the recent increase is really good news. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), <a href="https://www.nar.realtor/magazine/real-estate-news/home-sales-start-to-rise-building-momentum-for-2024" rel="noopener noreferrer" target="_blank">explains</a>:
“Even more home building will be needed with the housing shortage persisting in most markets . . . Another 30% rise in home construction can easily be absorbed in the marketplace . . .”
How This Helps You
Since the supply of existing <a href="https://www.keepingcurrentmatters.com/2023/12/18/why-now-is-still-a-great-time-to-sell-your-house/" rel="noopener noreferrer" target="_blank">homes for sale</a> is still low right now, the increase of new-home construction can be a game changer because it gives you more options for your search.
Picture yourself in a home that’s new from the ground up: new appliances, fresh paint, fewer maintenance needs because everything is new, and so much more. Doesn’t that sound nice?
And it may be more within reach than you ever imagined. In addition, some builders are offering things like mortgage rate buy-downs for homebuyers right now. This can help offset today’s affordability challenges while also getting you into your dream home. In a recent article, Patrick Duffy, Senior Real Estate Economist at U.S. News, <a href="https://realestate.usnews.com/real-estate/articles/things-to-know-before-building-a-new-home" rel="noopener noreferrer" target="_blank">explains</a>:
“Builders have been using mortgage interest rate buydowns for many years as a sales incentive whenever interest rates are relatively high, . . .Today more builders are offering rate buydowns for the entirety of the loan, allowing buyers to finance more home for the same payment amount.”
Just remember, the process of buying from a builder is different from buying from a home seller, so it’s important to partner with a trusted <a href="https://www.keepingcurrentmatters.com/2023/12/21/sell-smarter-why-working-with-a-real-estate-agent-may-beat-going-solo/" rel="noopener noreferrer" target="_blank">real estate agent</a> who knows the local market. They’ll be your go-to resource for coordinating with the builder, reviewing contracts, and more.
Bottom Line
If you’re trying <a href="https://www.keepingcurrentmatters.com/2023/12/22/get-your-house-ready-to-sell-this-winter-infographic/" rel="noopener noreferrer" target="_blank">to sell</a> so you can make a move but you’re having a hard time finding a home you like, connect with a local real estate agent to explore all of your options, including the newly built homes in our area.2024-01-17T23:44:35-07:002024-01-22T08:08:23-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41462The American Dream Continues to Center Around Homeownership<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240112/Header-Image-pg-18.png" title="Buying a home is a powerful decision, and it remains at the heart of the American Dream." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240112/Header-Image-pg-18.png" alt="Homeownership Is Still at the Heart of the American Dream" /></a>
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240112/Header-Image-pg-18.png" title="Buying a home is a powerful decision, and it remains at the heart of the American Dream." class="lightbox-added"></a><br />
Making the decision to purchase a home is a profound choice, and it continues to symbolize the essence of the American Dream. Unlike renting, homeownership goes beyond providing shelter; it imparts a feeling of belonging, stability, and freedom. Senior Economist Nicole Bachaud from Zillow emphasizes, "The American Dream is still owning a home. There's a lot of pent-up demand for ownership; that isn't going to go away." Let's delve into a few compelling reasons why homeownership remains highly valued by many Americans.
The Financial Benefits of Owning a Home
One possible reason homeownership is viewed so highly is because owning a home is a significant <a href="https://www.keepingcurrentmatters.com/2023/11/07/homeowner-net-worth-has-skyrocketed/" rel="noopener noreferrer" target="_blank">wealth-building</a> tool. That may be why Jessica Lautz, Deputy Chief and VP of Research at the National Association of Realtors (NAR), <a href="https://www.cnbc.com/2023/12/15/heres-what-to-expect-in-2024-if-you-want-to-buy-a-home.html#:~:text=Indeed%2C%20%E2%80%9Chomeownership%20is%20the%20number,American%20dream%20of%20financial%20stability." rel="noopener noreferrer" target="_blank">says</a>:
“Homeownership is the number one way to build wealth in America.”
Over time, owning a home not only helps boost your own <a href="https://www.keepingcurrentmatters.com/2023/10/12/growing-your-net-worth-with-homeownership/" rel="noopener noreferrer" target="_blank">net worth</a>, but it also sets future generations up for success as you pass that wealth down. Habitat for Humanity <a href="https://www.habitat.org/sites/default/files/Evidence-Brief_Wealth-building-for-homeowners.pdf" rel="noopener noreferrer" target="_blank">explains</a>:
“Overall, homeownership promotes wealth building by acting as a forced savings mechanism and through home value appreciation. Homeowners make monthly payments that increase their equity in their homes by paying down the principal balance of their mortgage. . . . In addition, owning a home promotes intergenerational homeownership and wealth building. Children of homeowners transition to homeownership earlier — lengthening the period over which they can accumulate wealth . . .”
It can also provide meaningful <a href="https://www.keepingcurrentmatters.com/2023/10/25/invest-in-yourself-by-owning-a-home/" rel="noopener noreferrer" target="_blank">financial stability</a> compared to renting. When you buy with a fixed-rate mortgage, you can lock in your monthly housing payments for the length of your home loan.
The Non-Financial Benefits of Homeownership
But, owning a home offers more than just <a href="https://www.keepingcurrentmatters.com/2023/10/06/how-homeowner-net-worth-grows-with-time-infographic/" rel="noopener noreferrer" target="_blank">financial benefits</a>—it benefits you socially and <a href="https://www.keepingcurrentmatters.com/2023/11/23/why-homeowners-are-thankful-they-own/" rel="noopener noreferrer" target="_blank">emotionally</a> too. Your <a href="https://www.keepingcurrentmatters.com/2023/12/25/these-non-financial-benefits-turn-a-house-into-a-happy-home/" rel="noopener noreferrer" target="_blank">home</a> provides feelings of achievement, responsibility, and more. In a recent survey, Fannie Mae <a href="https://www.fanniemae.com/research-and-insights/perspectives/consumers-homeownership-aspirations-remain-high-despite-higher-home-prices-and-interest-rates" rel="noopener noreferrer" target="_blank">outlines</a> just a few of these more emotionally-driven benefits, including:
“The top three were having control over what you do with your living space (94%) to having a sense of privacy and security (91%) and having a good place for your family or to raise your children (90%) . . .”
What Does That Mean for You?
If your idea of the <a href="https://www.keepingcurrentmatters.com/2023/11/30/is-owning-a-home-still-the-american-dream-for-younger-buyers/" rel="noopener noreferrer" target="_blank">American Dream</a> involves greater freedom, security, and prosperity, homeownership could be a key player in bringing that dream to life. And with <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">mortgage rates</a> now on a downward trend, it might be a good time for you to consider making a move.
If you’re ready and able to buy, know that there are incredible benefits waiting at the end of your journey. You’ll gain more than just a home – it’s a place to grow your wealth and call your very own. Like Ksenia Potapov, Economist at First American <a href="https://blog.firstam.com/economics/building-wealth-brick-by-brick" rel="noopener noreferrer" target="_blank">says</a>:
“…homeownership remains an important driver of wealth accumulation and the largest source of total wealth among most households.”
Bottom Line
Purchasing a home is a significant decision and a fundamental element of the American Dream. If securing a place to call your own is a part of your aspirations this year, reach out to a local real estate advisor to initiate the process today.
2024-01-15T18:46:36-07:002024-01-19T05:22:37-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41393The Substantial Effect of Homeownership on Net Worth<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-The-Dramatic-Impact-of-Homeownership-on-Net-Worth.png" title="If you're trying to decide whether to rent or buy a home this year, here's a powerful insight that could give you the clarity and confidence you need to make your decision." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-The-Dramatic-Impact-of-Homeownership-on-Net-Worth.png" alt="The Dramatic Impact of Homeownership on Net Worth" /></a>
If you're grappling with the decision of renting versus buying a home this year, here's a compelling perspective that might provide the clarity and confidence essential for your choice. The Survey of Consumer Finances (SCF) from the Federal Reserve, released every three years, compares the net worth of homeowners and renters. The most recent report reveals that the average homeowner's net worth is nearly 40 times greater than that of a renter.
(see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-Homeowner-Net-Worth-Almost-40x-greater.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-Homeowner-Net-Worth-Almost-40x-greater.png" /></a>
One reason a wealth gap exists between renters and <a href="https://www.keepingcurrentmatters.com/2023/11/23/why-homeowners-are-thankful-they-own/" rel="noopener noreferrer" target="_blank">homeowners</a> is because when you’re a homeowner, your <a href="https://www.keepingcurrentmatters.com/2023/08/07/four-ways-you-can-use-your-home-equity/" rel="noopener noreferrer" target="_blank">equity</a> grows as your home appreciates in value and you make your mortgage payment each month. When you own a home, your monthly mortgage payment acts like a form of forced savings, which eventually pays off when you decide to sell. As a renter, you’ll never see a financial return on the money you pay out in rent every month. Ksenia Potapov, Economist at First American, <a href="https://blog.firstam.com/economics/building-wealth-brick-by-brick" rel="noopener noreferrer" target="_blank">explains</a> it like this:
“Renters don’t capture the wealth generated by house price appreciation, nor do they benefit from the equity gains generated by monthly mortgage payments . . .”
The Largest Part of Most Homeowner Net Worth Is Their Equity
Home <a href="https://www.keepingcurrentmatters.com/2023/08/15/equity-is-a-game-changer-for-homeowners-looking-to-sell/" rel="noopener noreferrer" target="_blank">equity</a> does more to build the average household’s wealth than anything else. According to data from <a href="https://blog.firstam.com/economics/building-wealth-brick-by-brick" rel="noopener noreferrer" target="_blank">First American</a> and the <a href="https://www.federalreserve.gov/econres/scfindex.htm" rel="noopener noreferrer" target="_blank">Federal Reserve</a>, this holds true across different income levels (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-housing-piece-of-net-worth-is-crucial.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240110/20240111-housing-piece-of-net-worth-is-crucial.png" /></a>
The green segment in each bar represents how much of a homeowner’s net worth comes from their home equity. Based on this data, it’s clear no matter what your income level is, owning a home can really boost your wealth. Nicole Bachaud, Senior Economist at Zillow, <a href="https://www.newsweek.com/housing-crisis-could-death-knell-americas-middle-class-1848936" rel="noopener noreferrer" target="_blank">shares</a>:
“The biggest asset most people are ever going to own is a home. Homeownership is really that financial key that helps unlock stability and wealth preservation across generations.”
If you’re ready to start building your net worth, the current real estate market offers several opportunities you should consider. For example, with <a href="https://www.keepingcurrentmatters.com/2023/12/20/why-mortgage-rates-could-continue-to-decline/" rel="noopener noreferrer" target="_blank">mortgage rates</a> trending lower lately, your <a href="https://www.keepingcurrentmatters.com/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/" rel="noopener noreferrer" target="_blank">purchasing power</a> may be higher now than it has been in months. And, with more <a href="https://www.keepingcurrentmatters.com/2023/12/13/the-surprising-trend-in-the-number-of-homes-coming-onto-the-market/" rel="noopener noreferrer" target="_blank">inventory</a> coming to the market, there are more options for you to consider. A local <a href="https://www.keepingcurrentmatters.com/2023/12/07/why-you-need-to-use-a-real-estate-agent-when-you-buy-a-home/" rel="noopener noreferrer" target="_blank">real estate agent</a> can walk you through the opportunities you have today and guide you through the process of finding your ideal home.
Bottom Line
If you're uncertain about the decision between renting and buying a home, consider that homeownership has the potential to enhance your long-term wealth, irrespective of your income. For further insights into this and numerous other advantages of owning a home, reach out to a local real estate agent.
2024-01-11T19:08:46-07:002024-01-15T07:44:30-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41391Steer Clear of These Typical Errors Post Mortgage Application<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240109/20240110-Avoid-These-Common-Mistakes-After-Applying-for-a-Mortgage.png" title="If you’re getting ready to buy a home, it’s exciting to jump a few steps ahead and think about moving in and making it your own." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240109/20240110-Avoid-These-Common-Mistakes-After-Applying-for-a-Mortgage.png" alt="Avoid These Common Mistakes After Applying for a Mortgage" /></a>
As you prepare to purchase a home, the excitement of envisioning your move-in and personalization is understandable. However, before delving too deeply into the emotional journey, it's crucial to consider certain key aspects after applying for your mortgage and before the closing process. Here's a checklist of important reminders as you navigate the home loan application process.
Don’t Deposit Large Sums of Cash
Lenders require a clear source for your funds, and cash transactions can be challenging to trace. Prior to depositing any cash into your accounts, consult with your loan officer to determine the appropriate method for documenting your transactions.
Don’t Make Any Large Purchases
ChatGPT
It's not limited to home-related expenses; any significant purchases may jeopardize your loan approval. Large expenditures can signal a risk to lenders, as individuals with new debts often exhibit higher debt-to-income ratios. Since elevated ratios pose potential risks for loans, borrowers might find themselves ineligible for their mortgage. Refrain from making substantial purchases, including furniture or appliances, to avoid any adverse impact on your loan qualification.
Don’t Cosign Loans for Anyone
When you cosign for a loan, you’re making yourself accountable for that loan’s success and repayment. With that obligation comes higher debt-to-income ratios as well. Even if you promise you won’t be the one making the payments, your lender will have to count them against you.
Don’t Switch Bank Accounts
Lenders need to source and track your assets. That task is much easier when there’s consistency among your accounts. Before you transfer any money, speak with your loan officer.
Don’t Apply for New Credit
Whether it's a recent credit card application or a new car purchase, the activity on your credit report across various financial sectors (mortgage, credit card, auto, etc.) can influence your FICO® score. Lower credit scores can impact your interest rate and potentially affect your eligibility for approval.
Don’t Close Any Accounts
Some buyers mistakenly think that reducing available credit makes them appear less risky and increases their chances of approval. However, this is not accurate. A significant factor in your credit score is the length and depth of your credit history, along with your total credit usage as a percentage of the available credit. Closing accounts can adversely affect both aspects of your credit score.
Do Discuss Changes with Your Lender
When communicating with your lender, openly share any changes that have happened or are anticipated. Any fluctuations in income, assets, or credit should be carefully examined and managed to secure the approval of your home loan. If there have been recent alterations in your job or employment status, it's essential to inform your lender. Overall, it is advisable to fully disclose and discuss your financial intentions with your loan officer before taking any financial actions.
Bottom Line
Ensuring a smooth home purchase process is crucial. Prior to making significant purchases, rearranging funds, or undergoing major life changes, it's essential to seek guidance from your lender—an expert qualified to clarify how your financial decisions might influence your home loan.
2024-01-11T18:57:50-07:002024-01-15T08:11:25-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41352The Implications of Reduced Mortgage Rates on Your Buying Capacity<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-What-Lower-Mortgage-Rates-Mean-for-Your-Purchasing-Power.png" title="If you want to buy a home, it's important to know how mortgage rates impact what you can afford and how much you’ll pay each month." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-What-Lower-Mortgage-Rates-Mean-for-Your-Purchasing-Power.png" alt="What Lower Mortgage Rates Mean for Your Purchasing Power" /></a>
Understanding the influence of mortgage rates on your homebuying capability and monthly payments is crucial. The good news is that 30-year fixed mortgage rates have notably decreased since the conclusion of October, currently resting at below 7%, as reported by Freddie Mac (refer to the graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-Mortgage-Rates-Fall-Below-Seven-Percent.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-Mortgage-Rates-Fall-Below-Seven-Percent.png" /></a>
Buyers can rejoice in the positive shift as recent Bankrate articles highlight that the cooling-off of mortgage rates is alleviating the housing affordability squeeze. Edward Seiler, AVP of Housing Economics and Executive Director of the Research Institute for Housing America at the Mortgage Bankers Association (MBA), further supports this optimism, stating, "MBA expects that affordability conditions will continue to improve as mortgage rates decline."
To provide additional context on how this trend can benefit your homebuying plans, let's delve into how mortgage rates impact your search for a home. Recognizing the correlation between mortgage rates and your monthly home payment is pivotal in achieving your homeownership goals. The chart below vividly illustrates how changes in mortgage rates influence your ability to afford a home. For instance, if your budget allows for a monthly payment between $2,400 and $2,500, the green segment in the chart represents payments within that range or lower (refer to the chart below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-Buyers-Purchasing-Power.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240104/20240108-Buyers-Purchasing-Power.png" /></a>
As you can see, even small changes in rates can affect your budget and the loan amount you can afford.
Get Help from Reliable Experts To Understand Your Budget and Plan Ahead
When embarking on the journey to purchase a home, seeking guidance from a local real estate agent and a reliable lender is crucial. Their expertise can assist you in exploring various mortgage options, comprehending the factors influencing fluctuations in mortgage rates, and understanding the direct implications on your homebuying journey.
By collaboratively examining the numbers and staying informed with the latest data, you can tailor your strategy based on the current rates, ensuring that you are well-prepared for the homebuying process.
Bottom Line
If you’re looking to <a href="https://www.keepingcurrentmatters.com/2023/11/24/why-homeowners-feel-thankful-for-their-homes-infographic/" rel="noopener noreferrer" target="_blank">buy a home</a>, you should know the recent downward trend in mortgage rates is good news for your move. Team up with a trusted <a href="https://www.keepingcurrentmatters.com/2023/12/07/why-you-need-to-use-a-real-estate-agent-when-you-buy-a-home/" rel="noopener noreferrer" target="_blank">real estate agent</a> and lender to plan your next steps.
2024-01-09T22:19:32-07:002024-01-22T08:23:01-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41271How Pre-Approval Can Transform Your Homebuying Experience<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231220/20240103-Why-Pre-Approval-Is-Your-Homebuying-Game-Changer.png" title="If you’re thinking about buying a home, pre-approval is a crucial part of the process you definitely don’t want to skip." class="lightbox-added"><img src="https://assets.site-static.com/userfiles/3675/image/Blog_Images/unnamed_16.png" width="750" height="410" /></a>
If the prospect of purchasing a home is on your mind, ensuring you go through the crucial step of pre-approval is non-negotiable. Before you dive into envisioning your life in a new home, whether it's lounging in the living room or enjoying meals on a potential all-season patio, it's imperative to collaborate with a reliable lender who emphasizes this essential process. Here's why: Despite a slowdown in home price growth and recent decreases in mortgage rates, affordability remains a challenge. Simultaneously, the current real estate market features a limited inventory of available homes, leading to ongoing competition among prospective buyers. However, by adopting a strategic approach, it's possible to navigate these challenges successfully – and pre-approval emerges as the pivotal factor in this game-changing process.
What Pre-Approval Does for You
To understand why it’s such an important step, you need to know more about pre-approval. As part of the homebuying process, a lender looks at your finances to determine what they’re willing to loan you. From there, your lender will give you a pre-approval letter to help you understand how much money you can borrow. Freddie Mac <a href="https://myhome.freddiemac.com/blog/homebuying/how-do-i-get-pre-approved-mortgage" rel="noopener noreferrer" target="_blank">explains</a> it like this:
“A pre-approval is an indication from your lender that they are willing to lend you a certain amount of money to buy your future home. . . . Keep in mind that the loan amount in the pre-approval letter is the lender’s maximum offer. Ultimately, you should only borrow an amount you are comfortable repaying.”
Getting pre-approved starts to put you in the mindset of seeing the bigger financial picture, one step at a time. And the key is actually more than just getting a pre-approval letter from your lender. The combination of pre-approval and strategic budgeting is your golden ticket to understanding what you can actually afford. It saves you from painful heartaches down the road so you don’t fall in love with a house that might be out of reach.
Pre-Approval Helps Show Sellers You’re a Serious Buyer
But that’s just the beginning. Let’s face it, there are more people looking to buy than there are homes available for <a href="https://www.keepingcurrentmatters.com/2023/12/11/the-perfect-home-could-be-the-one-you-perfect-after-buying/" rel="noopener noreferrer" target="_blank">sale</a>, and that creates competition among homebuyers. That means you could see yourself in a multiple-offer scenario when you get ready to make your move. But getting pre-approved for a mortgage can help you stand out from other buyers.
In today’s fast-moving housing market, having that pre-approval in your back pocket can be your secret weapon. When sellers see you’re pre-approved, it tells them you’re a strategic and serious buyer. In a world of multiple offers, that’s a big deal. As an article from the Wall Street Journal (WSJ) <a href="https://www.wsj.com/buyside/personal-finance/mortgage-pre-approval-25dd076c" rel="noopener noreferrer" target="_blank">says</a>:
“If you plan to use a mortgage for your home purchase, preapproval should be among the first steps in your search process. Not only can getting preapproved help you zero in on the right price range, but it can give you a leg up on other buyers, too.”
Pre-approval shows sellers you’re more than just a window shopper. You’re a buyer who’s already undergone a credit and financial check, making it more likely that the sale will move forward without unexpected delays or issues. Sellers love that because they see your offer as a reliable one. A win-win, right?
Bottom Line
Before you begin mentally organizing furniture in your ideal home, let's link up to secure your pre-approval. This step will not only save you time and stress but also prevent potential headaches that may arise without it. The truth is, the better prepared you are, the higher the likelihood of attaining the home you've been yearning for.
2024-01-04T22:54:45-07:002024-02-14T02:07:23-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41252Thinking About Buying a Home? Ask Yourself These Questions<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240102/20240103-Thinking-About-Buying-a-Home-Ask-Yourself-These-Questions.png" title="If you’re thinking of buying a home this year, you’re probably paying closer attention than normal to the housing market." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240102/20240103-Thinking-About-Buying-a-Home-Ask-Yourself-These-Questions.png" alt="Thinking About Buying a Home? Ask Yourself These Questions" /></a>
If you’re thinking of <a href="https://www.keepingcurrentmatters.com/2023/12/07/why-you-need-to-use-a-real-estate-agent-when-you-buy-a-home/" rel="noopener noreferrer" target="_blank">buying a home</a> this year, you’re probably paying closer attention than normal to the <a href="https://www.keepingcurrentmatters.com/2023/12/19/expert-quotes-on-the-2024-housing-market-forecast/" rel="noopener noreferrer" target="_blank">housing market</a>. And you’re getting your information from a variety of channels: the news, social media, your real estate agent, conversations with friends and loved ones, the list goes on and on. Most likely, <a href="https://www.keepingcurrentmatters.com/2023/11/22/home-prices-still-growing-just-at-a-more-normal-pace/" rel="noopener noreferrer" target="_blank">home prices</a> and mortgage rates are coming up a lot.
Here are the top two questions you need to ask yourself as you make your decision, including the data that helps cut through the noise.
1. Where Do I Think Home Prices Are Heading?
One reliable place you can turn to for information on home price forecasts is the <a href="https://www.fanniemae.com/newsroom/fannie-mae-news/q4-2023-home-price-expectations-survey" rel="noopener noreferrer" target="_blank">Home Price Expectations Survey</a> from Fannie Mae – a survey of over one hundred economists, real estate experts, and investment and market strategists.
According to the most recent release, the experts are projecting home prices will continue to rise at least through 2028 (see the graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240102/20240103-Estimated-Home-Price-Performance.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240102/20240103-Estimated-Home-Price-Performance.png" /></a>
So, why does this matter to you? While the percent of appreciation may not be as high as it was in recent years, what’s important to focus on is that this survey says we’ll see prices rise, not fall, for at least the next 5 years.
And home prices rising, even at a more moderate pace, is good news not just for the market, but for you too. It means, by buying now, your home will likely grow in value, and you should gain home equity in the years ahead. But, if you wait, based on these forecasts, the home will only cost you more later on.
2. Where Do I Think Mortgage Rates Are Heading?
Over the past year, mortgage rates spiked up in response to economic uncertainty, inflation, and more. But there’s an encouraging sign for the market and mortgage rates. Inflation is moderating, and here’s why this is such a big deal if you’re looking to <a href="https://www.keepingcurrentmatters.com/2023/12/12/down-payment-assistance-programs-can-help-pave-the-way-to-homeownership/" rel="noopener noreferrer" target="_blank">buy a home</a>.
When inflation cools, <a href="https://www.keepingcurrentmatters.com/2023/12/20/why-mortgage-rates-could-continue-to-decline/" rel="noopener noreferrer" target="_blank">mortgage rates</a> generally fall in response. That’s exactly what we’ve seen in recent weeks. And, now that the Federal Reserve has signaled they’re pausing their Federal Funds Rate increases and may even cut rates in 2024, experts are even more confident we’ll see mortgage rates come down.
Danielle Hale, Chief Economist at Realtor.com, <a href="https://www.realtor.com/research/federal-reserve-december-2023-meeting/" rel="noopener noreferrer" target="_blank">explains</a>:
“. . . mortgage rates will continue to ease in 2024 as inflation improves and Fed rate cuts get closer. . . . a key factor in starting to provide affordability relief to homebuyers.”
As an article from the National Association of Realtors (NAR) <a href="https://www.nar.realtor/magazine/real-estate-news/economists-turnaround-in-home-sales-likely-in-2024" rel="noopener noreferrer" target="_blank">says</a>:
“Mortgage rates likely have peaked and are now falling from their recent high of nearly 8%. . . . This likely will improve housing affordability and entice more home buyers to return to the market . . .”
No one can say with absolute certainty where mortgage rates will go from here. But the recent decline and the latest decision from the Federal Reserve to stop their rate increases, signals there’s hope on the horizon. While we may see some volatility here and there, <a href="https://www.keepingcurrentmatters.com/2023/10/26/affordable-homeownership-strategies-for-gen-z/" rel="noopener noreferrer" target="_blank">affordability</a> should improve as rates continue to ease.
Bottom Line
If you’re thinking about <a href="https://www.keepingcurrentmatters.com/2023/12/08/your-homebuying-adventure-infographic/" rel="noopener noreferrer" target="_blank">buying a home</a>, you need to know what’s expected with home prices and mortgage rates. While no one can say for certain where they’ll go, making sure you have the latest information can help you make an informed decision. Connect with a trusted local real estate agent so you can stay up to date on what’s happening and why this is such good news for you.
2024-01-03T20:31:24-07:002024-01-03T20:35:01-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41250Three Must-Have Strategies for Homeownership in 2024<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231220/20240101-3-Keys-To-Hitting-Your-Homeownership-Goals-in-2024.png" title="If buying or selling a home is your goal for 2024, it’s important to understand today’s housing market, know your why, and work with industry experts to bring your homeownership vision for the new year into focus." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231220/20240101-3-Keys-To-Hitting-Your-Homeownership-Goals-in-2024.png" alt="3 Keys To Hitting Your Homeownership Goals in 2024" /></a>
Achieving your homeownership goals in 2024 requires a keen understanding of today's housing market, a clear sense of purpose, and collaboration with industry experts. Economic shifts over the past year have significantly influenced the housing market, emphasizing the importance of aligning your goals with market realities.
Danielle Hale, Chief Economist at Realtor.com, emphasizes the need for focus in the current housing landscape: "The key to making a good decision in this challenging housing market is to be laser focused on what you need now and in the years ahead, so that you can stay in your home long enough that buying is a sound financial decision."
Consider these key steps as you outline your homeownership goals for the upcoming year:
Know Your Why: Identify the reason behind your desire to move. Whether it's addressing changing needs or stepping into homeownership for the first time, your motivation serves as a guidepost. Work with an expert advisor to ensure your move aligns with your goals.
Define Your Dream Home: Clearly articulate what your ideal home looks like. While the inventory of homes for sale has increased, collaboration with a professional is crucial to navigating the market. Balancing your budget and preferences will help you find a home that suits your needs.
Assess Your Readiness to Buy: Understand your budget and available savings before delving into the homebuying process. Early engagement with a local agent and a lender will position you well for a successful purchase. This includes planning for a down payment, securing pre-approval for a home loan, and evaluating your current home equity if you're selling.
Navigating the complexities of buying or selling a home requires expertise. Don't let uncertainty hinder your goals in 2024—trust a professional to provide the guidance and information you need about the current housing market.
Bottom Line
In summary, collaborate with a local real estate agent and assemble a team of industry professionals to ensure you achieve your homeownership goals in 2024.
2024-01-03T19:03:06-07:002024-01-12T10:37:12-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41196Essential Insights on Saving for Your Home in 2024<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231220/20231228-What-You-Need-To-Know-About-Saving-for-a-Home-in-2024.png" title="If you’re planning to buy a home, knowing what to budget for and how to save may sound intimidating – but it doesn’t have to be." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231220/20231228-What-You-Need-To-Know-About-Saving-for-a-Home-in-2024.png" alt="What You Need To Know About Saving for a Home in 2024" /></a>
If you're gearing up to purchase a home, understanding the financial aspects involved can be a significant step towards a smooth process. Trusted real estate professionals can provide valuable guidance on budgeting and planning. Here are key considerations:
1. Down Payment
Saving for your <a href="https://www.keepingcurrentmatters.com/2023/12/15/what-you-need-to-know-about-down-payments-infographic/" rel="noopener noreferrer" target="_blank">down payment</a> is likely top of mind as you set out to buy a home. But do you know how much you’ll need? While every buyer’s situation is different, there’s a common misconception that putting 20% of the purchase price down is required. An article from the Mortgage Reports <a href="https://themortgagereports.com/18520/20-percent-downpayment-risk-mortgage-interest-rate" rel="noopener noreferrer" target="_blank">explains</a> why that’s not always the case:
“The idea that you have to put 20% down on a house is a myth. . . . The right amount depends on your current savings and your home buying goals.”
To understand your options, partner with trusted real estate professionals to go over the various loan types, down payment <a href="https://www.keepingcurrentmatters.com/2023/12/12/down-payment-assistance-programs-can-help-pave-the-way-to-homeownership/" rel="noopener noreferrer" target="_blank">assistance programs</a>, and what each one requires. The more you know ahead of time, the easier the process will be.
2. Closing Costs
Make sure you also budget for closing costs, which are a collection of fees and payments made to the various parties involved in your transaction. Bankrate <a href="https://www.bankrate.com/mortgages/what-are-closing-costs/" rel="noopener noreferrer" target="_blank">explains</a>:
“Closing costs are the fees you pay when finalizing a real estate transaction, whether you’re refinancing a mortgage or buying a new home. These costs can amount to 2 to 5 percent of the mortgage so it’s important to be financially prepared for this expense.”
The best way to understand what you’ll need at the closing table is to work with a trusted lender. They can provide you with answers to the questions you might have.
3. Earnest Money Deposit
If you want to cover all your bases, you can also consider saving for an earnest money deposit (EMD). An EMD is money you pay as a show of good faith when you make an offer on a house. According to <a href="https://www.realtor.com/advice/finance/understanding-the-earnest-money-deposit-2/" rel="noopener noreferrer" target="_blank">Realtor.com</a>, it’s usually between 1% and 2% of the total home price.
This deposit works like a credit. It’s not an added expense – it’s paying a portion of your costs upfront. You’re using some of the money you’ve already saved for your purchase to show the seller you’re committed and serious about buying their house. Realtor.com <a href="https://www.realtor.com/advice/finance/understanding-the-earnest-money-deposit-2/" rel="noopener noreferrer" target="_blank">describes</a> how it works as part of your sale:
“It tells the real estate seller you’re in earnest as a buyer . . . Assuming that all goes well and the buyer’s good-faith offer is accepted by the seller, the earnest money funds go toward the down payment and closing costs. In effect, earnest money is just paying more of the down payment and closing costs upfront.”
Keep in mind, an EMD isn’t required, and it doesn’t guarantee your offer will be accepted. It’s important to work with a real estate advisor to understand what’s best for your situation and any specific requirements in your local area. They’ll advise you on what moves you should make so you can make the best possible decisions throughout the buying process.
Bottom Line
Navigating these considerations with a local real estate advisor ensures you make well-informed decisions throughout the homebuying journey. They can provide expert insights and address any queries that arise, offering a smoother and more confident experience.
2023-12-30T04:13:24-07:002024-01-02T08:39:22-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41094 Prepare for Homeownership by Enhancing Your Credit Score<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231219/20231226-Get-Ready-To-Buy-a-Home-by-Improving-Your-Credit-Score.png" title="As the new year approaches, the idea of buying a home might be on your mind." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231219/20231226-Get-Ready-To-Buy-a-Home-by-Improving-Your-Credit-Score.png" alt="Get Ready To Buy a Home by Improving Your Credit Score" /></a>
As the new year approaches, the prospect of purchasing a home might be on your mind. It’s an exciting goal to set, and it’s never too early to start laying the groundwork. One crucial step in preparing for homeownership is building a solid credit score.
Lenders evaluate your credit to assess your ability to make timely payments, repay debts, and more. It's also a factor that influences your mortgage rate. An article from CNBC explains:
“When it comes to mortgages, a higher credit score can save you thousands of dollars in the long run. This is because your credit score directly impacts your mortgage rate, which determines the amount of interest you’ll pay over the life of the loan.”
This emphasizes the importance of your credit score in your current homebuying plans, particularly as mortgage rates play a key role in affordability today.
According to the Federal Reserve Bank of New York, the median credit score in the U.S. for those taking out a mortgage is 770. However, your credit score doesn’t have to be perfect. An article from Business Insider generally explains how your FICO score range can make an impact:
“. . . you don’t need a perfect credit score to buy a house. . . . Aiming to get your credit score in the ‘Good’ range (670 to 739) would be a great start towards qualifying for a mortgage. But if you’re wanting to qualify for the lowest rates, try to get your score within the ‘Very Good’ range (740 to 799).”
Working with a trusted lender is the best way to get more information on how your credit score could factor into your home loan and the mortgage rate. As FICO says:
“While many lenders use credit scores like FICO Scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable. There is no single “cutoff score” used by all lenders and there are many additional factors that lenders may use to determine your actual interest rates.”
If you’re looking for ways to improve your score, Experian highlights some things you may want to focus on:
Your Payment History: Late payments can have a negative impact by dropping your score. Focus on making payments on time and paying any existing late charges quickly. Your Debt Amount (relative to your credit limits): When it comes to your available credit amount, the less you’re using, the better. Focus on keeping this number as low as possible. Credit Applications: If you’re looking to buy something, don’t apply for additional credit. When you apply for new credit, it could result in a hard inquiry on your credit that drops your score. A lender will help you navigate the process from start to finish, from assessing which range your score falls in to telling you more about the specifics for each loan type.
Bottom Line
As you gear up to purchase a home in the coming year, enhancing your credit score can significantly impact your ability to secure a favorable mortgage rate. To delve deeper into this aspect, consider reaching out to a reliable lender for valuable insights and guidance.
2023-12-27T20:05:52-07:002023-12-29T14:29:57-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:41093Transforming a House into a Happy Home: Discover the Non-Financial Perks<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231219/20231225-Turning-a-House-Into-a-Happy-Home.png" title="There’s no denying the long-term financial benefits of owning a home, but today’s housing market may have you wondering if now’s still the time to buy." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231219/20231225-Turning-a-House-Into-a-Happy-Home.png" alt="These Non-Financial Benefits Turn a House into a Happy Home" /></a>
While the enduring financial advantages of homeownership are undeniable, the current state of the housing market may prompt you to question if now is the opportune time to buy. Beyond the crucial financial aspects, it's essential to consider the non-financial and emotional reasons. The concept of home holds diverse meanings for everyone, encompassing the sharing of cherished memories around the kitchen table or finding solace while reading a book in a favorite chair. These emotional connections to our homes carry significance parallel to their financial aspects. Explore some aspects that transform a house into a place of joy and fulfillment.
1. You Can Be Proud of Your Accomplishment
<a href="https://www.keepingcurrentmatters.com/2023/12/08/your-homebuying-adventure-infographic/" rel="noopener noreferrer" target="_blank">Buying a home</a> is a major life milestone. Whether you’re ready to buy your first home or your fifth, congratulations will be in order once you’ve achieved your goal. The sense of accomplishment you’ll feel at the end of your journey will truly make your home feel like your special place. Go ahead and smile – you’ve earned it.
2. You Have Your Own Designated Happy Place
<a href="https://www.keepingcurrentmatters.com/2023/11/30/is-owning-a-home-still-the-american-dream-for-younger-buyers/" rel="noopener noreferrer" target="_blank">Owning your home</a> offers not only safety and security, but also a comfortable place where you can relax and unwind after a long day. Sometimes that’s just what you need to feel refreshed and recharged.
3. You Can Find the Space To Meet Your Needs
Whether you want more room for your changing lifestyle (like a large backyard for entertaining or room for a home office) or you simply want to move closer to your loved ones, you can invest in a <a href="https://www.keepingcurrentmatters.com/2023/11/24/why-homeowners-feel-thankful-for-their-homes-infographic/" rel="noopener noreferrer" target="_blank">home</a> that truly works for your evolving needs.
4. You Can Customize Your Surroundings
Looking to try one of those decorative wall treatments you saw online? Tired of paying an additional pet deposit for your apartment building? Or maybe you want to create an in-house yoga studio. You can do these things and much more when you <a href="https://www.keepingcurrentmatters.com/2023/11/23/why-homeowners-are-thankful-they-own/" rel="noopener noreferrer" target="_blank">own your home</a>.
Bottom Line
Whether you're preparing to purchase your inaugural home or considering a move to better align with your evolving needs, reflect on the emotional advantages that can truly make a house a happy home. When the time comes for your next move, reach out to a local real estate advisor for expert assistance.
2023-12-27T19:55:12-07:002023-12-29T14:18:35-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40899What You Need To Know About Down Payments [INFOGRAPHIC]<img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/assets/image/20231214/What-You-Need-To-Know-About-Down-Payments-NM.jpg" />
Some Highlights
If you want to <a href="https://www.keepingcurrentmatters.com/2023/12/06/how-to-turn-homeownership-into-a-side-hustle/" rel="noopener noreferrer" target="_blank">buy a home</a>, you may not need as much for your <a href="https://www.keepingcurrentmatters.com/2023/12/12/down-payment-assistance-programs-can-help-pave-the-way-to-homeownership/" rel="noopener noreferrer" target="_blank">down payment</a> as you think.
There are various loan options for qualified buyers with down payments as low as 3.5% or even no down payment requirement. There are also thousands of programs available to help <a href="https://www.keepingcurrentmatters.com/2023/12/11/the-perfect-home-could-be-the-one-you-perfect-after-buying/" rel="noopener noreferrer" target="_blank">homebuyers</a> with their down payments.
With the right resources, your down payment may be more within reach than you realize. Talk to a local <a href="https://www.keepingcurrentmatters.com/2023/12/07/why-you-need-to-use-a-real-estate-agent-when-you-buy-a-home/" rel="noopener noreferrer" target="_blank">real estate expert</a> to learn more about your options.
2023-12-16T03:45:16-07:002023-12-18T13:48:30-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40836Paving the Way to Homeownership with Down Payment Assistance Programs<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231207/20231212-Down-Payment-Assistance-Programs-Can-Help-Pave-the-Way-to-Homeownership.png" title="If you’re looking to buy a home, your down payment doesn’t have to be a big hurdle." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231207/20231212-Down-Payment-Assistance-Programs-Can-Help-Pave-the-Way-to-Homeownership.png" alt="Down Payment Assistance Programs Can Help Pave the Way to Homeownership" /></a>
When considering a home purchase, overcoming the hurdle of a substantial down payment is more achievable than you might think. The National Association of Realtors (NAR) reveals that 38% of first-time homebuyers identify saving for a down payment as the most challenging step. However, the reality is that you likely don't need to put down as much as you initially thought:
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231207/20231212-Todays-Median-Down-Payment-Is-Much-Lower.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231207/20231212-Todays-Median-Down-Payment-Is-Much-Lower.png" /></a>
NAR data indicates that the median down payment has not exceeded 20% since 2005. Currently, the median down payment for all homebuyers is just 15%, and for first-time homebuyers, it's even lower at 8%. However, this median figure doesn't imply a requirement to put down that specific amount; some qualified buyers opt for even lower down payments.
For instance, certain loan types, such as FHA loans, allow down payments as low as 3.5%. Additionally, options like VA loans and USDA loans have no down payment requirements for eligible applicants. Yet, let's delve into another valuable resource that could assist with your down payment: down payment assistance programs.
First-Time and Repeat Buyers Are Often Eligible
Down Payment Resource reports the existence of thousands of programs for homebuyers, with 75% of these being down payment assistance programs.
Importantly, eligibility is not restricted to first-time homebuyers. Regardless of your position in the homebuying journey, there could be a viable option for you. Down Payment Resource emphasizes:
"You don’t have to be a first-time buyer. Over 39% of all [homeownership] programs are for repeat homebuyers who have owned a home in the last 3 years."
To explore these possibilities further, the ideal starting point is consulting with a trusted real estate professional. They can provide comprehensive information, including details about additional programs tailored to specific professions or communities.
Additional Down Payment Resources That Can Help
Here are a few down payment assistance programs that are helping many of today’s buyers achieve the dream of homeownership:
Teacher Next Door is designed to help teachers, first responders, health providers, government employees, active-duty military personnel, and veterans reach their down payment goals.
<a href="https://www.fanniemae.com/casa" rel="noopener noreferrer" target="_blank">Fannie Mae</a> provides down-payment assistance to eligible first-time homebuyers living in majority-Latino communities.
<a href="https://myhome.freddiemac.com/buying/down-payments-and-pmi" rel="noopener noreferrer" target="_blank">Freddie Mac</a> also has options designed specifically for homebuyers with modest credit scores and limited funds for a down payment.
The <a href="https://3by30.org/homeownership-101/get-help-buying-a-home/" rel="noopener noreferrer" target="_blank">3By30</a> program lays out actionable strategies to add 3 million new Black homeowners by 2030. These programs offer valuable resources for potential buyers, making it easier for them to secure down payments and realize their dream of homeownership.
For Native Americans, <a href="https://downpaymentresource.com/homebuyer-resource/highlighting-42-native-american-homebuyer-assistance-programs-in-honor-of-native-american-heritage-month/" rel="noopener noreferrer" target="_blank">Down Payment Resource</a> highlights 42 U.S. homebuyer assistance programs across 14 states that ease the path to homeownership by providing support with down payments and other associated costs.
Even if you don’t qualify for these types of programs, there are many other federal, state, and local options available to look into. And a real estate professional can help you find the ones that meet your needs as you explore what’s available.
Bottom Line
Turning the dream of homeownership into reality might be more attainable than you realize, especially when you are aware of the right support channels. For more information, reach out to a real estate professional who can navigate you through the available resources.
2023-12-12T20:54:33-07:002023-12-14T10:39:07-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40835Perfecting Your Home: Unveiling Potential After Purchase<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231211-The-Perfect-Home-Could-Be-the-One-You-Perfect-After-Buying.png" title="There’s no denying mortgage rates and home prices are higher now than they were last year and that’s impacting what you can afford." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231211-The-Perfect-Home-Could-Be-the-One-You-Perfect-After-Buying.png" alt="The Perfect Home Could Be the One You Perfect After Buying" /></a>
There's no denying that current mortgage rates and home prices surpass those of the previous year, impacting affordability. Simultaneously, the housing market experiences a shortage of available homes, presenting significant challenges for buyers. Despite these hurdles, there are effective strategies to overcome them and turn your homeownership dream into a reality.
Approaching a purchase this season requires strategic planning. It involves a careful examination of your wish list, distinguishing between essential features for your next home and those that are merely desirable. This approach prevents overextending your budget or narrowing down your options excessively in pursuit of the perfect home.
Danielle Hale, Chief Economist at Realtor.com, <a href="https://twitter.com/RDC_Economics/status/1590722818639269889" rel="noopener noreferrer" target="_blank">explains</a>:
“The key to making a good decision in this challenging housing market is to be laser focused on what you need now and in the years ahead, . . . Another key point is to avoid stretching your budget, as tempting as it may be . . .”
To help identify what you truly need, make a list of all the features you’ll want to see. From there, work to break those features into categories. Here’s a great way to organize your list:
Must-Haves – If a house doesn’t have these features, it won’t work for you and your lifestyle (examples: distance from work or loved ones, number of bedrooms/bathrooms, etc.).
Nice-To-Haves – These are features you’d love to have but can live without. Nice-to-haves aren’t dealbreakers, but if you find a home that hits all the must-haves and some of these, it’s a contender (examples: a second home office, a garage, etc.).
Dream State – This is where you can really think big. Again, these aren’t features you’ll need, but if you find a home in your budget that has all the must-haves, most of the nice-to-haves, and any of these, it’s a clear winner (examples: a pool, multiple walk-in closets, etc.).
If you limit your home tours to properties that possess all your dream features, you might be unnecessarily narrowing down your options and creating additional challenges for yourself, including those related to your budget.
Although the allure of granite countertops or a backyard pool is undeniable, consider that these features can often be added post-purchase. It might be more prudent to prioritize aspects that are unchangeable, such as location or a specific number of rooms. Subsequently, you can plan for upgrades or the addition of desired features at a later time.
Sometimes the perfect home is the one you perfect after buying it.
After organizing your list according to your preferences, engage in a conversation with your real estate agent about your top priorities. They possess the expertise to assist you in fine-tuning the list, providing guidance on adhering to it effectively, and locating a home in your area that aligns with your most critical needs.
Bottom Line
Amidst the existing affordability challenges and constrained housing supply, it's crucial to approach the home search strategically. Ensure you find a home that caters to your needs without stretching your budget. Collaborate with a real estate agent to navigate these challenges and make your homeownership goals a reality.
2023-12-12T20:49:53-07:002023-12-13T15:02:00-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40781The Essential Role of a Real Estate Agent in Your Home Buying Journey<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231207-Why-You-Need-To-Use-a-Real-Estate-Agent-When-You-Buy-a-Home.png" title="If you’ve recently decided you’re ready to become a homeowner, chances are you’re trying to figure out what to do first." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231207-Why-You-Need-To-Use-a-Real-Estate-Agent-When-You-Buy-a-Home.png" alt="Why You Should Use a Real Estate Agent When You Buy a Home" /></a>
If you've recently made the decision to embark on the journey of homeownership, you might find yourself pondering the initial steps. The prospect of where to begin can be daunting, but the reassuring news is that you don't have to navigate this process on your own.
The process of purchasing a home involves numerous intricacies, and this holds particularly true in today's dynamic housing market. With a scarcity of homes for sale and elevated home prices and mortgage rates, navigating this landscape can be challenging without reliable expertise and a trusted advisor by your side. That's why initiating the journey by connecting with a local real estate agent is considered the most beneficial starting point.
Agents Are the #1 Most Useful Source in the Buying Process
The latest <a href="https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers" rel="noopener noreferrer" target="_blank">annual report</a> from the National Association of Realtors (NAR) finds recent homebuyers agree the #1 most useful source of information they had in the home buying process was a real estate agent. Let’s break down why.
How an Agent Helps When You Buy a Home
When contemplating a real estate agent, the typical image may involve someone guiding you through home showings and managing paperwork. However, an exceptional agent goes beyond these expectations. They don't merely act as facilitators for your purchase; instead, they serve as your guiding companion throughout every stage of the process.
The visual below shows some examples from that same <a href="https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers" rel="noopener noreferrer" target="_blank">NAR release</a> of the many ways an agent adds value. It includes the percentage of homebuyers in that report who highlighted each of these benefits:
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231207-Benefits-Provided-by-Real-Estate-Agent-During-Home-Purchase-Process.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231207-Benefits-Provided-by-Real-Estate-Agent-During-Home-Purchase-Process.png" /></a>
Here’s a bit more context on how the survey results noted an agent continually helps buyers in these situations:
Helped Buyer’s Understand the Process: Do you know the difference between an inspection and an appraisal, what each report tells you, and why they’re both important? Or that there are things you shouldn’t do after applying for a mortgage, like buying appliances or furniture? An agent knows all of these best practices and will share them with you along the way, so you don’t miss any key steps by the time you get to the closing table.
Pointed Out Unnoticed Features or Faults with the Home: An agent also has a lot of experience evaluating homes. They’ve truly seen it all. They’ll be able to pinpoint some things you may not have noticed about the home that could help inform your decision or at least what repairs you ask for.
Provided a Better List of Service Providers: In a real estate transaction, there are a lot of people involved. An agent has experience working with various professionals in your area, like home inspectors, and can help connect you with the pros you need for a successful experience.
Negotiated Better Contract Terms and Price: Did something pop up in the home inspection or with the appraisal? An agent will help you re-negotiate as needed to get the best terms and price possible for you, so you feel confident with your big purchase.
Improved Buyer’s Knowledge of the Search Area: Moving to a new town and you’re not familiar with the area, or you’re staying nearby, but don’t know which neighborhoods are most affordable? Either way, an agent knows the local area like the back of their hand and can help you find the perfect location for your needs.
Expanded Buyer’s Search Area: And if you’re not finding anything you’re interested in within your initial search radius, an agent will know other neighborhoods nearby you should consider based on what you like, what amenities you want, and more.
Bottom Line
If you're in the market for a home purchase, it's crucial not to overlook the indispensable role of an agent in this process. Whether facing obstacles, navigating negotiations, or encountering any challenges, your agent possesses the expertise to handle it all, ensuring a smoother experience and minimizing your stress. Connect with a local real estate agent to navigate this journey collaboratively.
2023-12-08T18:27:26-07:002023-12-13T08:09:45-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40780Creating a Side Hustle from Homeownership<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-How-to-Turn-Homeownership-into-a-Side-Hustle.png" title="Does the rising cost of just about everything these days make your dream of owning your own home feel less within reach?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-How-to-Turn-Homeownership-into-a-Side-Hustle.png" alt="How To Turn Homeownership into a Side Hustle" /></a>
Is the escalating cost of almost everything today making the prospect of owning your home seem more distant? According to Bankrate, numerous individuals are exploring supplementary income avenues, possibly to manage rising expenses and save for a home. This trend is especially prevalent among younger individuals contending with student loan debt. (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-Nearly-two-in-five-US-adults-have-a-side-hustle.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-Nearly-two-in-five-US-adults-have-a-side-hustle.png" /></a>
Here are two strategies that can not only make <a href="https://www.keepingcurrentmatters.com/2023/11/23/why-homeowners-are-thankful-they-own/" rel="noopener noreferrer" target="_blank">homeownership</a> more affordable in the short term, but turn it into a lucrative side hustle that can pay off down the road.
Transforming the Challenge of a Fixer-Upper into an Opportunity
One strategy to facilitate your entry into homeownership is to explore the option of purchasing a fixer-upper – a home that might be somewhat less visually appealing and consequently has been on the market for an extended period. According to a recent U.S. News article:
"The current state of the housing market may lead you to broaden your search for a home that fits your budget. A fixer-upper, in need of some updating and tender care, can be a favorable alternative to ready-to-move-in houses that quickly disappear from the market."
Opting for a property that requires some renovation could offer two significant advantages. Firstly, it may simplify your search for a home as you won't be fixated on finding the perfect option. Additionally, it could enable you to enter the housing market at a more affordable price point. This approach provides a cost-effective route to homeownership while presenting the potential for future financial gains.
Although the home may demand a bit of effort, investing time and energy into gradually enhancing your property not only transforms it into a cozy abode but also elevates its future market value. As you take pleasure in the process of turning a house into a home, you're concurrently building equity that can be realized when the time comes to sell.
Renting Out a Portion of Your Home To Make It More Affordable
Another savvy strategy is to <a href="https://www.keepingcurrentmatters.com/2023/11/03/the-benefits-of-buying-a-multi-generational-home-infographic/" rel="noopener noreferrer" target="_blank">purchase a home</a> with the upfront intention of renting out a portion of it. <a href="https://zillow.mediaroom.com/2023-11-16-Interest-in-house-hacking-explodes-among-Millennial-and-Gen-Z-home-buyers-seeking-extra-income" rel="noopener noreferrer" target="_blank">According</a> to a recent press release from Zillow, renting out a part of their home is already very important for most young homebuyers (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-Percent-of-buyers-who-find-it-very-or-extremely-important.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231204/20231206-Percent-of-buyers-who-find-it-very-or-extremely-important.png" /></a>
This approach serves a strong purpose. As Manny Garcia, Senior Population Scientist at Zillow, <a href="https://zillow.mediaroom.com/2023-11-16-Interest-in-house-hacking-explodes-among-Millennial-and-Gen-Z-home-buyers-seeking-extra-income" rel="noopener noreferrer" target="_blank">says</a>:
“For those first-time buyers navigating the ‘side hustle culture,’ where a regular 9-to-5 might not quite cut it for homeownership dreams, rental income can step in to help . . .”
Basically, it can help you afford your monthly mortgage payments. So if you’re open to it, renting out a portion of your home not only helps with <a href="https://www.keepingcurrentmatters.com/2023/11/16/people-are-still-moving-even-with-todays-affordability-challenges/" rel="noopener noreferrer" target="_blank">affordability</a>, but it also positions you as an investor and turns <a href="https://www.keepingcurrentmatters.com/2023/11/01/what-are-accessory-dwelling-units-and-how-can-they-benefit-you/" rel="noopener noreferrer" target="_blank">your home</a> into a source of income.
Bottom Line
Given the current affordability challenges, both of these approaches present more achievable routes to homeownership, particularly for younger buyers. If you wish to delve into these possibilities and understand how they could unfold in your local market, reach out to a reliable real estate agent for guidance.
2023-12-08T18:17:58-07:002023-12-12T11:10:46-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40698Home Prices Predicted to Surge in the Next 5 Years <a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-Experts-Project-Home-Prices-Will-Rise-over-the-next-5-years.png" title="Even with so much data showing home prices are actually rising in most of the country, there are still a lot of people who worry there will be another price crash in the immediate future." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-Experts-Project-Home-Prices-Will-Rise-over-the-next-5-years.png" alt="Experts Project Home Prices Will Rise over the Next 5 Years" /></a>
Despite prevailing data indicating a consistent rise in home prices across the country, concerns persist about a potential price downturn in the near future. According to a recent Fannie Mae survey, 23% of consumers anticipate a decline in prices over the next 12 months, reflecting apprehensions that might resonate with you.
To address these concerns, it's crucial to consider the insights of industry experts regarding not only the upcoming year but the next five years. The Home Price Expectation Survey (HPES) by Pulsenomics offers a comprehensive overview, collating projections from over 100 economists, investment strategists, and housing market analysts. The collective forecast indicates a continuous appreciation in home prices annually through 2027, as depicted in the graph below. Explore the insights of this diverse group of experts to gain a more comprehensive understanding of the trajectory of home prices in the coming years.
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-Estimated-Home-Price-Performance.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-Estimated-Home-Price-Performance.png" /></a>
Although the anticipated surge in 2024 may not match the scale of 2023, it's essential to recognize that home price appreciation is cumulative. In simpler terms, if the experts' projections hold true and your home's value increases by 3.32% this year, it is expected to further rise by 2.17% in the subsequent year.
For those concerned about the possibility of declining home prices, the key insight is this: despite regional variations, experts forecast a sustained upward trajectory across the country for the foreseeable future, aligning with a market pace that is considered more normal.
What Does This Mean for You?
If you remain unconvinced, perhaps these figures will capture your interest. They illustrate the potential evolution of a typical home's value in the coming years based on expert forecasts from the HPES. Refer to the graph below for a visual representation.
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-71363-Home-Price-Expectation-Survey.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231128/20231205-71363-Home-Price-Expectation-Survey.png" /></a>
In this example, let’s say you bought a $400,000 home at the beginning of this year. If you factor in the forecast from the HPES, you could potentially accumulate more than $71,000 in <a href="https://www.keepingcurrentmatters.com/2023/10/25/invest-in-yourself-by-owning-a-home/" rel="noopener noreferrer" target="_blank">household wealth</a> over the next five years.
Bottom Line
For those who harbor concerns about a potential decline in home prices, take comfort in the consensus among numerous experts indicating quite the opposite. Nationally, the consensus is that home prices will not only persistently climb in the upcoming year but for several years ahead. Should you have any inquiries or apprehensions regarding the trajectory of home prices in your local area, consider reaching out to a trusted real estate agent for guidance.
2023-12-05T07:58:46-07:002023-12-06T09:01:01-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40633Is Homeownership Still the American Dream for Younger Buyers<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Is-Owning-a-Home-Still-the-American-Dream-for-Younger-buyers.png" title="Everyone has their own idea of the American Dream, and it's different for each person." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Is-Owning-a-Home-Still-the-American-Dream-for-Younger-buyers.png" alt="Is Owning a Home Still the American Dream for Younger Buyers?" /></a>
Individuals harbor unique perceptions of the American Dream, varying from person to person. However, a recent Bankrate survey inquired about the accomplishments deemed most emblematic of the American Dream. The responses underscore that, for a considerable number of Americans, owning a home remains the top-ranking aspiration in contemporary society. (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Homeownership-Remains-the-1-feature-of-the-american-dream.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Homeownership-Remains-the-1-feature-of-the-american-dream.png" /></a>
Indeed, as depicted in the graph, the significance attributed to owning a home surpasses that of retiring, achieving a successful career, or even obtaining a college degree. However, the question arises: does the dream of homeownership endure among younger generations?
A recent survey conducted by 1000watt delves into the sentiments of two generations often considered as potential renter demographics, namely Gen Z and millennials, regarding their perspectives on homeownership. More precisely, the survey inquires about their inclination to pursue homeownership in the future. The emphatic response indicates a resounding yes.
(see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Gen-Z-and-millenials-do-you-want-to-buy-a-home-at-some-point-in-the-future.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Gen-Z-and-millenials-do-you-want-to-buy-a-home-at-some-point-in-the-future.png" /></a>
Although numerous factors may influence a preference for homeownership over renting, the 1000watt survey reveals that, for 63% of Gen Z and millennials, the primary motivation is the sense that a place doesn't truly feel like "home" unless it's owned – a sentiment that may resonate with many.
This emotional connection becomes more apparent when examining the motivations behind Gen Z and millennials aspiring to become homeowners. Despite the financial advantages that homeownership offers, the survey indicates that, in most instances, the driving force is the desire for lifestyle or emotional benefits.
(see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Whats-the-primary-reason-you-want-to-own-a-home.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231130-Whats-the-primary-reason-you-want-to-own-a-home.png" /></a>
What Does This Mean for You?
If you belong to Generation Z or are a millennial and find yourself prepared, eager, and financially capable of purchasing a home, having an excellent real estate agent by your side is essential. Their seasoned experience and knowledge of the local housing market can be instrumental in navigating challenges such as current high mortgage rates, limited inventory, and escalating home prices. With their guidance, you can overcome these obstacles and successfully find your first home, transforming your homeownership dream into a tangible reality.
Working with a local real estate agent to find your dream home is the key to unlocking the American Dream.
Bottom Line
Acquiring a home is a substantial and pivotal decision, symbolizing the essence of the American Dream. To achieve this significant goal, take the first step by initiating a conversation with a local real estate expert today. Their guidance and expertise can set you on the path to realizing your homeownership aspirations.
2023-11-30T20:47:48-07:002023-12-04T11:55:17-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40594The Top 3 Housing Market Questions on Your Mind?
<img src="https://assets.site-static.com/userfiles/3675/image/Blog_Images/Top_3_Housing_Market_1.jpg" width="696" height="381" />
In the current state of the housing market, there is considerable confusion. Conversations with friends, news reports, and social media posts often present conflicting information. If you're considering a move, this can lead to numerous lingering questions. This is where a reliable local real estate agent becomes invaluable.
Explore the top three questions people have about today's housing market and find data-backed answers to guide you.
1. What’s Next for Mortgage Rates?
Mortgage rates have reached higher levels compared to recent years, impacting the affordability of homes for potential buyers. The uncertainty surrounding future mortgage rates is a common concern for many. While it's challenging to provide a definitive answer, historical trends offer some insights.
Mortgage rates and inflation share a longstanding correlation. When inflation rates are high, mortgage rates tend to rise accordingly. In the past year, inflation has been on the rise, leading to an increase in mortgage rates. However, as inflation begins to ease, the Federal Reserve has opted to pause federal funds rate hikes. Consequently, many experts anticipate a potential decline in mortgage rates in the near future.
There have been subtle indications of somewhat lower mortgage rates in recent weeks, albeit with notable volatility, a trend that may persist into the coming year. While some ongoing fluctuations are anticipated, the outlook suggests a potential downward trend in 2024. As noted by Aziz Sunderji, Strategist at Home Economics:
“The bottom line is that interest rates are likely to be lower-perhaps even lower than many optimists think - in the weeks and months to come.”
2. Where Are Home Prices Headed?
While there were concerns that home prices might experience a significant downturn this year, the data indicates that this did not occur. In fact, home prices are on the rise across most of the nation. Experts predict that this upward trend will persist, albeit at a more gradual pace, which is considered a healthier and more typical pattern for the housing market.
To underscore the confidence in this sustained appreciation, consider the insights from the Home Price Expectation Survey conducted by Pulsenomics. This survey involves a national panel comprising over 100 economists, real estate experts, and investment and market strategists. As depicted in the graph below, there is a consensus that home prices will continue to climb not only next year but also in the years to come.
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231128-Estimated-Home-Price-Performance.png" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231128-Estimated-Home-Price-Performance.png" /></a>
3. Is a Recession Around the Corner?
Although discussions about a possible recession have been prevalent in recent years, there is encouraging news on that front.
Regularly polling experts on this matter, The Wall Street Journal (WSJ) found that a year ago, the majority of experts anticipated a recession by this point. However, as experts assess current leading indicators, they are revising their views, suggesting that the likelihood of a recession is diminishing. The latest findings reveal a growing consensus among experts that we are not on track for another recession, as depicted in the chart below:
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231128-Do-Experts-Think-a-Recession-is-Coming.png" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231127/20231128-Do-Experts-Think-a-Recession-is-Coming.png" /></a>
This is big news for the <a href="https://www.mykcm.com/2023/10/31/foreclosures-and-bankruptcies-wont-crash-the-housing-market/" rel="noopener noreferrer" target="_blank">housing market</a>. And while the 48% to 52% split may seem close to half and half, the key thing to focus on is that the majority of these experts think we’ve avoided a recession already.
Bottom Line
The key message here is that the data indicates no reason for alarm; rather, there are more optimistic signals. Feel free to reach out, and we can discuss any housing market questions you may have as we approach the new year.
2023-11-29T04:01:42-07:002023-11-29T07:28:51-07:00Bill Howelltag:homesoldflorida.com,2012-09-20:40573 Is Wall Street Acquiring a Majority of Residential Properties in the United States?<img src="https://assets.site-static.com/userfiles/3675/image/Blog_Images/Wallstreet_buying_houses_in_the_US.jpg" width="525" height="350" alt="Explore the latest real estate insights that could impact your home-buying decisions. Discover the influence of investors, including Wall Street firms, on the current U.S. housing market. We break down the data on home ownership and rentals, revealing that institutional investors aren't dominating as perceived. Dive into the categories of investors, highlighting the significant role played by small mom & pop investors. Get informed about homeownership and rental dynamics, separating fact from fiction. Rely on trusted real estate professionals for expert guidance in navigating the housing market intelligently." title="Wallstreet buying all homes in the US" />
Are you thinking of buying a new home? Staying updated on recent real estate news is crucial to understanding factors that might influence your decision. If you've come across discussions about investors and their impact on the housing market, you may be pondering questions such as:
How many homes do investors own?
Are institutional investors, like large Wall Street Firms, really buying up so many homes that the average person can’t find one?
To answer those questions, here’s the real story of what’s happening based on the data.
To begin, let's determine the total count of single-family homes (SFHs) and the percentage that constitutes rental properties owned by investors. SFR Investor, specializing in the U.S. single-family rental market, reports a total of eighty-two million single-family homes in the country. The crucial question is: how many of them are actually rentals?
As outlined in a recent post, data reveals that sixty-eight million homes, equivalent to 82.93%, are owner-occupied, indicating that the homeowner resides in the property. By subtracting this figure from the total count of single-family homes (82 million), we arrive at approximately fourteen million homes classified as single-family rentals (SFRs)..
Do institutional investors own all of those remaining fourteen million homes? Not even close. Let’s take it one step further. There are four categories of investors:
The mom & pop investor who owns between 1-9 SFRs
The regional investor who owns between 10-99 SFRs
Smaller national investor who owns between 100-999 SFRs
The institutional investor who owns over 1,000 SFRs
These categories show that not all investors are large institutional investors. To help convey that even more clearly, here are the percentages of rental homes owned by each type of investor (see chart below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231116/20231127-Who-Owns-All-the-Single-Family-Rentals.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231116/20231127-Who-Owns-All-the-Single-Family-Rentals.png" /></a>
Looking at the chart, it's clear that despite what the news says, most homes aren't owned by big companies. Instead, regular folks, like your friends and neighbors, own the majority.
What's really happening is that people, just like you, believe in owning a home. They see buying a home, maybe even a second one, as a good investment. Some saw a chance to get a second home in the past few years for extra income by renting it out. Others just decided to keep their first house instead of selling it when they moved up.
So, don’t believe everything you read or hear about institutional investors. They aren’t buying up all the homes and making it impossible for the average person to buy. That’s just not what the numbers show. Institutional investors are actually the smallest piece of the pie chart.
Bottom Line
Sure, institutional investors do play a role in the single-family rental market, but they're not grabbing every house available. If you have more questions about what's going on in the housing market, reach out to a reliable real estate expert for the context you're looking for.
2023-11-27T23:06:57-07:002023-11-28T00:37:09-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40519 Why Homeowners Love Owning<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231115/20231123-Why-Homeowners-are-thankful-they-own.png" title="Countless people have set out on the exciting journey of homeownership." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20231115/20231123-Why-Homeowners-are-thankful-they-own.png" alt="Why Homeowners Are Thankful They Own" /></a>
Many individuals have embarked on the thrilling journey of becoming homeowners, and the overwhelming sentiment is one of gratitude for taking that leap. The question arises: why? The answer lies in the multitude of emotional and lifestyle benefits that come with owning a home.
If you find yourself at the crossroads of deciding between renting and buying, here are just a few of the numerous advantages you could enjoy as a homeowner.
A Safe Haven: Homeownership extends beyond having a mere roof over your head; it offers a profound sense of security and safety. Survey results from Fannie Mae indicate that "having a sense of privacy and security" is among the top reasons people prefer homeownership over renting. Your home becomes a sanctuary, providing comfort and peace at the end of each day.
A Canvas for Self-Expression: For many, a home is a canvas for self-expression. As the National Association of Realtors (NAR) emphasizes, "The home is yours. You can decorate any way you want and choose the types of upgrades and new amenities that appeal to your lifestyle." Every detail, from the front door color to the artwork on the walls, contributes to a unique expression of personal style. Simply put, homeownership grants you the freedom to make changes that resonate with your personality.
Community Connection: Stability is a fundamental aspect of homeownership. The longer you reside in one place, the stronger your emotional connection to the community becomes. This sense of stability fosters engagement and the building of meaningful relationships with neighbors. According to NAR, "Remaining in one neighborhood for several years allows you and your family time to build long-lasting relationships within the community."
Where Lifelong Memories Are Made: Your home is not just a place to live; it's a backdrop for the stories of your life. Celebrating milestones, hosting gatherings, and creating a treasure trove of special moments within your home is an enriching experience to be grateful for.
In conclusion, as you contemplate the prospect of homeownership, remember that it goes beyond a mere financial decision. It's about establishing a stable haven for making enduring memories. If you're considering buying a home and seek advice, reach out to a trusted real estate agent.
Bottom Line
As you start thinking about buying a home, remember why so many people are glad they did. Homeownership isn’t just a <a href="https://www.keepingcurrentmatters.com/2023/11/14/home-prices-keep-climbing-in-most-markets/" rel="noopener noreferrer" target="_blank">financial decision</a>. It’s about having a stable place where you can make lasting memories. If you're thinking of buying a home and want advice, talk with a trusted <a href="https://www.keepingcurrentmatters.com/2023/10/30/a-real-estate-agent-helps-take-the-fear-out-of-the-market/" rel="noopener noreferrer" target="_blank">real estate agent</a>.
2023-11-23T23:27:10-07:002023-11-29T10:43:10-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:404122024 Housing Market Outlook: What to Expect Next<img src="https://assets.site-static.com/userfiles/3675/image/bhnew17.jpg" width="1200" height="628" />
The upcoming new year prompts contemplation on whether 2024 is an opportune time for real estate transactions. To make well-informed decisions, understanding the insights of experts regarding the future of the housing market is crucial. Surprisingly, the projections indicate a more optimistic outlook than anticipated. Here's the breakdown.
Experts Forecast Ongoing Home Price Appreciation
Take a look at the latest home price forecasts from <a href="https://www.fanniemae.com/media/49326/display" rel="noopener noreferrer" target="_blank">Fannie Mae</a>, the <a href="https://www.mba.org/docs/default-source/research-and-forecasts/forecasts/2023/mortgage-finance-forecast-oct-2023.pdf" rel="noopener noreferrer" target="_blank">Mortgage Bankers Association</a> (MBA), and the <a href="https://cdn.nar.realtor/sites/default/files/documents/forecast-q4-2023-us-economic-outlook-10-26-2023.pdf" rel="noopener noreferrer" target="_blank">National Association of Realtors</a> (NAR):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231114/20231115-Home-Price-Forecasts-for-2023-and-2024.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231114/20231115-Home-Price-Forecasts-for-2023-and-2024.png" /></a>
The orange bars on the left reveal that, on average, experts predict a year-end price increase of approximately 2.8% for this year, followed by an additional 1.5% hike by the close of 2024. This is significant news, particularly given widespread expectations of a market crash in 2023. Contrary to those predictions, prices did not experience a significant decline this year. The underlying factor is the persistent shortage of available homes compared to the demand, creating an inventory crunch. This imbalance in supply and demand continues to exert upward pressure on prices as we head into the upcoming year.
Looking ahead, experts anticipate a continued increase in home prices next year, albeit at a slightly slower pace than in the current year. Despite the less substantial projected rise in 2024 compared to 2023, it's crucial to grasp that home price appreciation is cumulative. In simpler terms, if the experts' predictions hold true, the national average suggests that following a 2.8% increase in your home's value this year, it should see an additional 1.5% increase next year. This sustained growth in home prices underscores the long-term financial wisdom of homeownership.
Projections Show Sales Should Increase Slightly Next Year
While 2023 hasn’t seen a lot of home sales relative to more normal years in the housing market, experts are forecasting a bit more activity next year. Here’s what those same three organizations project for the rest of this year, and in 2024 (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231114/20231115-Total-Home-Sales-Forecasts-for-2023-and-2024.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231114/20231115-Total-Home-Sales-Forecasts-for-2023-and-2024.png" /></a>
Anticipations suggest a modest increase in total home sales, which is positive news for both the housing market and individuals navigating buying or selling processes. The heightened activity in the upcoming year is beneficial for prospective buyers, creating more options in the housing market.
What do these forecasts indicate? The housing market is projected to experience increased activity in 2024. This can be attributed, in part, to the ongoing necessity for people to relocate due to various life changes such as job transitions, family expansions, or personal relationship adjustments. These significant life events continue to drive housing market activity regardless of overall market conditions. Furthermore, should mortgage rates decrease, it is likely to further stimulate activity in the housing market.
Bottom Line
For those considering buying or selling a home, staying informed about the housing market's future is crucial. Being aware of upcoming trends empowers you to make well-informed decisions. Connect with a local real estate agent to discuss the latest forecasts and strategize for your next move.2023-11-15T21:00:49-07:002023-12-14T11:55:47-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40375Transformative Events Shaping the Housing Market<a href="https://files.keepingcurrentmatters.com/content/images/20231108/20231113-Life-Changing-Events-That-Move-the-Housing-Market.png" title="Life is a journey filled with unexpected twists and turns, like the excitement of welcoming a new addition, retiring and starting a new adventure, or the bittersweet feeling of an empty nest." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231108/20231113-Life-Changing-Events-That-Move-the-Housing-Market.png" alt="Life-Changing Events That Move the Housing Market" /></a>
Life is an unpredictable journey, marked by moments of joy, such as welcoming a new family member, embarking on a retirement adventure, or the poignant experience of an empty nest. When faced with such significant life changes, the consideration of buying or selling a house often arises, as these transformative events often entail a need to relocate.
Reasons People Still Need To Move Today
<a href="https://www.realtormagdigital.com/realtor/library/item/fall_2023/4139952/" rel="noopener noreferrer" target="_blank">According</a> to the National Association of Realtors (NAR) there have been a lot of this type of milestone or life change over the last two years (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231108/20231113-Life-Changing-Events-That-Took-Place-Over-the-Last-2-Years.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231108/20231113-Life-Changing-Events-That-Took-Place-Over-the-Last-2-Years.png" /></a>
These significant life changes will persist in influencing people's decisions, despite the existing affordability challenges posed by increased mortgage rates and escalating home prices.
As highlighted by Claire Trapasso, Executive News Editor at Realtor.com:
"Because high mortgage rates, elevated home prices, and stubbornly low inventory make today’s housing market particularly challenging, many of today’s buyers are motivated by life changes, such as growing families, supporting elderly parents or grown children, or accommodating professional needs. . ."
Lean On a Real Estate Professional for Help
Whether you’re beginning <a href="https://www.keepingcurrentmatters.com/2023/10/26/affordable-homeownership-strategies-for-gen-z/" rel="noopener noreferrer" target="_blank">your search</a> for a home or preparing to sell your current house, you don’t have to go it alone. With their expertise, a <a href="https://www.keepingcurrentmatters.com/2023/10/30/a-real-estate-agent-helps-take-the-fear-out-of-the-market/" rel="noopener noreferrer" target="_blank">real estate agent</a> is an invaluable partner who can help you smoothly transition through these big moments in your life. Here are just a few examples.
When Buying a Home
Welcoming a new addition and requiring more space could make finding a new home a pressing priority. Despite the challenges posed by higher home prices and mortgage rates, addressing your evolving needs in today's mortgage rate environment might be essential.
A proficient real estate agent can be a valuable asset. Leveraging their expertise and familiarity with the local housing market can significantly reduce your time and alleviate stress. An agent will dedicate time to comprehend your specific requirements, budget constraints, and preferences, streamlining your search and offering viable options.
When Selling a House
If you're retiring or undergoing a separation or divorce, maximizing your investment when selling your house might be your primary goal. You aim to secure a property that aligns better with your future plans.
In such situations, the expertise of a real estate agent becomes invaluable. They can conduct a precise evaluation of your home's market value, recommend enhancements to boost its attractiveness, and devise a strategic marketing strategy. With strong negotiation skills, they ensure you receive a fair price for your house, enabling you to transition to the next chapter of your life with confidence and peace of mind.
No matter your situation, lean on a trusted professional for help as you buy or sell a home.
Bottom Line
If recent life-altering events have prompted you to consider a move, reach out to a local real estate agent.
2023-11-14T19:47:55-07:002023-12-14T12:14:32-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40295How VA Loans Can Turn Homeownership Dreams into Reality<a href="https://files.keepingcurrentmatters.com/content/images/20231107/20231108-How-VA-Loans-Can-Help-Make-Homeownership-Dreams-Come-True-BB.png" title="For more than 79 years, Veterans Affairs (VA) home loans have helped millions of veterans buy their own homes." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231107/20231108-How-VA-Loans-Can-Help-Make-Homeownership-Dreams-Come-True-BB.png" alt="How VA Loans Can Help Make Homeownership Dreams Come True" /></a>
For over 79 years, Veterans Affairs (VA) home loans have been instrumental in assisting numerous veterans in achieving homeownership. It's crucial for both veterans and those connected to them to understand the program and its benefits before embarking on the journey to purchase a home. Here are key aspects to be aware of regarding VA loans.
The Many Advantages of VA Home Loans
VA home loans offer a route to homeownership for individuals who have served our nation, representing a valuable benefit for qualifying buyers. As stated by the Department of Veteran Affairs:
Options for No Down Payment: Qualified borrowers can often purchase a home with no down payment. That’s a huge weight lifted when you’re trying to save for a home.
Limited Closing Costs: There are limits on the types of closing costs you pay when you qualify for a VA home loan. So, more money stays in your pocket when it’s time to seal the deal.
Don’t Require Private Mortgage Insurance (PMI): Many other loans with down payments under 20% require PMI. VA loans do not, which means veterans can save on their monthly housing costs.
A recent article from <a href="https://www.veteransunited.com/valoans/10-things-many-borrowers-dont-know-about-va-loans/" rel="noopener noreferrer" target="_blank">Veterans United</a> sums up just how impactful this loan option can be:
“For the vast majority of military borrowers, VA loans represent the most powerful lending program on the market. These flexible, $0-down payment mortgages have helped more than 24 million service members become homeowners since 1944.”
Bottom Line
Homeownership embodies the American Dream. Veterans, who make significant sacrifices to protect our nation, deserve to be informed about the numerous advantages that VA home loans offer. Thank you for your service.
2023-11-09T21:53:15-07:002023-12-14T12:19:16-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40262Considering Tapping Into Your 401(k) for Home Purchase?<a href="https://files.keepingcurrentmatters.com/content/images/20231107/20231108-Thinking-About-Using-Your-401k-to-buy-a-house.png" title="Are you dreaming of buying your own home and wondering about how you’ll save for a down payment? You're not alone." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231107/20231108-Thinking-About-Using-Your-401k-to-buy-a-house.png" alt="Thinking About Using Your 401(k) To Buy a Home?" /></a>
Dreaming of homeownership and considering using your 401(k) for a down payment? Many share this idea, but before tapping into your retirement savings, it's crucial to explore alternative options and consult with a financial expert for a comprehensive understanding.
The Numbers May Make It Tempting
The <a href="https://www.cnbc.com/2023/06/03/fidelity-how-much-americans-have-in-their-401ks-at-every-age.html" rel="noopener noreferrer" target="_blank">data</a> shows many Americans have saved a considerable amount for retirement (see chart below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231107/20231108-Average-401-balance-by-age.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231107/20231108-Average-401-balance-by-age.png" /></a>
The allure of using a well-padded 401(k) for your dream home can be strong. However, it's crucial to bear in mind that tapping into your retirement savings might entail penalties and impact your future finances. Therefore, thoroughly exploring all available options for saving a down payment and purchasing a home is essential. According to Experian:
"While it's possible to use funds from your 401(k) to buy a house, the decision depends on several factors, such as taxes and penalties, your existing savings, and your individual financial situation."
Alternative Ways To Buy a Home
Using your 401(k) is one way to finance a <a href="https://www.keepingcurrentmatters.com/2023/10/06/how-homeowner-net-worth-grows-with-time-infographic/" rel="noopener noreferrer" target="_blank">home</a>, but it’s not the only option. Before you decide, consider a couple of other methods, courtesy of <a href="https://www.experian.com/blogs/ask-experian/use-401k-to-buy-house/" rel="noopener noreferrer" target="_blank">Experian</a>:
<a href="https://www.hud.gov/buying/loans" rel="noopener noreferrer" target="_blank">FHA Loan</a>: FHA loans allow qualified buyers to put down as little as 3.5% of the home’s price, depending on their credit scores.
<a href="https://downpaymentresource.com/" rel="noopener noreferrer" target="_blank">Down Payment Assistance Programs</a>: There are many national and local programs that can help first-time and repeat homebuyers come up with the necessary down payment.
Above All Else, Have a Plan
Regardless of the path you choose to acquire a home, it's crucial to consult with a financial expert before taking any steps. Collaborating with a team of professionals to devise a solid plan before embarking on your homeownership journey is paramount for success. Kelly Palmer, Founder of The Wealthy Parent, emphasizes:
"I have seen parents pausing contributions to their retirement plans in favor of affording a larger home often with the hope they can refinance in the future... As long as there is a tangible plan in place to get back to saving for their retirement goals, I encourage families to consider all their options."
Bottom Line
If you're contemplating using your 401(k) retirement savings for a home down payment, thoroughly explore your alternatives and seek advice from a financial professional before making any decisions.
2023-11-09T01:44:36-07:002023-12-14T12:25:00-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40261The Net Worth of Homeowners Has Soared<a href="https://files.keepingcurrentmatters.com/content/images/20231031/20231107-Homeowner-Net-Worth-Has-Skyrocketed.png" title="If you’re weighing your options to decide whether it makes more sense to rent or buy a home today, here’s one key data point that could help you feel more confident in making your decision." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231031/20231107-Homeowner-Net-Worth-Has-Skyrocketed.png" alt="Homeowner Net Worth Has Skyrocketed" /></a>
If you're contemplating the choice between renting and buying a home, a crucial piece of data from the Federal Reserve Board's Survey of Consumer Finances (SCF) might bolster your decision-making confidence. Released every three years, the report delves into the disparity in net worth between homeowners and renters, and the findings reveal a substantial gap between the two.
The average homeowner’s net worth is almost 40X greater than a renter’s. And here’s the data to prove it (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231031/20231107-Homeowner-Net-Worth-Almost-40X-Greater.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231031/20231107-Homeowner-Net-Worth-Almost-40X-Greater.png" /></a>
The Big Reason Homeowner Net Worth Is So High
In the prior edition of the report, the average homeowner's net worth stood at approximately $255,000, while that of the average renter was $6,300. However, in the latest release, the gap expanded significantly as homeowner net worth experienced a substantial increase. According to the Survey of Consumer Finances (SCF) report:
". . . the 2019-2022 growth in median net worth was the largest three-year increase over the history of the modern SCF, more than double the next-largest one on record."
One of the biggest reasons homeowner net worth skyrocketed is <a href="https://www.keepingcurrentmatters.com/2023/09/19/your-home-equity-can-offset-affordability-challenges/" rel="noopener noreferrer" target="_blank">home equity</a>.
Over the past few years, often referred to as the 'unicorn' years for housing, home prices experienced a significant surge due to a shortage of available homes and a surge in buyers taking advantage of historically low mortgage rates. This supply-demand imbalance propelled prices to new heights, leading to substantial equity growth for most homeowners during that period.
If you're still contemplating whether to rent or buy, you might be wondering if you missed out on the substantial net worth boost. However, it's essential to understand that there are steps you can take to enhance your net worth in the coming years, and buying a home is one such strategy. As a recent article in The Ascent points out:
"Whether your net worth increased in recent years or not, there are steps you can take to boost that number in the coming years. . . buying a home can be a great way to grow your net worth, since home values have a tendency to rise over time."
Historically, home prices tend to appreciate over time. Even with mortgage rates currently in the 7-8% range, prices continue to rise in many areas due to a persistent supply-demand imbalance. Expert forecasts for the next few years predict ongoing appreciation, albeit at a more typical pace for the housing market.
While it may not match the unprecedented surge of the past few years, those who purchase homes now are expected to continue building equity in the years ahead. Therefore, if you're ready and able to buy a home today, you're making an investment that will contribute to growing your net worth in the long run.
As Jessica Lautz, Deputy Chief Economist at the National Association of Realtors (NAR), emphasizes:
". . . when deciding to rent vs buy, one must calculate the total cost of homeownership (maintenance, utilities, commuting, etc.) and the total financial benefit. Based on new Fed data . . . the median net worth of homeowners was $396,200 vs renters at $10,400. There is no question about the wealth gains that homeownership provides."
Bottom Line
If you're still undecided about whether to rent or buy a home, it's worth noting that homeownership has the potential to significantly enhance your net worth over time. To explore this further, along with the myriad other advantages of owning a home, consider reaching out to a local real estate agent who can provide valuable insights.
2023-11-09T01:34:42-07:002023-12-14T12:32:00-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40256Foreclosures and Bankruptcies Won’t Crash the Housing Market<a href="https://files.keepingcurrentmatters.com/content/images/20231030/20231031-Foreclosures-and-Bankruptcies-Won-t-Crash-the-Housing-Market.png" title="If you've been following the news recently, you might have seen articles about an increase in foreclosures and bankruptcies." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231030/20231031-Foreclosures-and-Bankruptcies-Won-t-Crash-the-Housing-Market.png" alt="Foreclosures and Bankruptcies Won’t Crash the Housing Market" /></a>
If you’ve been following the news recently, you might have seen articles about an increase in foreclosures and bankruptcies. That could be making you feel uneasy, especially if you’re thinking about <a href="https://www.keepingcurrentmatters.com/2023/10/17/how-buying-a-multi-generational-home-helps-with-affordability-today/" rel="noopener noreferrer" target="_blank">buying</a> or <a href="https://www.keepingcurrentmatters.com/2023/10/18/what-are-the-real-reasons-you-want-to-move-right-now/" rel="noopener noreferrer" target="_blank">selling</a> a house.
But the truth is, even though the numbers are going up, the <a href="https://www.keepingcurrentmatters.com/2023/09/27/why-todays-housing-inventory-shows-a-crash-isnt-on-the-horizon/" rel="noopener noreferrer" target="_blank">data shows</a> the housing market isn’t headed for a crisis.
Foreclosure Activity Rising, but Less Than Headlines Suggest
In recent years, the number of foreclosures has been very low. That’s because, in 2020 and 2021, the forbearance program and other relief options were put in place to help many homeowners stay in their homes during that tough time.
When the moratorium ended, there was an expected rise in foreclosures. But just because they’re up, that doesn’t mean the housing market is in trouble.
To help you see how much things have changed since the housing crash in 2008, check out the graph below using research from ATTOM, a property data provider. It looks at properties with a foreclosure filing going all the way back to 2005 to <a href="https://www.attomdata.com/news/market-trends/foreclosures/attom-q3-and-september-2023-u-s-foreclosure-market-report/" rel="noopener noreferrer" target="_blank">show</a> that there have been fewer foreclosures since the crash.
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231030/20231031-Foreclosure-Activity-Rose-In-Third-Quarter.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231030/20231031-Foreclosure-Activity-Rose-In-Third-Quarter.png" /></a>
As you can see, foreclosure filings are inching back up to pre-pandemic numbers, but they’re still way lower than when the housing market crashed in 2008. And today, the tremendous amount of <a href="https://www.keepingcurrentmatters.com/2023/10/12/growing-your-net-worth-with-homeownership/" rel="noopener noreferrer" target="_blank">equity</a> American homeowners have in their homes can help people sell and avoid foreclosure.
The Increase in Bankruptcies Isn’t Dramatic Either
As you can see <a href="https://www.uscourts.gov/news/2023/07/31/bankruptcy-filings-rise-10-percent" rel="noopener noreferrer" target="_blank">below</a>, the financial trouble many industries and small businesses felt during the pandemic didn’t cause a dramatic increase in bankruptcies. Still, the number of bankruptcies has gone up slightly since last year, nearly returning to 2021 levels. But that isn’t cause for alarm.
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231030/20231031-Bankruptcies-Below-Pre-Pandemic-Levels.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231030/20231031-Bankruptcies-Below-Pre-Pandemic-Levels.png" /></a>
The numbers for 2021 and 2022 were lower than more typical years. That’s in part because the government provided trillions of dollars in aid to individuals and businesses during the pandemic. So, let’s instead focus on the bar for this year and compare it to the bar on the far left (2019). It shows the number of bankruptcies today is still nowhere near where it was before the pandemic. Both of these two factors are reasons why the housing market isn’t in danger of crashing.
Bottom Line
Right now, it's crucial to understand the data. Foreclosures and bankruptcies are rising, but these leading indicators aren’t signaling trouble that would cause another crash.
2023-11-09T00:57:16-07:002023-11-09T01:00:53-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40255A Real Estate Agent Helps Take the Fear Out of the Market<a href="https://files.keepingcurrentmatters.com/content/images/20231025/20231030-A-Real-Estate-Agent-Helps-Take-the-Fear-Out-of-the-Market.png" title="Do negative headlines and talk on social media have you feeling worried about the housing market?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231025/20231030-A-Real-Estate-Agent-Helps-Take-the-Fear-Out-of-the-Market.png" alt="A Real Estate Agent Helps Take the Fear Out of the Market" /></a>
Do negative headlines and talk on social media have you feeling worried about the <a href="https://www.keepingcurrentmatters.com/2023/10/20/home-price-growth-is-returning-to-normal-infographic/" rel="noopener noreferrer" target="_blank">housing market</a>? Maybe you’ve even seen or heard something lately that scares you and makes you wonder if you should still <a href="https://www.keepingcurrentmatters.com/2023/10/17/how-buying-a-multi-generational-home-helps-with-affordability-today/" rel="noopener noreferrer" target="_blank">buy</a> or <a href="https://www.keepingcurrentmatters.com/2023/10/09/key-skills-you-need-your-listing-agent-to-have/" rel="noopener noreferrer" target="_blank">sell</a> a home right now.
Regrettably, when news in the media isn’t easy to understand, it can make people feel scared and unsure. Similarly, negative talk on social media spreads fast and creates fear. As Jason Lewris, Co-Founder and Chief Data Officer at Parcl, <a href="https://www.parcllabs.com/articles/q3-real-estate" rel="noopener noreferrer" target="_blank">says</a>:
“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”
But it doesn’t have to be that way. Buying a home is a big decision, and it should be one you <a href="https://www.keepingcurrentmatters.com/2023/10/18/what-are-the-real-reasons-you-want-to-move-right-now/" rel="noopener noreferrer" target="_blank">feel confident</a> making. You should lean on a trusted real estate agent to help you separate <a href="https://www.keepingcurrentmatters.com/2023/10/27/unmasking-scary-myths-about-todays-housing-market-infographic/" rel="noopener noreferrer" target="_blank">fact from fiction</a> and get the <a href="https://www.keepingcurrentmatters.com/2023/10/03/home-prices-are-not-falling/" rel="noopener noreferrer" target="_blank">answers</a> you need.
That agent will use their knowledge of what’s really happening with <a href="https://www.keepingcurrentmatters.com/2023/10/20/home-price-growth-is-returning-to-normal-infographic/" rel="noopener noreferrer" target="_blank">home prices</a>, <a href="https://www.keepingcurrentmatters.com/2023/10/24/the-perks-of-selling-your-house-when-inventory-is-low/" rel="noopener noreferrer" target="_blank">housing supply</a>, <a href="https://www.keepingcurrentmatters.com/2023/10/11/the-latest-expert-forecasts-for-home-prices-in-2023/" rel="noopener noreferrer" target="_blank">expert forecasts</a>, <a href="https://www.keepingcurrentmatters.com/2023/10/16/are-higher-mortgage-rates-here-to-stay/" rel="noopener noreferrer" target="_blank">and more</a> to give you the best possible advice. The National Association of Realtors (NAR) <a href="https://www.nar.realtor/magazine/real-estate-news/sales-marketing/bring-on-the-positive-vibes" rel="noopener noreferrer" target="_blank">explains</a>:
“. . . agents combat uncertainty and fear with a combination of historical perspective, training and facts.”
The right agent will help you figure out what’s going on at the national level and in your local area.
They’ll debunk headlines <a href="https://www.keepingcurrentmatters.com/2023/09/29/explaining-todays-low-housing-supply-infographic/" rel="noopener noreferrer" target="_blank">using data</a> you can trust. Plus, they have in-depth knowledge of the industry and can <a href="https://www.keepingcurrentmatters.com/2023/09/27/why-todays-housing-inventory-shows-a-crash-isnt-on-the-horizon/" rel="noopener noreferrer" target="_blank">provide context</a>, so you know how current trends compare to the normal ebbs and flows in the housing market, <a href="https://www.keepingcurrentmatters.com/2023/09/26/the-return-of-normal-seasonality-for-home-price-appreciation/" rel="noopener noreferrer" target="_blank">historical data</a>, and more.
Then, to make sure you have the full picture, an agent can tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you can use all that information to make the best possible decision.
After all, making a move is a potentially life-changing milestone. It should be something you feel <a href="https://www.keepingcurrentmatters.com/2023/09/25/beginning-with-pre-approval/" rel="noopener noreferrer" target="_blank">ready for</a> and excited about. And that’s where a trusted expert comes in.
Bottom Line
If you need reliable information about the housing market and expert advice about your own move, get in touch with a real estate agent in your area.
2023-11-09T00:53:05-07:002023-11-09T00:56:52-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40253Affordable Homeownership Strategies for Gen Z<a href="https://files.keepingcurrentmatters.com/content/images/20231023/20231026-Affordable-Homeownership-Strategies-for-Gen-Z.png" title="The idea of owning a home has always been a big part of the American Dream." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231023/20231026-Affordable-Homeownership-Strategies-for-Gen-Z.png" alt="Affordable Homeownership Strategies for Gen Z" /></a>
The idea of owning a home has always been a big part of the American Dream. It’s a symbol of stability, independence, and having a place to truly call your own. But for Gen Z, the “Zoomers” born between 1997 and 2012, making that dream a reality can feel like quite the challenge today with higher <a href="https://www.keepingcurrentmatters.com/2023/10/16/are-higher-mortgage-rates-here-to-stay/" rel="noopener noreferrer" target="_blank">mortgage rates</a> and rising <a href="https://www.keepingcurrentmatters.com/2023/10/11/the-latest-expert-forecasts-for-home-prices-in-2023/" rel="noopener noreferrer" target="_blank">home prices</a>.
But achieving that goal of owning your first home can still be attainable, even today, with some strategic planning and resourcefulness.
Explore Down Payment Assistance Options
With prices rising all around you, it can be hard to save up for a home. If you’ve been struggling to stash away enough cash for that down payment, it’s worth it to look into the various <a href="https://www.keepingcurrentmatters.com/2023/06/19/saving-for-a-down-payment-heres-what-you-need-to-know/" rel="noopener noreferrer" target="_blank">down payment</a> assistance programs available. These programs can really help you save big on the upfront costs of buying a home.
There are a lot more options out there than you may realize. According to <a href="https://downpaymentresource.com/" rel="noopener noreferrer" target="_blank">Down Payment Resource</a>, there are over 2,000 programs designed to help hopeful homebuyers with down payments and closing costs.
If you qualify for one of these programs, you may not need to save up as much money for your down payment. A local real estate agent can help you explore these programs in your area, making it much easier to turn your homeownership dream into a reality.
Consider Living with Relatives To Save
If you still need a bit more time to save, even with the down payment assistance programs out there, there are ways you can make that happen. Many savvy Zoomers have made a strategic choice to live with relatives so they can get to their savings goals even faster.
According to the <a href="https://www.nar.realtor/newsroom/baby-boomers-overtake-millennials-as-largest-generation-of-home-buyers" rel="noopener noreferrer" target="_blank">National Association of Realtors</a> (NAR), around 30% of Gen Z homebuyers transition directly from their relative’s home to a home of their own.
By sharing living costs, such as mortgage payments, utility bills, and even grocery expenses, you can substantially reduce your monthly expenses. This frees up more of your income to tackle any outstanding debt, boost your credit score, and reach your down payment target in less time. And, all of this can bring <a href="https://www.keepingcurrentmatters.com/2023/10/04/understanding-the-benefits-of-owning-your-first-home/" rel="noopener noreferrer" target="_blank">homeownership</a> one step closer to becoming a reality. Clare Trapasso, Executive News Editor at Realtor.com, <a href="https://mediaroom.realtor.com/2023-10-10-Hopeful-Homebuyers-Turn-Relatives-Into-Roommates-to-Save-Money-and-Share-Childcare" rel="noopener noreferrer" target="_blank">explains</a>:
“Faced with ongoing housing affordability issues . . . we’re seeing parents and children becoming roommates again in later years as the ‘kids’ save up to purchase their own place . . .”
The Road to Homeownership
When you’re on the path to becoming a homeowner, it’s a good idea to get some help along the way. And one of your best resources on this journey as a young homebuyer is a trusted <a href="https://www.keepingcurrentmatters.com/2023/08/23/why-you-need-a-true-expert-in-todays-housing-market/" rel="noopener noreferrer" target="_blank">real estate agent</a>. They’ll steer you through the process of buying a home and help you find one you can afford.
Bottom Line
For Gen Z, the path to homeownership may not be straightforward, but it's still within reach. With the right strategies, you can turn your dream of owning a home into a reality.
2023-11-09T00:43:13-07:002023-11-09T00:47:52-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40252Invest in Yourself by Owning a Home<a href="https://files.keepingcurrentmatters.com/content/images/20231023/20231025-Invest-in-yourself-by-owning-a-home.png" title="Are you wondering if it makes sense to buy a home right now?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231023/20231025-Invest-in-yourself-by-owning-a-home.png" alt="Invest in Yourself by Owning a Home" /></a>
Are you wondering if it makes sense to <a href="https://www.keepingcurrentmatters.com/2023/10/17/how-buying-a-multi-generational-home-helps-with-affordability-today/" rel="noopener noreferrer" target="_blank">buy a home</a> right now? While today’s <a href="https://www.keepingcurrentmatters.com/2023/10/16/are-higher-mortgage-rates-here-to-stay/" rel="noopener noreferrer" target="_blank">mortgage rates</a> might seem a bit intimidating, here are two compelling reasons why it still may be a good time to become a <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">homeowner</a>.
Home Values Appreciate over Time
There’s been a lot of confusion around what’s happened with home prices over the past two years. While they did dip ever so slightly in late 2022, this year they’ve been <a href="https://www.keepingcurrentmatters.com/2023/10/03/home-prices-are-not-falling/" rel="noopener noreferrer" target="_blank">appreciating</a> at a more normal pace, which is <a href="https://www.keepingcurrentmatters.com/2023/09/26/the-return-of-normal-seasonality-for-home-price-appreciation/" rel="noopener noreferrer" target="_blank">good news</a> for the housing market. And while looking at price movement over just a year or two can make you worry prices are usually this unpredictable, history shows in the long run, <a href="https://www.keepingcurrentmatters.com/2023/10/12/growing-your-net-worth-with-homeownership/" rel="noopener noreferrer" target="_blank">home values rise</a> (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231023/20231025-Price-Appreciation-over-the-Last-60-Years.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231023/20231025-Price-Appreciation-over-the-Last-60-Years.png" /></a>
Using data from the Federal Reserve for the past <a href="https://fred.stlouisfed.org/series/ASPUS" rel="noopener noreferrer" target="_blank">60 years</a>, you can see the overall trend is home prices have climbed quite steadily. Sure, there was an exception around the housing <a href="https://www.keepingcurrentmatters.com/2023/09/27/why-todays-housing-inventory-shows-a-crash-isnt-on-the-horizon/" rel="noopener noreferrer" target="_blank">crash of 2008</a> that caused prices to break the usual trend for a time, but overall, home values have been consistently on the <a href="https://www.keepingcurrentmatters.com/2023/10/11/the-latest-expert-forecasts-for-home-prices-in-2023/" rel="noopener noreferrer" target="_blank">rise</a>.
Increasing home values is one great reason why buying may make more sense than renting. As prices rise, and as you pay down your mortgage, you build equity. Over time, that growing equity gives your <a href="https://www.keepingcurrentmatters.com/2023/10/12/growing-your-net-worth-with-homeownership/" rel="noopener noreferrer" target="_blank">net worth</a> a boost.
Rent Keeps Going Up Through the Years
Another reason you may want to consider buying a home instead of <a href="https://www.keepingcurrentmatters.com/2023/10/13/the-difference-between-renting-and-buying-a-home-infographic/" rel="noopener noreferrer" target="_blank">renting</a> is the never-ending rent hike. If you’ve ever felt the pinch of rent increasing year after year, you’re not alone. That’s because, rents have <a href="https://ipropertymanagement.com/research/average-rent-by-year" rel="noopener noreferrer" target="_blank">climbed steadily</a> over the past six decades (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231023/20231025-Increase-in-Rents-over-the-Last-60-Years.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231023/20231025-Increase-in-Rents-over-the-Last-60-Years.png" /></a>
By <a href="https://www.keepingcurrentmatters.com/2023/10/02/unpacking-the-long-term-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">buying a home</a>, you can lock in your monthly housing costs and bid farewell to those pesky rent hikes. That stability is a game-changer.
In the end, it all boils down to this: your housing payments are an investment, and you’ve got a choice to make. Do you want to invest in yourself or your landlord?
By becoming a <a href="https://www.keepingcurrentmatters.com/2023/10/06/how-homeowner-net-worth-grows-with-time-infographic/" rel="noopener noreferrer" target="_blank">homeowner</a>, you’re investing in your own future. When you rent, that’s money you never get back.
When you factor in home values consistently rising, plus the opportunity to get relief from never-ending rent hikes, homeownership can be a path to financial security. As Dr. Jessica Lautz, Deputy Chief Economist and VP of Research at the National Association of Realtors (NAR), <a href="https://www.forbes.com/advisor/mortgages/real-estate/is-buying-a-home-worth-it/" rel="noopener noreferrer" target="_blank">states</a>:
“If a homebuyer is financially stable, able to manage monthly mortgage costs and can handle the associated household maintenance expenses, then it makes sense to purchase a home.”
Bottom Line
When it comes down to it, buying a home offers more benefits than renting, even when mortgage rates are high. If you want to avoid increasing rents and take advantage of long-term home price appreciation, connect with a local real estate agent to go over <a href="https://www.keepingcurrentmatters.com/2023/09/22/how-remote-work-helps-with-your-house-hunt-infographic/" rel="noopener noreferrer" target="_blank">your options</a>.
2023-11-09T00:04:26-07:002023-11-09T00:09:24-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40246How Buying a Multi-Generational Home Helps with Affordability Today<a href="https://files.keepingcurrentmatters.com/content/images/20231013/20231017-How-Buying-a-Multi-Generational-Home-Helps-with-Affordability-Today.png" title="In today's world of rising housing costs, many buyers are looking for ways to still be able to buy a home." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231013/20231017-How-Buying-a-Multi-Generational-Home-Helps-with-Affordability-Today.png" alt="How Buying a Multi-Generational Home Helps with Affordability Today" /></a>
In today’s world of <a href="https://www.keepingcurrentmatters.com/2023/09/06/mortgage-rates-past-present-and-possible-future/" rel="noopener noreferrer" target="_blank">rising housing costs</a>, many buyers are looking for ways to still be able to buy a home. Some of them have found a solution in multi-generational living.
Multi-generational living is when two or more adult generations live together under one roof. This includes siblings, parents, or even grandparents. Here’s an in-depth look at why more buyers are choosing this option today, so you can see if it may be right for you too.
Reasons To Buy a Multi-Generational Home
According to a <a href="https://www.nar.realtor/blogs/economists-outlook/all-in-the-family-multi-generational-home-buying" rel="noopener noreferrer" target="_blank">recent study</a> by the National Association of Realtors (NAR), the top two reasons people are opting for multi-generational homes today have to do with affordability (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231013/20231017-Reasons-to-Purchase-a-MultiGen-Home.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231013/20231017-Reasons-to-Purchase-a-MultiGen-Home.png" /></a>
Cost Savings: About 28% of first-time buyers and 11% of repeat buyers are deciding on a multi-generational home to save on costs. By pooling their resources, households can share the financial responsibilities like mortgage payments, utilities, property taxes, and maintenance, to make <a href="https://www.keepingcurrentmatters.com/2023/10/02/unpacking-the-long-term-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">homeownership</a> more affordable. This is especially helpful for <a href="https://www.keepingcurrentmatters.com/2023/10/04/understanding-the-benefits-of-owning-your-first-home/" rel="noopener noreferrer" target="_blank">first-time homebuyers</a> who may be finding it tough to afford a home on their own in today’s market.
More Space: Another 28% of first-time buyers and 18% of repeat buyers are doing it because they want a larger home they couldn’t afford on their own. For some of the <a href="https://www.keepingcurrentmatters.com/2023/09/11/planning-to-retire-your-equity-can-help-you-make-a-move/" rel="noopener noreferrer" target="_blank">repeat buyers</a> who listed this as a main motivator, it could be because they find themselves taking care of <a href="https://www.keepingcurrentmatters.com/2023/09/13/should-baby-boomers-buy-or-rent-after-selling-their-houses/" rel="noopener noreferrer" target="_blank">older parents</a> while also welcoming back young adults who’ve returned to the nest. With everyone chipping in and combining their incomes, suddenly, that big <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">dream home</a> with more space is within reach. As the Triangle Business Journal <a href="https://www.bizjournals.com/triangle/news/2023/04/01/why-choose-multigenerational-living-in-the-triangl.html" rel="noopener noreferrer" target="_blank">explains</a>:
“Choosing multi-gen living allows people to purchase a home much larger than they could afford on their own by leveraging the combined income, credit and a down payment of those that they will be occupying the home with.”
Lean on an Expert
If you’re interested in this too, partner with a local <a href="https://www.keepingcurrentmatters.com/2023/08/23/why-you-need-a-true-expert-in-todays-housing-market/" rel="noopener noreferrer" target="_blank">real estate agent</a>. Finding the perfect multi-generational home isn’t as simple as shopping for a regular house. That’s because there are more people with even more opinions and needs that should be considered.
You’ve got to make sure everyone has their own space, find room for shared household time, and possibly even create adaptable areas for older relatives. It’s a puzzle, and the pieces need to fit just right. Your real estate agent has the expertise and local knowledge to help you find that home where everyone can be comfortable without breaking the bank. As MoneyGeek.com <a href="https://www.moneygeek.com/mortgage/resources/multigenerational-family-finances/" rel="noopener noreferrer" target="_blank">puts</a> it:
“Having a good multigenerational property can improve the prospects of success when living with loved ones. A multigenerational home should fit the specific needs of most family members regardless of age or health. Speaking to a real-estate agent can help you gain clarity and locate a fit.”
Bottom Line
Buying a multi-generational home can be a smart way to tackle some of today’s affordability challenges. When you team up to share expenses, you can make your dream of homeownership more attainable. If this sounds like an option for you and your loved ones, connect with a local real estate agent to help you find a home that’s the perfect fit.
2023-11-08T23:10:23-07:002023-11-08T23:38:00-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40245Are Higher Mortgage Rates Here To Stay?<a href="https://files.keepingcurrentmatters.com/content/images/20231012/20231016-Are-Higher-Mortgage-Rates-Here-To-Stay.png" title="Mortgage rates have been back on the rise recently and that’s getting a lot of attention from the press." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231012/20231016-Are-Higher-Mortgage-Rates-Here-To-Stay.png" alt="Are Higher Mortgage Rates Here To Stay?" /></a>
<a href="https://www.keepingcurrentmatters.com/2023/09/06/mortgage-rates-past-present-and-possible-future/" rel="noopener noreferrer" target="_blank">Mortgage rates</a> have been back on the rise recently and that’s getting a lot of attention from the press. If you’ve been following the headlines, you may have even seen rates recently reached their <a href="https://freddiemac.gcs-web.com/node/27781/pdf" rel="noopener noreferrer" target="_blank">highest level</a> in over two decades (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231012/20231016-Mortgage-Rates-Reach-Highest-Level-In-Almost-23-Years.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231012/20231016-Mortgage-Rates-Reach-Highest-Level-In-Almost-23-Years.png" /></a>
That can feel like a little bit of a gut punch if you’re thinking about <a href="https://www.keepingcurrentmatters.com/2023/08/14/where-are-people-moving-today-and-why/" rel="noopener noreferrer" target="_blank">making a move</a>. If you’re wondering whether or not you should delay your plans, here’s what you really need to know.
How Higher Mortgage Rates Impact You
There’s no denying mortgage rates are higher right now than they were in recent years. And, when rates are up, that affects overall <a href="https://www.keepingcurrentmatters.com/2023/09/07/get-ready-for-smaller-more-affordable-homes/" rel="noopener noreferrer" target="_blank">home affordability</a>. It works like this. The higher the rate, the more expensive it is to borrow money when you <a href="https://www.keepingcurrentmatters.com/2023/08/17/people-want-less-expensive-homes-and-builders-are-responding/" rel="noopener noreferrer" target="_blank">buy a home</a>. That’s because, as rates trend up, your monthly <a href="https://www.keepingcurrentmatters.com/2023/05/19/the-impact-of-changing-mortgage-rates-infographic/" rel="noopener noreferrer" target="_blank">mortgage payment</a> for your future home loan also increases.
Urban Institute <a href="https://www.urban.org/urban-wire/rising-interest-rates-put-brakes-mortgage-market-borrowers-low-incomes" rel="noopener noreferrer" target="_blank">explains</a> how this is impacting buyers and sellers right now:
“When mortgage rates go up, monthly housing payments on new purchases also increase. For potential buyers, increased monthly payments can reduce the share of available affordable homes . . . Additionally, higher interest rates mean fewer homes on the market, as existing homeowners have an incentive to hold on to their home to keep their low interest rate.”
Basically, some people are deciding to put their plans on hold because of where mortgage rates are right now. But what you want to know is: is that a good <a href="https://www.keepingcurrentmatters.com/2023/07/03/evaluating-your-wants-and-needs-as-a-homebuyer-matters-more-today/" rel="noopener noreferrer" target="_blank">strategy</a>?
Where Will Mortgage Rates Go from Here?
If you’re eager for mortgage rates to drop, you’re not alone. A lot of people are waiting for that to happen. But here’s the thing. No one knows when it will. Even the experts can’t say with certainty what’s going to happen next.
<a href="https://www.keepingcurrentmatters.com/2023/08/04/housing-market-forecast-for-the-rest-of-2023-infographic-1/" rel="noopener noreferrer" target="_blank">Forecasts</a> project rates will fall in the months ahead, but what the latest <a href="https://www.freddiemac.com/pmms" rel="noopener noreferrer" target="_blank">data</a> says is that rates have been climbing lately. This disconnect shows just how tricky mortgage rates are to project.
The best advice for your move is this: don’t try to control what you can’t control. This includes trying to time the market or guess what the future holds for mortgage rates. As CBS News <a href="https://www.cbsnews.com/news/dont-wait-for-mortgage-rates-to-drop-do-this-instead/" rel="noopener noreferrer" target="_blank">states</a>:
“If you’re in the market for a new home, experts typically recommend focusing your search on the right home purchase — not the interest rate environment.”
Instead, work on building a team of <a href="https://www.keepingcurrentmatters.com/2023/08/23/why-you-need-a-true-expert-in-todays-housing-market/" rel="noopener noreferrer" target="_blank">skilled professionals</a>, including a trusted lender and real estate agent, who can explain what’s happening in the market and what it means for you. If you need to move because you’re <a href="https://www.keepingcurrentmatters.com/2023/06/13/your-needs-matter-more-than-todays-mortgage-rates/" rel="noopener noreferrer" target="_blank">changing jobs</a>, want to be closer to family, or are in the middle of another big <a href="https://www.keepingcurrentmatters.com/2023/08/29/why-you-may-still-want-to-sell-your-house-after-all/" rel="noopener noreferrer" target="_blank">life change</a>, the right team can help you <a href="https://www.keepingcurrentmatters.com/2023/09/19/your-home-equity-can-offset-affordability-challenges/" rel="noopener noreferrer" target="_blank">achieve your goal</a>, even now.
Bottom Line
The best advice for your move is: don’t try to control what you can’t control – especially mortgage rates. Even the experts can’t say for certain where they’ll go from here. Instead, focus on building a team of trusted professionals who can keep you informed. When you’re ready to get the process started, connect with a local real estate agent.
2023-11-08T22:22:41-07:002023-11-08T23:09:51-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40158Growing Your Net Worth with Homeownership<a href="https://files.keepingcurrentmatters.com/content/images/20231011/20231012-Growing-Your-Net-Worth-with-Homeownership.png" title="Take a moment to imagine where you want to be in a few years." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231011/20231012-Growing-Your-Net-Worth-with-Homeownership.png" alt="Growing Your Net Worth with Homeownership" /></a>
Take a moment to imagine where you want to be in a few years. You might be thinking about your job, money, wanting more stability, or goals you want to reach soon. Is <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">homeownership</a> a part of that vision? If it is, you should know owning a home has a whole lot of financial benefits.
One of the many reasons to <a href="https://www.keepingcurrentmatters.com/2023/10/06/how-homeowner-net-worth-grows-with-time-infographic/" rel="noopener noreferrer" target="_blank">buy a home</a> is that it’s a great way to build wealth and gain financial stability. That’s because the value of most homes increases over time, which in turn grows your <a href="https://www.keepingcurrentmatters.com/2023/10/02/unpacking-the-long-term-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">net worth</a>. Here’s how home values are rising right now. <a href="https://zillow.mediaroom.com/2023-09-26-U-S-housing-value-has-surged,-gaining-more-than-2-6-trillion-in-the-past-year" rel="noopener noreferrer" target="_blank">According</a> to Zillow:
“The total value of the U.S. housing market – the sum of Zillow’s estimated value for every U.S. home – is now slightly less than $52 trillion, which is $1.1 trillion higher than the previous peak reached last June.”
Basically, homeownership is a tremendous wealth-building tool. And with home values back <a href="https://www.keepingcurrentmatters.com/2023/10/03/home-prices-are-not-falling/" rel="noopener noreferrer" target="_blank">on the rise</a> across the nation, now might be a good time to consider if <a href="https://www.keepingcurrentmatters.com/2023/10/04/understanding-the-benefits-of-owning-your-first-home/" rel="noopener noreferrer" target="_blank">owning a home</a> is something you want to reach for.
Here’s a look at some data to see how much owning a home can really make a difference in your life.
Household Net Worth Is Rising
<a href="https://twitter.com/DianeSwonk/status/1706663509331718197" rel="noopener noreferrer" target="_blank">Data</a> shows that while those in the top 1% saw the most dramatic net worth increase, people from every single tax bracket have seen their wealth grow over the past few years (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231011/20231012-Household-Net-Worth-Up-Dramatically.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231011/20231012-Household-Net-Worth-Up-Dramatically.png" /></a>
For many of those people, the <a href="https://www.keepingcurrentmatters.com/2023/09/12/what-experts-project-for-home-prices-over-the-next-5-years/" rel="noopener noreferrer" target="_blank">rising value</a> of their home plays a big part in that.
Owning a Home Helps You Achieve Financial Success
You can tell homeownership had a lot to do with that growth because there’s a significant net worth gap between homeowners and renters. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), <a href="https://www.nar.realtor/magazine/real-estate-news/study-homeowner-wealth-is-40-times-higher-than-renters" rel="noopener noreferrer" target="_blank">says</a>:
“. . . homeownership is a catalyst for building wealth for people from all walks of life. A monthly mortgage payment is often considered a forced savings account that helps homeowners build a net worth about 40 times higher than that of a renter.”
The big reason why? Homeowner’s <a href="https://www.keepingcurrentmatters.com/2023/09/08/home-price-forecasts-revised-for-2023-infographic/" rel="noopener noreferrer" target="_blank">build equity</a>. Home equity is the value of your home minus the amount you owe on your mortgage. And for most homeowners, that’s the largest contributor to their net worth. Here’s the <a href="https://blog.firstam.com/economics/homeownership-remains-strongly-linked-to-wealth-building" rel="noopener noreferrer" target="_blank">data</a> from First American to prove it (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231011/20231012-Housing-Piece-of-Net-Worth-Is-Crucial-.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231011/20231012-Housing-Piece-of-Net-Worth-Is-Crucial-.png" /></a>
The blue portion of each bar represents housing as a portion of net worth – and it’s clearly a bigger contributor than other investments like stocks, gold, and cryptocurrencies. As you can see, across different income levels, homeownership does more to build the average household’s wealth than anything else.
Bottom Line
One of the biggest benefits of owning a home is that it can provide an avenue to grow your net worth. Connect with a local real estate professional so you can <a href="https://www.keepingcurrentmatters.com/2023/09/25/beginning-with-pre-approval/" rel="noopener noreferrer" target="_blank">start</a> investing in homeownership.
2023-11-02T19:49:43-07:002023-11-02T20:01:53-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40157Are Grandparents Moving To Be Closer to Their Grandkids?<a href="https://files.keepingcurrentmatters.com/content/images/20231005/20231010-Are-Grandparents-Moving-To-Be-Closer-to-Their-Grandkids.png" title="During the pandemic, many people distanced themselves from their loved ones for health reasons." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231005/20231010-Are-Grandparents-Moving-To-Be-Closer-to-Their-Grandkids.png" alt="Are Grandparents Moving To Be Closer to Their Grandkids?" /></a>
During the pandemic, many people distanced themselves from their loved ones for health reasons. <a href="https://www.keepingcurrentmatters.com/2023/09/13/should-baby-boomers-buy-or-rent-after-selling-their-houses/" rel="noopener noreferrer" target="_blank">Grandparents</a> were told to stay away from their grandkids, especially as schools started to open. That’s because it would have been risky to visit with their grandchildren who may have gotten sick from school.
Now that the pandemic has passed, many grandparents want more than ever to be near their grandchildren again to make up for that lost time. But how are they getting that “Grandparent Wish?” The data tells us many are <a href="https://www.keepingcurrentmatters.com/2023/09/11/planning-to-retire-your-equity-can-help-you-make-a-move/" rel="noopener noreferrer" target="_blank">moving</a> to make sure they’re getting more quality time.
Grandparents Are Moving To Be Near Loved Ones
Recent <a href="https://store.realtor/2022-nar-profile-of-home-buyers-and-sellers-download/" rel="noopener noreferrer" target="_blank">data</a> from the National Association of Realtors (NAR) shows people between the ages of 55 and 74 are moving farther (more than 100 miles) than any other age group (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231010-Grandparents-are-moving-farther-away.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231010-Grandparents-are-moving-farther-away.png" /></a>
The average age of grandparents in the U.S. is <a href="https://www.bgsu.edu/ncfmr/resources/data/family-profiles/westrick-payne-grandparents-characteristics-age-fp-23-02.html#%3A%7E%3Atext%3DGrandparenthood%20is%20more%20common%20among%2Cthose%20in%20midlife%20(33%25)" rel="noopener noreferrer" target="_blank">67 years</a>. The logical leap is that at least some of the people who are moving the furthest are grandparents. But what’s causing them to move so far?
The same report from NAR shows the top <a href="https://store.realtor/2022-nar-profile-of-home-buyers-and-sellers-download/" rel="noopener noreferrer" target="_blank">reason</a> people move is to be closer to loved ones (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231010-Sellers-Want-to-be-near-loved-ones.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231010-Sellers-Want-to-be-near-loved-ones.png" /></a>
Based on this data, it’s fair to say many grandparents are getting their wish of more quality time with their grandchildren by moving to be closer to them. And after experiencing isolation and loneliness during the COVID pandemic, that’s an especially good thing.
If you’re a grandparent, you know how important your grandchildren are. And you may be willing to sell and move just to be closer by. As Vance Cariaga, a journalist at Go Bank Rates, <a href="https://www.gobankingrates.com/retirement/planning/boomers-moving-further-from-home-close-to-grandbabies-is-it-good-financial-move/" rel="noopener noreferrer" target="_blank">explains</a>:
“Never underestimate the power of grandchildren – especially when it comes to lifestyle and financial decisions. Recent data shows that many baby boomers are relocating further away from home than they used to so they can be closer to their grandbabies.”
Bottom Line
The data shows grandparents are moving further to be near their grandchildren. If you have grandchildren of your own, maybe you can relate. When you decide it’s time to be closer to your loved ones, <a href="https://www.keepingcurrentmatters.com/2023/08/23/why-you-need-a-true-expert-in-todays-housing-market/" rel="noopener noreferrer" target="_blank">connect</a> with a local real estate professional.
2023-11-02T19:45:35-07:002023-11-02T19:48:33-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40154The Latest Expert Forecasts for Home Prices in 2023<a href="https://files.keepingcurrentmatters.com/content/images/20231005/20231011-The-Latest-Expert-Forecasts-for-Home-Prices-in-2023.png" title="Are you thinking about making a move?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231005/20231011-The-Latest-Expert-Forecasts-for-Home-Prices-in-2023.png" alt="The Latest Expert Forecasts for Home Prices in 2023" /></a>
Are you thinking about <a href="https://www.keepingcurrentmatters.com/2023/08/14/where-are-people-moving-today-and-why/" rel="noopener noreferrer" target="_blank">making a move</a>? If so, all the speculation that <a href="https://www.keepingcurrentmatters.com/2023/09/26/the-return-of-normal-seasonality-for-home-price-appreciation/" rel="noopener noreferrer" target="_blank">home prices</a> would crash this year may have you feeling a bit on edge about your decision. Let the data and the experts reassure you. Prices aren’t in a downward spiral and will actually finish the year strong.
Even though you may have heard talk that prices would drop 5, 10, or even 20% this year, that hasn’t happened. The big reason why is the <a href="https://www.keepingcurrentmatters.com/2023/09/27/why-todays-housing-inventory-shows-a-crash-isnt-on-the-horizon/" rel="noopener noreferrer" target="_blank">supply of homes</a> for sale is too low. There are just <a href="https://www.keepingcurrentmatters.com/2023/09/15/plenty-of-buyers-are-still-active-today-infographic/" rel="noopener noreferrer" target="_blank">more buyers</a> looking to buy than <a href="https://www.keepingcurrentmatters.com/2023/09/14/why-is-housing-inventory-so-low/" rel="noopener noreferrer" target="_blank">homes available</a>, and that’s kept prices from falling.
To prove this year wasn’t a bust for <a href="https://www.keepingcurrentmatters.com/2023/09/12/what-experts-project-for-home-prices-over-the-next-5-years/" rel="noopener noreferrer" target="_blank">home prices</a>, let’s look at the latest 2023 forecast from a number of experts.
Most Experts Project Home Prices Will Net Positive this Year
The general consensus from industry experts is that home <a href="https://www.keepingcurrentmatters.com/2023/09/05/expert-home-price-forecasts-revised-up-for-2023/" rel="noopener noreferrer" target="_blank">price appreciation</a> will actually be positive for 2023. The graph below shows the latest 2023 year-end forecasts from six different organizations:
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231011-2023-Year-End-Home-Price-Forecasts.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231005/20231011-2023-Year-End-Home-Price-Forecasts.png" /></a>
As you can see, all but one project nationally prices will net positive this year. That’s significant because it shows the majority are optimistic about home price growth.
If you’re still worried about the one red bar that shows an overall price drop for the year, think about this. The <a href="https://cdn.nar.realtor/sites/default/files/documents/forecast-q3-2023-us-economic-outlook-07-27-2023.pdf" rel="noopener noreferrer" target="_blank">projection</a> from the National Association of Realtors (NAR) is for only a slight decline. It’s not the big crash all the headlines called for. Plus, if you average all six forecasts together, the expectation is that prices will net somewhere around 3.3% positive growth for the year.
If these 6 organizations aren’t enough to convince you that prices won’t come tumbling down, here’s something else to consider. One of the six forecasts represented in the graph is the <a href="https://pulsenomics.com/surveys/#home-price-expectations" rel="noopener noreferrer" target="_blank">Home Price Expectation Survey</a> (HPES) from Pulsenomics. It combines survey results from over 100 economists, investment strategists, and housing market analysts. The HPES found that the average from all 100 of those experts is 3.3% price growth for the year.
If you look back at the graph above, you’ll notice the blue average for the forecasts in this graph is also 3.3%. While individual forecasts may vary, both the HPES survey and the average of these forecasts provide the same projection. And 3.3% appreciation is a completely different story than prices falling.
Bottom Line
If you’re worried about home prices falling this year, let the experts reassure you. Based on the average of the latest forecasts, home prices will actually show positive growth this year. If you have questions about what’s happening with home prices in your area, connect with a real estate agent.
2023-11-02T19:27:12-07:002023-11-02T19:32:34-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40153Are You a Homebuyer Worried About Climate Risks?<a href="https://files.keepingcurrentmatters.com/content/images/20231003/20231005-are-you-a-homebuyer-worried-about-climate-risks.jpg" title="The increasing effects of natural disasters are leading to new obstacles in residential real estate." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231003/20231005-are-you-a-homebuyer-worried-about-climate-risks.jpg" alt="Are You a Homebuyer Worried About Climate Risks?" /></a>
The increasing effects of natural disasters are leading to new obstacles in residential real estate. As a recent article from CoreLogic <a href="https://www.corelogic.com/intelligence/case-studies/climate-risk-modeling-future-for-real-estate-portfolios/" rel="noopener noreferrer" target="_blank">explains</a>:
“As the specter of climate change looms large, the world braces for unprecedented challenges. In the world of real estate, one of those challenges will be the effects of natural catastrophes on property portfolios, homeowners, and communities.”
That may be why, <a href="https://zillow.mediaroom.com/2023-09-05-More-than-80-of-home-shoppers-consider-climate-risks-when-looking-for-a-new-home" rel="noopener noreferrer" target="_blank">according</a> to Zillow, more and more Americans now consider how climate risks and natural disasters can impact their homeownership plans (see below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20231003/20231005-4-out-of-5-prospective-homebuyers.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20231003/20231005-4-out-of-5-prospective-homebuyers.png" /></a>
This study goes on to explain that climate risks affect where many people look for a home. That’s because homebuyers are interested in finding out if the house they want will be exposed to things like floods, extreme heat, and wildfires.
If you’re in the same situation and are thinking about what to do next, here’s some important information to consider as you start looking for a home.
Expert Advice for Homebuyers To Reduce Climate Risks
The <a href="https://www.keepingcurrentmatters.com/2023/09/25/beginning-with-pre-approval/" rel="noopener noreferrer" target="_blank">first thing</a> to do is understand how to go about buying a home while thinking about climate risks. With the right help and resources, you can simplify the process.
The Mortgage Reports provides these <a href="https://themortgagereports.com/99491/climate-change-global-warming-home-buying-impact" rel="noopener noreferrer" target="_blank">tips</a> for buying your next home:
Evaluate climate risks: Before buying a home, it’s important to check if it’s in a flood-prone area using the <a href="https://msc.fema.gov/portal/home" rel="noopener noreferrer" target="_blank">FEMA website</a>, review the seller’s property disclosure for any past damage, and get an inspection for issues like cracks and mold to make sure it’s a safe investment.
Consider future preventative maintenance costs: For areas that get tropical storms, you may need to purchase hurricane shutters and sandbags to protect the home. In wildfire-prone areas, you may want to clear plants five feet from the house, consider rooftop sprinklers, or possibly buy gutter guards to prevent fire hazards. Factor these future expenses in when touring homes that may need them.
Take steps to avoid losing your assets: Getting the right insurance for a home in a high-risk climate area is crucial. You should shop around and talk to multiple insurance agents to compare prices and options before deciding to bid on a home.
Above all else, your most <a href="https://www.keepingcurrentmatters.com/2023/08/23/why-you-need-a-true-expert-in-todays-housing-market/" rel="noopener noreferrer" target="_blank">valuable resource</a> during this process is a trusted real estate expert. They’ll always focus on your goals while keeping your concerns top of mind. Even if they don’t have all the answers about how your home can handle natural disasters, they can connect you with the right experts and information.
Bottom Line
If you want to <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">buy a home</a>, but you're also thinking about climate risks, you're not alone. Your home is a big investment, and if anything can impact that, you want to know. Connect with a real estate professional so you have someone you can trust to guide you as you find your next home.
2023-11-02T19:21:32-07:002023-11-02T19:26:27-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40152Understanding the Benefits of Owning Your First Home<a href="https://files.keepingcurrentmatters.com/content/images/20231003/20231004-Understanding-the-benefits-of-owning-your-first-home.png" title="Are you considering buying your first home?" class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20231003/20231004-Understanding-the-benefits-of-owning-your-first-home.png" alt="Understanding the Benefits of Owning Your First Home" /></a>
Are you considering buying your first <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">home</a>? If so, it can be helpful to know what led other people to make that decision. According to a <a href="https://s22.q4cdn.com/957797852/files/doc_news/2023/09/9-14-23-first-time-homebuyers-undeterred-by-rising-mortgage-interest-rates.pdf" rel="noopener noreferrer" target="_blank">recent survey</a> of first-time homebuyers by PulteGroup:
“When asked why they purchased their first home recently, the answer was simple: because they wanted to. Either the desire to stop renting or recognition that homeownership is a smart financial investment was the main motivator for 72% of respondents.”
While that survey looked specifically at first-time homebuyers buying newly built homes, the same sentiment is true for just about anyone buying their first home. Here’s a bit more information to help you think about those two benefits of homeownership to see if they’re a key factor for you too.
When You Buy a Home, You Have More Stability than When You Rent
You might want to stop renting because rents keep <a href="https://www.census.gov/housing/hvs/files/currenthvspress.pdf" rel="noopener noreferrer" target="_blank">going up</a>. If you’re a renter, that means there’s a chance your payment will increase each time you sign a new rental agreement or renew your current one.
On the other hand, when you buy your home with a fixed-rate mortgage, your monthly housing payment is predictable over the length of that loan. This stability can give you a peace of mind that renting just can’t provide. Jeff Ostrowski, real estate journalist, <a href="https://www.moneygeek.com/mortgage/resources/rent-vs-buy-guide/" rel="noopener noreferrer" target="_blank">breaks it down</a>:
“With a fixed-rate mortgage, your monthly principal and interest payment is set for as long as you keep the loan. Sign a rental lease, however, and you could see your rent rise the following year, the year after that and so on.”
When You Buy a Home, You Grow Your Wealth as Home Values Climb
Beyond that, owning a home can also be a great long-term investment. While renting may be the more affordable option right now, it doesn’t provide an avenue for you to grow your wealth over time. Mark Fleming, Chief Economist at First American, <a href="https://blog.firstam.com/economics/the-reconomy-podcast-should-you-rent-or-buy-a-home-right-now" rel="noopener noreferrer" target="_blank">explains</a> that’s an important distinction to consider:
“Given current dynamics, more young households may choose to rent in the near term as the cost to own, excluding house price appreciation, has unequivocally increased. Yet, accounting for house price appreciation in that cost of homeownership, whether to rent or buy will depend on where, and if, a home is likely to cost more or less in the near future.”
Basically, renting doesn’t allow you to build equity. In contrast, homeownership can help you grow your net worth as your home’s value <a href="https://www.keepingcurrentmatters.com/2023/09/08/home-price-forecasts-revised-for-2023-infographic/" rel="noopener noreferrer" target="_blank">appreciates</a>. That’s a significant perk you can’t get if you keep renting.
When you take that into account, it may make better financial sense to buy. Most experts project home prices will <a href="https://www.keepingcurrentmatters.com/2023/09/12/what-experts-project-for-home-prices-over-the-next-5-years/" rel="noopener noreferrer" target="_blank">continue to appreciate</a> over the next few years at a pace that’s more normal for the market. That means when you buy a home, not only are you investing in a place to live, but you’re also investing in your financial future.
Bottom Line
If you're ready, it can be a smart move to buy your first <a href="https://www.keepingcurrentmatters.com/2023/09/07/get-ready-for-smaller-more-affordable-homes/" rel="noopener noreferrer" target="_blank">home</a> instead of renting. Connect with a real estate professional so you can stabilize your housing payment and start building wealth for your future.
2023-11-02T19:17:12-07:002023-11-02T19:20:53-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40150Unpacking the Long-Term Benefits of Homeownership<a href="https://files.keepingcurrentmatters.com/content/images/20230928/20231002-Unpacking-the-long-term-benefits-of-homeownership.png" title="If you’re thinking about buying a home soon, higher mortgage rates, rising home prices, and ongoing affordability concerns may make you wonder if it still makes sense to buy a home right now." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20230928/20231002-Unpacking-the-long-term-benefits-of-homeownership.png" alt="Unpacking the Long-Term Benefits of Homeownership" /></a>
If you’re thinking about buying a home soon, higher <a href="https://www.keepingcurrentmatters.com/2023/09/06/mortgage-rates-past-present-and-possible-future/" rel="noopener noreferrer" target="_blank">mortgage rates</a>, rising <a href="https://www.keepingcurrentmatters.com/2023/09/08/home-price-forecasts-revised-for-2023-infographic/" rel="noopener noreferrer" target="_blank">home prices</a>, and ongoing affordability concerns may make you wonder if it still makes sense to buy a home right now. While those market factors are important, there’s more to consider. You should think about the long-term benefits of <a href="https://www.keepingcurrentmatters.com/2023/09/21/the-many-non-financial-benefits-of-homeownership/" rel="noopener noreferrer" target="_blank">homeownership</a> too.
Think about this: if you know people who bought a home 5, 10, or even 30 years ago, you’re probably going to have a hard time finding someone who regrets their decision. Why is that? The reason is tied to how home values grow with time and how, by extension, that grows your <a href="https://www.keepingcurrentmatters.com/2023/09/01/homeowners-have-a-lot-of-equity-right-now-infographic/" rel="noopener noreferrer" target="_blank">own wealth</a>. That may be why, in a recent Fannie Mae <a href="https://www.fanniemae.com/research-and-insights/perspectives/consumers-homeownership-aspirations-remain-high-despite-higher-home-prices-and-interest-rates" rel="noopener noreferrer" target="_blank">survey</a>, 76% of respondents say they believe buying a home is a safe investment.
Here’s a look at how just the home price appreciation piece can really add up over the years.
Home Price Growth over Time
The map below uses <a href="https://www.fhfa.gov/DataTools/Tools/Pages/House-Price-Index-(HPI).aspx" rel="noopener noreferrer" target="_blank">data</a> from the Federal Housing Finance Agency (FHFA) to show just how noteworthy price gains have been over the last five years. And, since <a href="https://www.keepingcurrentmatters.com/2023/09/26/the-return-of-normal-seasonality-for-home-price-appreciation/" rel="noopener noreferrer" target="_blank">home prices</a> vary by area, the map is broken out regionally to help convey larger market trends:
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20230928/20231002-Percent-Change-in-Home-Prices-over-5-years.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20230928/20231002-Percent-Change-in-Home-Prices-over-5-years.png" /></a>
If you look at the percent change in home prices, you can see home prices grew on average by just over 57% nationwide over a five-year period.
Some regions are slightly above or below that average, but overall, <a href="https://www.keepingcurrentmatters.com/2023/08/11/home-prices-are-back-on-the-rise-infographic/" rel="noopener noreferrer" target="_blank">home prices</a> gained solid ground in a short time. And if you expand that time frame even more, the benefit of homeownership and the drastic gains homeowners made over the years become even clearer (see map below):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20230928/20231002-Percent-Change-in-Home-Prices-since-91.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20230928/20231002-Percent-Change-in-Home-Prices-since-91.png" /></a>
The second map shows, nationwide, home prices appreciated by an average of over 297% over a roughly 30-year span.
This nationwide average tells you the typical homeowner who bought a house 30 years ago saw their home almost triple in value over that time. That’s a key factor in why so many homeowners who bought their homes years ago are still happy with their decision.
And while you may have heard talk throughout the year that <a href="https://www.keepingcurrentmatters.com/2023/09/08/home-price-forecasts-revised-for-2023-infographic/" rel="noopener noreferrer" target="_blank">home prices</a> would crash, it hasn’t happened. In fact, experts <a href="https://www.keepingcurrentmatters.com/2023/09/12/what-experts-project-for-home-prices-over-the-next-5-years/" rel="noopener noreferrer" target="_blank">project</a> home prices will continue to rise for years to come.
Bottom Line
If you’re wondering if it still makes sense to buy a home today, it's important to focus on the long-term advantages that come with homeownership. When you’re ready to start your homebuying journey, reach out to a local real estate professional.
2023-11-02T19:09:36-07:002023-11-02T19:13:03-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40146The Return of Normal Seasonality for Home Price Appreciation<a href="https://files.keepingcurrentmatters.com/content/images/20230921/20230926-The-Return-of-Normal-Seasonality-for-Home-Price-Appreciation.png" title="If you’re thinking of making a move, one of the biggest questions you have right now is probably: what’s happening with home prices? " class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20230921/20230926-The-Return-of-Normal-Seasonality-for-Home-Price-Appreciation.png" alt="The Return of Normal Seasonality for Home Price Appreciation" /></a>
If you’re thinking of <a href="https://www.keepingcurrentmatters.com/2023/08/14/where-are-people-moving-today-and-why/" rel="noopener noreferrer" target="_blank">making a move</a>, one of the biggest questions you have right now is probably: what’s happening with <a href="https://www.keepingcurrentmatters.com/2023/09/05/expert-home-price-forecasts-revised-up-for-2023/" rel="noopener noreferrer" target="_blank">home prices</a>? Despite what you may be hearing in the news, nationally, home prices aren’t falling. It’s just that <a href="https://www.keepingcurrentmatters.com/2023/09/12/what-experts-project-for-home-prices-over-the-next-5-years/" rel="noopener noreferrer" target="_blank">price growth</a> is beginning to normalize. Here’s the context you need to really understand that trend.
In the <a href="https://www.keepingcurrentmatters.com/2023/08/04/housing-market-forecast-for-the-rest-of-2023-infographic-1/" rel="noopener noreferrer" target="_blank">housing market</a>, there are predictable ebbs and flows that happen each year. It’s called seasonality. Spring is the peak homebuying season when the market is most active. That activity is typically still strong in the summer but begins to wane as the cooler months approach. Home prices follow along with seasonality because prices appreciate most when something is in <a href="https://www.keepingcurrentmatters.com/2023/09/15/plenty-of-buyers-are-still-active-today-infographic/" rel="noopener noreferrer" target="_blank">high demand</a>.
That’s why there’s a reliable long-term home price trend. The graph below uses data from <a href="https://www.spglobal.com/spdji/en/indices/indicators/sp-corelogic-case-shiller-us-national-home-price-nsa-index/#overview" rel="noopener noreferrer" target="_blank">Case-Shiller</a> to show typical monthly home price movement from 1973 through 2022 (not <a href="https://www.census.gov/construction/nrs/faqs/faqs_seas.html#quest2" rel="noopener noreferrer" target="_blank">adjusted</a>, so you can see the seasonality):
<a href="https://files.keepingcurrentmatters.com/content/branded/images/20230921/20230926-49-Year-Average-Monthly-Price-Movement.png" rel="noopener noreferrer" target="_blank" class="lightbox-added"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/branded/images/20230921/20230926-49-Year-Average-Monthly-Price-Movement.png" /></a>
As the data shows, at the beginning of the year, home prices grow, but not as much as they do in the spring and summer markets. That’s because the market is less active in January and February since fewer people move in the cooler months. As the market transitions into the peak homebuying season in the spring, activity ramps up, and home prices go up a lot more in response. Then, as fall and winter approach, activity eases again. Price growth slows, but still typically appreciates.
After several unusual <a href="https://www.keepingcurrentmatters.com/2023/05/30/todays-real-estate-market-the-unicorns-have-galloped-off/" rel="noopener noreferrer" target="_blank">‘unicorn’ years</a>, today’s higher <a href="https://www.keepingcurrentmatters.com/2023/09/06/mortgage-rates-past-present-and-possible-future/" rel="noopener noreferrer" target="_blank">mortgage rates</a> helped usher in the first signs of the return of seasonality. As Selma Hepp, Chief Economist at CoreLogic, <a href="https://www.corelogic.com/intelligence/us-home-price-insights-september-2023/" rel="noopener noreferrer" target="_blank">explains</a>:
“High mortgage rates have slowed additional price surges, with monthly increases returning to regular seasonal averages. In other words, home prices are still growing but are in line with historic seasonal expectations.”
Why This Is So Important to Understand
In the coming months, you’re going to see the media talk more about home prices. In their coverage, you’ll likely see industry terms like these:
Appreciation: when prices increase.
Deceleration of appreciation: when prices continue to appreciate, but at a slower or more moderate pace.
Depreciation: when prices decrease.
Don’t let the terminology confuse you or let any misleading headlines cause any unnecessary fear. The rapid pace of home price growth the market saw in recent years was unsustainable. It had to slow down at some point and that’s what we’re starting to see – deceleration of appreciation, not depreciation.
Remember, it’s normal to see home price growth slow down as the year goes on. And that definitely doesn’t mean home prices are falling. They’re just rising at a more moderate pace.
Bottom Line
While the headlines are generating fear and confusion on what’s happening with home prices, the truth is simple. Home price appreciation is returning to normal seasonality. If you have questions about what’s happening with prices in your local area, connect with a real estate professional.
2023-11-02T18:20:25-07:002023-11-02T18:23:27-07:00Billy Howelltag:homesoldflorida.com,2012-09-20:40145Beginning with Pre-Approval<a href="https://files.keepingcurrentmatters.com/content/images/20230921/20230925-The-Benefit-Of-Beginning-With-Pre-Approval.png" title="If you’re looking to buy a home this fall, there are a few things you need to know." class="lightbox-added"><img src="https://files.keepingcurrentmatters.com/content/images/20230921/20230925-The-Benefit-Of-Beginning-With-Pre-Approval.png" alt="Beginning with Pre-Approval" /></a>
If you’re looking to buy a home this fall, there are a few things you need to know. Affordability is tight with today’s <a href="https://www.keepingcurrentmatters.com/2023/06/07/the-main-reason-mortgage-rates-are-so-high/" rel="noopener noreferrer" target="_blank">mortgage rates</a> and rising <a href="https://www.keepingcurrentmatters.com/2023/09/08/home-price-forecasts-revised-for-2023-infographic/" rel="noopener noreferrer" target="_blank">home prices</a>. At the same time, there’s a <a href="https://www.keepingcurrentmatters.com/2023/09/14/why-is-housing-inventory-so-low/" rel="noopener noreferrer" target="_blank">limited number of homes</a> on the market right now and that’s creating some competition among buyers. But, if you’re strategic, there are ways to navigate these waters. The first thing you’ll want to do is get pre-approved for a mortgage. That way you’ll know your numbers and can set yourself up for success from the start of your home search.
What Pre-Approval Does for You
To understand why it’s such an important step, you need to know what pre-approval is. As part of the homebuying process, a lender looks at your finances to determine what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you know how much money you can borrow. Freddie Mac <a href="https://myhome.freddiemac.com/blog/homebuying/how-do-i-get-pre-approved-mortgage" rel="noopener noreferrer" target="_blank">explains</a> it like this:
“A pre-approval is an indication from your lender that they are willing to lend you a certain amount of money to buy your future home. . . . Keep in mind that the loan amount in the pre-approval letter is the lender’s maximum offer. Ultimately, you should only borrow an amount you are comfortable repaying.”
Basically, pre-approval gives you critical information about the homebuying process that’ll help you understand how much you may be able to borrow. Why does this help you, especially today? With higher <a href="https://www.keepingcurrentmatters.com/2023/09/06/mortgage-rates-past-present-and-possible-future/" rel="noopener noreferrer" target="_blank">mortgage rates</a> and <a href="https://www.keepingcurrentmatters.com/2023/08/11/home-prices-are-back-on-the-rise-infographic/" rel="noopener noreferrer" target="_blank">home prices</a> impacting affordability for many buyers right now, a solid understanding of your numbers is even more important so you can truly wrap your head around your options.
Pre-Approval Helps Show Sellers You’re a Serious Buyer
Let’s face it, there are more buyers looking to buy than there are homes available for sale and that imbalance is creating some competition among homebuyers. That means you could see yourself in a multiple-offer scenario when you make an offer on a home. But getting pre-approved for a mortgage can help you stand out from other hopeful buyers.
As an article from Wall Street Journal (WSJ) <a href="https://www.wsj.com/buyside/personal-finance/mortgage-pre-approval-25dd076c" rel="noopener noreferrer" target="_blank">says</a>:
“If you plan to use a mortgage for your home purchase, preapproval should be among the first steps in your search process. Not only can getting preapproved help you zero in on the right price range, but it can give you a leg up on other buyers, too.”
Pre-approval shows the seller you’re a serious buyer that’s already undergone a credit and financial check, making it more likely that the sale will move forward without unexpected delays or financial issues.
Bottom Line
Getting pre-approved is an important first step when you’re buying a home. The more prepared you are, the better chance you have of getting the home you want. Connect with a trusted lender so you have the tools you need to purchase a home in today’s market.
2023-11-02T18:16:44-07:002023-11-02T18:19:59-07:00Billy Howell