Category: Real Estate

Why you should stage your home if you want to sell it

They say you only get one chance to make a first impression, and that may never be more true than when selling your home. Most sellers make an effort to clean up their home before showing it, but another action could help to decrease the time it takes to sell a home.

Home staging, according to the vast majority of Realtors, can make a lasting impression on potential buyers — even helping to increase the amount of money offered for the home.

According to a new report from the National Association of Realtors, over 95 percent of buyer’s agents say that home staging has at least some effect on the buyer’s view of the home. Houses that make it easy for buyers to visualize themselves living there are more likely to sell quickly, according to realtors.

Most important rooms to stage

Most realtors polled agreed that the living room is the most important room to stage, followed by the master bedroom, the kitchen, and then the yard or outdoor space. The guest bedroom was considered the least important room to stage.

Sixty-two percent of Realtors said staging a home decreases the amount of time it spends on the market. But other efforts can also expedite the process.

The following pre-sale home improvement projects can make a big difference, according to Realtors:

• Decluttering. 93 percent of Realtors recommend decluttering the home
• Home cleaning. 89 percent recommended an entire home cleaning.
• Carpet cleaning. 81 percent recommended that sellers have their carpets professionally cleaned.
• Other projects. Depersonalizing the home, removing pets during showings, and making minor repairs can also help a home sell faster.

Home staging tips

A home’s staging should ideally be designed to appeal to the largest number of potential buyers. To make it easy for buyers to visualize themselves living in your house, the home experts at Houzz recommend striking a balance between clean and lived in. 

 

You’ll still want to declutter. However, adding a few homey touches can increase your home’s appeal. Before a showing, consider putting out a vase of fresh flowers, a bowl of lemons, or a basket of produce on the kitchen counter.

 

Another tip for appealing to the widest range of buyers: choose “sophisticated neutral” interior paint colors, like mocha and “greige.” These tones “create a sophisticated backdrop that makes everything look pulled together,” say the experts at Houz

The True Impact of Home Staging | Realtor Magazine

Sixty-two percent of listing agents say professional staging decreases the amount of time a home spends on the market, while 40 percent of buyer’s agents say their clients are more willing to walk through a home that has been staged, according to the National Association of REALTORS®’ 2017 Profile of Home Staging.

“REALTORS® know how important it is for buyers to be able to picture themselves living in a home, and staging a home makes that process much easier for potential buyers,” says NAR President William E. Brown. “While all real estate is local and many factors play into what a home is worth and how much buyers are willing to pay for it, staging can be the extra step sellers take to help sell their home more quickly and for a higher dollar value.”

Thirty-one percent of respondents to NAR’s survey say staging increased the dollar value of a home they sold by 1 percent to 5 percent; 13 percent of respondents say it increased a home’s dollar value by 6 percent to 10 percent. Agents on both the buying and selling side agree that the living room is the most important part of a home to stage, followed by the master bedroom, kitchen, and outdoor space. 

Thirty-eight percent of listing agents say they stage every one of their sellers’ homes before listing them. Fourteen percent say they will only stage homes that are difficult to sell, while 7 percent say they only stage homes in higher price brackets. However, 37 percent of listing agents say they do not stage homes at all before listing them. Instead, they say they make recommendations to sellers to declutter their homes and fix any issues.

Agents who stage say the seller pays for the staging 25 percent of the time, according to the survey. Twenty-one percent say they have provided funds to stage a home. Fourteen percent of agents say they offer home staging services to sellers.

Mortgage Rates Post Biggest Jump in Months | Realtor Magazine

 

 

The 30-year fixed-rate mortgage this week made its biggest increase since March, moving closer to a 4 percent average, Freddie Mac reports.

“Global interest rates turned up sharply over the last week,” says Freddie Mac chief economist Sean Becketti. “The 10-year Treasury yield was no exception, increasing 10 basis points in a holiday-shortened week. The 30-year mortgage rate followed suit, rising 8 basis points to 3.96 percent.”

Freddie Mac reports the following national averages with mortgage rates for the week ending July 6:

• 30-year fixed-rate mortgages: averaged 3.96 percent, with an average 0.6 point, increasing from last week’s 3.88 percent average. Last year at this time, 30-year rates averaged 3.41 percent.
• 15-year fixed-rate mortgages: averaged 3.22 percent, with an average 0.5 point, rising from last week’s 3.17 percent average. A year ago, 15-year rates averaged 2.74 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 3.21 percent, with an average 0.5 point, increasing from last week’s 3.17 percent average. A year ago, 5-year ARMs averaged 2.68 percent.

4 Expenses Your Buyers Don’t Expect | Realtor Magazine

Buyers need to reserve the equivalent of about 2 percent to 5 percent of a home’s purchase price for closing costs, such as appraisal, lender, and title fees. But that’s only a portion of extra homeownership expenses.

Nearly half of home shoppers say they faced more than $2,000 in unexpected charges during the homebuying process, according to a survey by TD Bank. Ten percent spent at least $5,000 more than they originally expected. So make sure your clients are aware of these extra expenses.

Home inspection fee. Home buyers will want to have the home evaluated by an inspector prior to closing, which may cost about $300 to $500. If any problems are detected, they also might need to hire a specialist for further investigation.

Extra cash at closing. Many lenders require purchasers to pay a year’s worth of taxes or the equivalent percentage of the mortgage upfront. The seller may have prepaid any taxes or homeowners association fees, which means the buyer will then have to pay the seller a prorated amount for the remainder of the quarter or year. “Once you’re done with all the fees and the deposits for reserves, you may end up bringing many more thousands of dollars than you thought to the closing,” says Keith Gumbinger, vice president of mortgage website HSH.com.

Moving costs. Professional movers often cost a few thousand dollars. CNNMoney recommends gathering several quotes from companies and making sure to hire someone who is licensed by the Federal Motor Carrier Safety Administration.

Immediate costs. Encourage your clients to set up an emergency savings account with at least six months of expenses in the case of unexpected events such as a leaky roof or a broken water heater.

Mortgage Rates Start Summer Near 2017 Lows … Will It Hold? – Zillow Porchlight

What is a Fed rate hike, anyway?

The Fed Funds Rate is an overnight bank-to-bank lending rate. While this rate isn’t available to consumers, the Federal Reserve (America’s central bank) uses it to help influence overall rate levels in the economy.

When times are tough, the Fed lowers the Fed Funds Rate to stimulate the economy. In the heat of the 2008 financial crisis, it cut the Fed Funds Rate all they way down to .25 percent, and kept it there until December 2015, when it felt the  economic recovery had solidified.

Then it started hiking in increments of .25 percent, and have done so four times: December 2015, December 2016, March 2017, and June 2017.

Even though the Fed Funds Rate has now risen to 1.25 percent, traditional mortgage rates haven’t risen much — and, in fact, are near 2017 lows as summer kicks off.

Certain mortgages are already up 1%

When we say “traditional mortgage rates” are holding near 2017 lows, we mean rates on primary mortgages that most people get on their homes.

However, one mortgage product that’s directly impacted by these Fed hikes is the Home Equity Line of Credit (HELOC).

HELOC rates are based on two components: a set base rate called a “margin,” plus a fluctuating rate called an “index.”

The index for HELOCs is the Prime Rate, which is a rate that is directly tied to Fed Funds. In fact, the Prime Rate is the Fed Funds Rate plus 3 percent.

We know that the Fed Funds Rate is now 1.25 percent after recent hikes. This means that the Prime Rate is now 4.25 percent.

Therefore anyone with a HELOC now has a rate of 4.25 percent plus whatever their margin is. Margins are typically somewhere between zero and three percent in addition to Prime, and your margin is based on your credit quality and how much or little you’re borrowing relative to the price of your home.

HELOC rates rising 1 percent because of recent with Fed hikes means that your monthly interest cost on a $100,000 HELOC is now $83 more per month.

If have or need a HELOC to get cash out of your home but don’t want to risk your rate rising further, here’s how to evaluate the difference between a HELOC, home equity loan, and a cash out mortgage.

Traditional mortgages are holding at 2017 lows

The reason rates on primary mortgages most people get haven’t spiked like HELOC rates is because primary mortgage rates are tied to trading in mortgage bonds, not the Fed Funds Rate.

Most U.S. mortgage loans up to $424,100 are packaged into mortgage bonds, and these bonds trade daily in global markets. Mortgage rates fall when prices of these bonds rise on economic uncertainty, and vice versa.

Rates have been holding near 2017 lows as demand for mortgage bonds remains strong. The reason for this demand is that these bonds are considered a safe investment when policy initiatives in Washington and global economic growth looks uncertain (like it does now).

Where do mortgage rates go from here?

Thirty-year fixed mortgage rates on loans up to $424,100 are currently at or just below 4 percent as of  this writing — please note mortgage rates change throughout each day.

The Mortgage Bankers Association updates its rate forecasts monthly, and the June forecast calls for rates to rise very slightly — about .125 percent to .25 percent — from current levels as we move through the summer. And they call for rates to be around 4.375 percent as we move into the holidays.

These projections can change monthly as the economic and political environment evolves in the U.S. and globally, but for now you can see that rates might rise by about .375 percent by year end.

On a $300,000 loan, this would mean your payment rising by $66.

Not that $66 is small, but in the context of the global rate market, this is a relatively small increase that shouldn’t fundamentally alter how much home many people qualify for.

Renovations with the best resale value | At Home Magazine | postbulletin.com

Even though buyers are competing with each other to buy your home, that doesn’t mean you should leave money on the table by skipping some renovations that will bring you some serious ROI. 

New windows

Windows are one of the most daunting things to repair mainly due to cost. If you have an older home with deteriorating windows, expect it to affect your sales price. It’s an easy thing for the average buyer and their inspector to pinpoint as a problem. Whether you’re replacing your older windows with vinyl or wood, you’ll likely get about an 84 percent rate of return. 

 

Bathroom remodel

Bathrooms are what buyers focus on the most while looking for their dream home. It’s got to be fashionable and functional. Since this type of renovation can be on the expensive side, it’s normal for buyers to seek out properties that already have updated bathrooms. You can rest easy knowing your bathroom renovation will give you roughly a 75 percent rate of return on your investment. 

 

Curb appeal

The type of curb appeal you’re used to hearing about is typically cosmetic landscaping. When it comes to real ROI on your renovations, we’ve got to go a bit further. Replacing your siding if it’s outdated, worn, or damaged will rake in an 87 percent rate of return on your investment. Roofs are a huge concern for homebuyers, so with a 74 percent rate of return, it’s a really good idea for you to complete a renovation on your outdated or damaged roof.

Kitchen remodel

The most common upgrades to make in your kitchen would be countertops, cabinets, and appliances. Countertops will increase the perceived value quite a lot but this type of renovation will cost you. It’s important when choosing a new countertop to think about resale. Stick with a neutral color and pattern that complements the colors you already have in the home. 

If your cabinets are falling apart and obviously in need of repair or replacement, it’s smart to do so prior to listing. If buyers see dilapidated cabinets they’ll look for other problems in the house and that won’t end well. On the other hand, if your cabinets are in good shape but the finish is outdated, consider hiring a professional painter to get a fresh new coat of paint on them. This will appear as though you’ve completely replaced your cabinets, though your professional paint job will have cost significantly less. 

Appliances are the biggest bang for your buck. Stainless steel appliances are still king and you can find a complete matching set for around $5,000 in most cases. 

Hardwood flooring

 

Hardwood is easily the most sought after flooring type amongst buyers. If you have it in your budget, and the value of homes in your neighborhood can carry that kind of upgrade, this renovation will surely increase the perceived and market value of your home. 

If you already have hardwood flooring, having them refinished will make a huge difference to homebuyers. If you skip this small and very painless renovation, you’ll likely see a deduction in your sales price to reflect the needed repair. 

Repaint

A fresh coat of paint is the easiest and most affordable way to transform your space. A bad paint job is worse than none at all, so I’d recommend hiring a professional painter to do this so that you aren’t creating more work for the new buyer.  

Fixture upgrades

Updating fixtures is by far the easiest and most cost effective way to add value to your home. You can completely transform your home by upgrading plumbing and lighting fixtures, but going even further with new hardware and doorknobs will make a huge difference in the perceived and market value of your home. It goes without saying that when updating fixtures, it’s best to stick to the same finish, (i.e., brushed bronze, polished nickel, or brushed nickel are the most common options). 

Confidence in housing market up says Berkshire Hathaway

Overall confidence in the US housing market continues to gain despite concerns about rising interest rates, especially among younger buyers.

The latest survey of homeowner sentiment from Berkshire Hathaway HomeServices shows most prospective homeowners (62%) are optimistic about the economy and the real estate market (68%); as are most existing homeowners (economy 61%, real estate 70%).

Among existing homeowners, the optimism is driven for almost half by lower interest rates while 43% said it was down to higher home values.

Across all respondents, optimism is increasing due to an uptick on construction with three quarters saying that more availability will help market momentum.

“Optimism in the real estate market and economy are at levels we have not seen since we first began fielding this survey in 2015,” concluded Gino Blefari, president and CEO of Berkshire Hathaway HomeServices. “Mortgage rates remain near historic lows even with recent upticks, and we’re seeing rising wages, job growth and construction rates, which continue to make homeownership a compelling and realistic investment for many Americans.”

The survey shows that 75% of prospective homebuyers and 83% of current owners are more optimistic about construction in urban areas, building homes near to their workplaces.

Will Sudden Credit Boost Really Help Buyers? | Realtor Magazine

The three credit reporting companies are implementing a change Saturday that is expected to raise credit scores for about 6 percent of people with credit profiles, or about 12 million people. Equifax, TransUnion, and Experian will change the way they treat data concerning civil judgments and tax liens on people’s credit reports. These data are among the most likely to be incorrect or incomplete, and people have spent a lot of time and effort trying to get wrong information corrected over the years. In the meantime, their credit scores have suffered.

Because of these problems, attorneys general in several states worked out a settlement with the credit reporting agencies requiring them to leave such data out of people’s credit profiles if it is incomplete. The result could be a boost of about 20 points on average to the credit scores of people affected. But that increase isn’t enough to make a difference for many loan applicants in terms of qualification. For borrowers who are on the cusp of qualifying, however, the raise in credit score can put them over the top. For that reason, it’s worth letting your customers know about the imminent change.

The credit score boost is a top story in the latest Voice for Real Estate news video from the National Association of REALTORS®. The video also covers the latest on flood insurance reauthorization in Congress, an NAR advocacy priority since home sales in 32,000 communities nationwide can’t close without the insurance. The only insurer available for many homeowners is the federal government, so if the program expires, lenders won’t be able to close home loans for borrowers in flood zones.

In a positive development, lawmakers on the House Financial Services Committee have approved a handful of bills to reauthorize and reform the National Flood Insurance Program. However, one of the bills needs more work, according to NAR, because it risks disrupting sales and confusing consumers. The association will try to get it improved before it gets taken up on the House floor. The program’s authorization runs out in a few months.

The video also looks at the latest home sales, NAR’s new CEO, and a case study of a brokerage in the Atlanta area that completely reinvented itself after the economic downturn.

June’s Hot List: The Top 20 Housing Markets | Realtor Magazine

Home prices are escalating as the real estate industry rolls through its busiest season for buying and selling, according to realtor.com®. The median list price for all housing types pushed above $250,000 for the first time ever in May, according to the National Association of REALTORS®, and realtor.com® predicts it will reach $275,000 by the end of June. 

“The housing market has now gone 24 months in a row seeing inventory drop on a yearly basis—the longest streak in over two decades,” says Javier Vivas, manager of economic research at realtor.com®. The site’s research team pinpointed the nation’s largest metro areas with the most buyer activity based on the number of listings clicked on at realtor.com® and where homes are selling the fastest.

Home prices are escalating as the real estate industry rolls through its busiest season for buying and selling, according to realtor.com®. The median list price for all housing types pushed above $250,000 for the first time ever in May, according to the National Association of REALTORS®, and realtor.com® predicts it will reach $275,000 by the end of June. 

“The housing market has now gone 24 months in a row seeing inventory drop on a yearly basis—the longest streak in over two decades,” says Javier Vivas, manager of economic research at realtor.com®. The site’s research team pinpointed the nation’s largest metro areas with the most buyer activity based on the number of listings clicked on at realtor.com® and where homes are selling the fastest.

The top-performing cities this month are:

1. Vallejo, Calif.
2. San Francisco
3. Kennewick, Wash.
4. Sacramento, Calif.
5. Columbus, Ohio
6. Detroit
7. Boston
8. Colorado Springs, Colo.
9. San Jose, Calif.
10. San Diego
11. Dallas
12. Waco, Texas
13. Grand Rapids, Mich.
14. Stockton, Calif.
15. Midland, Texas
16. Fort Wayne, Ind.
17. Santa Rosa, Calif.
18. Denver
19. Yuba City, Calif.
20. Modesto, Calif.

The top-performing cities this month are:

1. Vallejo, Calif.
2. San Francisco
3. Kennewick, Wash.
4. Sacramento, Calif.
5. Columbus, Ohio
6. Detroit
7. Boston
8. Colorado Springs, Colo.
9. San Jose, Calif.
10. San Diego
11. Dallas
12. Waco, Texas
13. Grand Rapids, Mich.
14. Stockton, Calif.
15. Midland, Texas
16. Fort Wayne, Ind.
17. Santa Rosa, Calif.
18. Denver
19. Yuba City, Calif.
20. Modesto, Calif.

Survey: More Buyers Make Offers Sight Unseen | Realtor Magazine

The number of buyers making offers sight unseen—meaning they haven’t physically visited the property—is on the rise, according to a survey of recent home buyers conducted by real estate brokerage Redfin. Thirty-three percent of respondents in 11 major markets say they made an offer on at least one house sight unseen. These types of offers are more common when working with foreign buyers and in markets where homes are selling quickly, real estate professionals say.

New uses of 3-D photos, video tours, and virtual reality are giving some buyers enough confidence to purchase a home without an in-person showing. The Wall Street Journal reports that some real estate pros are conducting property walkthroughs with long-distance buyers remotely via FaceTime, Skype, or WhatsApp. Some agents are working with technology companies to create 3-D photo and video tours within the virtual reality space to make long-distance buyers feel like they’re at the property in person.

Home buyer Angelo Smyrnios of Littleton, Colo., recently purchased a home in Lighthouse Point, Fla., for $1.65 million without ever stepping foot inside. Smyrnios’ agents, Lisa and John Wilson of Douglas Elliman Boca Raton, gave him and his wife a 45-minute tour of the property using FaceTime while walking through the home and highlighting its features. The agents then FaceTimed their clients while riding on a motorbike so they could get a view of the surrounding neighborhood.

Real estate companies are also seeing more homebuying capabilities with virtual reality. About 10 percent of Sotheby’s International Realty’s listings now have 3-D photo tours in which clients can view 3-D property pictures on a screen or while wearing VR headsets. The company expects that in five years, it’ll have viewing areas in every office, says John Passerini, global vice president of interactive marketing.

Tech startup VirtualAPT offers a robot that can film virtual tours in 3-D. The robot can record a real estate professional guiding a tour of the property and then produce a video within 15 minutes. VirtualAPT CEO Bryan Colin says the goal of these tours is to help faraway buyers see the property themselves and get a full tour virtually.