Should I Buy Now? Or Wait Until Next Year? [INFOGRAPHIC]

Some Highlights:

  • The cost of waiting to buy is defined as the additional funds it would take to buy a home if prices & interest rates were to increase over a period of time.
  • Freddie Mac predicts interest rates to rise to 5.2% by the third quarter of 2019.
  • CoreLogic predicts home prices to appreciate by 5.1% over the next 12 months.
  • If you are ready and willing to buy your dream home, find out if you are able to!

Posted by The KCM Crew

 

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Where Are Mortgage Interest Rates Headed In 2019?

The interest rate you pay on your home mortgage has a direct impact on your monthly payment; the higher the rate, the greater the payment will be. That is why it is important to know where rates are headed when deciding to start your home search.

Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next year.

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.2% from this time last year and are predicted to be 5.1% higher next year.

If both the predictions of home price and interest rate increases become a reality, families would wind up paying considerably more for their next homes.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth, so don’t wait until next year! Let’s get together to evaluate your ability to purchase your dream home now.

 

Posted by The KCM Crew

Start looking for your next home today! Click HERE

The Perks of Buying a Home in the Fall

Editor’s Note: This post was originally published on September 16, 2015. Housecall continues to share this piece due to ongoing requests and reader interest.

As we close out a summer marked by rising home prices and limited supply, we’re conditioned to expect the inevitable end-of-season slowdown. But the change of season doesn’t mean activity drops off completely – in fact, fall’s arrival presents opportunities for homebuyers, in part due to a “back-to-school mentality,” according to a survey by ERA Real Estate.

If you’re a prospective homebuyer, tap into that renewed sense of motivation – and consider the following perks – while hunting for a home this fall.

You can enjoy year-end tax breaks. Buying before the year’s out allows fall homebuyers to take advantage of tax breaks such as the mortgage interest and property tax deductions. “There are certain deductions that can be claimed by homeowners only,” explains 1040Return.com Founder John Gregory. “If you have taken out a homeowner’s loan, consider these deductions as Uncle Sam’s gift to you.” To learn more about the tax benefits available to homeowners, click here.

You can sidestep the multiple-bid minefield. Bidding wars dominated low inventory markets this summer, but competition tends to wane as activity slows in the fall. With fewer folks searching for homes, fall homebuyers can spend less time chasing supply and more time finding – and getting – the perfect home.

You may have more bargaining power. Aside from less competition, fall homebuyers may have the opportunity to purchase their home of choice at a reduced price, especially when negotiating with sellers who had hoped to unload their homes over the summer.

Related Link: If Your Home Didn’t Sell This Summer, Don’t Despair – Fall and Winter Are Great Times to Sell, Too

You’ll be home for the holidays – literally. As ERA reports in their survey, fall homebuying activity is also fueled by emotional motivation. “As vacations wind down after Labor Day and people become more focused, the desire to be in a new home for the holidays is a historically strong driver of fall home sales,” says ERA President and CEO Charlie Young.

 

Posted by Suzanne De Vita on RISMedia’s House Call

Ready to buy your next home? Click HERE to get started!

Rent or Buy: Either Way You’re Paying A Mortgage!

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

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

With home prices rising, many renters are concerned about their house-buying power. Mark Fleming, Chief Economist at First Americanexplained:

Over the last three years, renter house-buying power has increased fast enough to keep pace with house price appreciation, so the share of homes that a renter can afford to buy has remained the same since 2015.

Although mortgage rates are expected to rise, they are still low by historic standards, and real household incomes are the highest they have ever been. Assuming this trend continues, our measure of affordability, which takes into account income, interest rates, and house prices, indicates thathomeownership is still within reach for renters.”

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

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.51% last week.

Bottom Line

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

 

Posted by The KCM Crew

Buying a House? 6 Questions You’d Never Think to Ask, but Should

zhudifeng/iStock

When buying a house is high on your priority list and you spot The One—the house that has everything you’ve ever dreamed of and more—it can be tempting to put pedal to the metal and close the deal as quickly as possible. But slow down!

No home is perfect beneath the surface, and few know this better than your real estate agent. And that means it’s time to sit down with this professional and pepper him with questions about the place you’re hoping to make your own.

And while certain questions seem rather obvious—should you offer full price, how soon can you close—there are many others you may not think to ask an agent at this pivotal juncture. But you should!

Here are six questions to ask a real estate agent to flush out what he’s truly thinking, that could help you figure out if this place is really right for you.

1. ‘Would you buy this house?’

This question may be the ultimate litmus test of whether you should purchase a home. If your agent would have reservations about buying the house for himself, that’s a waving red flag. So if you get the sense your agent isn’t as enthusiastic about the home as you are, ask why. His answer might give you pause, too.

2. ‘What is the sales history of this house, and how would it affect my offer?’

Before making an offer on a house, ask your agent for the property’s sales history, says Chris Dossman, a real estate agent with Century 21 Scheetz in Indianapolis.

Was it previously an expired listing? Was it leased? Was it ever a bank-owned property or other type of distressed home? These factors could suggest a home has been a struggle to sell—which could mean you could snap up this home at a bargain-basement price.

3. ‘What contingencies do you think are worth getting—and skipping?’

“When buyers and sellers get cold feet about the purchase or sale of a home, they sometimes think they can just back out,” says Linda Sanderfoot, a real estate agent at Coldwell Banker in Neenah, WI. But when a seller accepts a buyer’s offer, both parties sign a legal and binding contract—an official document that requires the buyer and seller to execute the transaction.

So how binding that contract is depends on the details. Some contracts have contingencies built in that enable the buyer or seller to walk away from the deal without penalty. And contingencies are often included for a home inspection and an appraisal.

But note that having too many contingencies tends to turn off sellers, so make sure to strike the right balance by asking your real estate agent for guidance. For instance, you might be OK waiving a home inspection contingency if the home is newly constructed, whereas it’s more essential with an older home that might need extensive repairs.

4. ‘Are there any upcoming condo or homeowners association assessments?’

When you purchase a condominium or a home within a homeowners association, you’ll receive the HOA’s financial documents, which outline important information such as reserve funds and CC&Rs (covenants, conditions, and restrictions).

These condo docs and disclosures can be hundreds of pages long—which could overwhelm home buyers, who could forget to check if there are any upcoming assessments. Assessments are periodic one-time payments made to the HOA above and beyond the monthly fee, usually to cover capital improvements or repairs. Since they will affect your monthly housing expenses, you’ll want to know whether they could go up anytime soon—and your agent is adept at navigating these documents to pinpoint the answer.

5. ‘What’s happening in this neighborhood, and how will that affect home prices?’

Good real estate agents hear everything about what’s happening in the communities where they do business. And although federal fair housing laws prohibit real estate agents from commenting on a neighborhood’s demographics, your agent can still give you advice on whether you’re making a solid investment based on local housing market trends and economic factors that affect home values.

So go ahead and ask: Are the neighborhood’s home prices rising or falling? Are there new amenities (e.g., parks, shopping, public transportation, Whole Foods) being built in the area?

These are all important things to consider before buying a house, and a real estate agent can help you cut through the noise and really tell you what’s up.

6. ‘Can you recommend a home inspector/handyman/real estate attorney in the area?’

Local expertise matters not only with the real estate agent you hire, but also the other professionals you could meet while negotiating this real estate deal. So if you need recommendations for a home inspector, handyman, real estate attorney, or anyone else on your home-buying journey, make sure to ask your agent for recommendations to boost the odds of smooth sailing.

 

Posted by Daniel Bortz on realtor.com

Are you ready to buy your next home? Click HERE to get started!

The Net Worth of a Homeowner is 44x Greater Than A Renter!

Every three years, the Federal Reserve conducts their Survey of Consumer Finances in which they collect data across all economic and social groups. Their latest survey data, covering 2013-2016 was recently released.

The study revealed that the median net worth of a homeowner was $231,400 – a 15% increase since 2013. At the same time, the median net worth of renters decreased by 5% ($5,200 today compared to $5,500 in 2013).

These numbers reveal that the net worth of a homeowner is over 44 times greater than that of a renter.

Owning a home is a great way to build family wealth

As we’ve said before, simply put, homeownership is a form of ‘forced savings.’ Every time you pay your mortgage, you are contributing to your net worth by increasing the equity in your home.

That is why, for the fifth year in a row, Gallup reported that Americans picked real estate as the best long-term investment. This year’s results showed that 34% of Americans chose real estate, followed by stocks at 26% and then gold, savings accounts/CDs, or bonds.

Greater equity in your home gives you options

If you want to find out how you can use the increased equity in your home to move to a home that better fits your current lifestyle, let’s get together to discuss the process.

 

Posted by The KCM Crew

Ready to find your next home? Click HERE to get started!

Will Your Current House Fit Your Needs in Retirement?

As more and more baby boomers enter retirement age, the question of whether or not to sell their homes and move will become a hot topic. In today’s housing market climate, with low available inventory in the starter and trade-up home categories, it makes sense to evaluate your home’s ability to adapt to your needs in retirement.

According to the National Association of Exclusive Buyers Agents (NAEBA), there are 7 factors that you should consider when choosing your retirement home.1

1. Affordability

“It may be easy enough to afford your home today but think long-term about your monthly costs. Account for property taxes, insurance, HOA fees, utilities – all the things that will be due whether or not you have a mortgage on the property.”

Would moving to a complex with homeowner association (HOA) fees actually be cheaper than having to hire all the contractors you would need to maintain your home, lawn, etc.? Would your taxes go down significantly if you relocated? What is your monthly income going to be like in retirement?

2. Equity

“If you have equity in your current home, you may be able to apply it to the purchase of your next home. Maintaining a healthy amount of home equity gives you a source of emergency funds to tap, via a home equity loan or reverse mortgage.”

The equity you have in your current home may be enough to purchase your retirement home with little to no mortgage. Homeowners in the US gained an average of over $16,300 in equity last year.

3. Maintenance

“As we age, our tolerance for cleaning gutters, raking leaves and shoveling snow can go right out the window. A condominium with low-maintenance needs can be a literal lifesaver, if your health or physical abilities decline.”

As we mentioned earlier, would a condo with an HOA fee be worth the added peace of mind in knowing that you do not have to do the maintenance work yourself?

4. Security

“Elderly homeowners can be targets for scams or break-ins. Living in a home with security features, such as a manned gate house, resident-only access and a security system can bring peace of mind.”

As scary as that thought may be, any additional security and an extra set of eyes looking out for you always adds to peace of mind.

5. Pets

“Renting won’t do if the dog can’t come too! The companionship of pets can provide emotional and physical benefits.”

Evaluate all of your options when it comes to bringing your ‘furever’ friend with you to a new home. Will there be necessary additional deposits if you are renting or moving in to a condo? Is the backyard fenced in? How far are you from your favorite veterinarian?

6. Mobility

“No one wants to picture themselves in a wheelchair or a walker, but the home layout must be able to accommodate limited mobility.”

Sixty is the new 40, right? People are living longer and are more active in retirement, but that doesn’t mean that down the road you won’t need your home to be more accessible. Having to install handrails and make sure that your hallways and doorways are wide enough may be a good reason to look for a home that was built to accommodate these needs.

7. Convenience

“Is the new home close to the golf course, or to shopping and dining? Do you have amenities within easy walking distance? This can add to home value!”

How close are you to your children and grandchildren? Would relocating to a new area make visits with family easier or more frequent? Beyond being close to your favorite stores and restaurants, there are a lot of factors to consider.

Bottom Line

When it comes to your forever home, evaluating your current house for its ability to adapt with you as you age can be the first step to guaranteeing your comfort in retirement. If after considering all these factors you find yourself curious about your options, let’s get together to evaluate your ability to sell your house in today’s market and get you into your dream retirement home!

 

Posted by The KCM Crew

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