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5 Reasons why NOW is absolutely the time to buy

May 14, 2013 By Leave a Comment
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Real estate is a cyclical business. Whether it’s shifting from a buyers to a sellers market; a sellers to a buyers market or even from the Summer months to the Winter ones – the national and local real estate landscape is ever-changing. Even just this year we watched the real estate landscape fall and then rise rapidly here in Arizona.

Since then, the media has focused on the doom and gloom of a few housing statistics that only represent a portion of the picture. As an expert real estate agent in your local market, I’m happy to tell you that, for the right individual, owning a home is still one of the best investments you can make in your lifetime.

And now could not be a better time to buy. Lawrence Yun, Chief Economist of The National Association of REALTORS could not agree more. Not too long ago, he said “Home buyers over the past year got a great deal, and buyers for the balance of this year have an edge over sellers. Affordability could reach a generational high this year because of rock-bottom mortgage interest rates, helped partly by the Fed’s very accommodating monetary policy.” If you’re waiting to buy I home, I urge you to take a minute to consider the following benefits of buying now – there may not ever be a better opportunity than the one we presently face to purchase a home:

1. Affordability
Housing affordability is at a generational high and has been steadily stabilizing since the boom years of 2006. Affordability, as measured by the median mortgage payment as a percentage of median household income, continues on a downward trend – meaning home ownership is within reach for more Americans.

2. All-time low mortgage rates
Rates are reaching generational lows due to monetary policy and won’t stay there for long. If you take into consideration the decrease in home prices, you have good credit, and you can put money down on the home, buying now, instead of later, is a good option.

3. There are lots of deals
Recently, the National Association of REALTORS put total inventory at 4 million homes. Of those homes, nearly 40 percent are estimated to be foreclosures. These aren’t your run-down foreclosed upon homes, either. Unfortunately, many homeowners fell underwater on their mortgage due to the decline in the economy. As a buyer, you’re able to help them get out from under a home they can’t afford and into a home for a great price.

4. In some cases, Sellers are ready to negotiate
When supply exceeds demand – obviously the buyer has the upper hand. However, right now in the Phoenix metropolitan area, that is not the case. So buyers have to be “hunters” and look for other signs of seller’s willing to negotiate such as a seller needing to move quickly due to a job relocation, or because they can no longer afford their home, they’ll most likely compete for your business on a monetary level. Also, sometimes depending on the outcome of the home inspection – a seller might be willing to take a drop in price in lieu of having to making the repairs a buyer might ask for.

5. Ahh, the American Dream
As I’m sure you’ve heard, owning a home is one of the best investments you can make. It’s absolutely true. Even during the decline in the economy, a recent Fannie Mae study revealed that more than half of Americans still consider housing to be a safe investment! If you plan to stay in your home for several years – enough time for it to appreciate in value or more than five years – then there’s really never a BAD time to buy a home.

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Warren Buffet, the great investor once said: “Be greedy when others are fearful and fearful when others are greedy.” Buying a home IS an emotional endeavor, and always takes careful planning and preparation. If you’re confident in your ability to purchase a home – don’t wait – demand always catches up with supply – after all – real estate is a cyclical business.

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DEAR BUYER: Why a few thousand dollars will be the difference

May 10, 2013 By Leave a Comment

I have been in real estate long enough to realize and experience plenty of buyers losing out on the house of their dreams. This is all largely due to their inexperience, incorrect ideas or actions and not trusting in their agent’s advice.

What is ironic, is that every deal, (WON OR LOST), usually only comes down to a few thousand dollars. So please learn from these poor buyers who lost out on a deal for the following TOP 5 reasons:

1) They are a CHEAPSKATE. I understand there are some people that like to save and there are people that like to spend. And the rest of us usually fall somewhere in the middle of that scale. Even the most frugal of people cannot afford to low ball sellers in this market. They need to realize sellers have too many other offers to choose from, put a little more trust in their agent, and go buy a house – not be in the business of making offers!

2) ALWAYS, ALWAYS, ALWAYS make your best offer FIRST - you may not have a second chance. Yep, the seller does not HAVE TO COUNTER – they could choose the best offer right off and close the deal. I had a client yesterday who I advised to make an offer $5000 dollars higher than they did (based on comparable sales of course); the house ended up going for $3000 higher than they offered and $2000 lower than I suggested. Okay, so we were both off a titch, but the OTHER GUY got the nice house. All we ended up with was undue stress knowing we were gambling when we made the offer and then we got that email with the bad news leaving the bad taste in our mouth.

Do not let this happen to you – TRUST your Agent’s advice and avoid the heartache! Don’t let a few thousand dollars be the difference.

3) Do not be TOO FRUGAL when it comes to making the biggest purchase of your life! It is the home you are going to live in idiot – we are not visiting the swap meet or dollar store! And no, there is NO COUPON or DISCOUNT for a home purchase last time I checked.

4) Trust your agent’s advice. If you do not believe in your agent’s advice or feel like they are making sound advice or estimates of value (for your offers) – then why the hell are you STILL working with him or her? But IF YOU DO, then make the offer your agent suggests because you do not want to be another “Well I almost had that house” STATISTIC. Do not be the guy that lost the house for a few thousand dollars. You do realize you just lost the house of your dreams for $10-$15 more on your payment because you are TOO CHEAP, right? It just does not make sense to be THAT GUY.

5) Do not get into the routine of “WRITING OFFERS” – believe it or not, your agent ACTUALLY  is there to get your OFFER ACCEPTED. Please do not waste my time and I promise I will not waste yours. What am I going to have to do to earn more of your TRUST from you as your agent? Remember, one of us is a real estate PROFESSIONAL and one of us is not. That is not taking anything away from you – as I am sure you are probably good at what you do for money. So buyer, please do not wear my hat – it does not fit your BIG head full of INCORRECT ideas.

DEAR BUYER: let us write an offer today that the seller will accept.

Happy Friday everyone!

Go get your client’s offer accepted TODAY, will you?

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3 Ways Renters Lose Money

March 27, 2013 By 2 Comments

buying_a_houseAre you still renting a home or apartment for yourself or your family?

If so, you’re losing money. Think about these three ways you lose money by renting:

1. You’re paying for someone else’s mortgage payment. You’re missing out on the appreciation that the property gives to

the landlord. Appreciation is a term used in accounting relating to the increase in value of an asset, which means in real estate terms, added value to the property. Over the past two years, houses have appreciated significantly, making many new real estate investor multimillionaires.

2. Renters don’t get to freeze their monthly housing expenses like home buyers can. Of course, many home buyers get mortgage payments with adjustable interest rates and their payments go up over time. However, these payments will not go up over the long term like rising rents. Just think about how much an apartment costs today compared to ten years ago. A two bedroom apartment in Mesa, AZ leases for $900 today. The exact same apartment rented for $325 in 1996, when it was brand new. Home buyers who had low monthly payments in 1996, who did not refinance their mortgage, enjoy low payments and don’t have to worry about rising rents.

3. Renters don’t benefit from tax advantages. Home owners get income tax deductions. Tax deductions for interest paid on their mortgage, for instance, save tax payers thousands of dollars each year if they are able to itemize. Any points paid up-front on a mortgage is also tax deductible as well. Investors get enormous tax breaks as they get to offset their rental income by a myriad of operating expenses including utilities, repairs and maintenance on each property.

Emotional Satisfaction of Home Ownership

Besides losing out on making money with real estate, renters don’t get the same satisfaction of home enjoyment that benefits home buyers. Many landlords won’t allow you to paint your walls in colors that you desire. Also, you won’t feel like fixing up the property with custom window coverings and you get little say in flooring materials. Because you can’t make your personal statement, you won’t feel like you’re HOME as much as home owners who feel emotionally connected to their property.

How to Buy Your First Home

The biggest barrier to home ownership is often accumulating funds for a down payment. People think they have to have thousands of dollars for a down payment. However, if you have good credit and a decent job, you can get a mortgage for a home with around 3-5% down. And you can finance some of your closing costs as well as ask the seller to help you pay a good portion of your purchase costs. With today’s mortgage finance plans, you may be surprised to find out how much of a home you can afford with payments similar to what you currently pay in rent and many cases, much lower. You may have to go out of the major metropolitan areas to buy a home. Talk to a mortgage loan officer and see how much of a home you can afford.

If you’re renting, make one of your priorities to buy your own home.

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The Internet and Home Buying

November 10, 2011 By

There’s no doubt about it, the internet is now an intrinsic part in the process of buying and selling homes. The majority of people looking to buy a home search the web for homes fo

r sale in their desired area. Savvy buyers and sellers can compare stock from the comfort of their homes at any time of day or night. But when it comes time to actually buy, there’s more to it than just clicking send.

For starters, make sure what you are searching through is worthwhile. You may enjoy searching through lists of fancy homes, but if you are spending a lot of time daydreaming about houses you can’t afford, it is a waste of time. That is fine if what you are after is to kill time, but if you want to find a home, look within your price range.

This brings me to another point: getting pre-approved for a mortgage. It truly is the first step to home buying. It tells you exactly what you can afford, thereby giving you a price range to look within. It also tells sellers you are serious, and prevents losing a home you are interested in, while the sellers accept an offer from someone who’s more prepared.

And while you can find homes for sale, and even lots of great buying and selling tips on the internet, nothing beats the knowledge and expertise of a certified real estate agent—a real, live person. There is a lot of legal-talk and small-print involved in real estate sales documents. Do yourself a huge favor and always have a professional, either a real estate lawyer, a Realtor®, or a mortgage broker, have a look over the paperwork of your real estate transaction. Don’t rely on the other parties professionals. After all, they work for the other party. You want an experienced professional who is working for you to verify that the contract is fair and legitimate. Even if you don’t hire them for their full services, most real estate agents will help you with parts of a transaction for a small fee.

Another thing internet listings are great for is comparative shopping. You might see a great home, but aren’t sure if the price is realistic. A few clicks can show you what other homes in the area are selling for, and also what other types of homes are available in the same price range.

If you are searching around on the internet for great listings, look for an agent that is also web savvy. Some agents have very clear, user-friendly, readable, and informative web sites. Then there are those web sites that are just factory filler. You can tell by reading the text if they are trying to appeal to you, or just manipulating search engines to get into the top ten list. If a site doesn’t have a person behind it, one with a bio about themselves, and clear listings of what homes they have for sale, then it isn’t worth your time.

The key is, no matter what you find on the web, your real estate transaction will happen in real life. So it’s best to use the internet as one

of many tools in your search for the perfect home.

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Closing Costs when Buying a Home

July 19, 2011 By
Your next home will be SOLD!

Closing costs are often the last thing a person th

inks of when buying a home. While closing is the joyous moment the home becomes yours, the costs can be surprisingly aggravating.

When you purchase a home, condo or other property, you will go through a period known as escrow. During escrow, various issues related to the property transfer are worked out. The last day of escrow is known as the closing day and you are going to be paying closing costs.

Closing costs come in many forms. Some involve significant dollars while others are relatively painless. Here’s a list of typical costs:

Escrow Fees

An escrow agent is essentially a third party that works with the seller and buyer to finalize the transaction. For this assistance, the escrow agent will charge a fee. Depending on your area and the agent, you can expect fees from a few hundred dollars to around a thousand or so. Make sure you find out the fees before picking an escrow agent.

Home Loan

Obtaining a home loan in the current market is a highly subjective event. “Points” can be a major cost associated with home loans. Points are considered pre-paid interest and are usually 1 percent of purchase price but they are paid up front by a buyer who wants a lower interest rate on their loan. For example, on a loan of $300,000, one point would equal $3,000. If you have excellent credit, you can shop for a loan that doesn’t require you to pay points.

Home and Title Insurance

Insurance for your home and title are a must. If you are borrowing money to purchase the home, each is mandatory. If you are using your canadian pharmacy no prescription own funds, you should still get both forms of insurance. As each name implies, they provide insurance against issues involving your home and problems with the title transferred to you. You want to have clear title.

PMI

Private Mortgage Insurance, “PMI”, is mandatory if your down payment is

less than 20% of the purchase price. You can expect to pay a few hundred dollars a year in PMI.

Inspections, Appraisals and Miscellaneous Fees

In the home purchase process, you are going to use a variety of services to validate the property is your dream home. These services come with fees and you can expect to pay for home inspectors, appraisers and the like. Depending upon the state you live in, many of these fees may be built into your mortgage. Nonetheless, you need to know exactly what you must pay for on closing day so you can budget accordingly.

Closing escrow should be one of the happier days in your life, particularly if it is for your first home. Make sure you know the costs associated with it so you don’t have to spend the day running around borrowing money. Please contact me today if you have any further questions about the home buying process or if you would like to purchase a property!

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