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
Jump & Crash
On the House
Charlie Lawson – GCS Title
Different aspects of the housing market are going in different directions. But the latest “ups and downs” are pretty favorable. RE/Max is out with its latest National Housing Report and it shows we’ve got a healthy market that’s really picking up:
- The U.S. housing market has gone 50 months without a drop in the median sales price
- Home sales jumped 33.4% from February to March – that’s also a 3.6% year-over-year increase
- Forty-four of the 53 metro areas included in the report experienced home price increases
More homes have sold, prices are holding steady and rising in most areas; we’re also finding that the time it takes a home to sell is decreasing:
- March marked the 36th consecutive month where time on market was fewer than 80 days
- The average days on market in March was 71 – down four days from February and seven days year-over-year
As we’re seeing a jump in market activity, we’re simultaneously seeing a crash in mortgage interest rates. We’ve got the lowest interest rates since May 2013 according to the Primary Mortgage Market Survey from guarantor Freddie Mac. This “crash” is a good thing for a lot of people! Lower rates will make it possible for more people to qualify for mortgages and can stimulate buying activity, allowing more homeowners to be able to move up, downsize or move on. One thing to be concerned about is low housing inventory in some housing areas and price ranges; however, your professional real estate and lending professionals can help you be prepared to compete for the home of your dreams in a fast-paced marketplace. Getting pre-approved for a mortgage (and talking to a lender even if you’re not quite ready to buy) and discussing your goals and preferences with a Realtor will help you navigate the market conditions and take advantage of interest rates that won’t last forever. ~Charlie
- Published in On the House
Forever Home?
On the House
Charlie Lawson – GCS Title
Bank of America released its inaugural Homebuyer Insights Report and there was a stat that really jumped out at me: 35% of the people 18 or older surveyed who want to buy a home in the future say they plan to retire wherever they buy. Some of our parents – and probably a lot of our grandparents – lived in one home for most of their adult lives, but the last few decades have seen people buying, selling and moving every 3-7 years. Here are some of the other responses to the survey questions along with some important talking points that we as real estate professionals need to be sure consumers hear and understand:
32% of Millennials said they will wait to pay down debt before buying a home
We need to stress that paying off debt isn’t the only aspect of qualifying for a mortgage and how important it is to make an overall plan for debt, credit and payment-preparedness. “Waiting to pay down debt” doesn’t mean you’re qualified – there are more pieces to the puzzle.
66% of Millennials said they would likely need assistance from their parents to buy their first home
It’s important to include rules and parameters for gift money as well as highlight and publicize the various down payment assistance programs available in our state, cities and counties.
75% of first-time homebuyers said they would skip bypass a starter home in favor of something more desirable
Going from renter to homeowner is a big step for anyone, so making a larger leap from the starting block will require more strategic planning. Again, talking to a lender far in advance of when a consumer *thinks* they’ll be ready to buy is the best way to learn about and maximize opportunity.
My team and I are here to help our Realtor and Loan Officer partners communicate the current conditions and issues in our market as well as help spread the word about the incredible benefits of homeownership. Let’s talk!
~Charlie
- Published in On the House
Urban or ‘Burban?
A few weeks ago we pointed out that Minneapolis made a Top 10 List for downtowns to buy a home in and this week it’s all about the suburbs. The National Association of Realtors (NAR) is constantly conducting surveys and publishing consumer sentiment and preferences. NAR’s latest report found that 85% of current homeowners and 75% of current renters prefer a suburban single-family house versus 15% of homeowners and 21% of renters aiming to buy a residence in an urban area. Anyone who has noticed the number of units being built in our Minneapolis-Saint Paul downtown areas might disagree with this comment from NAR’s chief economist Lawrence Yun: “The American Dream for most consumers is not a cramped, 500-square-foot condo in the middle of the city, but instead a larger home within close proximity to the jobs and entertainment an urban area provides.”
The last thing I want to do is pit urban lifestyle against life in the ‘burbs – to each his or her own. But that’s just it – we at GCS Title and our Realtor and Loan Officer partners are all about helping you own – whatever type of property best suits your personal taste and situation. Homeownership is still the way many Americans build their worth and financial futures, so don’t let trends, general media reports or anyone else besides a qualified professional help you make the huge decision of what – whether – where or when to buy your own home. Of course we navigate you through your closing, but we also work closely with amazing professionals every day and we’re happy to help you find the right real estate and lending professional to get your questions answered! ~Charlie
- Published in On the House
Bulls & Bears in the House
On the House
Charlie Lawson
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
- Published in On the House, Uncategorized
Is This a Good Time?
On the House
Charlie Lawson
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
- Published in On the House
Trendy – Not Spendy
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
- Published in On the House, Uncategorized
Hellooooo….
Anyone out there? This is an interesting time of year. Some people have shut down, others are scrambling to get closings done by year-end. Whether you’re on hiatus or in high gear, this particular stretch on the calendar can leave a lot of us feeling a bit out of sorts, wondering what’s next after the holiday season is finally finished and we’re staring down the barrel the 31 very cold days of January and the clean slate of a new calendar year.
If you’re not one of those amazing, uber-organized people who has your business plan and tasks laid out in detail for the first quarter and knows exactly where you’re going and how you’ll get there, don’t worry. There’s still time to start and initiate the momentum you need. You don’t have to do it all by yourself! If you’re one of our industry colleagues, there’s strength in numbers and accountability relationships. In this peculiar “holiday stall zone,” it’s easy to feel isolated. Let’s talk about what you want to do in 2016!
If you’re a renter or homeowner, your next step is easy. We can put you in touch with real estate and lending professionals who specialize in your area and/or phase of life: First-time buyer, move-up, downsize – whatever!
Bottom line: Phones and email still work this time of year. What’s on your mind?
~Charlie
Charlie Lawson, President & Owner
612-207-2300
clawson@gcstitle.com
- Published in On the House
Holy End of the Year Batman!
Ever hear anybody say this – “If I knew then, what I know now….” – ? A lot of us can apply that to many situations in our lives (and not all are suitable for business blogging). I’d love to know – how was 2015 for you? Whether you made your goals, exceeded your goals, fell short of or didn’t make any goals, a new year always brings new opportunity. There’s always business opportunity out there, but the flipping of the calendar is an opportunity for us to mentally hit a reset button and put the bad part of the past behind us, learn from mistakes, figure out how to expand what we did well and basically organize our thoughts and plan to do better. And it’s exciting!
I attended a business planning workshop this fall and am working with other MN real estate and MN mortgage industry professionals to hold ourselves accountable for the goals we set and the way we plan to achieve them. Are you teamed up with anyone to get and stay on track? It doesn’t take much time – but it brings a ton of benefit. I can help you get the planning tools, help and accountability pieces together to make 2016 a great one.
Let’s take steps now so we can celebrate the decision to do so at this time next year!
Here’s to a great 2016!
Cheers,
Charlie
Charlie Lawson
Owner & President
clawson@gcstitle.com
Call/Text: 612-203-2700
- Published in Uncategorized