Oct 11, 2019 | Real Estate
It’s the time of year when many people are making their holiday plans: booking travel, making shopping lists, and getting their home ready for guests. Hiring a house cleaner, having the carpets steamed, and buying new furniture ahead of the holiday season are all common, but what about completely updating a room (or two)?
It’s easy to think that home improvement projects are too expensive or will take several weeks or even months to complete. However, there are several simple, affordable do-it-yourself projects that can be completed in a weekend to give outdated rooms a fresh new look — in plenty of time to host holiday guests.
Refinish Kitchen Cabinets The Easy Way
Painting cabinets is an excellent way to totally transform a kitchen. This fun budget-friendly project can be done in a weekend or spread out over a couple of weeks if necessary. With adequate preparation and attention to detail, the “new” cabinets will look great for years to come.
Minimal supplies are necessary for this project and there is no limit to the looks that can be created using different paint colors, stains, and seals.
Create A Shiplap Accent Wall
Arguably one of the most popular home decor trends is the rustic farmhouse look, and shiplap is at the center of that. Using basic tools that are likely already in the garage and some plywood from the local hardware store, it’s easy to create a unique shiplap wall and dramatically change the look of a room.
The most fun part about DIY shiplap is that it’s so customizable. Use reclaimed or pallet wood, paint unfinished planks, or try using boards cut to different lengths.
Update Flooring With Vinyl Or Laminate
Replacing outdated flooring is perhaps the biggest bang-for-the-buck DIY project that can drastically freshen up a space. Changing the floors in even one room can have a tremendous impact on the look of the entire home.
With so many budget-friendly options such as click-together laminate panels and peel-and-stick vinyl tiles, choose different looks for different rooms or go for one cohesive look throughout the house.
Giving a home an entirely new look doesn’t have to involve a complicated renovation project. Major home improvement stores and websites have step-by-step tutorials to make it as simple as a few coats of paint and some elbow grease.
If you are in the market for a new home or interested in listing your current property, be sure to contact your trusted real estate professional.
Oct 10, 2019 | Real Estate
Condominium owners and buyers have previously been at a disadvantage when trying to use the Federal Housing Authority (FHA) support to get a home mortgage. Single-family homes could get better FHA mortgage deals than condominiums. In October 2019, this changes.
New FHA Condominium Financing
As of October 15, 2019, FHA loan availability is extended to condominium buyers. This is important news for first-time buyers who frequently purchase a condominium. First-time buyers appreciate FHA loans because they only require a very modest 3.5% down payment.
FHA loans were strongly curtailed after the real estate market collapse in 2008. Since 2009, most condos did not qualify for FHA loans. The problem was that FHA loans require mortgage insurance and this insurance was only available for about 6.5% of all condos.
In America, there are about 160,000 condominium projects (complexes and buildings). The new FHA program makes mortgage insurance possible for about 20,000 to 60,000 more condominium projects nationally. Not all condos will qualify for the new FHA program; however about half of them will.
Both first-time buyers and people who are down-sizing by selling a larger home appreciate condos. The median price for a condo nationally is around $260,000. This is about $29,000 less than the median price for a home that is about $289,000. Maintenance costs and upkeep for a condo are typically less than caring for a larger home.
Refinance Opportunities
For condo buyers, who could not get FHA loans in the past, they may now qualify for the mortgage insurance needed if they could not get it before. Then, they can refinance a loan to get a better deal with FHA financing if they want to do this.
Easier Condominium Sales
For those who are putting their condos on the market for sale, this new FHA loan program is worthwhile to investigate to see if the condominium building or complex qualifies. If the condo is in a facility that qualifies, this new FHA financing option will potentially attract more buyers
Summary
Real estate agents should become aware of the new FHA program and inform their clients if a condo buyer can use an FHA loan to finance the purchase. This is a very impactful change for the condominium market dynamics. This new FHA loan program is the first of its kind to occur since around 2009, a decade ago, which is great news for condo buyers.
If you are in the market for a new home or interested in listing your current property, be sure to contact your trusted real estate professional.
Oct 9, 2019 | Mortgage
For a long time after the real estate housing crisis in 2008, buyers with a poor credit history had a difficult time finding mortgage financing. It was a problem that trapped those seeking to buy a home because so many lost their homes from the inability to pay their mortgages.
Some suffered damage to their credit history that was severe. Millions filed for bankruptcy.
Not only did mortgage lending requirements get stricter for home buyers, but the funds available for home loans were also severely reduced. Even those with a good credit history found it more difficult to qualify for mortgage financing.
Time For A Second Chance
Now, there is a much better environment for homebuyers with a bad credit history who are seeking a loan. Those with a bankruptcy on their record, which was settled at least ten years ago, will see the bankruptcy taken off their credit history. Suddenly, their credit score may increase dramatically.
Unconventional Financing
Conventional financing is available for those with decent credit. This includes attractive terms and conditions for FHA loans and other federally-based loan programs. Those with bad credit may not qualify for these loans. If they want to buy a home, their only option is to use unconventional financing, also called non-qualified mortgages (non-QM).
Unconventional financing has higher costs and no federal insurance. In 2008, these non-QM loans were a total of $65 billion per year. In 2009, this figure dropped to $10 billion and, in 2010, the low of $8 billion.
Since 2010, the availability of these non-QM loans steadily increased. By 2018, the total amount of these loans was up to $45 billion. That figure will be higher in 2019.
Is There Another Real Estate Bubble Happening?
Are we back to where we were before when the real estate market collapsed in 2008? As far as the total amount of non-QM loans, we are close. However, the qualifying standards for these loans are stricter than a decade ago.
There is less predatory lending where borrowers who do not truly qualify get a no-doc loan without proving income. Before those predatory loans often had a teaser introductory rate that quickly escalated to an amount that made it impossible for the home buyer to continue to make their mortgage payments. There are fewer of these loans now.
Summary
Besides the big picture real-estate-bubble worries, the positive news is that borrowers with a poor credit history can now participate in the housing market again.
Be prudent when considering a mortgage and carefully think about the ability to make the monthly payments. Read all the details of the loan requirements carefully. Use competent professional advice from a trusted home mortgage professional to make sure there is a very clear understanding of the loan terms and conditions.
When you have your financing secure, be sure to consult with your trusted real estate professional to help you find your new home.
Oct 8, 2019 | Mortgage
The mortgage interest rate represents the cost of borrowing money to purchase a property. Mortgage interest rates are not fixed; that is, they fluctuate from one period of time to the next.
Many different factors play into what your mortgage interest rate will finally turn out to be. Some of these factors have to deal with the economy and government decisions. Other factors have to do with your personal financial situation.
Finally, mortgage interest rates can differ between lending institutions, which is why you may get different mortgage interest rate quotes from different places.
Economic Factors That Cause Mortgage Interest Rates To Fluctuate
Mortgage interest rates are somewhat connected to the stock market. When the stock market indexes go up, mortgage rates tend to rise as well. The Consumer Price Index is a measure of inflation rates. When inflation rises, you can expect to see mortgage interest rates go up, too. Other economic factors that affect mortgage interest rates include Data from the Gross Domestic Product, Consumer Confidence, and Home Sales reports.
Government Decisions That Lead To Mortgage Interest Rate Changes
The federal government keeps close tabs on the economy. Government officials are always making adjustments in order to keep the economy strong. Periodically, the government will raise or lower key interest rates in order to adjust bank lending economics. When the government raises or lowers the Federal Funds interest rate, it is always announced in the media.
Personal Financials And Your Mortgage Interest Rate
Finally, your personal financial situation influences what kind of mortgage interest rate your lender offers. A higher credit score will generally get you a lower mortgage interest rate. This is another reason why it’s always a good idea to review and improve your credit score before applying for a mortgage.
When you are ready to apply for a mortgage, meet with a trusted home mortgage professional. Because mortgage interest rates fluctuate often, you could find that the interest rate gets higher in the short time in which you’re still shopping for your home. Once you do find an attractive program for your personal situation, be sure that you are ready to take the necessary steps to lock in that rate.
If you are interested in buying a new home or listing your current property, be sure to contact your trusted real estate professional.
Oct 7, 2019 | Financial Reports
Last week’s economic news included readings on construction spending, and labor reports on public and private sector jobs and the national unemployment rate. Weekly reports on new jobless claims and mortgage rates were also released.
Construction Spending Ticks Up in August
Commerce Department reporting on construction spending showed 0.10 percent growth in August as compared to a revised flat reading for July. Construction spending hit a seasonally-adjusted annual rate of $1.29 trillion for August. Analysts expected 0.40 percent growth, which was based on the original July reading of 0.10 percent growth.
Residential construction spending rose 0.90 percent in August ; public construction spending rose 0.40 percent for the month. Factors impacting residential construction spending include rising costs of building materials, winter weather conditions and mortgage rates
Mortgage Rates Little Changed; New Jobless Claims Rise
Freddie Mac reported mixed activity with mortgage rates last week. Rates for 30-year fixed rate mortgages rose one basis points to an average of 3.65 percent. Rates for 15-year fixed rate mortgages averaged 3.14 percent and were two basis points lower.
The average rate for 5/1 adjustable rate mortgages was unchanged at 3.38 percent. Discount points averaged 0.60 percent for 30-year fixed rate mortgages and 0.50 percent for 15-year fixed rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.40 percent.
First-time jobless claims rose to 219,000 claims filed and surpassed expectations of 218,000 new claims. 215,000 first-time claims were filed the prior week.
Jobs Growth Slows; National Unemployment Rate Drops
September jobs reports showed fewer jobs available for public and private sector employers. The federal government’s Non-Farm Payrolls report showed 136,000 jobs added as compared to an expected reading of 150,000 jobs added and the previous month’s reading of 168,000 public and private sector jobs added.
ADP reported 135,000 private-sector jobs added in September as compared to 157,000 jobs added in August. The national unemployment rt rate dropped to 3.50 percent in September.
What’s Ahead
This week’s scheduled economic news includes readings on job openings, minutes of the most recent FOMC meeting, and reports on inflation and consumer sentiment. Weekly reports on mortgage rates and new jobless claims will also be released.
