Hope Leitner, Realtor®, CRS

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...

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 a...