Hope Leitner, Realtor®, CRS

One of the first steps in a good outcome is knowing a little bit about what you're about to undertake.   By being aware of some of the areas regarding homes that may not come up every year in a tax return, you'll be able to point them out to your tax professional or seek more information from IRS.gov. Look through this list of items for things that could affect your tax return.   Even if you have relied on the same tax professional for years to look out for your best interests, they need to be aware that there could be something different in this year's return. If you bought a home for a principal residence last year, check your closing statement and identify any points or pre-paid interest that you or the seller paid based on the mortgage you received.   These can be deducted on your Schedule A as qualified home interest if you itemize your deductions.   See Home Mortgage Interest Deduction | IRS Publication 936 (2018 version not released as of this newsletter) . K

One of the most common loans you can get to buy a home is a 30-year fixed rate mortgage. If the thought of paying for your home over the course of 30-years seems daunting, here are some easy ways to shorten that term which will actually end up saving you money over the life of your loan. Any additional payments to the principal amount (the original sum of money borrowed in a loan), helps to cut down the amount of interest that you will pay over the life of your loan and can also help to shave years off the loan as well. When you make ‘extra’ payments toward your loan, the key is to let your lender/bank know that you want the extra funds to go toward your principal balance as they will not automatically do this for you. You don’t have to double your mortgage payment to make a big difference either! If you have a 30-year mortgage on a median-priced home ($250,000) with a 5% interest rate, you’ll be responsible for a $1,342.05 monthly principal and interest payment. Over the course

There is a lot of uncertainty regarding the real estate market heading into 2019. That uncertainty has raised concerns that we may be headed toward another housing crash like the one we experienced a decade ago. Here are four reasons why today’s market is much different: 1. There are fewer foreclosures now than there were in 2006 A major challenge in 2006 was the number of foreclosures. There will always be foreclosures, but they spiked by over 100% prior to the crash. Foreclosures sold at a discount and, in many cases, lowered the values of adjacent homes. We are ending 2018 with foreclosures at historic pre-crash numbers – much 2. Most homeowners have tremendous equity in their homes Ten years ago, many homeowners irrationally converted much, if not all, of their equity into cash with a cash-out refinance. When foreclosures rose and prices fell, they found themselves in a negative equity situation where their homes were worth less than their mortgage amounts. Many just wa

We frequently talk about why it makes sense to buy a home financially, but more often than not the emotional reasons are the more powerful or compelling ones. No matter what shape or size your living space is, the concept and feeling of a home can mean different things to different people. Whether it’s a certain scent or a favorite chair, the emotional reasons why we choose to buy our own homes are typically more important to us than the financial ones. 1. Owning your home offers stability to start and raise a family From the best neighborhoods to the best school districts, even those without children at the time of purchase may have this in the back of their minds as a major reason for choosing the location of the home that they purchase. 2. There’s no place like home Owning your own home offers you not only safety and security, but also a comfortable place that allows you to relax after a long day! 3. You have more space for you and your family Whether your family is expa

Some Highlights: •Existing home sales are currently at an annual pace of 5.32 million and have increased on a monthly basis for the last two months. •The inventory of existing homes for sale remains below the 6-months needed for a normal market and is now at a 3.9-month supply. •Inventory remains low due to high demand from buyers who are still looking for houses to buy!

Being a better homeowner is a full-time job.   It's not just about making better decisions when you buy and sell; it's making better decisions throughout the time you own the home. It takes good information to make good decisions.   Think of times when you need advice on financing, taxes, insurance, maintenance, finding reasonable and reliable contractors and lots of other things.   Imagine how nice it would be to have a real estate information line you could call whenever you have a question. During the purchase or sale, the obvious place to get real estate answers is your agent but where do you go the rest of the time? Since homeowners are now staying in their homes for ten to twelve years or more, they need a reliable resource for good information and advice. Our objective is to move from a single purchase or sale to customers for life; a select group of our friends and past customers who consider us their lifelong real estate professional.     We believe that if we he

Here are five reasons listing your home for sale this winter makes sense. 1. Demand Is Strong The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now! More often than not, multiple buyers are competing with each other to buy a home. Take advantage of the buyer activity currently in the market. 2. There Is Less Competition Now Housing inventory is still under the 6-month supply that is needed for a normal housing market. This means that, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in the market. This is good news for homeowners who have gained equity as their home values have increased. However, additional inventory could be coming to the market soon. Historically, the average number of years a homeowner stayed in their home was si

Smart home technology promises to make your home more comfortable, convenient and secure.  It may not be the home from the Jetson's but artificial intelligence is the hope to make it the home of the future which is available now and controlled from anywhere you have an Internet connection. When Alexa appeared at Christmas-time two years ago, most people thought it was a novelty to ask what the weather will be or to play a song.  Few people understood the vision of Amazon would be verbally purchasing everything imaginable and that your calendar, contacts, lights, and appliances would all be connected. There are plenty of players in the market including Amazon Alexa, Google Assistant, Samsung Smart Things, Apple and others.  It starts with a hub that acts like a brain for your system to connect the different home automation devices.  You'll establish an online account with the hub manufacturer so that you can adjust settings and controls. You could start simple with switch

Price, condition and terms are factors that any owner must consider when marketing their home.   Price is usually the easiest to adjust to compensate for shortcomings in location or condition of the home.   Improving the condition of the property is more time consuming but updates to kitchens, baths and other things can appeal to a buyer. One of the most overlooked marketing factors are terms which are also referred to as financing concessions. Paying part or all a buyer's closing costs is the most common financing concession.   By doing so, the buyer doesn't need as much cash to get into the home which can be attractive to more buyers. There is another financing concession that is not used very often in today's market but it is still allowed and can increase the marketability of a home. A temporary buy-down of the interest rate makes a lower payment for an initial period. It is still a fixed-rate mortgage that the buyer must qualify for at the note rate and there i

The Federal Reserve Board's Triennial Survey of Consumer Finances recently revealed the net worth of a homeowner was $231,400 compared to $5,200 for a renter.   The net worth of homeowners increased 15% from 2013 to 2016 while renters' decreased by 5%. Appreciation and principal reduction are the two dynamics that affect a homeowner's equity.   Each payment is applied to the interest for the previous month and the principal reduction to retire the mortgage. A $300,000 home purchased with a $294,566 FHA mortgage at 5% for 30 years has an average monthly principal reduction $362 in the first year. Two percent appreciation would benefit the buyer by $500 a month.   In this example, the equity grows by $860 a month for the homeowner.   A tenant would have to invest $660 a month over and above the rent they're paying. Based on the assumptions listed above, the $10,500 down payment would become approximately $85,000 of equity in seven years. Leverage and forced savings

There is a little-known mortgage program that could provide the vehicle for the right person to get into a home.   If a person sells their home to another for less than the fair market value, the difference in the appraised value and the sales price is considered a gift of equity for the buyer. FHA requires that borrowers receive gifts of equity only from family members transferring title to the borrower.   An appraisal is required to determine the value of the home.   The sales price is subtracted from the appraised value to determine the equity to be gifted.   If a home appraises for $300,000 when the owner will sell it for $250,000, the gift is $50,000. The gift is applied to the down payment.   In this example, the borrower would have to qualify for a $250,000 mortgage which would require private mortgage insurance because a 20% down payment on a $300,000 home would be $60,000.   If the buyer had an additional $10,000 in cash to put down, the PMI would not be required, and th

It may be natural for first-time buyers to be unsure of the process of buying a home because they haven't been through it before but even repeat buyers need to know changes that have taken place since the financial housing crisis. The steps in the home buying process are predictable and generally follow the same pattern.   It certainly makes the move stay on schedule when you know all the different things that must be done to get to the closing. In the initial interview with your real estate professional, you share the things you want and need in a home, discuss available financing and learn how your agent can represent you in the transaction. The pre-approval step is essential for anyone using a mortgage to purchase a home to assure that they're looking at the right price of homes and so they'll know what they can qualify for and what the interest will be. Even with lower than normal inventory, it is difficult to stay up-to-date with the homes current

It's been said that if you can find a home that has most of what you want, you should go ahead and purchase it.   Many first-time buyers are using everything they have for a down payment and closing costs and would have to "live" with the less than perfect home until they can save the money to make the changes. The FHA 203(k) mortgage allows a borrower to purchase a home and provides additional funds for improvements to be made.   These types of renovations can include kitchen and bathroom remodels, flooring, plumbing, heating and air conditioning systems, additions and other things. The benefit to the buyer is that they have the opportunity to consider a home that needs repairs and might have been unacceptable without a program like this.   Being a FHA loan, a minimal down payment is required, fair interest rates and generous qualifying requirements. The 203(k) Streamline can be used for cosmetic improvements, appliances and minor remodeling up to $35,000 in cost.

Recently, multiple headlines have been written asserting that homeownership is less affordable today than at any other time in the last decade. Though the headlines are accurate, they lack context and lead too many Americans to believe that they can’t partake in a major part of the American Dream – owning a home . In 2008, the housing market crashed and home values fell by as much as 60% in certain markets. This was the major trigger to the Great Recession we experienced from 2008 to 2010. To come back from that recession, mortgage interest rates were pushed down to levels that were never seen before. For the last ten years, you could purchase a home at a dramatically discounted price and attain a mortgage at a historically low mortgage rate. Affordability skyrocketed. Now that home values have returned to where they should be, and mortgage rates are beginning to increase, it is less affordable to own a home than it was over the last ten years. However, what is not being report

Some Highlights: •The Veterans Administration (VA) Home Loan is a benefit that is available to more than 22 million veterans & 2 million active duty service members which helps them achieve their dreams of homeownership. •In 2017, $189 billion was loaned to veterans and their families through the program. •VA Purchase Loans are on the rise in 46 out of 50 states and Washington, DC.

Urban Institute recently released a report entitled, “Barriers to Accessing Homeownership: Down Payment, Credit, and Affordability,” which revealed that, “Consumers often think they need to put more money down to purchase a home than is actually required. In a 2017 survey, 68% of renters cited saving for a down payment as an obstacle to homeownership. Thirty-nine percent of renters believe that more than 20% is needed for a down payment and many renters are unaware of low–down payment programs.” Myth #1: “I Need a 20% Down Payment” Buyers often overestimate the down payment funds needed to qualify for a home loan. According to the same report: “Most potential homebuyers are largely unaware that there are low-down payment and no-down payment assistance programs available at the local, state, and federal levels to help eligible borrowers secure an affordable down payment.” These numbers do not differ much between non-owners and homeowners. For example, “30% of homeowners and 3

Finding the right home is still the biggest challenge buyers are faced with in today's market as is shown in the latest Confidence Index Survey.   Assuming the buyers find the "right" home with determination, perseverance and the help of a real estate professional, 88% of all transactions last year required financing to get the buyer's address on the home.   93% of first-time buyers needed financing. Pre-approval is an essential step that needs to be handled before buyers begin searching for a home.   The benefits to the buyer fall into the category of confidence. PRE-APPROVAL GIVES YOU CONFIDENCE Knowing the amount you can borrow   the mortgage amount decreases as interest rates rise Looking at the right priced homes price, size, amenities, location Comparing and identifying the best loan rate, term, type Uncover issues early that could affect the most favorable loan terms time to cure possible problems Barg

Every Hour in the US Housing Market: •596 Homes Sell •278 Homes Regain Positive Equity Median Home Values Go Up $1.20

There are many questions about where home sales are headed next year. We have gathered the most reliable sources to help answer this question. Here are our sources: Mortgage Bankers Association (MBA) – As the leading advocate for the real estate finance industry, the MBA enables members to successfully deliver fair, sustainable, and responsible real estate financing within ever-changing business environments. The National Association of Realtors (NAR) – The largest association of real estate professionals in the world. Freddie Mac – An organization which provides liquidity, stability, and affordability to the U.S. housing market in all economic conditions extending to all communities from coast to coast. Fannie Mae – A leading source of financing for mortgage lenders, providing access to affordable mortgage financing in all markets. Here are their projections: Bottom Line Every source sees home sales growing next year. Let’s get together to chat about what’s going on i

A considerable number of potential buyers shy away from jumping into the real estate market due to their uncertainties about the buying process. A specific cause for concern tends to be mortgage qualification. For many, the mortgage process can be scary, but it doesn’t have to be! In order to qualify in today’s market, you’ll need a down payment (the average down payment on all loans last year was 5%, with many buyers putting down 3% or less), a stable income, and good credit history. Throughout the entire home buying process, you will interact with many different professionals who will all perform necessary roles. These professionals are also valuable resources for you. Once you’re ready to apply, here are 5 easy steps that Freddie Mac suggests to follow: 1.Find out your current credit history & score – even if you don’t have perfect credit, you may already qualify for a loan. The average FICO Score® of all closed loans in September was 731, according to Ellie Mae . 2.

Chances are if you are renting you are spending too much of your income on your monthly housing expense. There is a long-standing ‘rule’ that a household should not pay more than 28% of their income on their rent or mortgage payment. This percentage allows the household to save money for the future while comfortably covering other expenses. According to new data released from ApartmentList.com , 49.5 million renters in the United States were cost-burdened in 2017, meaning they spent more than 30% of their monthly incomes on rent. This accounts for nearly half of all renter households in the country and is up 3.1 million from 2007. When a household is cost-burdened by their monthly housing expense, they are not as easily able to save money for the future. This is a big factor for many renters who dream of owning their own homes someday. But there is hope for those who are able to save at least a 3% down payment! The percentage of income needed in the US to buy a home is significa

With home prices on the rise and buyer demand still strong, some sellers may be tempted to try and sell their homes on their own without using the services of a real estate professional. Real estate agents are trained and experienced in negotiation and, in most cases, the seller is not. Sellers must realize that their ability to negotiate will determine whether or not they get the best deal for themselves and their families. Here is a list of just some of the people with whom the seller must be prepared to negotiate with if they decide to For Sale by Owner (FSBO): •The buyer who wants the best deal possible •The buyer’s agent who solely represents the best interests of the buyer •The buyer’s attorney (in some parts of the country) •The home inspection companies, which work for the buyer and will almost always find some problems with the house •The termite company if there are challenges •The buyer’s lender if the structure of the mortgage requires the sellers’ participation

As storybooks go, the character is introduced, they meet their love interest, a villain thwarts their intentions, true love overcomes, they marry and live happily ever-after.   It's a very familiar formula. Similarly, there is a formula that couples follow in real life.   They go to college, get a good job, rent a home, fall in love, get married and buy a starter home.   They start a family, move into a larger home, save for their children's education, start planning for their retirement and if they live within their means, they invest their surplus funds. An alternative to this might be to start investing in rental homes early in their adult life before their standard of living becomes so expensive that they don't feel like they have the money to purchase rentals.   There are infinite possibilities but let's say a single person, after getting a good job, buys a small three or four-bedroom home with an owner-occupied, minimum down payment.   They move into the hom

There are many questions about where home prices will be next year as well as where they may be headed over the next several years to come. We have gathered the most reliable sources to help answer these questions: The Home Price Expectation Survey – A survey of over 100 market analysts, real estate experts, and economists conducted by Pulsenomics each quarter. Zelman & Associates – The firm leverages unparalleled housing market expertise, extensive surveys of industry executives, and rigorous financial analysis to deliver proprietary research and advice to leading global institutional investors and senior-level company executives. Mortgage Bankers Association (MBA) – As the leading advocate for the real estate finance industry, the MBA enables members to successfully deliver fair, sustainable, and responsible real estate financing within ever-changing business environments. Freddie Mac – An organization whose mission is to provide liquidity, stability, and affordability

According to a new study from Urban Institute , there are over 19 million millennials in 31 cities who are not only ready and willing to become homeowners, but are able to as well! Now that the largest generation since baby boomers has aged into prime homebuying age, there will no doubt be an uptick in the national homeownership rate. The study from Urban Institute revealed that nearly a quarter of this generation has the credit and income needed to purchase a home. Surprisingly, the largest share of mortgage-ready millennials lives in expensive coastal cities. These cities often attract highly skilled workers who demand higher salaries for their expertise. So, what’s holding these mortgage-ready millennials back from buying? Myths About Down Payment Requirements! Most of the millennials surveyed for the study believe that they need at least a 15% down payment in order to buy a home when, in reality, the median down payment in the US in 2017 was just 5%, and many programs are a

There are many unsubstantiated theories about what is happening with home prices. From those who are worried that prices are falling (data shows this is untrue) , to those who are concerned that prices are again approaching boom peaks because of “irrational exuberance” (this is also untrue as prices are not at peak levels when they are adjusted for inflation), there seems to be no shortage of opinion. However, the increase in prices is easily explained by the theory of supply & demand . Whenever there is a limited supply of an item that is in high demand, prices increase. It is that simple. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In most housing markets, anything less than six months will cause home values to appreciate and anything greater than seven months will cause prices to depreciate (see chart below) . According to the Existing Home Sales Report from the National Association of Realtors (NAR), the mont

When the standard deduction for married couples filing jointly was increased from $12,700 to $24,000 for 2018, there was some speculation that the bloom was off the rose of homeownership.   The thought was that if the tax benefits from being able to deduct the property taxes and interest was less than the standard deduction, that maybe, the buyer would be better off continuing to rent. With mortgage rates as low as they have been for the past eight years, payments have been lower and so has the amount interest that was paid.   This and the fact that sales and local taxes, which include property taxes, are limited to $10,000 a year on the Itemized Deduction form have made it harder to reach the increased standard deduction. The reality of the situation is tax benefits are only one of the components that make a home an excellent investment and it probably contributes the least of the top three benefits.   Principal reduction and appreciation build an owner's equity in an automati

Some Highlights: •When listing your house for sale, your top goal will be to get the home sold for the best price possible! •There are many small projects that you can do to ensure this happens! •Your real estate agent will have a list of specific suggestions for getting your house ready for market and is a great resource for finding local contractors who can help!

In today’s real estate market, with low inventory dominating the conversation in many areas of the country, it can often be frustrating to be a first-time homebuyer if you aren’t prepared. In a recent realtor.com article entitled, “How to Find Your Dream Home—Without Losing Your Mind,” the author highlights some steps that first-time homebuyers can take to help carry their excitement of buying a home throughout the whole process. 1. Get Pre-Approved for a Mortgage Before You Start Your Search One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search. Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing whether or not your dream home is within your reach. This step will also help you narrow your search based on your budget and won’t leave you disappointed if the home you tour, and love, ends up being outside your budget! 2. Kn

For a while now baby boomers have been blamed for a portion of the housing market’s current lack of housing inventory, but should they really be getting the blame? Here’s what some of the experts have to say on the subject: Aaron Terrazas, Senior Economist at Zillow, says that “Boomers are healthier and working longer than previous generations, which means they aren’t yet ready to sell their homes.” According to a study by Realtor.com, 85% of baby boomers indicated they were not planning to sell their homes. It is true that baby boomers are healthier and are thus working and living longer, but are they also refusing to sell their homes? Last month, Trulia looked at the housing situation of seniors (aged 65+) today compared to that of a decade ago. Trulia’s study revealed that: “Although seniors appear to be delaying downsizing until later in life, as a group, households 65 and over are still downsizing at roughly the same rate as in years past.” Trulia also explains that,

  In September, the Federal Reserve raised interest rates for the third time in 2018 and they're expected to go up one more time this year and three times next year.   If you have a Home Equity Line of Credit, HELOC, you're paying more to use that money and it is going to become more expensive. It may make sense to refinance your home and consolidate the balance of your HELOC to lock in a lower mortgage rate.   Most lenders require that the combination of these loans should not exceed 80% of the home's fair market value and that you have good credit and adequate income to support the payment. A HELOC is a first or second mortgage that allows the borrower to withdraw money as needed, up to the line of credit provided by the lender.   A draw period is established where the borrower is only required to pay interest.   Since all HELOC loans are variable rate mortgages, during periods of rising rates, the cost of the funds increase.   However, unlike adjustable rate mortg

Some Highlights: •Buying a home can be intimidating if you are not familiar with the terms used during the process. •To start you on your path with confidence, we have compiled a list of some of the most common terms used when buying a home. •The best way to ensure that your home-buying process is a confident one is to find a real estate professional who not only puts your family’s needs first, but will guide you through every aspect of the transaction with ‘the heart of a teacher.’

According to CoreLogic’s latest Home Price Insights Report, national home prices in August were up 5.5% from August 2017. This marks the first time since June 2016 that home prices did not appreciate by at least 6.0% year-over-year. CoreLogic’s Chief Economist Frank Nothaft gave some insight into this change, “The rise in mortgage rates this summer to their highest level in seven years has made it more difficult for potential buyers to afford a home. The slackening in demand is reflected in the slowing of national appreciation, as illustrated in the CoreLogic Home Price Index. National appreciation in August was the slowest in nearly two years, and we expect appreciation to slow further in the coming year.” One of the major factors that has driven prices to accelerate at a pace of between 6-7% over the past two years was the lack of inventory available for sale in many areas of the country. This made houses a prized commodity which forced many buyers into bidding wars and dro

FHA allows owner-occupants to purchase up to a four-unit property with a minimum 3.5% down payment.   The rent collected on three units could be used to make the payment and the owners' pro-rata share would be less than ¼ of the payment itself. The owner-occupied unit would be considered their principal residence.   The other three units are treated as rental property and eligible for cost recovery, a non-cash deduction plus all the normal business expenses.   The rental income of the three remaining units is calculated as income and assists the buyer in qualifying. A homeowner could buy a four-unit, live in one for two years, buy another four-unit with a minimum down payment, move into one unit, rent the other three as well as the previous unit in the first property.   Then, after another two years, repeat the same process over again. The fifth year, the homeowner/investor would have a total of 11 rental units plus the one that they are occupying.   An acquisition strategy l

When it comes to buying or selling a home there are many factors you should consider. Where you want to live, why you want to buy or sell, and who will help you along your journey are just some of those factors. When it comes to today’s real estate market, though, the top two factors to consider are what’s happening with interest rates & inventory. Interest Rates Mortgage interest rates have been on the rise and are now over three-quarters of a percentage point higher than they were at the beginning of the year. According to Freddie Mac’s latest Primary Mortgage Market Survey, rates climbed to 4.72% for a 30-year fixed rate mortgage last week. The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power. Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease

Mortgage interest rates, as reported by Freddie Mac , have increased by close to a quarter of a percent over the last several weeks. Freddie Mac, Fannie Mae, the Mortgage Bankers Association, and the National Association of Realtors are all calling for mortgage rates to rise another quarter of a percent by next year. In addition to the predictions from the four major reporting agencies mentioned above, the Federal Open Market Committee recently voted “unanimously to approve a 1/4 percentage point increase in the primary credit rate to 2.75 percent.” Historically, an increase in the primary credit rate has translated to an overall jump in mortgage interest rates as well. This has caused some purchasers to lament the fact that they may no longer be able to get a rate below 4%. However, we must realize that current rates are still at historic lows. Here is a chart showing the average mortgage interest rate over the last several decades: Bottom Line Though you may have missed t

It may be an all too common belief that a person will have a house payment and a car payment for the rest of their lives.   However, with a plan and some determination, you can be mortgage free. Planning for retirement is obviously important and many times, an activity plagued by procrastination.   Some homeowners' goal is to have their home paid for by retirement, so they won't have payments.   It makes sense to eliminate a sizable recurring expense before they quit working. By making regular principal contributions in addition to the payments, the debt can be eliminated by the target retirement date. Assume a homeowner refinanced their $300,000 mortgage at 4% last year for 30 years with the first payment due on May 1, 2017.   With normal amortization, the home will be paid for at the end of the term.   Additional principal contributions with each payment will save interest, build equity and of course, accelerate the payoff on the home.   An extra $250.00 a month would

We are beginning to see reports that more housing inventory is coming to the market and that buyer demand may not be increasing at the same pace it did earlier this year. The result will be many headlines written to address the impact that these two situations will have on home values. Many of these headline writers will confuse “softening home prices” with “falling home prices,” but there is a major difference between the two. The data will begin to show that home values are not appreciating at the same levels as they had over the last several years (softening prices). This does NOT mean that prices are depreciating (falling prices). Here is an example: Over the last several years, national home values increased by more than 6% annually. If you had a home worth $300,000 at the beginning of the year, it would be worth $318,000 by year’s end. If the appreciation rate “falls” to 4%, that $300,000 house would be worth $312,000 at the end of next year – a $6,000 difference. The price