Homebuyer Tips for Finding the One [INFOGRAPHIC]

Some HighlightsThe best advice carries across multiple areas of life. When it comes to homebuying, a few simple tips can help you stay on track.Because of increased demand, you’ll need to be patient and embrace compromises during your search. Then, once you’ve fallen in love, commit by putting your best offer forward.If you’re looking to buy a home this year, let’s connect so you have a dedicated partner and teammate to help you find the one.Content previously posted on Keeping Current Matters

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What Do Past Years Tell Us About Today’s Real Estate Market?

As you follow the news, you’re likely seeing headlines discussing what’s going on in today’s housing market. Chances are high that some of the more recent storylines you’ve come across mention terms like cooling or slowing when talking about where the market is headed.But what do these terms mean? The housing market today is anything but normal, and it’s still an incredibly strong sellers’ market, especially when compared to the few years leading up to the pandemic. With that in mind, what can previous years tell us about today’s real estate market and if it’s truly slowing?We’re Still Seeing an Above Average Number of SalesYou may see headlines about a drop in home sales. But are those headlines telling the full story? The most recent Existing Home Sales Report from the National Association of Realtors (NAR) does show a drop of about 2% from July to August. But the month-over-month decline doesn’t provide the full picture (see graph below):As the graph shows, historical context is key. Today’s home sales are well ahead of some of the more normal years that led up to the health crisis. That means buyers are still in the market, which is great news if you’re planning to list your home.Houses Are Selling Faster Than UsualWhen headlines mention the market is slowing, sellers may naturally wonder if their house will sell as quickly as they’d like. According to the most recent Realtors Confidence Index from NAR, homes are still selling at record speed (see graph below):Again, if we look back at data from previous years, we can see the average time on market – 17 days –  means homes are selling faster than a normal pace. Bidding Wars Are Still the NormThe Realtors Confidence Index from NAR also shows a drop in the average number of offers homes are receiving in August, and many headlines may simply focus there without providing the important context (see graph below):Again, it’s important to compare today’s market to trends from recent years. Currently, the average number of offers per listing is higher than 39 of the previous 45 months. That means the likelihood of a bidding war on your home is still high. And the number of offers your house receives can have a major influence on the final sale price.So, Is the Market Slowing Down?While there are slight declines in various month-to-month data, it’s important to keep historical context in mind when determining what’s happening in today’s market. Odeta Kushi, Deputy Chief Economist at First American, put it best recently, saying:“It’s not the white-hot market from earlier in the year & it’s not the 2020 market benefiting from a wave of pent-up demand but make no mistake this is still a hot housing market.”Bottom LineDon’t let headlines make you rethink listing your home this fall. Selling today means you can still take advantage of high buyer demand, multiple offers, and a quick sale. If you’re thinking of selling your house, let’s connect and discuss why this fall is the perfect time to do so.Content previously posted on Keeping Current Matters

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The Big Question: Should You Renovate or Move?

The last 18 months changed what many buyers are looking for in a home. Recently, the American Institute of Architects released their AIA Home Design Trends Survey results for Q3 2021. The survey reveals the following:70% of respondents want more outdoor living space69% of respondents want a home office (48% wanted multiple offices)46% of respondents want a multi-function room/flexible space42% of respondents want an au pair/in-law suite39% of respondents want an exercise room/yoga spaceIf you’re a homeowner who wants to add any of the above, you have two options: renovate your current house or buy a home that already has the spaces you desire. The decision you make could be determined by factors like:A possible desire to relocateThe difference in the cost of a renovation versus a purchaseFinding an existing home or designing a new home that has exactly what you want (versus trying to restructure the layout of your current house)In either case, you’ll need access to capital: the funds for the renovation or the down payment your next home would require. The great news is that the money you need probably already exists in your current home in the form of equity.Home Equity Is SkyrocketingThe record-setting increases in home prices over the last two years dramatically improved homeowners’ equity. The graph below uses data from CoreLogic to show the average home equity gain in the first quarter of the last nine years:Odeta Kushi, Deputy Chief Economist at First American, quantifies the amount of equity homeowners gained recently:“Remember U.S. households own nearly $35 trillion in owner-occupied real estate, just over $11 trillion in debt, and the remaining ~$24 trillion in equity. In inflation adjusted terms, homeowners in Q2 had an average of $280,000 in equity- a historic high.”As a homeowner, the money you need to purchase the perfect home or renovate your current house may be right at your fingertips. However, waiting to make your decision may increase the cost of tapping that equity.If you decide to renovate, you’ll need to refinance (or take out an equity loan) to access the equity. If you decide to move instead and use your equity as a down payment, you’ll still need to mortgage the remaining difference between the down payment and the cost of your next home.Mortgage rates are forecast to increase over the next year. Waiting to leverage your equity will probably mean you’ll pay more to do so. According to the latest data from the Federal Housing Finance Agency (FHFA), almost 57% of current mortgage holders have a mortgage rate of 4% or below. If you’re one of those homeowners, you can keep your mortgage rate under 4% by doing it now. If you’re one of the 43% of homeowners with a mortgage rate over 4%, you may be able to do a cash-out refinance or buy a more expensive home without significantly increasing your monthly payment.First Step: Determine the Amount of Equity in Your Home If you’re ready to either redesign your current house or find an existing or newly constructed home that has everything you want, the first thing you need to do is determine how much equity you have in your current home. To do that, you’ll need two things:The current mortgage balance on your homeThe current value of your homeYou can probably find the mortgage balance on your monthly mortgage statement. To find the current market value of your house, you can pay several hundreds of dollars for an appraisal, or you can contact a local real estate professional who will be able to present to you, at no charge, a professional equity assessment report.Bottom LineIf the past 18 months have refocused your thoughts on what you want from your house, now may be the time to either renovate or make a move to the perfect home.Content previously posted on Keeping Current Matters

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