Think about Selling?-According to the National Associations of Realtors Homeownership and Market Experience (HOME) Survey, most Americans believe that now is the perfect time to become a homeowner. According to the survey, 72% of people believe now is a good time to buy.
This could be because of the changing economic situation. 52% of Americans surveyed believe the US economy is improving, and according to a recent Neighborworks survey, 81% of Americans believe owning a home will make them more financially stable.
It could also be because homeownership is still such a deeply ingrained part of the American culture. According to that same Neighborworks survey, a whopping 93% of people believe owning a home is a part of the American dream, with 18% claiming it’s the most important part.
And with so many new buyers flooding the market, it creates the perfect opportunity for sellers. With more people believing now is the time to buy, the market is struggling to keep up with demand. Low inventory, particularly in the starter home sector, creates more competition between buyers and can be a lucrative opportunity for sellers to get the most for their homes.
The Takeaway For Think About Selling
If you think about selling, take advantage of all the new buyers in the market and use it to get the most for your home!
If you think of selling and taking advantage of the statistics in this article please keep me in mind. It would be a pleasure to assist you in all of your real estate needs in the Farmington Hills Michigan area. As your #1 Farmington Hills Michigan Realtor I have the knowledge it takes to find your the best deal or to sell your home for the most money possible. Together lets make the most out of this low inventory and beat the coming spring competition to the Farmington Hills housing market. You can reach me at 248-790-5594
Rent isn’t cheap. It’s tough to afford a place on your own. So, you have roommates. Maybe it’s a friend or two. Maybe more. But it certainly beats living “alone”…in your parent’s basement.
But you’re still not banking money…Roommates can help!
You’re saving some money by renting with others. But not tons.
It certainly makes your housing costs more affordable, but it isn’t like you have so much extra every month to just go out and spend on whatever you want.
So, it’s probably hard to even imagine saving enough to eventually buy a house.
You figure that day will come eventually. But not anytime soon. You’ll figure it out someday.
Probably not until you find someone you want to settle down with. Not until you and a significant other can combine forces (and bank accounts) to make that dream happen.
But, at this point, you wrap that thought up with a nice bow and put it on a shelf.
You rationalize it, and think…
- I’m still young.
- I’m too young.
- I don’t want to be tied down yet.
- I certainly don’t want to settle down with just anyone to be able to afford to buy a house.
- I’ve heard that buying a house is a stupid investment, anyway.
All totally fine rationale. If you want to rationalize. But, what if you would like to buy a house?
How in the world are you supposed to pull that off?! You can barely afford to rent a place without a bunch of other people chipping in.
Someone’s making dough off you and your roommates. Why not you?
Sometimes it feels better to rationalize away something you don’t think you can swing.
And that’s probably where most people in your position stop. They don’t even consider buying a house.
But you can think beyond that…if you want.
Maybe there’s a way for you to buy a house. Now.
That’s not to say it’s a definite possibility, or a no-brainer, or even easy. But it could be all three of those things. You won’t know, unless you at least consider it.
You and your roommates are all paying someone to live where you live. Some landlord.
What if it could be you? What if they were all paying you to live in your house?
There’s a lot of ways to flip this around in your head. Too many to even list. But here’s a few bullet points for you to consider and get your thoughts going…
- What if you could buy a house that cost the same, or less than the amount you’re all paying in rent per month?
- What if you found a house that needed some work and could get your roommates to help you fix it up so it is worth more than you bought it for?
- What if you bought a multi-family building and could rent to more people, or split up your roommates into separate apartments?
- What if you could actually cover the monthly mortgage with the amount your roommates are already used to paying per month, and not have to pay your share of the rent?
- What if you could purchase a place with a very low down payment?
- What if you went in with your roommates and bought a place together? (Obviously this is a pretty big commitment, so use your judgment before jumping into a relationship like this.)
- What if the first place you bought ended up being a stepping stone to owning several rental properties?
The list could go on. But the point is to get you thinking beyond just throwing your portion of the rent into the mix every month with nothing to show for it once you all move on in life.
Not a pipe dream
Buying a house doesn’t just happen.
You can’t just read an article online, get the idea in your head, and talk about how cool it would be while you’re drinking beers in your apartment watching TV.
In fact, maybe keep it to yourself until you figure it all out.
But before you actually buy a place, you should probably see if your roommates would be down with you being their landlord and roomie. If not, maybe find other friends who will.
Buying a house is a process. It’s not as hard or impossible as you might think, but there’s definitely steps you need to take in order to figure out if you can buy a house, and what you can buy if you can.
Have a plan
As tempting as it is to start looking at houses for sale online, or going to see houses in person…don’t. Not yet at least.
That isn’t the best first step. Lots of people start that way, but they waste tons of time, and it can lead to making awful purchases.
Your first purchase needs to be as good of a choice as you can make, because it will set you up for an awesome future. A bad first purchase can be a disaster for years to come.
There’s so much information out there about buying houses. You can do it all on your own. Just troll the Internet, or go bonkers and actually buy some books.
But, you can also get the best insight, plan, and help for free…from a real estate agent.
It’s important to find a real estate agent you trust
It’s easy (and common) to not entirely trust real estate agents, and want to learn as much as you can on your own before dealing with them. To some degree, you can’t trust every and any old real estate agent.
But the first and best step to buying your first house is to find the best real estate agent you can…and then let that agent guide you step by step through the process.
It usually doesn’t cost you anything out of pocket to hire and work with a real estate agent when you’re buying a house. They get paid when and if you end up buying.
And since they all work that way (for the most part), you may as well find and hire the best one you can find.
I’d like to help you find that agent. I think and hope you’ll find that it is me. But I want to earn that trust and respect.
So, no pressure or obligation.
Send me an email with the subject line, “Please send me your first-time buyer tips” and I’ll send send you a short series of 9 emails (no more, no less) that will help you decide if you should buy your first home, or not..
In the least, you will get further along the way to buying your first house, and perhaps we will build a trusting relationship. Or not.
If we do, great. And, if you qualify to buy a house, I want to help you make the best purchase possible.
And if we don’t, I won’t be bugging you or pushing you to buy a house.
So, what’s the harm? Send me an email and I’ll send the first step to buying a house over to you. (NOTE: It includes names and phone numbers I don’t publish publicly, which is the reason for doing it via email.)
You can find my email in the right column of this page (if on desktop) or down below (if on mobile).
Hope to hear from you!
Should you buy a home in your 20s? Good question. There’s no single, sure-fire answer to it. Okay, there is…if you consider “it depends” to be a solid answer.
You can search the Internet and find as many reasons to buy a house in your 20s, as you can find to not buy a house in your 20s. But you have to consider the source of every article. (As I’m sure you do.) What’s the author’s motivation?
All you’re really doing is confusing yourself, or convincing yourself what you already want to believe.
So, the better question is…
Do you want to buy a house?
Before you answer…
Maybe ask yourself a couple of other questions.
- Do you feel too young to buy a home?
- Do you feel old enough to buy a home?
They sound like the same question, just turned inside out. But they aren’t really. Not if you really stop and think about them and how they relate to you. These are deeper questions not everyone in their 20s cares to ponder.
And that in and of itself is probably a pretty good answer to the question. If you can’t, won’t, or don’t want to think it through on a deeper level, then you probably aren’t ready — whether you want to or not, you probably shouldn’t.
So, if you’re the type that cares to ponder those questions, please do. We can move on when you’re done. The words below will still be here in a few minutes.
Don’t decide against buying a home, just because your friends aren’t buying them
It’s true. Most 20-somethings don’t buy a home. And if you ask around, most 20-somethings will give totally legit sounding reasons why they can’t, won’t, or don’t.
But that doesn’t mean they truly can’t…or shouldn’t. What it probably means is that they haven’t given it all that much thought. They’re probably just spitting out answers that they’ve assumed or overheard from their peers.
Or they’re just unconsciously following the crowd.
This is nothing new. This happens generation after generation. Trends happen.
Right now, it just so happens that most people in their 20s follow a different path. Most first-time buyers don’t buy until their early 30s.
And that’s why you might want to give the whole buying-a-house-in-your-20s thing some serious thought…
At some point, most of your peers will want to buy their first house
At some point, people stop wanting to “play house”, and actually buy a house instead of renting or living at home.
It never gets easier. At any given moment in time, the interest rates matter. Housing prices matter. The job market matters. One’s lifestyle matters. Everything always matters.
But everything is always relative.
Sure, all of that dictates what you can purchase. However, first homes are rarely ever as awesome as someone hopes for. They’re called “starter homes” for a reason. It’s rare that a first-time buyer is buying their dream home.
Buying your starter home, condo, or multi-family home earlier on, gives you a leg up amongst your peers. You get a head start. You’ll be a step ahead in getting to your dream home. And maybe you’ll even be able to keep the first home as a rental property.
If you want to buy a home…
Obviously, if you want to buy a house, you’ll want to do your research. It’s easier now than it ever has been to find information online.
But as misleading as the information out there is on whether you should even buy a house in your 20s, so is the information on the best way to approach it.
Lots of people make mistakes when they buy houses. Not just first-time buyers.
The Internet has certainly made a lot of information available. But it has not necessarily made everyone who looks at the information an expert in the process, or analyzing the options. It has simply made it easier to avoid dealing with the experts.
Don’t avoid dealing with the experts
Many people want to avoid dealing with real estate agents. There are good reasons for that; not all real estate agents are great. Some are pushy. Some will sell you on doing something. Some don’t have any more clue than you do.
But some are great. And that should be your first, and most important step in buying a home.
Find a great real estate agent
A great real estate agent will essentially cost you the same to work with as one that’s not so great. And, whatever agent you hire won’t cost you a dime until and unless you buy a home. So you might as well choose the best one you can.
It’s important to find a real estate agent you trust
Too many people don’t make a deliberate decision on the real estate agent they hire. People tend to just stumble into working with a real estate agent they meet along the way who is “nice enough”.
I can’t or won’t say I am the best, or that I’m the right real estate agent for you. But I can say that I take pride in building trust with my clients and doing the best job possible.
And I’d like a chance to show you that. I don’t mean call me and let’s run out and start looking at houses. I don’t even mean give me your email address so I can spam the heck out of you forever.
What I mean is this…
Send me an email and I’ll send you a short series of 9 emails (no more, no less) that’ll help you decide if you should buy your first home, or not.
n the least, you’ll get further along the way to buying your first house, and perhaps we will build a trusting relationship. Or not.
If we do, great. I hope to help you decide if you should even buy in your 20s or not. And if you do, I want to help you make the best purchase possible.
And if we don’t, I won’t be bugging you or pushing you to buy a house beyond this series of emails.
So what’s the harm?
Send me an email with the subject line, “Please send me your first-time buyer tips” and I’ll send the first one over to you.
(NOTE: It includes names and phone numbers I don’t publish publicly, which is the reason for doing it via email.)
You can find my email in the right column of this page (if on desktop) or down below (if on mobile).
Hope to hear from you!
Buying a Home is Now!
If you’re considering buying a home, ask any real estate agent worth their salt and they’ll tell you: NOW is the time to do it.
The real estate market is seemingly changing by the day, and if you want to get a great home for a great price, making a move now is in your best interest; conditions a year from now (or even six months from now) aren’t likely to be as hospitable.
And why is that? Why shouldn’t you, if you’re interested in buying a home, wait? Why is NOW the time to make a move?
1. Interest rates won’t stay this low
The first reason you should buy a home now is that interest rates are extremely competitive. While they aren’t at the near-historic lows homeowners enjoyed in 2016, they’re still hovering in the high 3%’s for 30-year fixed mortgages and the low 3%’s for 15-year loans.
But that’s going to change.
Mortgage rates are scheduled to rise at least 3 times in 2018, with many experts predicting the interest rate for a 30-year fixed mortgage to reach 5% by the end of 2018.
But what does that mean for you as a potential homeowner?
Let’s say your mortgage principal is $200,000. If you secured your mortgage with a 3.87% interest rate, the total interest you would pay over the course of the loan would be $138,571 (360 monthly payments of $940, for a total of $338,571).
Now, if you secured a mortgage with a 5% interest rate, the total interest you would pay over the course of the loan jumps to $186,152, a difference of $43,581 (if you’re interested in how changing interest rates affect the total cost of a mortgage, you can check out this interest rate calculator tool).
Locking in a lower interest rate on your mortgage will save you tens of thousands of dollars over the course of your loan, which is why securing a loan now is in your best interest.
2. Competition is getting fierce
Another reason now is a good time for buying a home is that housing markets are growing more competitive every day.
Now that much of the country has recovered from the recession, more and more people are in the position to purchase real estate. And the more people there are on the market, the more competition there is for homes.
Competition is getting fierce in markets across the country. Homes are sold almost immediately, often at above asking price, and sellers are often dealing with multiple offers.
The competition in most real estate markets is still manageable and deals are still to be found, but as the economy continues to improve, the competition will heat up even more – making finding and buying the home of your dreams significantly more challenging (not to mention expensive).
3. Homes are getting more expensive by the day…
Speaking of expensive, homes are (literally) getting more expensive every day. In fact, as of June 2017, home prices have been rising every single month for well over 5 years.
And that trend shows no sign of slowing. Experts predict home prices will jump up to 5% more in 2017 and another 3.5% in 2018 (with hot markets, like the Pacific Northwest, seeing even greater increases). Which means that if you purchase a home at the end of 2018, you can expect to pay an average of 8.5% more than you would pay today.
Combine the rising interest rates with the rising home prices and you’ve got a recipe for paying a lot more for a home a year from now than you would pay today.
4. … And there are fewer to choose from
One of the factors in rising home costs is low inventory. When there are too many people who want to buy homes and not enough homes for them to buy, it drives up prices and competition in the market.
We have a huge problem with low inventory now, but unfortunately, that problem doesn’t have a simple solution. As interest rates rise, people are less likely to put their homes on the market in an effort to preserve the lower interest rates on their mortgages.
The moral of the story is: there’s low inventory now, but there’s likely to be lower inventory in the future, which means prices will soar even higher. It’s better to buy now then it is to wait for the problem to get work.
Buying a home is a big decision. But if it’s a decision you’re considering, now’s the time to make a move. You’ll enjoy lower interest rates and an overall less expensive (and less stressful!) experience today than you will if you wait. So get out there and find your dream home!
Homes Ever Changing Market
Homes in our local real estate market is always changing. Compared with not so long ago, that’s a good thing. If you are ready to buy a home in today’s market, you need to take note of recent changes that may affect your buying power.Buying a home in our local market today is not just about finding one in the best condition in a great location for an affordable price. Smart home buyers today require a deeper knowledge of the economy, the local market and regulations. We can help you pinpoint all you need to know to make an educated move when buying a home.
Home prices, interest rates and fees are all top-of-mind when you’re figuring back-of-the-envelope costs. But do you know what guidelines are in place that can affect how much mortgage you can qualify for, what the local inventory of available homes is currently or if you can find funds to remodel a home down the road? When you’re ready to buy a home—or if you’re thinking of selling and want to understand what buyers are thinking in today’s market—keep reading to get a true picture of how to make a smart move today.
Individuals with families, either existing or planned for the future, should shop for homes with enough square footage to handle an entire family. Also, look at safety issues, such as a swimming pool or stairs. Purchasing a home from someone who raised their own children in it can give you some peace of mind about its safety for your own kids.
1. HOME PRICES & INVENTORY
Because a smaller number of homes are available for sale, home prices are rising and many homes are being sold at—or even above—list price. According to Lawrence Yun, chief economist at the National Association of REALTORS (NAR), existing-home sales are on target to exceed 2015’s pace. With more homebuyers seeking fewer homes, competition is heating up. If you find a home you love, act fast to put in a bid and we can help you craft the offer to look most attractive to the home seller.
The Internet can be your best friend when house hunting, so remember to use the net to check out homes and neighborhoods. There is a lot of info available on the Internet. Prior to buying a property, take a look at the surrounding area’s population, employment levels and median income in order to determine whether you find the region appealing and promising.
2. INTEREST RATES & BUYING POWER
Although interest rates have been running near historic lows for many months, if they rise it will affect how much home you can afford. Granted, rates won’t shoot up immediately, but even incremental changes will increase your costs…and reduce your buying power. Combine rising interest rates with increases in home prices, and your dream-home picture may have to be modified the longer you wait.
If you’re trying to buy commercial real estate that costs a lot, make sure you get a partner you can trust. It can make it way easier to get the loan you need. Having a partner is a great way to ensure that you have the necessary down payment amount as well as the creditworthiness required by commercial lenders.
3. BARGAINS & INVESTMENTS
If you’re looking for a steal that needs just a bit of sweat equity to fix up, you might be disappointed. The number of foreclosures, short sales and other distressed properties has been decreasing, and when foreclosures do appear, they are often bought up quickly and quietly by all-cash investors. If you’re looking for bargain or investment property, we can help you locate suitable properties, but the inventory may be tight.
When you are looking to make a great investment on your real estate, you should consider doing some repair and remodel work. This increases the value of your investment by boosting its resale value. Sometimes it will rise more than you have invested.
4. NEW CONSTRUCTION
With the improving economy, home builders are back in business offering brand-new homes. Don’t go it alone with the builder; get a real estate professional—like us—to represent your interests in the purchase.
The current economic climate makes now an ideal time to consider investing in real estate. Property values and interest rates are low in light of the recent housing market crash. This is a perfect time for first-time home buyers to get into a home, or for current home owners to invest in a larger property. The markets will go up again someday, so any investment you make will have returns.
5. UNDERSTANDING “MORTGAGESE”
Today, lenders require more documentation of your finances, but offer “qualified mortgages” with terms and rates that fit your budget and will not surprise you. Additionally, the Loan Estimate and Closing Disclosure forms outline each cost related to obtaining your home loan along with your monthly mortgage amount.
Write down all the important questions that you need to ask potential real estate agents. Ask about things that really matter to you. For example, you might ask if they have sold a lot of homes in your area of interest, and find out the number of homes they have sold during the past year. A reputable agent will definitely be able to answer all questions you have.
6. COMFORTABLE AFFORDABILITY
Lenders who provide “qualified mortgages” ensure that your total debt does not exceed 43% of your total income. Therefore, if you earn $75,000 per year, your total combined debt (mortgage, insurance, car loans, student loans, etc.) could not exceed a yearly total of $32,250. When divided by 12, this means your total monthly debt payments cannot exceed $2,687.50. This formula gives you a good indicator of whether your debt level is manageable, and you can afford to repay all your obligations.
Always have a home inspection prior to signing a mortgage. You don’t want to discover after you buy that your house needs a lot of renovating. An inspector will give you a good idea of how much renovations will cost you and how long they will take.
7. IMPROVING YOUR HOME
When the value of your home is greater than your mortgage, the difference is “home equity.” Lenders today will allow you to tap into this equity, once again allowing homeowners to remodel and refurbish their homes with a low-interest loan backed by the equity of their residence.
Try to buy houses that have fireplaces only in the family room. It can be aggravating to clean a bunch of fireplaces, especially if they’re rarely used.
8. THE PROS KNOW
Despite the challenges, today’s homebuyers are out and about, as in many markets it is more affordable to own than it is to rent. That makes now a great time to buy a home and perhaps a better time than you’re likely to see for many years to come. To take advantage of today’s market, and overcome any hurdles along the way, you’ll need someone like us on your side to work with you. Contact us when you—or someone you know—are ready to buy a home!
Home Buying-Bust Through
If you—or someone you know—is still on the fence about home buying today, don’t wait. We’ve heard lots of excuses in recent years. Not enough down payment? Credit score too low? Can’t qualify with a foreclosure (short sale, bankruptcy) history? Too much debt (especially, student debt)? Rates too high? Loans too expensive? Don’t know where to start?
All of these worries can be—and are—overcome with time and determination.
Don’t be walled in by old assumptions when it come to home buying. In this market with low rates and little down payment you owe it to yourself (or share this info with friends/family members) to discover exactly how to own a home.
With Oakland County seeing the lowest inventories in some time (as low as 4-6 months) it is time to be ready when your dream home finally hits the market. Home buying is process and once you start the process things will fall into place.
It isn’t difficult. All you need to do is take the first step to contact a local real estate pro—like us—or a mortgage lender (we can refer you to several top-notch options). The only thing holding you back is making that first contact. Keep reading. You may be surprised to learn the real truth behind the myths that stop many from homebuying in our local real estate market.
I don’t have any money for a down payment. Even if you don’t have a chunk of change lying around, you might have family—or friends—who are willing to give you money for a down payment. Get gift letters stating that the cash is a gift and doesn’t need to be repaid and your down payment problem is solved. Or, ask a relative to invest in the property as a co-owner. Your relative puts up the down payment. You make the monthly payments. You both split any profits at sale.
My credit score isn’t good enough. You don’t need a super-high credit score to buy a home. In October 2014, the average FICO score for all types of closed/settled loans was 726. For FHA loans that figure stood at 683.
Interest rates are too high. Historically speaking, interest rates on mortgages are still very low. The bad news is, rates will eventually rise and that could put homeownership out of reach—if you continue to wait to buy a home.
I have savings, but I still don’t have 20% to put down on a house. You don’t need a huge down payment to buy a home today. Sure, 20% is a great down payment, but you can still get a loan with 5% down for conventional loans and 3.5% down for FHA loans. Some new loan programs allow as little as 3% down again. Let us show you the new math.
I have too much student loan debt (or other debt). If your debt is manageable and you’re making monthly payments to lower it, you aren’t automatically disqualified from getting a home loan. Speak with a lender to determine how your income and debts compare and if there’s room in your budget for a mortgage payment.
Loans are too expensive. Lenders charge fees to originate and process your loan and fees vary. They are required by law, before you agree to a loan, to provide a Good Faith Estimate (GFE) of all their charges. Different loan programs have different costs, so compare loans—and lenders—to find out which fits your budget best.
I can’t afford to apply for a loan. Most lenders do not charge for “running the numbers” to determine if you can qualify for a mortgage. During pre-qualification, lenders use general figures you provide to present a rough estimate of how much home you can afford. Pre-approval, in which lenders determine exactly how much home you can afford based on specific information—such as tax documents, paystubs and bank information you provide. Pre-approval is also often provided with no obligation by many lenders. Take the first step. Find out what you qualify to buy—it won’t cost you much more than time.
I don’t know where to start. As your local real estate professionals, we make it our business to answer your home buying questions, help you determine if you are able to buy a home…and then find the right home for you. Contact us at any time. We would love to discuss your situation and find out if we can make you a happy homeowner!
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