The housing market has undergone some fundamental changes over the past few months. With the mortgage industry debacle still haunting our thoughts and the resultant increase in foreclosure properties, now, more than ever, is a time for thoughtful deliberation.
Credit is tighter, inventory is higher, and with inflation eroding our finances, it’s a time to move carefully.
Today’s market is definitely not a good one for those wishing to “flip” properties. The rules and timetables have changed quite dramatically and that requires a more conservative strategy.
For first time home buyers, the time is generally right for you to enter the housing market; if you’re looking at investment properties, not so true. While there are and likely will always be, good deals on the market, this particular market is going to require a more deliberate and calculated approach.
For investors, we recommend rather than flipping, a strategy of refurbishment and renting / leasing at this time. There are many foreclosure properties that can make this an attractive course to pursue presently.
Thursday, July 24, 2008
Monday, February 11, 2008
Time to Rent or Time to Buy?
This is a question that never fails to elicit strong opinions. To Start the ball rolling, just click on the title directly above this post to get the opinion of one real estate professional.
As is the rule with most real estate, it's very important to remain aware that real estate is always an intensely localized market...
Your comments are encouraged and always welcome.
As is the rule with most real estate, it's very important to remain aware that real estate is always an intensely localized market...
Your comments are encouraged and always welcome.
Wednesday, January 23, 2008
Buyers' Market?
Looking at the amount of inventory available, it's easy to assume that it's a buyer's market again. Easy to assume unless you carefully study this particular market...
When you really investigate, it's true that there are more properties on the market than there were a year ago. The difference now, is that properties are remaining on the market longer, and generally, prices haven't really subsided relative to the current market conditions.
Part of this what I'll call market lag, is the unwillingness of sellers to face the realities of the day. Money is tighter, buyers are fewer and more cautious. As a result, market values are being challenged a bit and competition is greater due to the increased inventory.
Combine the current market conditions with the stiffer qualification required by lenders, and you've got a market that's a little sluggish.
The one tried and true cure for a sluggish market is price reductions. Unfortunately, many sellers are slow to wake up and smell the coffee, still clinging to the wild ride of a year ago when they could pound a sign in the ground and have an offer in hand before they walked back to the house. (Okay, okay, that's a slight exaggeration, just checking to see if you're really reading this post.)
Regardless, the market is a bit slower now than it was a year ago. All things considered and in the wake of the mortgage crisis, it's still not in too bad a shape.
One thing you must keep in mind is that no matter what the market, the best properties don't last. This is just a reminder that when you do find a home you like, make an offer, don't assume that it will still be available tomorrow and you may have found your new home.
There's a saying in the industry; "If you sleep on it, you may not sleep in it". This has never been more true than it is in our present market.
When you really investigate, it's true that there are more properties on the market than there were a year ago. The difference now, is that properties are remaining on the market longer, and generally, prices haven't really subsided relative to the current market conditions.
Part of this what I'll call market lag, is the unwillingness of sellers to face the realities of the day. Money is tighter, buyers are fewer and more cautious. As a result, market values are being challenged a bit and competition is greater due to the increased inventory.
Combine the current market conditions with the stiffer qualification required by lenders, and you've got a market that's a little sluggish.
The one tried and true cure for a sluggish market is price reductions. Unfortunately, many sellers are slow to wake up and smell the coffee, still clinging to the wild ride of a year ago when they could pound a sign in the ground and have an offer in hand before they walked back to the house. (Okay, okay, that's a slight exaggeration, just checking to see if you're really reading this post.)
Regardless, the market is a bit slower now than it was a year ago. All things considered and in the wake of the mortgage crisis, it's still not in too bad a shape.
One thing you must keep in mind is that no matter what the market, the best properties don't last. This is just a reminder that when you do find a home you like, make an offer, don't assume that it will still be available tomorrow and you may have found your new home.
There's a saying in the industry; "If you sleep on it, you may not sleep in it". This has never been more true than it is in our present market.
Sunday, January 6, 2008
Planning to Sell Your Home?
If you're considering selling your home, it's a good idea to obtain a loan pre-approval for your next home before selling.
With changes in the mortgage industry, the loan amount you qualified for in the past may no longer apply. You'll want to be sure that when you do sell your home, you'll have the ability to replace it with another.
A common misconception is that you shouldn't sell your home until you find another.
The reality is that it's best to sell your home first, then find another. As a minimum, you should have your home actively listed for sale prior to looking for another home in earnest.
The benefit to you, in selling first and buying later, is that you're in the best possible position to negotiate a good price. The reason you'll be able to negotiate a good price is that you'll be able to close on your new home quickly and that may be just what a seller needs.
This places you at a premium from a sellers point of view. The seller knows he has a bona fide buyer and will be more likely to agree to a lower offer from you, versus a person who still has to sell their existing home, or worse yet, someone who doesn't even have their home listed for sale.
Your agent can help to coordinate the closings on your present home and your new home to help mitigate any possible inconvenience.
With changes in the mortgage industry, the loan amount you qualified for in the past may no longer apply. You'll want to be sure that when you do sell your home, you'll have the ability to replace it with another.
A common misconception is that you shouldn't sell your home until you find another.
The reality is that it's best to sell your home first, then find another. As a minimum, you should have your home actively listed for sale prior to looking for another home in earnest.
The benefit to you, in selling first and buying later, is that you're in the best possible position to negotiate a good price. The reason you'll be able to negotiate a good price is that you'll be able to close on your new home quickly and that may be just what a seller needs.
This places you at a premium from a sellers point of view. The seller knows he has a bona fide buyer and will be more likely to agree to a lower offer from you, versus a person who still has to sell their existing home, or worse yet, someone who doesn't even have their home listed for sale.
Your agent can help to coordinate the closings on your present home and your new home to help mitigate any possible inconvenience.
Tuesday, January 1, 2008
Thursday, December 13, 2007
How to Buy a Home With Zero Down
How to Buy Your First Home With No Downpayment
As a result of all the hype surrounding changes in the mortgage industry, there’s been a lot of confusion regarding zero down and first time homebuyer loans.
The news isn’t so bleak as you’ve been led to believe. There are still loans for first time homebuyers and zero down loans are still available.
The changes relate primarily to minimum credit scores required. Those changes likely won’t affect most first time buyers provided they pay their bills on time. You’ll need to consult a mortgage professional for details on this as it may affect your personal situation.
Regardless of whether you’re a first time buyer or an old pro, it’s an excellent idea to find out how much you qualify to borrow prior to beginning your home search.
Armed with this information, and a pre-approval letter from your lender, you’re ready to begin your search.
Having a loan pre-approval letter in your pocket when you make an offer on a home places you in a very strong bargaining position. The seller, knowing that you’re a capable buyer will weigh your offer carefully in light of this information. This often results in a more favorable outcome for you. Sellers are much more likely to accept a lower offer when they know that you have the power to purchase their home.
In order to obtain a loan pre-approval (as opposed to a pre-qualification) you’ll need to meet with your mortgage professional and provide the needed documentation. This usually requires that you physically meet, and go over the information together.
Prior to your meeting, it’s also a good idea to have gone over your credit report and resolved any errors or surprises. You may obtain a free copy of your credit report by going to http://www.freecreditreport.com/ or http://www.annualcreditreport.com/
Please let us know if you have any questions, or need clarification of any of the information above. Our contact information is available at: http://www.themesarosteam.com/
As a result of all the hype surrounding changes in the mortgage industry, there’s been a lot of confusion regarding zero down and first time homebuyer loans.
The news isn’t so bleak as you’ve been led to believe. There are still loans for first time homebuyers and zero down loans are still available.
The changes relate primarily to minimum credit scores required. Those changes likely won’t affect most first time buyers provided they pay their bills on time. You’ll need to consult a mortgage professional for details on this as it may affect your personal situation.
Regardless of whether you’re a first time buyer or an old pro, it’s an excellent idea to find out how much you qualify to borrow prior to beginning your home search.
Armed with this information, and a pre-approval letter from your lender, you’re ready to begin your search.
Having a loan pre-approval letter in your pocket when you make an offer on a home places you in a very strong bargaining position. The seller, knowing that you’re a capable buyer will weigh your offer carefully in light of this information. This often results in a more favorable outcome for you. Sellers are much more likely to accept a lower offer when they know that you have the power to purchase their home.
In order to obtain a loan pre-approval (as opposed to a pre-qualification) you’ll need to meet with your mortgage professional and provide the needed documentation. This usually requires that you physically meet, and go over the information together.
Prior to your meeting, it’s also a good idea to have gone over your credit report and resolved any errors or surprises. You may obtain a free copy of your credit report by going to http://www.freecreditreport.com/ or http://www.annualcreditreport.com/
Please let us know if you have any questions, or need clarification of any of the information above. Our contact information is available at: http://www.themesarosteam.com/
Thursday, December 6, 2007
The Home Buying Process
10 Steps to Buying a Home in North King and Snohomish County
There are many things to consider when buying a home . Some of the most important steps to buying a home are:
There are many things to consider when buying a home . Some of the most important steps to buying a home are:
Step 1: Learn the Home Buying Process
Start by learning as much as you can about how the home buying and mortgage application process works. Read as much as you can about buying a home. If you're a first time home buyer, check out the many books in your local library that offer hints to first time home buyers. Your agent can also provide you with valuable guidance.
Step 2: Find Out How Much You're Qualified to Borrow
It’s important to find out how much you can borrow before you start looking for a home. Your Mortgage Professional will assist you with this process. They'll be able to help you determine how much you can borrow based on your annual income. If necessary, your agent can help you find a mortgage professional to get this process started.
Step 3: Get Pre-approved for a Mortgage Loan
The next step is to get pre-approved for mortgage financing. This is similar to getting pre-qualified, but it’s a more formal process. Your Mortgage professional can help you get pre-approved. You will need to supply proof of your income for the pre-approval process to move forward.
Most real estate agents in North King and Snohomish County (as well as sellers) prefer potential home buyers to be pre-approved before searching for a home.
Step 2: Find Out How Much You're Qualified to Borrow
It’s important to find out how much you can borrow before you start looking for a home. Your Mortgage Professional will assist you with this process. They'll be able to help you determine how much you can borrow based on your annual income. If necessary, your agent can help you find a mortgage professional to get this process started.
Step 3: Get Pre-approved for a Mortgage Loan
The next step is to get pre-approved for mortgage financing. This is similar to getting pre-qualified, but it’s a more formal process. Your Mortgage professional can help you get pre-approved. You will need to supply proof of your income for the pre-approval process to move forward.
Most real estate agents in North King and Snohomish County (as well as sellers) prefer potential home buyers to be pre-approved before searching for a home.
Step 4: House Hunting in North King and Snohomish County
After you’ve been pre-approved for your mortgage loan, it’s time to begin your home search. Your realtor will work with you to find the right home for your unique needs.
Step 5: Crafting Your Offer
After you’ve found the home you want, your real estate professional will work with you in formalizing the purchase contract and presenting your offer to the seller.
Your mortgage professional can provide you with a loan pre-approval letter. You’ll need a copy of this mortgage pre-approval letter to accompany your offer. You’ll also be expected to include a check for "earnest money" - the amount will depend on the price of the home you are buying. Usually, in our area, the minimum amount for the "earnest money" is generally 1 1/2 to 3% of the sales price. This amount will show that you are serious about buying the home, and will be applied toward your down payment at the close of escrow.
Step 6: Negotiation Process
If the seller accepts your first offer, congratulations, however it’s likely that the seller will come back with a counter-offer. This negotiation process can go back and forth for a while, depending on factors like the motivation of the seller, the local market conditions, and a host of other factors. Your realtor will help you through this negotiation, and make it less stressful. After all, they’ve been through this process many times before.
Step 7: Provide a Copy of the Purchase Agreement to Your Mortgage Broker
After your offer has been accepted, your agent will present your mortgage broker with a copy of the Purchase and Sale Agreement for the home.
Step 8: Work to Close the Mortgage Loan
After presenting the Purchase Agreement, you’ll need to work closely with your mortgage broker to ensure you meet all the conditions required for the closing of the mortgage loan.
Step 9: Home Inspection Prior to Closing
Within the first few days following acceptance of your offer, you're advised to have a thorough home inspection performed by a qualified and certified home inspector. A home inspection will protect you from flaws in the construction and condition of the home that are not obvious to the untrained eye. Home inspections can uncover things like foundation cracks, termite infestation and other home quality issues. There are many good home inspectors in the North King and Snohomish County area. If any problems are found, there is a provision in the contract to either withdraw the offer or request repairs.
Step 10: Close of Escrow
After the home inspection has been performed and the report has come back clean (or all the items uncovered have been repaired, or negotiated) the process will move forward to the close of escrow. In Washington, the close of escrow is pre-determined when the offer is made, the typical time is approximately 30 days following acceptance of the offer. Officially, the "closing" is when the deed is recorded, so you will be signing final documents, making the down payment and the mortgage loan will be funded prior to this. If you're from out of the area, all of this can be accomplished through fax or email.
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