Category: Real Estate

Mortgage Rates Haven’t Been This High in 7 Years | Realtor Magazine

 

Mortgage rates were on the rise again this week, reaching their highest level since 2011. The 30-year fixed-rate mortgage rose six basis points last week to an average of 4.66 percent. 

“Mortgage rates so far in 2018 have had the most sustained increase to start the year in over 40 years,” says Sam Khater, Freddie Mac’s chief economist. “Through May, rates have risen in 15 out of the first 21 weeks (71 percent), which is the highest share since Freddie Mac began tracking this data for a full year in 1972.” 

Khater adds that the higher rates likely are having an impact on the housing market. “At a time when housing inventory remains extremely low, it’s worth watching whether these high borrowing costs lead some would-be sellers to stay put in their current home,” he says. “Inventory shortages would likely worsen if more homeowners decided not to sell out of reluctance of having a new mortgage with a higher rate.” 

Freddie Mac reports the following national averages with mortgage rates for the week ending May 24: 

• 30-year fixed-rate mortgages: averaged 4.66 percent, with an average 0.4 point, rising from last week’s 4.61 percent average. A year ago, 30-year rates averaged 3.95 percent. 
• 15-year fixed-rate mortgages: averaged 4.15 percent, with an average 0.4 point, rising from last week’s 4.08 percent average. A year ago, 15-year rates averaged 3.19 percent. 
• 5-year hybrid adjustable-rate mortgages: averaged 3.87 percent, with an average 0.3 point, climbing from last week’s 3.82 percent average. A year ago, 5-year ARMs averaged 3.07 percent. 

What People Would Sacrifice to Buy a Home | Realtor Magazine

Home buyers are willing to make extreme sacrifices and even give up some basic rights to get a chance at homeownership or help with their down payment, a new survey shows. In exchange for a 10 percent down payment, would-be buyers said they’d forgo their dream car, vacations, and even their right to vote.  Twenty-two percent of 1,000 buyers recently surveyed said they’d be willing to give up the right to vote in exchange for a 10 percent down payment they would not need to pay back, according to Unison Home Ownership Investors and Atomik Research’s The Value of Owning a Home survey. Millennials (26 percent) are more likely than Gen X (20 percent) and baby boomers (7 percent) to be willing to give up their right to vote. Men are more likely than women to give up their driver’s license—14 percent versus 9 percent, respectively. Forty-four percent said they’d be willing to give up their dream car, and 38 percent would give up vacationing for the next five years.  Homeownership status may even affect relationships, the survey found. Fifty-eight percent of respondents said they’d be more likely to date or marry someone who already owned a home at the time their relationship began, according to the survey. Homeowners may be more attractive to aspiring buyers. Millennials (58 percent), Gen X (59 percent), and baby boomers (56 percent) admit preference toward engaging in a relationship with a current homeowner.  To overcome the down payment barrier, more consumers are showing openness toward crowdfunding. Twenty-six percent of respondents surveyed said they’d consider crowdfunding a down payment, and 29 percent would use an equity investment or homeownership investment. Read more about buyers using crowdfunding to secure a home.

Kids Have Big Say in Real Estate Decisions | Realtor Magazine

The opinion of homebuyers’ children has a big sway in real estate decisions, a new survey finds. Fifty-five percent of homeowners surveyed say that their children under the age of 18 have an opinion on which home to buy, according to a new Harris Poll Survey commissioned by SunTrust Mortgage of more than 2,000 adults. 

Seventy-four percent of millennial parents between the ages of 18 and 36 report their children have even more of an influence. And 83 percent of renters said the opinion of their children will be a factor in which home to buy, the survey finds. 

The top requests of children include their own bedrooms (57 percent); a large backyard (34 percent); proximity to parks and activities (25 percent), close to schools (24 percent), close to friends (24 percent), and a swimming pool (21 percent). 

“As a parent of two kids, I know from experience that including children in the homebuying process is not only fun for the whole family but also educational for our home buyers of tomorrow,” says Todd Chamberlain, head of Mortgage Banking at SunTrust.

3 Pros, 3 Cons of Buying New Construction | Realtor Magazine

Many house hunters are under the mistaken impression that new construction is flawless, a perception that may be challenging to wrestle with if your seller’s home is surrounded by brand-new development. In reality, there can be just as many inspection issues with new builds as there are with resale properties. If you’re working with clients who are interested in purchasing new, it’s important to manage their expectations and let them know that no home—no matter what age—is perfect. On the other hand, new homes do have some advantages because they’re not worn. Here are three pros and three cons of new construction.

Pros

1. Less wear and tear. Buyers of new construction can expect fewer imperfections in the product, says Terrylynn Fisher, CRS, GRI, a professional stager and associate broker with Dudum Real Estate Group in Walnut Creek, Calif. Scratched floors and cracks in walls, for example, are more commonplace in resale homes than new ones. Finishes and design flourishes in new homes may also be brighter and more colorful because they are untouched.
2. Built-in technology. While many homeowners have been slow to adopt smart-home technology, developers are jumping on the bandwagon more quickly and incorporating smart features into their projects, says Sce Pike, founder and CEO of Portland, Ore.-based software company IOTAS. Smart door locks and thermostats are among the most popular products developers request, but some are eyeing more comprehensive packages that include smart humidity sensors and the ability to control access to a home remotely, Pike adds.
3. It’s a blank canvas. Buyers may feel more like they are designing a home specifically for them when starting from scratch with a brand-new home, which can be a big psychological motivator in a purchase decision, Fisher says. Though resale buyers, too, have the opportunity to make a home their own, they may not feel complete ownership of its style because they’re either adding to, morphing, or covering up the previous owner’s sense of style, says Christine Rae, founder of the Certified Staging Professionals International Business Training Academy.

Cons

1. Flaws due to building shortcuts. Builders may take shortcuts in the construction process to cut costs, and that can result in blemishes in the home. Fisher says one of her buyers recently bought a new home and discovered about six aesthetic problems that were caused during construction, including an unsightly gap at the top of a shower that made the framing behind the wall visible. “It was like a bad flip that appeared beautiful on the outside,” she says. “You’re going to have a more substantial house in an older home because it’s had owners that have cared for it.”
2. Style over functionality. Builders are hyperfocused on open floor plans, as it’s a top priority for today’s buyers. But that often requires sacrificing storage space, Rae says. To achieve a truly open space, builders often have to decrease the size of closets and other areas of the home designed for storage. That can be problematic for meeting the needs of buyers who envision purchasing a long-term residence.
3. Incomplete curb appeal. Many builders put all of their effort—and investment—into the front of the house so it looks good to potential buyers driving by. But they’ll sometimes leave the backyard unattended to, Fisher says. Many new-home buyers may have to assume all the costs of backyard landscaping, including planting grass or laying sod, as well as planting trees and other shrubbery. This can be a huge expense, too.

13 Simple Steps to Prep Your Home for the Best Summer Ever

Summer will be here before you know it, and you know what that means: Heat, hornets and yard work.

If you’re starting to miss spring already, fear not. Here are some quick projects to make your home and garden more comfortable and cost-effective this summer.

Inside the house

• Service the air conditioning. Nothing can ruin your day like a broken air-conditioning unit on a summer day, so keep it running smoothly by servicing it every spring. Every three months, change the filter, flush out drain lines with a cup of bleach, and ensure that the outdoor unit has room to breathe by keeping vegetation about an arm’s length away.
• Replace smoke detector batteries. You’d be surprised at how much peace of mind you’ll get after knocking out this one little chore. Change all the batteries on the same day and remind yourself to do it again in six months. If your smoke alarms were manufactured 10 or more years ago, replace them entirely.
• Rotate ceiling fan blades. Your ceiling fan may have a switch that changes the direction in which the blades turn. If so, make sure that the blades are spinning counterclockwise and pushing air down, rather than up.
• Clean behind appliances. You’ve been putting it off for far too long. You’re terrified of the horrors that await in the shadows of your kitchen, but it’s time to put on some gloves, arm yourself with disinfectant cleaner and roll out the oven with a brave face.
• Clean dryer vents. If your clothes come out of the dryer damp and musty lately, it’s probably because the vent is clogged with lint — not only wasting energy, but posing a significant fire risk. To do it right the first time, purchase a vent-cleaning kit. Its flexible rod and brush attaches to your drill and will extract a puppy-sized mass of lint in no time.
• Upgrade your thermostat. Replacing your existing thermostat with a ‘smart’ model does more than save you money. They respond to your voice, divert cool air to occupied rooms, can be operated from your phone and might even give you a weather forecast at a glance before work.
• Repot houseplants. Give houseplants fresh potting mix in spring when they’re actively growing. Slip the mass of roots and potting mix out of the pot, gently tease apart the roots, remove rotted pieces and replace it with fresh and fertile potting mix. If the leaves are turning pale from too much direct summer sun, move them to a slightly shadier place.

Out in the yard

• Patch your lawn. If you wait too long to plant new grass seeds or sod, aggressive weeds will happily fill the gaps for you. Luckily, grass will quickly establish if you remove all existing weeds beforehand, amend with topsoil and keep the area irrigated for the first week or two.
• Inspect gutters and downspouts. Fall isn’t the only time to clean out the gutters, especially if you have messy trees nearby. Make sure that the gutters are soundly attached to your roof, seal any gaps with silicone caulk and remove any obstructions at the base of the downspout.
• Inspect sprinklers. If you notice any clogged or broken sprinkler heads, shut off the water and dig a 2-inch diameter hole around the head. Unscrew the head from its riser and replace with a new one. If the head is merely clogged, remove the basket and rinse both it and the head in clean water. Reassemble the head and screw it onto the riser.
• Get your mower up and running. Give your mower, string trimmer and other lawn equipment some TLC before the summer mowing season begins. After removing the spark plug, replace the air filters, change the oil, sharpen blades and give your equipment a good cleaning.
• Remove hornet nests. If you have hornets, yellow jackets and paper wasps around your home, take steps to remove them now before they form a large, aggressive colony. You can play it safe by calling a professional, or spray nests at night when they’re less active. Just be sure to wear protective eyewear, a mask, pants and long sleeves.
• Clean the grill. Prevent flare-ups and cooking fires by giving your grill a good cleaning. Ideally you’d clean after every use, but you can start fresh with a grill brush, nozzle and wet rag. Now is also a good time to stock up on charcoal and make sure your tools are ready for grilling season.

Staged to Sell: View Inside This Rosedale, Md. Home

Have a home you recently staged that you’d like to show off here at Styled Staged & Sold? Submit your staging photos for consideration, along with three to five of your best spruce-up tips. Contact Melissa Dittmann Tracey at mtracey@realtors.org. 

 

Home stager: Cyndi Ryan with Staging Gracefully, Middle River, Md.

About the property: A 3-bedroom, 3-full bath single-family home with a 5-car garage and open floor plan in Rosedale, Md. The property was completely restored by Yanni LLC.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

Cyndi’s staging tips from this property:

1. Clean is serene! A fresh, bright decor brings a feeling of peace and tranquility. Whites and beiges paired with a darker wood is a great way to really extenuate a crisp, clean palette. Keep counters clear. Tuck toasters, can openers, and other handheld appliances away to maintain an open non-cluttered prep area.

2. Art does not have to be store bought pictures and paintings. Be creative. Clocks have so much personality now. Choose one that really demonstrates the style of the house and because of their popularity they are also easy to find for an inexpensive price. Create colorful abstract canvases with acrylic paint. Mount an old piece of driftwood or an old farm tool over a sofa for a dramatic textured focal point.

3. Stage the open house. Your refreshments may be store bought but your presentation shouldn’t show it. Break out those gallon pitchers with the cute spout at the bottom and invest in a few really awesome serving plates and racks. Add fresh cut fruit to your drink cups. You want buyers to feel they just walked into the next home where they will entertain friends. Add a little soft jazz playing in the background or music that is gentle and peaceful.

Photo credit: Cyndi Ryan with Staging Gracefully, Middle River, Md.

4. Unclutter. Declutter. Disclutter. Keep your staging simple. Whether for selling that property or even in your own home, no more clutter. The era of knick knacks and curios full of figurines left us some time ago. Minimize to a few staple pieces atop cabinets and dressers. Bring in fresh flowers (or even realistic artificial) and greenery. Let nature help create a space that is welcoming and spacious.

5. Dress the house for the occasion. Ever gone to a party and found that you were overdressed or under-dressed? Know your audience. Designing decor that is the most trendy, cutting edge in the world of interior design isn’t what will speak to most buyers. Buyers are looking for a relateable atmosphere where they can picture themselves. Design your staging to meet the price of the home and neighborhood it’s in. Also, be sure to invest more in homes that will bring a clientele that is looking for a bit more drama. Don’t be afraid of jewel tones or rich textures. Just know what style speaks to your potential buyers for that home.

Rates Hit Highest Level in 7 Years | Realtor Magazine

 

Mortgage rates reversed course and soared to the highest averages in seven years, Freddie Mac reports. The 30-year fixed-rate mortgage averaged 4.61 percent this week, which matches the highest level since May 19, 2011. 

“Healthy consumer spending and higher commodity prices spooked the bond markets and led to higher mortgage rates over the past week,” says Sam Khater, Freddie Mac’s chief economist. “Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season. While this year’s higher mortgage rates have not caused much of a ripple in the strong demand levels of buying a home seen in most markets, inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.” 

Freddie Mac reports the following national averages with mortgage rates for the week ending May 17:

• 30-year fixed-rate mortgages: averaged 4.61 percent, with an average 0.4 point, rising from last week’s 4.55 percent average. Last year at this time, 30-year rates averaged 4.02 percent. 
• 15-year fixed-rate mortgages: averaged 4.08 percent, with an average 0.4 point, increasing from last week’s 4.01 percent average. A year ago, 15-year rates averaged 3.27 percent. 
• 5-year hybrid adjustable-rate mortgages: averaged 3.82 percent, with an average 0.3 point, rising from last week’s 3.77 percent average. A year ago, 5-year ARMs averaged 3.13 percent. 

Builders Speed Up Townhome Construction | Realtor Magazine

ownhouse construction continues making gains as buyers’ appetites once again increase for this type of single-family attached housing. Over the last four quarters, ending with the first quarter of 2018, townhouse starts were 7 percent higher than the prior four quarters. Townhouses accounted for 21,000 starts during the first quarter of 2018. 

The market share of new townhouses now stands at 12.3 percent of all single-family housing starts, according to an analysis from the National Association of Home Builders. Over the last two decades, the peak market share for townhome construction was reached in the first quarter of 2008, when the share was at 14.6 percent of total single-family construction. 

“I expect future gains in the share as townhouses are a useful bridge from rentership to homeownership for younger prospective home buyers in high-cost markets, among other market opportunities,” Robert Dietz, the NAHB’s chief economist, writes at the builder association’s Eye on Housing blog. “The long-run prospects for townhouse construction are positive given the large numbers of homebuyers looking for medium-density residential neighborhoods, such as urban villages that offer walkable environments and other amenities.”

Best Tip to First-Time Buyers: Act Fast | Realtor Magazine

A shortage of homes for sale and rising home prices are making it challenging for first-time buyers, in particular, this spring. For those who want to land a home, real estate professionals are urging them to move fast.  

The price of an existing home in March was about $250,000, up nearly 6 percent from a year ago, according to the National Association of REALTORS®. Homes are selling faster too, often under contract in about a month. 

“The starter house is nearly missing in some markets,” says Jessica Lautz, NAR’s director of survey research and communication. 

In Colorado Springs, Colo., real estate pro Jay Gupta says the imbalance between the supply of homes and demand is “unprecedented” and many buyers are being priced out of some areas. Homes that are selling for less than $225,000 are hard to find, he says. Gupta told The New York Times a home listed for $310,000 in the area recently attracted 40 people to a three-hour open house. The home was soon under contract with a buyer offering $30,000 above the asking price. 

To increase chances, home buyers should get preapproved for a loan and be ready to act quickly when they find a home they like, Gupta says. They’ll likely need to be less picky too. Pick two or three “must haves” and make those the priority so you can move fast when opportunities arise, Gupta suggests. “You have to be more flexible,” he adds. 

Also, home buyers needn’t wait for a 20 percent down payment. More than half of first-time buyers make down payments of 6 percent or less, according to NAR data from 2017. Both Freddie Mac and Fannie Mae support home loans to eligible buyers who put down as little as 3 percent on a home purchase, as does the FHA. 

Single Women Outbuy Men in Homeownership | Realtor Magazine

Single women are purchasing homes and condos at more than double the rate of single males. The trend is expected to keep growing, too.

Last year, single women comprised 18 percent of all home purchases, while single men accounted for 7 percent, according to the National Association of REALTORS®. Single women are the second largest segment of home purchasers, behind married couples. Single women purchasers include never-married individuals, widows, and divorcees.  

Homebuilders are taking notice and are increasingly designing homes and subdivisions to appeal to women’s preferences. For example, in a development in North Carolina with McKee Homes, up to 50 percent of the homes purchased are by single women in their 30s, 40s, or older.

Read more: 6 Must-Haves for Women in Home Shopping

Single women tend to view homeownership more as an investment, Jessica Lautz, NAR’s director of demographic and behavioral insights, told The Washington Post. Single women tend to pay more on their home purchase than single men—$185,000 compared to $175,000. 

Rising rents may be the motivator that’s pushing more single women to homeownership. Twenty-three percent of single women cited rising rents as a “trigger” motivator behind their home purchase, according to a survey conducted by the Builders Digital Experience, a research and publishing firm. That is a greater percentage than the 16 percent average of all recent buyers surveyed.