Real Estate Market Forecast: Opportunities for Home Buyers and Sellers in 2024

 

A growing share of home buyers and sellers sat on the sidelines last year as the pace of home sales continued its downward trajectory.¹ In fact, since the Federal Reserve began its series of interest rate hikes in 2022, the combination of higher borrowing costs and record-high home prices has fostered the steepest real estate market slowdown since the 2008 recession.²

 

Priced out of the market, a generation of would-be buyers has been forced to delay their plans for homeownership.³  At the same time, current owners—reluctant to give up their pandemic-era mortgage rates—are waiting to sell, which has resulted in a sharp drop in listings.⁴

 

But there may be some relief in sight: In December, the Fed signaled that it was done raising interest rates—and suggested that it could cut rates by 0.75% over the coming year. While mortgages don’t directly follow the federal funds rate, they typically move in tandem—so cheaper home loans may finally be on the horizon.⁵

 

Lower mortgage rates should bring some much-needed movement back into the real estate sector. But with a market this fluid, the home buyers and sellers with an edge will be those who proactively leverage a real estate agent’s on-the-ground expertise and stay flexible so that they can quickly adapt to changes.

 

What does that mean for you? Read on to learn more about the current state of the U.S. housing market, the potential opportunities for buyers and sellers, and economists’ predictions for the year ahead.

 

 

HOME PRICES WILL REMAIN RELATIVELY STABLE

 

Not even 8% mortgage rates could bring home prices crashing down in 2023, as some prospective home buyers may have hoped. In fact, on average, U.S. property values ended the year higher—with declines in some areas of the country offset by appreciation in others.⁶

 

Prices typically fall when rising interest rates drive down demand. So what’s keeping home values high?

 

Mike Simonsen at Altos Research points to a nationwide housing shortage: “Declining home prices probably require that supply-and-demand imbalance, and what we have is really a balance. There’s a balance between low demand and low supply.”⁷

 

Analysts expect that equilibrium to continue to prop up home prices in 2024, although the specific forecasts vary. For example, economists at Realtor.com predict that the median home price will fall slightly, by 1.7%, while those at Fannie Mae project modest price growth of 2.8%.^6,8

 

However, experts widely agree: Mortgage rates will be the largest driver of property values. If rates fall faster than expected, more buyers will enter the market—which could send home prices soaring higher.

 

What does it mean for you?  There’s no evidence that home prices are headed for a major decline. So if you’re ready and able to afford a home, this is a great time to test the waters. The best bargains are often found in a slower market, like the one we’re experiencing right now. Contact us to discuss your goals and budget. We can help you make an informed decision about the right time to buy.

 

And if you’ve been waiting to sell your home, this could be your year. Price growth has slowed, so now is the time to maximize your equity gains while minimizing your competition. Contact us for recommendations and to find out what your home could sell for in today’s market.

 

 

MORTGAGE RATES SHOULD FINALLY TREND DOWN

 

The best news we’ve got incoming for 2024? The extra-high mortgage rates that have weighed heavily on the real estate market may finally be headed south.

 

At its December meeting, the Fed signaled that the worst is likely behind us and that it expects to cut its overnight rate in 2024. Analysts predict that mortgage rates will fall in lockstep.⁵

 

“Given inflation continues to decelerate and the Federal Reserve Board’s current expectations that they will lower the federal funds target rate next year, we likely will see a gradual thawing of the housing market in the new year,” said Freddie Mac’s Chief Economist Sam Khater following the announcement.⁹

 

The average 30-year fixed mortgage rate has already declined from an October high of around 8%, and analysts at Fannie Mae, the Mortgage Bankers Association, and Realtor.com all forecast that rates will trend down this year, ending 2024 closer to 6%.⁷

 

However, it’s not all good news: It appears that the days of 3% mortgage rates are firmly behind us. “As long as the economy continues to motor along, the new normal of higher rates is here to stay,” explains Greg McBride, chief financial analyst for Bankrate.⁴ So, when it comes to a home loan, borrowers may need to adjust their expectations.

 

What does it mean for you?  If you’re a prospective home buyer, declining mortgage rates could give you the opportunity to lock in a more affordable monthly payment. And if you purchase before the market reheats, you could secure an especially good deal. To find the lowest rate, it pays to compare lenders. Ask us to refer you to a mortgage broker who can help you shop around for the best option.

 

Sellers also have reason to celebrate buyers’ lower interest rates: As the barriers to entry to the housing market decline, they could enjoy more or better offers. Reach out to discuss how we can help you maximize your home’s sales potential.

 

 

LOWER RATES WILL BRING SOME BUYERS AND SELLERS BACK TO THE MARKET

 

Over the past couple of years, higher mortgage rates have cooled home buyer demand. They’ve also delayed the plans of many home sellers, who have been reluctant to trade in their current mortgages for loans that are several points higher.

 

With so many market participants playing the waiting game, the real estate sector has slowed significantly. National Association of Realtors (NAR) Chief Economist Lawrence Yun estimates that the number of existing home sales fell by 18% last year following a 17% decline in 2022.¹⁰

 

However, as financing costs tick down, sales volume is expected to rise. “Lower mortgage rates would help spur home sales activity, which [is] expected to increase in 2024 compared to 2023,” explains Selma Hepp, chief economist at CoreLogic. “Declines in mortgage rates will drive more sellers to trade their existing home and help add much-needed inventory to the market, leading to more transactions.”⁴

 

There’s also evidence that the patience of holdout home buyers may be waning, despite higher borrowing costs. A recent survey by Bank of America found that the number who are willing to wait for prices or mortgage rates to decline before making a purchase fell from 85% to 62% in just six months.¹¹

 

“When it comes down to it, if buying a home is your goal and within your budget, the best time to buy is when you’re ready financially and you can find a home that fits your needs,” Matt Vernon, head of consumer lending at Bank of America, advised in a recent release. “Even in the current interest rate environment, there are clear benefits to purchasing a home and beginning to build equity.”¹¹

 

What does it mean for you?  If you’ve been waiting to buy a home, you might want to consider purchasing before the competition picks up. Pent-up demand could bring a flood of buyers back into the market as mortgage rates decline. Contact us if you’re ready to begin your home search.

 

If you’re hoping to sell this year, you may also want to act fast. An increase in listings will make it harder for your home to stand out. We can help you chart the best course to maximize your profits, starting with a professional assessment of your home’s current market value. Reach out to schedule a free consultation.

 

 

THE HOUSING SUPPLY SHORTAGE WILL PERSIST

 

Will home buyers who are eager for options have more homes to choose from this year?

 

Yun thinks so. He believes sellers will soon grow weary of waiting to list. “Pent-up sellers cannot wait any longer. People will begin to say, ‘life goes on,’” the NAR economist speculated at a November conference. “Listings will steadily show up, and new home sales will continue to do well.”¹⁰

 

But not everyone agrees. Economists at Realtor.com forecast that inventory could drop by as much as 14% this year. The decline in existing homes for sale has been compounded by a persistent shortage of new construction, with single-family housing starts falling 10.3% in 2023 and 11.2% in 2022.⁶

 

Even so, newly-built homes are playing an increased role in easing the supply crunch, accounting for around one-third of all homes for sale in 2023—which was twice the historical average.¹² But new construction alone isn’t expected to fill the inventory gap.

 

According to First American Financial Corporation’s Chief Economist Mark Fleming, the U.S. currently has a shortfall of around one million homes, and conditions won’t ease until individual owners re-enter the market. “Only when more homeowners decide to sell, and then buy again, will housing supply and the pace of sales return to anything resembling normal.”¹³

 

​​What does it mean for you?  Inventory remains tight, but buyers can benefit from the search expertise of a real estate professional. We can tap our extensive network to access off-market and pre-market listings while helping you explore both new construction and existing homes in our area.

 

While sellers will continue to benefit from the low-inventory environment, they should be prepared to compete against brand-new homes. We can help you prep your property for the market and highlight the features most likely to appeal to today’s buyers.

 

 

WE’RE HERE TO GUIDE YOU

 

While national real estate forecasts can give you a “big picture” outlook, real estate is local. And as local market experts, we know what’s most likely to impact sales and drive home values in your neighborhood. As a trusted partner in your real estate journey, we’ll keep our ears to the ground so that we can guide you through the market’s twists and turns.

 

If you’re considering buying or selling a home in 2024, contact us now to schedule a free consultation. Let’s work together and craft an action plan to meet your real estate goals.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. CNN –
   https://www.cnn.com/2023/10/19/homes/existing-home-sales-september/index.html
2. Goldman Sachs –
   https://www.gspublishing.com/content/research/en/reports/2023/10/23/2d814362-a656-4cb3-8586-bea8591188e3.html
3. ABC News –
   https://abcnews.go.com/US/millennials-priced-homeownership-feeling-pressure/story?id=105032436
4. Bankrate –
   https://www.bankrate.com/real-estate/housing-market-2024/
5. CBS News –
   https://www.cbsnews.com/news/interest-rates-are-paused-heres-why-thats-good-news-for-homebuyers/
6. com –
   https://www.realtor.com/research/2024-national-housing-forecast
7. NerdWallet –
   https://www.nerdwallet.com/article/mortgages/2024-homebuying-trends-property-line-november-2023
8. Fast Company –
   https://www.fastcompany.com/90991612/home-price-2024-outlook-fannie-mae
9. Freddie Mac –
   https://freddiemac.gcs-web.com/news-releases/news-release-details/mortgage-rates-drop-below-seven-percent
10. National Association of Realtors –
    https://www.nar.realtor/newsroom/nar-chief-economist-lawrence-yun-forecasts-existing-home-sales-will-rise-by-15-percent-next-year
11. Bank of America –
    https://newsroom.bankofamerica.com/content/newsroom/press-releases/2023/12/bofa-report-shows-fewer-prospective-homebuyers-willing-to-wait-f.html
12. Marketplace –
    https://www.marketplace.org/2023/11/27/mortgage-rates-new-home-sales/
13. First American –
    https://blog.firstam.com/economics/whats-the-outlook-for-the-housing-market-in-2024

Celebrate Sustainably: 5 Ideas for an Eco-Friendly Holiday at Home

 

It’s the most wonderful time of the year. But for many families with festive plans and hectic schedules, it’s also the most wasteful.

 

According to one survey, for example, 60% of respondents admitted to throwing away more than usual during the holiday months as they filled up their trash bins with uneaten food, wrapping paper, gift bags, and commercial packaging.¹

 

The reality is, Americans routinely toss about 25% more trash between Thanksgiving and New Year’s than at any other time of year, according to the U.S. Environmental Protection Agency.² In fact, we throw away so much ribbon during the holidays—around 38,000 miles’ worth—that the discarded material could easily run more than one and a half times around the Earth.³

 

As our holiday schedules grow busier, many of us also forget to take simple steps at home to shrink our carbon footprints or prepare for a more energy-efficient winter.

 

Luckily, it’s not that hard to shift our habits and plan for a more sustainable and environmentally-friendly celebration. Here are five ideas for ringing in the holidays this year without overstressing Mother Nature.

 

 

1. PREP YOUR HOME FOR WINTER

 

Depending on the amount of time and resources you have available, you could cut your carbon emissions significantly this season just by winterizing your home.

 

Investing in a more sustainable way to warm up your surroundings—such as a geothermal heat pump or solar heating—could be especially impactful if your current HVAC is underperforming and you can afford a more expensive system.⁴ Replacing old appliances or things like chronically leaking windows with newer, more energy-efficient solutions can also save you money over the long term.⁵ Plus, you may be able to claim a federal energy-efficient tax credit for up to 30% of your investment.⁶

 

You don’t necessarily have to spend a lot upfront, though, to prep your home for winter. Even simple tweaks—such as sealing windows and doors or upgrading to more energy-efficient window coverings—can lower your energy consumption and reduce your carbon footprint.⁷

 

Incorporating environmentally healthier habits into your routine can also make a meaningful difference. According to the U.S. Department of Energy, for example, dialing back your thermostat by as little as seven to 10 degrees for eight hours a day can trim up to 10% from your bills.⁸

 

Consider a home energy assessment to help you pinpoint what needs fixing. Depending on your comfort level, you can audit your home’s energy efficiency yourself with the help of the Department of Energy’s DIY Guide.⁹ Or you can hire a professional, such as a home energy auditor or weatherization contractor.¹⁰ Call us for a recommendation or personal referral.

 

 

2. DECORATE SUSTAINABLY

 

Decking your home’s halls is one of the most jolly seasonal activities of all. There’s something special about gathering ’round with friends and family and relaxing in the comforting glow of a festively decorated space.

 

But since so much of the holiday-themed decor that’s sold in stores is notoriously disposable, it can be a challenge to spruce up your home sustainably. Cheaply produced and rarely recyclable, store-bought decorations are often made with plastic, styrofoam, and other environmentally unfriendly materials that can crowd landfills for generations.²

 

Luckily, you don’t have to trade style for sustainability when making your holiday decor. Thrifting is still in vogue, so consider crafting new and on-trend decorations out of secondhand finds or upcycling items already in your closet.

 

For example, you could transform an ill-fitting sweater into a holiday-themed pillow, turn teacups into candles, or turn leftover shipping boxes into creative decorations. Alternatively, natural decor foraged from your yard—such as dried leaves, flowers, pine cones, and branches—can make for especially beautiful wreaths and centerpieces.

 

If you do purchase store-bought decor, proactively look for the most environmentally friendly options. LED lights are now ubiquitous in stores and use far less energy than incandescent versions.¹¹ Similarly, if you celebrate with a Christmas tree, think twice about choosing an artificial option. Plastic trees may be reusable, but natural trees are generally thought to have a smaller carbon footprint.¹

 

 

3. CUT BACK ON HOLIDAY SHOPPING

 

Shopping online or at the mall may be convenient, but it can be costly for the environment. The greenhouse emissions from shipping and transportation alone add up fast, as do the emissions that are produced when an item is first made. According to the online consignment and thrift store, thredUp, 4.5 billion pounds of carbon emissions could be saved if every American bought just one used item instead of new this year.¹²

 

Splurging on brand-new products also makes it more likely that the gently used but still functional items that you’ve got at home will wind up in the trash.

 

Rather than buy new, check vintage stores and consignment shops for unique gifts that you and your recipient can both feel good about. According to research by thredUp, most people are open to receiving gently-used presents, especially if they’re socially-conscious members of Gen Z.¹² Alternatively, consider regifting items that you haven’t used, upcycling something you own, or try crafting gifts by hand.

 

Giving away special experiences, such as concert tickets or community memberships, may also be a more eco-friendly option. So is donating to a favorite charity in a gift recipient’s name or offering gifts of time, such as promising to help a loved one clean out their garage or fill their freezer with home-cooked meals.

 

Research shows that gift recipients often value thoughtful gifts with sentimental value, especially if they’re homemade or nostalgic or will provide them with a unique experience.¹³

 

And if you prefer to buy something tangible, look to local businesses that source or manufacture their goods nearby. Craft fairs and community markets are a great place to start. Or, give us a call and we’d be happy to share a list of our favorite local stores, depending on the type of gift and your budget. We make an effort to patronize the independently-owned shops and restaurants around town and would love to share our recommendations.

 

 

4. GREEN YOUR HOLIDAY DINNER

 

Do you hail from a family of passionate carnivores? If so, trading your meat for a vegetarian option may seem like a step too far—especially for a holiday dinner.

 

But swapping your meat for beans isn’t the only way to “’green” your holiday meal. For example, you can consciously source your meat from ethical sellers, prioritize local producers for seasonal sides, and serve enough filling vegetables to satisfy a large portion of your appetite.¹⁴

 

You can also minimize food waste by planning ahead so that you don’t cook more than necessary. Check out the Natural Resources Defense Council’s dinner party “Guest-Imator” to help you narrow down how much food you and your guests will actually need.¹⁵ In addition, consider using the USDA’s FoodKeeper App to help track safety recalls and set up calendar reminders for expired food.¹⁶

 

Once you’re finished eating, clear the table immediately and either freeze the leftovers you’d like to keep or send guests home with reusable containers. Or, if you have untouched food that’s still whole or in unopened packaging, take it to a local food bank or homeless shelter. We’d be happy to share a list of options in our area.

 

 

5. DONATE OR RECYCLE WHAT YOU CAN

 

Once the festivities are over, the real work on behalf of Mother Nature begins. This is the time when taking a few minutes at the end of your holiday celebration to swiftly collect wrapping paper and ribbons, unwanted packaging, and other discarded items can make a real environmental difference by reducing what you send to landfills. Your goal should be to reuse what you can and compost or recycle what’s left over.

 

For example, if you upgrade any electronic gadgets over the holidays, you can conserve resources and limit pollution by donating or properly recycling your old versions. The U.S. Geological Survey estimated that recycling a million laptop computers could help save the energy equivalent of 3,500 homes’ annual usage of electricity.¹⁶ Similarly, the EPA says that recycling one million phones can help salvage 35,000 pounds of copper, 772 pounds of silver, 75 pounds of gold, and 33 pounds of palladium.¹⁷

 

It can also help to reimagine new ways to make old traditions more eco-friendly. For instance, if lighting candles is part of your holiday celebration, consider choosing beeswax candles this year instead of the typical paraffin wax, which is a petroleum derivative. Not only are they cleaner burning and less toxic, but the leftover wax is biodegradable and can be composted, unlike traditional candle wax.¹⁸

 

There are also plenty of earth-friendly ways to dispose of a natural Christmas tree without kicking it to the curb. Trees that are sent to landfills release a potent greenhouse gas called methane.¹⁹ So, it’s important to properly dispose of a live tree, if you have one, so it can be recycled or composted. If you’re not sure how, reach out for a list of local options.

 

 

BOTTOMLINE

 

We can still celebrate a fun and festive season without draining our community’s resources or sending leftovers to the landfill. And remember, we’re here to lend a helping hand, now or in the new year. This is the perfect time to strategize your next move or set some real estate resolutions with personalized guidance from an expert. Reach out today to schedule a free consultation.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. Eco Watch –
   https://www.ecowatch.com/sustainable-decor-winter-holidays.html
2. Architectural Digest – https://www.architecturaldigest.com/story/best-holiday-and-seasonal-decor-for-the-environment
3. The New York Times –
   https://www.nytimes.com/2019/12/18/style/zero-waste-holiday.html
4. Environmental Protection Agency –
   https://www.epa.gov/burnwise/heat-pumps
5. S. Department of Energy – https://www.energy.gov/eere/buildings/articles/appliance-and-equipment-standards-fact-sheet
6. IRS –
   https://www.irs.gov/credits-deductions/energy-efficient-home-improvement-credit
7. Energy Star –
   https://www.energystar.gov/saveathome/seal_insulate/sealing_window_door
8. S. Department of Energy – https://www.energy.gov/energysaver/programmable-thermostats
9. S. Department of Energy –
   https://www.energy.gov/energysaver/do-it-yourself-home-energy-assessments
10. Kiplinger – https://www.kiplinger.com/slideshow/real-estate/t029-s001-12-ways-to-prepare-your-home-for-winter/index.html
11. S. Department of Energy – https://www.energy.gov/energysaver/articles/reduce-waste-and-save-energy-holiday-season#
12. Thred Up – https://newsroom.thredup.com/news/thredup-releases-thrift-for-the-holidays-report-revealing-that-new-waves-of-consumers-are-planning-to-gift-secondhand-this-year
13. The Conversation – https://theconversation.com/the-4-biggest-gift-giving-mistakes-according-to-a-consumer-psychologist-195169
14. Popular Science –
    https://www.popsci.com/story/diy/sustainable-holiday-strategies/
15. Natural Resources Defense Council –
    https://savethefood.com/guestimator
16. USDA –
    https://www.usda.gov/media/blog/2018/10/04/usda-updates-foodkeeper-app-include-new-food-items
17. S. Environmental Protection Agency –
    https://www.epa.gov/recycle/electronics-donation-and-recycling
18. com –
    https://canicompostit.com/candle-wax/
19. CNN –
    https://www.cnn.com/2022/11/25/us/real-or-artificial-christmas-tree-climate/index.html

 

35 Tips to Furnish Your New Home for Less

 

 

Buying a new home is one of the most exciting experiences in life. And if you’re like most homebuyers, you’ll be planning your furniture placement and decor before the ink dries on your offer letter.

 

But before you run to the nearest home goods store, take a deep breath. First, you’ll need to delay any major purchases before you close on your new home. A large outlay or additional line of credit could lower your credit score and, thus, impact your mortgage terms.¹ Second, moving and closing costs can add up quickly, so it’s important to be strategic with your remaining budget.

 

But don’t worry! There are plenty of ways to save on home essentials, and we’ve rounded up some of our favorites to share with you.

 

 

PRIORITIZE WHAT YOU REALLY NEED BEFORE YOU START SHOPPING

 

According to Home Advisor, the national average cost to furnish a new house is $16,000, but it can easily soar higher.²  That’s why we recommend starting with a thorough assessment of what you already have and what you actually need to start life in your new place. Here are some steps to help you prioritize your purchases and keep spending in check.

 

• Make a list of everything you need. Going room by room could help you brainstorm—for example, you might list items ranging from a mattress to blackout curtains for your new primary bedroom.

 

• Inventory what you already have. Cross the big (dining table) to the small (kitchen knives) off your list as you go.

 

• Divide the remaining items into three groups: things you need right away (a mattress), items you’d like to have in the near future (a coffee table for your living room), and pieces that can wait (an area rug).

 

• Calculate your budget. Figure out how much money you’ll have available for immediate purchases after the sale has closed, and start researching the items on your priority list to understand how they’ll fit into your budget.

 

• Don’t rush the process. Bringing older items to your new space doesn’t mean you need to keep them forever. Consider hanging onto pieces that can tide you over for a year or two until your bank account has recovered from the costs of a home purchase.

 

Before you start shopping, make sure you know which appliances and fixtures are included with your home purchase. We can inform you of the standard contract terms when you’re making an initial offer and note any additional items that you would like to request.

 

 

TIME YOUR PURCHASES TO MAKE THE MOST OF SEASONAL SALES

 

Did you know that some home items predictably go on sale at certain times of the year? If you can wait to buy these pieces when prices are lower, you could save significantly. Here are some of the best times to buy household essentials:^3,4

 

• Bedding and linens: January
• TVs: Black Friday/Cyber Monday and late January (before the Super Bowl)
• Furniture: February and August, as well as Black Friday, Memorial Day, and Labor Day
• Large appliances: Labor Day through October
• Small kitchen appliances: May
• Mattresses: Holiday weekends, especially Memorial Day, Labor Day, and 4th of July
• Vacuum cleaners: April
• Tools: June
• Outdoor furniture: August through October

 

Generally speaking, holiday weekends (as well as Black Friday and Cyber Monday) tend to be great times to find deals. If the item you’re looking for is seasonal—like patio furniture or holiday decorations—waiting until the end of that season usually pays off.

 

 

FIND ALTERNATIVE SHOPPING SOURCES

 

Can’t wait for a sale? It’s time to think outside of the box (the big-box stores, that is). There are plenty of surprising places to find great furniture and houseware deals.

 

• Check out overstock and liquidation stores. These stores purchase items other retailers haven’t sold and offer them at a steep discount. The inventory can be hit or miss, but you can often get a great deal if you find what you’re looking for.⁵

 

• Try private membership/warehouse stores. Retailers like Costco and Sam’s Club often have great deals on home goods. If you’re not already a member, ask family or friends if they are willing to take you to look around before you commit.

 

• Consider open-box items. When buyers return items like furniture or electronics, retailers can’t always sell them as new, even if they haven’t truly been used. Look online for open-box deals from retailers like Wayfair and Amazon Warehouse or visit local retailers to see what they have in stock.

 

• Give scratch-and-dent appliances a chance. These appliances are brand new but sold at deep discounts because their external packaging was damaged. Typically, this means that flaws are purely cosmetic—but it’s always possible that the merchandise has suffered more serious damage. So, be sure to check out the appliances carefully and ask about included warranties.⁶

 

• Expand your window treatment search. Window treatments can be surprisingly expensive, but it’s often possible to save by buying off-the-shelf offerings in standard sizes. If you need a custom size or material, consider ordering online from a discount supplier and installing them yourself.

 

• Shop secondhand. In addition to thrift stores and garage sales, Facebook Marketplace, NextDoor, and Craigslist are all great places to find deals in your area.

Are alternative shopping sources still a stretch for your budget? Check out local Freecycle or “Buy Nothing” groups, which are often hosted on Facebook. Participants offer big and small items they no longer need—everything from furniture to clothing hangers—for free to other members.^7,8

 

 

DON’T BE AFRAID TO NEGOTIATE FOR A BETTER DEAL

 

Many people don’t realize that prices for home goods, from furniture to appliances, are often negotiable. While asking for a discount can be intimidating, it’s common practice in many industries, although more so at independently-owned stores than chains. Here are a few tips:^9,10

 

• Comparison shop before you walk into a store. If you can find a lower price for the same item elsewhere, many retailers will match it.

 

• Ask the store associate or manager for the best price available. They may be able to offer additional discounts or coupons.

 

• If you can pay in cash, ask if you can get a discount for doing so. The seller may be happy to offer a small price reduction to avoid paying processor fees.

 

• Call ahead to ask about applicable discounts. Some retailers offer price reductions for active military, veterans, teachers, first responders, or senior citizens on certain days or times of the year.

 

• Point out scratches or dings to the sales associate. They may be willing to offer a discount to compensate for the imperfection.

 

• Ask about floor models. Many stores offer these pieces at a lower price, even if they’re in like-new condition.

 

After you’ve negotiated a killer deal, don’t forget to ask for free or discounted delivery! Sometimes furniture and appliance stores will offer complimentary delivery or installation if you spend a certain amount or purchase multiple items.

 

 

MAKE THE MOST OF REWARD PROGRAMS AND COUPONS

 

Every penny counts when you’re on a budget—and spending a little extra time maximizing reward programs and discounts is usually worthwhile.

 

• Sign up for a change of address kit with the United States Postal Service. You’ll need to do anyways to forward mail to your new address, and it comes packed with valuable coupons.11

• Make sure you never miss a sale. Sign up for your favorite retailers’ email lists and follow them on social media for discounts and sale alerts.
• Take advantage of loyalty programs. If you’re making a big purchase or getting multiple items from one store, ask about free loyalty programs. Signing up often comes with an introductory coupon.
• Consider store credit cards (carefully). Store credit cards can offer significant discounts—but only charge items you can pay off right away to avoid interest, and never open new lines of credit until your home purchase is complete, since it can affect your credit score.
• Enroll in coupon and cashback programs. When you’re shopping online, programs like Rakuten and Honey can help you find coupon codes and give you cash back on purchases.

 

While you’re at it, why not set up a housewarming registry?¹²  You can share the link with family and friends if they ask what you need—and you can also use it to score discounts. Many stores offer a percentage off to help you buy unpurchased items on your registry.

 

 

GET CREATIVE

 

If you want to avoid a cookie-cutter home aesthetic—and save a few bucks—try reimagining your existing furniture and how it could fit into your new space. Here are a few of our favorite strategies.

 

• Repurpose what you have. Instead of buying a new item to fit a specific purpose, ask yourself if you can use what you have in a different way. For example, repurpose an old dresser as a television stand or use a mismatched dining chair in your home office.

 

• Upgrade existing items. Sometimes, a new coat of paint or varnish, or simply swapping out drawer pulls and handles, can lend a new lease on life to an old piece of furniture. You can also keep this strategy in mind if you see second-hand items that would be just right if they were a different color or had nicer fixtures.

 

• Reupholster instead of buying new. If you have a tired-looking sofa or chair that’s still comfortable and stable, think about getting it reupholstered in new fabric instead of replacing it.

 

• Get handy. Building furniture is certainly not for everyone, but with some basic tools and help from the internet, you may find that simple items like headboards are well within your grasp. You might also be able to repair pieces you already have and avoid shopping altogether.

 

Do-it-yourself projects can be fun, but they aren’t for everyone. If you’d like some professional help, reach out for a list of our recommended service providers.

 

 

WE’RE HERE TO HELP

 

We know budgeting for a new home can be overwhelming, and we want to make the process easier for you. If you’re considering a home purchase, we can advise you on a realistic budget and help you review your options. We can also offer insights on other financial considerations and programs and incentives that can help make homeownership more attainable. Reach out for a free consultation.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

 

Sources:

1. Bankrate –
   https://www.bankrate.com/mortgages/avoid-mortgage-closing-missteps/
2. Furniture Bank –
   https://www.furniturebank.org/how-much-does-it-cost-to-furnish-an-apartment/
3. US News –
   https://money.usnews.com/money/personal-finance/saving-and-budgeting/articles/the-best-time-of-year-to-buy-everything
4. NerdWallet –
   https://www.nerdwallet.com/article/finance/wht-to-buy-every-month
5. Business Insider –
   https://www.businessinsider.com/personal-finance/strategies-to-save-money-on-furniture-for-my-new-home?r=US&IR=T
6. CNET –
   https://www.cnet.com/home/kitchen-and-household/buy-scratch-and-dent-appliances/
7. Real Simple –
   https://www.realsimple.com/home-organizing/green-living/buy-nothing-groups
8. Freecycle –
   https://www.freecycle.org/
9. Consumer Reports –
   https://www.consumerreports.org/cro/magazine/2013/08/how-to-bargain/index.htm
10. com –
    https://www.realtor.com/advice/home-improvement/furniture-stores-money-saving-tricks/
11. The Krazy Coupon Lady –
    https://thekrazycouponlady.com/tips/money/usps-moving-coupons
12. Taste of Home –
    https://www.tasteofhome.com/article/housewarming-registry/

 

Income Properties Are Trending, But Is Landlord Life for You?

 

If the thought of investing your money into brick and mortar—or perhaps some stylishly-painted siding—excites you, join the club.

 

Investing in real estate has long been one of Americans’ favorite ways to grow their wealth. In fact, over 70% of single-family rental properties are currently owned by individual investors rather than corporations, according to Census data.¹

 

Moreover, a decade’s worth of Bankrate surveys has found that Americans often prefer real estate for long-term wealth building over other investments. According to Bankrate’s latest survey, for example, Americans have historically embraced real estate, in part, because of the strong return on investment it can offer—especially to investors willing to stick with a property over time.² It’s also a popular way to hedge against inflation since both rental income and property values tend to rise in tandem with overall prices.³

 

Now, as higher interest rates continue to push priced-out homebuyers to the sidelines, a new crop of “mom and pop” investors are eyeing the mushrooming rental market as a potential goldmine.⁴ Interest in buying a home to both live in and rent is also on the rise, especially amongst cash-strapped buyers looking to supplement their mortgage payments.⁵

 

But how do you know if you’re well-suited to take advantage of these real estate investment opportunities? Here are three signs that owning a rental property could be right for you.

 

 

1. YOU’RE A HOMEBUYER WHO WANTS HELP COVERING THE MORTGAGE

 

If you’re looking for a creative way to buy a home without overspending, “house hacking” could be the answer. Increasingly popular with first-time homebuyers and budget-conscious investors, house hacking simply means buying a home that you intend to live in while renting out a portion of it to one or more tenants.⁵

 

House hacking also tends to be easier to break into than traditional real estate investing since you don’t need as high a credit score or as large a down payment to qualify for a mortgage. In fact, some government-backed mortgage programs will let you buy a primary residence with little to no money down.⁶ Buying a home you don’t plan to live in, by contrast, may require you to put down as much as 15% to 25% to qualify for a loan.⁷

 

If you house hack, the money you collect for rent each month can help cover your mortgage and other homeownership expenses. Depending on your setup, you may also be able to save on utility bills by splitting them with your tenant or tacking a portion onto their monthly rent. Another major advantage of house hacking is that it entitles you to certain tax benefits and deductions available only to landlords.⁸

 

When it’s time to start your search, we can help you find a property that’s ideal for house hacking, such as a house with a walkout basement, a multifamily unit, or a home with enough outdoor space to build an accessory dwelling unit or garage apartment.

 

 

2. YOU’RE AN INVESTOR LOOKING FOR STEADY AND RELIABLE INCOME

 

If you’re not crazy about the idea of a live-in tenant but still desire an additional stream of income, a dedicated long-term rental property could be a better option for you. Besides the monthly proceeds, purchasing a rental home can also add diversity and long-term stability to your investment portfolio and help you build wealth over time.⁹

 

According to data from the Federal Reserve, real estate owners have historically prospered. In early 2020, for example, the median home was worth almost triple what it was 30 years prior. Then, during the pandemic-era real estate boom, average home prices grew at an especially frenzied clip, climbing by nearly 50%, on average, in just two and a half years.¹⁰

 

However, the rate of appreciation can be hard to predict, so it’s prudent to invest in a property that also offers positive cash flow, which means the rent you take in exceeds your expenses. This strategy helps to ensure that you’ll put money in your pocket each month, even if the property’s value takes time to grow.

 

While today’s higher mortgage rates can make it more challenging for landlords to turn a profit, investment opportunities aren’t reserved for cash buyers. In fact, currently, almost 60% of real estate investors take out a loan to finance their purchase, according to Thomas Malone, an economist at the real estate data firm CoreLogic.⁴  He also notes that more small investors are stepping in to meet demand for rental housing, which has grown since many would-be buyers remain priced out of the purchase market.⁴

 

If you want to explore opportunities for a residential rental property that’s good for your wallet and attractive to renters, we can help. Reach out with questions or to schedule a free consultation.

 

 

3. YOU’RE AN EXPERIENCED INVESTOR LOOKING TO MAXIMIZE YOUR POTENTIAL RETURNS

 

Another increasingly popular way to draw income from an investment property is to convert it to a short-term vacation rental. But beware: This strategy can be riskier as some municipalities have tightened rental restrictions and others are suffering from market oversaturation.^11,12

 

With that said, if you’re an experienced investor who can afford to take on some uncertainty, then investing in a short-term rental could make sense for you.

 

If you find the right property, for example, you could earn significantly more renting it short-term on a platform like Airbnb than if you rented the home to a long-term tenant.¹¹

 

The key is to keep it occupied as much as possible at a premium nightly rate. To do that, you’ll need some marketing savvy, hospitality skills, and business acumen. Of course, you can always hire a professional property manager, but you’ll need to factor the cost into your budget.

 

The vacation rental market enjoyed a boom during the pandemic, and some inexperienced investors are finding they bit off more than they can chew. As a result, there’s an opportunity to snap up some of these properties, but you’ll need some cash on hand and a willingness to learn the business.¹²

 

We can help you scout opportunities in our local market or, if you’re interested in investing in another area, we can refer you to an agent there for assistance.

 

 

BOTTOMLINE

 

Investing in real estate can be a great way to build your wealth long-term and earn some extra income. But to make the most of your investment, it pays to be strategic.

 

Call us for a consultation so we can discuss your goals and budget. We’ll help you discover neighborhoods with the best income potential, point out the homes most suited to renting, and help you brainstorm the best investment strategy for you.

 

 

Before you take the plunge, make sure you can answer “YES” to these three questions:     Are you ready to be a landlord?   Owning a rental property can take a lot of time and energy. You’re not just buying passive income, you’re also building sweat equity since the time you spend maintaining, marketing, and managing your rental can add up quickly. So be prepared to do some soul-searching to ensure you’ll not only flourish as a landlord, but actually enjoy it.   If you want to invest in real estate but aren’t prepared to put in the day-to-day effort required, we can refer you to a property management service for help.   Can you afford to invest in real estate?   The last thing you want is to get over-extended with your new real estate venture. Besides the cost of purchasing the property, you’ll need to consider additional expenses, like property taxes, insurance, administrative costs, and maintenance and repairs. You will also need a cash reserve for unexpected issues or potential vacancies.   We can help you run the numbers to determine whether you can charge enough rent to offset your expenditures.   Have you found the right income property? Even if you’ve got your finances in order and are emotionally ready to invest, your success as a landlord will also depend on the property you buy. The criteria for a good rental home and a good family home are often different, so it’s important to lean on professionals for advice.   We can help you find an ideal rental property, taking into account your budget, risk appetite, and investment goals. If you decide to invest in a different area, we’ll connect you with an agent who’s more plugged into that community. Reach out today to schedule a free consultation.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

 

1. PR Newswire – https://www.prnewswire.com/news-releases/census-data-show-individuals-continue-to-own-largest-share-of-single-family-rental-homes-301725024.html
2. Bankrate –
   https://www.bankrate.com/investing/survey-favorite-long-term-investment-2022/
3. Forbes –
   https://www.forbes.com/sites/forbesbusinesscouncil/2022/04/14/why-income-generating-real-estate-is-the-best-hedge-against-inflation/?sh=1081ce921746
4. MarketWatch –
   https://www.msn.com/en-us/money/realestate/another-challenge-for-homebuyers-more-investors-are-snapping-up-homes-and-40-of-them-are-using-cash/ar-AA1foWSB
5. com – https://www.realtor.com/advice/buy/on-the-house-house-hacking-your-way-into-your-first-home/
6. NerdWallet –
   https://www.nerdwallet.com/article/mortgages/government-home-loans
7. LendingTree –
   https://www.lendingtree.com/home/mortgage/down-payment-for-rental-property/
8. Quicken Loans –
   https://www.quickenloans.com/learn/house-hacking
9. Investors Business Daily – https://www.investors.com/etfs-and-funds/personal-finance/rental-properties-investing-experts/
10. Louis Fed FRED Economic Data –
    https://fred.stlouisfed.org/series/MSPUS
11. Story by J.P. Morgan – https://story.jpmorgan.com/real-estate-news/thinking-about-investing-in-short-term-rentals-heres-what-to-know
12. Skift –
    https://skift.com/2023/07/21/short-term-rental-saturation-leads-to-a-correction-and-lots-of-home-sales/

Top 7 Tips To Attract the Best Offers for Your Home

 

Not long ago, home sellers were in their heyday, as historically-low mortgage rates triggered a real estate buying frenzy. However, the Federal Reserve shut down the party when it began raising interest rates last year.¹

 

Now, it’s not as simple to sell a home. While pandemic-era homebuyers were racing the clock—trying to lock in a low mortgage rate and gain a foothold in the market—current buyers are more discerning. Higher prices and mortgage rates have pushed their limits of affordability, leading them to prioritize cost, condition, and overall value.²

 

The reality is, home inventory remains low, so most properties will still sell with some basic prep, the right price, and a good real estate agent. But owners who go the extra mile are more likely to sell faster and for a higher amount.

 

If you have plans to sell your home and want to net the most money possible, this list is for you. Here are our top seven strategies to attract the best offers and maximize your real estate returns.

 

 

1. UNDERGO A PRE-LISTING INSPECTION

 

Many homebuyers hire a professional to complete a home inspection before they close. But did you know that a seller can order their own inspection, known as a pre-listing inspection, before they put their home on the market?

 

Having a pre-listing inspection on hand and ready to share shows interested buyers that you’re committed to a transparent transaction. This can help you market your home, strengthen your negotiating position, and minimize roadblocks to closing.³

 

Of course, it’s always possible that a pre-listing inspection—which looks at the home’s major systems and structures, among other things—could turn up a significant problem. This does carry some risk, as you’ll be required to either fix or disclose any issues to potential buyers. However, in most cases, it’s better to know about and address deficiencies upfront than to find out mid-transaction, when it could cost you more in the form of concessions, a delayed closing, or a canceled sale.

 

We can help you decide if a pre-listing inspection is right for you. And if it identifies any concerns, we can advise on which items need attention before you list your home.

 

 

1. CONSIDER STRATEGIC UPGRADES

 

Embarking on major renovations before putting your home on the market doesn’t always make financial (or logistical) sense. However, certain upgrades are more likely to pay off and can help elevate your home in the eyes of buyers.

 

For example, refinishing hardwood floors results in an average 147% return on investment at resale and new garage doors typically pay for themselves.⁴  Similarly, research shows that professional landscaping can boost a home’s value by as much as 20%.⁵

 

Often, even simpler and less expensive fixes can make a big difference in how your home comes across to buyers. A fresh coat of paint in a neutral color, modern light fixtures and hardware, and new caulk around the tub or shower can help your property look its best.⁵ 

 

But before you make any changes to your home, reach out. We know what buyers in your neighborhood are looking for and can help you decide if a particular investment is worthwhile.

 

 

1. HIRE A HOME STAGER

 

To get standout offers, you need potential buyers to fall in love with your home—and they’re much more likely to do so if they can envision themselves in the space.

 

That’s where home staging comes in. Staging can include everything from decluttering and packing away personal items to bringing in neutral furniture and accessories for showings and open houses.

 

According to the National Association of Realtors, home staging can both increase the dollar value of home offers and help a property sell faster. In fact, 53% of seller’s agents agree that staging decreases the amount of time a home spends on the market, and 44% of buyer’s agents see higher offers for staged homes.⁶

 

There’s plenty of strategy and research behind the process, so it’s smart to consider a professional. Reach out for a connection to one of our recommended home stagers who can help your property show its full potential.

 

 

1. EMPLOY A COMPETITIVE PRICING STRATEGY

 

While it’s tempting to list your property at the highest possible price, that approach can backfire. Homes that are overpriced tend to sit on the market, which can drive away potential buyers—and drive down offers.⁷ 

 

Alternatively, if you price your home competitively, which is either at or slightly below market value, it can be among the nicest that buyers see within their budgets. This can ultimately lead to a higher sales price and fewer concessions.

 

To help you list at the right price, we will do a comparative market analysis, or CMA. This integral piece of research will help us determine an ideal listing price based on the amount that comparable properties have recently sold for in your neighborhood.

 

Without this data, you risk pricing your home too high (and getting no offers) or too low (and leaving money on the table). Combined with our local market insights, we’ll help you find that sweet spot that will attract the best offers while maximizing your profit margin.

 

 

1. OFFER BUYER INCENTIVES

 

Sometimes, sweetening the deal with buyer incentives can help you get the best possible offer. Incentives are especially helpful in the current market, when many buyers are struggling with affordability and concerned about their monthly payments.

 

Options that can pay off include:

• Buying down their interest rate – You can pay an upfront sum to reduce the buyer’s mortgage rate. This approach can save far more than that cost over the life of the loan, meaning it’s worth more to the buyer than a simple price reduction.⁸
• Offering closing cost credits – You might pay a set amount or a certain percentage of the buyer’s closing costs.
• Paying HOA costs – You could cover homeowner association or condominium fees for a set period of time.
• Including furniture or appliances in the sale – If your buyer is interested, throwing in the furniture or appliances that they want and need can make your property more appealing.

 

Buyer incentives vary and valuing them can get complicated. We’re happy to talk through the options that might make sense for you.

 

 

1. USE A PROVEN PROPERTY MARKETING PLAN

 

Gone are the days when it was enough to put a “for sale” sign in your yard and place a listing on the MLS. A strategic marketing plan is now essential to get your home in front of as many interested and qualified buyers as possible.

 

The truth is, buyers who don’t know about your house can’t make an offer. That’s why we utilize a multi-step approach to marketing that starts with identifying your target audience, effectively positioning your home in the market, and communicating its unique value. We then use a variety of distribution channels to connect with potential buyers and performance-based metrics to monitor and improve our campaign results.

 

Our proven approach can have a big impact on the success of your sale. Reach out to learn more about our multi-step marketing plan and discuss how we can use it to generate interest and offers for your home.

 

 

1. WORK WITH AN AGENT WHO UNDERSTANDS YOUR AREA

 

To get the best offers possible, you need a real estate agent who knows your area inside and out.

 

Any agent can pull comparable sales data, but in a quickly-evolving market, even the latest comps can lag the current market reality. We have our fingers on the pulse of the local market because we’re working directly with sellers like you. We also represent local buyers who are active in the market, searching for homes like yours.

 

That puts us in an ideal position to help you price your home for a quick sale and maximum profit. And since we hear first-hand what local buyers want, we can help you prep your home to broaden its appeal and highlight its most-coveted features. Additionally, we can use our extensive network of local agents to solicit feedback and get your home in front of more potential buyers.

 

All of these factors can add up to a significant difference in your profit: In 2021, the typical home sold by owner went for $225,000 compared to a median price of $330,000 for agent-assisted home sales.⁹

 

 

LET’S GET MOVING

 

Are you ready to get a great offer for your home? Our multifaceted approach can help you maximize your real estate returns. Reach out for a free home value assessment and customized sales plan to get started!

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. S. Bank –
   https://www.usbank.com/investing/financial-perspectives/investing-insights/interest-rates-impact-on-housing-market.html
2. National Association of Realtors –
   https://www.nar.realtor/sites/default/files/documents/2023-home-buyers-and-sellers-generational-trends-report-03-28-2023.pdf
3. Bankrate –
   https://www.bankrate.com/real-estate/prelisting-inspection/
4. National Association of Realtors –
   https://www.nar.realtor/sites/default/files/documents/2022-remodeling-impact-report-04-19-2022.pdf
5. Bankrate –
   https://www.bankrate.com/homeownership/landscaping-increase-home-value/
6. National Association of Realtors –
   https://www.nar.realtor/infographics/staged-for-success
7. The Balance –
   https://www.thebalancemoney.com/looking-twice-at-overpriced-homes-1798671
8. S. News & World Report –
   https://money.usnews.com/loans/mortgages/articles/a-guide-to-seller-paid-mortgage-rate-buydowns
9. National Association of Realtors –
   https://www.nar.realtor/research-and-statistics/quick-real-estate-statistics

7 Common Homebuyer Regrets (And How To Avoid Them)

 

To avoid buyer’s remorse, be sure to consider your future self when shopping for a home.

 

Most new homebuyers don’t regret becoming homeowners. In fact, according to a survey by LendingTree, 80% of recent buyers who successfully overcame a challenging housing market say they’re glad they found their current homes.¹ But that doesn’t mean newly-minted homeowners don’t have any regrets about their buying choices.

 

On the contrary, research shows that even the most-satisfied homeowners would change some aspects of their home purchase if given the opportunity. According to a recent survey by Anytime Estimate, nearly 3 out of 4 buyers who purchased a home in 2021 or 2022 still have a few regrets.²

 

Some question their decision to move to a neighborhood they still don’t love. Others wish they had been less picky about where they lived so they could have paid less. Many are afraid they overspent or think they sacrificed too much in their rush to buy a home.

 

Here are some of the most common homebuyer regrets we see, along with our professional advice on how to avoid them.

 

 

REGRET #1: Spending More Than Necessary

 

No one wants to overpay for their new home purchase (and, luckily, with the right guidance, doing so is avoidable). But even if you’ve secured a winning purchase price, there are still plenty of ways to accidentally overspend.

 

One of the most common ways to overpay? Choose the wrong mortgage. In fact, in today’s higher-rate environment, this can be one of the riskiest mistakes a new buyer can make.

 

According to a recent survey, for example, nearly three-quarters of homebuyers leave money on the table by not bothering to shop around for the best rate.³ And research by LendingTree suggests that buyers in major metro areas lose an average of $63,151 over the life of their loan just by picking the first mortgage they’re offered.⁴

 

Lesson Learned:  As long as you stick to what you can afford, buying a home can be a boon for your financial health. The longer you live in it, for example, the more your home is likely to appreciate in value and boost your long-term savings.

 

But to get the most value from your purchase, it’s worth your time to compare financing options and shop around for the best deal. We also recommend getting a mortgage pre-approval before you start your home search so you know what’s within reach. We can refer you to one of our trusted lending partners for help.

 

 

REGRET #2: Rushing Into a Home Purchase

 

In a competitive housing market, it’s often necessary to act fast to secure a home. But don’t let a need for speed tempt you into making an offer before you’ve thought through or fully vetted a new property.

 

Rushing into a home purchase isn’t just risky, it’s also one of the most commonly cited sources of homebuyer regret. According to Anytime Estimate, for example, more than 1 in 4 homebuyers felt remorse over how quickly they sped through the home buying process.²

 

Getting swept away by your emotions can also lead to buyer’s remorse. If you’ve found a home you love and are competing with other buyers, it can be tempting to overlook key details or bid more than you can afford. That’s one reason it helps to have a skilled professional by your side to calmly guide you through the process and ensure you act with reason, rather than emotion.

 

Lesson Learned:  Buying a home is exciting. But if you don’t keep your emotions in check or act too impulsively, you could make poor choices in the moment that are hard to undo later.

 

To avoid making last-minute decisions that could backfire, know what you want, what you need, and what you can afford before you start your home search. We can help you set priorities so you’ll be able to move forward with confidence when the time is right.

 

 

REGRET #3: Miscalculating the Costs of Homeownership

 

Though real estate is a great long-term investment, it can be pricey in the short-term, often surprising homeowners who aren’t prepared for it. According to some estimates, for example, annual maintenance could cost as much as 1% or more of your home’s purchase price.⁵ Some buyers also forget to factor in additional ownership expenses, such as property taxes, insurance, and repairs.

 

Failing to think through the costs of homeownership is one of the most common sources of homebuyer regret. According to Anytime Estimate, for example, nearly half of the homebuyers who regret their purchase said they underestimated how much they would spend to live in it.²

 

However, some homes cost more to live in and maintain than others. So even if you’re certain that you can afford the average cost of homeownership, that doesn’t necessarily mean that every home in your price range will fit neatly into your budget. For example, very old homes with unique maintenance requirements could be extra pricey to keep up. Similarly, homes with high HOA or condo fees could also eat into your monthly budget.

 

Lesson Learned:  A home should help you build your wealth, not drain it. So it’s important to factor in all the potential costs of living in a home—not just obvious ones like your mortgage payment and taxes. To ensure you don’t get overextended, add up your estimated maintenance and repair costs, as well as any miscellaneous expenses that are unique to a particular home.

 

We can help you with these estimates—and, if needed, present you with some less-costly alternatives.

 

 

REGRET #4: Underestimating the Time Required To Maintain or Renovate a Home

 

One of the most joyful aspects of homeownership is getting to relax in a home that’s all your own. But if a home is too high maintenance, then you may not have time to savor it.

 

Many homeowners love to spend their weekends puttering in their gardens or undertaking home improvement projects. But if that’s not you, then you may not like living in a home with a big yard or with high-maintenance features, like a pool.

 

According to a survey by Hippo, for example, 47% of homeowners who feel some regret about their home purchase complain that too much maintenance and upkeep is required.⁶

 

Similarly, buyers who purchase fixer-uppers are often surprised by how much time it takes to rehab their new homes. Although buying a fixer-upper is a great way to save on the purchase price, you could come to resent it if it eats up all your free time.

 

Lesson Learned:  Renovation and maintenance projects are often time-consuming and stressful. So beware of committing to a property that requires too much of your attention if you don’t have the time or patience for it. With that said, home improvement projects can also bring a lot of joy and satisfaction to owners who like rolling up their sleeves.

 

We can talk through the realities of homeownership with you and help you choose a property that will fit your personality and schedule.

 

 

REGRET #5: Ignoring or Skipping a Home Inspection

 

It’s easy to get swept up in the excitement of buying a home. Sometimes, buyers will agree to skip a home inspection to sweeten their offer in a competitive market. They may also be tempted to pinch pennies since they’re already facing a large outlay. However, if you skip out on a home inspection, you could come to regret it.

 

When you hire a home inspector, you get a professional, in-depth examination of the property’s structures and systems before you buy it. It’s a worthwhile investment that can save you money in the long run, either by warning you away from a bad purchase or by providing a list of deficiencies you can use to negotiate with the sellers.

 

But even the most thorough home inspection isn’t going to be worth much if you don’t take the time to carefully consider it. If at all possible, make sure you’re on-site during the inspection so you can observe and ask questions. And don’t forget to re-evaluate any repairs that the seller agrees to make to ensure they’ve been properly completed prior to closing.

 

Lesson Learned:  A home inspection can reduce your risk and save you money in the long run. But to maximize its effectiveness, you will need to be an active participant in the process.

 

We’d be happy to share a list of experienced and trustworthy home inspectors in our area. And when the inspection report is complete, we can help you decide if the purchase is worthwhile and negotiate any relevant seller concessions and repairs.

 

 

REGRET #6: Choosing a Home That Doesn’t Fit

 

Homeownership is often a better investment if you’re willing to stay put for at least five years.⁷ But if your newly purchased home isn’t a good fit, then you may not want to stick around that long.

 

Many homeowner complaints come down to simple lifestyle issues: Although a mismatch may seem small at first, the problems can magnify if you make so many compromises that they interfere with your quality of life.

 

Or, sometimes homebuyers can fall in love with a beautiful home and forget about practicalities. For example, a stunning kitchen can’t replace a needed bedroom or bathroom. And a sparkling pool may sit empty if the home requires a lengthy commute to your office.

 

Make sure you set some guardrails during your home purchase so you don’t over-compromise or accidentally prioritize your wants over your needs.

 

Lesson Learned:  When you’re dealing with limited inventory or a fixed budget, it may be necessary to sacrifice some items on your home wish list. But if you fail to secure your must-haves, you could come to regret your home choice.

 

We can help you avoid an ill-fitting home purchase by working with you to set (and stick to) priorities and parameters before you begin your search.

 

 

REGRET #7: Purchasing Without Professional Help

 

Another path to homebuyer regret? Foregoing the expert guidance and market insight that you can only get from a licensed real estate agent.

 

Buying a home without professional representation can be extremely risky. Therefore, it’s no surprise that 86% of buyers enlist the help of an agent when purchasing a home. And the vast majority find their assistance to be invaluable: 89% say they would use their agent again or recommend them to others.⁸

 

Real estate is hyperlocal and extremely fluid—especially these days when the market is in constant flux. So it pays to have a knowledgeable expert by your side who can guide you through an often-complicated process.

 

We can help you avoid expensive mistakes that could lead to buyer’s remorse, all while making your home purchase as seamless and stress-free as possible. And since the home seller typically pays our commission, there’s no added expense for you!

 

Lesson Learned:  When you work with a real estate agent, you benefit from a wealth of expertise and on-the-ground insight that you can’t get anywhere else. We’ll help you steer clear of the missteps that so many homebuyers make, so you can focus on enjoying your new home instead of questioning your choices down the road.

 

The best part? Since the majority of home sellers pay us a commission at closing, in most cases, we offer our invaluable guidance and assistance at no additional cost to you!

 

 

BOTTOMLINE

 

No one wants to look back on their home purchase and realize they made a big mistake. We can help you avoid the pitfalls so you can buy with confidence. To learn more about how we work to ensure our clients’ satisfaction, reach out today to schedule a free consultation.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. LendingTree –
   https://www.lendingtree.com/home/mortgage/homebuying-process-survey/
2. Anytime Estimate –
   https://anytimeestimate.com/research/american-home-buyers-2022/
3. Zillow Home Loans – https://zillow.mediaroom.com/2022-11-18-Prospective-home-buyers-spend-about-as-much-time-researching-new-TVs-as-they-do-mortgage-lenders
4. LendingTree –
   https://www.lendingtree.com/home/mortgage/mortgage-shopping-study/
5. CNBC –
   https://www.cnbc.com/2022/05/01/survey-majority-of-homeowners-have-regrets.html
6. Hippo – https://www.hippo.com/blog/2022-hippo-housepower-report-how-homeowners-are-responding-essential-maintenance-during
7. com –
   https://www.realtor.com/advice/sell/how-soon-can-you-sell-a-house-after-buying/
8. National Association of Realtors – https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers#homebuyers

 

Renovate or Relocate? 3 Questions To Help You Decide

 

 

Does your current home no longer serve your needs?

 

If so, you may be torn between relocating to a new home or renovating your existing one. This can be a difficult choice, and there’s a lot to consider—including potential costs, long-term financial implications, and quality of life.

 

A major remodel can be a major commitment. From hiring contractors to selecting materials to managing a budget, it can take a tremendous amount of time and energy—not to mention the ordeal of living through construction or relocating to a temporary residence.

On the other hand, moving is notoriously taxing. In fact, in one survey, 40% of respondents viewed buying a new home as ”the most stressful event in modern life.”¹

So which is the better option for you? Let’s take a closer look at some of the factors you should consider before you decide.

 

 

1. What Are Your Motivations for Making a Change?

 

It’s possible that some of the limitations of your current home can be addressed with a renovation, but others may require a move.

 

Renovate

Certain issues, like dated kitchens and bathrooms, are fairly easy to remedy with a remodel—and the results can be dramatic. In many cases, a relatively minor renovation can significantly increase your enjoyment of your home.

 

Other shortcomings can be more challenging to fix but are worth exploring so that you know your options. For example, if your home feels cramped or it lacks certain rooms, you might be able to make changes like installing an extra bathroom, adding a dedicated office, or finishing an attic or basement. You may even be able to build an accessory dwelling unit or extension to accommodate a multi-generational family.

 

In fact, many Americans have remodeled their homes to meet changing needs since the start of the pandemic. According to the National Association of the Remodeling Industry, 90% of their members reported increased demand for renovations starting in 2020, and 60% reported that the scale of remodeling projects has grown.²

 

However, the feasibility and cost of these larger changes will depend on factors ranging from zoning and permitting to your home’s current layout. Speaking with an architect or a contractor can help you make an informed decision. Let us refer you to one of our trusted partners to ensure you receive the best possible service.

 

Relocate

Of course, sometimes, even rebuilding your home from the ground up wouldn’t solve the problem. For example, moving may be the only solution if you’ve switched jobs and now face a lengthy commute or if you need to live closer to an aging family member.

 

Conversely, if the shift to remote work has opened up your location options, you may wish to seize the opportunity to relocate to a new locale. A 2022 study found that nearly five million Americans had already moved since the start of the COVID-19 pandemic due to increased flexibility from remote work, and nearly 19 million more were planning to move in the near future for the same reasons.³

 

Moving may also be the best option, even when you’re happy with your geographic location. A local move may make sense if you’re looking for a larger backyard or significantly more space. Similarly, some frustrations—like living on a busy street or a long way from a grocery store—can’t be addressed with a renovation. We are well-versed in this area and can help you determine whether another neighborhood might suit you and your family better.

 

 

1. Which Option Makes the Most Financial Sense?

 

Renovating and relocating both come with costs, and it’s wise to explore the financial implications of each choice before you move forward.

 

Renovate

The costs of a renovation can vary widely, so it’s vital to get several estimates from contractors upfront to understand what it might take to achieve your dream home.

 

Be sure to consider all of the potential expenditures, from materials and permits to updates to your electrical and plumbing systems. It’s also prudent to add 10-20% to your total budget to account for unexpected issues.⁴  If you plan to DIY all or part of your renovation, don’t forget to factor in the value of your time.

 

Renovations can also come with hidden expenses. These might include:

• Additional home insurance
• Short-term rental or hotel if you need to move out during the renovation
• Storage unit for possessions that need to be out of the way
• Dining out, laundry service, and other essentials if you can’t access appliances at home

 

Remodeling choices can also impact the long-term value of your home. Some projects may increase your home’s value enough to outweigh your investment, while others could actually hurt your home’s resale potential.

 

For example, although you may enjoy the additional living space, garage conversions aren’t typically popular with buyers.⁵ Refinishing hardwood floors, on the other hand, brings an average return of 147% at resale.²  The specific impact of a renovation will depend on a number of factors, including the quality of work, choice of materials, and buyer preferences in your area. We can help you assess how a planned project is likely to affect the value of your home.

 

Relocate

The cost of a new home, of course, will vary significantly depending on the features you’re seeking. However, you may find that it’s cheaper to move to a home that has everything you want than it is to make major changes to your existing one.

 

For example, adding a downstairs bedroom suite or opening up a closed floor plan could cost you more than it would to buy a home that already has those features. On the other hand, simpler changes and updates probably won’t outweigh the expense of a relocation.

 

If you’re considering a move, speak with a real estate agent early in the process. We can assess your current home’s value and estimate the price of a new home that meets your needs. This will help you set an appropriate budget and expectations.

 

It’s important to remember that the cost of buying a new home doesn’t end with the purchase price. You’ll also need to account for additional expenditures, including closing and moving costs and the fees involved with selling your current home. And don’t forget to compare current mortgage rates to your existing one to understand how a different rate could impact your monthly payment.

 

However, keep in mind that the interest rate on a mortgage is typically lower than the rate on other loan types—so you could pay less interest on a new home purchase than you would on remodel.⁶ We’re happy to refer you to a lending professional who can help you explore your financing options.

 

 

1. Which Option Will Be the Least Disruptive to Your Life?

 

A final—but critical—consideration is the time and hassle involved with each option since both renovating and relocating involve a significant amount of each.

 

Renovate

Don’t underestimate the time and effort involved in a large-scale renovation, even if you choose to hire a general contractor. You will still need to consider and make a number of decisions. For example, even a fairly basic kitchen remodel can involve a seemingly-endless selection of cabinets, tile, countertops, paint colors, fixtures, hardware, and appliances.

 

And don’t assume that you will get out of packing and unpacking if you stay in your current home. Most renovations—from kitchens to bathrooms to flooring replacement—require you to remove your belongings during the construction process.

 

The time frame for a remodel is another consideration. High demand for contractors and ongoing material shortages can mean a long wait to get started. And once the project is in progress, you can expect that it will take a couple of weeks to several months to complete.⁷

 

Contemplate whether you will be able to live in your home while it’s being renovated and how that would impact your routine. For example, being without a functional kitchen for months can be frustrating, inconvenient, and expensive (since you’ll need to purchase prepared food). Remember that delays are inevitable with construction, and consider what additional challenges they could present.

 

Relocate

Of course, finding a new home and selling your current one also takes a significant amount of time and energy. According to the National Association of Realtors’ 2022 Profile of Home Buyers and Sellers, the average buyer searched for 10 weeks and toured a median of five homes.⁸

 

However, in many cases, the timeline can still be shorter than a major renovation. Once you find a home that works for you, it typically takes between 30 and 60 days to close if you’re taking on a mortgage—and the process is even faster if you’re paying with cash.⁹  Plus, you can look for your dream home without the inconvenience of living in a construction zone.

 

However, a move comes with its own stress and disruptions. If you’re selling your current home, you’ll need to prep it for the market and keep it ready and available for showings. Once you’ve found a place, the packing and moving process takes time and work, as does settling into a new home—especially if it’s in a different neighborhood.

 

Fortunately, we are here to help make the moving process as easy as possible, if you choose to pursue that route. We can help you find a property that meets all your needs, sell your current one for top dollar, and refer you to some excellent moving companies that can help pack and transport your belongings.

 

 

WHATEVER YOU DECIDE, WE CAN HELP

 

The decision to renovate or relocate can be overwhelming—but this choice also presents a powerful opportunity to improve your quality of life.

 

There’s a lot to consider, from how renovations could impact your home’s resale value down the road to your neighborhood’s current market dynamics. We’re happy to help you think through your options. Get in touch for a free consultation!

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. HousingWire –
   https://www.housingwire.com/articles/46384-americans-say-buying-a-home-is-most-stressful-event-in-modern-life/
2. National Association of the Remodeling Industry –
   https://cdn.nar.realtor//sites/default/files/documents/2022-remodeling-impact-report-04-19-2022.pdf?_gl=1*3pfs0m*_gcl_au*NTU2MDQ0MzAyLjE2ODMyMzgzMTY
3. Business Insider –
   https://www.businessinsider.com/5-million-people-moved-because-of-remote-work-since-2020-2022-3
4. Forbes –
   https://www.forbes.com/home-improvement/contractor/home-renovation-costs/
5. S. News & World Report –
   https://realestate.usnews.com/real-estate/articles/10-home-renovations-that-can-decrease-the-value-of-your-home
6. Bankrate –
   https://www.bankrate.com/mortgages/mortgage-vs-home-equity-loan/#differences
7. House Beautiful –
   https://www.housebeautiful.com/home-remodeling/a25588459/home-renovation-timeline/
8. National Association of Realtors –
   https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers
9. Forbes –
   https://www.forbes.com/advisor/mortgages/how-long-does-it-take-to-close-on-a-house/

 

National Real Estate Market Update for 2023

 

There’s an old adage in real estate: location, location, location. But ever since the Federal Reserve began its series of inflation-fighting interest rate hikes last year, a new mantra has emerged: mortgage rates, mortgage rates, mortgage rates.

 

Higher rates had the immediate impact of dampening homebuyer affordability and demand. But this year, we’re seeing further repercussions. While analysts expected listing inventory to swell as sales declined, instead, homeowners have been pushing off plans to sell because they feel beholden to their existing, lower mortgage rates.

 

So what impact is this reduced demand and low supply environment having on home values? And what can we expect from the real estate market in the coming months and years? Here are several key indicators that help to paint a picture of the current market and where it’s likely headed.

 

 

HOME SALES ARE EXPECTED TO PICK UP BY EARLY NEXT YEAR

 

The weather isn’t the only thing that heats up in the spring and summer. Nationally, it tends to be the busiest time in real estate. But this year, the peak season got off to a slow start, with sales declines in both March and April.^1,2 Existing home sales in April were down 3.4% from the previous month—and 23.2% from a year earlier.²

 

What’s causing this market slowdown? Industry experts attribute it to several factors, including near-record home prices, high mortgage rates, and low inventory.

 

According to National Association of Realtors (NAR) Chief Economist Lawrence Yun, “Home sales are trying to recover and are highly sensitive to changes in mortgage rates. Yet, at the same time, multiple offers on starter homes are quite common, implying more supply is needed to fully satisfy demand. It’s a unique housing market.”¹

 

However, some industry experts believe the market is poised for a comeback. Forecasters at the Mortgage Bankers Association (MBA) predict that home sales will continue to fall through Q3 before rising in Q4 and throughout next year.³  Analysts at Fannie Mae expect the recovery to take a bit longer, picking up in early 2024.

 

Meanwhile, home builder confidence is already up, as purchases of new single-family homes surged in March and April to a 13-month high.⁵ Builder incentives are helping to boost sales: According to the National Association of Home Builders, in May, 54% reported using them to win over budget-conscious buyers.⁶

 

What does it mean for you?  A slower pace of sales has given buyers some breathing room. If you hated the frenzy of the pandemic-era real estate market, now might be a better time for you to shop for a home. We can help you evaluate your options and make an informed purchase.

 

If you plan to sell your home, prepare yourself for less foot traffic and a longer sales timeline than you may have found a year ago. It will also be crucial to enlist the help of a skilled agent who knows how to draw in buyers. Reach out for a copy of our multi-step Property Marketing Plan.

 

 

PROPERTY VALUES REMAIN RELATIVELY STABLE

 

Some good news for buyers: While home builder sales climbed in April, the median new-house price fell to $420,800, an 8.2% decrease from a year ago.⁵ Meanwhile, the median existing-home price dropped to $388,800, down 1.7% year-over-year. Notably, existing-home prices rose in parts of the country but fell in the South and West.²

 

“Roughly half of the country is experiencing price gains,” explains Yun. “Multiple-offer situations have returned in the spring buying season following the calmer winter market. Distressed and forced property sales are virtually nonexistent.”²

 

The average national home price remains about 40% higher than it was in early 2020, according to the S&P CoreLogic Case-Shiller index.⁷ A tight housing supply has helped to buoy prices amidst a slowdown in sales.

 

“While it varies from region to region, home prices at the national level may fall 1% or 1.5% by the end of the year, so not much,” Doug Duncan, senior vice president and chief economist at Fannie Mae, told Yahoo Finance in April.⁸

 

Record levels of home equity will help to stabilize the sector and prevent a wave of foreclosures, even as prices moderate, according to Mark Zandi, chief economist at Moody’s Analytics.⁹

 

“But for those who have owned a home for more than a year or two, their home will remain a rock-solid investment. And once affordability is restored, the next generation of households can become homeowners. Getting there is critical to the financial well-being of those households, their communities, and the broader economy,” writes Zandi in The Washington Post.⁹

 

What does it mean for you?  Prices have softened in certain market segments—and motivated sellers are out there and willing to make deals. We can help you find your next home and negotiate a great price.

 

If you’re a homeowner, the surge in home values has slowed, but you’re likely still sitting on a nice pile of equity. Reach out for a free assessment to find out how much your home is currently worth.

 

 

LISTING INVENTORY IS LOW, BUT NEW CONSTRUCTION IS ON THE RISE

 

Unsold existing home inventory rose 7.2% from March to April, according to NAR. At the current level of demand, this equates to 2.9 months of supply, which is still well below the 5 to 6 months of inventory required for a “balanced” market.²

 

Inventory remains tight despite the market slowdown because many would-be sellers are reluctant to give up their lower mortgage rates. “Affordability is not only an issue for first-time homebuyers, but also for many repeat buyers who still need to take on a mortgage,” explains Danielle Hale, chief economist for Realtor.com.¹⁰

 

In a recent survey by the home listing site, 82% of respondents who are planning to both buy and sell a home said they feel “locked in” by their low rate.¹¹

 

In some areas, new home construction is helping to fill the supply gap. “Currently, one-third of housing inventory is new construction, compared to historical norms of a little more than 10%,” according to National Association of Home Builders Chief Economist Robert Dietz.¹²

 

And more new homes are in the pipeline, after a builder slowdown last year. Single-family housing starts rose 1.6% from March to April (seasonally adjusted) and new construction permits hit a seven-month high.¹³

 

What does it mean for you?  Inventory remains tight, but less competition means more choice and negotiating power for buyers. If you’ve had trouble finding a home in the past, it may be time to take another look. We can help you explore both new and existing homes in our area.

 

Sellers are enjoying reduced competition right now, as well. However, the longer you wait to list, the more competition you’re likely to face. And if you feel locked in by your current, lower mortgage rate, consider this: If you roll your equity gains into a down payment on your next home, you could possibly lower your monthly payment. Reach out to discuss your options.

 

 

MORTGAGE RATES MAY FINALLY COME DOWN

 

According to Freddie Mac, the average 30-year fixed-rate mortgage hit a peak of 7.08% in the fourth quarter of 2022, and since then it’s primarily floated between 6 and 7%.¹⁴ However, there are signs that rates could trend lower later this year.

 

“Calmer inflation means lower mortgage rates, eventually,” Yun predicted in a recent statement. “Mortgage rates slipping down to under 6% looks very likely toward the year’s end.”¹⁵

 

Other leading economists agree. In its May forecast, Fannie Mae speculates that 30-year fixed mortgage rates will continue to decline, averaging 6.0% in Q4 2023 and 5.4% by Q4 2024.⁴ Meanwhile, the MBA predicts rates will fall even faster, averaging 5.6% by Q4 2023 and 4.8% by Q4 2024.³

 

On May 3, the Federal Reserve raised its benchmark borrowing rate by another quarter point—its 10th consecutive increase since March 2022. However, in its corresponding statement, the Fed omitted language from its previous release about “additional policy firming,” leaving some analysts to speculate that the rate hikes may be over.¹⁶

 

Although mortgage rates aren’t directly tied to the federal funds rate, a decision by the Fed to pause rate increases could have a positive effect. In the meantime, buyers should shop around multiple lenders to find the best rate—and buckle up for what could be an exciting ride.

 

What does it mean for you?  Mortgage rates may finally trend down, which would be great news for buyers. But, a decrease in rates could correspond with an increase in competition and prices. If you start searching now, you’ll be prepared to make an offer when the time is right. We can help you negotiate a great deal and potential seller incentives.

 

If you’re planning to sell, this is good news for you, too. But, there are several factors to consider when determining the right time to list your home. Reach out for a consultation so we can help you chart the best course.

 

 

WE’RE HERE TO GUIDE YOU

 

While national real estate forecasts can provide a “big picture” outlook, real estate is local. And as local market experts, we can guide you through the ins and outs of our market and the issues most likely to impact sales and drive home values in your particular neighborhood.

 

If you’re considering buying or selling a home, contact us now to schedule a free consultation. We’ll work with you to develop an action plan to meet your real estate goals.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. National Association of Realtors –
   https://www.nar.realtor/newsroom/existing-home-sales-slid-2-4-in-march
2. National Association of Realtors –
   https://www.nar.realtor/newsroom/existing-home-sales-faded-3-4-in-april
3. Mortgage Bankers Association –
   https://www.mba.org/docs/default-source/research-and-forecasts/forecasts/2023/mortgage-finance-forecast-may-2023.pdf?sfvrsn=4bf1d1a7_1
4. Fannie Mae –
   https://www.fanniemae.com/media/47006/display
5. S. Census Bureau –
   https://www.census.gov/construction/nrs/current/index.html
6. National Association of Home Builders –
   https://www.nahb.org/news-and-economics/press-releases/2023/05/lack-of-existing-inventory–boosts-builder-confidence-to-key-marker
7. New York Times –
   https://www.nytimes.com/2023/04/29/business/spring-housing-market.html?
8. Yahoo Finance –
   https://finance.yahoo.com/news/mortgage-rates-increase-after-weeks-of-declines-160015631.html
9. The Washington Post –
   https://www.washingtonpost.com/business/2023/04/22/housing-prices-put-some-out-of-the-market/
10. CNBC –
    https://www.cnbc.com/2023/04/20/home-sales-fell-in-march-amid-volatility-in-mortgage-rates.html
11. com –
    https://www.realtor.com/research/2023-q1-sellers-survey-btts/
12. National Association of Home Builders –
    https://www.nahb.org/news-and-economics/press-releases/2023/04/lack-of-existing-inventory-continues-to-support-builder-sentiment
13. United State Census Bureau –
    https://www.census.gov/construction/nrc/pdf/newresconst.pdf
14. Freddie Mac –
    https://www.freddiemac.com/pmms
15. National Association of Realtors –
    https://www.nar.realtor/blogs/economists-outlook/instant-reaction-inflation-april-12-2023
16. CNBC –
    https://www.cnbc.com/2023/05/03/fed-rate-decision-may-2023-.html

How to Become a Homeowner on a First-Time Buyer’s Budget

 

It’s not easy being a first-time homebuyer right now. At the end of last year, housing affordability hit an all-time low.¹ Additionally, mortgage rates have risen significantly since 2021, while inventory remains tight for many property categories, but especially for starter homes. Even lower-priced condos are harder to snag these days, as investors and downsizers muscle out first-timers by offering stronger, often cash-heavy bids.²

 

In fact, according to the National Association of Realtors, only 26% of last year’s homebuyers were first-timers—the lowest share on record and down from 34% a year prior. This underscores just how steep a hill new buyers are facing.³ As a result, many first-time homebuyers are finding that they need to get creative or risk renting for longer than they planned.

 

If you, too, are struggling to afford homeownership, here are some workarounds to consider as you plot your first home purchase.

 

 

1. Try House Hacking

 

“House hacking” is a real estate investment strategy in which participants use their homes to generate income in order to offset their expenditures.

 

For example, renting out a basement apartment or accessory dwelling unit (ADU)—such as a detached garage that’s been outfitted with a bathroom and small kitchen—counts as house hacking. So does splitting housing costs with a roommate or converting a part of your home into an Airbnb.

 

House hacking isn’t new. But, it’s grown in popularity as a new crop of digital platforms has entered the market and made it easier than ever for homeowners to generate income from their property.

 

In some cases, house hacking may make it possible for you to qualify for and afford your first home. A lender, for example, may approve you for a larger mortgage if you purchase a home with immediate income potential, such as a legal duplex or a property with a secondary suite that has a kitchen and full bathroom.⁴

 

In addition, house hacking could help you pay your mortgage once you move in. Here are just a few of the ways you could use your home to earn some extra cash:

 

• Offer paid parking in your driveway on a site like Spacer or SpotHero.
• Rent out your swimming pool for a few hours on Swimply.
• Make your home available for photoshoots or events on Giggster or Peerspace.
• Turn your backyard into a pay-by-the-hour dog park on Sniffspot.
• List your garage space on an app like Neighbor Storage.

 

But before you make plans to house hack, make sure you fully understand an area’s laws and HOA rules. We can help you find a home with income potential in a neighborhood with less restrictive zoning and regulations.

 

 

2. Team Up With Friends or Family

 

If you aren’t wild about the idea of welcoming strangers to your home, you may want to consider co-purchasing with a friend or family member instead. This unconventional housing arrangement is also growing more popular as friends and family members cope with higher living costs by pooling resources.

 

According to the National Association of Realtors’ 2022 Profile of Home Buyers and Sellers, the share of first-time homebuyers living with people other than children or a romantic partner is currently at an all-time high.³ Meanwhile, research from Pew found that multigenerational living has accelerated especially quickly, with a quarter of U.S. adults aged 25 to 34 now living in a multigenerational home.⁵

 

Arrangements can be customized to fit your circumstances. For example, you could purchase a home and then rent a portion of it to a loved one. Or you might consider co-buying a home with friends or family members so that you can step onto the property ladder and start building equity together.

 

Co-ownership could work out especially well for you long-term if it helps you to buy a home that’s bigger, has more investment potential, or is located in a high-demand area and so appreciates at a faster rate. Plus, you’ll get to see your loved ones more often and enjoy the coziness of shared living with people you like having around.

 

On the other hand, sharing a big financial responsibility, like a mortgage, with friends or family could get messy—especially if you don’t create a clear-cut co-ownership agreement beforehand that outlines your mutual expectations. So plan carefully before you proceed.

 

In addition, you may need to rethink the type of home you pursue. For example, a smaller home might be cheaper, but do you really want that much togetherness all the time? We can help you set priorities and search for a suitable property.

 

 

3. Tap Your Network for Help With Funding

 

Another established method for affording a first home is to lean on family or friends for financial help. Getting assistance with the down payment or other borrowing costs can go a long way toward making your homeownership dreams come true.

 

As long as you don’t mind asking for help, a free-and-clear gift that’s intended for your down payment is an ideal arrangement, since it will allow you to borrow less overall. Or, if that’s too big an ask, your loved ones could pitch in toward closing or moving costs.

 

Alternatively, your loved ones could help by co-signing your loan. For example, if their credit score is a lot higher than yours, it could enable you to secure a lower interest rate so that your monthly payment is more affordable.

 

According to a recent YouGov poll, more than a third of homeowners (and a whopping 79% of those under 30) received financial help from their parents when buying their first home.⁶ So you wouldn’t be the only one leaning on family to help afford a home at today’s prices.

 

Just be sure your parents or other generous loved ones are aware they’re giving a gift, not a loan, and are willing to put that in writing. A lender will want proof that this money isn’t adding to your debt burden and may require documentation from your benefactors.

 

Another way to tap your network for help is to crowdfund part of your down payment or ask for monetary gifts instead of tangible ones. For example, if you’re getting married soon, you could skip the wedding gift registry and ask guests to contribute funds to your hoped-for home purchase instead.

 

 

4. Look for Special Programs and Assistance

 

You could also cut some of your upfront mortgage costs by applying for special grants and funding opportunities.

 

For example, consider using a grant to help you fund your down payment. There are a number of public and private grants and down payment assistance programs that are expressly intended to help first-time buyers.

 

Just like a gift, you don’t have to pay a grant back. But, depending on your personal situation, you may find some grants difficult to qualify for—especially if you make a relatively high income.

Many grants are reserved for lower-income buyers only.⁷

 

Check out grant programs, such as the HomePath Ready Buyer Program, National Homebuyers Fund, the Good Neighbor Next Door Program, and specialized grants from banks. Also look to state and local sources for potential grants and down payment assistance programs, including forgivable and deferred payment loans, Individual Development Accounts, and DPA Second Mortgages.⁷

 

Similarly, if you have enough income to support a house payment but can’t spare much cash for your down payment, you may qualify for a government-sponsored loan, such as an FHA loan that allows you to put down as little as 3.5% to 10%.⁸

 

We can connect you with a lender or mortgage broker who can educate you about your options and help shepherd you through the process. Some financial assistance programs require you to work with specific lenders, while others require you to apply directly and fill out a separate application.

 

In addition, you may look to even less conventional options, such as seller financing. But be aware these kinds of arrangements are rare and hard to find. Depending on the market, you will likely get more help from a seller if you ask them to pay closing costs or contribute to your mortgage rate buydown. In many cases, we can help you negotiate seller concessions that make your home purchase more affordable.

 

 

5. Expand Your Home Search

 

If you’re having trouble finding a home within your budget, consider broadening your search criteria. You may be surprised by the kinds of deals that are available when you’re willing to compromise.

 

For example, if you’re struggling to find an affordable home in your target neighborhood, expand your search area and consider homes that are further out of town or that are located in up-and-coming areas with lower starting prices. We would be happy to introduce you to some great but lesser-known neighborhoods that we consider hidden gems.

 

You could also save money on your home purchase simply by dropping or revising some of your must-haves and settling for OK-to-haves instead.

 

For example, do you really need two bathrooms and a large backyard? Or could you settle for a single bathroom with space to add a second one in the future? And would a small garden, cozy balcony, or rooftop terrace still give you the outdoor time you crave? These types of compromises can sometimes shave tens of thousands off your purchase price.

 

Similarly, if you don’t mind rolling up your sleeves or working with a contractor on minor jobs, you can look for homes that need a little TLC. Just because a house looks dated doesn’t mean it’s destined to stay that way or that it will take a ton of money to spruce up. In fact, a home with good bones but cosmetic flaws could be a perfect match: With less competition, you’ll have a better chance of purchasing the home at an affordable price. You can then take your time to save more and fix it up to your taste.

 

Keep in mind, starter homes are rarely forever homes, but merely a first step onto the property ladder. By gaining a foothold in the real estate market now, you can set yourself up to afford a more expensive property in the future.

 

According to the National Association of Realtors, in 2021, the net worth of a typical homeowner was $300,000, while that of a renter was only $8,000.⁹ We can help you find an affordable first home so you can start building equity to reach your long-term financial and real estate goals.

 

 

YOU CAN DO IT—AND WE CAN HELP

 

Buying a first home is challenging, but it’s not impossible—especially when you have a savvy real estate professional in your corner. We will work with you to devise a plan to overcome your financial constraints. Then, we’ll help you find a home that not only excites you but also fits your budget and lifestyle. Give us a call to get started with a free exploratory consultation.

 

 

The above references an opinion and is for informational purposes only. It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

 

Sources:

1. Housing Wire –
   https://www.housingwire.com/articles/housing-affordability-ends-2022-at-record-low/
2. com – https://www.realtor.com/news/trends/death-of-the-starter-home-where-have-all-the-small-houses-gone/
3. National Association of Realtors – https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers
4. ValuePenguin –
   https://www.valuepenguin.com/mortgages/claiming-rental-income-for-mortgage
5. Pew – https://www.pewresearch.org/fact-tank/2022/07/20/young-adults-in-u-s-are-much-more-likely-than-50-years-ago-to-be-living-in-a-multigenerational-household/
6. YouGov – https://today.yougov.com/topics/economy/articles-reports/2022/05/25/american-homebuyers-finanancial-help-parents
7. Bankrate –
   https://www.bankrate.com/mortgages/first-time-homebuyer-grants/#types
8. Investopedia –
   https://www.investopedia.com/terms/f/fhaloan.asp
9. National Association of Realtors – https://www.nar.realtor/sites/default/files/documents/2022-snapshot-of-race-and-home-buying-in-the-us-04-26-2022.pdf

 

Stress-Free Home Cleaning: 27 Practical Tactics for Busy Households

 

Keeping a clean and orderly home is a challenge for many of us. Between busy work schedules, social obligations, and family commitments, it’s tough to keep up with daily chores—let alone larger seasonal tasks.

 

The effort is worthwhile, however. A sanitary environment can keep you and your family healthier by minimizing your exposure to germs and allergens.¹ Plus, researchers have found that organized, uncluttered homes have quantifiable mental health benefits, too, including reduced stress, improved emotional regulation, and increased productivity.²

 

The reality is, we enjoy our homes more when they are in good order. It’s much easier to relax without piles of unopened mail or a messy kitchen reminding us of work to be done. And don’t we all feel more inclined to entertain family and friends when our homes are well-kept?

 

That’s why we’ve rounded up our favorite tactics—from overall strategies to little tips and tricks—for keeping things tidy without spending all our spare time cleaning.

 

 

Set a Schedule for Daily and Weekly Cleaning

 

We’ve all been there—you put off vacuuming or mopping your floor for a few days, only to realize that weeks have passed. Creating a cleaning schedule that works for you is the best way to stay on top of things and avoid overwhelm. Here are a few of our favorite strategies:

 

1. Designate a day of the week for each task—then, add them to your calendar so you can’t forget.
2. Create a shared schedule that assigns specific responsibilities to each member of the household. Post it in a prominent place, like on the refrigerator, or create a shared digital calendar.
3. Carve out 15 minutes a day for cleaning and decluttering. Set a timer on your phone and get as much done as you can before it goes off.

 

It may take some trial and error to find the tactics that work best for you. The most important thing is to make a habit of cleaning so that clutter and grime don’t have a chance to build. And if you’d like some professional help, reach out for a referral to one of our favorite cleaning services!

 

 

Tackle Bigger Chores Seasonally

 

Many home care tasks are seasonal by nature and only need to be completed once or twice a year. But when we don’t have a plan to tackle them, it’s all too easy to put them off. Here are a few tips to stay on top of these chores:

 

1. Mark days on your calendar in advance to attend to annual or semi-annual chores, like cleaning gutters, washing windows, turning mattresses, and shampooing carpets.
2. Schedule just one primary task each weekend instead of blocking out a full two days. This will help ensure a good balance between chores and relaxation.
3. Designate a date two to four times a year, depending on your lifestyle, to put away out-of-season items like clothes, holiday decorations, and sporting goods.
4. Take some time to sort through your seasonal items when you pack them away. Then you can toss, sell, or donate items that you no longer need or enjoy.

 

Remember—breaking down these larger tasks can make them less overwhelming. If you space them out so that you can handle them one by one, even the most time-consuming chores become a lot more manageable.

 

And since all your time is valuable, don’t hesitate to delegate these larger home care tasks to professionals. Give us a call for a list of our recommended service providers.

 

 

Reduce the Barriers to Cleaning

 

Set yourself up for success by ensuring you have the tools on hand to tackle small tasks with ease. Here are a few ways to make your cleaning supplies more accessible:

 

1. Store a broom, dustpan, and vacuum on each floor of your home so they’re easy to reach.
2. Stash containers of disinfecting and glass wipes under every sink for a mid-week wipe-down.
3. Place extra bags beneath the liner of your garbage pails, so you’ll have a replacement ready when you take out the trash.
4. Keep a paper shredder and recycling bin handy so you can dispose of unwanted mail as it’s opened.

 

By strategically placing your tools and supplies in the locations where you’re most likely to need them, you’ll make cleaning less of a chore and more of a habit.

 

 

Stop the Clutter Before It Starts

 

From coats to shoes to mail, it’s all too easy to find clutter taking over your home. Once these piles start to form, they can feel overwhelming—which only makes it harder to address them.

 

To avoid this problem, stop the clutter before it starts. Assign every item a home and create storage spaces and “drop zones” in key locations.³ Here are a few ideas to get you started:

 

1. Install coat hooks and shoe racks in the entryway for easy access.
2. Add a key caddy or shelf for essential items to get you out the door.
3. Hang a letter bin to capture mail and newspapers as soon as you walk into the house.
4. Place a donation box in each closet for items you no longer want or need.

 

It can take a little time to get in the habit of returning items to their assigned space. But once you do, staying on top of clutter will become far more manageable.

 

Are you considering a larger organizational upgrade, like a custom closet or pantry system? Reach out for a free consultation to find out how the investment could impact the value of your home!

 

 

Tackle Small Tasks Right Away

 

Sometimes, the mental load of thinking about a chore you need to do is worse than the chore itself. Plus, handling small tasks right away can reduce the need for lengthy cleaning sessions.³

 

Try working these changes into your routine:

1. Learn to clean as you cook, rather than piling it all up for later. As you wait for water to boil or food to cook through, wash the bowls and utensils you used for prep.
2. Hang bath towels on a bar immediately after use. By allowing them to properly air dry, you can cut down on the frequency of laundering.
3. Bring items with you when you leave a room. For example, return plates and cups to the kitchen right away rather than letting them stack up in your home office.
4. Take out the trash when you leave for work, school drop-off, or errands. This will save you the time and hassle of a second trip.

 

If you implement these small changes, your home will stay neater—and you’ll minimize the number of dedicated cleaning sessions you need to take on each week.

 

 

Embrace an Evening “Shutdown” Routine

 

Kitchens can get dirty and cluttered fast. But a few minutes spent cleaning up each evening can prevent the mess from getting out of control.⁴

 

Imagine your kitchen is a restaurant and you’re tidying it up before closing down for the night. These simple steps will prepare you for the morning rush:

 

1. Wipe down all surfaces, including countertops, stove, microwave, and sink. Then toss your soiled washcloth in the hamper and lay out a fresh one for tomorrow.
2. Load and run the dishwasher every night so you can empty it the next morning.
3. Prepare for breakfast by programming your coffee pot and setting out some grab-and-go options.

 

We all know it can be hard to find the energy for chores in the evening. But if you complete these small tasks each night, you’ll start the next day off right in a tidy, clean kitchen.

 

 

Think Outside of the Box When It Comes to Storage

 

Most of us have limited storage space. Unfortunately, without the right spots to stash our items, it’s easy to become disorganized.

 

But we’ve found that using household items in innovative ways can help keep mess and clutter under control.⁵ Here are a few of our favorite swaps:

1. Place a magazine file in your kitchen for cookbooks, takeout menus, and meal kit cards.
2. Hang a pocket-style shoe organizer inside your pantry door to store granola bars, spice jars, and other small items.
3. Separate dress and athletic socks by turning an old shoe box into a drawer divider.
4. Repurpose jam jars by using them to store office supplies or bathroom essentials.
5. Store out-of-season clothes inside rarely-used suitcases, so all that space doesn’t go to waste.

 

A little creativity goes a long way when it comes to making the most of your space. Just be sure that you’re creating systems you can stick with and not putting things where you might forget about them later!

 

 

WE’RE HERE TO HELP YOU MAKE THE MOST OF YOUR HOME

 

Keeping your home clean and organized can be a continuous struggle—there’s no need to feel ashamed of that. But taking the time to implement systems that work for you can make life more pleasant and less stressful in the long run.

 

Remember, we’re not just here to help you buy or sell a home. We want you to love living in it, too. Reach out if you need referrals for house cleaners, window washers, or other service providers that can help you make the most of your space.

 

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.

 

Sources:

1. Healthline –
   https://www.healthline.com/health-news/5-health-benefits-of-spring-cleaning
2. Forbes –
   https://www.forbes.com/health/mind/mental-health-clean-home/
3. My Domaine –
   https://www.mydomaine.com/house-cleaning-schedule
4. Housewife How-Tos –

https://housewifehowtos.com/clean/10-tips-to-keeping-a-clean-house/

5. Better Homes and Gardens –

https://www.bhg.com/decorating/storage/projects/simple-solutions/