Buying is Still a Smart Choice

Buying is Still a Smart Choice

by | Aug 28, 2023 | Buyers, Buying Conditions, Helpful Tips, Interest Rates, Investment Properties, Listings, Market Trends, Mortgage, Property Value, Real Estate, Schools, Security

The high interest rates are discouraging to us and we are not sure we want to purchase – any thoughts?

The decision to buy a house, whether a first home or a new home, is one of the most significant financial choices many individuals will make in their lives. While rising interest rates may seem like a deterrent, there are compelling reasons why the current real estate landscape still offers tremendous opportunities for potential homebuyers.

Real estate has proven to be a strong long-term investment. Even with higher interest rates, purchasing a home today can lead to substantial equity growth over the years. Real estate has a history of appreciating in value, and buying a home now positions buyers to benefit from potential future appreciation.  High rates are also holding some buyers back for the time being, which allows you an opportunity to buy with less competition.

While high interest rates can be a concern for those seeking mortgages, they also present an opportunity for buyers to secure a fixed-rate mortgage while rates are still relatively low by historic standards. A fixed-rate mortgage ensures stable monthly payments throughout the life of the loan, providing a sense of financial security and predictability that renting cannot.  While rates may feel comparatively high, economists and financial experts predict that interest rates may continue to rise in the coming years. By entering the market now, buyers have the opportunity to secure a home and a mortgage at what are still relatively lower rates before they increase further.  If they drop, you can refinance.  But how long do you want to sit on the fence and miss out on opportunities while you hope for a miracle (2.65% will probably end up as a once-in-a-lifetime that we all need to move past, unless you simply never want to move)?

Homeownership also offers a range of tax benefits, such as deductions for mortgage interest and property taxes. These advantages can help offset the impact of higher interest rates, making homeownership more affordable in the long run. While interest rates may be higher, lenders are still offering a variety of financing options to suit different budgets and preferences. Buyers can explore loan programs, down payment assistance, and other resources that can help mitigate the impact of higher interest rates.

In the face of rising interest rates, the decision to buy remains an attractive option for those seeking stability, investment opportunities, and a place to call home. While it’s essential to consider the financial implications of higher rates, the potential benefits of homeownership, including equity growth, tax advantages, and personal satisfaction, can outweigh the short-term impact of slightly increased mortgage rates. Working with a knowledgeable real estate agent and mortgage professional can help buyers navigate the current market and make informed decisions that align with their long-term goals.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Today’s Market is Not A Repeat

Today’s Market is Not A Repeat

by | Jul 16, 2023 | Buyers, Buying Conditions, Interest Rates, Investment Properties, Listings, Market Trends, Mortgage, Property Value, Real Estate, Sellers, Selling Conditions

Is the real estate market repeating 2008 all over again? 

Absolutely not!  I know there is a lot in the news about real estate these days, and the high interest rates and corresponding buyer anxiety are likely the most significant factor influencing what you may be perceiving to be a slow down in our market, but this is not a repeat of 2008! 

Currently, 39% of homeowners in the U.S. own their homes free and clear of all debt (a remarkable number) and another 29% have more than 50% equity in their homes.  That’s a full 68% of homes that are in very “safe” equity positions – the risk of any significant number of foreclosures is very low, unlike 2008.  

In 2008-2011, we had 11-12 months of inventory on the market at any given time.  Today, nationally, we have approximately 1.5 months of inventory on the market, with even less locally.  This is an incredibly important differentiator between then and now that indicates that we are not moving toward a housing crisis.  In 2008 in our area we had about 13000 properties – now that number is closer to 3000.

Additionally, approximately 3million US households earning over $150,000 per year are currently renting, and the average-aged millennials are just starting to buy their first homes.  This provides a steady stream or prospective buyers.  All of these factors indicate that we are not slipping into a housing crisis – the higher interest rates have just paused some of the typical move-up, move-down, move-around buyers. 

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Sounds Too Good To Be True

Sounds Too Good To Be True

by | Dec 1, 2022 | Blog, Buyers, Buying Conditions, Contracts, Helpful Tips, Interest Rates, Market Trends, Mortgage, Property Value, Real Estate

WE WOULD LIKE TO BUY A NEW HOME SOON BUT INTEREST RATES SEEM VERY HIGH – WE SEE ADVERTISEMENTS FOR INTERNET LENDERS OFFERING WHAT SEEM TO BE BELOW MARKET RATES.  IS THIS TOO GOOD TO BE TRUE? 

If you were simply refinancing an existing mortgage debt, you MAY be ok choosing an internet lender.  You would just need to be very careful that, before you apply to refinance your loan, you receive from the lender a full disclosure of all the costs and not just the rates.  Often times I see lenders have exorbitantly high fees connected with low rates.  In a sense, you would be buying down your rate by paying high fees upfront.  You would want to be sure to compare them on the same day to a couple of local lenders and understand what you are paying to get the quoted rates.  The reason you must compare rates on a singular date is because rates go up and down continuously and a rate may seem lower simply because you called a particular lender on a date rates dropped.

Since you are buying a new home rather than refinancing, I do NOT recommend that you use an internet lender.  They do not tend to be familiar with area norms and that can cause you more headaches than you can imagine.  There is a long list of particularities to PA Agreements of Sale and the last thing you want to do is have your closing delayed (while your movers are standing at the curb) while you wait for your lender (who does not have a local presence that you can visit personally to address any issues) to sort things out.  As they are not familiar with our Agreements and processes, internet lenders may also impose requirements on you that are not requirements generally imposed by local lenders that may disadvantage you later.  Finally, internet lenders often do not understand that PA Agreements of Sale declare “time is of the essence” inside the contract – what that means to you is that if you miss your closing date because the lender isn’t ready to close, the seller does have the legal right to declare you in default, keep your hand money and sell the home to someone else.

When buying, why take a risk?  Rely on your trusted Realtor to help you find a local lender who offers the most competitively priced loan products and delivers exceptional customer service.  Realtors cannot accept referral fees from lenders, so you can be sure we are motivated only by knowing you will have an outstanding transaction.  Feel free to reach out to me for help finding you the best local lender to meet your financing needs!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Don’t Let the Interest Rates Stop You

Don’t Let the Interest Rates Stop You

by | Nov 4, 2022 | Buyers, Buying Conditions, Contracts, Helpful Tips, Interest Rates, Investment Properties, Listings, Market Trends, Mortgage, Property Value, Real Estate

Interest rates jumped up again. Is it time for us to just wait until spring and hope they start to come back down? 

If you are a buyer, the real estate market offers you a great opportunity right now! Don’t be fooled by the higher interest rates – this is an awesome market for you to buy in! Why? Because all of the people who you would have been competing with are afraid of the interest rates and sitting by the sidelines.  This allows you to have a competition – free opportunity to buy a home!  Just six months ago, buyers would have been overjoyed to have an opportunity to buy a home without competition, to have had an opportunity to have had an offer accepted on the first home they offered on instead of their seventh, to have been able to purchase a home at asking price rather than asking price plus 10 percent!  Do not miss this golden opportunity – there are some very nice homes available right now. You can refinance later with a convenient no cost refinance loan – get the house now! Once rates start to come back down, the buyers (who have all been sitting by the sidelines with you) will come racing back into the market, and bidding wars will be back. Make the smart move – buy now.

And as a side note, I do not feel we will see a “crash” in prices.  Inventory remains at record lows and those homes that are selling continue to increase in their sales prices to new record highs, despite the increasing rates.  This is not 2008 – I am not anticipating any “deals” to be had this spring – if anything the natural increase in the buyer pool we see every spring will boost prices because of the extreme lack of inventory.  Feel free to reach out to me and we can strategize on how you can take the most advantage of the current real estate market while you still can!

A home’s value is set by the market.  Value is always determined by what a buyer is willing to pay for your home.  Many factors come into play in setting that value.  Market value reflects quantitative factors such as:  # bedrooms, # bathrooms, # garages, placement of garages (attached or integral), lot configuration (large and functional back yard?  Cliff lot?), location of the home generally, age of roof, age of mechanicals.  Market value also reflects more qualitative items:  how updated is your home, and is it all new, or just refreshed?  What is the floorplan (open concept?) What are your wall colors?  There is always a range that value will land in, which we call the range of reasonable.  There is no ONE price at which a home will sell.  If there are many buyers seeking a home like yours, it will sell at the top of the range of reasonable.  If there are not, it will take longer to sell and may sell a bit lower in the range.  What the market does not consider in setting a value of a home is what you need from the home.  In 2008, many homeowners had used their homes as ATMs and withdrawn large sums of money for educations, vacations and cars.  When the market softened, there was not enough equity for them to be able to sell their homes and not be in a short sale situation. This fact, that a homeowner over-extended themselves on mortgages, is not the least bit relevant to market value.  The market is also not going to consider what you plan to do next.  If you plan to move to Los Angeles to be closer to family and are finding that the Pittsburgh market is not going to yield you enough to be able to buy in L.A., you will need to turn to other investments to make up any difference.

We are in a very robust market – your home is far more likely to garner more now – whatever that may be – than it could have in the past.   Forecasters are also suggesting that values will soften by year end.  My crystal ball is out for service, but what I can tell you is that every hot market eventually softens.  Waiting out the market so that you can get a price that the market is unprepared to deliver at this time may have you waiting many, many years, and during that time you may need to invest even more in your home in order to deliver to the market what it needs in order to deliver an acceptable sale to you.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

The Value of a Deep Clean

The Value of a Deep Clean

by | Sep 13, 2022 | Blog, For Sale By Owner, Helpful Tips, Home Improvements, Home Staging, Listings, Market Trends, Marketing, Property Updates, Property Value, Real Estate, Sellers, Selling Conditions

Do we really have to have our home professionally deep cleaned before putting it on the market?

The short answer is yes, but here is why! When we live in our homes, we don’t see the dirt and the grime build up.  Even if you have your home cleaned every week, it is impossible for a weekly cleaning to keep up with the little things.  And when you want to sell your home, to achieve top dollar, it is important that your home sparkles at the highest possible level.  We are no longer in a market where buyers are happy to get any house.  We have moved back to a more traditional market and that means that sellers must take the time and incur the expense of a deep cleaning to make sure your home is squeaky clean and showing its very best.

Deep cleans are expensive and when done properly take many days of work.  It is unlikely that your weekly housekeeper (if you have one) is going to have the time to clean at this level.  Should you choose to take on the task yourself, you will soon see why deep cleans are costly and time consuming. So what is involved?  In every room of your home, every surface must be thoroughly cleaned.  Light switches and plugs should have all grime completely removed and restored to new, all vent covers (heating, ceiling fans, appliances) must be removed and washed (some may need to be repainted), all lighting fixtures must be carefully cleaned (including removing any glass bowls to clean inside) and should sparkle, all cabinets and drawers should be cleaned inside and out, windows should be washed inside and out including screens and tracks, carpets should be steam cleaned, shower grout needs to be cleaned, mineral build-up should be removed from shower/bath glass and all plumbing fixtures (try CLR and a scrub brush, or Stanley Steamer if the deposits wont budge), fireplaces need to be swept out and scrubbed down (if you burn wood in them, call a chimney sweep for a professional cleaning).  All wood work needs to be washed down or repainted as needed to look fresh.  Any smudging on walls needs to be cleaned or painted away.

Outside your home be sure that all doors are clean and fresh, that your porch/deck is clean (power wash if needed), that all lighting fixtures sparkle and that all patios and walkways are freshly power washed.

You may of course find it helpful to employ additional service providers, such as a power washer, carpet cleaner and window washer to get the job done right! It’s a big task cleaning up after years of enjoying a home, but it will absolutely pay dividends when you go to sell.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Waiving a Home Inspection

Waiving a Home Inspection

by | Mar 30, 2022 | Buyers, Buying Conditions, Contracts, Helpful Tips, Inspections, Listings, Market Trends, Property Updates, Property Value, Real Estate, Sellers

The market is so hot right now and we aren’t having any luck getting a home – should we waive home inspections? 

You are correct –the market under $1million is very fast paced right now, and in many instances, the winning bidder has waived home inspections.  That does seem to be what it may take to “win” right now but I cannot recommend that you make that choice.  Now several months into the “waive inspections” craze we are starting to hear stories about the expected fallout from this hasty decision.

From the seller’s perspective, I highly recommend that you have your home pre-inspected and repair or disclose the relevant items.  While an inspection might cost you upwards of $500, it is money well spent toward a smooth closing.  If you have pre-inspected your home and provide the report to prospective buyers, you are doing your part to make sure your buyer is well-informed.  In the absence of a pre-inspection, I do not recommend that you accept an offer from a buyer who has not inspected your home.  I have started hearing from home inspectors that disgruntled buyers are seeking post closing inspections to find problematic items and sue the sellers for failure to disclose. You don’t want that to be you. If you have not pre-inspected, we can discuss strategies to allow a buyer’s inspection and still protect you.

From a buyer’s perspective, as we all imagined would happen, the post-closing stories are starting to mount about buyers who purchased without an inspection and are now having all sorts of forseeable issues – roofs leaking, furnaces failing… If you are going to make this risky choice, you need to do so knowing that you will be assuming the risk of potentially tens of thousands of dollars of issues The contract specifically states that your inspection is your opportunity to find issues – if you waive that, you will be fighting an uphill battle to recover against anyone. Before you make an offer without an inspection contingency, you really do need to ask yourself if you are prepared to absorb those costs!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

The Effects of Rising Interest Rates

The Effects of Rising Interest Rates

by | Feb 10, 2022 | Blog, Buyers, Buying Conditions, Contracts, Investment Properties, Listings, Market Trends, Mortgage, Property Value, Real Estate

What impact do you think rising interest rates will have on the real estate market? 

I can’t tell you how many years the Fed has been warning us that they are going to raise the interest rates, and then nothing happened. But now, it looks like it is finally happening. Less than one year ago, conforming loans with good credit could be procured at rates below 3% fixed. Now they have inched up to 3.75% for conforming loans. While these are still historically great rates, the days of mortgage interest rates in the 3% range appear to be gone and we are slowly inching upward.

What impact will this have on the market? Typically, when rates increase the market slows. Buying power decreases – a buyer will qualify for a smaller mortgage amount when rates are higher. Even if a buyer qualifies for a loan amount, they may not want to pay the added amount each month attributable to the higher rate. Many buyers are cognizant of how much they don’t have available to spend on quality of life purchases, such as dinners out, when they have larger mortgage payments. This boils down to the fact that they may be unwilling or unable to buy at a price they could have last year, and this could depress housing prices.

However, this is counterbalanced by the fact that we are in a market with record low levels of inventory, so it is highly unlikely that interest rates will have any effect on housing prices in the short run. If anything, rising rates should cause buyers to move quickly and lock in homes and mortgages before rates continue to climb. And this would be the most sensible short-term response to rising rates. Buyers – rates are actually going up! The time to act is now!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe