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
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
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
A lot of new rules and changes have hit the real estate and mortgage industries in the last few years. Here’s a little background and an update and then we’ll get to what you really need to know.
The intent of a lot of these new regulations – and all the acronyms that go along with them like CFPB and TRID – is to educate and protect consumers. The Dodd Frank Act is responsible for a lot of changes in the way business is done going forward and there are many folks opposed to all or part of the sweeping bill. A congressman from Texas has now introduced what he calls “the Republican plan to replace Dodd-Frank and promote economic growth.” Its name is Financial CHOICE Act— complete with its own acronym that stands for “Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs.” It’s not clear if it will get anywhere – there’s no companion bill in the Senate yet or official reaction from the rest of Washington.
It’s almost impossible to keep track of everything politicians are up to with regard to real estate and mortgage regulation. For now, know this: You need to surround yourself with great professionals who are up to date on the rules, timelines and how to make the transaction go as smooth as possible for everyone involved. At GCS Title, we have an amazing team dedicated to doing just that. Meet our great people here: https://www.gcstitle.com/meet-the-team/
Whether you’re a Realtor, a loan officer, a homeowner or potential buyer, we want you to know “we get it” and we’re here to help. Call us any time! ~Charlie
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
On the House
Bulls & Bears in the House
There seems to be a difference of opinion between people who own homes and people who would like to buy them. The National Association of Realtors puts out what they call the Housing Opportunities and Market Experience (HOME) Survey every quarter and the latest one shows different attitudes between homeowners and potential buyers when it comes to timing. Check out the differences:
75% of potential buyers believe now is a good time to buy a home
56% of current homeowners believe now is a good time to sell a home – down from 61% during Q4 2015)
These numbers indicate a bigger appetite for buying homes than selling, but confidence is also slipping a bit regarding the economy:
48% of households feel the U.S. economy is improving – down from 50% in Q4 2015
To make a lame Wall Street reference, you could say that the bears own houses and the bulls are renting; but the last stat from the survey seems to show that everyone seems a little uneasy about the economy which is not uncommon in an election year (and this one is turning out to be a doozy). Lack of inventory (homes for sale) in certain price ranges has been an issue and widely reported and discussed for some time. The important takeaway for the public not to make assumptions because market conditions vary – even by neighborhood. We as real estate and lending professionals need to make sure we arm potential buyers and sellers with the latest local information so they can decide whether or not it is in fact a good time for them to buy or sell. ~Charlie
On the House
We see polls and surveys in the news all the time. Have you ever participated in one? Ever wonder ‘who the people are’ answering the questions that create the statistics and basis for stories and hype – both good and bad? I can’t answer that here, but there is something a bit funny in the National Association of Realtors (NAR) March 2016 Home Survey – along with some interesting factors that renters and homeowners should consider. First, here are some results:
75% of U.S. Households believe now is a good time to buy a home
44% believe this strongly
I would love to know how that question was asked. After getting an affirmative answer to the buying/timing question, I wonder if the pollster said something like, “Are you sure about that?” Here’s another great nugget that hits close to home: 80% of people in the Midwest believe now is a good time to buy, compared with 77-percent in the south, 74-percent in the Northeast and 61-percent in the West. Even with 31-percent of respondents believing now is a good time to buy a home not specifying they believe that strongly, this is encouraging news for the spring and summer market season locally.
The public is “in the mood for home buying.” As real estate and lending professionals, we need to make sure they have all the information they need to move forward and make choices. Where shall we start? Neon signs and sandwich boards with “buy versus rent” comparisons won’t cut it, but working together to reach the public will. Let’s reach out together! ~Charlie
On the House
Charlie Lawson – GCS Title
Trendy – Not Spendy
Minneapolis got a big shout out from Realtor.com by being included in their recent list of “The Top 10 Trendiest Cities That You Can Still Afford to Buy In.” They made the list based on different things that appeal to and impact hipsters (their word – not mine) – which I’ll interpret as the group the rest of us refer to as Millennials. Minneapolis came in at #5 in this list that boasts a high number of yoga studios and bike shops per capita. Don’t laugh – there’s more to this and good news for the normal folk too.
Outside of Minnesota, the entire Minneapolis-Saint Paul Metropolitan area is referred to as “Minneapolis” and while it’s not fair to Saint Paul or the other cool spots in the ‘burbs, it’s unavoidable. Just like the pro sports teams use the concept of “community benefit” to get us to pay for stadiums, publicity like this is great for our whole metro market that extends far beyond the Minneapolis city limits. (And we are getting a new stadium soon too.) The key word in this list is “afford” though. The idea that jobs, salaries and home prices fall into a range where a significant number of people can become homeowners is great news not just for real estate professionals, but for our communities at large. Think about pride of ownership in neighborhoods, the likelihood that people will live, work and volunteer close to home and the long term boost to people’s financial health that owning a home can bring.
Every week my research team and I bring you news, facts, stats and ideas that boost not only our business, but the reason most of us got into it in the first place: To help people achieve the American Dream. So, let’s make sure we claim some bragging rights and spread the word. ~Charlie
The whole list: 1. Salt Lake City 2. Richmond, Va. 3. Asheville, NC 4. Pittsburgh 5. Minneapolis 6. Ann Arbor, 7. Cincinnati 8. St. Louis 9. New Orleans 10. Charleston, SC
Millennials…we hear this group mentioned so often, I’m starting to feel like Jan from the Brady Bunch – “Marcia, Marcia, Marcia!” But I can’t deny how important they are to the MN housing market and economy, so I’ll get over myself to share some important news: The use of FHA loans (and other low down payment programs) to purchase homes is up 23-percent from the first quarter of this year according to RealtyTrac and the interpretation is that more MN first time home buyers are getting into the market. That’s great because we need them! Millennials have been lukewarm about MN homeownership for the last few years, so the real estate community really needs to reach out and share the news that FHA made some changes that make payments more affordable. There’s also other low down payment programs – even MN down payment assistance – so we all need to make sure that we promote all the great options to help people buy MN homes – Millennials or not.
If you’re thinking of buying or selling, I can put you in touch with great real estate and mortgage professionals who specialize in your area and situation. Message me!
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