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    Renters: It is about to Get A Lot Worse

    Renters: It is about to Get A Lot Worse

    We often promote homeownership over renting when a family is ready, willing and able to purchase. There are both financial and non-financial benefits to owning a home of your own. Based on the headlines below, many news outlets agreed with us after they reviewed a recent report from the Harvard Joint Center for Housing Studies and Enterprise Community Partners.

    The study states that the number of households spending 50% or more of their income on rent is expected to rise by over ten percent in the next decade. They concluded:

    “Overall, this white paper projects a fairly bleak picture of severe renter burdens across the US for the coming decade.”

    What do other experts think of the report? You can tell by the headlines they chose to introduce their stories:

    “Renters, get ready to take it on the chin” – CNBC

    “The Rent Crisis Is About to Get a Lot Worse” – Bloomberg Business

    “Renters Will Continue to Struggle for the Next Decade” – World Street Journal

    “Why the renting crisis could be about to get a lot worse” – Fortune Magazine

    “Soaring rents are a problem that will only get worse” – Business Insider

    “High rents are here to stay” – The Real Deal

    Bottom Line

    If you are thinking about buying a home and are financially positioned to do so, now may be better than later.

    You can download the entire white paper here: Projecting Trends in Severely Cost-Burdened Renters

    Source: Michigan Real Estate News, John Rice Realtor Latest Real Estate News

    Don’t Wait To Buy Your Dream Home

    Don’t Wait To Buy Your Dream Home

    As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As either a first-time or repeat buyer, you must not be concerned only about price but also about the ‘long term cost’ of the home.

    Let us explain.

    There are many factors that influence the ‘cost’ of a home. Two of the major ones are the home’s appreciation over time, and the interest rate at which a buyer can borrow the funds necessary to purchase their home. The rate at which these two factors can change is often referred to as “The Cost of Waiting”.

    What will happen over the next 12 months?

    According to CoreLogic’s latest Home Price Index, prices are expected to rise by 4.7% by this time next year.

    Additionally, Freddie Mac’s most recent Economic Commentary & Projections Table predicts that the 30-year fixed mortgage rate will appreciate to 4.7% in that same time.

    What Does This Mean to a Buyer?

    Here is a simple demonstration of what impact these projected changes would have on the mortgage payment of a home selling for approximately $250,000 today:

    Cost of Waiting | Simplifying The Market

    Source: Michigan Real Estate News, John Rice Realtor Latest Real Estate News