Nov 10, 2014 | Market Outlook
Last week’s economic reports contained mixed reports indicating that the economy continues to recover with occasional “blips” in its progress. Construction spending was lower than expected.
A Federal Reserve survey of senior loan officers indicated that credit standards remain strict for mortgages and other types of lending. According to the survey, a “modest net fraction” of large banks had eased credit standards for prime mortgage lending.
First-Time Homebuyers Struggle as Market Share Hits 27-Year Low
The National Association of REALTORS® (NAR) reported that first-time buyers’ share of home purchases has slipped to 33 percent, which was its lowest level in 27 years. According to Lawrence Yun, chief economist for the NAR, high home prices and mortgage insurance costs along with strict mortgage credit requirements continue to sideline first-time buyers.
In other news, the Department of Commerce reported that construction spending dropped by 0.40 percent in September as compared August’s reading of -0.50 percent and an expected reading of +0.70 percent. September’s reading represented a seasonally-adjusted annual construction spending rate of $950.90 billion.
Mortgage Rates: Average 30-Year Mortgage Rate Tops Four Percent
Average mortgage rates rose last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage rose by four basis points to 4.02 percent. The average rate for a 15-year fixed rate mortgage rose by eight basis points to 3.21 percent, while the average rate for a 5/1 adjustable-rate mortgage rose by three basis points from 2.94 percent to 2.97 percent. Average discount points remained at 0.50 percent for all three types of mortgages.
This is not altogether bad news, as higher mortgage rates are typically prompted by improving economic conditions. 2014 started with an average rate for 30-year fixed rate mortgages of 4.05 percent.
Labor Reports Suggest Stronger Jobs Markets
Last week’s economic news included several reports that indicated improvements in U.S. labor markets. The Department of Labor released its Non-Farm Payrolls report for October with a reading of 214,000 jobs added against expectations of 243,000 jobs added and September’s reading of 256,000 jobs added. While this appears contrary to stronger labor markets, analysts said that a new low in the national unemployment rate of 5.80 percent indicated that fewer new jobs were needed. October was the ninth consecutive month reporting 200,000 or more jobs added.
The ADP employment report, which tracks payrolls in the private sector, reported an increase of 5,000 jobs from September’s reading of 225,000 jobs to October’s reading of 230,000 jobs.
Weekly jobless claims fell to 278,000 against expectations of 285,000 new jobless claims filed and the prior week’s reading of 288,000 new claims filed. This reading supports a stronger jobs market and may compel would-be home buyers to enter the market as concerns about unemployment and jobs wanes.
The national unemployment rate reached a new low with October’s reading of 5.80 percent. In related news, Fed Chair Janet Yellen indicated in a speech on Friday that the target Federal funds rate will likely rise in 2015, but she gave neither a prospective date nor details about how much the benchmark federal funds rate may rise.
Nov 7, 2014 | Home Mortgage Tips
If you’ve had some trouble getting approved for a mortgage recently, you’re not alone. Many individuals face mortgage challenges due to past blemishes on their credit reports or a personal financial crisis that resulted in bills not being paid on time.
In this post we’ll share three quick tips for sprucing up your personal credit before reapplying for a mortgage. With a bit of luck and hard work you can be on your way to purchasing that new dream home.
Pay Off Your Credit Cards And Lines Of Credit
The easiest way to improve your credit score and prove that you can afford your mortgage payments is to eliminate other forms of debt from your monthly budget. If you have outstanding credit card, student loan or other debts, get them paid off as quickly as possible.
You’ll also want to avoid taking on any new loans while you’re trying to get your mortgage approved as these are likely to show up on your credit report and can hurt your chances at approval.
Pull Your Credit Report And Look For Errors
If you haven’t seen your credit report recently, it might be worth investing in a copy so you can see exactly what your lender sees when they are evaluating you for a mortgage. You may discover that there are errors or inaccuracies that can be cleared off with a quick phone call, such as a past loan that was fully paid or a missed car payment that was reported in error. Every credit report error that you can fix will bring you one step closer to your mortgage approval, so spend a few minutes combing through your report.
Pay All Of Your Bills On Time
Did you know that every overdue bill can leave a negative mark on your credit report? With so many bills to juggle – credit cards, cell phones, utilities and more – it can be tough to keep them all organized and paid before the due date. However, if you’re working to secure a mortgage you must keep your bills paid to avoid being reported as a late or overdue payment.
If you’ve had some trouble getting approved for a mortgage in the past, take a moment to give me a call. I can put you in contact with some of the finest, professional and qualified loan officers in the area. My office represents hundreds of local and national mortgage lenders. I am certain I can find the right professional to assist you today.
David – 978-728-5104.
davidr@thebestclosings.com
Nov 6, 2014 | Home Buyer Tips
Are you moving to a new community or a new city? When you find a new house that meets your needs and seems like a perfect fit, you’ll want to take some time to meet your potential new neighbors before you sign on the dotted line.
In today’s blog post we’ll share a few reasons why meeting the neighbors can help you feel right at home in your new community.
Your Neighbors Are Experts on Your Local Community
Whether you have questions about the area’s safety at night or you simply want to know where the best coffee shops are, you’ll find that your neighbors are an excellent source of information about the local area.
Spend some time thinking about questions that you would want answered before committing to buy in a certain area, and ask the locals after you’ve viewed the home. Yes, you could ask the seller, but remember that it’s their goal to get you to buy the home and you’re most likely interested in impartial answers.
They Can Help the Kids Get Settled in
If you’re moving to a new city with children you’ll likely want to get them introduced to other neighborhood kids so they can start making new friends. Meeting your potential neighbors during the home buying process will allow you to determine which have children that are of a similar age as yours. Of course, if you find that there are no other children in the local community that might be a sign that the area isn’t very family-friendly, so you’ll want to factor this in as well.
You’ll Need to Assess Your Future Relations
If you decide to buy this particular new home you’re likely going to be living in the local neighborhood for years – perhaps even decades. Meeting the local neighbors before purchasing your home allows you to make an assessment of how well you’re going to integrate into the local community and whether or not you’ll be able to have warm relations with those that live around you. It takes just a few minutes of asking around friends and family to hear horror stories about bad neighbors; meeting the locals will help ensure that you don’t make a mistake that you’ll regret later.
When you’re ready to start your hunt for the perfect new home – and the perfect new neighbors – contact your local real estate professional. Working with an experienced real estate agent is the best way to get the home you’re after in a price range you can afford.
Nov 5, 2014 | Home Buyer Tips
You’ve found the perfect new house or condo, and you are now preparing an offer that you believe the seller will find tempting enough to accept. However, you know that there are going to be thousands of dollars in closing costs that need to be paid before the sale is completed and you become the home’s new owner.
The question is, should you ask the seller to pay some or all of the closing costs? In today’s blog post we’ll address this question and list a few scenarios in which you may want to consider having the seller pick up the tab.
Ask if You’re Offering the Full Listing Price
If you’re prepared to offer the full asking price for the home you can certainly include the caveat that the seller assist with some or all of the closing costs. Many sellers will price their home slightly higher than they expect to receive as they believe that buyers will submit low initial offers which need to be negotiated.
For example, if a home is listed at $275,000 a seller might actually be expecting $260,000 or $265,000 for it. You can offer $275,000 but ask that they take care of the closing costs.
Ask if You’re Confident the Seller Has Few Other Options
If the home has been on the market for a number of months or if you’re fairly confident that the seller isn’t going to find much luck elsewhere you can ask them to pick up the closing costs as one of your purchase conditions. You’ll obviously want to negotiate in good faith, but if you’re coming from a position of strength you can leverage this in to some additional savings.
Ask if You’re Ready to Close Immediately
Are you ready to sign on the dotted line today? If you’re sure that this is the right home for you, let the seller know that as long as they’re willing to assist with the closing costs and accept your bid that you’ll start the closing process today. Nearly all sellers will be willing to make a small sacrifice to get the deal done.
As you can see, there are a number of situations in which it makes sense to ask the seller to shoulder some of the closing costs. If you have found a home that you wish to purchase and you’d like advice on how to proceed, contact a real estate agent today. An experience real estate professional can help you craft an offer that the seller won’t be able to refuse.
Nov 4, 2014 | Home Seller Tips
Are you thinking about selling your house or condo? If you’re in a market that has a lot of newly constructed homes, you’re going to be competing with those listings for buyers’ attention.
In today’s post we’ll share a few tips that can help you attract buyers and convince them that your pre-owned home is just as good as a brand new one.
Upgrade And Modernize Your Home Prior To The Sale
Numerous studies have shown that buyers who prefer brand new homes are mostly interested in the new appliances and fixtures throughout the home.
If your home is more than a decade or so old, you’ll want to invest some time and money in upgrading your appliances and fixtures before trying to list your home on the market.
If you have newly constructed homes very close to yours it might be worth installing these items after you’ve moved out so that the buyer is the first person to use them.
Focus Your Marketing On A Specific Buyer
Depending on which neighborhood your home is located in and the local amenities, you may want to consider focusing your marketing on one particular buyer. For example, a downtown condo would be marketed to a completely different prospective buyer than a large four-bedroom home out in the suburbs. Take some time to consider the “persona” of your target buyers, and craft your messaging around what these individuals or families will be looking for in their dream home.
Shine The Spotlight On Your Home’s Strong Points
As with any major sale, you’ll want to ensure that you spend as much time as possible highlighting the strong points in your listing. Be sure to mention any local community amenities as well, such as schools, parks or community centers. If you’re selling to a family, your proximity to these amenities will be a significant point of comparison with brand new homes in the area.
If you have the budget, you may also want to consider having your home professionally staged, as staging is an excellent way to show a potential buyer just how good your home can look with tasteful furnishings, art and other finishing touches.
Selling your home is a challenging proposition that shouldn’t be faced alone. When you’re ready to sell your home be sure to contact your local real estate agent, who has experience selling in your local market and can help to ensure your sale moves along smoothly.
