A Realtor.com post from October 16th titled, “10 Things Most Homebuyers Get Wrong About Getting a Mortgage Today,” looks at common mistakes and provides insight to help home buyers navigate this process. 

1. Focusing too much on the interest rate.
   Be sure you understand any fees that could go along with the rate you’ve secured.
2. Assuming you need a 20% down payment.
   You can put down less, but will need to factor in private mortgage insurance.
3. Assuming you can get a loan instantly.
   There are applications, phone calls, document collection to consider… It takes time.
4. Thinking pre-qualification means you are approved for the loan.
   Pre-approval is more valuable, as it shows the lender has looked at your finances.
5. Not considering first-time homebuyer programs.
   Explore these options, and how they help free up savings.
6. Failing to check your credit score.
   Knowing your score before speaking with a lender is key.
7. Picking the wrong type of loan.
   There are pros and cons to each, do some reading to get a basic understanding.
8. Understanding fees beyond the down payment.
   Yes there are other fees when buying a home, i.e. closing costs, title, transfer taxes, etc.
9. Not preparing for the possibility of a low appraisal.
   With high listing prices this is a reality. Another recent post covered ways to deal with a low appraisal; ultimately you’ll want to consider what you are comfortable paying when making an offer.
10. Not shopping around for the right lender.
    Reliability is key, especially in today’s market when getting a response from a lender so you can make an offer is top priority. 

Bottomline if you want to avoid these common missteps that can trip up first time home buyers, or really anyone looking to buy a home in today’s market; understand your options, do your research and have a team of local professionals on your side.

The post Avoid Mortgage Missteps appeared first on Laffely Real Estate Associates.

If you are in the process of or preparing to buy a home, you’ll want to read this post from realtor.com, “Home Buyers’ 7 Biggest Regrets: How Many Will Haunt You?,” and heed the warnings of home buyers that have come before you. In the post, they share seven tales that feature stories of home buying remorse.

#1. Putting off house hunting until the last minute

#2. Overlooking schools, even if you don’t have kids

#3. Caving to a seller’s every demand

#4. Buying too big

#5. Overlooking small details

#6. Skimping on the number of bedrooms you actually need

#7. Underestimating walkability

Remember these stories when searching for your next home, or first home. No matter the market, you’ll want to make sure you end up with a treat; rather than the trick of regrets.

The post What Haunts Home Buyers appeared first on Laffely Real Estate Associates.

With yesterday’s news that the Federal Reserve (aka the Fed) may raise interest rates again, many homebuyers may be considering what their next move is.

Do they continue to house hunt?

Is now still the right time to buy a home?

Should they leap at the next house that becomes available?

Since buying a home is a big decision, these questions are always swirling. However, with the current housing market, they are more commonplace. One thing is certain, homebuyers should not panic. Panic leads to mistakes. The market always has its ups and downs, but any decision made should be based on the day-to-day needs of the prospective homebuyer.

Today’s blog post from Realtor.com, “The Massive Mistake Homebuyers May Be Tempted To Make Right Now: Is This You, Too?,” highlights concerns buyers have; especially when the market is unpredictable.

Example of Buyer Mistake

The post shares the story of buyers that put their housing search on hold. Their thought was prices would come down, but instead prices continued to rise. They inevitably panicked and purchased the home they were renting, even though it was too small and the layout didn’t suit their family. This is considered “FOMO buying” by an agent with Pacific Sotheby’s International Realty in San Diego. Fear of missing out should not be the reason to purchase a home…ever.

As Realtor.com’s Chief Economist Danielle Hale notes, “It is not a good idea to try to time the market. No one has a perfect view into the future. Whether you think rates or prices are going up or going down, the world may not evolve the way you expect it to. We all have to make decisions with that uncertainty.”

If you are in the market to buy a home, you’ll want to read through this post. Next step, meet with a realtor in the area of your home search. They will be able to guide and advise you to make the best decision based on your needs alone; not the ups and downs of the housing market.

Photo credit: Marco Verch Professional Photographer on Flickr. This image is available under Creative Commons 2.0.

The post Homebuying Mistakes: Don’t Pause Or “FOMO Buy” appeared first on Laffely Real Estate Associates.

With the current state of the market and the high rate of inflation over the past year, it is imperative now more than ever that you know what you want and what you are willing to take on when buying or selling a home. This will include your needs now and in the future. First step is always to write things down; think pros and cons list but this time you’ll be answering specific questions to help you define your goals.

A blog post from Keeping Current Matters from January 2^nd of this year highlights the key questions you should be asking yourself if you plan to enter the housing market in 2023. These include:

• What’s Motivating You?
• What Does Your Next Home Look Like?
• How Ready Are You To Buy?

Go ahead; answer these questions. Even with uncertainty in the market, you’ll know for certain what you are looking for. Once you have that piece, local experts from mortgage professionals to realtors are ready to step in and help you reach your goals.

The post Your Housing Market Goals in 2023 appeared first on Laffely Real Estate Associates.

A recent article posted on Bankrate notes that 2023 will be a transitional year with several factors creating uncertainty. The article looks at each of these factors in depth, calling on industry experts for their predictions. We’ve summarized here, but the full article is worth a read.

Mortgage and Interest Rates

With continued inflation, many experts believe rates will continue to rise for some, if not all, of 2023. The experts cited in the article all see interest rates in the 8 percent range at some time during the year. However, predictions are mixed on whether they remain there or stabilize toward the end of the year.

Housing Sales

The consensus here is that the market will cool down. Higher interest rates will lead to a drop in home sales. Experts also believe that average days on the market will increase in 2023, as buyers are more hesitant to jump into a purchase situation.

Home Values

Experts are split on where home values will land in 2023. Some believe home values will remain steady due to low inventory; while others suggest that home values could see a decline based on higher rates and more patient buyers.

Buyer’s or Seller’s Market

We’ve been in a steady seller’s market for the past few years, and many experts see this shifting slightly. One expert notes it will vary nationally, however. Markets with more demand could continue to favor the seller. That said another expert believes the sides may be on more even terms overall in the year ahead.

Housing Inventory

Low inventory has fueled the housing frenzy over the past few years. Experts believe this will not change; mainly due to the fact that homeowners won’t be willing to trade in their low interest rate mortgages for a higher rate loan. However, there are some that believe housing inventory could increase based on demand throughout the year.

Affordability

Experts do agree that home prices will not waiver significantly. We may see prices lower slightly, but any shift in prices will be cancelled out by rising interest rates. Some experts believe that in certain cases this could make homes seem even less affordable due to high interest rates and the amount they add to a monthly payment.

As with any forecast, no one can predict the future. We can only wait and see how the year unfolds, and remember that local experts and agents can provide the best insight into the market in your area. They are the best resource if you are looking to buy or sell in 2023.

For a deeper dive into the housing market in 2023 and these topics, you’ll also want to look at Realtor.com’s predictions.

The post What’s Ahead for the Housing Market in 2023 appeared first on Laffely Real Estate Associates.

Calmer Market Ahead

Expect some easing in sales, though prices will continue to inch higher

By Lawrence Yun (originally printed in the Spring 2022 issue of Realtor Magazine)

The past two years have been quite exceptional for real estate. Home sales boomed. Home prices rose at the fastest rate in modern times. However, such a strong housing market created growing pains. Inventory shrank to its lowest count ever. Even through the recent winter months, the inventory that has made it onto the market has typically attracted multiple bidders—and, increasingly, investors offering cash. Twenty-two percent of recent transactions were investor purchases, up from 15% a year ago, and 27% of transactions were cash-only deals, up from 19% a year ago. That’s putting a strain on first-time buyers. Moreover, mortgage rates are notably higher as the Federal Reserve moves from a quantitative easing monetary policy, quickly buying up mortgages, to what is in essence a quantitative squeezing that does the opposite. With all this in mind, what’s ahead?

Let’s begin with the jobs picture. Although the unemployment rate is back to normal at 4%, the economy is still short by nearly 3 million jobs compared to before the pandemic. But that hasn’t held back housing sales. Existing-home sales reached 6.12 million in 2021, the best since 2006. The median home price reached an all-time high of $347,100, a one-year gain of 16.9%.

A few states actually have more jobs now than before the COVID-19 days. They are Utah, Idaho, Texas, Arizona, Georgia, and Montana in order of performance. Those are also the states experiencing extra strong real estate activity, both in residential and commercial markets. Jobs are important.

What now, given the diminishing pandemic— fingers crossed—and rising mortgage rates? Office workers will need to get back to the office. Maybe the new work model will be some form of hybrid, with a few days each week spent in the office. This still means locational choices do not have to be inherently dependent on big-city downtowns. It’s fine to live farther from the city, given less time spent on the commute. Higher mortgage rates, though, will lock out some would-be buyers. In very high-cost areas, the increase means about $500 more in monthly mortgage payments for the typical borrower. Consequently, home sales will come down 2% to 4% in 2022. If inflation remains stubbornly high and the Fed is forced to be even more aggressive, then home sales could fall by as much as 10%.

Prices will keep rising, though, since getting to a balanced market will take time. The turnaround may occur by the middle of the year. Expect calmer home price gains of 3% to 6% per year in 2022 and 2023.

Reprinted from REALTOR® Magazine by permission of the National Association of REALTORS®. Copyright 2022. All rights reserved.

Photo by Sonja Langford on Unsplash

About the Author: Lawrence Yun
Chief Economist and Senior Vice President of Research at the National Association of REALTORS®

Yun oversees and is responsible for a wide range of research activity for the association including NAR’s Existing Home Sales statistics, Affordability Index, and Home Buyers and Sellers Profile Report. He regularly provides commentary on real estate market trends for its 1.3 million REALTOR® members.

Dr. Yun creates NAR’s forecasts and participates in many economic forecasting panels, among them the Blue Chip Council and the Wall Street Journal Forecasting Survey. He also participates in the Industrial Economists Discussion Group at the Joint Center for Housing Studies of Harvard University. He appears regularly on financial news outlets, is a frequent speaker at real estate conferences throughout the United States, and has testified before Congress. Dr. Yun has appeared as a guest on CSPAN’s Washington Journal and is a regular guest columnist on the Forbes website and The Hill, an “inside the beltway” publication on public affairs.

Dr. Yun received his undergraduate degree from Purdue University and earned his Ph.D. from the University of Maryland at College Park.

The post Calmer Market Ahead appeared first on Laffely Real Estate Associates.

The real estate market over the past few years – dare I say real estate’s COVID years – have been a lot of the same for all parties involved: record high home prices, lack of inventory and crazy bidding wars. All of this brings feelings of uncertainty and doubt for sellers and buyers, and sadly we can’t say it will be changing soon. So, how do you prepare for an anything goes market?

Being cautious and prepared for whatever comes your way is the golden rule. Something Real Estate Editor Clare Trapasso learned during her first home search. She shared her story in a recent post for Realtor.com. A MUST read if you are considering buying this year!

She writes about her confidence going into her search. She knew what to expect; heck she’d been writing about the market conditions and she was ready. But as Trapasso writes, “That optimism abruptly evaporated once we made our first offer on a house—and were promptly outbid by about $100,000.”

She goes on to admit that she realized covering this housing market would be nothing like actually entering the fray. After a long search and lots of disappointment, Trapasso and her partner closed on their home just outside of New York late last year. What lessons did she learn from her search?

1. Homebuying can take an emotional toll

2. You’ll likely have to make some compromises

3. Buying a home can be terrifying financially

4. Don’t settle for the first mortgage you’re offered

5. Don’t move money around, close bank accounts—or buy a new iPhone

6. Property taxes can add quite a bit to your monthly mortgage payments

7. Set some extra cash aside for your first few months in your new home

8. Expect the unexpected

If you are considering buying, read through each of Trapasso’s lessons. They are a true first-hand account of a home search and her story provides insight that will help you prepare. After reading, if you are ready to start the journey of buying a home, sit down with a local realtor; someone who can guide you through the market during this unprecedented time.

The post Lessons Learned From A First Time Homebuyer appeared first on Laffely Real Estate Associates.

As we enter the New Year, it’s a time for predictions. What will the 2022 real estate market look like? If you are planning on buying or selling this year, we know this question is top of mind.

While no one can predict the future, it seems we may see some similarities to 2021. According to Danielle Hale, Chief Economist at realtor.com, 2022 will continue to be a seller’s market. However, if you watch her recent video post, she does note some shifts.

Yes, Hale mentions that homes will continue to move quickly and prices will rise; however, she also points to the fact that there will be less competition overall. Hale adds that price growth will return to a more normal rate, but we do have to consider that prices are starting at 2021’s highs. The market will also see rising mortgage rates and more inventory.

Fueling the market in 2022 will be a new generation of homebuyers. Millennials will be a key buying demographic in 2022 as many will be at the prime age for buying a home. This will help fuel the market; as well as the trend of suburban living. Many millennials, and homebuyers in general, will continue to search for their forever home outside the city; a trend accelerated by the pandemic. The suburbs tend to offer more flexible space to live, work and play, and as people continue to spend more time at home the need for this space will be prevalent.

A final note from Hale, rising rents will also push more buyers into the market this year as they weigh the benefits of renting versus owning (stay tuned we are working on a post on this topic).

As stated above, nothing is set in stone but these are some things to consider as we look ahead into 2022. As always, we are here to help navigate the market in our area and would love the opportunity to help with your next move.

The post 2022 Real Estate Market Predictions appeared first on Laffely Real Estate Associates.

Homebuyers have had it rough over the past year, particularly in early 2021. With the prevailing market conditions favoring sellers, like low inventory and bidding wars, many are feeling discouraged about the home buying process. If you are one of those buyers, don’t give up on the search for your dream home just yet. According to recent research by realtor.com that was highlighted in a Keeping Current Matters blog post this week, buyers may have more opportunities in the weeks ahead.

In their research, they looked at housing market data from the past few years. They then applied what they learned to the current market. To sum it up:

“Nationally, the best time to buy in 2021 is the week of October 3-9. This week historically has shown the best balance of market conditions that favor buyers.”

No promises here, but we are definitely seeing market conditions change in our area, including several of the factors highlighted in the post:

Increased Housing Supply – We’ve seen more for-sale listings coming on the market over the past few weeks.

Fewer Bidding Wars – With more for-sale listings, there are more options for the home buyers currently house hunting to choose from; helping to avoid larger than life offers just to be in the running for a home.

Adjusted Home Prices – With more inventory, or options for buyers to choose from, sellers will consider price reductions in order to compete for buyers’ attention.

This fall could be the perfect time to make the move to owning a home. While you research market conditions and listings, you’ll also want to consider what waiting a year might look like. Keeping Current Matters offers more insight on this topic as well, in their post “Two Reasons Why Waiting a Year To Buy Could Cost You.” This post looks at projections for continued home price appreciation and higher mortgage rates.

With all this data in mind, continue your home search; and definitely sit down with local professionals who can guide you through the process – i.e. a mortgage lender and real estate agent are great resources for home buyers as they navigate the current and future market in our area!

Image by u_f8awlsnb from Pixabay.

The post Balanced Market Conditions a Plus for Buyers appeared first on Laffely Real Estate Associates.

If you live in a hot real estate market, the rumor mill is constantly spinning. Neighbors share stories about houses selling way over asking price, sight unseen! For sellers, these stories are encouraging but often misleading.

Many of these home-sale tales are anomalies. Not every seller will see the same results; especially if they price themselves out of the market hoping to be the next real estate success story everyone in town is talking about. With buyers exiting the market until things cool down, lower prices and inventory numbers up, we wanted to share some common real estate myths from Realtor.com’s recent post and the truth behind them.

1. ‘You don’t need to renovate—buyers will take anything’

Even in a super competitive market, like we are currently seeing, a seller cannot expect to garner top dollar for their home, if they are unwilling to make repairs or upgrades. Houses that need too much work can be a turn off to buyers, as many in today’s market are looking for move-in-ready.

The truth: Taking time to clean both inside and out, freshening up paint where needed, and minor repairs and upgrades, can go a long way.

2. ‘You can price your house sky high and get that amount’

In a hot market, sellers often feel they can list their home for whatever price they’d like. They need to consider that buyers need to see the list price as realistic based on the type of home, location and condition.

The truth: Pricing too high could cause the home to sit on the market for too long. This can create doubt for buyers, and lead to a lower sale price.

3. ‘Sellers don’t need to market their listing much—it will sell’

Just because the market is hot, does not mean no effort should be put into the marketing of the home. Listing details, photos, videos, virtual tours, etc. are all important pieces to a successful listing.

The truth: Many homebuyers start their search online. The more information you can provide potential buyers, the greater success you’ll have in bringing in solid prospects.

4. ‘In a bidding war, it’s a no-brainer to just pick the highest offer’

When sellers ask for potential buyers highest and best offers, many believe that the seller is going to take the highest offer price. This is not always the case because the highest offer may not be the best.

The truth: A seller often considers the terms of the offer as well. All cash can be attractive because it takes financing hurdles out of the equation. Buyers who have flexibility in regards to closing date, giving the sellers more time to find their next home, can also be quite appealing.

Read the full article from Realtor.com, as they provide additional insight. Then, if you are thinking about selling your home, or buying a home for that matter, take some time to discuss the market with a local realtor. They will be your voice of reason to ensure your next move is a success.

The post Common Home Sale Myths appeared first on Laffely Real Estate Associates.