Category — Real Estate News & Tips

Home Improvement Projects That Aren’t Worth DIYing

Generally, DIY can save homeowners money. For example, HomeAdvisor reports that a homeowner who chooses to install their own linoleum flooring may save as much as $5,000 compared to a homeowner who hires a contractor. However, some projects are simply too complex, involve too much risk and require too much specialty knowledge for homeowners to DIY.

Damage from Smoke or Fire

Smoke and fire can do terrible damage to a home. Smoke damage can affect everything from clothing to upholstery, carpet and the very walls of the home.

While homeowners can use specialty cleaning products to remove soot, and can replace drywall relatively inexpensively, odor removal requires specialty tools that can be expensive to purchase and difficult to rent. Thermal fogging and ozone treatment are two of the most common methods that professionals use to remove the smell from a home.

A typical homeowner will pay between $3,000 and $22,000 for smoke damage restoration, yet performing the DIY project may be even more expensive. If the homeowner’s efforts fail, hiring a contractor afterword to finish the job could make the effort more expensive than if the homeowner had hired the contractor in the beginning.

Damage from Wind

Wind can damage everything from the home’s siding to roof. Repair work can be extensive, and many DIYers take much longer than contractors to make repairs. During that time, the home is vulnerable to damage from rain and the other elements. Homeowners who try to repair their own roof or siding may save on labor but could cause other costly problems while fixing one problem at a time.

The advantage of hiring a contractor for this work is that the contractor has all the tools on hand to fix the job and will likely have a crew of people as well. Whereas a damaged roof and siding can be repaired in a weekend by a contractor, a homeowner could take many days or weeks.

Wind damage can cost between $2,000 and $10,000 to repair via a contractor. Homeowners hoping to save money can do some of the work on their own. For example, the homeowner can cut fallen tree branches to a more manageable size, then may haul them away to save on clean up costs from the contractor.

Earthquake Retrofitting

This type of project requires a lot of specialty knowledge about a variety of systems in the home. Retrofitting takes place in the basement or crawlspace and up into the exterior walls. Earthquake retrofitting is done by bracing the walls and by anchoring the home to the mud sill or bolting the foundation, whichever is appropriate.

The cost to earthquake retrofit a home is approximately $4,000. However, if the efforts fail, the home could be seriously damaged or completely destroyed. Foundation repair after an earthquake can cost as much as $25,000, while the replacement of the entire home is far more costly. The best way to ensure that the home will survive a major earthquake if one happens is to hire a contractor.

Mold Damage

Mold is a serious problem that often occurs after a flood. Water damage after a flood can cost between $1,000 and $4,000 to repair, with mold remediation being a large part of that. Angie’s List reports that mold remediation can cost between $2,700 and $3,300. Mold remediation costs over $500 should be handled by a licensed contractor because mold remediation can be invasive and could potentially do damage to the home.

Mold remediation involves an assessment of the home, contamination control, source removal and moisture control. This multi-faceted project must be comprehensive, or mold will return.

Homeowners who aren’t sure about a DIY project can contact their contractor for more information. Speaking to a contractor can help the homeowner get a sense of how much a project will cost and whether it can be completed as a DIY.

Written by Monica Thomas

Source: https://realtytimes.com/consumeradvice/homeownersadvice/item/1016430-20180406-home-improvement-projects-that-are-not-worth-diying?rtmpage=

April 6, 2018   No Comments

Get Your Home Summer Ready Now Before It Gets Scorching

Do you live in a part of the country that’s still dealing with sub-zero temps? Maybe you’re lucky enough to be in that in-between place where you don’t have to run your heater or your air conditioning – for at least the next few weeks, anyway. Regardless of your location, now is a great time to start thinking about summer and getting your home prepared. Paying attention to a few maintenance items can give you a leg up on the season so you don’t need to wait in line for repairs once summer heat hits.

Check your roof

If you’re in a part of the country that had a rough winter, you definitely want to check your roof to make sure it hasn’t been compromised. A summer rainstorm could provide a not-so-fun surprise leak right over your couch. However, if spring storms that can include tornadoes and hail are normal for your location, you may want to wait until closer to summer—or check again at the end of the season.

“Check for misaligned, cracked or missing shingles, all of which can let water seep in,” said Liberty Mutual. “Also check flashing (those metal pieces where the shingles meet places like your chimney) for rust, and inspect the caulk around pipes or skylights to be sure it hasn’t cracked. Take a look at the chimney. If it’s masonry, inspect the joints between bricks or stones for pieces that have fallen out or have vegetation growing in them. Both could be signs of water problems.”

Get your air conditioning serviced

Here’s what’s going to happen if you don’t: There’s going to be a scorching heat wave in your city, causing everyone to flip on their air conditioning at the same time as you turn on your A/C—which, of course, will not work. And neither will the air conditioning units of numerous other people, all of whom will be calling for service at the same time.

No one wants to be forced to wait several days (at least), all sweaty and angry, for a repairman to come and provide some relief. Do yourself a favor and schedule a servicing now so you’re good to go when the temperature rises.

Check your sprinklers

If it’s been months since you’ve used your sprinklers, you just don’t know if they’re still in good shape. Wait until the warm weather arrives and you could have a situation on your hands similar to the A/C conundrum. Check them now so that if you need a fix or an adjustment, you can schedule it well in advance.

Manage air leaks

Did you check for leaks in the winter? You’re probably good to go, but, then again, it wouldn’t hurt to do another check. After all, leaks are quite literally sucking the air out of your home, and dollars are going with it.

“Taking the time to make sure your home is properly sealed and insulated will lower your total energy usage,” said Central Heating & Air Conditioning. “Similarly insulating your attic and walls, and sealing cracks and openings will prevent warm air from leaking into your home. When your home is sealed tightly, there is less chance of your cool air escaping. Your system will run less often, while keeping you just as cool and comfortable.”

According to Energy.gov, sealing a home up tight can provide a cost savings of between 10–20%.

Spring for a new fan

If you don’t have ceiling fans in key areas of your home, it might be time to add them. Fans can make the room feel more comfortable, so your air conditioning doesn’t have to work as hard, thus saving you money. If you’re staying away because you don’t like the way fans look, it might be time to take another glimpse, as more modern and streamlined options are readily available today, like this one from Home Depot.

Don’t ignore your fireplace

Once the temps have risen and your fireplace is off limits for the next couple seasons, don’t just walk away and pretend it doesn’t exist. If you haven’t closed the damper, you’re letting hot air into your home, which will make it much harder to keep cool.

Change out your window coverings

You can freshen up your space by opting for lighter materials that bring in the sunlight. “As warmer weather becomes the norm, and we crawl out of the darkened caves we’ve been hibernating in all winter, update windows to reflect the light, airy mood of the upcoming summer days,” said Quicken. “Change out thick, dark curtains with lighter fabrics to take advantage of the added daylight and brighten up the room.”

While you’re addressing your windows, take a look around to make sure you don’t have any unwanted friends hanging around. “Also, to ensure you keep the creepy crawlies out when you open up your home to let outside air in, do a thorough inspection of your window screens and look for any tears or holes requiring repair,” they said. “This is also a good time to rid the exterior of your windows of the grime and buildup of winter.”

Written by Jaymi Naciri

Source: https://realtytimes.com/consumeradvice/homeownersadvice/item/1016334-20180402-get-your-home-summer-ready-now-before-it-gets-scorching?rtmpage=

April 4, 2018   No Comments

Renovations To Think About Now If You Want A Holiday-Ready Home

Extended family descending on your house this year? Don’t panic. If you start now, you can have a holiday-ready home by the time Aunt Brenda and her brood shows up.

“We say it every year – the holidays will be here before we know it,” said Prime Lending. “For many people, that means hosting parties, welcoming overnight guests and opening your home to unexpected drop-in visitors. You may be thinking it would be great to spruce things up around your house before the holiday hustle and bustle begins. Now is a great time to dive into your home makeover and wrap it up before the holidays arrive.”

Here are the areas you might want to focus on first.

Get your kitchen looking cheftastic

Chances are, your kitchen is going to be one of the places where people are congregating during the holidays, and not just while cooking. If it’s seen better days, or if it just doesn’t reflect your style – or any style from this century – get started. You can select, order, and have new countertops installed in a matter of a few weeks. If you don’t want to touch the countertops, think about painting your cabinets and adding new hardware. A new backsplash can bring it all together, and is something you can do yourself.

Mary Evelyn

Replace or repair appliances

Thinking about the function of your kitchen – not just how you’ll use it over the holidays, but all year round – is key to making good choices when renovating. “If you are hosting Thanksgiving, a double oven and a new refrigerator may be your top priority,” said Prime Lending.

Maybe your dishwasher has seen better days or your washer and dryer have been hanging on for a while. Knowing that they’ll be put to good use with a house full of people might inspire you to make some upgrades now.

Consider the stuff you serve with and eat on, too

While you’re in the kitchen, you may want to think about upgrading your cookware, cooking utensils, glassware, silverware, and anything else that will be helping you prepare, serve, or eat food during the holidays. How old are those dishes, anyway?

Living room redo

If you have clunky built-ins or a large armoire housing your outdated TV, it might be time to make some changes. Turn the built-ins into bookcases or a sleek desk with some streamlined shelving above, which can provide both function and a fashionable upgrade. Turn a fireplace into a focal point by retiling or simply painting old brick white and hang a flat screen above. Voila. Your hangout space is updated and holiday-ready.

If you’re not super tech-savvy and have never installed a flat screen before, it’s smart to hire someone who is and who has. “If a new flat panel television, home theatre system, or other electronic devices are bound for your household this gift-giving season, consider seeking installation quotes from a trained professional,” said Better Homes and Gardens. “Proper installation can maximize your enjoyment of new electronics for a fraction of their purchase price, and the stress of following a multi-page instruction manual may bring out the Scrooge in many DIYers.”


Better Homes and Gardens
Add new bedding

You can make the guests rooms (or the guest couches, if your family converging on one house for the holidays looks anything like ours) hospitable and improve the look at the same time by changing out the bedding. Buying new sheets and a comforter is easy and inexpensive – and don’t forget new pillows, too. Choose a neutral color for the comforter and add some patterned pillow for some zip. Or, choose a graphic pattern to give the bed a modern feel. A fresh coat of paint in a color that is neutral and that gives the rooms a calming nature will help transform them into something that feels resort-like.

Address the back yard

If you live in a climate that allows outdoor enjoyment throughout the year – or if you know the kids will be playing outside regardless of the temperature – making some changes in your yard might be in order. The fall is a great time to buy patio furniture, since it’s typically on sale after summer ends. A firepit can be an inviting addition to your outdoor area, and one that will allow your guests to gather in front of a crackling fire while bundled up with a tasty, holiday beverage.

Update the guest bathrooms

One thing you can count on is that your guests will be spending time in the bathrooms. If yours are in need of some attention, now’s the time to pay some. If you don’t want to do a complete overhaul, you can make simple, inexpensive edits by changing out the showerhead, faucets, lighting, and slathering on a fresh coat of paint. A new paint color and some new hardware can also liven up older cabinets. Add a fresh set of towels and bath mats, and you’re all set.

Do a complete audit of everything else

Do a complete walkthrough of your house. Turn on all the baths, sinks, and showers, and all the lights and TVs. Sit on the beds, couches, and chairs. Open closets. Search the walls, doors, and baseboards for nicks and scratches. This will give you a head start on anything that needs to be fixed or replaced before family starts knocking on the door.

Written by Jaymi Naciri on Sunday, 09 October 2016

Source: http://realtytimes.com/consumeradvice/homeownersadvice1/item/47925-20161010-renovations-to-think-about-now-if-you-want-a-holiday-ready-home

October 12, 2016   No Comments

Top Reason to List Your House For Sale Now!

Top Reason to List Your House For Sale Now! | Keeping Current Matters

If you are debating listing your house for sale this year, here is the #1 reason not to wait!

Buyer Demand Continues to Outpace the Supply of Homes For Sale

The National Association of REALTORS’ (NAR) Chief Economist, Lawrence Yun recently commented on the inventory shortage:

“While feedback from REALTORS® continues to suggest healthy levels of buyer interest, available listings that are move-in ready and in affordable price ranges remain hard to come by for many would-be buyers.”

The latest Existing Home Sales Report shows that there is currently a 5.1-month supply of homes for sale. This remains lower than the 6-month supply necessary for a normal market and well below November 2014 numbers.

The chart below details the year-over-year inventory shortages experienced in 2015:

Housing Supply Year-Over-Year | Keeping Current Matters

Anything less than a six-month supply is considered a “Seller’s Market”.

Bottom Line

Meet with a local real estate professional who can show you the supply conditions in your neighborhood and assist you in gaining access to the buyers who are ready, willing and able to buy now!

Source:  http://www.keepingcurrentmatters.com/2016/01/04/top-reason-to-list-your-house-for-sale-now/

January 5, 2016   No Comments

What a Fed Rate Hike Could Mean to Mortgage Borrowers

December 14 at 7:00 AM

(Gene J. Puskar/AP)

This week’s expected rate increase by the Federal Reserve should not cause home buyers to panic, if history is any indication.

Back in the early 2000s, after the tech bubble burst, the Fed dropped its benchmark rate to 1 percent. Then in the summer of 2004, it began raising it by a quarter percent. At the time of the central bank’s first increase, the interest rate on a 30-year fixed-rate mortgage was around 6.3 percent. During the next four months, it dropped to 5.7 percent.

As the Fed continued to raise the benchmark rate, the rate on a 30-year fixed-rate mortgage declined, falling to 5.58 percent in June 2005. By the time of its last increase in the summer 2006, the rate on a 30-year fixed-rate mortgage was at 6.68 percent. It had gone up less than a half percent even though the benchmark rate had climbed from 1.25 percent to 5.25 percent.

Could mortgage rates follow the same course this time around? Possibly. But keep in mind the Fed hasn’t raised its benchmark rate in nearly a decade. It’s hard to predict how the market will react to such a momentous change.

“You’ve got 33-year-old bond traders who’ve never in their career seen” the Fed raise its benchmark rate, said Bob Walters, chief economist at Quicken Loans, the largest non-bank mortgage originator.

“You’ll clearly have some reaction in the market, even though [the rate increase is] expected. Just the reality of it plopping in their laps is going to create some volatility, not only in the bond markets but also the equity markets as people try to sort this out. People should expect prices of bonds and equities to start to gyrate.”

John Wake, a self-described “geek-in-chief” at Real Estate Decoded and a real estate agent in Arizona, believes that in 2004 when the Fed increased the benchmark rate it caused an already frenzied housing market to become more manic. Home buyers, worried that rising rates would prevent them for affording a house, became desperate to buy right away.

“The real estate economy is more sensitive to interest rates than most of the economy,” Wake said. “An interest rate low enough to move the needle on the national economy may cause the real estate economy to overheat. We may have seen a bit of that the last couple of years. And because real estate is more sensitive to interest rates, expectations of higher rates have a bigger impact on real estate than most of the economy.”

Wake points out that often what people expect determines what they do. If home buyers expect mortgage rates to increase, they will act as if rates are increasing even if they don’t.

“That could get people to buy sooner rather than later, which could drive prices up even more next year, which is what I am worried about,” he said.

Walters doubts a slight mortgage rate increase will have much impact on the housing market.

“I don’t think most people are going to run out and make a life decision for a quarter of a point interest rate,” he said.

As the chart from the Federal Reserve Bank of St. Louis shows, a very loose connection exists between the benchmark rate and a 30-year fixed-rate mortgage. Mortgage rates are more closely linked to 10-year U.S. Treasury yields, and bonds tend to move ahead of, rather than after, central bank decisions. As a general rule, when 10-year Treasury yields go up, mortgage rates go up. According to Freddie Mac’s national survey of lenders, the 30-year fixed-rate average was 3.95 percent last week. It has remained below 4 percent since late July.

“Long-term rates are determined by the marketplace every day, by traders buying and selling bonds,” Walters said. Traders are “thinking about the returns they are going to get over time. Primarily what they are thinking about, especially on longer term bonds, which a 30-year mortgage goes into, they’re thinking about inflation.”

Inflation has been hovering below the Fed’s 2 percent target. The U.S. economy has been doing fairly well lately, despite turmoil in the global economy, its effect on the dollar and low oil prices.

“You’re seeing a complete decimation of commodity prices right now,” Walters said. “That will influence inflation a great deal. It makes pricing power for wages almost impossible. And if you can’t get wage increases, it’s tough to have inflation. If you don’t have inflation, it’s tough to see rates go higher. That’s the world we’ve been in for [nearly] a decade. That’s not going away anytime soon. We’ve essentially been at zero percent short-term interest rates for seven or eight years. There’s not even a whisper of inflation. That’ll tell you really how challenging it is for price increases to take hold. And as long as that’s the case, long-term interest rates will stay down.”

No matter what the Fed does this week, it is likely that uncertainty in the global economy will continue to put downward pressure on long-term rates. The Mortgage Bankers Association is predicting the interest rate for 30-year fixed-rate mortgage will be around 4.8 percent at the end of 2016, that’s an increase of less than one percent.

“We have a fairly weak global economy right now,” said Michael Fratantoni, MBA’s chief economist. “You have many global investors parking their money in U.S. Treasury securities or other safe assets and that is keeping our longer term rates lower than they otherwise would be.”

What Fratantoni wonders about is what will happen after the Fed raises the benchmark rate, what its plan will be going forward.

“It really is not just when the Fed is going to make their first move,” he said. “It’s how that first move translates into market expectations about the future path of rates. It gets very complicated because it’s not just what they do, but how they talk about it and how investors anticipate how the Fed might act going forward.”

Fratantoni is especially curious about what the Fed will do with its balance sheet. The central bank pumped trillions of dollars in stimulus into the market in the wake of the financial crisis, buying mortgage-backed securities. Pre-crisis, the central bank’s balance sheet was about $800 billion, primarily in short-term Treasury bills. Now it’s $4.2 trillion, and the Fed is the largest single investor in mortgage-backed securities in the world, holding $1.7 trillion in MBS.

“The Fed has said at some point after they increase short-term rates they are going to begin to allow that portfolio to shrink, and they may more actively sell some of those securities,” Fratantoni said. There is “a lot of uncertainty about how the Fed is going to allow their balance sheet to wind down and when or if they might sell some of those MBS. There is not at this point a lot of clarity about who’s going to step in and try to dampen some of that volatility. There’s no investor of comparable size waiting on the sidelines ready to jump in.”

Despite those concerns, Fratantoni is optimistic about next year’s real estate market.

“At some point, you could get to a level of rates, 6 to 6½ percent, that would really begin to crimp affordability and then that would be a real negative,” he said. “But at this point, it’s going to be just a very modest headwind. Most of the other fundamentals are suggesting a very strong housing market in the year ahead.”

Waters agrees. Although he demurred when asked what he thought the interest rate on a 30-year fixed-rate mortgage would be at the end of the year, he didn’t think it would be significantly higher.

“I tend to think from a 30-year fixed mortgage standpoint there’s not going to be an extraordinary change,” he said. “I don’t think they’ll go up or down more than a quarter percent, at least not initially. It’s not going to five [percent] and it’s not going to three [percent]. We’re going to stay in a tight band.”

Source:  https://www.washingtonpost.com/news/where-we-live/wp/2015/12/14/what-a-fed-rate-hike-could-mean-to-mortgage-borrowers/

 

December 14, 2015   No Comments

Where Are Mortgage Rates Headed? This Winter? Next Year?

Where Are Mortgage Rates Headed? This Winter? Next Year? | Keeping Current Matters

The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be. That is why it is important to look at where rates are headed when deciding to buy now or wait until next year.

Below is a chart created using Freddie Mac’s October 2015 U.S. Economic & Housing Marketing Outlook. As you can see interest rates are projected to increase steadily over the course of the next 12 months.

Mortgage Rate Projections | Keeping Current Matters

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.4% from this time last year and are predicted to be 4.7% higher next year.

If both the predictions of home price and interest rate increases become reality, families would wind up paying considerably more for their next home.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth. Meet with a local real estate professional to evaluate your ability to purchase your dream home.

Source:  http://www.keepingcurrentmatters.com/2015/11/09/where-are-mortgage-rates-headed-this-winter-next-year/

November 24, 2015   No Comments

Fed Minutes Lay Out Plans for Rate Hikes

18 Nov 2015

by Craig Torres

Federal Reserve policy makers inserted language into their October statement to stress that “it may well become appropriate” to raise the benchmark lending rate in December and largely agreed that the pace of increases would be gradual, minutes of the meeting showed.

“Members emphasized that this change was intended to convey the sense that, while no decision had been made, it may well become appropriate to initiate the normalization process at the next meeting,” said minutes of the FOMC’s Oct. 27-28 meeting, released Wednesday in Washington.

A majority of Fed officials have signaled they expect to raise interest rates this year for the first time since 2006. That message was underscored when policy makers inserted a reference to the “next meeting” on Dec. 15-16 in their October statement, in connection with their assessment on when to act.

A “couple” of voting policy makers had qualms that the wording change “could be misinterpreted as signaling too strongly the expectation” for December liftoff, according to the report.

Participants in the meeting “generally agreed,” the minutes said, “that it would probably be appropriate to remove policy accommodation gradually.”

“It was noted that the beginning of the normalization process relatively soon would make it more likely that the policy trajectory after liftoff could be shallow,” the minutes said.

Three Camps

The minutes broke policy makers into three camps, with some saying economic conditions necessary for tightening policy “had already been met,” while “most participants” estimated that their criteria “could well be met” in December.

“Some others, however, judged it unlikely that the information available by the December meeting would warrant” a rate increase, the minutes said.

U.S. economic data since the meeting have been encouraging. Employers added 271,000 people to payrolls in October, the biggest gain this year, and unemployment fell to 5 percent. Job openings in September climbed to the second highest on record, while the consumer price index, minus food and energy, rose 1.9 percent last month from a year earlier.

Earlier Wednesday, several Fed officials talked up recent data on the U.S. economy and said it reinforced the case for raising interest rates, though they stopped short of committing to liftoff at their next meeting.

“I’m comfortable with moving off zero soon, conditioned on no marked deterioration in economic conditions,” Atlanta Fed President Dennis Lockhart told a conference in New York.

‘Live Possibility’

Chair Janet Yellen told Congress on Nov. 4 that a December rate hike was a “live possibility,” and New York Fed President William C. Dudley said Wednesday that raising rates would be a sign of confidence in the economy.

Officials in October also dropped a reference in their statement to “recent global economic and financial developments” potentially constraining economic growth.

“Most participants saw the downside risks arising from economic and financial developments abroad as having diminished,” the minutes said.

Despite missing their target for 2 percent annual inflation for more than three years, Fed officials continued to anticipate prices would rise back to their goal “over the medium term,” the minutes said.

Fed officials received a staff briefing on the equilibrium real interest rate, or the policy rate that would keep the economy running at full employment with stable prices, according to the minutes.

Fed officials discussed the possibility that the short-run equilibrium rate “would likely remain below levels that were normal during previous business cycle expansions,” the minutes said.

(Bloomberg)

November 18, 2015   No Comments

Are Today’s Home Prices in a Bubble?

17 Nov 2015

 

by Jeanna Smialek

An ongoing rebound in U.S. home prices is different from the credit-fueled run up that fanned the financial crisis and tipped the nation into recession when the real estate bubble burst, economists at the Federal Reserve Bank of San Francisco find in new research.

The distinction matters: San Francisco Fed President John Williams has recently warned that it’s important to monitor for asset price bubbles, saying that preventing imbalances from building is one argument in favor of raising interest rates off near-zero, where they have been held for seven years. Williams said in October that he was “starting to see signs of imbalances emerge in the form of high asset prices, especially in real estate,” and that once such issues grow large, they are difficult to tackle.

Williams noted then that the market isn’t yet at a “tipping point,” and the researchers uphold that conclusion. They find that today’s market lacks many of the riskiest characteristics that were evident in the run up to the late-2000’s housing collapse.

“The increase in U.S. house prices since 2011 differs in significant ways from the mid-2000s housing boom,” economists Reuven Glick, Kevin Lansing and Daniel Molitor find, noting a “less-pronounced increase in housing valuation together with an outright decline in household leverage — a pattern that is not suggestive of a credit-fueled bubble.”

Since bottoming out, the median house price has recovered to just 8 percent below the prior peak, according to the paper.

This time, however, the ratio of home prices to rent stands at about 25 percent below its mid-2000s high, the researchers find. The number is analogous to the price-to-dividend ratio for stocks and provides insight into whether price matches up with the fundamental value of the underlying asset.

“As house prices have recovered since 2011, so too has rent growth, providing some fundamental justification for the upward price movement,” the researchers write. What’s more, the mortgage debt-to-income ratio, which reached an all-time high in 2007, has continued to decline.

“The red flags are not evident in the current housing recovery,” they write. Even though this cycle is different, they say that “given that housing booms and busts can have significant and long-lasting effects on employment and other parts of the economy, policy makers and regulators must remain vigilant to prevent a replay of the mid-2000s experience.”

(Bloomberg)

November 18, 2015   No Comments

Mortgage Rates Pushed Upward Following Strong Employment Data

November 12 at 10:29 AM

Mortgage rates continued to move higher in anticipation of a Federal Reserve rate hike next month, according to the latest data released Thursday by Freddie Mac.

Home loan rates began creeping up after the Federal Reserve signaled earlier this month that a December interest rate hike was a possibility. What the Fed does with interest rates doesn’t have a direct relationship to mortgage rates, since they are more closely tied to long-term U.S. Treasury yields. Bonds are more likely to move ahead of a Fed action than in response to it.

With the release of last week’s stronger-than-expected jobs report, the possibility that the Fed will raise rates became greater and home loan rates experienced an upturn.

The 30-year fixed-rate average jumped to 3.98 percent with an average 0.6 point, creeping ever closer to the 4 percent mark. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.87 percent a week ago and 4.01 percent a year ago. Since falling to a six-month low of 3.76 percent in late October, the 30-year fixed rate has gained 22 basis points in two weeks. (A basis point is 0.01 percentage point.)

The 15-year fixed-rate average climbed to 3.2 percent with an average 0.6 point. It was 3.09 percent a week ago and 3.2 percent a year ago.

Hybrid adjustable rate mortgages also rose. The five-year ARM average grew to 3.03 percent with an average 0.4 point. It was 2.96 percent a week ago and 3.02 percent a year ago.

The one-year ARM average increased to 2.65 percent with an average 0.2 point. It was 2.62 percent a week ago.

“A surprisingly strong October jobs report showed 271,000 jobs added and wage growth of 0.4 percent from last month, exceeding many experts’ expectations,” Sean Becketti, Freddie Mac chief economist, said in a statement.

“The positive employment reports pushed Treasury yields to about 2.3 percent as investors responded by placing a higher likelihood on a December rate hike. Mortgage rates followed with the 30-year jumping 11 basis points to 3.98 percent, the highest since July. There is only one more employment report before the December FOMC meeting, which will have major implications on whether we see a rate hike in 2015.”

Meanwhile, mortgage applications were flat again this week, according to the latest data from the Mortgage Bankers Association.

The market composite index — a measure of total loan application volume – slipped 1.3 percent from the previous week. The refinance index dropped 2 percent, while the purchase index increased 0.1 percent.

The refinance share of mortgage activity accounted for 59.8 percent of all applications.

Source:  https://www.washingtonpost.com/news/where-we-live/wp/2015/11/12/mortgage-rates-pushed-upward-following-strong-employment-data/

November 12, 2015   No Comments

Waiting Until After the Holidays Isn’t a Smart Decision

Waiting until after the Holidays, Isn’t a Smart Decision | Keeping Current Matters

Every year at this time, many homeowners decide to wait until after the holidays to put their home on the market for the first time. Others who already have their home on the market decide to take it off the market until after the holidays. Here are six great reasons not to wait:

1. Relocation buyers are out there. Companies are not concerned with holiday time and if the buyers have kids, they want them to get into school after the holidays.

2. Purchasers that are looking for a home during the holidays are serious buyers and are ready to buy.

3. You can restrict the showings on your home to the times you want it shown. You will remain in control.

4. Homes show better when decorated for the holidays.

5. There is less competition for you as a seller right now. Let’s take a look at listing inventory as compared to the same time last year:

Supply of Homes | Keeping Current Matters

6. The supply of listings increases substantially after the holidays. Also, in many parts of the country, new construction will make a comeback in 2016. This will lessen the demand for your house.

Bottom Line

Waiting until after the holidays to sell your home probably doesn’t make sense.

Source:  http://www.keepingcurrentmatters.com/2015/11/05/waiting-until-after-the-holidays-isnt-a-smart-decision/

November 9, 2015   No Comments