Tag: home buying

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Real Estate Market

Key Factors That Impact Affordability Today

Key Factors That Impact Affordability Today

You can’t read an article about residential real estate without the author mentioning the affordability challenges that today’s buyers face. There’s no doubt homes are less affordable today than they were over the last two years, but that doesn’t mean homes are now unaffordable.

There are three measures used to establish home affordability: home prices, mortgage rates, and wages. Let’s look closely at each of these components.

1. Home Prices

The most recent Home Price Insights report by CoreLogic shows home values have increased by 19.1% from last January to this January. That was one reason affordability declined over the past year.

2. Mortgage Rates

While the current global uncertainty makes it difficult to project mortgage rates, we do know current rates are almost one full percentage point higher than they were last year. According to Freddie Mac, the average monthly rate for last February was 2.81%. This February it was 3.76%. That increase in the mortgage rate also contributes to homes being less affordable than they were last year.

3. Wages

The one big, positive component in the affordability equation is an increase in American wages. In a recent article by RealtyTrac, Peter Miller addresses that point:

“Prices are up, but what about wages? ADP reports that job holder incomes increased 5.9% last year but rose 8.0% for those who switched employers. In effect, some of the higher cost to buy a home has been offset by more cash income.”

The National Association of Realtors (NAR) also recently released information that looks at income and affordability. The NAR data provides a comparison of the current median family income versus the qualifying income for a median-priced home in each region of the country. Here’s a graph of their findings:

Buyer Income Still Greater Than Required

As the graph shows, the median family income (shown in blue on the graph) is greater than the qualifying income needed to buy a median-priced home (shown in green on the graph) in all four regions of the country. While those figures may vary in certain locations within each region, it’s important to note that, in most of the country, homes are still affordable.

So, when you think about affordability, remember that the picture includes more than just home prices and mortgage rates. When prices rise and rates rise, it does impact affordability, and experts project both of those things will climb in the months ahead. That’s why it’s less affordable to buy a home than it was over the past two years when prices and rates were lower than they are today. But wages need to be factored into affordability as well. Because wages have been rising, they’re a big reason that, while less affordable, homes are not unaffordable today.

Bottom Line

To find out more about affordability in our local area, let’s discuss where home prices are locally, what’s happening with mortgage rates, and get you in contact with a lender so you can make an informed financial decision. Remember, while less affordable, homes are not unaffordable, which still gives you an opportunity to buy today.

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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The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

How Global Uncertainty Is Impacting Mortgage Rates

How Global Uncertainty Is Impacting Mortgage Rates

If you’re thinking about buying or selling a home, you’ll want to keep a pulse on what’s happening with mortgage rates. Rates have been climbing in recent months, especially since January of this year. And just a few weeks ago, the 30-year fixed mortgage rate from Freddie Mac approached 4% for the first time since May of 2019. But that climb has dropped slightly over the past few weeks (see graph below):

Graph
Mortgage Rates

The recent decline in mortgage rates is primarily due to growing uncertainty around geopolitical tensions surrounding Russia and Ukraine. But experts say it’s to be expected.

Here’s a look at how industry leaders are explaining the impact global uncertainty has on mortgage rates:

Odeta Kushi, Deputy Chief Economist at First American, says:

“While mortgage rates trended upward in 2022, one unintended side effect of global uncertainty is that it often results in downward pressure on mortgage rates.”

In another interview, Kushi adds:

“Geopolitical events play an important role in impacting the long end of the yield curve and mortgage rates. For example, in the weeks following the ‘Brexit’ vote in 2016, the U.S. Treasury bond yield declined and led to a corresponding decline in mortgage rates.”

Kushi’s insights are a reminder that, historically, economic uncertainty can impact the 10-year treasury yield – which has a long-standing relationship with mortgage rates and is often considered a leading indicator of where rates are headed. Basically, events overseas can have an impact on mortgage rates here, and that’s what we’re seeing today.

Will Mortgage Rates Stay Down?

While no one has a crystal ball to predict exactly what will happen with rates in the future, experts agree this slight decline is temporary. Sam Khater, Chief Economist at Freddie Mac, echoes Kushi’s sentiment, but adds that the decline in rates won’t last:

“Geopolitical tensions caused U.S. Treasury yields to recede this week . . . leading to a drop in mortgage rates. While inflationary pressures remain, the cascading impacts of the war in Ukraine have created market uncertainty. Consequently, rates are expected to stay low in the short-term but will likely increase in the coming months.” 

Rates will likely fluctuate in the short-term based on what’s happening globally. But before long, experts project rates will renew their climb. If you’re in the market to buy a home, doing so before rates start to rise again may be your most affordable option.

Bottom Line

Mortgage rates are an important piece of the puzzle because they help determine how much you’ll owe on your monthly mortgage payment in your next home. Let’s connect so you have up-to-date information on rates and trusted advice on how to time your next move.

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

Let’s Connect:
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The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

Supply and Demand in Today’s Market [Infographic]

Infographic
Supply and Demand in Today’s Market [INFOGRAPHIC]

Some Highlights

  • Today’s housing market is the direct result of low supply and high buyer demand. Here’s what that means for you and your plans to buy or sell.
  • For buyers, expect competition, be ready to move fast, and be prepared to submit your strongest offer. For sellers, know your house will be the center of attention and that it’ll likely sell quickly and get multiple offers.
  • If you’re ready to move, let’s connect to talk about our local area and how you can take advantage of today’s unprecedented housing 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

Let’s Connect:
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Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

Are Home Prices Continuing To Rise?

Are Home Prices Continuing To Rise?

Many analysts projected home price appreciation would slow dramatically in the fall of 2021 and then continue to soften throughout 2022. So far, that hasn’t happened. The major price indices are all revealing ongoing double-digit price appreciation. Here’s a look at their reports on year-over-year price appreciation for December:

To show that they’re not seeing signs of softening, here’s a graph that gives the progression of all three indices for each month of 2021.

Graph
Price Acceleration Levels Off, but Doesn’t Fall

As the graph above reveals, last year, home price appreciation accelerated dramatically from January to July according to all three indices. Then, it began to decelerate in August when prices appreciated at a slower pace, but it didn’t decline. Many thought that would be the beginning of a rapid slowdown in the level of home price appreciation, but as the data shows, that wasn’t the case. Instead, prices began to level off for a few months before two of the three indices saw appreciation re-accelerate again in December.

To clarify, deceleration is not the same as depreciation. Acceleration means prices rise at a greater year-over-year pace than the previous month. Deceleration means home values continue to rise but at a slower pace of year-over-year appreciation. Depreciation means prices drop below current values. No one is forecasting that to happen.

In fact, the FHFA revealed that price appreciation accelerated in December in six of the nine regions it tracks. Case Shillershowed that appreciation accelerated in 15 of the 20 metros they report on. As Selma Hepp, Deputy Chief Economist at CoreLogic, explains:

“After some signs of slowing home price growth . . . monthly price growth re-accelerated again, indicating home buyers have not yet thrown in the towel.”

What Does This Mean for You?

Whether you’re a first-time purchaser or someone looking to sell your current house and buy a home that better fits your needs, waiting to decide what to do will cost you in two ways:

  1. Mortgage rates are forecast to rise this year.
  2. Home prices should continue to appreciate at double-digit levels for some time.

If you wait, rising mortgage rates and high home price appreciation will have a dramatic impact on your monthly mortgage payment.

Bottom Line

Maybe the best thing to do is listen to the advice of Len Kiefer, Deputy Chief Economist at Freddie Mac:

“If you’re thinking about waiting until next year and that maybe rates are higher, but you’ll get a deal on prices – well that’s risky. It may be more advantageous to purchase this year relative to waiting until 2023 at this time.”

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Buying a House

Down Payment Assistance Programs Can Help You Achieve Homeownership

Down Payment Assistance Programs Can Help You Achieve Homeownership

For many homebuyers, the thought of saving for a down payment can feel daunting, especially in today’s market. That’s why, when asked what they find most difficult in the homebuying process, some buyers say it’s one of the hardest steps on the path to homeownership. Data from the National Association of Realtors (NAR) shows:

“For first-time home buyers, 29 percent said saving for a downpayment [sic] was the most difficult step in the process.”

If you’re finding that your down payment is your biggest hurdle, the good news is there are many down payment assistance programs available that can help you achieve your goals. The key is understanding where to look and learning what options are available. Here’s some information that can help.

First-Time and Repeat Buyers Are Often Eligible

According to downpaymentresource.com, there are thousands of financial assistance programs available for homebuyers, like affordable mortgage options for first-time buyers. But, of the many programs that are available, down payment assistance options make up the large majority. They say 73% of the assistance available to homebuyers is there to help you with your down payment.

And it’s not just first-time homebuyers that are eligible for these programs. Downpaymentresource.com notes:

“You don’t have to be a first-time buyer. Over 38% of all programs are for repeat homebuyers who have owned a home in the last 3 years.”

That means no matter where you are in your homeownership journey, there could be an option available for you.

There Are Local Programs and Specialized Programs for Public Servants

There are also multiple down payment assistance resources designed to help those who serve our communities. Teacher Next Door is one of those programs:

“The Teacher Next Door Program was designed to increase home ownership among teachers and other public servants, support community development and increase access to affordable housing free from discrimination.”

Teacher Next Door is just one program that seeks to help teachers, first responders, health providers, government employees, active-duty military personnel, and veterans reach their down payment goals.

And, most importantly, even if you don’t qualify for these types of specialized programs, there are many federal, state, and local programs available for you to explore. And the best way to do that is to connect with a local real estate professional to learn more about what’s available in your area.

Bottom Line

If saving for a down payment seems daunting, there are programs available that can help. And if you work to serve our community, there may be even more opportunities available to you. To learn more about your options, let’s connect so you can start your homebuying journey today.

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Buying a House

Millennials: Do You Need a Home with More Space?

Millennials: Do You Need a Home with More Space?

If you’re a millennial, homebuying might be top of mind for you. Your generation is the largest group of homebuyers in the market today and has been since 2014, according to the National Association of Realtors (NAR). And while other millennials are looking to buy for the first time, you may be one of the many who are now discovering you’ve outgrown your home.

If that’s the case, you’re not alone. The past two years brought about significant changes for many people, and today, homeowners are reevaluating what they truly need in a home. As a recent report from the Wall Street Journal states:

“They say the pandemic and the emergence of remote work accelerated millennial home-buying trends already under way. . . . Millennials who already owned homes traded up for more space.”

So, if you’re working remotely now or simply have a growing need for additional space, it may be time to move. And even if you purchased your current home sometime over the last few years, you can still move into a different one that has the space and features you’re looking for. That’s because there’s a good chance you have more equity than you realize. As Diana Olick, Real Estate Correspondent for CNBC, notes:

“The stunning jump in home values over the course of the Covid-19 pandemic has given U.S. homeowners record amounts of housing wealth. . . . Even homeowners who weren’t listing their properties for sale were gaining equity. About 42% of homeowners were considered equity-rich at the end of last year, meaning their mortgages were half or less than half the value of their home.”

Growing equity can be the key you need to fuel your next move, especially if you’re looking to purchase a larger home. When you sell your current house, the equity that comes back to you in the sale can be used toward the down paymenton your next home.

In other words, your purchasing power may be greater than you realize, making a move to a larger home a realistic option. That, plus your changing needs, might make moving now more desirable than ever.

Bottom Line

If you’re a millennial thinking about moving this year, you’re not alone. Let’s connect today to discuss the equity you have in your current home and the opportunities it can create.

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Buying a House

The Difference Between Renting and Owning [INFOGRAPHIC]

Infographic
The Difference Between Renting and Owning [INFOGRAPHIC]

Some Highlights

  • If you’re deciding whether to rent or buy, consider the many financial benefits that come with owning a home.
  • As a renter, you build your landlord’s wealth and face rising costs. As a homeowner, you build your own net worthand can lock in your monthly payments for the length of your loan.
  • If you’re weighing your options, remember that owning a home is a decision that has considerable financial perks. If you want to learn more, let’s connect to talk about the perks of homeownership.

 

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

How Supply and Demand Can Impact Your Buying and Selling Goals

How Supply and Demand Can Impact Your Buying and Selling Goals

In today’s housing market, there are far more buyers looking for homes than sellers listing their houses. Based on the concept of supply and demand, this means home prices will naturally rise. Why is that? When there are more people trying to buy an item than there are making that item available for sale, that drives prices up. And that’s exactly the case in today’s housing market. So, knowing what’s happening with the inventory of homes for sale and the demand for housing is crucial for today’s buyers and sellers.

Nationally, Demand Is High and Supply Is Very Low

The latest buyer and seller activity data from the National Association of Realtors (NAR) indicates buyer traffic heavily outweighs seller traffic today, as shown in the maps below. There are far darker blues (strong buyer activity) on the left and much lighter blues (weak seller activity) on the right. In other words, this shows how the demand for homes is significantly greater than what’s available to purchase.

Buyer and Seller Activity Data

What Does This Mean if You’re a Seller?

Supply is struggling to keep pace with demand. In fact, the inventory of homes for sale recently hit an all-time low. That gives you an incredible advantage when you sell your house. With so few listings, it’s likely more potential buyers will view your house – especially if you work with an agent to price it right. That means there’s a high chance you’ll receive multiple offers or buyers will enter a bidding war for your house. And that dynamic can drive the sale price of your home up.

What Does This Mean if You’re a Buyer?

As a buyer with fewer options available, you’re likely to see more competition, so you need to be strategic to win. First, make sure you have a trusted professional on your side. Your real estate agent will help you understand your local market and work with you to act quickly when the time is right. Even when it’s challenging to find a home, you can still succeed as a buyer today if you have a trusted advisor on your side every step of the way.

Bottom Line

Whether you’re a homebuyer, seller, or both, knowledge truly is power. Let’s connect today so you can better understand what’s happening in our local market and achieve your homebuying and selling goals this year.

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

The Perks of Owning More Than One Home

The Perks of Owning More Than One Home

Many things have changed over the past couple of years, and real estate is no exception. One impact is an increased desire to own more than one home. According to the recent Luxury Market Report from Luxury Home Marketing:

“As trends such as remote working and flexi-hours took hold in 2021, so too did the flexibility of relocating as well as the growth of second homeownership.”

This may be because the pandemic has altered how we think about our homes. Where we live has become, more than ever, our safe space and our getaway. And with the rise in remote work, more people are reconsidering where they want to live and buying second homes to give them greater flexibility. If you fall in that category, here are just a few of the perks you’ll enjoy, and how owning a second home may be a great decision for your lifestyle and your future.

Enjoy a Change in Scenery (or Weather)

When you have two homes, you can alternate between them as the weather changes or as you crave different scenery. Do you want to live in an area with a particular season? Would alternating between a resort and a suburban setting be ideal? With two homes, you have those options. Being able to move between homes based on which location best suits you at the time gives you added flexibility and variety that can help increase your happiness.

Build Your Wealth Faster

You may have heard that home equity is skyrocketing, thanks to ongoing home price appreciation. CoreLogic reportsthat the average homeowner gained $56,700 in equity over the last year. With home prices projected to continue rising, if you purchase a second home, you could benefit from rising equity on both properties to build your wealth (and your net worth) even faster.

Be Closer to Loved Ones

The pandemic has also reignited the importance of being near our loved ones. One option worth exploring is whether you want your second home to be near the people who matter most in your life. This makes it easier to see your loved ones but still gives you your own dedicated, private space so you can be nearby for major life events or longer visits.

Lock in Your Expenses

Buying a second home today and locking in your mortgage rate may be a good option if you’re looking to stabilize your housing costs for the long haul. If you’re approaching retirement or are looking to use your second home as your permanent residence in the future, buying that house now with today’s rate and price may be a good financial decision. That way, no matter what happens with rates and prices in years ahead, your monthly payment is locked in for the next 15-30 years.

Bottom Line

Having multiple homes has considerable benefits. If owning a second home is something you’re interested in, let’s connect to explore your options, discuss the benefits, and take the next step to start your home search.

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

 

Categories
Real Estate Market

Real Estate Voted the Best Investment Eight Years in a Row

Real Estate Voted the Best Investment Eight Years in a Row

In an annual Gallup poll, Americans chose real estate as the best long-term investment. And it’s not the first time it’s topped the list, either. Real estate has been on a winning streak for the past eight years, consistently gaining traction as the best long-term investment (see graph below):

Real Estate is Seen as a Better Investment Than Stocks, Gold, and Savings for 8 Years

If you’re thinking about purchasing a home this year, this poll should reassure you. Even when inflation is rising like it is today, Americans agree an investment like real estate truly shines.

Why Is Real Estate a Great Investment During Times of High Inflation?

With inflation reaching its highest level in 40 years, it’s more important than ever to understand the financial benefits of homeownership. Rising inflation means prices are increasing across the board. That includes goods, services, housing costs, and more. But when you purchase your home, you lock in your monthly housing payments, effectively shielding yourself from increasing housing payments. James Royal, Senior Wealth Management Reporter at Bankrate, explains it like this:

“A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same.”

If you’re a renter, you don’t have that same benefit, and you aren’t protected from increases in your housing costs, especially rising rents.

History Shows During Inflationary Periods, Home Prices Rise as Well

As a homeowner, your house is an asset that typically increases in value over time, even during inflation. That‘s because, as prices rise, the value of your home does, too. And that makes buying a home a great hedge during periods of high inflation. Natalie Campisi, Advisor Staff for Forbes, notes:

“Tangible assets like real estate get more valuable over time, which makes buying a home a good way to spend your money during inflationary times.”

Bottom Line

Housing truly is a strong investment, especially when inflation is high. When you lock in a mortgage payment, you’re shielded from housing cost increases, and you own an asset that typically gains value with time. If you want to better understand how buying a home could be a great investment for you, let’s connect today.

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

Let’s Connect:
Facebook
Linkedin
Twitter
Instagram

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. The author does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. The author will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.