Mar 8, 2019 | Real Estate
Hunting for your new home can be a confusing process. There are countless factors you need to take into account to ensure your new location fits your family’s lifestyle and preferences. In their excitement, first-time home buyers can easily overlook some essential points about their potential property.
When you’re searching for your new residence, ask these questions to get exactly what you’re looking for.
Am I Financially Ready For A New Home Purchase?
It takes more than money to find the right home. Your credit rating is an important factor in your ability to secure enough funding to finance your dream. Check out your credit score before you buy to make sure you won’t have to settle for less.
Some of the things you have the greatest control over include:
- Payment history
- Credit utilization ratio
- Debt-to-income ratio
Even with a large down payment, having a questionable credit history can endanger your chances of qualifying for mortgage loans. Spend some time shining up your credit report for the best results. Getting a pre-approved home loan is a great way to find out how much house you can afford before you start shopping.
Is This The Right Neighborhood For Me?
No matter how beautiful the structure itself is, your house won’t seem like a home unless you’re comfortable with the surrounding neighborhood. Take a walk around your potential block to assess the area and compare it to your needs.
- For families with children, are there high-quality schools in the area?
- Do your neighbors’ homes seem well-kept?
- What amenities (dry cleaner, grocery stores, parks, etc) do you want in your community?
- How do the roads and sidewalks look?
Before committing to a purchase, visit the home at different times of the day to get an idea of what you might have to live with.
Am I Ready To Settle Down?
Align your home purchase with your future goals. If you know you’re planning to move out-of-state in the next several years, take that into account when shopping for a home. Will you be able to sell quickly enough before you leave? Or do you plan to retain ownership of the home and rent it out while you’re away?
Think about the directions your life might take in the next 5 to 10 years. By looking ahead, you can make a better plan for the best home you can afford which will accommodate you and your family in the years to come.
Buying your first home is a major decision. Knowing your goals, desires, and abilities before agreeing to a purchase a home will make you the most comfortable moving forward.
One of the best partners in your home search will be your trusted real estate professional. Be sure to make contact as soon as you are considering a new home purchase.
Mar 1, 2019 | Real Estate
The success of your real estate ventures depend on your ability to navigate the financial world. Learn these terms to make it easier to understand what’s going on with your real estate investments.
Cash Flow
Contrary to popular belief, cash flow isn’t just the amount of liquid assets you have available. Your cash and unused lines of credit are an essential indicator of your ability to complete projects and pay the cost of ongoing operations. However, these factors don’t tell the whole financial story.
Your actual cash flow is the difference between your gross income and your financial obligations. You can have a large cash reserve but still have a negative cash flow if you aren’t making enough to cover your obligations.
Gross Yield
When evaluating potential properties, it’s helpful to understand the gross yield. To calculate gross yield, divide the annual income you expect the property to produce by the property’s price. This number comes in handy for comparing properties and narrowing down your options.
Amortization
Lending institutions offer a variety of loan structures to fit your goals and financial standing. An amortized loan features a set amount of interest. This amount is integrated into each monthly payment. That means that borrowers are paying on the loan’s principal and paying down their interest liabilities from the very first payment.
Amortization is an excellent way to quickly build equity. This enables real estate investors to use existing properties to fund other projects without having to sell off their holdings.
Carrying Costs
Flippers and other short-term real estate investors need to keep a close eye on their carrying costs. These are all the expenses incurred after the initial purchase and before the property is sold for profit. Carrying costs include mortgage and interest payments, utility bills, taxes, and insurance.
The best way to limit carrying costs is to flip your property as quickly as possible. However, sudden changes in the market, illness, and other unexpected factors can prolong your need to make monthly payments. In this event, investors should carefully monitor their cash flow to ensure they don’t end up losing their entire investment.
Double Close
Wholesale home buyers often already have an exit strategy before signing on new properties. In this case, a double closing allows the wholesaler to purchase the property and sell it to a new buyer in a single transaction. This is also sometimes called a back-to-back closing.
Knowing these terms will make it easier for you to manage the financial details of your real estate investments. And partnering with a trusted real estate professional will make it easier for you to find just the right investment property.
Feb 28, 2019 | Real Estate
If you find it difficult to make ends meet, these tips will help you save money in ways that are easy to do and create substantial savings over time.
Declutter
Get rid of stuff you do use or need by having a garage or yard sale or by putting things for sale on eBay or Craigslist.
Make Your Own Coffee
Do you really want to make that billionaire richer by buying coffee for $5+ a cup? Make your own gourmet coffee that costs around 50 cents per cup for the same thing.
Bring Your Own Lunch
Making your lunch the night before to take to work the next day will give you more time to enjoy lunch. You will save the money that is wasted when driving to fast-food restaurants or going to pricey lunch places.
Grow Some Food
Everyone should have a garden, even if it is only a window garden for herbs. If you have some room for pots, you can grow tomatoes and other vegetables. If you have a back yard or a front yard you can grow tons of stuff.
Buy In Bulk And Use Coupons
For the things that you use on a regular basis, stock up when the items are on sale. Buy things at discount stores. Buy bulk things like rice and pasta at wholesale prices in co-ops. Coupon clipping is a hobby that pays for itself in savings. Just be careful not to buy things you do not really need or use.
Change Home Lighting
If you have not yet changed out all your incandescent bulbs to compact fluorescent bulbs, what have you been doing? Change those bubs right away because you are burning up money on wasteful lights.
Install Smart Home Technology
Making a home run with more energy-efficiency is reduces your bills and helps the planet too. Smart home technology monitors comfort zones and turns things off when they are not needed.
Cut The Cable
An expensive monthly bill for cable TV is something many can do without. There are plenty of less expensive alternatives and tons of free content to view online.
Make A Change Jar
Every time you come home, put all the change you have in a change jar. You will be surprised how much money builds up over time and you will hardly even notice it is missing.
Walk Instead Of Drive
Do you have to drive your car everywhere? Try walking short distances instead. Not only will you save money on gas; walking may improve your health.
DIY Projects
Instead of paying others to do simple jobs around the house, do them yourself. There are plenty of do-it-yourself (DIY) guides on YouTube that show how to do just about anything. You will save the expensive labor cost for simple home repairs that can be up to $75 per hour.
Are you inspired? OK. Put some of these ideas into action. Ready, set, save!
Your trusted real estate professional is a skilled negotiator. Be sure to utilize this savvy resource as soon as you are considering a new home purchase.
Feb 27, 2019 | Real Estate
Case-Shiller Home Price Indices reported the slowest rate of U.S. home price growth since November 2014. According to the 20-City Home Price Index, Home prices grew by 4.20 percent year-over-year and were 0.20 percent higher in December as compared to November. The 20-City Home Price Index fell short of analysts’ expected gain of 4.80 percent year-over-year. Case-Shiller’s National Home Price Index reported home prices increased 4.70 percent in the fourth quarter of 2018.
While home price growth is sluggish, home prices continued to rise faster than wages. This creates obstacles to affordability for many would-be home buyers. Fears about rising mortgage rates and inflation, also concerned would-be home buyers seeking affordable homes.
20-City Home Price Index: Home Price Growth Rose In Only 5 Metro Areas
Las Vegas, Nevada led in home price growth for December with a year-over-year increase of 11.40 percent. Phoenix, Arizona home prices rose 8 percent year-over-year, and Atlanta, Georgia home prices increased by 5.90 percent. Home prices in west coast cities including San Francisco, California and Seattle, Washington grew at a slower pace than in prior years, which could indicate that high-demand metro areas are approaching peak home prices.
December home price growth surpassed November readings in five cities tracked in the 20-City Index. Three cities reported no change in month-to-month home prices growth. David M. Blitzer, Chair of the S&P Dow Jones Index Committee, acknowledged that year-over-year home prices continued to fall despite the prior assertion that housing markets were not approaching “bubble” conditions seen in the Great Recession.
Serious Headwinds Face Prospective Home Buyers
According to data compiled by the National Association of Realtors®, 27 percent of prospective home buyers surveyed at the end of 2017 believed that they would face fewer challenges to finding and buying a home in 2018. Prospective buyers surveyed in late 2018 who planned to buy within the next year decreased from 24 percent to 13 percent. Combined impacts of high home prices, potential increases in mortgage rates and strict mortgage requirements discouraged some would-be buyers, but whether this is a short or long-term trend will depend on factors including inflation, wage growth and inventories of homes for sale.
Market conditions can vary by location. Please be sure to consult with your trusted real estate professional to find out about market specifics in your area.
Feb 26, 2019 | Real Estate
The real estate market and all the things involved in selling a home can seem complicated, and it can be very hard to know which tips to trust. While there’s plenty of great advice to go around from many knowledgeable sources, here are some of the best tips from home sellers who have made a successful sale.
Research Your Local Agents
When considering an agent that will meet your home-selling needs, it can be tempting to go with someone familiar or recommended through a friend who seems like a safe bet. However, it’s important to do some of your own research. Create a list of agents you’re impressed by and take note of their sales and agent fees. Keep in mind that you may want to lean towards an agent who has expertise in your neighborhood.
Get A Second Opinion On Price
Before you have an agent appraise the value of your home, it’s worthwhile to do some research on your end to determine the approximate value of your property. Once you’ve arrived at a figure, bring in the agents you’ve selected to appraise the value of your property. If one price is significantly higher than the other, it may be a sign that an agent is trying to win over your business. Most agents are in tune with the current market and should be able to guide you toward the most appropriate market price.
Be House Ready At All Times
Having potential buyers view your home will certainly make the idea of selling it real, so make sure that it is ready for viewing at any time. If a potential buyer cannot view your property or has to work around your schedule constantly to arrange viewings, there’s a pretty good chance that you may lose out on some good home offers. Instead of missing out, provide a set of keys to your real estate agent so they can show people around your home when you’re not around. This should automatically increase the likelihood of an offer on your home.
Heading into the real estate market can be a matter of trepidation if you’re not sure what to do, but by doing some research and being prepared you’ll increase your chances of success. As soon as you begin to consider putting your home on the market, be sure to contact your trusted real estate professionals for more information and expert guidance.
Feb 22, 2019 | Real Estate
After raising the target range for the federal funds rate in 2018, the Fed’s Federal Open Market Committee did not raise the Central Bank’s key interest rate at its meeting of January 29 and 30. While Committee members did not raise the Fed’s key rate, members were divided on the interest rate decision.
FOMC Members Divided On Interest Rate Decision
Minutes of January’s FOMC meeting indicated that member viewpoints varied about how the Fed should deal with the Fed’s target interest rate range. One group said that interest rate increases may be necessary if inflation increases above the Federal Reserve’s baseline forecast.
Other FOMC members supported raising the Fed’s interest rate range later in 2019 if economic conditions move as expected. Overall, FOMC members said that there were “few risks” in the Committee’s current position of patience, but they were open to reassessing that position according to how economic conditions change.
FOMC Cites Reasons For Halting Rate Increases
Committee members provided several reasons for reversing their 2018 policy of consistent rate hikes including declining economic conditions since early 2018. Global and domestic economic conditions slowed; deteriorating conditions were supported by lower readings on consumer and business sentiment. Federal government policies including the partial government shutdown and then-current trade policy contributed to the deteriorating economic outlook in late 2018.
Ongoing influences driving FOMC monetary policy decisions include the Fed’s mandate for achieving maximum employment, stable prices and moderate long-term interest rates. Because short-term data change frequently, Fed monetary policy reflects long-term goals, medium-term outlook and the Committee’s risk assessments in multiple financial and economic sectors. The Committee said that long-term inflation of two percent indicates stable pricing as required by federal mandate; any prolonged deviation above or below the two percent reading would concern Committee members.
FOMC indicated progress with its maximum employment mandate by changing its long-run unemployment outlook from 4.60 percent to 4.40 percent, which suggests a strong outlook for job markets. Fourth quarter Gross Domestic Product was described as “solid”. The meeting minutes indicated that some data typically used by Committee members was limited by the government shutdown.
