Archive | Real Estate Updates

Pending Home Sales Remain Steady

Pending Home Sales Remain Steady

Pending Home Sales Remain Steady | Simplifying The Market

The National Association of REALTORS’ just released the results of their latest Pending Home Sales Index, which showed a small 1.4% decline in signed contracts in August. Pending sales remain strong year-over-year as they were 6.1% higher than August ’14 and have now risen for 12 consecutive months. 

What is the Pending Home Sales Index (PHSI)?

NAR’s PHSI is “a forward-looking indicator based on contract signings”. The higher the Pending Home Sales Index number, the more contracts have been signed by buyers that will soon translate to sales.

In every major region of the country, pending sales are up year-over-year as shown by the graph below:

Pending Home Sales By Region | Simplifying The Market

What does this mean for the market?

Lawrence Yun, Chief Economist for NAR explained:

“Pending sales have leveled off since mid–summer, with buyers being bounded by rising prices and few available and affordable properties within their budget.”

There is no need to worry

Yun went on to say, “Even with existing–housing supply barely budging all summer and no relief coming from new construction, contract activity is still higher than earlier this year and a year ago.”

So What Does This Mean To Buyers?

There is a lot of competition out there right now for your dream home. Prices are going to continue to climb, act now before you are priced out of your future home. 

What Does This Mean to Sellers?

If you are on the fence about listing your home for sale and debating whether now is the time to move on with your plans of relocating… don’t wait!

There are more buyers that are ready, willing and able to buy their first, second, third, vacation, or investment property now than there has been in years! The supply of homes for sale is not keeping up with the demand of these buyers.

Listing your home for sale now will give you the most exposure to buyers and the best sales price. 

Bottom Line

Whether you are planning on buying or selling a house this year, waiting to act no longer makes sense.


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

Home Equity: You May Have More Than You Think

Home Equity: You May Have More Than You Think

CoreLogic recently released their 2015 2nd Quarter Equity Report which revealed that 759,000 properties had regained equity in the last quarter. That means that 91% of all mortgaged properties (approximately 45.9 million) are now in a positive equity position. Anand Nallathambi, president and CEO of CoreLogic, reported:

 

“For much of the country, the negative equity epidemic is lifting. The biggest reason for this improvement has been the relentless rise in home prices over the past three years which reflects increasing money flows into housing and a lack of housing stock in many markets.”

Obviously, this is great news for the financial situation of many homeowners.

But, do they realize their equity position has changed?

A recent study by Fannie Mae suggests that many homeowners are unaware that their equity position has changed…in some cases dramatically. For example, their study showed that 23% of Americans still believe their home is in a negative equity position when, in actuality, only 9% of homes are in that position.

The study also revealed that, though 69% of homes had “significant equity” (greater than 20%), only 37% of Americans realize it.

Significant Equity | Simplifying The Market

This means that 32% of Americans with a mortgage fail to realize the opportune situation they are in. With a sizeable equity position, many homeowners could easily move into a housing situation that better meets their current needs (moving to a larger home or downsizing).

Fannie Mae spoke out on this issue in their report:

“Homeowners who underestimate their homes’ values not only underestimate their home equity, they also likely underestimate 1) how large a down payment they could make with their home equity, 2) their chances of qualifying for mortgages, and, therefore, 3) their opportunities for selling their current homes and for buying different homes.”

Bottom Line

Every homeowner should be aware of the true equity in their house and also realize the opportunities that go along with it. If you are unsure of the savings you currently have built up in your home, let’s get together and discuss your current situation. You may be surprised.

A great place to start is right here:

Learn the current value of your home, quickly and easily
Source: Michigan Real Estate News, John Rice Realtor Latest Real Estate News

Sales Up In (Almost) Every Price Range!

Sales Up In (Almost) Every Price Range!

The National Association of Realtors’ most recent Existing Home Sales Report revealed that home sales were up rather dramatically over last year in five of the six price ranges they measure.

Only those homes priced under $100,000 showed a decline (-7.7%). The decline in this price range points to the lower inventory of distressed properties available for sale and speaks to the strength of the market.

Every other category showed a minimum increase of at least 5.6%, with sales in the $250,000- $500,000 range up 16.9%!

Here is the breakdown:

Sale Up In Almost Every Price Range | Simplifying The Market

What does that mean to you if you are selling?

Houses are definitely selling. If your house has been on the market for any length of time and has not yet sold, perhaps it is time to sit with your agent and see if it is priced appropriately to compete in today’s market.


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

#1 Reason to List Your House Today

#1 Reason to List Your House Today

If you are debating listing your house for sale this year or even early next year, here is the #1 reason not to wait!

Buyer Demand Continues to Outpace the Supply of Homes For Sale

According to the National Association of REALTORS’ (NAR) Foot Traffic report, there are more buyers out in the market right now than at any other time in the past three years.

The graph below shows the significant increase in foot traffic experienced this year compared to 2014.

Foot Traffic Year-Over-Year | Simplifying The Market

The latest Existing Home Sales report shows that there is currently a 5.2-month supply of homes for sale. This remains lower than the 6-month supply necessary for a normal market and well below August 2014 numbers.

The chart below details the year-over-year inventory shortages experienced so far in 2015:

Inventory Supply | Simplifying The Market

Bottom Line

Let’s get together to discuss the inventory levels in your neighborhood and discuss a plan to help you gain access to the buyers who are ready, willing and able to buy today!


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

How Quickly Are Homes Selling In Your State? [INFOGRAPHIC]

How Quickly Are Homes Selling In Your State? [INFOGRAPHIC]

How Quickly Are Homes Selling In Your State? [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • The National Association of REALTORS® surveyed their members for their Confidence Index
  • The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.
  • Homes sold in less than 60 days in 39 out of 50 states and Washington D.C.
  • Only Vermont had a median sold date longer than 90 days.


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

Is it Time to Downsize your Home?

Is it Time to Downsize your Home?

A recent study by Edelman Berland revealed that of homeowners who are contemplating selling their house in the near future 33% plan to scale down. Let’s look at a few reasons why that would make sense to many Americans.

In a recent blog post, Dave Ramsey, the financial guru, discussed the advantages of selling your current house and downsizing into a smaller home that better serves your current needs. Ramsey explains three potential financial advantages to downsizing:

  1. A smaller home means less space, but it also means less time, stress and money spent on upkeep
  2. Let’s assume you save $500 a month on your mortgage payment. In 30 years, you could have an additional $1–1.6 million in the bank to get you through your golden years.
  3. Use the proceeds from selling your current home to pay cash for a smaller one. Just imagine what you could do with no mortgage holding you down! If you can’t pay cash, aim for a 15-year fixed rate mortgage and put at least 10–20% down on your new home. Apply the $500 you saved from downsizing to your new monthly payment. At 3% interest, you could pay off a $200,000 mortgage in less than 10.5 years, saving almost $16,000 in the process.

Realtor.com also addressed downsizing in a recent article. They suggest you ask yourself some questions before deciding if downsizing is right for you and your family. Here are two of their questions followed by their answers (in italics) and some additional information that could help.

Q: What kind of lifestyle do I want after I downsize?

A: “For some folks, it’s a matter of living a simpler life focused on family. Some might want to cross off travel destinations on their bucket lists. Some might want a low-maintenance community with high-end upgrades and social events. Decide what you want to achieve from your move first, and you’ll be able to better narrow down your housing options.”

Comments: Many homeowners are taking the profit from the sale of their current home and splitting it to put down payments on a smaller home in their current location and a vacation/retirement home where they plan to live when they retire.

This allows them to lock in the home price and mortgage interest rate at today’s values. This makes sense financially as both home prices and interest rates are projected to rise.

Q: Have I built up enough equity in my current home to make a profit?

A: “For most homeowners, the answer is yes. This is if they’ve held on to their properties long enough to have positive equity that will be sizable enough to put a large down payment on their next home.”

Comments: A recent study by Fannie Mae revealed that only 37% of Americans believe they have significant equity (> 20%) in their current home. In actually, 69% have greater than 20% equity. That equity could enable you to build a life you have always dreamt about.

Bottom Line

If you are debating downsizing your home and want to evaluate the options you currently have, let’s get together to talk about the process.


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

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