Blog | REAL ESTATE SERVICES by JOHN RICE REALTOR 616-951-4663 BHHSMI MICHIGAN REAL ESTATE

New Home Sales Up 12.7% From Last Year

By JOHN RICE ASSOCIATE BROKER | REALTOR on October 16, 2018 in Blog, BUYERS, Real Estate Updates, Sellers

New Home Sales Up 12.7% From Last Year

According to the latest New Residential Sales Report from the Census Bureau, new construction sales in August were up 3.5% from July and 12.7% from last year! This marks the second consecutive month with double-digit year-over-year growth (12.8% in July).

The report also showed that builders have ramped up construction with an increase in new construction starts and completions. The summer months are often a busy time for builders as they capitalize on the warmer weather to be able to finish projects.

Below is a table showing the change in starts, completions, and sales from last August.

Other notable news from the report is that the percentage of new construction sales in the $200-$299k range has continued to break away from the $300-$399k range.

This shows that builders are starting to build lower-priced homes that will help alleviate some of the inventory challenges in the starter and trade-up home categories. The chart below shows the full breakdown.

What does this mean for buyers and sellers?

If you are thinking of buying or selling in today’s market, you no doubt have heard that there is a shortage of existing homes for sale which has been driving home prices up across the country. The additional new construction coming to the market could help alleviate this shortage, but we are still not back up to pre-crisis levels.

Thinking of building new? Contact us and we can review some of the time tested methods to have your on the track for success!

MESSAGE JOHN

Source: Michigan Real Estate Updates

Pre-Approval: Your 1st Step in Buying a Home

By JOHN RICE ASSOCIATE BROKER | REALTOR on October 16, 2018 in Blog, BUYERS, Real Estate Updates, Sellers

Pre-Approval: Your 1st Step in Buying a Home

In many markets across the country, the number of buyers searching for their dream homes outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you through this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the ‘4 Cs’ that help determine the amount you will be qualified to borrow:

Capacity: Your current and future ability to make your payments
Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
Collateral: The home, or type of home, that you would like to purchase
Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential homebuyers overestimate the down payment and credit scores necessary to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so.

Reach out so we can discuss what you are looking to achieve. Many times different loan officers and lending institutions are suited for specific types of lending (new construction vs buying existing, vs VA or other types of financing.) We’re here to point you in the right direction and make you are on the right path every step of the way.

MESSAGE JOHN

Source: Michigan Real Estate Updates

Incredible Opportunity 5 Acre 4200+ Sqft Home Adjoining State Land

By JOHN RICE ASSOCIATE BROKER | REALTOR on October 10, 2018 in Blog, BUYERS, New Featured Listings, Real Estate Updates, Sellers

Bed and Breakfast, Multi-Unit, Single Family, add extra ”tiny houses” – the options are endless! Your retreat awaits! Enjoy this peaceful 4.9 Acres with private pond and over 4200 sqft of finished living space. This amazing opportunity features a meticulously maintained 4 bedroom 3 full bath home with 2 stall garage, storage building, beautiful creek fed pond, and adjoins state land. Additionally, this home is setup to be divided into 3 individual units, creating ”space for everyone” if you need extra room – see attached potential units with 3 kitchens already plumbed, each with its own bath and and bedroom and more. Call today for details and to schedule your private tour.

11262 US 10 DETAILS

2 Factors to Watch in Today’s Real Estate Market Whether Buying or Selling

By JOHN RICE ASSOCIATE BROKER | REALTOR on October 5, 2018 in BUYERS, Real Estate Updates, Sellers

2 Factors to Watch in Today’s Real Estate Market Whether Buying or Selling

When it comes to buying or selling a home there are many factors you should consider. Where you want to live, why you want to buy or sell, and who will help you along your journey are just some of those factors. When it comes to today’s real estate market, though, the top two factors to consider are what’s happening with interest rates & inventory.

Interest Rates

Mortgage interest rates have been on the rise and are now over three-quarters of a percentage point higher than they were at the beginning of the year. According to Freddie Mac’s latest Primary Mortgage Market Survey, rates climbed to 4.72% for a 30-year fixed rate mortgage last week.

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows the impact that rising interest rates would have if you planned to purchase a $400,000 home while keeping your principal and interest payments between $2,020-$2,050 a month.

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will be over 5% by this time next year.

Inventory

A ‘normal’ real estate market requires there to be a 6-month supply of homes for sale in order for prices to increase only with inflation. According to the National Association of Realtors (NAR), listing inventory is currently at a 4.3-month supply (still well below the 6-months needed), which has put upward pressure on home prices. Home prices have increased year-over-year for the last 78 straight months.

The inventory of homes for sale in the real estate market had been on a steady decline and experienced year-over-year drops for 36 straight months (from July 2015 to May 2018), but we are starting to see a shift in inventory over the last three months.

The chart below shows the change in housing supply over the last 12 months compared to the previous 12 months. As you can see, in June, July, and August, inventory levels have started to increase as compared to the same time last year.

This is a trend to watch as we move further into the fall and winter months. If we continue to see an increase in homes for sale, we could start moving further away from a seller’s market and closer to a normal market.

Bottom Line

If you are planning to enter the housing market, either as a buyer or a seller, let’s get together to discuss the changes in mortgage interest rates and inventory and what they could mean for you.

Source: Michigan Real Estate Updates

Prime Development 15 Multi-Acre Sites – 1-15 Woodland Creek Trail

By JOHN RICE ASSOCIATE BROKER | REALTOR on October 5, 2018 in Blog, BUYERS, New Featured Listings, Real Estate Updates, Sellers

Prime Development Opportunity with 15 lots, road, and more. This 40+ acre site condo community has been approved under the name of Wood Creek Farms Condominiums and features 15 multi-acre sites. Each site offers large building envelopes, well designed open space and each site perks! With Woodland Creek bordering the East and Little Thornapple River bordering the North, this development offers amazing opportunity to create a landscape future home owners will love. First layers of road have been laid and initial well has been dug, and perk tests performed.

WOODLAND CREEK TRAIL DETAILS

Island Retreat – Now Is The Time

By JOHN RICE ASSOCIATE BROKER | REALTOR on September 29, 2018 in BUYERS, New Featured Listings, Sellers

1943 S Duck Bay Trail | Cedarville, MI 49719

Property Description

MOTIVATED SELLER – NOW IS THE TIME TO ACT – 8.4 Acres on Marquette Island with over 896 feet of private waterfront on Duck Bay in the Les Cheneaux Islands of Lake Huron. Gorgeous pristine natural waterways offer the best of boating and nature. The Les Cheneaux Islands are known for their rich history providing calm waters off the Straights of Mackinac for boaters and outdoor enthusiasts. This one-of-a-kind site has kept its natural beauty while offering on-site electric, water, 2 log cabins, cook shelter and more. With several build sites opportunities this setting is perfect to enjoy as it is or for your dream home. The Les Cheneaux Islands is a boat friendly community offering several amenities within a short boat ride including restaurants, shopping, entertainment, golf and more. 8.4 Acres on Marquette Island with over 896 feet of private waterfront on Duck Bay in the Les Cheneaux Islands of Lake Huron. Gorgeous pristine natural waterways offer the best of boating and nature. The Les Cheneaux Islands are known for their rich history providing calm waters off the Straights of Mackinac for boaters and outdoor enthusiasts. Listen to the trees whisper in the wind while you enjoy your days fresh catch around an open fire. This one-of-a-kind site has kept its natural beauty while offering on-site electric, water, 2 log cabins, cook shelter and more. With several build sites opportunities this setting is perfect to enjoy as it is or for your dream home. Abundant with wildlife and peaceful calm that can only be found some of the most sought after and unique water in the Northern Hemisphere. The Les Cheneaux Islands is a boat friendly community offering several amenities within a short boat ride including restaurants, shopping, entertainment, golf and more. Contact listing agent John Rice, 616-951-4663, for your private tour today.

NOTE: Seller is open to dividing the property and Land Contract Terms are available

1943 S DUCK BAY TRAIL DETAILS

Are Home Prices Softening or Are They Falling?

By JOHN RICE ASSOCIATE BROKER | REALTOR on September 27, 2018 in Real Estate Updates

Are Home Prices Softening or Are They Falling?

We are beginning to see reports that more housing inventory is coming to the market and that buyer demand may not be increasing at the same pace it did earlier this year. The result will be many headlines written to address the impact that these two situations will have on home values.

Many of these headline writers will confuse “softening home prices” with “falling home prices,” but there is a major difference between the two.

The data will begin to show that home values are not appreciating at the same levels as they had over the last several years (softening prices). This does NOT mean that prices are depreciating (falling prices).

Here is an example: Over the last several years, national home values increased by more than 6% annually. If you had a home worth $300,000 at the beginning of the year, it would be worth $318,000 by year’s end. If the appreciation rate “falls” to 4%, that $300,000 house would be worth $312,000 at the end of next year – a $6,000 difference.

The price of the home did not fall. It just didn’t increase at the level it had the previous year.

Appreciation rates are projected to end this year at approximately 5%, and then drop to somewhere between 4-5% next year. This drop in appreciation rate will cause home price increases to soften.

Again, this does not mean that home prices will depreciate, but instead that they will appreciate more slowly.

Bottom Line

Be careful when reading headlines that discuss home values. Some headline writers will be legitimately confused and will use the word falling in place of softening. Others will realize that the headline “Home Prices are Falling!” will get more clicks than “Home Prices are Softening” and will intentionally write the more compelling headline. Read the article. If the word depreciation is not mentioned, home values are not falling.

Source: Michigan Real Estate Updates

Just How HOT Is The Market Near You?

By JOHN RICE ASSOCIATE BROKER | REALTOR on September 26, 2018 in Blog, BUYERS, Real Estate Updates, Sellers

Ever wonder just how HOT the market is near you?

Want to know if buyers have been searching for a home like yours?

When considering a move there are typically a few questions you want answered:

What’s the market like for my home?
Are there buyers right now looking?
What’s the market like in the area I am considering moving too?
How accurate is the estimate I saw online for my house? Is that REALLY the price I can obtain for this house?
How does condition affect the sale of my home?
What’s the neighborhood sales been like recently?
My house is better/not quite as nice as the neighbors…what did theirs sell for? (They told me but I want to confirm it.)

We have partnered with a top technology company to provide you with amazing insight into the above questions. Frankly, your home is more than bedrooms/baths or square footage in a zip code. Improvements, curb appeal and distance to nearby workplaces, schools and attractions contribute to your home’s value. It is with you in mind that we bring to you this tremendous tool, providing you with data and insights not available anywhere else.

To get started on the report for your own house – click here: GET YOUR REPORT NOW

Here are a few screenshots of the report – the data will be specific your property for your report:

Check current market values for your home and view profiles of potential buyers.

An automated value estimate can give you a rough estimate of the value of your home. This can be a useful starting point.

Find out more now:

START HERE

Where Are Mortgage Interest Rates Headed In 2019?

By JOHN RICE ASSOCIATE BROKER | REALTOR on September 25, 2018 in Blog, BUYERS, Real Estate Updates, Sellers

Where Are Mortgage Interest Rates Headed In 2019?

The interest rate you pay on your home mortgage has a direct impact on your monthly payment; the higher the rate, the greater the payment will be. That is why it is important to know where rates are headed when deciding to start your home search.

Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next year.

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.2% from this time last year and are predicted to be 5.1% higher next year.

If both the predictions of home price and interest rate increases become a reality, families would wind up paying considerably more for their next homes.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth, so don’t wait until next year! Let’s get together to evaluate your ability to purchase your dream home now.

To find out the best next step:

MESSAGE JOHN

Source: Michigan Real Estate Updates

How Much Has Your Home Increased in Value?

By JOHN RICE ASSOCIATE BROKER | REALTOR on September 24, 2018 in Blog, BUYERS, Real Estate Updates, Sellers

How Much Has Your Home Increased in Value?

Home values have risen dramatically over the last twelve months. In CoreLogic’s most recent Home Price Index Report, they revealed that national home prices have increased by 6.2% year-over-year.

CoreLogic broke down appreciation even further into four price ranges, giving us a more detailed view than if we had simply looked at the year-over-year increases in national median home price.

The chart below shows the four price ranges from the report, as well as each one’s year-over-year growth from July 2017 to July 2018 (the latest data available).

It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor which determines how much your home has appreciated over the course of the last year.

Lower-priced homes have appreciated at greater rates than homes at the upper ends of the spectrum due to demand from first-time home buyers and baby boomers looking to downsize.

Bottom Line

If you are planning to list your home for sale in today’s market, let’s get together to go over exactly what’s going on in your area and your price range.

To learn more about the specific appreciation for your home and the market:

MESSAGE JOHN

Source: Michigan Real Estate Updates

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