Hope Leitner, Realtor®, CRS

Some Highlights: •June is National Homeownership Month! •Now is a great time to reflect on the many benefits of homeownership that go way beyond the financial •What reasons do you have to own your own home?

There have been many headlines decrying an “affordability crisis” in the residential real estate market. While it is true that buying a home is less affordable than it had been over the last ten years, we need to understand why and what that means. On a monthly basis, the National Association of Realtors (NAR), produces a Housing Affordability Index. According to NAR, the index… “…measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national and regional levels based on the most recent price and income data.” Their methodology states: “To interpret the indices, a value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home. An index above 100 signifies that family earning the median income has more than enough income to qualify for a mortgage loan on a median-priced home, assuming a 20 percent down payment.” So, the higher the index, the more a

In today’s housing market, home prices are increasing at a slower pace (3.7%) than they have over the last eight years (6-7%). However, they are still are above historical norms. Low supply of listed homes and high demand from buyers has pushed prices to rise rapidly. In the mind of the homeowner, annual home price appreciation over 6% has become the new normal. This becomes a challenge when a homeowner looks to refinance or sell their home, as the expectation of what the homeowner believes the home should be worth does not always line up with the bank’s appraisal. Every month, the Home Price Perception Index (HPPI) measures the disparity between what a homeowner seeking to refinance their home believes their house is worth and what an appraiser’s evaluation of that same home is. Over the last five months, the gap between the homeowner’s opinion and the bank’s appraisal has widened to -0.78%. This is important for homeowners to note, as even a 0.78% difference in appraisal can mea

Some Highlights: •The National Association of Realtors surveyed their members & released the findings of their Profile of Home Staging. •62% of seller’s agents say that staging a home decreases the amount of time a home spends on the market. •50% of staged homes saw a 1-10% increase in dollar-value offers from buyers. •77% of buyer’s agents said staging made it easier for buyers to visualize the home as their own. •The top rooms to stage in order to attract more buyers are the living room, master bedroom, kitchen, and dining room.

For people who have experienced a distressed sale of a home and gotten their finances and credit back in shape, there can still be an unanswered question of "How long do we have to wait to qualify for another mortgage."   The loan types for the new loan will differ in amounts of time based on the event.   The different lending authorities, VA, FHA, Fannie Mae (FNMA) and Freddie Mac (FHLMC), establish their own waiting periods.   A borrower may be eligible to qualify for one type of mortgage before another type, even though during this waiting period, that the person was current on all payments and maintained a history of good credit. The following chart indicates how long a person might have to wait. A recommended lender can give you specific information regarding your individual situation and can make suggestions that will improve your ability to qualify for a mortgage.   This process should be started before looking at homes because of the time constraints listed he

Every year, Gallup surveys Americans to determine their choice for the best long-term investment. Respondents are given a choice between real estate, stocks, gold, and savings accounts. For the sixth year in a row, real estate has come out on top as the best long-term investment! That has not always been the case. Gallup explains: “Between 2008 and 2010, covering most of the Great Recession period that saw plummeting home and stock values, Americans were as likely to name savings accounts or CDs as the best long-term investment as they were to name stocks or real estate.” This year’s results showed that 35% of Americans chose real estate, followed by stocks at 27%. The full results are shown in the chart below. Bottom Line Now that the real estate market has recovered, so has the belief of the American people in the stability of housing as a long-term investment.

According to CoreLogic, from 2006 to 2014 “there were 7.3 million housing foreclosures and 1.9 million short sales.” The hesitation some Americans feel after experiencing a foreclosure brings to mind the old saying: “Fool me once- shame on you. Fool me twice- shame on me.” According to the 2019 Home Buyer Report from NerdWallet, “Thirteen percent of Americans have lost a home due to a financial event such as foreclosure in the past 10 years. More than 6 in 10 of them (61%) have not bought a home since, and 20% of those who haven’t repurchased say they never plan to again.” This makes sense. They don’t want to go through the same pain again. As a cornerstone of the American dream, nobody wants to lose homeownership. But let’s illustrate this simply: Recall learning to ride your first bike during your childhood. Did you stop riding it because you fell on the ground and scraped your knees? Or did you get back on and try again until you were able to ride without falling? Purchasing

Many studies suggest one of the main reasons for the inventory shortage in today’s market of homes for sale is that older generations have chosen to “age in place” over moving. The 2019 Home Buyers & Sellers Generational Trend Report by NAR clarifies this point! NAR’s findings show that Baby Boomers (43%) and the Silent Generation (12%) made up 56% of sellers in 2018! This means the majority of sellers last year were over the age of 54. This also shows these generations ARE moving! The report also shared the reasons why they chose to move. According to the research, the top reason was a desire to be closer to friends and family. Below is a full breakdown: As we can see, they have plenty of reasons to sell their current home! But what type of homes are they trading in? Once again, the report demonstrated that older generations are not keeping that 3-bedroom, 2-bath colonial home. Instead, they are putting it on the market and moving on with their lives! Bottom Line If

In today’s real estate market, low inventory dominates 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 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. Know the Differ

According to the 2018 Profile of Buyers and Sellers, 52% of buyers want help to find the right home to purchase.   Physically locating the home is certainly part of what buyers want from their agent but finding the right home at the right price and terms is also crucial. 87% of buyers purchased their home through a real estate agent or broker.   Slightly more than half of buyers were referred to their real estate professional by/or is a friend or relative or had used the agent previously to buy or sell a home. There are tech tools that can be used together with the expertise and experience of your real estate professional to make the home buying process efficient and effective. Listing Alert ... while this service is called by other names, the buyer identifies the specifics about the home they want, and it will notify them directly when a new listing comes on the market that matches their needs. Real estate smartphone apps ... imagine driving a neighborhood, seeing a sign and

Home values have softened over the last twelve months. We are no longer seeing 6-7% annual appreciation levels for the national housing market. The current numbers are closer to 4%. Some have suggested that year-over-year appreciation levels could fall to 3% or less this year. However, a stronger-than-expected economy and a good spring housing market have changed some opinions. Some analysts are now predicting that home value appreciation may begin to increase as we move forward. Here are three examples: Mark Fleming, Chief Economist of First American “Data on the movement of unadjusted house prices during the early spring home-buying season won’t be available for a few more months, but it’s quite likely that price appreciation will accelerate again.” CoreLogic’s April “Home Price Insights” “Home prices nationwide, including distressed sales, increased year over year by 3.7% in March 2019 compared with March 2018…The CoreLogic HPI Forecast indicates that home prices will in

Some Highlights: •ATTOM Data Solutions conducted an analysis of more than 29 million single family home and condo sales over the past eight years to determine the top days to list your home for sale. •The top five days to list your home brought in a 10% premium over market value and are all in either May or June! •“Families start their home search when they know their kids will be out of school and when the weather is ideal for home viewing and moving, giving home sellers an upper hand in price negotiations.” •There is still time to list your home before these dates pass you by!

Home prices have been on the rise for the last seven years, leading many housing market analysts to conclude that first-time homebuyers are being shut out of the market due to affordability concerns. The National Association of Realtors (NAR) reports on the percentage of First-Time Home Buyers (FTHB) on a monthly and yearly basis. Their latest report shows that FTHB’s made up 33% of buyers in March, which matches their reported share in 2018. NAR uses survey data from their members to come up with this statistic, so their results do not include every transaction completed. Rather, they only the transactions reported by members who complete the survey. The other entity that reports on FTHB share is the American Enterprise Institute (AEI). The AEI uses data from mortgage applications that define an FTHB as “any borrower who did not have a mortgage for the preceding three years.” This means the AEI measurement also includes former homeowners who transitioned out of a home they previ

So, you’ve been searching for that perfect house to call ‘home,’ and you’ve finally found it! The price is right, and in such a competitive market, you want to make sure you make a good offer so that you can guarantee that your dream of making this house yours comes true! Below are 4 steps provided by Freddie Mac to help buyers make offers, along with some additional information for your consideration: 1. Determine Your Price “You’ve found the perfect home and you’re ready to buy. Now what? Your real estate agent will be by your side, helping you determine an offer price that is fair.” Based on your agent’s experience and key considerations (like similar homes recently sold in the same neighborhood or the condition of the house and what you can afford), your agent will help you to determine the offer that you are going to present. Getting pre-approved will not only show home-sellers that you are serious about buying, but it will also allow you to make your offer with confidenc

The housing crisis is finally in the rear-view mirror as the real estate market moves down the road to a complete recovery. Home values are up and distressed sales (foreclosures and short sales) have fallen to their lowest point in years. The market will continue to strengthen in 2019. However, there is one thing that may cause the industry to tap the brakes: a lack of housing inventory! Buyer demand naturally increases during the summer months, but supply has not kept up. Here are the thoughts of a few industry experts on the subject: Lawrence Yun, Chief Economist at National Association of Realtors “Further increases in inventory are highly desirable to keep home prices in check, the sustained steady gains in home sales can occur when home price appreciation grows at roughly the same pace as wage growth.” Jessica Lautz, Vice President of NAR “There’s a supply-demand mismatch… More inventory is needed at the lower end and a price reduction may be needed at the upper end.”

Heating and air-conditioning are frequently referred to as the "comfort systems."   If one has gone out in the dead of winter or the heat of summer, lack of comfort becomes a primary concern.   Regular maintenance with a HVAC checklist is something that homeowners can do themselves to ensure that the units operate properly. Periodically Change your filter every 90 days; every 30 days if you have shedding pets.   Maintain at least two feet of clearance around outdoor air conditioning units and heat pumps. Don't allow leaves, grass clippings, lint or other things to block circulation of coils. Inspect insulation on refrigerant lines leading into house monthly and replace if missing or damaged. Annually, in spring Confirm that outdoor air conditioning units and heat pumps are on level pads. Pour bleach in the air conditioner's condensation drain to clear mold and algae which can cause a clog. Avoid closing more than 2

If you are in the market to buy a home this year, you may be confused about how much money you need to come up with for your down payment. Many people you talk to will tell you that you need to save 20% or you won’t be able to secure a mortgage. The truth is that there are many programs available that let you put down as little as 3%. Those who have served our country could qualify for a Veterans Affairs Home Loan (VA) without needing a down payment. These programs have cut the savings time that many families would need to compile a large down payment from five or more years down to a year or two. This allows them to start building family wealth sooner. So then, why do so many people believe that they need a 20% down payment to buy a home? There has to be a reason! Today, we want to talk about four reasons why putting 20% down is a good plan, if you can afford it. 1. Your interest rate will be lower. Putting down a 20% down payment vs. a 3-5% down payment shows your lender/bank

Recently, we reported that many believe a recession could happen within the next two years. We explained that 70% of economists and market analysts surveyed last year believe that a recession will occur in 2019 or 2020 and that 42% of consumers currently looking to purchase a home also agree that a recession will occur this year or next. However, the U.S. economy has performed well in the first quarter of 2019 and that has caused some experts to change their thinking on an impending economic slowdown. Here are a few notable examples: Anthony Chan, Chief Economist at JPMorgan Chase “I feel really comfortable that the economy is slowing down this year, but not going into a recession… It doesn’t look, to me, like the odds of a recession in 2020 are there.” Dean Baker, Senior Economist at the Center for Economic & Policy Research “To sum up the general picture, the U.S. economy is definitely weakening… However, with wages growing at a respectable pace, and job growth remain

So, you’ve decided to sell your house. You’ve hired a real estate professional to help you through the entire process, and they have asked you what level of access you want to provide to your potential buyers. There are four elements to a quality listing. At the top of the list is access, followed by condition, financing, and price. There are many levels of access that you can provide to your agent so that he or she can show your home. Here are five levels of access that you can give to buyers, along with a brief description: 1. Lockbox on the Door – this allows buyers the ability to see the home as soon as they are aware of the listing, or at their convenience. 2. Providing a Key to the Home – although the buyer’s agent may need to stop by an office to pick up the key, there is little delay in being able to show the home. 3. Open Access with a Phone Cal l – the seller allows showings with just a phone call’s notice. 4. By Appointment Only (example: 48-Hour Notice) – Many b

Your income tax is probably filed for last year by now and you've been through your expenses for the year.   M oney spent on repairs to your home is not deductible but being aware of how much you spent last year may help you make a decision that could save you money this year. Sellers, often, provide a home warranty to buyers to give them peace of mind by limiting some of the out-of-pocket money spent on unexpected repairs for one year.   Home warranties can be renewed by the buyer by paying the annual fee and any homeowner can purchase one for their home whether they had one when they bought it or not. A home service contract typically covers mechanical systems and built-in appliances in the home.   Many times, these items are not covered by the homeowner's insurance policy.   They can also include other things such as pool and spa equipment, and free-standing appliances like refrigerators, washers and dryers. The process is simple.   It doesn't cover pre-existing co

Some Highlights: •Historically, the choice between renting or buying a home has been a tough decision. •Looking at the percentage of income needed to rent a median-priced home today (27.7%) vs. the percentage needed to buy a median-priced home (17.5%), the choice becomes obvious. •Every market is different. Before you renew your lease again, find out if you can put your housing costs to work by buying this year!

Two positive trends have started to emerge that impact the 2019 Spring Housing Market. Mortgage interest rates for a 30-year fixed rate loan have dropped to new lows, right as reports show that wages have increased at their highest rate in decades! These two factors have helped keep housing affordable despite low supply of houses for sale driving up prices. First American’s Chief Economist, Mark Fleming, explains the impact, “Ongoing supply shortages remain the main driver of the performance gap as the housing market continues to face an inventory impasse – you can’t buy what’s not for sale . However, an unexpected affordability surge, driven primarily by lower-than-anticipated mortgage rates, rising wages and favorable demographics, has boosted housing demand.” Mortgage interest rates had been on the rise for most of 2018 before reaching their peak in November at 4.94%. According to Freddie Mac’s Primary Mortgage Market Survey, interest rates last week came in at 4.20%. Avera