Back to School
The kids are headed back to the classroom and it got me thinking that a lot of adults could use some schooling as well. So much has changed in mortgage and real estate in the last few years and recent numbers from Black Knight Financial Services show evidence of housing market recovery:
- Home prices are up 5.3% year-over-year
- Prices as of June rose for the 50th consecutive month
Interest rates are still low, but a lot of young people grew up during a time of great real estate distress and haven’t experienced the strong markets that propelled the worth and wealth building of their parents. They also haven’t experienced the evolution of interest rates and how high they’ve been to know anything other than the “historic lows” we’ve had for years. They won’t last…it’s time to get schooled up on the current market and what’s involved in buying a home to make an educated decision as to whether homeownership is possible and the right decision for the long run. The GCS Title team and I work with many outstanding, experienced real estate and mortgage professionals who can “teach” you what’s involved in the process and “instruct” you on your options. We’re happy to introduce you! ~Charlie
- Published in On the House
Could? Should?
Zillow has been busy. That makes sense – it takes a lot of research activity and media attention to create the massive online presence they have. Their latest release is a data analysis with this headline: “14% of Renters Can Afford to Buy.” It’s human nature to react to headlines, and that’s a statement that can either prompt people to say, “Maybe I can qualify to buy a home!” or “There’s more than an 80% chance I can’t qualify to buy a home.” Outside of an initial reaction to a news story, many renters really do want to know two things: Could I buy a home? Should I buy a home? It’s definitely worth finding out the answer to both of these questions.
The “could” question can easily be answered by talking to a qualified mortgage loan officer. Qualified lenders can tell you what your status is now and help you get prepared to get approved for a loan if you’re not quite ready or have some work or organizing to do with your financing. A loan officer can help you plan and give you a timeline.
The “should” question is a little more complicated. Ultimately, the individual consumer needs to decide that homeownership is for them. Realtors can provide information to help you decide if owning a home will help you move forward with your goals in the short and long term. Housing is the biggest monthly expense most of us have. Advice from a qualified mortgage loan officer and Realtor can help you figure out how to get the best return on that huge monthly investment.
The GCS Title team and I can introduce you to great people who can help you answer the “coulds” and “shoulds” of owning a home. We’re here to help! ~Charlie
- Published in On the House
Upside
Home prices are up again according to the latest figures from CoreLogic. In June, U.S. home prices saw a 5.7% year-over-year increase. Anyone looking for a home in the Twin Cities Metro – whether it’s a first home, a move up or a down-size – has probably experienced the fast pace of the market due in part to low housing inventory. Some of that could be attributed to supply and demand, but CoreLogic’s Chief Economist Frank Nothaft says, “Mortgage rates dipped in June to their lowest level in more than three years, supporting home purchases. Local markets with strong economic growth have generally had stronger home-price growth.”
We did a blog recently explaining how home appreciation outpaced a leading investment index in 2015, and this year looks equally strong. If you have questions about whether or not real estate is a sound investment, now is a great time to talk to a real estate professional about the home you have – or the one you want. A conversation with a loan officer is also a great idea – CoreLogic’s chief economist mentioned interest rates and you should find out what they mean to you. At GCS Title, our team helps home buyers and sellers get to the “closing finish line” – but, we’re here for you at other times as well. What does the housing market news mean to you? We can help you get the answers you need – let’s talk! ~Charlie
- Published in On the House
Boom?
Seems like you can’t look, watch or listen to anything without hearing something about mortgage interest rates, the impact of Brexit an rates and even “more historic lows” and a possible refi boom. There’s a ton of articles, information, speculation and opinion about what homeowners can do and gain during times of low interest rates and a lot of it is interesting and helpful. Here are a couple highlights:
- Save thousands of dollars on the life of their loans by getting a lower rate or shorter term (15 vs. 30 year)
- Pay of a home equity line of credit
- Consolidating debt
- Get rid of mortgage insurance
These can all be great things…the problem is, you can’t know for sure if any of these things are possible and if they make sense for you personally when it comes to costs/fees/savings without getting specific, professional advice. While it looks so available online, it’s not necessarily personalized…a mortgage calculator just doesn’t tell the whole story. At GCS Title, we work with many, many incredible mortgage loan officers. These people are licensed, experienced – and they’re actual, local people who you can reach without going through an automated system – which is a big deal when you’re making choices and decisions that affect such a big part of your finances. Loan officers are happy to discuss your situation and let you know if you have options you didn’t know you had and their findings will be geared to what’s right for you – no obligation. Let us know if we can introduce you to a loan officer who can answer your questions…a refi boom could be a great thing – as long as it doesn’t blow up in your face. ~Charlie
- Published in On the House
Short Supply
Every day, the GCS Title team and I talk with real estate and mortgage professionals. A hot topic lately is “low inventory” in some areas and price ranges. It’s an issue at the national level too according to Zillow – their Chief Economist Dr. Svenja Gudell says, ” There still aren’t enough homes on the market to keep up with the high demand from every type of home buyer. In many markets, those looking to buy a home in the bottom or middle of the market will need to be prepared for bidding wars and homes selling for over the asking price. This summer’s selling season’s borders will most likely be blurred again as many buyers are left without homes and will need to keep searching.” With this in mind, it’s a great idea for current homeowners to find out what their properties are worth. CoreLogic reported that home prices grew 6.7% year-over-year nationwide, so you could have more equity than you think.
Homeowners: Have you checked in with a Realtor lately? You may have options you didn’t know you had. We can connect you with great real estate pros who can give you current, accurate information for your home and neighborhood. Get a status report…you may get some big ideas!
~Charlie
- Published in On the House
No Cause for Alarm
Home prices are up again, though not as much as previous months. It’s funny…the real estate and lending industry trades announce things like the 5% year-over-year home appreciation gain noted in the April S&P/Case-Shiller U.S. National Home Price Index cautiously because the April gain was less than the one in March. Here’s where you need to grab the grain of salt: The gain was 5.1% in March – so the “drop” was a whopping .1%. Here’s what the Managing Director and Chairman of the Index Committee at the S&P Dow Jones Indices had to say: “… the greatest threat to U.S. housing may come from across the Atlantic and from the domestic political scene.” While the Brexit vote and the crazy presidential race we’re watching are important, they don’t change the fact that we all need a place to live and the biggest expense most people have each month goes to housing. SO, as industry experts and TV pundits wring their hands in print, on air and online, talk to local industry experts about what’s going on in your neighborhood, city and personal housing scenario. Ask questions…find out how you’re doing personally and if there are any adjustments that you should or could make to protect yourself or advance your goals. Checking in with experienced real estate and mortgage professionals should be part of a regular routine. The news can be really scary, but your local experts are here to interpret markets and events and can give you great advice and peace of mind.
~Charlie
- Published in On the House
Highs & Lows
The summer could be a rollercoaster based on new information from the National Association of Realtors (NAR) and online real estate resource Zillow. Sales of existing homes went up 1.7% between March and April and they’re up six-percent year-over-year. Prices are higher too: NAR reports that the median home price has jumped 6.3% from April 2015, making this the 50th consecutive month of annual home price gains. So there’s the highs – the lows have to do with housing inventory. The April Zillow Real Estate Market Report shows there are 3.4% fewer homes on the market today than there were this time last year. There’s an eight-percent drop in the number of homes for sale in the entry level price range, making it even tougher for first-time home buyers than other property categories. So we’ve got a supply and demand situation that’s driving prices up. I’m not bringing this up to scare people, but rather to make them aware. These market conditions mean it’s more important than ever for consumers to make sure they’re working with experience, full-time, qualified real estate and mortgage professionals. When bidding wars are likely, top-notch representation is critical. GCS is here to help home buyers and sellers have a great experience throughout the closing process and we work with outstanding Realtors and loan officers every day. Let us know if you’d like to meet one! ~Charlie
- Published in On the House
Appreciation – Want Some?
Pretty much everybody wants a pat on the back, but absolutely everybody likes money in their pocket. New home price information doesn’t exactly put money in your pocket – more like in your portfolio. CoreLogic says home prices went up 2.1% between February and March and they’re up 6.7% year over year between March 2015 and 2016. Here’s what CoreLogic’s chief economist Frank Nothaft said:
“Housing helped keep U.S. economic growth afloat in the first quarter of 2016 as residential investment recorded its strongest gain since the end of 2012. Low interest rates and increased home building suggest that housing will continue to be a growth driver.”
To real estate and mortgage professionals, these numbers are encouraging for the market and business. Consumers may take them either way…renters in particular may get nervous and think homeownership is out of their reach before they’ve taken even the most preliminary steps to pursue it. Let’s work together to get the word out that while “timing is everything,” it’s also very individualized. Getting help and guidance from professional Realtors and loan officers will help determine the right time to buy a home and getting into one will help people start building equity. Their pocketbooks will appreciate it. Let’s help them get started! ~ Charlie
- Published in On the House
MN in the Middle?
I guess you could say MN is physically in the middle of the country, but you might find it surprising to find that it’s in the same position with regard to median rents. Check this out: Nationally, the average rent for a one-bedroom apartment is $1140 and $1300 for a two-bedroom. We’re keeping right up here in Minnesota – the average price for a one-bedroom in the metro area is $1036 and $1438 for a two-bedroom. Year over year, rents are up 2.8% nationwide as of April. Isaac Newton’s famous quote “What goes up must come down” never seems to apply to things that require money coming from your pocket, so it’s doubtful rents will be headed in the opposite direction.
Price, market, interest rate fluctuations and compliance issues make it really hard to publish comparisons between monthly rent and payments on a home. But that shouldn’t stop those of us in the industry from having comparisons on hand between rent and mortgage payments that can be rattled off in conversation with our leads, prospects, strangers and anyone else we come in contact with. The fact that a home can be purchased for the same amount or less than rent often sparks “water cooler conversations” and a lot of questions that we and our Realtor and loan officer partners are happy to answer. Let’s get the buzz going!
- Published in On the House
Consider Construction
On the House
Charlie Lawson – GCS Title
Recent figures from the government might be a bummer for home builders, but they’re keeping a stiff upper lip. There are so many numbers about what’s going on month-over-month and year-over-year, but there’s a couple of quotes from big brains in the industry that I think explain the fact that builder confidence hasn’t wavered much even though reports indicate their progress has hiccupped a little:
“We still expect strong housing demand and low inventory in the market for previously owned homes to lift single-family housing starts, later in the year.” – Genworth Mortgage Insurance Chief Economist Tian Liu
We mentioned tight inventory in some market areas and price ranges in last week’s blog, so Mr. Liu’s assessment seems right on and a good reason for home buyers to check out new construction. The next quote also touches on something we mentioned in last week’s blog – the fact that rates dropped to a three-year low:
“Solid job creation and low mortgage interest rates will sustain continued gains in the single-family housing market in the months ahead.” – National Association of Home Builders Chief Economist Robert Dietz
Whether you’re looking for a brand new home – or just a home that’s brand new to you – the same things are important: Planning and professional help. Anyone thinking of buying a home needs to get a personal consultation regardless of what your timeframe is. Competition for existing homes can be tough, so pre-approval for a mortgage and great representation will help you make the most of what’s available. We work with many experienced professionals and would be glad to refer you to someone who can help. We also have many builder partners, so let us know if we can help! ~Charlie
- Published in On the House
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