Real Estate Information

Waupun Area Real Estate Blog

House to Home Properties LLC

Blog

Displaying blog entries 1-10 of 38

Drop in Inventory Fuels Sales Slowdown

by Keeping Current Matters

Drop in Inventory Fuels Sales Slowdown [INFOGRAPHIC] | Keeping Current Matters

SELLING YOUR HOUSE ON YOUR OWN COULD COST YOU

by Keeping Current Matters

In this extremely hot real estate market, some homeowners might consider selling their homes on their own which is known as a For Sale by Owner (FSBO). They rationalize that they don’t need a real estate agent and believe that they can save the fee for the services a real estate agent offers.

However, a study by Collateral Analytics reveals that FSBOs don’t actually save anything, and in some cases may be costing themselves more, by not listing with an agent.

In the study, they analyzed home sales in a variety of markets. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.” (emphasis added)

Why would FSBOs net less money than if they had used an agent?

The study makes several suggestions:

  • “There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.
  • “Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.
  • “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Conclusions from the study:

  1. FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
  2. The data suggests the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

As Dave Ramsey, America’s trusted voice on money, explains:

“Research has shown that, between mistakes, lack of negotiating skills, pricing errors and general exposure on the market, you’ll cost yourself more than the real estate commission…You’ll come out slightly better and with a lot less hassle if you use a top-shelf agent.”

What If I Wait Until Next Year to Buy a Home?

by Keeping Current Matters

What If I Wait Until Next Year to Buy a Home

We recently shared that national home prices have increased by 6.7% year-over-year. Over that same    time period, interest rates have remained historically low which has allowed many buyers to enter the  market.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage      interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 5.2% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 5.2% over the next twelve months as predicted by CoreLogic, here is a      simple demonstration of the impact that an increase in interest rate would have on the mortgage        payment of a home selling for approximately $250,000 today:

What If I Wait Until Next Year to Buy a Home? | Keeping Current Matters

Bottom Line

If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.

7 Things Sellers Should Know Before Their Listing is Live

by Jeff Dowler on Active Rain

7 Things Sellers Should Know Before Their Listing is Live 

 

7 Things You Must Know Before Your Listing Goes Live

 

Congratulations. You’re about ready to go live on the MLS and showings are going to start. You must be pretty excited to be at this point. But in order to be as successful as possible, there are some key things you need to know, and do!

 

FOLLOW THE SHOWING INSTRUCTIONS

checking the MLS about showing instructionsYou and your agent spent time discussing how showings are to occur and what instructions are given to buyer agents in the MLS. Hopefully you are making the house readily available to show!

 

Make sure you both agree on the instructions and that they are clear, easy to understand, and not limiting. Most importantly you need to follow them. Be sure to return calls or text messages promptly.

 

Try to be understanding if agents are a little late or early…it will likely happen now and

then since agents are usually showing multiple properties in the area.

 

EXPECT A LOT OF ACTIVITY

In our busy sellers market homeowners should expect a lot of showing activity, and likely starting right after the home goes live on the MLS, perhaps within minutes or an hour or  two. Whether you are coordinating appointments directly or your agent is doing this, you  will no doubt be busy. But that’s what you want, right?

 

So be prepared for a big change in your daily routine. If you are making the appointments, keep a detailed list of all callers, their contact information, and appointment times.

 

BE SHOW READY ALL THE TIME

Staged  for showingsYes, it can be a challenge since you may not live that way all the time, but it’s essential you are always prepared for showings, especially at the beginning when you will see the most activity.

 

Who wants to spend a lot of time picking up and cleaning which can happen if you let the mess take over?

 

It's important to remember you are selling a house, NOT your home – it’s a product that needs to look great!

 

It will be much easier to accommodate multiple showings, and not have to worry about the condition of the house, if it’s show-ready all the time(well, at least during the day), plus    that will take some of the pressure off you. No question it’s a challenge with young kids,    but they may be willing and able to help keep things picked up, especially if there is an incentive to do so.

 

LEAVE YOUR HOME FOR SHOWINGS

take you dog out for showingsIt can be a nuisance, especially if you are normally around during the day or don’t have any place special to go. But it’s in your best interest to be absent and not get into a Q and A with the agent and/or the buyers. That’s for YOUR agent to do to protect your interests.

 

Buyers and agents will want their private space to look on their own, and not feel uncomfortable taking their time to explore your home, and consider making it theirs! That’s why they are there, after all!

 

Showings are a good time to take Fido for a drive or walk about the neighborhood (NOTE: make sure you clean up your yard if your pet runs around outside!). Buyers don’t want to    be bothered by a noisy, or nosey, dog, and you certainly don’t want them to accidentally    let your fur friend loose.

 

DO NOT LET UNACCOMPANIED BUYERS IN

You have a listing contract with your agent, and any buyer who wants to see the house must be accompanied by a licensed real estate agent. Your agent will no doubt tell you this, too! While it’s unlikely, it could happen that a curious buyer will simply stop by, or a neighbor will bring a friend over.

 

Politely decline, give them your agent’s card, and ask them to either call for an appointment or talk with their agent about setting up a time to tour.

 

PROTECT YOUR VALUABLES AND IDENTITY

I have often been amazed at the things I see in people’s homes in plain sight when      showing them to buyers. Be absolutely sure to not leave personal stuff lying around:    money, checkbooks, jewelry, laptops, tablets, phones, bank and credit card    statements, small valuables, could prove overly tempting. This is particularly        important if you have an open house.

 

Anything of value, or personally meaningful to you, should be put away (better yet, locked up) to avoid the risk of theft. You might be accustomed to leaving all your bills out, or     other documents with personal information in them, but you are just courting identity      theft by doing do when selling your house.

 

CONTACT YOUR AGENT REGARDING ANY CONCERNS

It’s important to let your agent know right away if there are any issues that arise– a      window gets left open, the door is not locked, the agent does not show, someone shows up without an appointment when that’s required. Again these issues are generally exceptions   but they do happen.

 

And lastly…

 

BE FLEXIBLE

Selling a home is tough, and multiple showings, especially in the early days, is stressful.   And things do not always go as planned or hoped for. Agents are late or early, buyers       stay longer than you expect, and agents may request a last minute showing with little   notice. Keep in mind your daily routine may be altered a bit, or maybe a lot, due to  showings but keep in mind the priorities. But if you truly can’t accommodate a showing, that’s probably OK, but you had better be sure!

 

Selling your house is an exciting, as well as stressful, time when you go live, and in a busy market it’s to be expected. It may even feel a little overwhelming, and you might be  surprised at how much activity you get, and how quickly. But you probably don’t want to turn away showings because it’s a little inconvenient or you have already had a number of them scheduled.

 

You signed on to sell your house, which you are presumably committed to doing, so make the best of it, keep smiling, and know that lots of showings should mean one or more offers,      an accepted contract, and then no more showings unless you choose.

Home Buying Myths

by Keeping Current Matters

Home Buying Myths Slayed [INFOGRAPHIC] | Keeping Current Matters

Some Highlights:

  • The average down payment for first-time homebuyers is only 6%!
  • Despite mortgage interest rates being over 4%, rates are still below historic numbers.
  • 88% of property managers raised their rents in the last 12 months!
  • The credit score requirements for mortgage approval continue to fall.

Getting Pre-Approved

by From Keeping Current Matters

Getting Pre-Approved Should Always Be Your First Step

Getting Pre-Approved Should Always Be Your First Step

In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the ‘4 Cs’ that help determine the amount you will be qualified to borrow:

  1. Capacity: Your current and future ability to make your payments
  2. Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
  3. Collateral: The home, or type of home, that you would like to purchase
  4. Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so.

How Much Will Innterest Rates Rise In 2018?

by Steve Cook from Homes.com

How Much Will Interest Rates Rise In 2018?

 

The dawn of a new year brings with it the new chairperson of the Federal Reserve, Jerome Powell. In one of Janet Yellen’s final acts before leaving office in early February, she presided over the Fed’s decision not to raise mortgage interest rates during the first quarter of the year.

Powell is expected to continue the Federal Reserve’s conservative policy of raising rates gradually if the economy remains strong. Should inflation increase, we can expect the Fed to act more aggressively and raise rates faster. During the current economic boom, inflation has been low but may increase as the economy grows.

Other factors besides the Federal Reserve’s policies on interest rates that determine mortgage interest rates are international political and economic crises and monetary policies of major trading partners. These two factors are very difficult to anticipate.
2018 interest rates rising

2018 Outlook

Rates have been remarkably low since the recession and for several years, expert forecasters have been calling for significant increases. Rates have bounced up and down and only in the past 18 months have rates been rising steadily, reaching 4.22 percent for a 30-year fixed rate mortgage in early February.

Continued economic growth, increased borrowing due to the expectation that rates will rise in March or June and a healthy housing market has created a strong consensus among forecasters that this year rates on a 30-year fixed rate loan could break the 5 percent barrier. Top housing economists at Fannie Mae and Freddie Mac forecast annualized rates this year will reach from 4.1 percent to 5.6 percent, higher than they have been since the spring of 2010.

What Rising Rates Mean

The psychological impact of rising rates on home buyers is often greater than the actual impact a rate increase has on the cost of a mortgage. However, in today’s environment of rising rates and rising home prices, affordability suffers as well.

Should rates rise by as much as 0.5 percent and house prices rise 5 percent (prices rose about 5.8 percent in 2017), a borrower’s monthly principal and interest payment will be more than 10 percent higher than it was before the increases. Prices are forecast to continue to rise in 2018, but not as much as in 2017.

In this scenario, rising prices and rates could have an unexpected impact on home sales this year, particularly among first-time buyers.
2018 interest rates credit score

How to Reduce Your Interest Rate

Most buyers don’t realize that they can influence the mortgage interest rate they receive. Here are three strategies to help you get a lower rate:

  • Higher credit scores mean lower rates. You need a good credit score to get a mortgage today. You need an even better one to get a lower interest rate. Credit scores assess risk and lenders raise interest rates on borrowers with higher risk. For example, if you have a $100,000 30-day fixed rate mortgage, and your FICO scores is 640 to 659, you might be offered an interest rate around 4.986 percent at current rates. If you have better credit, say between 700 to 760, your rate will be around 4.165 percent. The difference is significant. A borrower with lower credit score would pay $$25,755 more in interest over the life of the loan. The borrower with better credit will have monthly payments of $487 compared to the $539 that the other borrower would pay.
  • Consider a rate lock if rates are rising. If you fear that interest rates might rise between the time your offer on a home is accepted and closing, you can ask your lender to lock your rate during until you close. Your lender will charge a fee for a rate lock, and if you think that your closing might be delayed, the cost of your rate lock will rise.
  • Shop around for a lender. When lenders advertise low rates, they are citing the very lowest possible rate they will give, usually for someone with excellent credit and a smaller mortgage. Don’t shop for a lender-based ad you see. You will never end up with the advertised rate if you have normal credit. Call and ask for rate at your credit score.

Spring Cleaning: How To De-Clutter Your Home

by By Alex Thatcher of Homes.com

Spring Cleaning: How To De-Clutter Your Home

 

A Comprehensive Guide for a Happy Home This Spring

If your house still feels like it’s stuck in winter’s eclipse as the crocuses pop their heads out of the ground and the birds fly north again, then it may be time to start your spring cleaning. Spring cleaning is the yearly scramble to reset your home after a long winter. But it can be overwhelming to try to de-clutter your entire home all at once.

Instead, start by taking inventory of what needs to be done, going room by room. If your to-do lists start to get long, don’t get overwhelmed or discouraged. Your spring cleaning doesn’t need to be completed after one weekend — you can stretch the tasks out over a few weeks so that everything gets completed without any stress.

Create a spring cleaning calendar so that everything gets done in good time. Before you begin, invest in new storage spaces and organization units. As you clean each room in your house, store or discard all items you don’t use regularly. Items that you do use regularly — like TV remotes, pens, and other useful nick-knacks — should go in organized drawers so that they are out of sight but still accessible.
spring cleaning your home

Cleaning Up the Bathrooms for Spring

Tackle the bathrooms first to get you in the spring cleaning zone. Wipe down the walls and use strong cleaning supplies in the sinks and tubs. Let the cleaning agent sit for a few minutes as you load your bath mats in the washing machine, but hold off on running the machine until you have your linens from the bedroom. After 20 minutes, rinse everything starting with the highest point, the shower head.

Tackle the toilet with the same vigor as the sink and shower. Use glass cleaner on mirrors and windows. Finally, sweep and mop the floors. Make sure to wash all wipes and cloths before using them in other parts of your house.
spring cleaning your home

Sparkling Clean Bedrooms

Once the bathrooms are clean, you can move on to bedrooms. Use a vacuum and wipes to clean the walls and clear them of dust and cobwebs. The Spruce notes that the key to preventing scratches caused by the vacuum is to use a vacuum brush attachment. Dust all of the surfaces in each room, including trim and molding. You may need to move your bed out into the middle of the room—trust us, it’s worth it.

Throw drapes, sheets, and other linens into the wash with your bathroom linens and run the load. Wash window treatments and the insides of your windows with glass cleaner. Make sure you open your windows to let some fresh air start circulating.

The last step will be to shampoo your rugs and carpets. Apartment Therapy recommends using a mixture of salt, borax, and vinegar on visible stains. They also recommend renting or investing in a steam cleaner in order to avoid using harsh chemicals. Store heavy winter blankets in blanket trunks or a linen closet in order to minimize clutter.

Kitchen

If you are trying to finish your spring cleaning in just one day, stop for lunch and hydration right before you hit the kitchen. Then move on to your fridge and freezer. Throw away old food, uneaten leftovers, and expired condiments from your fridge. Then empty your fridge completely for a scrub down before putting away the remaining food.

Disinfect and degrease all appliances next. Cleaning a gas stove can be a little tricky, but The Maids suggests using baking soda or vinegar to remove the film of grease from burners.

Dust the insides and outsides of all cupboards, drawers, and cabinets. Then sweep, vacuum, and mop the floors. Go through any stacks of paper and all of the catch-all spaces, discarding everything that you no longer need and filing important items.

Living Room

spring cleaning your home

Do a thorough dusting of all furniture, mantles, window sills, TV and other electronics, light bulbs and ceiling fans. Wash furniture upholstery — if you have tough stains on couches or chairs, you can spot clean using the same solution you used on the rugs. You can also vacuum and lint roll couches and chairs. Wash windows and clean window treatments.

You can run a separate load of laundry for area rugs, throw blankets, and other linens you may have in your living room. If you have a fireplace, sweep it. Then move onto carpets, cleaning them the same way you cleaned the carpets in the bedroom.

Outside the Home Gets a Cleaning, Too

Plan to tackle your home’s exterior the weekend after you do the interior; that way, you won’t get exhausted. If you have a garage or tool shed, this is where you should start. Take any outdoor appliances that no longer work to the dump in order to clear up some space. Use this time to rake up soggy leaves and check your gutters and roof.

Take Your Home by Storm This Spring

When you methodically go through your home, deep cleaning and de-cluttering, the organization tends to happen naturally. As you clean each room, discard items that you no longer use. Any items that are cluttering up visible surfaces should go into closet organizers and drawers so that all surfaces feel free and minimal.

At the end of your clean sweep, take a deep breath. You will feel more relaxed and more energized when your home is clean and organized. Now bring on the spring weather!

Will Home Prices Continue To Rise In 2018?

by Steve Cook from House.com

Will Home Prices Continue To Rise In 2018? 

by STEVE COOK
 
 

If you’re thinking of buying or selling a home in 2018, you should know what to expect the housing markets will look like next spring.

Not long ago, before the housing boom and bust, forecasting housing markets was a relatively easy matter for most economists. Real estate prices were a matter of supply and demand. As supplies increase, prices decline. As demand increases, prices rise. Mortgage interest rates, income levels and demographic factors all impact housing demand, and economists can forecast it.
House For Sale
Lately, that formula hasn’t worked very well. The healthier economy is providing better incomes, and millennials are ready to buy their first homes. Mortgage rates remain relatively low, so demand should be high, and therefore prices will rise. However, over the past three years, demand has not been as healthy as anticipated. Many potential young buyers are saddled with student loan debt and cannot afford a mortgage. Rents have been rising as fast as home prices, making it hard for renters to save for a down payment.

Appreciation rates rose sharply in 2013 and have continued to increase at a rate of 5 to 7 percent a year. In light of weakening demand, the experts expected price increases would start to slow down. Appreciation rates rose about 6 percent in 2015, so housing economists, including those that work for the nation’s leading real estate organizations, predicted the price increases would slow down this year (see table below).

Four out of five were wrong. Rates in 2017 have increased at about the same rate as in 2016. Once again, the forecasters are predicting that 2018 will be the year that appreciation rates change direction. Will they be right this time?
Will Home Prices Continue to Rise in 2018.docx Google Docs
The factor that affected this year’s forecast had nothing to do with demand. Instead, the problem was on the supply side of the equation. For at least the third year in a row, supplies of homes for sale have been at least 10 percent lower than the previous year; in 2017, about one-third fewer properties were listed for sale than in 2014. As demand has softened, supply has declined even more.

At least six factors are causing the drought:

  • New home construction has not kept up with demand. Home builders were devastated by the housing crash and now are suffering from shortages of supplies and skilled labor.
  • About one-quarter of all retirees are staying in their homes rather than selling them. These are Boomers, the generation second only to millennials in size.
  • Move-up buyers are not moving up because they can’t find a larger home that they can afford. This “Catch-22” problem is extraordinarily difficult to solve.
  • Home prices are just now returning to their peaks since 2006. Owners who bought at the height of the housing boom are finally in the black. After a long decade, their houses are worth more than what the paid for them, and they want to make a little more.
  • During the housing crash, six million or more homes went into foreclosure. About four million were converted in rentals. With rents booming, not many landlords want to sell.
  • For these reasons and others, people are staying longer in the homes they own. The average homeowner’s tenure has risen from eight to ten years. People who buy homes today say they expect to stay in them at least 15 years.

Again this year, the forecasters are predicting prices will rise more slowly in 2018. The inventory shortage got so intense this year that thousands of first-time buyers gave up because they couldn’t find homes to buy. Young buyers will continue to be frozen out of homeownership until either income rises or prices settle down.

What do you think? Will prices finally slow down in 2018 as forecasted, or not? Pay attention to real estate market reports for December and January. If inventory levels are still lower than the previous year, housing markets will already be in trouble by the time spring markets open.

Remember that all real estate is local. Every market is different, and yours may not follow these national trends. Inventory shortages are higher on the East and West Coasts and in the suburbs rather than in rural markets.

What Is Private Mortgage Insurance (PMI)?

by Keeping Current Matters

 

What Is Private Mortgage Insurance (PMI)?

What Is Private Mortgage Insurance (PMI)? | Keeping Current Matters

When it comes to buying a home, whether it is your first time or your fifth, it is always important to know all the facts. With the large number of mortgage programs available that allow buyers to purchase homes with down payments below 20%, you can never have too much information about Private Mortgage Insurance (PMI).

What is PMI?

Freddie Mac defines PMI as:

“An insurance policy that protects the lender if you are unable to pay your mortgage. It’s a monthly fee, rolled into your mortgage payment, that is required for all conforming, conventional loans that have down payments less than 20%.

Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

As the borrower, you pay the monthly premiums for the insurance policy, and the lender is the beneficiary. Freddie Mac goes on to explain that:

“The cost of PMI varies based on your loan-to-value ratio – the amount you owe on your mortgage compared to its value – and credit score, but you can expect to pay between $30 and $70 per month for every $100,000 borrowed.”

According to the National Association of Realtors, the average down payment for all buyers last year was 10%. For first-time buyers, that number dropped to 5%, while repeat buyers put down 14% (no doubt aided by the sale of their homes). This just goes to show that for a large number of buyers last year, PMI did not stop them from buying their dream homes.

Here’s an example of the cost of a mortgage on a $200,000 home with a 5% down payment & PMI, compared to a 20% down payment without PMI:

What Is Private Mortgage Insurance (PMI)? | Keeping Current Matters

The larger the down payment you can make, the lower your monthly housing cost will be, but Freddie Mac urges you to remember:

“It’s no doubt an added cost, but it’s enabling you to buy now and begin building equity versus waiting 5 to 10 years to build enough savings for a 20% down payment.”

Bottom Line

If you have questions about whether you should buy now or wait until you’ve saved a larger down payment, meet with a professional in your area who can explain your market’s conditions and help you make the best decision for you and your family.


Displaying blog entries 1-10 of 38