![Prices Rose 7.1% Year-Over-Year [INFOGRAPHIC] | Simplifying The Market](http://d2d6tznlfad433.cloudfront.net/wp-content/uploads/2017/01/20170113-Prices-YOY-STM.jpg)
Source: KCM
It appears that Americans are regaining faith in the U.S. economy. The following indexes have each shown a dramatic jump in consumer confidence in their latest surveys:
It usually means good news for the housing market when the country sees an optimistic future. People begin to dream again about the home their family has always wanted, and some make plans to finally make that dream come true.
If you are considering moving up to your dream home, it may be better to do it earlier in the year than later. The two components of your monthly mortgage payment (home prices and interest rates) are both projected to increase as the year moves forward, and interest rates may increase rather dramatically. Here are some predictions on where rates will be by the end of the year:
“We think that conforming 30-year fixed rates probably make it into the 4.625 percent to 4.75 percent range at some point during 2017 as a peak.”
“I wouldn’t be surprised if the 30-year fixed mortgage rate hits 4.75 percent.”
“[I see] mortgage rates getting much closer to 5 percent at the end of next year.”
“By this time next year, expect the 30-year fixed rate to likely be in the 4.5 percent to 5 percent range.”
If you are feeling good about your family’s economic future and are considering making a move to your dream home, doing it sooner rather than later makes the most sense.
Source: KCM
According to data from the U.S Census bureau, there are approximately 76.4 million baby boomers living in the United States today. Contrary to what many think, there are very different segments within this generation, and one piece that sets them apart are their housing needs.
John McManus, editorial director of Hanley Wood’s Residential Group says his company “is focusing on the preferences of the younger half, or second-wave baby boomers, as they exhibit different needs than the older boomers.”
McManus says, “They are seeking a fun, dynamic lifestyle with a home that can also adjust to their changing needs in the future. Living space should either include accessibility features, such as doorway space, lower shelves, and nonslip surfaces, or be easily adjustable when the time comes.”
In a homebuyer study performed by The Farnsworth Group, the participants revealed their reasons for purchasing a new home. The top three factors that influence their purchase include area/location (50.2%), price/affordability (37.4%), and the layout of the home (19%) (as shown in the graph below).
The report also found that when buying a new home, there were other concerns like quality of construction (9%), a safer neighborhood (8.4%), better floor plans (8.25%). The most important rooms or areas are the kitchen (82.8%), master bedroom (59.2%), and great room (36%).
Technology also plays an important role! Second-wave baby boomers prefer wireless security systems (7.1%), lighting that senses and adapts to them (6.3%) and integrated home technology, including “smart” thermostats and lighting controlled by a smartphone (6.2%).
Grey Matter Research and Consulting points to a sense of community as a major factor in wanting to purchase:
“The first impressions are important when entering a new community, as is feeling welcome in the community. Amenities such as clubhouses, pools, and walking trails featured prominently in the decision to purchase in a community. Location was key, as residents want their new homes to be near shopping, dining, medical services and entertainment.”
If you are one of the many ‘second-wave’ baby boomers who is starting to feel like their current homes no longer fit their needs, take advantage of the low inventory of existing homes in today’s market by selling your current home and moving on to one that truly fits your new lifestyle.
Source: KCM
Many people wonder whether they should hire a real estate professional to assist them in buying their dream home or if they should first try to do it on their own. In today’s market: you need an experienced professional!
The field of real estate is loaded with land mines; you need a true expert to guide you through the dangerous pitfalls that currently exist. Finding a home that is priced appropriately and is ready for you to move into can be tricky. An agent listens to your wants and needs, and can sift through the homes that do not fit within the parameters of your “dream home.”
A great agent will also have relationships with mortgage professionals and other experts that you will need in securing your dream home.
In today’s market, hiring a talented negotiator could save you thousands, perhaps tens of thousands of dollars. Each step of the way – from the original offer to the possible renegotiation of that offer after a home inspection, to the possible cancellation of the deal based on a troubled appraisal – you need someone who can keep the deal together until it closes.
Realize that when an agent is negotiating their commission with you, they are negotiating their own salary; the salary that keeps a roof over their family’s head; the salary that puts food on their family’s table. If they are quick to take less when negotiating for themselves and their families, what makes you think they will not act the same way when negotiating for you and your family?
If they were Clark Kent when negotiating with you, they will not turn into Superman when negotiating with the buyer or seller in your deal.
Famous sayings become famous because they are true. You get what you pay for. Just like a good accountant or a good attorney, a good agent will save you money…not cost you money.
Source: KCM
The residential housing market has been hot. Home sales have bounced back solidly and are now at their second highest pace since February 2007. Demand has remained strong throughout the winter as many real estate professionals are reporting bidding wars with many homes selling above listing price. What about your house?
If your home is on the market and you are not receiving any offers, look at your price. Pricing your home just 10% above market value dramatically cuts the number of prospective buyers that will even see your house. See chart below.
The housing market is hot. If you are not seeing the results you want, sit down with your agent and revisit the pricing conversation.
Source: KCM
![3 Tips for Making Your Dream of Buying a Home Come True [INFOGRAPHIC] | Simplifying The Market](http://www.simplifyingthemarket.com/wp-content/uploads/2017/01/3-Tips-STM.jpg)
Source: KCM
Last week, CNBC ran an article quoting self-made millionaire David Bach explaining that not purchasing a home is “the single biggest mistake millennials are making” because buying real estate is “an escalator to wealth.”
Bach went on to explain:
“If millennials don’t buy a home, their chances of actually having any wealth in this country are little to none. The average homeowner to this day is 38 times wealthier than a renter.”
In his bestselling book, “The Automatic Millionaire,” Bach does the math:
“As a renter, you can easily spend half a million dollars or more on rent over the years ($1,500 a month for 30 years comes to $540,000), and in the end wind up just where you started — owning nothing. Or you can buy a house and spend the same amount paying down a mortgage, and in the end wind up owning your own home free and clear!”
Bach is a self-made millionaire who has written nine consecutive New York Times bestsellers. His book, “The Automatic Millionaire,” spent 31 weeks on the New York Times bestseller list. He is one of the only business authors in history to have four books simultaneously on the New York Times, Wall Street Journal, BusinessWeek and USA Today bestseller lists.
He has been a contributor to NBC’s Today Show appearing more than 100 times, has been a regular on ABC, CBS, Fox, CNBC, CNN, Yahoo, The View, and PBS, and has been profiled in many major publications, including The New York Times, BusinessWeek, USA Today, People, Reader’s Digest, Time, Financial Times, The Washington Post, The Wall Street Journal, Working Woman, Glamour, Family Circle, Redbook, Huffington Post, Business Insider, Investors’ Business Daily, and Forbes.
Whenever a well-respected millionaire gives investment advice, people usually clamor to hear it. This millionaire gave simple advice – if you don’t yet live in your own home, go buy one.
Source: KCM
The National Association of Realtors’ most recent Existing Home Sales Report revealed that, compared to last year, home sales are up dramatically in five of the six price ranges they measure.
Homes priced between $100-250K showed a 20.7% increase year-over-year. This is an impressive increase, showing that November was an excellent month for home sales in this price range.
But surprisingly, the 20.7% increase in sales in this range was not the highest percent change achieved, as sales of homes over $250,000 increased by double-digit percentages with sales in the $750,000- $1 million range showing the largest increase, up 43.2%!
As prices in many markets continue to accelerate, it is no surprise to see the percentage of homes in the higher price ranges increasing.
Homes under $100,000 were the only group to show negative appreciation of sales at -2.4%. This not only points to the lower inventory of homes available for sale in this price range but also speaks to the overall strength of the housing market.
Houses are definitely selling. If your house has been on the market for any length of time and has not yet sold, perhaps it is time to sit down with your agent to see if it is priced appropriately to compete in today’s market.
Source: KCM
The latest Existing Home Sales Report from the National Association of Realtors (NAR) revealed a direct correlation between a lack of inventory and rising prices.
We are all familiar with the concept of supply and demand. As the demand for an item increases the supply of that same item goes down, driving prices up.
Year-over-year inventory levels have dropped each of the last 18 months, as inventory now stands at a 4.0-month supply, well below the 6.0-month supply needed for a ‘normal’ market.
The median price of homes sold in November (the latest data available) was $234,900, up 6.8% from last year and marking the 57th consecutive month with year-over-year gains.
NAR’s Chief Economist, Lawrence Yun had this to say:
“Existing housing supply at the beginning of the year was inadequate and is now even worse heading into 2017. Rental units are also seeing this shortage. As a result, both home prices and rents continue to far outstrip incomes in much of the country.”
But there is good news about rising prices. More and more homeowners are recovering from a negative equity situation and learning that they are able to sell their homes and either move up to their dream home or downsize to a property that will better suit their needs. Look for these homes to come to market soon.
Buyer demand continues to outpace the supply of homes for sale. Listing your home in the winter attracts serious buyers who are looking to close the transaction quickly.
Source: KCM
Source: KCM