Month: October 2019

Categories
Buying a House

Taking the Fear Out of the Mortgage Process

“Dark, spooky woods in the night with one solitary flashlight light. Purposefully dark for spooky, mysterious effect. Related:”

A considerable number of potential buyers shy away from the real estate market because they’re uncertain about the buying process – particularly when it comes to qualifying for a mortgage.

For many, the mortgage process can be scary, but it doesn’t have to be!

In order to qualify in today’s market, you’ll need a down payment (the average down payment on all loans last year was 5%, with many buyers putting down 3% or less), a stable income, and a good credit history.

Once you’re ready to apply, here are 5 easy steps Freddie Mac suggests to follow:

  1. Find out your current credit history and credit score– Even if you don’t have perfect credit, you may already qualify for a loan. The average FICO Score® for all closed loans in September was 737, according to Ellie Mae.
  2. Start gathering all of your documentation– This includes income verification (such as W-2 forms or tax returns), credit history, and assets (such as bank statements to verify your savings).
  3. Contact a professional– Your real estate agent will be able to recommend a loan officer who can help you develop a spending plan, as well as help you determine how much home you can afford.
  4. Consult with your lender– He or she will review your income, expenses, and financial goals in order to determine the type and amount of mortgage you qualify for.
  5. Talk to your lender about pre-approval– A pre-approval letter provides an estimate of what you might be able to borrow (provided your financial status doesn’t change) and demonstrates to home sellers that you’re serious about buying.

Bottom Line

Do your research, reach out to professionals, stick to your budget, and be sure you’re ready to take on the financial responsibilities of becoming a homeowner.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

How to Determine If You Can Afford to Buy a Home

Saving to buy a house or home savings concept with money coin stack growing.Saving money concept.

The gap between the increase in personal income and residential real estate prices has been used to defend the concept that we are experiencing an affordability crisis in housing today.

It is true that home prices and wages are two key elements in any affordability equation. There is, however, an extremely important third component to that equation: mortgage interest rates.

Mortgage interest rates have fallen by more than a full percentage point from this time last year. Today’s rate is 3.75%; it was 4.86% at this time last year. This has dramatically increased a purchaser’s ability to afford a home.

Here are three reports validating that purchasing a home is in fact more affordable today than it was a year ago:

CoreLogic’s Typical Mortgage Payment

“Falling mortgage rates and slower home-price growth mean that many buyers this year are committing to lower mortgage payments than they would have faced for the same home last year. After rising at a double-digit annual pace in 2018, the principal-and-interest payment on the nation’s median-priced home – what we call the “typical mortgage payment”– fell year-over-year again.”  

The National Association of Realtors’ Affordability Index

“At the national level, housing affordability is up from last month and up from a year ago…All four regions saw an increase in affordability from a year ago…Payment as a percentage of income was down from a year ago.”

First American’s Real House Price Index (RHPI)

“In 2019, the dynamic duo of lower mortgage rates and rising incomes overcame the negative impact of rising house price appreciation on affordability. Indeed, affordability reached its highest point since January 2018. Focusing on nominal house price changes alone as an indication of changing affordability, or even the relationship between nominal house price growth and income growth, overlooks what matters more to potential buyers – surging house-buying power driven by the dynamic duo of mortgage rates and income growth. And, we all know from experience, you buy what you can afford to pay per month.”

Bottom Line

Though the price of homes may still be rising, the cost of purchasing a home is actually falling. If you’re thinking of buying your first home or moving up to your dream home, let’s connect so you can better understand the difference between the two.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Selling a House Fast

Thinking of Selling Your Home? The Waiting Is The Hardest Part.

Tom Petty famously penned the words, “the waiting is the hardest part” in his early 80’s hit song The Waiting, and his thought process can surprisingly also be applied to individuals considering selling their homes today. Traditional thinking would suggest it may be best to wait until the spring to sell when there is a flood of buyers in the market, but right now may in fact be an even better time to list your home.

We can see the overall economy is good: wages are rising, there are near record-low unemployment rates, and mortgage interest rates are still very low too. Over the past 10+ years the housing market has stabilized, so what (if anything) is the biggest challenge in the housing market today?

The answer is simple: it’s inventory.

According to the Existing Home Sales Report by the National Association of Realtors,

“Total housing inventory at the end of September sat at 1.83 million, approximately equal to the amount of existing-homes available for sale in August, but a 2.7% decrease from 1.88 million one year ago. Unsold inventory is at a 4.1-month supply at the current sales pace, up from 4.0 months in August and down from the 4.4-month figure recorded in September 2018.”

What does this mean?

While homes are coming to the market, they aren’t coming fast enough! Right now, across the country there is less than 6 months of overall inventory of homes for sale, putting us in a seller’s market. The challenge is that there are not enough homes for sale to increase the supply needed for the number of people who want to buy, especially in the starter and middle-level markets.

Thinking of Selling Your Home? The Waiting Is The Hardest Part. | MyKCM

To be in a balanced market (meaning we have enough inventory for the number of buyers in the market), we need to have 6 months of inventory available. Today we are nowhere near that number, and as a matter of fact, the last time we reached that height was August 2012 (as shown in the graph below):When we look at the inventory challenge today, we can see that now is a great time to sell your house. Truthfully, waiting may end up being the hardest part in the long run. This landscape is a great place for sellers who own homes in the starter and middle-level markets to take the opportunity to sell in a sellers’ market, before inventory catches up with demand. Serious buyers are actively in the market and ready to make a move at this time of year. When inventory is limited at the lower end, like it is today, selling before more homes are listed could mean a significant seller’s advantage to those who are ready to move up. The upper level of the market has much more inventory available to move into, so it’s a win across the board.

Bottom  Line

If you’re considering selling your home, don’t wait – now is the time to make your move! Take advantage of the high housing demand and the low inventory of homes for sale at the lower end of the market and use your purchasing power while mortgage rates are low to go after the move-up home of your dreams. Let’s get together to decide if now is the right time for you.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

4 Reasons to Buy a Home This Fall

Fall foliage in Boston’s Brighton Neighborhood. Brighton is a dissolved municipality and current neighborhood of Boston, Massachusetts, United States, and is located in the northwestern corner of the city

Here are four great reasons to consider buying a home today, instead of waiting.

1. Prices Will Continue to Rise

CoreLogic’s latest Home Price Insights Report shows that home prices have appreciated by 3.6% over the last 12 months. The same report predicts prices will continue to increase at a rate of 5.8% over the next year.

The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.

2. Mortgage Interest Rates Are Projected to Increase Next Year

The Primary Mortgage Market Survey from Freddie Mac indicates that interest rates for a 30-year mortgage have recently hovered just above 3.5%. This is great news for buyers in the market right now, because low interest rates increase your purchasing power – but don’t wait! Most experts predict rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac, and the National Association of Realtors are in unison, projecting that rates will increase by this time next year.

An increase in rates will impact your monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is needed to buy your next home.

3. Either Way, You Are Paying a Mortgage 

There are some renters who haven’t purchased a home yet because they’re uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you’re living rent-free with your parents, you are paying a mortgage – either yours or that of your landlord.

As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to have equity in your home you can tap into later in life. As a renter, you guarantee your landlord is the person with that equity.

Are you ready to put your housing costs to work for you?

4. It’s Time to Move on With Your Life

The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears both are on the rise.

But what if they weren’t? Would you wait?

Look at the actual reason you’re buying and decide if it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer, or you just want to have control over custom renovations, maybe now is the time to buy.

Bottom Line

Buying a home sooner rather than later could lead to substantial savings. Let’s get together to determine if homeownership is the right choice for you and your family this fall.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

Don’t Get Spooked by the Real Estate Market!

Having an agent to help guide you is key in today’s complex housing market. Let’s connect so you don’t get spooked by the buying or selling process!

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

Buying a home can be SCARY…Until you know the FACTS

Some Highlights:

Many potential homebuyers believe they need a 20% down payment and a 780 FICO® score to qualify to buy a home. This stops many people from even trying to jump into homeownership! Here are some facts to help take the fear out of the process:

  • 71% of buyers who purchased homes have put down less than 20%.
  • 78.1% of loan applications were approved last month.
  • In September, the average credit score for approved loans was 737.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

Think Prices Have Skyrocketed? Look at Rents.

Woman going through bills at home

Much has been written about how residential real estate values have increased since the housing market started its recovery in 2012. However, little has been shared about what has taken place with residential rental prices. Let’s shed a little light on this subject.

In the most recent Apartment Rent Report, RentCafe explains how rents have continued to increase over the last twelve months because of a large demand and a limited supply.

 “Continued interest in rental apartments and slowing construction keeps the national average rent on a strong upward trend.”

Zillow, in its latest Rent Index, agreed that rents are continuing on an “upward trend” across most of the country, and that the trend is accelerating:

“The median U.S. rent grew 2% year-over-year, to $1,595 per month. National rent growth is faster than a year ago, and while 46 of the 50 largest markets are showing deceleration in annual home value growth, annual rent growth is accelerating in 41 of the largest 50 markets.”

The Zillow report went on to detail rent increases since the beginning of the housing market recovery in 2012. Here is a graph showing the increases:

Bottom Line

It is true that home prices have risen over the past seven years, increasing the cost of owning a home. However, the cost of renting a home has also increased over that same time period.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

5 Reasons to Consider Living in a Multigenerational Home

Did you know that 1 in 6 Americans currently live in a multigenerational household?

According to Generations United, the number of multigenerational households rose from 42.4 million in 2000 to 64 million in 2016. The 2018 Profile of Home Buyers and Sellers from the National Association of Realtors shows that 12% of all buyers have a multigenerational household.

Why Are Many Americans Choosing to Live in a Multigenerational Household?

The benefits to multigenerational living are significant. According to Toll Brothers,

“In recent years, there’s been a steady rise in the number of multigenerational homes in America. Homeowners and their families are discovering new ways to get the most out of home with choices that fit the many facets of their lives.”

The piece continues to explain the top 5 benefits of multigenerational living. Here is the list, and a small excerpt from their article:

1. Shared Expenses

“…Maintaining two households is undeniably costlier and more rigorous than sharing the responsibilities of one. By bringing family members and resources together under one roof, families can collectively address their expenses and allocate finances accordingly.”

2. Shared Responsibilities

“Distributing chores and age-appropriate responsibilities amongst family members is a tremendous way of ensuring that everyone does their part. For younger, more able-bodied members, physical work such as mowing the lawn or moving furniture is a nice trade-off so that the older generation can focus on less physically demanding tasks.”

3. Strengthened Family Bond

“While most families come together on special occasions, multigenerational families have the luxury of seeing each other every day. By living under one roof, these families develop a high level of attachment and closeness.”

4. Ensured Family Safety

“With multiple generations under one roof, a home is rarely ever left unoccupied for long, and living with other family members increases the chances that someone is present to assist elderly family members should they have an accident.”

5. Privacy

“One of the primary trepidations families face when shifting their lifestyle is the fear of losing privacy. With so many heads under one roof, it can feel like there’s no place to turn for solitude. Yet, these floor plans are designed to ensure that every family member can have quiet time… [and] allow for complete separation between the generations within the household.”

Bottom Line

The trend of multigenerational living is growing, and the benefits to families who choose this option are significant. If you’re considering a multigenerational home, let’s get together to discuss the options available in our area.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

Depending on the Price, You’re Going to Need Advice

Sunset in the fall over the suburban neighborhood

To understand today’s complex real estate market, it is critical to have a local, trusted advisor on your side – for more reasons than you may think.

In real estate today, there are essentially three different price points in the market: the starter-home market, the middle-home market, and the premium or luxury market. Each one is unique, and depending on the city, the price point in these categories will vary. For example, a starter or lower-end home in San Francisco, California is much more expensive than almost any other part of the country. Let’s explore what you need to know about each of these tiers.

Starter-Home Market: This market varies by price, and these homes are typically purchased by first-time home buyers or investors looking to flip them for a profit. Across the country, homes in this space currently have less than 6 months of inventory for sale. That means there aren’t enough homes on the lower end of the market for the number of people who want to buy them. A low supply like this generally increases competition, drives bidding wars, and sets up an environment where homes sell above the listing price. According to data from the National Association of Realtors (NAR) on realtor.com,

“The desire for affordability continues to push down the inventory for homes listed for less than $200,000.00.”

Middle-Home Market: This segment is often thought of as the move-up market. Typically, the buyer in this market is moving up to a larger, more custom home with more features, all coming at a higher price. Across the country, this market is looking more balanced than the lower end of the market, meaning it has closer to a 6-month supply of inventory for sale. This market is more neutral, but leaning towards a seller’s market.

Premium & Luxury Home Market: This is the top end of the market with larger homes that have even more custom features and upgrades. Nationwide, this market is growing in the number of homes for sale. In the same realtor.com article, we can see that year-over-year inventory of homes in this tier has grown by 4.7%. Today, there are more homes available in the premium and luxury space, leading to more of a buyer’s market at this end.

Bottom Line

Depending on the segment of the market and the price point you’re looking at, you’re going to need the advice of a true local market expert. Let’s get together to help you navigate the home-buying or selling process in your market.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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Buying a House

5 Tips for Starting Your Home Search

Woman searching for houses

In today’s market, low inventory dominates the conversation in many areas of the country. It can often be frustrating to be a first-time homebuyer if you aren’t prepared. Here are five tips from realtor.com’s article, “How to Find Your Dream Home—Without Losing Your Mind.”

1. Get Pre-Approved for a Mortgage Before You Start Your Search

One way to show you’re serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage. Even if you’re in a market that is not as competitive, understanding your budget will give you the confidence of knowing whether or not your dream home is within your reach. This will help you avoid the disappointment of falling in love with a home well outside your price range.

2. Know the Difference Between Your ‘Must-Haves’ and ‘Would-Like-To-Haves’

Do you really need that farmhouse sink in the kitchen to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Before you start your search, list all the features of a home you would like. Qualify them as ‘must-haves’, ‘should-haves’, or ‘absolute-wish list’ items. This will help you stay focused on what’s most important.

3. Research and Choose a Neighborhood Where You Want to Live

Every neighborhood has unique charm. Before you commit to a home based solely on the house itself, take a test-drive of the area. Make sure it meets your needs for “amenities, commute, school district, etc. and then spend a weekend exploring before you commit.”

4. Pick a House Style You Love and Stick to It

Evaluate your family’s needs and settle on a style of home that will best serve those needs. Just because you’ve narrowed your search to a zip code doesn’t mean you need to tour every listing in that vicinity. An example from the article says, “if you have several younger kids and don’t want your bedroom on a different level, steer clear of Cape Cod–style homes, which typically feature two or more bedrooms on the upper level and the master on the main.”

5. Document Your Home Visits

Once you start touring homes, the features of each individual home will start to blur together. The article suggests keeping your camera handy and making notes on the listing sheet to document what you love and don’t love about each property you visit.

Bottom Line

In a high-paced, competitive environment, any advantage you can give yourself will help you on your path to buying your dream home.

Contact us:
PHP Houses
142 W Lakeview Ave
Unit 1030
Lake Mary, FL 32746
Ph: (407) 519-0719
Fax: (407) 205-1951
email: info@phphouses.com

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