Albuquerque Real Estate BlogRecently posted or modified blog postshttps://www.missyashcraft.com/blog/Copyright MissyAshcraft.com2024-03-12T11:19:05-07:00tag:missyashcraft.com,2012-09-20:36411What Mortgage Rate Do You Need To Move?What Mortgage Rate Do You Need To Move?
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If you’ve been thinking about <a href="https://www.simplifyingthemarket.com/en/2024/02/20/strategic-tips-for-buying-your-first-home/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">buying a home</a>, mortgage rates are probably top of mind for you. They may even be why you’ve put your plans on hold for now. When <a href="https://www.simplifyingthemarket.com/en/2024/02/12/whats-really-happening-with-mortgage-rates/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">rates</a> climbed <a href="https://www.freddiemac.com/pmms/archive" rel="noopener noreferrer" target="_blank">near 8%</a> last year, some buyers found <a href="https://www.simplifyingthemarket.com/en/2024/02/23/how-changing-mortgage-rates-impact-you-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">the numbers</a> just didn’t make sense for their <a href="https://www.simplifyingthemarket.com/en/2024/01/18/3-key-factors-affecting-home-affordability/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">budget</a> anymore. That may be the case for you too.
<a href="https://brightmls.com/article/market-survey-winds-of-change-expected-for-2024" rel="noopener noreferrer" target="_blank">Data</a> from Bright MLS shows the top reason buyers delayed their plans to move is due to high mortgage rates (see graph below):
<a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240304/20240312-Top-3-Reasons-Buyers-Paused-Decision.png" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240304/20240312-Top-3-Reasons-Buyers-Paused-Decision.png" alt="a graph of blue rectangles with text" /></a>
David Childers, CEO at Keeping Current Matters, speaks to this statistic in the recent <a href="https://www.youtube.com/watch?v=wD0su_jp9lk" rel="noopener noreferrer" target="_blank">How’s The Market</a> podcast:
“Three quarters of buyers said ‘we’re out’ due to mortgage rates. Here’s what I know going forward. That will change in 2024.”
That’s because <a href="https://www.simplifyingthemarket.com/en/2024/01/30/2-of-the-factors-that-impact-mortgage-rates/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">mortgage rates</a> have come down off their peak last October. And while there’s still day-to-day volatility in rates, the longer-term projections show rates should continue to drop this year, as long as inflation gets under control. Experts even say we could see rates <a href="https://www.simplifyingthemarket.com/en/2024/02/21/some-experts-say-mortgage-rates-may-fall-below-6-later-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">below 6%</a> by the end of 2024. And that threshold would be a gamechanger for a lot of buyers. As a recent article from Realtor.com <a href="https://mediaroom.realtor.com/2024-02-21-Americans-Hold-on-to-the-Dream-of-Homeownership" rel="noopener noreferrer" target="_blank">says</a>:
“Buying a home is still desired and sought after, but many people are looking for mortgage rates to come down in order to achieve it. Four out of 10 Americans looking to buy a home in the next 12 months would consider it possible if rates drop below 6%.”
While mortgage rates are nearly impossible to forecast, the optimism from the experts should give you insight into what’s ahead. If your plans were delayed, there’s light at the end of the tunnel again. That means it may be time to start thinking about your move. The best question you can ask yourself right now, is this:
What number do I want to see rates hit before I’m ready to move?
The exact <a href="https://www.simplifyingthemarket.com/en/2024/01/08/what-lower-mortgage-rates-mean-for-your-purchasing-power/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">percentage</a> where you feel comfortable kicking off your search again is personal. Maybe it’s 6.5%. Maybe it’s 6.25%. Or maybe it’s once they drop below 6%.
Once you have that number in mind, here’s what you do. Connect with a local <a href="https://www.simplifyingthemarket.com/en/2024/02/28/why-you-want-an-agents-advice-for-your-move/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">real estate professional</a>. They’ll help you stay informed on what’s happening. And when rates hit your target, they’ll be the first to let you know.
Bottom Line
If you’ve put your plans to move on hold because of where mortgage rates are, think about the number you want to see rates hit that would make you ready to re-enter the market.
Once you have that number in mind, let’s connect so you have someone on your side to let you know when we get there.2024-03-12T11:14:45-07:002024-03-12T11:19:05-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:27022What’s the Difference Between a Home Inspection and an Appraisal?What’s the Difference Between a Home Inspection and an Appraisal?
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If you’re planning to <a href="https://www.simplifyingthemarket.com/en/2023/04/06/trying-to-buy-a-home-hang-in-there/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">buy a home</a>, an inspection is an important step in the process. It assesses the condition of the home before you finalize the transaction. It’s also a different step in the process from an appraisal, which is a professional evaluation of the market value of the home you’d like to buy. In most cases, an appraisal is ordered by the lender to confirm or verify the value of the home prior to <a href="https://www.simplifyingthemarket.com/en/2023/04/03/how-changing-mortgage-rates-can-affect-you/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">lending</a> a buyer money for the purchase. Here’s the breakdown of each one and why they’re both important when buying a home.
Home Inspection
Here’s the key difference between an inspection and an appraisal. Bankrate <a href="https://www.bankrate.com/real-estate/home-appraisal-vs-inspection/" rel="noopener noreferrer" target="_blank">says</a>:
“In short, while an appraisal helps you understand a home’s value, inspections help you understand a home’s condition.”
The <a href="https://www.simplifyingthemarket.com/en/2023/04/14/home-inspections-for-sellers-what-you-need-to-know-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">home inspection</a> is a way to determine the current state, safety, and condition of the home before you finalize the sale. If anything is questionable in the inspection process – like the age of the roof, the state of the HVAC system, or just about anything else – you as a buyer have the option to discuss and negotiate any potential issues or repairs with the seller before the transaction is final. Your real estate agent is a key expert to help you through this part of the process.
Home Appraisal
The National Association of Realtors (NAR) <a href="https://www.nar.realtor/appraisal-valuation/residential-appraisal-process-for-home-buyers" rel="noopener noreferrer" target="_blank">explains</a>:
“A home purchase is typically the largest investment someone will make. Protect yourself by getting your investment appraised! An appraiser will observe the property, analyze the data, and report their findings to their client. For the typical home purchase transaction, the lender usually orders the appraisal to assist in the lender’s decision to provide funds for a mortgage.”
When you apply for a mortgage, an unbiased appraisal (which is required by the lender) is the best way to confirm the value of the home based on the sale price. Regardless of what you’re willing to pay for a house, if you’ll be using a mortgage to fund your purchase, the appraisal will help make sure the bank doesn’t loan you more than what the home is worth.
This is especially critical in today’s <a href="https://www.simplifyingthemarket.com/en/2023/03/30/were-in-a-sellers-market-what-does-that-mean/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">sellers’ market</a> where low inventory is driving an increase in bidding wars, which can push home prices upward. When sellers are in a strong position like this, they tend to believe they can set whatever price they want for their house under the assumption that competing buyers will be willing to pay more.
However, the lender will only allow the buyer to borrow based on the value of the home. This is what helps keep <a href="https://www.simplifyingthemarket.com/en/2023/04/17/think-twice-before-waiting-for-lower-home-prices/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" rel="noopener noreferrer" target="_blank">home prices</a> in check. If there’s ever any confusion or discrepancy between the appraisal and the sale price, your trusted real estate professional will help you navigate any additional negotiations in the buying process.
Bottom Line
The inspection and the appraisal are critical steps when buying a home, and you don’t need to manage them by yourself. Let’s connect today so you have the expert guidance you need to navigate the entire homebuying process.2023-04-27T10:08:07-07:002023-04-27T15:30:06-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:25413Here’s Why the Housing Market Isn’t Going To CrashHere’s Why the Housing Market Isn’t Going To Crash
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<a href="https://files.keepingcurrentmatters.com/content/images/20230316/20230317_Heres-Why-The-Housing-Market-Isnt-Going-To-Crash-MEM.jpg" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230316/20230317_Heres-Why-The-Housing-Market-Isnt-Going-To-Crash-MEM.jpg" /></a>2023-03-17T06:32:36-07:002023-03-17T06:36:51-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:25409What Buyer Activity Tells Us About the Housing Market
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Though the housing market is no longer experiencing the frenzy of a year ago, buyers are showing their interest in purchasing a home. According to <a href="https://realestate.usnews.com/real-estate/articles/when-will-the-housing-market-crash" rel="noopener noreferrer" target="_blank">U.S. News</a>:
“Housing markets have cooled slightly, but demand hasn’t disappeared, and in many places remains strong largely due to the shortage of homes on the market.”
That activity can be seen in the latest ShowingTime Showing Index, which is a measure of buyers actively touring available homes (see graph below):
<a href="https://files.keepingcurrentmatters.com/content/images/20230315/20230313-largest-jump-in-showings-for-any-january-on-record-MEM-1.png" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230315/20230313-largest-jump-in-showings-for-any-january-on-record-MEM-1.png" /></a>
The 62% <a href="https://www.showingtime.com/blog/january-2023-showing-index-results/" rel="noopener noreferrer" target="_blank">jump</a> in showings from December to January is one of the largest on record. There were also more showings in January than in any other month since last May. As you can see in the graph, it’s normal for showings to increase early in the year, but the jump this January was larger than usual, and a lot of that has to do with mortgage rates. Michael Lane, VP of Sales and Industry at ShowingTime+, <a href="https://www.showingtime.com/blog/january-2023-showing-index-results/" rel="noopener noreferrer" target="_blank">explains</a>:
“It’s typical to see a seasonal increase in home showings in January as buyers get ready for the spring market, but a larger increase than any January before after last year’s rapid cooldown is significant. Mortgage rate activity this spring will play a big role in sales activity, but January’s home showings are a positive sign that buyers are getting back out there . . .”
It's important to note that mortgage rates hovered in the low 6% range in January, which played a role in the high number of showings. What does this mean? When mortgage rates eased, buyer interest climbed. The jump in home showings early this year makes one thing clear – while rates may be volatile right now, there are interested buyers out there, and when <a href="https://www.missyashcraft.com/" rel="noopener noreferrer" target="_blank">mortgage rates</a> are favorable, they’re ready to make their move. 2023-03-16T15:46:18-07:002023-03-17T06:32:27-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24701The Importance of Pre-Approval2023-02-20T08:23:44-07:002023-02-20T08:39:59-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24657 The Spring Housing Market Could Be a Sweet Spot for Sellers
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<img src="https://assets.site-static.com/userfiles/745/image/The-Spring-Housing-Market-Could-Be-A-Sweet-Spot-For-Sellers-MEM.jpg" width="1300" height="3025" />Some Highlights
The <a href="https://www.mykcm.com/2023/02/08/number-of-homes-for-sale-up-from-last-year-but-below-pre-pandemic-years/" title="biggest challenge">biggest challenge</a> in the housing market is how few houses there are for sale compared to the number of people who want to buy.
The number of <a href="https://www.realtor.com/research/january-2023-data/" title="homes for sale" target="_blank" rel="noopener noreferrer">homes for sale</a> is up from last year but below pre-pandemic numbers, and that means we’re still in a sellers’ market.
The housing market needs more homes for sale to meet the demand of today’s buyers. If you’ve thought about <a href="https://www.mykcm.com/2023/02/06/the-top-reasons-for-selling-your-house/" title="selling">selling</a>, let’s connect today.
</article>
2023-02-17T08:33:25-07:002023-02-17T08:36:13-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24612Should You Consider Buying a Newly Built Home?Should You Consider Buying a Newly Built Home?
<img width="750" height="410" src="https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Should You Consider Buying a Newly Built Home? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM.jpg 750w, https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM-600x328.jpg 600w, https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re thinking about buying a home, you might be focusing on previously owned ones. But with so few houses for sale <a href="https://www.simplifyingthemarket.com/2023/02/09/why-todays-housing-market-isnt-headed-for-a-crash/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="today" target="_blank" rel="noopener noreferrer">today</a>, it makes sense to consider all your options, and that includes a home that’s newly built.
The Number of Newly Built Homes Is on the Rise
While there are more houses for sale right now than there were at this time last year, there’s still a historically low number of <a href="https://www.simplifyingthemarket.com/2023/02/08/number-of-homes-for-sale-up-from-last-year-but-below-pre-pandemic-years/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="homes available" target="_blank" rel="noopener noreferrer">homes available</a> on the market. One reason for that is years of underbuilding—meaning there haven’t been enough new homes built to keep up with demand.
<a href="https://files.mykcm.com/2023/02/14110907/single-family-housing-units-completed-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-107444" src="https://files.mykcm.com/2023/02/14110907/single-family-housing-units-completed-MEM.png" /></a>
The graph above shows how low the production of newly constructed homes has been over the <a href="https://www.census.gov/construction/nrc/data/series.html" title="past 14 years" target="_blank" rel="noopener noreferrer">past 14 years</a>. But it also shows another important trend: the number of new homes being built each year is on the rise. As Mark Fleming, Chief Economist at First American, <a href="https://blog.firstam.com/economics/why-housing-market-potential-increased-for-the-second-straight-month" title="shares" target="_blank" rel="noopener noreferrer">shares</a>, that’s good news for buyers:
“While existing-home inventory remains limited, the silver lining for home buyers is that new-home inventory is on the rise, and a new home at the right price is a pretty good substitute.”
Builder Incentives Can Provide a Boost
While there a growing number of new homes for sale, builders are slowing that pace until they sell more of their current inventory. According to Logan Mohtashami, Lead Analyst at <a href="https://www.housingwire.com/articles/homebuilders-still-need-lower-mortgage-rates/" title="HousingWire" target="_blank" rel="noopener noreferrer">HousingWire</a>:
“The builders have to work off the backlog of homes, but instead of 3%-4% mortgage rates, they’re dealing with 6% plus mortgage rates, which means they have to provide many incentives to make sure those homes sell.”
Many builders are now offering incentives to help buyers purchase these homes. Fleming also explains:
“The National Association of Home Builders reported that nearly two-thirds of builders were offering incentives, including mortgage rate buydowns, paying points for buyers and price reductions, which could entice potential home buyers.”
A builder who’s willing to pay to reduce your mortgage rate could be a game changer. Ksenia Potapov, Economist at First American, <a href="https://blog.firstam.com/economics/why-mortgage-rates-hold-the-key-to-improved-affordability-in-2023" title="puts it" target="_blank" rel="noopener noreferrer">puts it</a> this way:
“A one percentage-point decline in mortgage rates has the same impact on affordability as an 11 percent decline in house prices.”
Should You Buy a Brand-New Home?
The best way to decide what type of home to buy is to work with a trusted real estate professional who can help you weigh the pros and cons of each option. They know which homes are available in your local market, and which builders might be offering incentives that make sense for you.
Bottom Line
Even though there aren’t a lot of homes for sale today, new home inventory is on the rise, and many builders are offering incentives. Let’s connect so I can help you weigh the pros and cons of shopping for a new home versus an existing one.
2023-02-16T15:54:00-07:002023-02-15T15:55:56-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24610The Top Reasons for Selling Your HouseThe Top Reasons for Selling Your House
<img width="750" height="410" src="https://files.mykcm.com/2023/02/02171326/the-top-reasons-for-selling-your-house-kcm.jpg" class="attachment-entry size-entry wp-post-image" alt="The Top Reasons for Selling Your House | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/02/02171326/the-top-reasons-for-selling-your-house-kcm.jpg 750w, https://files.mykcm.com/2023/02/02171326/the-top-reasons-for-selling-your-house-kcm-600x328.jpg 600w, https://files.mykcm.com/2023/02/02171326/the-top-reasons-for-selling-your-house-kcm-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Many of today’s homeowners bought or refinanced their homes during the pandemic when mortgage rates were at history-making lows. Since rates doubled in 2022, some of those homeowners put their plans to move on hold, not wanting to lose the low mortgage rate they have on their current house. And while today’s rates have started coming down from last year’s peak, they’re still higher than they were a couple of years ago.
Today, <a href="https://blog.firstam.com/economics/why-housing-market-potential-increased-for-the-second-straight-month" title="93%" target="_blank" rel="noopener noreferrer">93%</a> of outstanding mortgages have a rate at or below 6%. That means a strong majority of homeowners with mortgages have a rate below what they’d get if they moved right now. But if you’re a homeowner in that position, remember that mortgage rates aren’t the only thing to consider when making a move. Your mortgage rate is important, but there are plenty of <a href="https://www.simplifyingthemarket.com/2023/01/12/is-it-time-to-sell-your-second-home/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="reasons" target="_blank" rel="noopener noreferrer">reasons</a> you may still need or want to move. <a href="https://www.realtrends.com/articles/15-predictions-to-help-you-plan-your-real-estate-business/?utm_campaign=Newsletter%20-%20RealTrends%20Daily%20Update&utm_medium=email&_hsmi=242803681&_hsenc=p2ANqtz--cgeSndq-bGP9pHDdzMaLYQzDYmTRBNTPj4HTxWlZvvqwyFWbY3LjDS8Un0xv50kKZdWj23iAj0m5-1VvPh2A9IFNzTwEjkv82QTcDm5ZDdRvaWE0&utm_content=242803681&utm_source=hs_email" title="RealTrends" target="_blank" rel="noopener noreferrer">RealTrends</a> explains:
“Sellers who don’t have to move won’t be moving. The most common sellers will be: Homeowners downsizing . . . people moving to get more space, [households] looking for better schools…etc.”
So, if you’re on the fence about selling your house, consider the other reasons homeowners are choosing to make a move. A recent report from the National Association of Realtors (NAR) <a href="https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers" title="breaks down" target="_blank" rel="noopener noreferrer">breaks down</a> why homeowners have decided to sell over the past year:
<a href="https://files.mykcm.com/2023/02/02171323/homeowners-top-reasons-to-sell-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-107234" src="https://files.mykcm.com/2023/02/02171323/homeowners-top-reasons-to-sell-MEM.png" alt="The Top Reasons for Selling Your House | MyKCM" width="600" height="450" /></a>
As the visual shows, the most commonly cited reasons for selling were the desire to move closer to loved ones, followed by moving due to retirement, and their neighborhood becoming less desirable. Additionally, the need for more space factored in, as did a change in household structure.
If you also find yourself wanting a change in location or needing space your current house just can’t provide, it may be time to sell.
What you want and need in a home can be reason enough to move. To find out what’s right for you, work with a trusted real estate professional who will offer <a href="https://www.simplifyingthemarket.com/2023/01/05/3-best-practices-for-selling-your-house-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="advice" target="_blank" rel="noopener noreferrer">advice</a> and expert guidance throughout the process. They’ll be able to lay out all your options – giving you what you need to make a confident decision.
Bottom Line
When deciding whether or not to move, you have a lot to <a href="https://www.simplifyingthemarket.com/2023/01/10/the-truth-about-negative-home-equity-headlines/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="consider" target="_blank" rel="noopener noreferrer">consider</a>. There are plenty of non-financial reasons to factor in. Let’s connect today to weigh the benefits of selling your house.
2023-02-15T15:02:13-07:002023-02-15T15:54:34-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24588What You Should Know About Closing CostsBefore you buy a home, it’s important to <a href="https://www.mykcm.com/2023/02/10/how-to-win-as-a-buyer-in-todays-housing-market-infographic/" title="plan ahead">plan ahead</a>. While most buyers consider how much they need to save for a <a href="https://www.mykcm.com/2023/02/03/you-may-not-need-as-much-as-you-think-for-your-down-payment-infographic/" title="down payment">down payment</a>, many are surprised by the closing costs they have to pay. To ensure you aren’t caught off guard when it’s time to close on your home, you need to understand what closing costs are and how much you should budget for.
What Are Closing Costs?
People are sometimes surprised by closing costs because they don’t know what they are. According to <a href="https://www.bankrate.com/mortgages/understanding-the-closing-process/#wh" title="Bankrate" target="_blank" rel="noopener noreferrer">Bankrate</a>:
“Closing costs are the fees and expenses you must pay before becoming the legal owner of a house, condo or townhome . . . Closing costs vary depending on the purchase price of the home and how it’s being financed . . .”
In other words, your closing costs are a collection of fees and payments involved with your transaction. According to <a href="https://myhome.freddiemac.com/buying/understanding-costs" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>, while they can vary by location and situation, closing costs typically include:
Government recording costs
Appraisal fees
Credit report fees
Lender origination fees
Title services
Tax service fees
Survey fees
Attorney fees
Underwriting Fees
How Much Will You Need To Budget for Closing Costs?
Understanding what closing costs include is important, but knowing what you’ll need to budget to cover them is critical, too. According to the Freddie Mac article mentioned above, the costs to close are typically between 2% and 5% of the total purchase price of your home. With that in mind, here’s how you can get an idea of what you’ll need to cover your closing costs.
Let’s say you find a home you want to purchase for the <a href="https://www.nar.realtor/research-and-statistics" title="median price" target="_blank" rel="noopener noreferrer">median price</a> of $366,900. Based on the 2-5% Freddie Mac estimate, your closing fees could be between roughly $7,500 and $18,500.
Keep in mind, if you’re in the market for a home above or below this price range, your closing costs will be higher or lower.
What’s the Best Way To Make Sure You’re Prepared at Closing Time?
Freddie Mac provides great advice for homebuyers, <a href="https://myhome.freddiemac.com/buying/understanding-costs" title="saying" target="_blank" rel="noopener noreferrer">saying</a>:
“As you start your homebuying journey, take the time to get a sense of all costs involved – from your down payment to closing costs.”
Work with a team of trusted real estate professionals to understand exactly how much you’ll need to <a href="https://www.mykcm.com/2023/01/19/pre-approval-in-2023-what-you-need-to-know/" title="budget">budget</a> for closing costs. An agent can help connect you with a lender, and together your expert team can answer any questions you might have.
Bottom Line
It’s important to plan for the fees and payments you’ll be responsible for at closing. Let’s connect so I can help you feel confident throughout the process.2023-02-14T16:33:26-07:002023-02-14T16:34:32-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24176 The 3 Factors That Affect Home AffordabilityThe 3 Factors That Affect Home Affordability
<img width="750" height="410" src="https://files.mykcm.com/2023/01/23111137/the-3-factors-that-affect-home-affordability-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="The 3 Factors That Affect Home Affordability | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/01/23111137/the-3-factors-that-affect-home-affordability-KCM.jpg 750w, https://files.mykcm.com/2023/01/23111137/the-3-factors-that-affect-home-affordability-KCM-600x328.jpg 600w, https://files.mykcm.com/2023/01/23111137/the-3-factors-that-affect-home-affordability-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’ve been following the housing market over the last couple of years, you’ve likely heard about growing affordability challenges. But according to <a href="https://www.simplifyingthemarket.com/2023/01/09/what-experts-are-saying-about-the-2023-housing-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="experts" target="_blank" rel="noopener noreferrer">experts</a>, the key factors that determine housing affordability are projected to improve this year. Selma Hepp, Executive, Deputy Chief Economist at CoreLogic, <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights-january-2023/" title="shares" target="_blank" rel="noopener noreferrer">shares</a>:
“. . . with slowly improving affordability and a more optimistic economic outlook than previously believed, the housing market could show resilience in 2023.”
The three measures used to establish home affordability are home prices, mortgage rates, and wages. Here’s a closer look at each one.
1. Mortgage Rates
<a href="https://www.simplifyingthemarket.com/2023/01/17/think-twice-before-waiting-for-3-mortgage-rates/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="Mortgage rates" target="_blank" rel="noopener noreferrer">Mortgage rates</a> shot up to over 7% last year, causing many <a href="https://www.simplifyingthemarket.com/2023/01/02/what-are-your-goals-in-the-housing-market-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="buyers" target="_blank" rel="noopener noreferrer">buyers</a> to put their plans on hold. But things are looking different today as rates are starting to come down. George Ratiu, Senior Economist at realtor.com, <a href="https://www.realtor.com/news/trends/mortgage-rates-are-sliding-could-they-fall-below-6-soon/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Let’s celebrate some good news. . . . mortgage rates are down. With inflation showing a tangible slowdown, I do expect mortgage rates to follow suit in the months ahead.”
Even a small change in rates can impact your purchasing power. Nadia Evangelou, Director of Forecasting for the National Association of Realtors (NAR), gives this <a href="https://www.nar.realtor/blogs/economists-outlook/instant-reaction-mortgage-rates-january-12-2023" title="context" target="_blank" rel="noopener noreferrer">context</a>:
“With a 6% rate instead of 7%, buyers pay about $2,700 less every year on their mortgage. As a result, owning a home becomes affordable to about 1.4 million more renters and 4.3 million more homeowners.”
If 7% rates paused your homebuying plans last year, this could be the <a href="https://www.simplifyingthemarket.com/2022/12/19/mortgage-rates-are-dropping-what-does-that-mean-for-you/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="opportunity" target="_blank" rel="noopener noreferrer">opportunity</a> you need to get back in the game. Be sure to work with a team of experts who know the latest on mortgage rates and can give you the best advice for the current market.
2. Home Prices
The second factor at play is home prices. Home prices have made headlines over the past few years because they skyrocketed during the pandemic. When discussing home prices in 2023, Lawrence Yun, Chief Economist at NAR, <a href="https://www.nar.realtor/magazine/real-estate-news/2023-real-estate-forecast-market-to-regain-normalcy" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.”
So, while prices will likely be flat this year in some markets, others could see small gains or slight declines. It all depends on your local area. For insight into what’s happening in your market and how prices are impacting affordability, reach out to a trusted real estate professional.
3. Wages
The final component in the affordability equation is wages. The graph below uses <a href="https://www.bls.gov/charts/usual-weekly-earnings/usual-weekly-earnings-over-time-total-men-women.htm#%E2%80%8B" title="data" target="_blank" rel="noopener noreferrer">data</a> from the Bureau of Labor Statistics (BLS) to show how wages have increased over time:
<a href="https://files.mykcm.com/2023/01/23134805/american-wage-growth-since-2000-MEM-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-107030" src="https://files.mykcm.com/2023/01/23134805/american-wage-growth-since-2000-MEM-1.png" alt="The 3 Factors That Affect Home Affordability | MyKCM" width="600" height="450" /></a>
When you think about affordability, remember the full picture includes more than just mortgage rates and prices. Wages need to be factored in as well. Because wages have been rising, many <a href="https://www.simplifyingthemarket.com/2023/01/04/avoid-the-rental-trap-in-2023/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="buyers" target="_blank" rel="noopener noreferrer">buyers</a> have renewed opportunity in the market.
While affordability hurdles are not completely going away this year, based on current trends and projections, 2023 should bring some sense of relief to homebuyers who have faced growing challenges. As Mike Fratantoni, Chief Economist at the Mortgage Bankers Association (MBA), <a href="https://finance.yahoo.com/news/real-estate-ceos-economists-other-113600300.html" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“Rates are expected to move lower for the year, and home price growth is expected to cool, both of which will help affordability challenges.”
Bottom Line
If you have questions, let’s connect. You’ll also want to make sure you have a trusted lender so you can explore your financing options. You may be closer to <a href="https://www.simplifyingthemarket.com/2022/12/26/financial-fundamentals-for-first-time-homebuyers/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="owning a home" target="_blank" rel="noopener noreferrer">owning a home</a> than you think.
2023-01-24T08:17:31-07:002023-01-24T08:18:35-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:24161 Want To Sell Your House? Price It Right.Want To Sell Your House? Price It Right.
<img width="750" height="410" src="https://files.mykcm.com/2023/01/20114953/want-to-sell-your-house-price-it-right-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Want To Sell Your House? Price It Right. | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/01/20114953/want-to-sell-your-house-price-it-right-KCM.jpg 750w, https://files.mykcm.com/2023/01/20114953/want-to-sell-your-house-price-it-right-KCM-600x328.jpg 600w, https://files.mykcm.com/2023/01/20114953/want-to-sell-your-house-price-it-right-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Last year, the housing market slowed down in response to higher mortgage rates, and that had an impact on home prices. If you’re thinking of <a href="https://www.simplifyingthemarket.com/2023/01/05/3-best-practices-for-selling-your-house-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="selling" target="_blank" rel="noopener noreferrer">selling</a> your house soon, that means you’ll want to adjust your expectations accordingly. As realtor.com <a href="https://www.realtor.com/advice/sell/home-selling-rules-youve-heard-lately-that-you-might-want-to-break/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“. . . some of the more prominent pandemic trends have changed, so sellers might wish to adjust accordingly to get the best deal possible.”
In a more moderate market, how you price your house will make a big difference to not only your bottom line, but to how quickly your house could sell. And the reality is, homes priced right are still selling in today’s market.
Why Pricing Your House Appropriately Matters
Especially today, your asking price sends a message to potential buyers.
If it’s priced too low, you may leave money on the table or discourage buyers who may see a lower-than-expected price tag and wonder if that means something is wrong with the home.
If it’s priced too high, you run the risk of deterring buyers. When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag by some buyers who will wonder what that means about the home.
To avoid either headache, price it right from the start. A <a href="https://www.simplifyingthemarket.com/2022/12/29/planning-to-sell-your-house-its-critical-to-hire-a-pro/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate professional" target="_blank" rel="noopener noreferrer">real estate professional</a> knows how to determine that ideal asking price. They balance the value of homes in your neighborhood, current market trends, buyer demand, the condition of your house, and more to find the right price. This helps lead to stronger offers and a greater likelihood your house will sell quickly.
The visual below helps summarize the impact your asking price can have:
<a href="https://files.mykcm.com/2023/01/20114949/price-it-right-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-106994" src="https://files.mykcm.com/2023/01/20114949/price-it-right-MEM.png" alt="Want To Sell Your House? Price It Right. | MyKCM" width="600" height="338" /></a>
Bottom Line
Homes that are priced at current market value are still selling. To make sure you price your house appropriately, maximize your sales potential, and minimize your hassle, let’s connect.
2023-01-23T10:19:53-07:002023-01-23T11:10:49-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:23796 Wondering How Much You Need To Save for a Down Payment?Wondering How Much You Need To Save for a Down Payment?
<img width="750" height="410" src="https://files.mykcm.com/2022/12/22134046/wondering-how-much-you-need-to-save-for-a-down-payment-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Wondering How Much You Need To Save for a Down Payment? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/12/22134046/wondering-how-much-you-need-to-save-for-a-down-payment-KCM.jpg 750w, https://files.mykcm.com/2022/12/22134046/wondering-how-much-you-need-to-save-for-a-down-payment-KCM-600x328.jpg 600w, https://files.mykcm.com/2022/12/22134046/wondering-how-much-you-need-to-save-for-a-down-payment-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re getting ready to buy your first home, you’re likely focused on saving up for everything that purchase involves. One cost that’s likely top of mind is your down payment. But don't let a common misconception about how much you need to save make the process harder than it could be.
Understand 20% Isn’t Always the Typical Down Payment
Freddie Mac <a href="https://myhome.freddiemac.com/buying/down-payments-and-pmi" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“. . . nearly a third of prospective homebuyers think they need a down payment of 20% or more to buy a home. This myth remains one of the largest perceived barriers to achieving homeownership.”
Unless specified by your loan type or lender, it’s typically not required to put 20% down. This means you could be closer to your homebuying dream than you realize. According to the <a href="https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers" title="National Association of Realtors" target="_blank" rel="noopener noreferrer">National Association of Realtors</a> (NAR), the median down payment hasn’t been over 20% since 2005. In fact, the median down payment today is only 14%. And it’s even lower for first-time homebuyers at just 6% (see graph below):
<a href="https://files.mykcm.com/2022/12/22134044/todays-median-down-payment-is-less-than-20-percent-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-106555" src="https://files.mykcm.com/2022/12/22134044/todays-median-down-payment-is-less-than-20-percent-MEM.png" alt="Wondering How Much You Need To Save for a Down Payment? | MyKCM" width="600" height="450" /></a>
Learn About Options That Can Help You Toward Your Goal
If saving for a down payment still feels like a challenge, know that there’s help available. A real estate professional and trusted lender can show you options that could help you get closer to your down payment goal. According to latest <a href="https://downpaymentresource.com/professional-resource/homebuyer-assistance-programs-proliferate-in-q3-as-median-u-s-down-payment-skyrockets/" title="Homeownership Program Index" target="_blank" rel="noopener noreferrer">Homeownership Program Index</a> from Down Payment Resource, there are over 2,000 homebuyer assistance programs in the U.S., and the majority are intended to help with down payments.
Plus there are even loan types, like <a href="https://www.hud.gov/buying/loans" title="FHA loans" target="_blank" rel="noopener noreferrer">FHA loans</a>, with down payments as low as 3.5%, as well as options like <a href="https://www.simplifyingthemarket.com/2022/11/10/va-loans-can-help-veterans-achieve-their-dream-of-homeownership/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="VA loans" target="_blank" rel="noopener noreferrer">VA loans</a> and USDA loans with no down payment requirements for qualified applicants.
To understand your options, be sure to do your homework. If you’re interested in learning more about down payment assistance programs, information is available through sites like <a href="http://www.downpaymentresource.com/" title="Down Payment Resource" target="_blank" rel="noopener noreferrer">Down Payment Resource</a>. Then, partner with a trusted lender to learn what you qualify for on your homebuying journey.
Bottom Line
Remember, a 20% down payment isn’t always required. If you want to purchase a home this year, let’s connect. You’ll also want to make sure you have a trusted lender so you can explore your down payment options.
2023-01-03T11:11:04-07:002023-01-03T11:13:09-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:23729 Applying For a Mortgage? Here’s What You Should Avoid Once You Do.<img width="750" height="410" src="https://files.mykcm.com/2022/12/20165229/applying-for-a-mortgage-heres-what-you-should-avoid-once-you-do-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Applying For a Mortgage? Here’s What You Should Avoid Once You Do. | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/12/20165229/applying-for-a-mortgage-heres-what-you-should-avoid-once-you-do-KCM.jpg 750w, https://files.mykcm.com/2022/12/20165229/applying-for-a-mortgage-heres-what-you-should-avoid-once-you-do-KCM-600x328.jpg 600w, https://files.mykcm.com/2022/12/20165229/applying-for-a-mortgage-heres-what-you-should-avoid-once-you-do-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
While it’s exciting to start thinking about <a href="https://www.simplifyingthemarket.com/2022/12/05/prioritizing-your-wants-and-needs-as-a-homebuyer-in-todays-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="moving in" target="_blank" rel="noopener noreferrer">moving in</a> and <a href="https://www.simplifyingthemarket.com/2022/11/25/home-sweet-home-the-emotional-benefits-of-homeownership-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="decorating" target="_blank" rel="noopener noreferrer">decorating</a> after you’ve <a href="https://www.simplifyingthemarket.com/2022/10/28/applying-for-a-mortgage-doesnt-have-to-be-scary-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="applied for your mortgage" target="_blank" rel="noopener noreferrer">applied for your mortgage</a>, there are some key things to keep in mind before you close. Here’s a list of things you may not realize you need to avoid after applying for your home loan.
Don’t Deposit Large Sums of Cash
Lenders need to source your money, and cash isn’t easily traceable. Before you deposit any amount of cash into your accounts, discuss the proper way to document your transactions with your loan officer.
Don’t Make Any Large Purchases
It’s not just home-related purchases that could disqualify you from your loan. Any large purchases can be red flags for lenders. People with new debt have higher debt-to-income ratios (how much debt you have compared to your monthly income). Since higher ratios make for riskier loans, borrowers may no longer qualify for their mortgage. Resist the temptation to make any large purchases, even for furniture or appliances.
Don’t Cosign Loans for Anyone
When you cosign for a loan, you’re making yourself accountable for that loan’s success and repayment. With that obligation comes higher debt-to-income ratios as well. Even if you promise you won’t be the one making the payments, your lender will have to count the payments against you.
Don’t Switch Bank Accounts
Lenders need to source and track your assets. That task is much easier when there’s consistency among your accounts. Before you transfer any money, speak with your loan officer.
Don’t Apply for New Credit
It doesn’t matter whether it’s a new credit card or a new car, when you have your credit report run by organizations in multiple financial channels (mortgage, credit card, auto, etc.), it will have an impact on your FICO® score. Lower credit scores can determine your interest rate and possibly even your eligibility for approval.
Don’t Close Any Accounts
Many buyers believe having less available credit makes them less risky and more likely to be approved. This isn’t true. A major component of your score is your length and depth of credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both of those aspects of your score.
Do Discuss Changes with Your Lender
Be upfront about any changes that occur or you’re expecting to occur when talking with your lender. Blips in income, assets or credit should be reviewed and executed in a way that ensures your home loan can still be approved. If your job or employment status has changed recently, share that with your lender as well. Ultimately, it’s best to fully disclose and discuss your intentions with your loan officer before you do anything financial in nature.
Bottom Line
You want your home purchase to go as smoothly as possible. Remember, before you make any large purchases, move your money around, or make major life changes, be sure to consult your lender – someone who’s qualified to explain how your financial decisions may impact your home loan.
2022-12-28T15:20:03-07:002022-12-28T15:21:01-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:23728 Confused About What’s Going on in the Housing Market? Lean on a Professional.Confused About What’s Going on in the Housing Market? Lean on a Professional.
<img width="750" height="410" src="https://files.mykcm.com/2022/12/20121440/confused-about-whats-going-on-in-the-housing-market-lean-on-a-professional-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Confused About What’s Going on in the Housing Market? Lean on a Professional. | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/12/20121440/confused-about-whats-going-on-in-the-housing-market-lean-on-a-professional-KCM.jpg 750w, https://files.mykcm.com/2022/12/20121440/confused-about-whats-going-on-in-the-housing-market-lean-on-a-professional-KCM-600x328.jpg 600w, https://files.mykcm.com/2022/12/20121440/confused-about-whats-going-on-in-the-housing-market-lean-on-a-professional-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re thinking about <a href="https://www.simplifyingthemarket.com/2022/11/23/what-buyers-need-to-know-about-the-inventory-of-homes-available-for-sale/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="buying" target="_blank" rel="noopener noreferrer">buying</a> or <a href="https://www.simplifyingthemarket.com/2022/12/12/what-every-seller-should-know-about-home-prices/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="selling" target="_blank" rel="noopener noreferrer">selling</a> a home, you probably want to know what’s really happening with home prices, mortgage rates, housing supply, and more. That’s not an easy task considering how sensationalized headlines are today. Jay Thompson, Real Estate Industry Consultant, <a href="https://www.realestatenews.com/2022/11/18/agents-decoded-making-sense-of-the-headlines" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.”
Unfortunately, when information in the media isn’t clear, it can generate a lot of fear and uncertainty in the market. As Jason Lewris, Cofounder and Chief Data Officer at Parcl, <a href="https://www.parcllabs.com/articles/q3-real-estate" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”
But it doesn’t have to be that way. Buying or selling a home is a big decision, and it should be one you feel confident making. To help you separate fact from fiction and get the answers you need, lean on a local <a href="https://www.simplifyingthemarket.com/2022/08/29/a-trusted-real-estate-advisor-provides-expert-advice/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate advisor" target="_blank" rel="noopener noreferrer">real estate advisor</a>.
A trusted expert is your best resource to understand what’s happening at the national and local levels. They’ll be able to debunk the headlines using data you can trust. And using their in-depth knowledge of the industry, they’ll provide context so you know how current trends compare to the normal ebbs and flows in the industry, historical data and more.
Then, to make sure you have the full picture, they’ll tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you’ll use all of that information to make the best possible decision for you.
After all, making a move is a potentially life-changing milestone. It should be something you feel ready for and excited about. And that’s where an agent comes in.
Bottom Line
If you have questions about the headlines or what’s happening in the housing market today, let’s connect so you have expert insights and advice on your side.
2022-12-28T15:08:30-07:002022-12-28T15:09:48-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:23476023 Housing Market Forecast 2022-12-16T12:01:29-07:002022-12-16T12:02:03-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:22756Applying for a Mortgage Doesn’t Have To Be Scary
<img width="1046" height="2514" src="https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-1046x2514.png" class="attachment-entry size-entry wp-post-image" alt="Applying for a Mortgage Doesn’t Have To Be Scary [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-1046x2514.png 1046w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-250x600.png 250w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-426x1024.png 426w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-768x1846.png 768w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-639x1536.png 639w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-852x2048.png 852w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM-100x240.png 100w, https://files.mykcm.com/2022/10/27090656/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" />
Some Highlights
Even with higher mortgage rates, the <a href="https://www.mykcm.com/2022/10/12/four-things-that-help-determine-your-mortgage-rate/" title="mortgage process">mortgage process</a> doesn’t need to be something you fear. Here are some steps to help as you set out to buy a home.
Know your <a href="https://myhome.freddiemac.com/buying/what-can-you-afford.html" title="credit score" target="_blank" rel="noopener noreferrer">credit score</a> and work to build strong credit. When you’re ready, <a href="https://myhome.freddiemac.com/buying/finding-your-team" title="lean on the pros" target="_blank" rel="noopener noreferrer">lean on the pros</a> and connect with a <a href="https://myhome.freddiemac.com/buying/finding-the-right-loan.html" title="lender" target="_blank" rel="noopener noreferrer">lender</a> so you can get <a href="https://www.mykcm.com/2022/10/24/pre-approval-is-a-critical-first-step-on-your-homebuying-journey/" title="pre-approved">pre-approved</a> and begin your <a href="https://www.mykcm.com/2022/10/17/the-emotional-and-non-financial-benefits-of-homeownership/" title="home search">home search</a>.
Any major life change can be scary, and buying a home is no different. Let’s connect so you have an advisor by your side to take fear out of the equation.
<img src="https://assets.site-static.com/userfiles/745/image/applying-for-a-mortgage-doesnt-have-to-be-scary-MEM_1.png" width="1300" height="3124" />2022-10-28T10:15:44-07:002022-10-28T10:54:55-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:227513 Graphs Showing Why Today’s Housing Market Isn’t Like 20083 Graphs Showing Why Today’s Housing Market Isn’t Like 2008
<img width="750" height="410" src="https://files.mykcm.com/2022/10/25110844/3-graphs-showing-why-todays-housing-market-isnt-like-2008-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="3 Graphs Showing Why Today’s Housing Market Isn’t Like 2008 | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/10/25110844/3-graphs-showing-why-todays-housing-market-isnt-like-2008-KCM.jpg 750w, https://files.mykcm.com/2022/10/25110844/3-graphs-showing-why-todays-housing-market-isnt-like-2008-KCM-600x328.jpg 600w, https://files.mykcm.com/2022/10/25110844/3-graphs-showing-why-todays-housing-market-isnt-like-2008-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
With all the headlines and talk in the media about the <a href="https://www.simplifyingthemarket.com/2022/09/14/is-the-real-estate-market-slowing-down-or-is-this-a-housing-bubble/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="shift" target="_blank" rel="noopener noreferrer">shift</a> in the housing market, you might be thinking this is a housing bubble. It’s only natural for those thoughts to creep in that make you think it could be a repeat of what took place in 2008. But the good news is, there’s concrete data to show why this is nothing like the last time.
There’s Still a Shortage of Homes on the Market Today, Not a Surplus
For historical context, there were too many homes for sale during the housing crisis (many of which were short sales and foreclosures), and that caused prices to fall dramatically. <a href="https://www.simplifyingthemarket.com/2022/10/18/the-latest-on-supply-and-demand-in-housing/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="Supply" target="_blank" rel="noopener noreferrer">Supply</a> has increased since the start of this year, but there’s still a shortage of inventory available overall, primarily due to almost 15 years of underbuilding homes.
The graph below uses <a href="https://www.nar.realtor/newsroom/existing-home-sales-decreased-1-5-in-september" title="data" target="_blank" rel="noopener noreferrer">data</a> from the National Association of Realtors (NAR) to show how the months’ supply of homes available now compares to the crash. Today, unsold inventory sits at just a 3.2-months’ supply at the current sales pace, which is significantly lower than the last time. There just isn’t enough inventory on the market for <a href="https://www.simplifyingthemarket.com/2022/10/20/whats-ahead-for-home-prices/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home prices" target="_blank" rel="noopener noreferrer">home prices</a> to come crashing down like they did last time, even though some overheated markets may experience slight declines.
<a href="https://files.mykcm.com/2022/10/25110841/supply-of-homes-is-nothing-like-last-time-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-105320" src="https://files.mykcm.com/2022/10/25110841/supply-of-homes-is-nothing-like-last-time-MEM.png" alt="3 Graphs Showing Why Today’s Housing Market Isn’t Like 2008 | MyKCM" width="600" height="450" /></a>
Mortgage Standards Were Much More Relaxed Back Then
During the lead-up to the housing crisis, it was much easier to get a home loan than it is today. Running up to 2006, banks were creating artificial demand by lowering <a href="https://www.simplifyingthemarket.com/2022/06/01/why-home-loans-today-arent-what-they-were-in-the-past/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="lending standards" target="_blank" rel="noopener noreferrer">lending standards</a> and making it easy for just about anyone to qualify for a home loan or refinance their current home.
Back then, lending institutions took on much greater risk in both the person and the mortgage products offered. That led to mass defaults, foreclosures, and falling prices. Today, things are different, and purchasers face much higher standards from mortgage companies.
The graph below uses Mortgage Credit Availability Index (MCAI) <a href="https://www.mba.org/news-and-research/newsroom/news/2022/10/11/mortgage-credit-availability-decreased-in-september" title="data" target="_blank" rel="noopener noreferrer">data</a> from the Mortgage Bankers Association (MBA) to help tell this story. In that index, the higher the number, the easier it is to get a mortgage. The lower the number, the harder it is. In the latest report, the index fell by 5.4%, indicating standards are tightening.
<a href="https://files.mykcm.com/2022/10/25110839/lending-standards-still-under-control-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-105319" src="https://files.mykcm.com/2022/10/25110839/lending-standards-still-under-control-MEM.png" alt="3 Graphs Showing Why Today’s Housing Market Isn’t Like 2008 | MyKCM" width="600" height="450" /></a>
This graph also shows just how different things are today compared to the spike in credit availability leading up to the crash. Tighter lending standards over the past 14 years have helped prevent a scenario that would lead to a wave of foreclosures like the last time.
The Foreclosure Volume Is Nothing Like It Was During the Crash
Another difference is the number of homeowners that were facing foreclosure after the housing bubble burst. Foreclosure activity has been lower since the crash, largely because buyers today are more qualified and less likely to default on their loans. The graph below uses <a href="https://www.attomdata.com/wp-content/uploads/2022/10/Foreclosure-Starts-Q322.jpg" title="data" target="_blank" rel="noopener noreferrer">data</a> from ATTOM Data Solutions to help paint the picture of how different things are this time:
<a href="https://files.mykcm.com/2022/10/25110845/foreclosure-starts-then-and-now-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-105322" src="https://files.mykcm.com/2022/10/25110845/foreclosure-starts-then-and-now-MEM.png" alt="3 Graphs Showing Why Today’s Housing Market Isn’t Like 2008 | MyKCM" width="600" height="450" /></a>
Not to mention, homeowners today have options they just didn’t have in the housing crisis when so many people owed more on their mortgages than their homes were worth. Today, many homeowners are <a href="https://www.simplifyingthemarket.com/2022/09/26/the-true-strength-of-homeowners-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity rich" target="_blank" rel="noopener noreferrer">equity rich</a>. That equity comes, in large part, from the way home prices have appreciated over time. <a href="https://www.corelogic.com/intelligence/homeowner-equity-insights/" title="According" target="_blank" rel="noopener noreferrer">According</a> to CoreLogic:
“The total average equity per borrower has now reached almost $300,000, the highest in the data series.”
Rick Sharga, Executive VP of Market Intelligence at ATTOM Data, <a href="https://www.attomdata.com/news/market-trends/foreclosures/attom-september-and-q3-2022-u-s-foreclosure-market-report/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> the impact this has:
“Very few of the properties entering the foreclosure process have reverted to the lender at the end of the foreclosure. . . . We believe that this may be an indication that borrowers are leveraging their equity and selling their homes rather than risking the loss of their equity in a foreclosure auction.”
This goes to show homeowners are in a completely different position this time. For those facing challenges today, many have the option to use <a href="https://www.simplifyingthemarket.com/2022/10/05/the-long-term-benefit-of-homeownership/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="their equity" target="_blank" rel="noopener noreferrer">their equity</a> to sell their house and avoid the foreclosure process.
Bottom Line
If you’re concerned we’re making the same mistakes that led to the housing crash, the graphs above should help alleviate your fears. Concrete data and expert insights clearly show why this is nothing like the last time.
2022-10-28T05:41:18-07:002022-10-28T05:43:44-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21975Is the Real Estate Market Slowing Down, or Is This a Housing Bubble?Is the Real Estate Market Slowing Down, or Is This a Housing Bubble?
<img width="750" height="410" src="https://files.mykcm.com/2022/09/13112611/20220914-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Is the Real Estate Market Slowing Down, or Is This a Housing Bubble? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/09/13112611/20220914-KCM-Share.jpg 750w, https://files.mykcm.com/2022/09/13112611/20220914-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/09/13112611/20220914-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The talk of a <a href="https://www.simplifyingthemarket.com/2022/08/02/3-graphs-to-show-this-isnt-a-housing-bubble/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="housing bubble" target="_blank" rel="noopener noreferrer">housing bubble</a> in the coming year seems to be at a fever pitch as rising mortgage rates continue to slow down an overheated real estate market. Over the past two years, home prices have appreciated at an unsustainable pace causing many to ask: are things just slowing down, or is a crash coming?
To answer this question, there are two things we want to understand. The first is the reality of the shift in today’s housing market. And the second is what experts are saying about home prices in the coming year.
The Reality of the Shift in Today’s Housing Market
The reality is we’re seeing an inflection point in housing supply and demand. According to <a href="https://news.move.com/2022-09-01-Realtor-com-R-August-Housing-Report-Days-on-Market-Grows-for-the-First-Time-in-Over-Two-Years" title="realtor.com" target="_blank" rel="noopener noreferrer">realtor.com</a>, active listings have increased more than 26% over last year, while showings from the latest ShowingTime <a href="https://www.showingtime.com/blog/july-2022-showing-index-results/" title="Showing Index" target="_blank" rel="noopener noreferrer">Showing Index</a> have decreased almost 17% from last year (see graph below). This is an inflection point for housing because, over the past two years, we’ve seen a massive amount of demand (showings) and not enough homes available for sale for the number of people that wanted to buy. That caused the market frenzy.
Today, supply and demand look very different, and the market is slowing down from the pace we’ve seen. This offers proof of the sudden slowdown so many people are feeling.
<a href="https://files.mykcm.com/2022/09/13113948/20220914-MEM-Eng-1-.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104659" src="https://files.mykcm.com/2022/09/13113948/20220914-MEM-Eng-1-.png" alt="Is the Real Estate Market Slowing Down, or Is This a Housing Bubble? | MyKCM" width="600" height="450" /></a>
What Experts Are Saying About Home Prices in the Coming Year
Right now, most experts are forecasting home price appreciation in 2023, but at a much slower pace than the last two years. The average of the six forecasters below is for national <a href="https://www.simplifyingthemarket.com/2022/08/30/whats-actually-happening-with-home-prices-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home prices" target="_blank" rel="noopener noreferrer">home prices</a> to appreciate by 2.5% in the coming year. Only one of the six is calling for home price depreciation.
<a href="https://files.mykcm.com/2022/09/13112608/20220914-MEM-Eng-2.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104656" src="https://files.mykcm.com/2022/09/13112608/20220914-MEM-Eng-2.png" alt="Is the Real Estate Market Slowing Down, or Is This a Housing Bubble? | MyKCM" width="600" height="450" /></a>
When we look at the shift taking place along with what experts are saying, we can conclude the national real estate market is slowing down but is <a href="https://www.simplifyingthemarket.com/2022/08/24/why-todays-housing-inventory-proves-the-market-isnt-headed-for-a-crash/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="not a bubble" target="_blank" rel="noopener noreferrer">not a bubble</a> getting ready to burst. This isn’t to say that a few overheated markets won’t experience home price depreciation, but there isn’t a case to be made for a national housing bubble.
Bottom Line
The real estate market is slowing down, and that’s causing many to fear we’re in a housing bubble. What we’ve experienced in the housing market over the past two years were historic levels of demand and constrained supply. That led to homes going up in value at a record pace. While some overheated markets may experience price depreciation in the short term, according to experts, the national real estate market will appreciate in the coming year.
2022-09-14T08:08:00-07:002022-09-14T08:09:44-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21966 Why It’s So Important To Hire a Pro<img src="https://assets.site-static.com/userfiles/745/image/20220909-MEM.png" width="1300" height="2255" />2022-09-13T13:57:00-07:002022-09-13T13:58:56-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21958Getting Your House Ready To Sell? Work with a Realtor for Expert AdviceGetting Your House Ready To Sell? Work with an Agent for Expert Advice
<img width="750" height="410" src="https://files.mykcm.com/2022/09/09102806/20220912-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Getting Your House Ready To Sell? Work with an Agent for Expert Advice | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/09/09102806/20220912-KCM-Share.jpg 750w, https://files.mykcm.com/2022/09/09102806/20220912-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/09/09102806/20220912-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
In a market that’s <a href="https://www.simplifyingthemarket.com/2022/08/23/what-sellers-need-to-know-in-todays-housing-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="shifting" target="_blank" rel="noopener noreferrer">shifting</a> as fast as it is today, many homeowners wonder what, if anything, needs to be renovated before they <a href="https://www.simplifyingthemarket.com/2022/08/09/selling-your-house-your-asking-price-matters-more-now-than-ever/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sell their house" target="_blank" rel="noopener noreferrer">sell their house</a>. That’s where a trusted real estate professional comes in. They can help you think through today’s market conditions and how they impact what you should – and shouldn’t – do before selling your house.
Here are some considerations a professional will guide you through.
What You Need To Know About Your Local Market
Since the supply of <a href="https://www.simplifyingthemarket.com/2022/08/25/why-you-may-want-to-start-your-home-search-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="homes for sale" target="_blank" rel="noopener noreferrer">homes for sale</a> has increased so much this year, today’s buyers have more options than they had last year. That may mean you’re not able to ignore some of those repairs or cosmetic updates you could have skipped in previous months. As a recent article from realtor.com <a href="https://www.realtor.com/advice/sell/how-home-sellers-can-prepare-for-a-recession-and-still-sell-their-home/" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“To stand out in the market, sellers should make their home attractive to buyers, which usually means some selective updates.”
The key word here is selective. Since it’s still a <a href="https://www.simplifyingthemarket.com/2022/08/04/why-its-still-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>, focusing on a few key areas may be enough to make your house stand out from other options. And since inventory is still low overall, it’s also possible buyers may be willing to handle the renovations themselves once they move in. It all depends on buyer demand and the available inventory in your local area. For advice on what’s happening in your market and what to do to make your house show well, lean on a professional.
Not All Renovation Projects Are Equal
In addition to making sure your house makes a good first impression, you’ll also want to consider the return on your investment (ROI) for any renovations. According to the <a href="https://cdn.nar.realtor/sites/default/files/documents/2022-remodeling-impact-report-04-19-2022.pdf" title="2022 Remodeling Impact Report" target="_blank" rel="noopener noreferrer">2022 Remodeling Impact Report</a> from the National Association of Realtors (NAR), here are the projects that could net you the best return when you sell your house (see visual below):
<a href="https://files.mykcm.com/2022/09/09102804/20220912-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104599" src="https://files.mykcm.com/2022/09/09102804/20220912-MEM-Eng-1.png" alt="Getting Your House Ready To Sell? Work with an Agent for Expert Advice | MyKCM" width="600" height="450" /></a>
Again, your real estate advisor is your best resource. When your agent comes to your house for a walk-thru and consultation, they’ll use their expertise to offer any insight into what you may need to repair, replace, or refinish. They also know what other sellers are doing before listing their homes and how buyers are reacting to those upgrades to help steer you in the right direction. As Dr. Jessica Lautz, Vice President of Demographics and Behavioral Insights for NAR, <a href="https://www.nar.realtor/blogs/economists-outlook/research-spotlight-2022-remodeling-impact-report" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“This year, the winner was hardwood flooring. Hardwood floor refinishing and putting in new wood flooring had the most significant value, . . .”
How To Draw Buyer Attention to the Upgrades You’ve Made
For any projects you’ve already completed or for those you plan to do before listing, make sure your <a href="https://www.simplifyingthemarket.com/2022/08/29/a-trusted-real-estate-advisor-provides-expert-advice/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate professional" target="_blank" rel="noopener noreferrer">real estate professional</a> knows. They’re not just an advisor to help you decide where to focus your efforts, they’re also skilled at highlighting any upgrades in your listing. That way, potential buyers know about the features that may help sell them on the house.
No matter what, contact a local real estate professional for expert advice on what work needs to be done and how to make it as appealing as possible to future buyers. Every home is different, so a conversation with your agent is mission-critical to make sure you make the right moves when selling this season.
Bottom Line
In today’s shifting market, it’s important to spend your time and money wisely when you’re getting ready to move. Let’s connect to find out where to focus your efforts before you sell.
2022-09-13T10:25:00-07:002022-09-13T10:26:28-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21957 Three Things Buyers Can Do in Today’s Housing MarketThree Things Buyers Can Do in Today’s Housing Market
<img width="750" height="410" src="https://files.mykcm.com/2022/09/12105825/20220913-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Three Things Buyers Can Do in Today’s Housing Market | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/09/12105825/20220913-KCM-Share.jpg 750w, https://files.mykcm.com/2022/09/12105825/20220913-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/09/12105825/20220913-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
It’s clear the 2022 housing market has been defined by rising <a href="https://www.simplifyingthemarket.com/2022/09/07/expert-forecasts-on-mortgage-rates/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="mortgage rates" target="_blank" rel="noopener noreferrer">mortgage rates</a>. With rates on the rise, it’s also become more costly to purchase a home. According to the <a href="https://www.nar.realtor/blogs/economists-outlook/housing-affordability-conditions-fade-as-mortgage-rates-push-monthly-payments-higher-in-june-2022" title="National Association of Realtors" target="_blank" rel="noopener noreferrer">National Association of Realtors</a> (NAR):
“Compared to one year ago, the monthly mortgage payment rose to $1,944 from $1,265, an increase of 53.7%.”
If you’re thinking of <a href="https://www.simplifyingthemarket.com/2022/08/31/buyers-you-may-face-less-competition-as-bidding-wars-ease/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="buying a home" target="_blank" rel="noopener noreferrer">buying a home</a> or have been trying to recently, that’s a big increase in a monthly mortgage payment – and it may be causing you to press pause on your plans. This jump is making homes less affordable, especially compared to the last two years when mortgage rates were at historic lows.
The good news is you can navigate today’s housing market and this rising rate environment with a few <a href="https://www.simplifyingthemarket.com/2022/08/22/3-tips-for-buying-a-home-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="simple tips" target="_blank" rel="noopener noreferrer">simple tips</a>. Here are three things you may want to consider to help make your <a href="https://www.simplifyingthemarket.com/2022/08/25/why-you-may-want-to-start-your-home-search-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="homeownership" target="_blank" rel="noopener noreferrer">homeownership</a> goals a reality.
1. Expand Your Search Area and Criteria
If you’ve been looking for a home in the city center or a specific area that’s starting to feel out of your price range, you may want to try looking a little further out in a location that could be more affordable. Expanding your search location or re-prioritizing the items on your wish list can open up opportunities you haven’t considered, and that could help you afford more of what you need (and want) in a home. As CNET <a href="https://www.cnet.com/personal-finance/mortgages/6-tips-for-buyers-in-competitive-real-estate-markets/" title="notes" target="_blank" rel="noopener noreferrer">notes</a>:
“Area growth is likely to keep pace with the market, which means that the outskirts of town might be hopping within five years. Consider stepping out of your ideal location by searching in the nearby cities. You may find better prices and more square footage.”
2. Explore Alternative Financing Options
Working with a trusted lender to learn about the different loan types and options is essential too. According to <a href="https://www.nerdwallet.com/article/mortgages/tips-for-first-time-home-buyers" title="Nerd Wallet" target="_blank" rel="noopener noreferrer">Nerd Wallet</a>:
“A variety of mortgages are available with varying down payment and eligibility requirements.”
Experts know how to point you in the right direction when it comes to exploring ways to find the best home loan for your situation. With rising mortgage rates making it more costly to finance a home today, there may be an ideal option out there your loan officer can introduce you to. This could make a home purchase more affordable and within your financial reach over the life of your loan.
3. Look for Grants, Gift Funds, and Down Payment Assistance
There are also many options available when it comes to securing the funding you need to purchase a home. One valuable resource to explore is <a href="https://downpaymentresource.com/" title="downpaymentresource.com" target="_blank" rel="noopener noreferrer">downpaymentresource.com</a>. Searching for specific down payment assistance options available in your local community could be a game changer when it comes to taking your first step toward homeownership. As <a href="https://www.nar.realtor/first-time-homebuyers/first-time-homebuyer-loans-grants" title="NAR" target="_blank" rel="noopener noreferrer">NAR</a> indicates:
“Many local governments and non-profit organizations offer down-payment assistance grants and loans, targeted to area borrowers and often with specific borrower requirements.”
Plus, there are programs and special benefits for individuals working in certain professions or with unique statuses, including teachers, doctors and nurses, and veterans.
Ultimately, that means there are many federal, state, and local programs available for you to explore. The best way to do that is to connect with a local <a href="https://www.simplifyingthemarket.com/2022/08/29/a-trusted-real-estate-advisor-provides-expert-advice/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate professional" target="_blank" rel="noopener noreferrer">real estate professional</a> and your lender to learn more about what’s available in your area.
Bottom Line
If you’ve been searching for a home and have found yourself stepping out of the process because you’re worried about rising costs, let’s connect. Having a team of local advisors on your side may be just what you need to guide your search in a new and more affordable direction.
2022-09-13T10:13:00-07:002022-09-13T10:15:09-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21799Why It's Still a Seller's MarketHere’s Why It’s Still a Sellers’ Market [INFOGRAPHIC]
<img width="1046" height="1874" src="https://files.mykcm.com/2022/09/01081742/20220902-MEM-1046x1874.png" class="attachment-entry size-entry wp-post-image" alt="Here's Why It's Still a Sellers' Market [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/09/01081742/20220902-MEM-1046x1874.png 1046w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-335x600.png 335w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-572x1024.png 572w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-768x1376.png 768w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-857x1536.png 857w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-1143x2048.png 1143w, https://files.mykcm.com/2022/09/01081742/20220902-MEM-100x179.png 100w, https://files.mykcm.com/2022/09/01081742/20220902-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
While buyer demand has moderated and <a href="https://www.nar.realtor/newsroom/existing-home-sales-retreated-5-9-in-july" title="housing supply" target="_blank" rel="noopener noreferrer">housing supply</a> has grown in recent months, it’s still a <a href="https://www.simplifyingthemarket.com/2022/08/04/why-its-still-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a> because inventory is low.
The <a href="https://cdn.nar.realtor/sites/default/files/documents/2022-07-realtors-confidence-index-08-18-2022.pdf" title="latest data" target="_blank" rel="noopener noreferrer">latest data</a> shows sellers continue to benefit from serious buyers and competitive offers. In July, the average home received 2.8 offers and 39% sold over the asking price.
You haven’t missed your <a href="https://www.simplifyingthemarket.com/2022/08/23/what-sellers-need-to-know-in-todays-housing-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="opportunity" target="_blank" rel="noopener noreferrer">opportunity</a> to sell. Let’s connect to start the process today.
2022-09-02T11:02:00-07:002022-09-02T11:04:38-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21781 What’s Actually Happening with Home Prices Today?What’s Actually Happening with Home Prices Today?
<img width="750" height="410" src="https://files.mykcm.com/2022/08/29125429/20220830-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What’s Actually Happening with Home Prices Today? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/08/29125429/20220830-KCM-Share.jpg 750w, https://files.mykcm.com/2022/08/29125429/20220830-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/08/29125429/20220830-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
One of the biggest questions people are asking right now is: what’s happening with home prices? There are headlines about ongoing price appreciation, but at the same time, some sellers are reducing the price of their homes. That can feel confusing and makes it more difficult to get a clear picture.
Part of the challenge is that it can be hard to understand what experts are saying when the words they use sound similar. Let’s break down the differences among those terms to help clarify what’s actually happening today.
Appreciation is when home prices increase.
Depreciation is when home prices decrease.
Deceleration is when home prices continue to appreciate, but at a slower or more moderate pace.
Experts agree that, nationally, what we’re seeing today is deceleration. That means home prices are appreciating, just not at the record-breaking pace they have over the past year. In 2021, <a href="https://www.corelogic.com/intelligence/corelogic-hpi-posted-record-year-over-year-growth-in-2021/" title="data" target="_blank" rel="noopener noreferrer">data</a> from CoreLogic tells us home prices appreciated by an average of 15% nationwide. And earlier this year, that appreciation was upward of 20%. This year, <a href="https://www.simplifyingthemarket.com/2022/08/11/what-does-the-rest-of-the-year-hold-for-home-prices/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="experts forecast" target="_blank" rel="noopener noreferrer">experts forecast</a> home prices will appreciate at a decelerated pace of around 10 to 11%, on average.
The graph below uses the <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights/" title="latest data" target="_blank" rel="noopener noreferrer">latest data</a> from CoreLogic to help tell the story of how home prices are decelerating, but not depreciating so far this year.
<a href="https://files.mykcm.com/2022/08/29125430/20220830-MEM-Eng.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104401" src="https://files.mykcm.com/2022/08/29125430/20220830-MEM-Eng.png" alt="What’s Actually Happening with Home Prices Today? | MyKCM" width="600" height="450" /></a>
As the green bars show, home prices appreciated between 19-20% year-over-year from January to March. But over the last few months, the pace of that appreciation has decelerated to 18%. This means price growth is still climbing compared to last year but at a slower rate.
As the Monthly Mortgage Monitor from Black Knight <a href="https://www.blackknightinc.com/black-knights-june-2022-mortgage-monitor/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Annual home price growth dropped by nearly two percentage points . . . – the greatest single-month slowdown on record since at least the early 1970s. . . While June’s slowdown was record-breaking, home price growth would need to decelerate at this pace for six more months to drive annual appreciation back to 5%, a rate more in line with long-run averages.”
Basically, this means, while moderating, home prices are still far above the norm, and we’d have to see a lot more deceleration to even fall in line with more typical rates of home price growth. That’s still not home price depreciation.
The big takeaway is home prices haven’t fallen or depreciated nationwide, they’re just decelerating or moderating. While some unique and overheated markets may see declines, nationally, home prices are forecast to appreciate. And when we look at the country as a whole, none of the experts <a href="https://www.simplifyingthemarket.com/2022/08/05/housing-market-forecast-for-the-rest-of-2022-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="project" target="_blank" rel="noopener noreferrer">project</a> home prices will net depreciate or fall. They’re all projecting ongoing appreciation.
Bottom Line
If you have questions about what’s happening with home prices in our local area, let’s connect.
2022-09-01T12:18:00-07:002022-09-01T12:19:14-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21780 What Would a Recession Mean for the Housing Market?<img src="https://assets.site-static.com/userfiles/745/image/20220826-MEM.png" width="1300" height="2691" />
<article id="post-104333" class="post-104333 post type-post status-publish format-standard has-post-thumbnail hentry category-buyers category-sellers category-housing-market-updates category-infographics">
Some Highlights
If you’re wondering what a <a href="https://www.mykcm.com/2022/08/16/what-would-a-recession-mean-for-the-housing-market/" title="potential recession">potential recession</a> could mean for the housing market, here’s what <a href="https://www.thebalance.com/the-history-of-recessions-in-the-united-states-3306011" title="history" target="_blank" rel="noopener noreferrer">history</a> tells us.
In four of the last six recessions, <a href="https://www.corelogic.com/intelligence/find-stories/corelogic-hpi-posted-record-year-over-year-growth-in-2021/" title="home prices" target="_blank" rel="noopener noreferrer">home prices</a> actually appreciated, only <a href="https://www.corelogic.com/blog/2019/03/housing-recessions-and-recoveries.aspx" title="falling" target="_blank" rel="noopener noreferrer">falling</a> during the early 90s and the housing crash in 2008. <a href="http://www.freddiemac.com/pmms/" title="Mortgage rates" target="_blank" rel="noopener noreferrer">Mortgage rates</a>, though, declined during each of the previous <a href="https://mtg-specialists.com/2022/05/11/recession-interest-rates-and-real-estate/" title="recessions" target="_blank" rel="noopener noreferrer">recessions</a>.
If you have questions about buying or selling a home in today’s market, let’s connect.
</article>
2022-09-01T12:15:00-07:002022-09-01T12:17:50-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21643 What Sellers Need To Know in Today’s Housing MarketWhat Sellers Need To Know in Today’s Housing Market
<img width="750" height="410" src="https://files.mykcm.com/2022/08/22152838/20220823-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What Sellers Need To Know in Today’s Housing Market | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/08/22152838/20220823-KCM-Share.jpg 750w, https://files.mykcm.com/2022/08/22152838/20220823-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/08/22152838/20220823-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re thinking about <a href="https://www.simplifyingthemarket.com/2022/07/18/wondering-where-youll-move-if-you-sell-your-house-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="selling your house" target="_blank" rel="noopener noreferrer">selling your house</a>, you may have heard about the housing market slowing down in recent months. While it’s still a sellers’ market, the peak frenzy the market saw over the past two years has cooled some. If you’re asking yourself if you’ve missed your chance to sell your house and make a move, the good news is you haven’t – motivated buyers are still out there. But you do need to price your house right for today’s market. Here’s why.
As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), <a href="https://www.nar.realtor/newsroom/existing-home-sales-slid-5-4-in-june" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“Homes priced right are selling very quickly, but homes priced too high are deterring prospective buyers.”
It’s true buyer demand has slowed over the past few months as higher mortgage rates made it more expensive to buy a home. The result is fewer <a href="https://www.simplifyingthemarket.com/2022/08/10/is-the-shifting-market-a-challenge-or-an-opportunity-for-homebuyers/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="bidding wars" target="_blank" rel="noopener noreferrer">bidding wars</a> and less competition among buyers (see visual below):
<a href="https://files.mykcm.com/2022/08/22152839/20220823-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104252" src="https://files.mykcm.com/2022/08/22152839/20220823-MEM-Eng-1.png" alt="What Sellers Need To Know in Today’s Housing Market | MyKCM" width="600" height="450" /></a>
But don’t forget – that’s compared to the severely overheated market we saw over the past two years. According to the latest <a href="https://cdn.nar.realtor/sites/default/files/documents/2022-07-realtors-confidence-index-08-18-2022.pdf" title="Confidence Index" target="_blank" rel="noopener noreferrer">Confidence Index</a> from NAR:
“. . . 39% of homes sold above list price, down from 51% a month ago and 50% a year ago.”
While this is a slower pace than even one month ago, serious buyers are still actively in the market, and they’re buying homes that are priced right. In fact, the Confidence Index also notes the average home is selling in just 14 days.
If you’re aiming to sell your house, be sure you’re working with your agent to price it for today’s housing market. As buyer demand softens, it’s important to understand this isn’t the same market as last year. It’s not even the same market as just a few months ago. But it is still a <a href="https://www.simplifyingthemarket.com/2022/08/04/why-its-still-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>.
If you’re ready to sell your house, seek the advice of a <a href="https://www.simplifyingthemarket.com/2022/07/28/a-real-estate-professional-helps-you-separate-fact-from-fiction/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate professional" target="_blank" rel="noopener noreferrer">real estate professional</a>. In some cases, you’ll need to adjust your expectations accordingly to meet the market where it is today. Selma Hepp, Interim Lead, Deputy Chief Economist at CoreLogic, <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights-august-2022/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> what’s happening and what it means when you sell:
“Signs of a broader slowdown in the housing market are evident, . . . This is in line with our previous expectations and given the notable cooling of buyer demand due to higher mortgage rates. . . . Nevertheless, buyers still remain interested, which is keeping the market competitive — particularly for attractive homes that are properly priced.”
Bottom Line
While the housing market has cooled from its overheated frenzy, it’s still a sellers’ market. Let’s connect so you understand what’s happening with buyer demand and home prices in our local area as you get ready to enter the market.
2022-08-23T09:18:00-07:002022-08-23T09:20:13-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21592What Would a Recession Mean for the Housing Market?What Would a Recession Mean for the Housing Market?
<img width="750" height="410" src="https://files.mykcm.com/2022/08/15125226/20220816-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What Would a Recession Mean for the Housing Market? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/08/15125226/20220816-KCM-Share.jpg 750w, https://files.mykcm.com/2022/08/15125226/20220816-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/08/15125226/20220816-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
According to a <a href="https://www.wsj.com/articles/economic-forecasting-survey-archive-11617814998" title="recent survey" target="_blank" rel="noopener noreferrer">recent survey</a> from the Wall Street Journal, the percentage of economists who believe we’ll see a recession in the next 12 months is growing. When surveyed in July 2021, only 12% of economists consulted thought there’d be a recession by now. But this July, when polled, 49% believe we will see a recession in the coming 12 months.
And as more recession talk fills the air, one concern many people have is: should I delay my homeownership plans if there’s a recession?
Here’s a look at historical data to show what happened in real estate during previous recessions to help prove why you shouldn’t be afraid of what a recession would mean for the housing market today.
A Recession Doesn’t Mean Falling Home Prices
To show that home prices don’t fall every time there’s a <a href="https://www.corelogic.com/blog/2019/03/housing-recessions-and-recoveries.aspx" title="recession" target="_blank" rel="noopener noreferrer">recession</a>, it helps to turn to <a href="https://www.thebalance.com/the-history-of-recessions-in-the-united-states-3306011" title="historical data" target="_blank" rel="noopener noreferrer">historical data</a>. As the graph below illustrates, looking at the recessions going all the way back to 1980, <a href="https://www.simplifyingthemarket.com/2022/08/11/what-does-the-rest-of-the-year-hold-for-home-prices/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home prices" target="_blank" rel="noopener noreferrer">home prices</a> appreciated in four of the last six recessions. So, historically, when the economy slows down, it doesn’t mean home values will fall.
<a href="https://files.mykcm.com/2022/08/15125227/20220816-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104033" src="https://files.mykcm.com/2022/08/15125227/20220816-MEM-Eng-1.png" alt="What Would a Recession Mean for the Housing Market? | MyKCM" width="600" height="450" /></a>
Most people remember the housing crisis in 2008 (the larger of the two red bars in the graph above) and think another recession would repeat what happened then. But this housing market <a href="https://www.simplifyingthemarket.com/2022/08/02/3-graphs-to-show-this-isnt-a-housing-bubble/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="isn’t about to crash" target="_blank" rel="noopener noreferrer">isn’t about to crash</a>. The <a href="https://www.simplifyingthemarket.com/2022/07/14/housing-experts-say-this-isnt-a-bubble/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="fundamentals" target="_blank" rel="noopener noreferrer">fundamentals</a> are very different today than they were in 2008. So, don’t assume we’re heading down the same path.
A Recession Means Falling Mortgage Rates
<a href="https://mtg-specialists.com/2022/05/11/recession-interest-rates-and-real-estate/" title="Research" target="_blank" rel="noopener noreferrer">Research</a> also helps paint the picture of how a recession could impact the cost of financing a home. As the chart below shows, historically, each time the economy slowed down, <a href="https://www.freddiemac.com/pmms/archive" title="mortgage rates" target="_blank" rel="noopener noreferrer">mortgage rates</a> decreased.
<a href="https://files.mykcm.com/2022/08/15125229/20220816-MEM-Eng-2.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104034" src="https://files.mykcm.com/2022/08/15125229/20220816-MEM-Eng-2.png" alt="What Would a Recession Mean for the Housing Market? | MyKCM" width="600" height="450" /></a>
Fortune <a href="https://fortune.com/2019/06/19/next-recession-assets-mortgage-rates/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> that mortgage rates typically fall during an economic slowdown:
“Over the past five recessions, mortgage rates have fallen an average of 1.8 percentage points from the peak seen during the recession to the trough. And in many cases, they continued to fall after the fact as it takes some time to turn things around even when the recession is technically over.”
And while history doesn’t always repeat itself, we can learn from and find comfort in the historical data.
Bottom Line
There’s no doubt everyone remembers what happened in the housing market in 2008. But you don’t need to fear the word recession if you’re planning to buy or sell a home. According to historical data, in most recessions, home price gains have stayed strong, and mortgage rates have declined.
If you’re thinking about buying or selling a home, let’s connect so you have expert advice on what’s happening in the housing market and what that means for your homeownership goals.
2022-08-20T07:49:00-07:002022-08-19T12:35:28-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21591Why a Home Inspection Is Important<img src="https://assets.site-static.com/userfiles/745/image/20220819-MEM.png" width="1300" height="2432" /><img src="https://assets.site-static.com/userfiles/745/image/kcm-infographic-1612210016.png" width="1300" height="2040" />2022-08-19T07:43:00-07:002022-08-19T07:45:54-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:21023 Expert Housing Market Forecasts for the Second Half of the YearExpert Housing Market Forecasts for the Second Half of the Year
<img width="750" height="410" src="https://files.mykcm.com/2022/07/08111814/20220712-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Expert Housing Market Forecasts for the Second Half of the Year | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/07/08111814/20220712-KCM-Share.jpg 750w, https://files.mykcm.com/2022/07/08111814/20220712-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/07/08111814/20220712-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The <a href="https://www.simplifyingthemarket.com/2022/06/14/is-the-housing-market-correcting/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="housing market" target="_blank" rel="noopener noreferrer">housing market</a> is at a turning point, and if you’re thinking of buying or selling a home, that may leave you wondering: is it still a good time to buy a home? Should I make a move this year? To help answer those questions, let’s turn to the experts for projections on what the second half of the year holds for residential real estate.
Where Mortgage Rates Will Go Depends on Inflation
While one of the big questions on all buyers’ minds is where will mortgage rates go in the months ahead, no one has a crystal ball to know exactly what’ll happen in the future. What <a href="https://www.simplifyingthemarket.com/2022/06/27/two-reasons-why-todays-housing-market-isnt-a-bubble/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="housing market" target="_blank" rel="noopener noreferrer">housing market</a> experts know for sure is that the record-low mortgage rates during the pandemic were an outlier, not the norm.
This year, rates have climbed <a href="https://www.freddiemac.com/pmms/archive" title="over 2%" target="_blank" rel="noopener noreferrer">over 2%</a> due to the Federal Reserve’s response to <a href="https://www.simplifyingthemarket.com/2022/06/23/homeownership-is-a-great-hedge-against-the-impact-of-rising-inflation/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="rising inflation" target="_blank" rel="noopener noreferrer">rising inflation</a>. If inflation continues to rise, it’s likely that mortgage rates will respond. Greg McBride, Chief Financial Analyst at Bankrate, <a href="https://www.marketwatch.com/picks/until-inflation-peaks-mortgage-rates-wont-either-we-asked-3-economists-and-real-estate-pros-will-mortgage-rates-climb-higher-this-summer-01655941487" title="explains" target="_blank" rel="noopener noreferrer">explains</a> it well:
“Until inflation peaks, mortgage rates won’t either. Without improvement on the inflation front, we don’t know where the interest rate ceiling will be.”
Whether you’re buying your <a href="https://www.simplifyingthemarket.com/2022/06/08/what-are-the-best-options-for-todays-first-time-homebuyers/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="first home" target="_blank" rel="noopener noreferrer">first home</a> or selling your current house to <a href="https://www.simplifyingthemarket.com/2022/06/07/why-the-growing-number-of-homes-for-sale-is-good-for-your-move-up/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="make a move" target="_blank" rel="noopener noreferrer">make a move</a>, today’s mortgage rate is an important factor to consider. When rates rise, they impact affordability and your purchasing power. That’s why it’s crucial to work with a team of professionals, so you have expert advice to help you make an informed decision about your best move.
The Supply of Homes for Sale Projected To Continue Increasing
This year, particularly this spring, the <a href="https://www.simplifyingthemarket.com/2022/06/28/a-key-opportunity-for-homebuyers/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="number of homes for sale" target="_blank" rel="noopener noreferrer">number of homes for sale</a> has grown. That’s partly due to more homeowners listing their houses, but also because higher mortgage rates have helped ease the intensity of buyer demand. Moderating buyer demand slows down the pace of home sales, which in turn helps <a href="https://www.simplifyingthemarket.com/2022/06/17/more-listings-are-coming-onto-the-market-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="inventory rise" target="_blank" rel="noopener noreferrer">inventory rise</a>.
Experts say that growth will continue. Recently, realtor.com updated their <a href="https://news.move.com/2022-06-13-Realtor-com-R-2022-Forecast-Update-Real-Estate-Gets-a-Refresh-from-the-Frenzy" title="2022 inventory forecast" target="_blank" rel="noopener noreferrer">2022 inventory forecast</a>. In the latest release, they increased their projections for inventory gains dramatically, going from a 0.3% increase at the beginning of the year to a 15.0% jump by the end of 2022 (see graph below):
<a href="https://files.mykcm.com/2022/07/08111808/20220712-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-103337" src="https://files.mykcm.com/2022/07/08111808/20220712-MEM-Eng-1.png" alt="Expert Housing Market Forecasts for the Second Half of the Year | MyKCM" width="600" height="450" /></a>
More homes to choose from is great news if you’re craving more options for your home search – just know that there isn’t a sudden surplus of inventory on the horizon. Housing supply is still low, so you’ll need to partner with an agent to stay on top of what’s available in your market and move fast when you find the one. It’s not going to be easy to find a home, but it certainly won’t be as difficult as it has been over the past two years.
Home Price Forecasts Call for Ongoing Appreciation
Due to the imbalance between the number of homes for sale and the number of buyers looking to make a purchase, the pandemic led to record-breaking increases in home prices. According to <a href="https://www.corelogic.com/intelligence/corelogic-hpi-posted-record-year-over-year-growth-in-2021/" title="CoreLogic" target="_blank" rel="noopener noreferrer">CoreLogic</a>, homes appreciated by 15% in 2021, and they’ve continued to rise this year.
Even though housing supply is increasing today, there are still more buyers than there are homes for sale, and that’s maintaining the upward pressure on <a href="https://www.simplifyingthemarket.com/2022/06/16/home-price-deceleration-doesnt-mean-home-price-depreciation/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home prices" target="_blank" rel="noopener noreferrer">home prices</a>. That’s why experts are not calling for prices to decline, rather they’re forecasting they’ll continue to climb, just at a more moderate pace this year. On average, homes are projected to appreciate by about 8.5% in 2022 (see graph below):
<a href="https://files.mykcm.com/2022/07/08111811/20220712-MEM-Eng-2.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-103338" src="https://files.mykcm.com/2022/07/08111811/20220712-MEM-Eng-2.png" alt="Expert Housing Market Forecasts for the Second Half of the Year | MyKCM" width="600" height="450" /></a>
Selma Hepp, Deputy Chief Economist at CoreLogic, <a href="https://www.bankrate.com/real-estate/housing-market-predictions/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> why the housing market will see deceleration, but not depreciation, in prices:
“The current home price growth rate is unsustainable, and higher mortgage rates coupled with more inventory will lead to slower home price growth but unlikely declines in home prices.”
For current homeowners looking to sell, know your home’s value isn’t projected to fall, but waiting to make your purchase does mean your next home could cost more as home prices continue to appreciate. That’s why, if you’re thinking about buying your first home or you’re ready to make a move, it may make sense to do so now before prices climb higher. But rest assured, once you buy a home, that price appreciation will help grow the value of your <a href="https://www.simplifyingthemarket.com/2022/06/13/more-americans-choose-real-estate-as-the-best-investment-than-ever-before/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="investment" target="_blank" rel="noopener noreferrer">investment</a>.
Bottom Line
Whether you’re a homebuyer or seller, you need to know what’s happening in the housing market, so you can make the most informed decision possible. Let’s connect to discuss your goals and what lies ahead, so you can determine the best plan for your move.
2022-07-12T07:06:00-07:002022-07-12T07:08:02-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:19629 Do You Know How Much Equity You Have in Your Home?Do You Know How Much Equity You Have in Your Home? [INFOGRAPHIC]
<img width="1046" height="2334" src="https://files.mykcm.com/2022/04/05162315/20220408-MEM-1046x2334.png" class="attachment-entry size-entry wp-post-image" alt="Do You Know How Much Equity You Have in Your Home? [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/04/05162315/20220408-MEM-1046x2334.png 1046w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-269x600.png 269w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-459x1024.png 459w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-768x1714.png 768w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-688x1536.png 688w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-918x2048.png 918w, https://files.mykcm.com/2022/04/05162315/20220408-MEM-100x223.png 100w, https://files.mykcm.com/2022/04/05162315/20220408-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
If you’re a homeowner, your <a href="https://www.simplifyingthemarket.com/2022/03/28/a-key-to-building-wealth-is-homeownership/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="net worth" target="_blank" rel="noopener noreferrer">net worth</a> has gotten a big boost. That’s because recent <a href="https://www.simplifyingthemarket.com/2022/03/03/are-home-prices-continuing-to-rise/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home price appreciation" target="_blank" rel="noopener noreferrer">home price appreciation</a> has increased your equity.
Your equity grows as you pay down your loan and as your home <a href="https://www.simplifyingthemarket.com/2022/03/14/this-spring-presents-sellers-with-a-golden-opportunity/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="increases" target="_blank" rel="noopener noreferrer">increases</a> in value. Over the past year, the average <a href="https://www.simplifyingthemarket.com/2022/03/21/the-average-homeowner-gained-more-than-55k-in-equity-over-the-past-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="homeowner’s equity" target="_blank" rel="noopener noreferrer">homeowner’s equity</a> grew by <a href="https://www.corelogic.com/intelligence/homeowner-equity-insights/" title="$55,300" target="_blank" rel="noopener noreferrer">$55,300</a>.
Ready to sell? Let’s connect to talk about how you can use that equity to fuel your next move.
2022-04-08T11:23:00-07:002022-04-08T11:25:30-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:19528 It’s Still a Sellers’ Market It’s Still a Sellers’ Market [INFOGRAPHIC]
<img width="1046" height="2173" src="https://files.mykcm.com/2022/04/31142157/20220401-MEM-1046x2173.png" class="attachment-entry size-entry wp-post-image" alt="It’s Still a Sellers’ Market [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/04/31142157/20220401-MEM-1046x2173.png 1046w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-289x600.png 289w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-493x1024.png 493w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-768x1596.png 768w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-739x1536.png 739w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-986x2048.png 986w, https://files.mykcm.com/2022/04/31142157/20220401-MEM-100x208.png 100w, https://files.mykcm.com/2022/04/31142157/20220401-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
Due to <a href="https://www.nar.realtor/newsroom/existing-home-sales-fade-7-2-in-February" title="low supply" target="_blank" rel="noopener noreferrer">low supply</a> and high demand, today is one of the strongest <a href="https://www.simplifyingthemarket.com/2022/03/14/this-spring-presents-sellers-with-a-golden-opportunity/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ markets">sellers’ markets</a> we’ve seen.
Sellers can benefit from <a href="https://cdn.nar.realtor/sites/default/files/documents/2022-02-realtors-confidence-index-03-18-2022.pdf" title="more offers" target="_blank" rel="noopener noreferrer">more offers</a> to pick from, <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights/" title="higher home values" target="_blank" rel="noopener noreferrer">higher home values</a>, and a faster sales process. There’s a reason why 72% of people believe it’s a <a href="https://www.fanniemae.com/media/43001/display" title="good time to sell" target="_blank" rel="noopener noreferrer">good time to sell</a>.
Don’t miss out on this unique opportunity. Let’s connect so you can take advantage of this hot sellers’ market.
2022-04-01T13:14:00-07:002022-04-01T13:15:36-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:19496What’s Happening with Mortgage Rates, and Where Will They Go from Here?What’s Happening with Mortgage Rates, and Where Will They Go from Here?
<img width="750" height="410" src="https://files.mykcm.com/2022/03/29163529/20220330-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What’s Happening with Mortgage Rates, and Where Will They Go from Here? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/03/29163529/20220330-KCM-Share.jpg 750w, https://files.mykcm.com/2022/03/29163529/20220330-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/03/29163529/20220330-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Based on the <a href="https://www.freddiemac.com/pmms/archive" title="Primary Mortgage Market Survey" target="_blank" rel="noopener noreferrer">Primary Mortgage Market Survey</a> from Freddie Mac, the average 30-year fixed-rate mortgage has increased by 1.2% (3.22% to 4.42%) since January of this year. The rate jumped by more than a quarter of a point from just a week ago. Here’s a visual to show how mortgage rate movement throughout 2021 was steady compared to the rapid increase in mortgage rates this year:
<a href="https://files.mykcm.com/2022/03/29163526/20220330-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-101659" src="https://files.mykcm.com/2022/03/29163526/20220330-MEM-Eng-1.png" alt="What’s Happening with Mortgage Rates, and Where Will They Go from Here? | MyKCM" width="600" height="450" /></a>
Just a few months ago, Freddie Mac <a href="https://www.freddiemac.com/research/forecast/20220121-quarterly-economic-forecast" title="projected" target="_blank" rel="noopener noreferrer">projected</a> mortgage rates would average 3.6% in 2022. Earlier this month, Fannie Mae <a href="https://www.fanniemae.com/media/43141/display" title="forecast" target="_blank" rel="noopener noreferrer">forecast</a> mortgage rates would average 3.8% in 2022. As the chart above shows, rates have already surpassed those projections.
Sam Khater, Chief Economist at Freddie Mac, explained in a <a href="https://freddiemac.gcs-web.com/news-releases/news-release-details/mortgage-rates-continue-move-0?_ga=2.217383318.1602794866.1648323840-1529566666.1576528603" title="press release" target="_blank" rel="noopener noreferrer">press release</a> last week:
“This week, the 30-year fixed-rate mortgage increased by more than a quarter of a percent as mortgage rates across all loan types continued to move up. Rising inflation, escalating geopolitical uncertainty and the Federal Reserve’s actions are driving rates higher and weakening consumers’ purchasing power.”
Where Are Mortgage Rates Going from Here?
In a <a href="https://www.bankrate.com/mortgages/march-2022-mortgage-rate-outlook/" title="recent article" target="_blank" rel="noopener noreferrer">recent article</a> by Bankrate, several industry experts weighed in on where rates might be headed going forward. Here are some of their forecasts:
Greg McBride, Chief Financial Analyst, Bankrate:
“With inflation figures continuing to surprise to the upside, mortgage rates will remain above 4.0% on the 30-year fixed.”
Nadia Evangelou, Senior Economist and Director of Forecasting, National Association of Realtors (NAR):
“While higher short-term interest rates will push up mortgage rates, I expect some of this impact to be mitigated eventually through lower inflation. Thus, I expect the 30-year fixed mortgage rate to continue to rise, although we aren’t likely to see the big jumps that occurred over the past few weeks.”
Len Kiefer, Deputy Chief Economist, Freddie Mac:
“Mortgage rates are likely to continue to move higher throughout the balance of 2022, although the pace of rate increases is likely to moderate.”
In a recent realtor.com <a href="https://www.realtor.com/research/federal-reserve-mar-2022-meeting/" title="article" target="_blank" rel="noopener noreferrer">article</a>, another expert adds to the conversation:
Danielle Hale, Chief Economist, realtor.com:
“. . . As markets digest the Fed’s updated economic projections, I anticipate a continued increase in mortgage rates over the next several months. . . .”
What Does This Mean for You if You’re Looking To Buy a Home?
With both mortgage rates and <a href="https://www.simplifyingthemarket.com/2022/03/03/are-home-prices-continuing-to-rise/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home values">home values</a> expected to increase throughout the year, it would be better to buy sooner rather than later if you’re able. That’s because it’ll cost you more the longer you wait. But, there is a possible silver lining to buying a home right now. While you’ll be paying a higher price and a higher mortgage rate than you would have last year, rising prices do have a long-term benefit once you buy.
If you purchase a home today valued at $400,000 and put 10% down, you would be taking out a $360,000 mortgage. According to <a href="https://www.mortgagecalculator.net/" title="mortgagecalculator.net" target="_blank" rel="noopener noreferrer">mortgagecalculator.net</a>, at a 4.42% fixed mortgage rate, your mortgage payment would be $1,807 a month (this does not include insurance, taxes, and other fees because those vary by location).
Now, let’s put that mortgage payment into a new perspective based on the substantial growth in <a href="https://www.simplifyingthemarket.com/2022/03/21/the-average-homeowner-gained-more-than-55k-in-equity-over-the-past-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity">equity</a> that comes with the escalation in home prices. Every quarter, Pulsenomics surveys a panel of over 100 economists, investment strategists, and housing market analysts about their expectations for future home prices in the United States. Last week, Pulsenomics released their latest <a href="https://pulsenomics.com/surveys/#home-price-expectations" title="Home Price Expectation Survey" target="_blank" rel="noopener noreferrer">Home Price Expectation Survey</a>. The survey reveals that the average of the experts’ forecasts calls for a 9% increase in home values in 2022.
Based on those projections, a $400,000 house you buy today could be valued at $436,000 by this time next year. If you break that down, that means the equity in your home would increase by $3,000 a month over that period. That’s greater than the estimated monthly payment above. Granted, the increase in your <a href="https://www.simplifyingthemarket.com/2022/03/28/a-key-to-building-wealth-is-homeownership/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="net worth">net worth</a> is tied to the home, but it is one way to put the home price appreciation to use in a way that benefits you.
Bottom Line
Paying a higher price for a home and a higher mortgage rate can be a difficult pill to swallow. However, waiting will just cost you more. If you’re ready, willing, and able to buy a home, now will be a better time than a year, or even six months from now. Let’s connect to begin the process today.
2022-03-31T10:11:00-07:002022-03-31T10:13:01-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:18363The Number #1 Reason to Sell Your House TodayThe #1 Reason To Sell Your House Today
<img width="750" height="410" src="https://files.mykcm.com/2022/02/23123145/20220224-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="The #1 Reason To Sell Your House Today | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/02/23123145/20220224-KCM-Share.jpg 750w, https://files.mykcm.com/2022/02/23123145/20220224-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/02/23123145/20220224-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Almost every industry is currently struggling with supply chain disruptions. This also applies to the current U.S. housing market, where buyer demand far exceeds housing supply.
Purchaser demand is very strong right now. The National Association of Realtors (NAR) just released their latest <a href="https://www.nar.realtor/newsroom/existing-home-sales-surge-6-7-in-january" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a> which reveals that sales surged in January. Existing home sales rose to a seasonally adjusted annual rate of 6.5 million – an increase of 6.7% from the prior month, with sales up in all regions. However, there’s one big challenge.
Inventory Is at an All-Time Low
Because purchaser demand is so high, the market is running out of available homes for sale. The above-mentioned report states that the current months’ supply of inventory of homes for sale has fallen to 1.6 months. This prompts Lawrence Yun, Chief Economist at NAR, to say:
“The inventory of homes on the market remains woefully depleted, and in fact is currently at an all-time low.”
Earlier this month, realtor.com released their <a href="https://www.realtor.com/research/data/" title="inventory data" target="_blank" rel="noopener noreferrer">inventory data</a> for January. It helps confirm this point. Here’s a graph comparing inventory levels for January over the last six years:
<a href="https://files.mykcm.com/2022/02/23123141/20220224-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-101263" src="https://files.mykcm.com/2022/02/23123141/20220224-MEM-Eng-1.png" alt="The #1 Reason To Sell Your House Today | MyKCM" width="600" height="450" /></a>
As the graph shows, new listings coming on the market have decreased over the last four years (shown in blue in the graph). The graph also reveals that carry-over inventory has plummeted in recent years. This is because listings are now sold so quickly, they don’t stay on the market long enough to carry over month-to-month (shown in green in the graph). In other words, homes are not staying on the market for months as they had prior to the pandemic. In the report mentioned above, NAR reveals that:
“Seventy-nine percent of homes sold in January 2022 were on the market for less than a month.”
Odeta Kushi, Deputy Chief Economist at First American, <a href="https://twitter.com/odetakushi/status/1494695509486936067" title="explains" target="_blank" rel="noopener noreferrer">explains</a> it like this:
“A higher velocity of sales (lower [Days on Market]) helps to explain a housing market characterized by both higher sales & lower inventory. Many resale transactions are happening so quickly that they ‘flow’ in & then out of the ‘stock’ between the fixed monthly measurement of inventory.”
What Does This Mean for Sellers?
Anyone thinking of putting their home on the market shouldn’t wait. A seller will always negotiate the best deal when demand is high and supply is limited. That’s exactly the situation in the real estate market today.
Later this year, inventory (and by extension, your competition) will increase as many homeowners are waiting to put their homes on the market in the spring and early summer.
In addition, Len Kiefer, Deputy Chief Economist at Freddie Mac, <a href="https://twitter.com/lenkiefer/status/1494423003224059914" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“Housing starts start off 2022 strong, just edging out 2021 for most in January since 2006.”
As these newly built homes are completed, they will also become competition for your house. This gives you a tremendous opportunity right now. Don’t wait for that increase in competition in your area. If you want to sell in 2022 and are ready to start the process, today is the day to list your house.
Bottom Line
If you’re ready to sell, let’s connect to get your house on the market while today’s inventory situation is in your favor.
2022-02-24T10:40:00-07:002022-02-24T10:41:44-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:17816Beyond Van Gogh Traveling Art Exhibit in AlbuquerqueWhat is Beyond Van Gogh?
Beyond Van Gogh is a new truly immersive experience. While other shows use virtual reality or still images, our show breaks barriers by incorporating both still and moving art. Masterpieces, now freed from frames, come alive, appear, and disappear, flow across multi-surfaces, the minutia of details titillating our heightened senses. The show is projected on every surface around you, this makes you feel as though you have stepped directly into a Van Gogh painting. We accompany the show with a beautiful score and include many other surprises!
Who created Beyond Van Gogh?
Created by French-Canadian creative director Mathieu St-Arnaud and his team at Montreal’s Normal Studio, Beyond Van Gogh is an immersive experience showcasing over 300 of the artist’s works.
Where can I find the music played during Beyond Van Gogh?
For a playlist of the music from Beyond Van Gogh, please see our Spotify playlist,<a href="https://open.spotify.com/playlist/0o9CxXVDyDHqZ33cNEhUp5"> Beyond Van Gogh: The Immersive Experience – Soundtrack</a>.
Will Beyond Van Gogh be coming to any other cities?
To see all the cities we are visiting, please visit our directory webpage <a href="https://beyondvangogh.com/">here</a>. Please keep an eye on our social media channels for announcements of new cities!
For more information or to buy tickets visit their website at: <a href="https://vangoghalbuquerque.com/">https://vangoghalbuquerque.com/</a>2022-01-31T08:50:00-07:002022-01-31T08:55:27-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:17539What’s Going To Happen with Home Prices This Year?What’s Going To Happen with Home Prices This Year?
<img width="750" height="410" src="https://files.mykcm.com/2022/01/12163230/20220113-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What’s Going To Happen with Home Prices This Year? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/01/12163230/20220113-KCM-Share.jpg 750w, https://files.mykcm.com/2022/01/12163230/20220113-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/01/12163230/20220113-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
After almost two years of double-digit increases, many experts thought home price appreciation would decelerate or happen at a slower pace in the last quarter of 2021. However, the latest <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights/" title="Home Price Insights Report" target="_blank" rel="noopener noreferrer">Home Price Insights Report</a> from CoreLogic indicates while prices may have plateaued, appreciation has definitely not slowed. The following graph shows year-over-year appreciation throughout 2021. December data has not yet been released.
<a href="https://files.mykcm.com/2022/01/12163035/20220113-MEM-Eng-1.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-100587" src="https://files.mykcm.com/2022/01/12163035/20220113-MEM-Eng-1.png" alt="What’s Going To Happen with Home Prices This Year? | MyKCM" width="600" height="450" /></a>
As the graph shows, appreciation has remained steady at around 18% over the last five months.
In addition, the latest <a href="https://www.spglobal.com/spdji/en/documents/indexnews/announcements/20211228-1448566/1448566_cshomeprice-release-1228.pdf" title="S&amp;P Case-Shiller Price Index" target="_blank" rel="noopener noreferrer">S&P Case-Shiller Price Index</a> and the <a href="https://www.fhfa.gov/AboutUs/Reports/Pages/US-House-Price-Index-December-2021.aspx" title="FHFA Price Index" target="_blank" rel="noopener noreferrer">FHFA Price Index</a> show a slight deceleration from the same time last year – it's just not at the level that was expected. However, they also both indicate there’s continued strong price growth throughout the country. FHFA reports all nine regions of the country still experienced double-digit appreciation. The Case-Shiller 20-City Index reveals all 20 metros had double-digit appreciation.
Why Haven’t We Seen the Deeper Deceleration Many Expected?
Experts had projected the supply of housing inventory would increase in the last half of 2021 and buyer demand would decrease, as it historically does later in the year. Since all pricing is subject to supply and demand, it seemed that appreciation would wane under those conditions.
<a href="https://www.simplifyingthemarket.com/2022/01/05/why-waiting-to-sell-your-house-could-cost-you-a-small-fortune/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="Buyer demand">Buyer demand</a>, however, did not slow as much as expected, and the number of listings available for sale dropped instead of improved. The graph below uses <a href="https://www.realtor.com/research/data/" title="data" target="_blank" rel="noopener noreferrer">data</a> from realtor.com to show the number of available listings for sale each month, including the decline in listings at the end of the year.
<a href="https://files.mykcm.com/2022/01/12163137/20220113-MEM-Eng-2.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-100588" src="https://files.mykcm.com/2022/01/12163137/20220113-MEM-Eng-2.png" alt="What’s Going To Happen with Home Prices This Year? | MyKCM" width="600" height="450" /></a>
Here are three reasons why the number of active listings didn’t increase as expected:
1. There hasn’t been a surge of <a href="https://www.simplifyingthemarket.com/2022/01/06/there-wont-be-a-wave-of-foreclosures-in-the-housing-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="foreclosures">foreclosures</a> as the forbearance program comes to an end.
2. New construction slowed considerably because of <a href="https://www.probuilder.com/nahb-chairmans-letter-nahb-takes-action-solve-supply-chain-issues" title="supply chain challenges" target="_blank" rel="noopener noreferrer">supply chain challenges</a>.
3. Many believed more sellers would put their houses on the market once the concerns about the pandemic began to ease. However, those concerns have not yet disappeared. A <a href="https://www.realtor.com/advice/buy/omicron-impact-on-real-estate-homebuyers-sellers-need-to-know/" title="recent article" target="_blank" rel="noopener noreferrer">recent article</a> published by com explains:
“Before the omicron variant of COVID-19 appeared on the scene, the 2021 housing market was rebounding healthily from previous waves of the pandemic and turned downright bullish as the end of the year approached. . . . And then the new omicron strain hit in November, followed by a December dip in new listings. Was this sudden drop due to omicron, or just the typical holiday season lull?”
No one knows for sure, but it does seem possible.
Bottom Line
Home price appreciation might slow (or decelerate) in 2022. However, based on supply and demand, you shouldn’t expect the deceleration to be swift or deep.
2022-01-13T08:08:00-07:002022-01-13T08:10:48-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:17465Eight Things to Consider When Finding a Lot to Build On
<article id="post-53176" class="post-53176 post type-post status-publish format-standard hentry category-buying-selling category-real-estate tag-home-building tag-property tag-real-estate tag-real-estate-questions tag-real-estate-tips branded-posts-category-buying-and-selling" role="article" itemscope="" itemtype="http://schema.org/BlogPosting">
There’s a lot to like about building your own home. You’re able to customize it to your personal preferences, you’ll pay lower utility bills thanks to the latest energy-efficient systems and materials, and you’ll likely face less maintenance issues than if you moved into an older home.
However, before deciding how many bathrooms your home should have or what hue you want to paint the living room, you’ll need to find somewhere to build your home. It is important to consider the following property concerns to find a lot that suits your needs.
<img src="https://2c9vb53m9fr03ltecf31gw8q-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/buyingalot-intext-1.jpg" alt="" />
Location
The property’s location will have a major impact on whether or not it’s right for you. First, check to see how the location fits into your daily routine. You should visit the lot at various times of day to make sure it works for you. This will allow you to see how busy the area gets and how long your commute to work or school may last.
Second, consider how the land’s location affects your access to local amenities. A home too close to shopping and recreation could become busy and noisy. However, if you’re too far from these areas, it will be less convenient or could affect the resale value.
<img src="https://2c9vb53m9fr03ltecf31gw8q-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/buyingalot-intext-2.jpg" alt="" />
Shape
Even if two lots have the same square footage, they can be entirely different due to the property lines. So, for example, a square lot would be easier to build on than a longer narrow lot of the same size. Knowing the overall shape of the property will allow you get an idea of where your home could be built on the lot, along with how large the yard will be. Getting a property survey done before buying a property helps you better understand any lot restrictions you may face.
<img src="https://2c9vb53m9fr03ltecf31gw8q-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/buyingalot-intext-3.jpg" alt="" />
Utilities
It is important to find out if the property has utility hookups. This is something you might take for granted in a pre-constructed home, but the lot you choose needs access to utilities like electricity, water, sewer, and gas. If the lot is in a rural area, some service providers may need a to run a line to the property for a fee. If the lot is too far from a municipality’s water and sewer lines, you’ll need to install a well and a septic system, which will add to your overall costs.
Additionally, consider how good your cell service is on the property. A remote property with limited cell service may need a landline connection in case of emergencies.
Zoning restrictions
Before you buy a lot and start construction, you need to find out if you can even build a home on the property. You may find this information on the county’s website, or you may want to visit the county planning office and check to see if there are any zoning restrictions. Some lots may have setbacks, which are restrictions stating how close you can build a home to a curb or property line.
This is where using a real estate agent to find a lot is helpful—an agent can walk you through the process while educating you on information that impacts how you build your home.
<img src="https://2c9vb53m9fr03ltecf31gw8q-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/buyingalot-intext-4.jpg" alt="" />
Road access
If the lot is in a neighborhood, this probably won’t be an issue. However, some rural lots are landlocked by other people’s property. In this case, you would need to establish an easement with the nearby property owner for the use of a driveway. An easement grants rights to one party to access another’s property for specific reasons. If you need use of a neighbor’s property to access a road, it is important to contact a real estate attorney to help design or review an easement.
Slope
Too little or too much slope on a property can cause problems for your future home. You’ll need some slope to help with drainage and avoid sitting water. However, too much slope may require soil stabilization and retaining walls to safely build on, adding an additional cost to your budget.
<img src="https://2c9vb53m9fr03ltecf31gw8q-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/buyingalot-intext-5.jpg" alt="" />
Soil
A lot’s soil can have a major impact on your construction plans and even your home’s future, making a soil test a necessary task. Soil that is full of absorptive clay or that is loose could cause foundation damage and requires additional foundational support. Soil with ledge rock can create problems with excavation and drainage.
Environmental issues
You should consider having an environmental survey done, especially on raw pieces of land, before buying and building on a lot. This will help you become aware of issues such as endangered species, conservation easements, or even environmental contamination, all of which can have a big impact on how you use the lot.
By finding a lot to fit your needs, you’ll be one step closer to building your dream home.
</article>
,2022-01-08T09:38:00-07:002022-01-08T09:40:11-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:15911The Big Question: Should You Renovate or Move?The Big Question: Should You Renovate or Move?
<img width="750" height="410" src="https://files.mykcm.com/2021/10/12131853/20211013-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="The Big Question: Should You Renovate or Move? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/10/12131853/20211013-KCM-Share.jpg 750w, https://files.mykcm.com/2021/10/12131853/20211013-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/10/12131853/20211013-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The last 18 months changed what many buyers are looking for in a home. Recently, the American Institute of Architects released their <a href="http://info.aia.org/AIArchitect/2021/reports/2021-q3/2021-Q3-Home-Design-Trends-Survey.pdf" title="AIA Home Design Trends Survey" target="_blank" rel="noopener noreferrer">AIA Home Design Trends Survey</a> results for Q3 2021. The survey reveals the following:
70% of respondents want more outdoor living space
69% of respondents want a home office (48% wanted multiple offices)
46% of respondents want a multi-function room/flexible space
42% of respondents want an au pair/in-law suite
39% of respondents want an exercise room/yoga space
If you’re a homeowner who wants to add any of the above, you have two options: renovate your current house or buy a home that already has the spaces you desire. The decision you make could be determined by factors like:
A possible desire to relocate
The difference in the cost of a renovation versus a purchase
Finding an existing home or designing a new home that has exactly what you want (versus trying to restructure the layout of your current house)
In either case, you’ll need access to capital: the funds for the renovation or the down payment your next home would require. The great news is that the money you need probably already exists in your current home in the form of <a href="https://www.simplifyingthemarket.com/2021/09/30/as-home-equity-rises-so-does-your-wealth/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity">equity</a>.
Home Equity Is Skyrocketing
The record-setting increases in home prices over the last two years dramatically improved homeowners’ <a href="https://www.simplifyingthemarket.com/2021/10/07/111285-reasons-you-should-buy-a-home-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity">equity</a>. The graph below uses data from <a href="https://www.corelogic.com/intelligence/homeowner-equity-insights/" title="CoreLogic" target="_blank" rel="noopener noreferrer">CoreLogic</a> to show the average home equity gain in the first quarter of the last nine years:<a href="https://files.simplifyingthemarket.com/2021/10/12131855/20211013-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99559" src="https://files.mykcm.com/2021/10/12131855/20211013-MEM-Eng-1.png" alt="The Big Question: Should You Renovate or Move? | MyKCM" width="600" height="450" /></a>Odeta Kushi, Deputy Chief Economist at First American, <a href="https://twitter.com/odetakushi/status/1445387423442214915" title="quantifies" target="_blank" rel="noopener noreferrer">quantifies</a> the amount of equity homeowners gained recently:
“Remember U.S. households own nearly $35 trillion in owner-occupied real estate, just over $11 trillion in debt, and the remaining ~$24 trillion in equity. In inflation adjusted terms, homeowners in Q2 had an average of $280,000 in equity- a historic high.”
As a homeowner, the money you need to purchase the perfect home or renovate your current house may be right at your fingertips. However, waiting to make your decision may increase the cost of tapping that equity.
If you decide to renovate, you’ll need to refinance (or take out an equity loan) to access the equity. If you decide to move instead and use your equity as a down payment, you’ll still need to mortgage the remaining difference between the down payment and the cost of your next home.
Mortgage rates are <a href="https://www.simplifyingthemarket.com/2021/10/05/the-main-key-to-understanding-the-rise-in-mortgage-rates/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="forecast">forecast</a> to increase over the next year. Waiting to leverage your equity will probably mean you’ll pay more to do so. According to the latest data from the <a href="https://www.fhfa.gov/DataTools/Downloads/Pages/National-Mortgage-Database-Aggregate-Data.aspx" title="Federal Housing Finance Agency" target="_blank" rel="noopener noreferrer">Federal Housing Finance Agency</a> (FHFA), almost 57% of current mortgage holders have a mortgage rate of 4% or below. If you’re one of those homeowners, you can keep your mortgage rate under 4% by doing it now. If you’re one of the 43% of homeowners with a mortgage rate over 4%, you may be able to do a cash-out refinance or buy a more expensive home without significantly increasing your monthly payment.
First Step: Determine the Amount of Equity in Your Home
If you’re ready to either redesign your current house or find an existing or newly constructed home that has everything you want, the first thing you need to do is determine how much equity you have in your current home. To do that, you’ll need two things:
The current mortgage balance on your home
The current value of your home
You can probably find the mortgage balance on your monthly mortgage statement. To find the current market value of your house, you can pay several hundreds of dollars for an appraisal, or you can contact a local real estate professional who will be able to present to you, at no charge, a professional equity assessment report.
Bottom Line
If the past 18 months have refocused your thoughts on what you want from your house, now may be the time to either renovate or make a move to the perfect home.
2021-10-13T07:49:00-07:002021-10-13T07:49:59-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:15756What Do Supply and Demand Tell Us About Today’s Housing Market?What Do Supply and Demand Tell Us About Today’s Housing Market?
<img width="750" height="410" src="https://files.mykcm.com/2021/10/04164320/20211006-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What Do Supply and Demand Tell Us About Today’s Housing Market? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/10/04164320/20211006-KCM-Share.jpg 750w, https://files.mykcm.com/2021/10/04164320/20211006-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/10/04164320/20211006-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
There’s a well-known economic theory – the law of supply and demand – that explains what’s happening with prices in the current real estate market. Put simply, when demand for an item is high, prices rise. When the supply of the item increases, prices fall. Of course, when demand is very high and supply is very low, prices can rise significantly.
Understanding the impact both supply and demand have can provide the answers to a few popular questions about today’s housing market:
Why are prices rising?
Where are prices headed?
What does this mean for homebuyers?
Why Are Prices Rising?
According to the latest <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights/" title="Home Price Insights" target="_blank" rel="noopener noreferrer">Home Price Insights</a> report from CoreLogic, home prices have risen 18.1% since this time last year. But what’s driving the increase?
Recent buyer and seller activity data from the <a href="https://www.nar.realtor/research-and-statistics/research-reports/realtors-confidence-index" title="National Association of Realtors" target="_blank" rel="noopener noreferrer">National Association of Realtors</a> (NAR) helps answer that question. When we take NAR’s buyer activity data and compare it to the seller traffic during the same timeframe, we can see buyer demand continues to outpace seller activity by a wide margin. In other words, the demand for homes is significantly greater than the current supply that’s available to buy (see maps below):<a href="https://files.simplifyingthemarket.com/2021/10/04164322/20211006-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99489" src="https://files.mykcm.com/2021/10/04164322/20211006-MEM-Eng-1.png" alt="What Do Supply and Demand Tell Us About Today’s Housing Market? | MyKCM" width="600" height="338" /></a>This combination of low supply and high demand is what’s driving home prices up. Bill McBride, author of the <a href="https://calculatedrisk.substack.com/p/house-price-to-median-income" title="Calculated Risk" target="_blank" rel="noopener noreferrer">Calculated Risk</a> blog, puts it best, saying:
“By some measures, house prices seem high, but the recent price increases make sense from a supply and demand perspective.”
Where Are Prices Headed?
The supply of homes for sale will greatly affect where prices head over the coming months. Many experts forecast prices will continue to increase, but they’ll likely appreciate at a slower rate.
Buyers hoping to purchase the home of their dreams may see this as <a href="https://www.simplifyingthemarket.com/2021/09/17/have-you-ever-seen-a-housing-market-like-this-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="welcome news">welcome news</a>. In this case, perspective is important: a slight moderation of home prices does not mean prices will depreciate or fall. Price increases may occur at a slower pace, but experts still expect them to rise.
Five major entities that closely follow the real estate market forecast home prices will continue appreciating through 2022 (see graph below):<a href="https://files.simplifyingthemarket.com/2021/10/04164324/20211006-MEM-Eng-2.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99490" src="https://files.mykcm.com/2021/10/04164324/20211006-MEM-Eng-2.png" alt="What Do Supply and Demand Tell Us About Today’s Housing Market? | MyKCM" width="600" height="450" /></a>
What Does This Mean for Homebuyers?
If you’re <a href="https://www.simplifyingthemarket.com/2021/09/23/two-reasons-why-waiting-a-year-to-buy-could-cost-you/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="waiting">waiting</a> to enter the market because you’re expecting prices to drop, you may end up paying more in the long run. Even if price increases occur at a slower rate next year, prices are still projected to rise. That means the home of your dreams will likely cost even more in 2022.
Bottom Line
The truth is, high demand and low supply are what’s driving up home prices in today’s housing market. And while prices may increase at a slower pace in the coming months, experts still expect them to rise. If you’re a potential homebuyer, let’s connect today to discuss what that could mean for you if you wait even longer to buy.
2021-10-06T07:06:00-07:002021-10-06T07:07:45-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:15200Why 2021 Is Still the Year To Sell Your HouseWhy 2021 Is Still the Year To Sell Your House
<img width="750" height="410" src="https://files.mykcm.com/2021/08/24123816/20210825-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Why 2021 Is Still the Year To Sell Your House | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/08/24123816/20210825-KCM-Share.jpg 750w, https://files.mykcm.com/2021/08/24123816/20210825-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/08/24123816/20210825-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re trying to decide whether or not to <a href="https://www.simplifyingthemarket.com/2021/08/06/ready-to-sell-but-dont-know-where-youll-go-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sell your house">sell your house</a>, this is the time to think seriously about making a move. Fannie Mae’s recent <a href="https://www.fanniemae.com/research-and-insights/surveys/national-housing-survey" title="Home Purchase Sentiment Index" target="_blank" rel="noopener noreferrer">Home Purchase Sentiment Index</a> (HPSI) reveals the number of respondents who say it’s a good time to sell is higher now than it was over the past few summers (see graph below). Today, the majority of consumers, 75 percent, say it’s a good time to <a href="https://www.simplifyingthemarket.com/2021/08/09/the-community-and-economic-impacts-of-a-home-sale/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sell a house">sell a house</a>.<a href="https://files.simplifyingthemarket.com/2021/08/24123635/20210825-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99135" src="https://files.mykcm.com/2021/08/24123635/20210825-MEM-Eng-1.png" alt="Why 2021 Is Still the Year To Sell Your House | MyKCM" width="600" height="450" /></a>
Why is sellers sentiment up year-over-year?
The higher good time to sell sentiment has to do with today’s <a href="https://www.simplifyingthemarket.com/2021/07/22/todays-real-estate-market-explained-through-4-key-trends/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="market conditions">market conditions</a>, specifically low housing supply and high buyer demand. In the simplest terms, we don’t have enough houses available for sale to meet buyer demand.
According to <a href="https://www.nar.realtor/newsroom/existing-home-sales-climb-2-0-in-july" title="the latest data" target="_blank" rel="noopener noreferrer">the latest data</a> from the National Association of Realtors (NAR), we’re still firmly in a <a href="https://www.simplifyingthemarket.com/2021/08/17/what-does-being-in-a-sellers-market-mean/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market">sellers’ market</a> because housing supply is well below a balanced norm (shown in the graph below).<a href="https://files.simplifyingthemarket.com/2021/08/24123632/20210825-MEM-Eng-2.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99134" src="https://files.mykcm.com/2021/08/24123632/20210825-MEM-Eng-2.png" alt="Why 2021 Is Still the Year To Sell Your House | MyKCM" width="600" height="450" /></a>Clearly, the scales are tipped in a seller’s favor today. But while <a href="https://www.simplifyingthemarket.com/2021/07/27/a-look-at-housing-supply-and-what-it-means-for-sellers/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="housing supply">housing supply</a> is undeniably low, the right side of the graph shows how the inventory situation is improving little by little each month as more sellers list their homes for sale.
As a seller, that means each month, buyers have more options to pick from. By extension, that means your house may get less buyer attention with time. Danielle Hale, Chief Economist for realtor.com, <a href="https://www.realtor.com/research/weekly-housing-trends-view-data-week-july-31-2021/" title="explains it like this" target="_blank" rel="noopener noreferrer">explains it like this</a>:
“More homeowners continue to list homes for sale compared to a year ago… Notably, while new listings continue to lag behind a more ‘normal’ 2019 pace, the gap is shrinking. Even though homes continue to sell quickly thanks to high demand and limited supply, new listings are subtly shifting the balance of market conditions in favor of buyers.”
So, what’s that mean for you?
If you’ve been waiting for the perfect time to sell, there may not be a better chance than right now. Inventory is gradually increasing each month, so selling sooner rather than later will help you maximize your <a href="https://www.simplifyingthemarket.com/2021/08/04/sellers-make-todays-home-price-appreciation-work-for-you/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="home’s potential">home’s potential</a>.
Bottom Line
If you’re planning to sell your house, 2021 is still the year to do it. The unique mix of low supply and high demand won’t last forever. Let’s connect to discuss what you need to do now to sell your house and take advantage of this sellers’ market.
2021-08-26T13:27:00-07:002021-08-26T13:29:47-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:15153What Do Experts Say About Today’s Mortgage Rates?What Do Experts Say About Today’s Mortgage Rates?
<img width="750" height="410" src="https://files.mykcm.com/2021/08/19154921/20210823-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What Do Experts Say About Today’s Mortgage Rates? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/08/19154921/20210823-KCM-Share.jpg 750w, https://files.mykcm.com/2021/08/19154921/20210823-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/08/19154921/20210823-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Mortgage rates are hovering near record lows, and that’s good news for today’s homebuyers. The <a href="http://www.freddiemac.com/pmms/pmms_archives.html" title="graph" target="_blank" rel="noopener noreferrer">graph</a> below shows mortgage rates dating back to 2016 and where today falls by comparison.<a href="https://files.simplifyingthemarket.com/2021/08/19154923/20210823-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99108" src="https://files.mykcm.com/2021/08/19154923/20210823-MEM-Eng-1.png" alt="What Do Experts Say About Today’s Mortgage Rates? | MyKCM" width="600" height="450" /></a>Generally speaking, when rates are low, you can afford more home for your money. That’s why experts across the industry agree – today’s low rates present buyers with an <a href="https://www.simplifyingthemarket.com/2021/02/19/home-mortgage-rates-by-decade-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="incredible opportunity">incredible opportunity</a>. Here’s what they have to say:
Sam Khater, Chief Economist at Freddie Mac, <a href="https://freddiemac.gcs-web.com/node/23271/pdf" title="points out" target="_blank" rel="noopener noreferrer">points out</a> the historic nature of today’s rates:
“As the economy works to get back to its pre-pandemic self, and the fight against COVID-19 variants unfolds, owners and buyers continue to benefit from some of the lowest mortgage rates of all-time.”
Mark Fleming, Chief Economist at First American, <a href="https://blog.firstam.com/economics/affordability-declined-for-third-month-in-a-row" title="talks about" target="_blank" rel="noopener noreferrer">talks about</a> how rates impact a buyer’s bottom line:
“Mortgage rates are generally the same across the country, so a decline in mortgage rates boosts affordability equally in each market.”
Danielle Hale, Chief Economist at realtor.com, also notes the significance of today’s low rates and <a href="https://www.realtor.com/research/freddie-mac-mortgage-rates-july-29-2021/" title="urges buyers" target="_blank" rel="noopener noreferrer">urges buyers</a> to carefully consider their timing:
“Those who haven’t yet taken advantage of low rates to buy a home or refinance still have the opportunity to do so this summer.”
Hale goes on to say that buyers who don’t act soon could see <a href="https://www.simplifyingthemarket.com/2021/07/19/what-you-should-do-before-interest-rates-rise/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="higher rates">higher rates</a> in the coming months, negatively impacting their purchasing power:
“We expect mortgage rates to fluctuate near historic lows through the summer before beginning to climb this fall.”
And while mortgage rates are still low today, the data from Freddie Mac indicates rates are fluctuating ever so slightly right now, as they moved up one week before inching slightly back down in their latest release. It’s important to keep in mind the influence rates have on your monthly mortgage payment.
Even small increases can have a big <a href="https://www.simplifyingthemarket.com/2021/07/30/waiting-to-buy-a-home-could-cost-you-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="impact">impact</a> on what you pay each month. Trust the experts. Today’s rates give you opportunity and flexibility in what you can afford. Don’t wait on the sidelines and hope for a better rate to come along; the rates we’re seeing today are worth capitalizing on.
Bottom Line
Mortgage rates hover near record lows today, but experts forecast they’ll rise in the coming months. Waiting could prove costly when that happens. Let’s connect today to discuss today’s rates and determine if now’s the time for you to buy.
2021-08-23T07:11:00-07:002021-08-23T07:13:04-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:139743 Things To Prioritize When Selling Your House3 Things To Prioritize When Selling Your House
<img width="750" height="410" src="https://files.mykcm.com/2021/05/20154808/20210524-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="3 Things To Prioritize When Selling Your House | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/05/20154808/20210524-KCM-Share.jpg 750w, https://files.mykcm.com/2021/05/20154808/20210524-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/05/20154808/20210524-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Today’s housing market is full of unprecedented <a href="https://www.simplifyingthemarket.com/2021/05/13/your-house-could-be-the-oasis-in-an-inventory-desert/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="opportunities" target="_blank" rel="noopener noreferrer">opportunities</a>. High buyer demand paired with record-low housing inventory is creating the ultimate <a href="https://www.simplifyingthemarket.com/2021/03/29/what-it-means-to-be-in-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>, which means it’s a fantastic time to <a href="https://www.simplifyingthemarket.com/2021/05/10/3-graphs-showing-why-you-should-sell-your-house-now/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sell your house" target="_blank" rel="noopener noreferrer">sell your house</a>. However, that doesn’t mean sellers are guaranteed success no matter what. There are still some key things to know so you can avoid costly mistakes and win big when you make a move.
1. Price Your House Right
When inventory is low, like it is in the current market, it’s common to think buyers will pay whatever we ask when setting a listing <a href="https://www.simplifyingthemarket.com/2021/05/11/experts-say-home-prices-will-continue-to-appreciate/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="price" target="_blank" rel="noopener noreferrer">price</a>. Believe it or not, that’s not always true. Even in a sellers’ market, listing your house for the right price will maximize the number of buyers that see your house. This creates the best environment for bidding wars, which in turn are more likely to increase the final sale price. A real estate professional is the best person to help you set the best price for your house so you can achieve your financial goals.
2. Keep Your Emotions in Check
Today, homeowners are living in their houses for a longer period of time. Since 1985, the average time a homeowner owned their home, or their tenure, has increased from 5 to 10 years (See graph below):<a href="https://files.simplifyingthemarket.com/2021/05/20154810/20210524-MEM-Eng-1.jpg?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98080" src="https://files.mykcm.com/2021/05/20154810/20210524-MEM-Eng-1.jpg" alt="3 Things To Prioritize When Selling Your House | MyKCM" width="600" height="450" /></a>This is several years longer than what used to be the historical norm. The side effect, however, is when you stay in one place for so long, you may get even more emotionally attached to your space. If it’s the first home you purchased or the house where your children grew up, it very likely means something extra special to you. Every room has memories, and it’s hard to detach from that sentimental value.
For some homeowners, that connection makes it even harder to separate the emotional value of the house from the fair market price. That’s why you need a <a href="https://www.simplifyingthemarket.com/2021/04/06/dont-sell-on-your-own-just-because-its-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="real estate professional" target="_blank" rel="noopener noreferrer">real estate professional</a> to help you with the negotiations along the way.
3. Stage Your House Properly
We’re generally quite proud of our décor and how we’ve customized our houses to make them our own unique homes. However, not all buyers will feel the same way about your design and personal touches. That’s why it’s so important to make sure you <a href="https://www.simplifyingthemarket.com/2021/04/26/4-tips-to-maximize-the-sale-of-your-house/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="stage" target="_blank" rel="noopener noreferrer">stage</a> your house with the buyer in mind.
Buyers want to envision themselves in the space so it truly feels like it could be their own. They need to see themselves inside with their furniture and keepsakes – not your pictures and decorations. Stage, clean, and declutter so they can visualize their own dreams as they walk through each room. A real estate professional can help you with tips to get your home ready to stage and sell.
Bottom Line
Today’s sellers’ market might be your <a href="https://www.simplifyingthemarket.com/2021/05/04/4-big-incentives-for-homeowners-to-sell-now/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="best chance" target="_blank" rel="noopener noreferrer">best chance</a> to make a move. If you’re considering selling your house, let’s connect today so you have the expert guidance you need to navigate through the process and prioritize these key elements.
2021-05-25T11:46:00-07:002021-05-25T11:48:03-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:114474 Big Incentives for Homeowners to Sell Now4 Big Incentives for Homeowners to Sell Now
<img width="750" height="410" src="https://files.mykcm.com/2021/05/03154106/20210504-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="4 Big Incentives for Homeowners to Sell Now | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/05/03154106/20210504-KCM-Share.jpg 750w, https://files.mykcm.com/2021/05/03154106/20210504-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/05/03154106/20210504-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The housing market keeps sailing along. The only headwind that could take it off course is the lack of inventory for sale. The National Association of Realtors (NAR) reports that there were <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-02-2021-single-family-only-2021-03-22.pdf" title="410,000" target="_blank" rel="noopener noreferrer">410,000</a> fewer single-family homes for sale this March than in March of 2020. The key to continued success in the residential housing market is for more listings to come on the market. However, many homeowners are concerned that <a href="https://www.simplifyingthemarket.com/2021/03/04/is-it-a-good-time-to-sell-my-house/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="selling" target="_blank" rel="noopener noreferrer">selling</a> their homes could be challenging for several reasons.
Recently, Homes.com released the findings of a <a href="https://www.homes.com/blog/2021/04/how-can-sellers-unlock-the-housing-market/" title="survey" target="_blank" rel="noopener noreferrer">survey</a> that identified these concerns, as well as what it will take for homeowners to feel comfortable selling their houses. Here are the four major homeowner concerns and a quick explanation of what’s actually happening in the housing market today.
1. Homeowners don’t know if they’ll be able to secure their next home before selling.
In negotiations, <a href="https://www.simplifyingthemarket.com/2021/02/24/how-much-leverage-do-todays-house-sellers-have/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="leverage" target="_blank" rel="noopener noreferrer">leverage</a> is the power that one side may have to influence the other side while moving closer to their negotiating position. A party’s leverage is based on the ability to award benefits or eliminate costs on the other side.
In today’s market, buyers have compelling reasons to purchase a home now:
To own a home of their own
To buy before prices continue to appreciate
To secure a mortgage at a historically low rate, while they last
These buyer needs give the seller tremendous leverage. Most already realize this leverage enables the homeowner to sell at a good price. However, this leverage may also be used to negotiate time to find their next home. The homeowner could sell their home to the buyer at today’s price, which will enable the purchaser to take advantage of current mortgage rates. In return, the buyer might lease the house back to the seller for a pre-determined length of time while the seller finds a new home or has one built.
This gives the buyer what they want while also giving the seller what they need. It’s a true win-win negotiation.
2. Homeowners don’t know if their current home will sell for the asking price or top market price.
This is the perfect time to maximize profits while selling a house. NAR just released a <a href="https://www.nar.realtor/blogs/economists-outlook/how-are-buyers-coping-in-a-highly-competitive-housing-market" title="study" target="_blank" rel="noopener noreferrer">study</a> showing that bidding wars are at an all-time high. The study reveals that when comparing the first quarter of last year to the first quarter of this year, the number of offers on homes for sale doubled from an average of 2.4 to 4.8 offers.
Whenever there’s a bidding war, the price of the item for sale escalates. Bloomberg recently <a href="https://www.bloomberg.com/news/articles/2021-04-09/home-prices-soar-in-frenzied-u-s-market-drained-of-supply?sref=BRvilyBN" title="reported" target="_blank" rel="noopener noreferrer">reported</a>:
“For the first time ever, the average U.S. home is selling for above its list price.”
If a seller is looking for a top-dollar sale, there’s no better time to sell than right now.
3. Homeowners don’t know if they will get an offer without their home requiring work or updates.
Again, leverage is the greatest strength a seller has in this market. Due to the lack of homes for sale, many buyers are more willing to take on home improvement projects themselves in order to get the home they’re after.
A recent <a href="https://www.simplifyingthemarket.com/2021/03/18/to-renovate-or-not-to-renovate-before-you-sell/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="post" target="_blank" rel="noopener noreferrer">post</a> on whether or not to renovate before selling notes:
“It may be wise to let future homeowners remodel the bathroom or the kitchen to make design decisions that are best for their specific taste and lifestyle. As a seller, your dollars and time might be better spent working on small cosmetic updates, like refreshing some paint and power washing the exterior. Instead of over-investing in your home with upgrades that the buyers may change anyway, work with a real estate professional to determine the key projects that will maximize your listing, without overdoing it.”
If a seller is worried about doing work or updates on their home, they must realize that today’s historically low inventory likely renders these projects less critical to the sale of the house.
4. Homeowners don’t know if they can have a quick closing process.
When speed is important, there are two points sellers should look at:
The time it takes to find a buyer for the home
The time it takes to close the transaction
In the latest <a href="https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a>, NAR explains:
“Properties typically remained on the market for 18 days in March, down from 20 days in February and from 29 days in March 2020. Eighty-three percent of the homes sold in March 2021 were on the market for less than a month.”
Eighteen days is fast, and it’s a new record. Here are the days the average house is on the market in each state:<a href="https://files.simplifyingthemarket.com/2021/05/03154108/20210504-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97966" src="https://files.mykcm.com/2021/05/03154108/20210504-MEM-Eng-1.png" alt="4 Big Incentives for Homeowners to Sell Now | MyKCM" width="600" height="450" /></a>Regarding the time it will take to close the transaction, <a href="https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march" title="all-cash sales" target="_blank" rel="noopener noreferrer">all-cash sales</a> accounted for 23% of all home purchase transactions in March. All-cash sales can usually be closed in thirty days.
If a mortgage is necessary, the most recent <a href="https://static.elliemae.com/pdf/origination-insight-reports/ICE_OIR_MAR2021.pdf" title="Origination Insight Report" target="_blank" rel="noopener noreferrer">Origination Insight Report</a> from Ellie Mae shows:
“Time to close all loans decreased in March. The average time to close a purchase fell to 51 days, down from 53 the month prior.”
If you’re looking for a quick closing process, there’s never been a market in which the two-step process (finding a buyer and closing the deal) has taken less time.
Bottom Line
Selling your house can be daunting, especially in a fast-paced market. However, the fact that we’re in such a strong sellers’ market clearly eliminates many common concerns. Let’s connect today so you can learn more about the opportunities for homeowners who are ready to sell.
2021-05-07T11:20:00-07:002021-05-06T11:20:42-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11446Why Waiting to Buy a Home Could Cost You a Small FortuneWhy Waiting to Buy a Home Could Cost You a Small Fortune
<img width="750" height="410" src="https://files.mykcm.com/2021/05/05131354/20210506-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Why Waiting to Buy a Home Could Cost You a Small Fortune | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/05/05131354/20210506-KCM-Share.jpg 750w, https://files.mykcm.com/2021/05/05131354/20210506-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/05/05131354/20210506-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Many people are sitting on the fence trying to decide if now’s the time to <a href="https://www.simplifyingthemarket.com/2021/04/28/patience-is-the-key-to-buying-a-home-this-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="buy a home" target="_blank" rel="noopener noreferrer">buy a home</a>. Some are renters who have a strong desire to become homeowners but are unsure if buying right now makes sense. Others may be homeowners who are realizing that their current home no longer fits their changing needs.
To determine if they should buy now or wait another year, they both need to ask two simple questions:
Do I think home values will be higher a year from now?
Do I think mortgage rates will be higher a year from now?
Let’s shed some light on the answers to these questions.
Where will home prices be a year from now?
If you average the most recent <a href="https://www.simplifyingthemarket.com/2021/04/29/is-home-price-appreciation-accelerating-again/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="projections" target="_blank" rel="noopener noreferrer">projections</a> from the major industry forecasters, the expectation is home prices will increase by 7.7%. Let’s take a house that’s valued today at $325,000 as an example.
If the buyer makes a 10% down payment ($32,500), they’ll end up borrowing $292,500 for their mortgage. Applying the projected rate of home price appreciation, that same house will cost $350,025 next year. With a 10% down payment ($35,003), they’d then have to borrow $315,022.
Therefore, as a result of rising home prices alone, a prospective buyer will have to put down an additional $2,503 and borrow an additional $22,523 just for waiting a year to make their move.
Where will mortgage rates be a year from now?
Today, <a href="https://www.simplifyingthemarket.com/2021/04/21/planning-to-move-you-can-still-secure-a-low-mortgage-rate-on-your-next-home/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="mortgage rates" target="_blank" rel="noopener noreferrer">mortgage rates</a> are hovering around 3%. However, most experts believe they’ll <a href="https://www.simplifyingthemarket.com/2021/05/05/are-interest-rates-expected-to-rise-over-the-next-year/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="rise" target="_blank" rel="noopener noreferrer">rise</a> as the economy continues to recover. Any increase in the mortgage rate will also increase a purchaser’s cost. Here are the forecasts for the first quarter of 2022 from four major entities:
<a href="http://www.freddiemac.com/research/forecast/20210414_quarterly_economic_forecast.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a> – 3.5%
<a href="https://www.fanniemae.com/research-and-insights/forecast" title="Fannie Mae" target="_blank" rel="noopener noreferrer">Fannie Mae</a> – 3.5%
<a href="https://cdn.nar.realtor/sites/default/files/documents/forecast-Q2-2021-us-economic-outlook-04-29-2021.pdf" title="National Association of Realtors" target="_blank" rel="noopener noreferrer">National Association of Realtors</a> – 3.5%
<a href="https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-and-commentary" title="Mortgage Bankers Association" target="_blank" rel="noopener noreferrer">Mortgage Bankers Association</a> – 3.9%
The projections average out to 3.6% among these four forecasts, a jump up from where they are today.
What does it mean to you if home values and mortgage rates increase?
A buyer will pay a lot more in mortgage payments each month if both of these variables increase. Assuming a buyer purchases a $325,000 home this year with a 30-year fixed-rate loan at 3% after making a 10% down payment, their monthly principal and interest payment would be $1,233.
That same home one year from now could be $350,025, and the mortgage rate could be 3.6% (based on the industry forecasts mentioned above). That monthly principal and interest payment, after putting down 10%, totals $1,432.
The difference in the monthly mortgage payment would be $199. That’s $2,388 more per year and $71,640 over the life of the loan.
Add to that the approximately $25,000 a house with a similar value would build in home <a href="https://www.simplifyingthemarket.com/2021/04/20/82338-great-reasons-to-buy-a-home-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity" target="_blank" rel="noopener noreferrer">equity</a> this year as a result of home price appreciation, and the total net worth increase a purchaser could gain by buying this year is nearly $100,000. That’s a small fortune.
Bottom Line
When asking if they should buy a home, many potential buyers think of the <a href="https://www.simplifyingthemarket.com/2021/05/03/americans-find-the-nonfinancial-benefits-of-homeownership-most-valuable/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="nonfinancial benefits" target="_blank" rel="noopener noreferrer">nonfinancial benefits</a> of owning a home. When asking when to buy, the financial benefits make it clear that doing so now is much more advantageous than waiting until next year.
2021-05-06T11:18:00-07:002021-05-06T11:19:36-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11392Is Home Price Appreciation Accelerating Again?<img width="750" height="410" src="https://files.mykcm.com/2021/04/28135118/20210429-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Is Home Price Appreciation Accelerating Again? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/28135118/20210429-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/28135118/20210429-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/28135118/20210429-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
At the beginning of the year, industry forecasts called for home price appreciation to slow to about half of the double-digit increase we saw last year. The thinking was that inventory would increase from record-low levels and put an end to the <a href="https://www.simplifyingthemarket.com/2021/04/02/buyer-competition-is-good-news-for-sellers-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="bidding wars" target="_blank" rel="noopener noreferrer">bidding wars</a> that have driven home prices up over the past twelve months. However, that increase in inventory has yet to materialize. The National Association of Realtors (NAR) <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-03-2021-single-family-only-2021-04-22.pdf" title="reports" target="_blank" rel="noopener noreferrer">reports</a> that there are currently 410,000 fewer single-family homes available for sale than there were at this time last year.
This has forced those who made appreciation forecasts this past January to amend those projections. The <a href="https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-and-commentary" title="Mortgage Bankers Association" target="_blank" rel="noopener noreferrer">Mortgage Bankers Association</a>, <a href="https://www.fanniemae.com/media/38961/display" title="Fannie Mae" target="_blank" rel="noopener noreferrer">Fannie Mae</a>, <a href="http://www.freddiemac.com/research/forecast/index.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>, the <a href="https://cdn.nar.realtor/sites/default/files/documents/forecast-Q1-2021-us-economic-outlook-01-30-2021.pdf" title="National Association of Realtors" target="_blank" rel="noopener noreferrer">National Association of Realtors</a>, and <a href="https://www.zelmanassociates.com/" title="Zelman &amp; Associates" target="_blank" rel="noopener noreferrer">Zelman & Associates</a> have all adjusted their numbers upward after reviewing first quarter housing data. Here are their original forecasts and their newly updated projections:<a href="https://files.simplifyingthemarket.com/2021/04/28135120/20210429-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97931" src="https://files.mykcm.com/2021/04/28135120/20210429-MEM-Eng-1.png" alt="Is Home Price Appreciation Accelerating Again? | MyKCM" width="600" height="450" /></a>Even with the increases, the updated projections still don’t reach the above 10% appreciation levels of 2020. However, a jump in the average projection from 5.3% to 7.7% after just one quarter is substantial. <a href="https://www.simplifyingthemarket.com/2021/04/27/will-the-housing-market-maintain-its-momentum/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="Demand" target="_blank" rel="noopener noreferrer">Demand</a> will remain strong, so future appreciation will be determined by how quickly listing inventory makes its way to the market.
Bottom Line
Entering 2021, there was some speculation that we might see price appreciation slow dramatically this year. Today, experts believe that won’t be the case. Home values will remain strong throughout the year.
2021-05-03T04:00:00-07:002021-05-02T10:52:32-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11344Will the Housing Market Maintain Its Momentum?<img width="750" height="410" src="https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Will the Housing Market Maintain Its Momentum? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
Last week’s <a href="https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a> from the National Association of Realtors (NAR) shows sales have dropped by 3.7% compared to the month before. This is the second consecutive month that sales have slumped. Some see this as evidence that the red-hot real estate market may be cooling. However, there could also be a simple explanation as to why existing home sales have slowed – there aren’t enough homes to buy. There are currently <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-03-2021-single-family-only-2021-04-22.pdf" title="410,000" target="_blank" rel="noopener noreferrer">410,000</a> fewer single-family homes available for sale than there were at this time last year.
Lawrence Yun, Chief Economist at NAR, explains in the report:
"The sales for March would have been measurably higher, had there been more inventory. Days-on-market are swift, multiple offers are prevalent, and buyer confidence is rising."
Yun’s insight was supported the next day when the Census Bureau released its <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="Monthly New Residential Sales Report" target="_blank" rel="noopener noreferrer">Monthly New Residential Sales Report</a>. It shows that newly constructed home sales are up 20.7% over the previous month.
Buyer demand remains strong. With more of the adult population becoming vaccinated and job creation data showing encouraging signs, existing-home inventory is expected to grow in the coming months.
What will this mean for home sales going forward?
<a href="https://www.fanniemae.com/media/38961/display" title="Fannie Mae" target="_blank" rel="noopener noreferrer">Fannie Mae</a>, <a href="http://www.freddiemac.com/research/forecast/20210414_quarterly_economic_forecast.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>, and the <a href="https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-and-commentary" title="Mortgage Bankers Association" target="_blank" rel="noopener noreferrer">Mortgage Bankers Association</a> (MBA) have all forecasted that total home sales (existing homes and new construction) will continue their momentum both this year and next. Here’s a graph showing those projections:<a href="https://files.simplifyingthemarket.com/2021/04/26121934/20210427-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97918" src="https://files.mykcm.com/2021/04/26121934/20210427-MEM-Eng-1.png" alt="Will the Housing Market Maintain Its Momentum? | MyKCM" width="600" height="450" /></a>
Bottom Line
Living through a pandemic has caused many to re-evaluate the importance of a home and the value of homeownership. The residential real estate market will benefit from both as we move forward.
2021-04-30T08:56:00-07:002021-04-28T08:56:32-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11343Patience Is the Key to Buying a Home This Year<img width="750" height="410" src="https://files.mykcm.com/2021/04/27160654/20210428-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Patience Is the Key to Buying a Home This Year | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/27160654/20210428-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/27160654/20210428-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/27160654/20210428-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
The question many homebuyers are facing this year is, “Why is it so hard to find a house?” We’re in the ultimate <a href="https://www.simplifyingthemarket.com/2021/03/29/what-it-means-to-be-in-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>, which means real estate is ultra-competitive for buyers right now. The National Association of Realtors (NAR) notes homes are getting an average of <a href="https://cdn.nar.realtor/sites/default/files/documents/2021-03-realtors-confidence-index-04-22-2021.pdf" title="4.8 offers" target="_blank" rel="noopener noreferrer">4.8 offers</a> per sale, and that number keeps rising. Why? It’s because there are so few houses for sale.
Low inventory in the housing market isn’t new, but it’s becoming more challenging to navigate. Danielle Hale, Chief Economist at realtor.com, <a href="https://www.realtor.com/research/weekly-housing-trends-view-data-week-apr-17-2021/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“The housing market is still relatively under supplied, and buyers can’t buy what’s not for sale. Relative to what we saw in 2017 to 2019, March 2021 was still roughly 117,000 new listings lower, adding to the pre-existing early-year gap of more than 200,000 fresh listings that would typically have come to market in January or February. Despite this week’s gain from a year ago, we’re 19 percent below the new seller activity that we saw in the same week in 2019.”
While many homeowners paused their plans to sell during the height of the pandemic, this isn’t the main cause of today’s huge gap between supply and demand. Sam Khater, Vice President and Chief Economist at Freddie Mac, Economic Housing and Research Division, <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="shares" target="_blank" rel="noopener noreferrer">shares</a>:
“The main driver of the housing shortfall has been the long-term decline in the construction of single-family homes . . . That decline has resulted in the decrease in supply of entry-level single-family homes or, ’starter homes.’”
When you consider the number of homes built in the U.S. <a href="https://twitter.com/RobertFrickNFCU/status/1383045732068888579" title="by decade" target="_blank" rel="noopener noreferrer">by decade</a>, the serious lack of new construction is clear (See graph below):<a href="https://files.simplifyingthemarket.com/2021/04/27160656/20210428-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97926" src="https://files.mykcm.com/2021/04/27160656/20210428-MEM-Eng-1.png" alt="Patience Is the Key to Buying a Home This Year | MyKCM" width="600" height="450" /></a>The number of newly built homes is disproportionately lower than the rate of household formation, which, according to the <a href="https://www.census.gov/data/tables/time-series/demo/families/households.html" title="U.S. Census Bureau" target="_blank" rel="noopener noreferrer">U.S. Census Bureau</a>, has continued to increase. Khater also <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Even before the COVID-19 pandemic and current recession, the housing market was facing a substantial supply shortage and that deficit has grown. In 2018, we estimated that there was a housing supply shortage of approximately 2.5 million units, meaning that the U.S. economy was about 2.5 million units below what was needed to match long-term demand. Using the same methodology, we estimate that the housing shortage increased to 3.8 million units by the end of 2020. A continued increase in a housing shortage is extremely unusual; typically in a recession, housing demand declines and supply rises, causing inventory to rise above the long-term trend.”
To catch up to current demand, <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a> estimates we need to build almost four million homes. The good news is builders are working hard to get us there. The U.S. Census Bureau also <a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" title="states" target="_blank" rel="noopener noreferrer">states</a>:
“Privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,766,000. This is 2.7 percent (±1.7 percent) above the revised February rate of 1,720,000 . . . Privately-owned housing starts in March were at a seasonally adjusted annual rate of 1,739,000. This is 19.4 percent (±13.7 percent) above the revised February estimate of 1,457,000. . . .”
What does this mean? Lawrence Yun, Chief Economist at NAR, <a href="https://www.linkedin.com/posts/lawrence-yun-592a76146_good-news-on-a-potential-turn-for-the-better-activity-6788821150567829506-nWur/" title="clarifies" target="_blank" rel="noopener noreferrer">clarifies</a>:
“The March figure of 1.74 million housing starts is the highest in 14 years. Both single-family units and multifamily units ramped up. After 13 straight years of underproduction – the chief cause for today’s inventory shortage – this construction boom needs to last for at least three years to make up for the part shortfall. As trade-up buyers purchase newly constructed homes, their prior homes will show up in MLSs, and hence, more choices for consumers. Housing starts to housing completion could be 4 to 8 months, so be patient with the improvement to inventory. In the meantime, construction workers deserve cheers.”
Bottom Line
If you’re planning to buy this year, the key to success will be patience, given today’s low inventory environment. Let’s connect today to talk more about what’s happening in our area.
2021-04-29T08:55:00-07:002021-04-28T08:55:38-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11345Americans Favor Homeownership as an Investment2021-04-28T08:56:36-07:002021-04-28T08:57:39-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:113424 Tips to Maximize the Sale of Your House<img width="750" height="410" src="https://files.mykcm.com/2021/04/22163726/20210426-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="4 Tips to Maximize the Sale of Your House | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/22163726/20210426-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/22163726/20210426-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/22163726/20210426-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
Homeowners ready to make a move are definitely in a great position to sell today. Housing inventory is incredibly low, driving up buyer competition. This gives homeowners <a href="https://www.simplifyingthemarket.com/2021/02/24/how-much-leverage-do-todays-house-sellers-have/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="leverage" target="_blank" rel="noopener noreferrer">leverage</a> to sell for the best possible terms, and it’s fueling a steady rise in home prices.
In such a hot market, houses are selling quickly. According to the National Association of Realtors (NAR), homes are typically on the market for just <a href="https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march" title="18" target="_blank" rel="noopener noreferrer">18</a> short days. Despite the speed and opportunity for sellers, there are still steps you can take to prep your house to shine so you get the greatest possible return.
1. Make Buyers Feel at Home
One of the ways to make this happen is to take time to declutter. Pack away any personal items like pictures, awards, and sentimental belongings. The more neutral and tidy the space, the easier it is for a buyer to picture themselves living there. According to the <a href="https://cdn.nar.realtor/sites/default/files/documents/2021-profile-of-home-staging-report-04-06-2021.pdf" title="2021 Profile of Home Staging" target="_blank" rel="noopener noreferrer">2021 Profile of Home Staging</a> by NAR:
“82% of buyers’ agents said staging a home made it easier for a buyer to visualize the property as a future home.”
Not only will your house potentially attract the attention of more buyers and likely sell quickly, but the same report also notes:
“Eighteen percent of sellers' agents said home staging increased the dollar value of a residence between 6% and 10%.”
As Jessica Lautz, Vice President of Demographics and Behavior Insights for NAR, <a href="https://magazine.realtor/daily-news/2021/04/06/nar-survey-design-shows-raise-buyer-expectations" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“Staging a home helps consumers see the full potential of a given space or property…It features the home in its best light and helps would-be buyers envision its various possibilities.”
2. Keep It Clean
On top of making an effort to declutter, it’s important to keep your house neat and clean. Before a buyer stops by, be sure to pick up toys, make the beds, and wash the dishes. This is one more way to reduce the number of things that can distract a buyer from the appeal of the home.
Ensure your home smells fresh and clean as well. Buyers will remember the smell of your house, and according to the same report from NAR, the kitchen is one of the most important rooms of the house to focus on if you want to attract more buyers.
3. Give Buyers Access
Buyers are less likely to make an offer on your house if they aren’t able to easily schedule a time to check it out. If your home is available anytime, that opens up more opportunities for multiple buyers to go from curious to eager. It also allows buyers on tight schedules to still get in to see your house.
While health continues to be a great concern throughout the country, it’s important to work with your agent to find the best <a href="https://www.simplifyingthemarket.com/2020/11/13/tips-to-sell-your-house-safely-right-now-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="safety measures" target="_blank" rel="noopener noreferrer">safety measures</a> and digital practices for your listing. This will drive visibility and create access options that also keep everyone in the process safe.
4. Price It Right
Even in a sellers’ market, it’s crucial to set your house at the <a href="https://www.simplifyingthemarket.com/2020/12/28/why-its-important-to-price-your-house-right-today/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="right price" target="_blank" rel="noopener noreferrer">right price</a> to maximize selling potential. Pricing your house too high is actually a detriment to the sale. The goal is to drive high attention from competing buyers and let bidding wars push the final sales price up.
Work with your trusted real estate professional to determine the best list price for your house. Having an expert on your side in this process is truly essential.
Bottom Line
If you want to sell on your terms, in the least amount of time, and for the best price, today’s market sets the stage to make that happen. Let’s connect today to determine the best ways to maximize the sale of your house this year.
2021-04-28T08:54:00-07:002021-04-28T08:54:41-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11226Some Buyers Prefer Smaller Homes<img width="750" height="410" src="https://files.mykcm.com/2021/04/12123919/20210413-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Some Buyers Prefer Smaller Homes | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/12123919/20210413-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/12123919/20210413-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/12123919/20210413-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
Over the past year, we’ve had plenty of opportunities to reflect on what we consider most important in our lives. The place we call <a href="https://www-realtor-com.cdn.ampproject.org/c/s/www.realtor.com/news/trends/housing-market-was-rocked-by-covid-19-where-we-go-from-here/amp/" title="home" target="_blank" rel="noopener noreferrer">home</a> is one of the biggest things many of us are reevaluating. George Ratiu, Senior Economist at realtor.com, shares:
“The very nature of the pandemic, through the health implications, social distancing, and need to isolate, has really brought a central focus on the importance of home for most Americans…In a sense, it has elevated real estate markets as a centerpiece of our lives.”
For some, this has spurred an interest in making a move to a home that better suits our changing needs. In a recent <a href="https://eyeonhousing.org/2021/03/nahb-releases-what-home-buyers-really-want-study-shows-covid-19-impacts/" title="study" target="_blank" rel="noopener noreferrer">study</a> on today’s homebuyer preferences, the National Association of Home Builders (NAHB) states:
“When asked more specifically how the pandemic may have impacted their preference for home size…21% or about 1 out of every 5 buyers, do want a larger home now as a direct result of the health crisis, while another segment – 12% – would prefer a smaller one instead.”
While you might expect more time at home to lead to a need for more space, it’s interesting that a significant portion of homeowners actually want less. For those who own larger homes right now and have a desire to move, today’s housing market is full of <a href="https://www.simplifyingthemarket.com/2021/03/29/what-it-means-to-be-in-a-sellers-market/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="opportunities" target="_blank" rel="noopener noreferrer">opportunities</a>. Danielle Hale, Chief Economist at realtor.com, <a href="https://www.realtor.com/news/trends/its-a-home-sellers-market-and-baby-boomers-are-cashing-in.amp/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“In a real estate market that is tipped in the favor of sellers, boomers and older homeowners are really the ones holding the cards…Those who are selling homes can use the profits to help them buy new ones.”
As a homeowner today, you likely have <a href="https://www.simplifyingthemarket.com/2021/03/19/americans-see-major-home-equity-gains-infographic/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="equity" target="_blank" rel="noopener noreferrer">equity</a> that can be put toward the purchase of your next home. With the equity growth homes have seen over the past year, you may have more than you think, which can help significantly as you make a move into your next home. According to a <a href="https://cdn.nar.realtor/sites/default/files/documents/2021-home-buyers-and-sellers-generational-trends-03-16-2021.pdf" title="report" target="_blank" rel="noopener noreferrer">report</a> from the National Association of Realtors (NAR):
“Home sellers cited that they sold their homes for a median of $66,000 more than they purchased it. Sellers 22 to 30 years gained the least at $33,400 in equity compared to sellers 66 to 74 years gained $100,000 in equity as they likely had lived in their homes for a longer period of time.”
Despite the benefits of growing home equity, some homeowners are still hesitant to move and could be considering remodeling or making changes to their current space instead. However, if you’ve thought about aging in place rather than downsizing, you may want to reconsider. The U.S. Census Bureau <a href="https://www.census.gov/library/stories/2020/06/old-housing-new-needs.html" title="points out" target="_blank" rel="noopener noreferrer">points out</a>:
“Of the nation’s 115 million housing units, only 10% are ready to accommodate older populations.”
If your house is no longer the best fit for your evolving needs, it may be time to put your equity to work for you and downsize to the home you really want.
Bottom Line
Today’s housing market favors homeowners who are ready to sell their houses and make a move. If you’re thinking about downsizing this year, let’s connect to discuss your options in our local market.
2021-04-21T08:55:00-07:002021-04-19T08:55:38-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11224Why This Is a Great Year to Sell Your Vacation Home<img width="750" height="410" src="https://files.mykcm.com/2021/04/13164149/20210415-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Why This Is a Great Year to Sell Your Vacation Home | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/13164149/20210415-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/13164149/20210415-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/13164149/20210415-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
As vaccines are administered and travel resumes, many of us are beginning to plan for those long-awaited vacations we missed out on over the past year. Some households are focusing their efforts on buying a vacation home rather than staying in a hotel, too. The National Association of Home Builders (NAHB) <a href="https://eyeonhousing.org/2021/03/second-homes-15-percent-of-new-home-sales/" title="reports" target="_blank" rel="noopener noreferrer">reports</a>:
“Second homes (i.e., homes sold to buyers who are not going to occupy the home year-round, but use it as a vacation home, investment property, etc.) account for 15 percent of new single-family home sales.”
It’s not surprising that there’s an increase in demand for vacation homes. The majority of Americans are realizing they prefer to be around small groups, as shown in a recent <a href="https://theharrispoll.com/wp-content/uploads/2021/03/Harris-Poll-COVID-1-year-FINAL-3.pdf" title="survey" target="_blank" rel="noopener noreferrer">survey</a> from The Harris Poll:
“Social distancing taught consumers new things about how they like to socialize; (75%) said, ‘during COVID social distancing I realized I preferred smaller social gatherings at home or at friends’ place.’”
Not only are vacation homes seen as a potentially more pandemic-friendly way to travel and socialize, but they can also serve as an extended home-away-from-home. With more Americans being given the option to continue working remotely or retire earlier than expected, vacation homes can be used year-round. The NAHB <a href="https://eyeonhousing.org/2020/12/second-home-markets-show-construction-growth/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Remote work arrangements have made it possible for some wealthier Americans to move to alternate locations that are not just small, suburban shifts from within their current metro area. More fundamentally, second home demand may also be benefitting by an acceleration of retirement plans, as well as stock market gains.”
Bottom Line
The demand for vacation homes has increased and will continue to rise as we head into summer. If you own a house in a destination area and have thought about selling, now is a great time to take advantage of today’s high buyer interest. Let’s connect to discuss your opportunities in our local market.
2021-04-20T08:53:00-07:002021-04-19T08:54:37-07:00Missy Ashcrafttag:missyashcraft.com,2012-09-20:11223How Much Time Do You Need To Save for a Down Payment?<img width="750" height="410" src="https://files.mykcm.com/2021/04/15142744/20210419-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="How Much Time Do You Need To Save for a Down Payment? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/15142744/20210419-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/15142744/20210419-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/15142744/20210419-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
One of the biggest hurdles homebuyers face is saving for a down payment. As you’re budgeting and planning for your home purchase, you’ll want to understand how much you’ll need to put down and how long it will take you to get there. The process may actually move faster than you think.
Using <a href="https://www.huduser.gov/portal/datasets/il/il20/Medians2020r.pdf" title="data" target="_blank" rel="noopener noreferrer">data</a> from the U.S. Department of Housing and Urban Development (HUD) and <a href="https://www.apartmentlist.com/rentonomics/rental-data/" title="Apartment List" target="_blank" rel="noopener noreferrer">Apartment List</a>, we can estimate how long it might take someone earning the median income and paying the median rent to save up for a down payment on a median-priced home. Since saving for a down payment can be a great time to practice budgeting for housing costs, this estimate also uses the <a href="http://www.investopedia.com/terms/t/twenty-eight-thirty-six-rule.asp" title="concept" target="_blank" rel="noopener noreferrer">concept</a> that a household should not pay more than 28% of their total income on monthly housing expenses.
According to the data, the national average for the time it would take to save for a 10% down payment is right around two and a half years (2.53). Residents in Iowa can save for a down payment the fastest, doing so in just over one year (1.31). The map below illustrates this time (in years) for each state:<a href="https://files.simplifyingthemarket.com/2021/04/15142750/20210419-MEM-Eng-1.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97844" src="https://files.mykcm.com/2021/04/15142750/20210419-MEM-Eng-1.png" alt="How Much Time Do You Need To Save for a Down Payment? | MyKCM" width="600" height="450" /></a>
What if you only need to save 3%?
What if you’re able to take advantage of one of the 3% down payment programs available? It’s a common <a href="https://www.simplifyingthemarket.com/2021/02/03/do-i-really-need-a-20-down-payment-to-buy-a-home/?a=331387-3dd8b6c4ff189b22fb997dae41c54225" title="misconception" target="_blank" rel="noopener noreferrer">misconception</a> that you need a 20% down payment to buy a home, but there are actually more affordable options and down payment assistance programs available, especially for first-time buyers. The reality is, saving for a 3% down payment may not take several years. In fact, it could take less than a year in most states, as shown in the map below:<a href="https://files.simplifyingthemarket.com/2021/04/15142746/20210419-MEM-Eng-2.png?a=331387-3dd8b6c4ff189b22fb997dae41c54225" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97843" src="https://files.mykcm.com/2021/04/15142746/20210419-MEM-Eng-2.png" alt="How Much Time Do You Need To Save for a Down Payment? | MyKCM" width="600" height="450" /></a>
Bottom Line
Wherever you are in the process of saving for a down payment, you may be closer to your dream home than you think. Let’s connect to explore the down payment options available in our area and how they support your plans.
2021-04-19T08:52:00-07:002021-04-19T08:53:31-07:00Missy Ashcraft