The Best Reasons to Buy a Home This Year!

If you’ve been thinking about purchasing a home but haven’t fully committed, read the article below from Realtor.com to see why 2019 can and should be your year to buy!


 

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Take the Plunge: The 4 Best Reasons to Buy a Home This Year

| Feb 6, 2019

The housing landscape of the past several years hasn’t exactly been friendly to buyers: the bidding wars, the eye-popping prices, the houses that sold before a “For Sale” sign even went up. It’s enough to make any of us put our search on hold until we have a fighting chance at landing a home—without draining our bank accounts.

If you’ve been sitting on the sidelines, we’ve got good news and we’ve got bad news: Things are finally slowing down. But they might not slow down fast enough for your liking.

Don’t despair, though—this year still stands to look better than last for aspiring home buyers.

“If your resolution is to buy a home in 2019, you’ll have some challenges to contend with, but also some opportunities,” says Danielle Halerealtor.com‘s chief economist.

But the devil’s in the details, and there are quite a few factors that could dictate whether this is your year to buy. Here are the four biggest reasons to take the plunge now

1. There will be more available homes—or at least, not fewer

Tight home inventory has sidelined would-be buyers for several years now. Even if you could afford a home, too few of them were hitting the market to keep up with demand. Or, when they did, there was a good chance they were snapped up before you could even call your real estate agent.

House hunting felt especially bleak last winter, when nationwide inventory hit its lowest level in recorded history. By the end of 2018, though, things finally started looking up, and in 2019, experts predict more opportunities—and less frustration—for buyers.

But there’s a catch: Not everyone will be able to afford those opportunities. That’s because the markets seeing the most increases in available homes tend to be more expensive, Hale says.

“For buyers, there is going to be more inventory. So that’s a bright spot,” she says. “The downside of that bright spot is it might not be in their price range.”

If you don’t have big bucks, though, all is not lost. The news is still good—just tempered. The supply of affordable homes for sale (under $300,000, which is about the median home price right now) might not be growing dramatically just yet, but it’s certainly not decreasing anymore.

2. Skyrocketing prices will slow their roll

While inventory went down, down, down over the past few years, home prices did the opposite. Will we still see staggering dollar amounts throughout 2019?

It’s another mixed bag here: Expect home prices to continue to rise (blah), but at a slower pace than they have been (yay). Hale predicts a 2.2% increase in home prices this year—compared with a nearly 5% increase last year.

That’s not nothin’. And if you can get in the market before those moderate increases, all the better.

“We do still anticipate rising home prices, particularly for below-median-priced homes, so buyers in that price range may have some incentive to buy sooner rather than later,” Hale says.

And there’s a silver lining to those climbing home prices, too—again, for some of you.

“As rising costs raise the bar to homeownership, some would-be buyers will be knocked out of the market, so that remaining buyers may have less competition to contend with than they saw in 2018,” Hale says.

3. Mortgage rates are lower than expected

There was a lot of discouraging talk at the end of 2018 about increasing rates—and there was good reason to be nervous. Rates on a 30-year fixed-rate mortgage, the most popular home loan, were approaching 5%—and expected to trend upward throughout 2019.

But that hasn’t happened.

In fact, rates have been falling—perplexing the pros but creating a prime opportunity for home shoppers. Rates did tick up slightly last week—for the first time in 2019—to 4.46%. But that’s still historically low.

“That’s definitely a huge opportunity for buyers because it drastically improves affordability,” Hale says. “And I think that if these low rates persist for a little while, then we’ll actually see stronger sales than we originally forecast.”

“Lower mortgage rates will get buyers off the sidelines,” adds Ali Wolf, director of economic research at Meyers Research. “Consumers should take advantage of the returned purchasing power, and in fact, we’re already seeing early 2019 data that suggest they are.”

But don’t get complacent, Hale warns: “I do think that the long-term direction of mortgage rates is going to be back up. We’ve still got a strong economy.”

4. Rents are rising—and won’t be falling anytime soon

Buying a home is a scary-expensive endeavor in the best of circumstances, and when prices are climbing, it can be downright soul-sucking.

But bear this in mind: Rents are rising, too. In fact, they very rarely decline, Hale says. And while buying a home is generally going to cost you more in the short term than renting, you have to look at the bigger picture. Buying means you’re building equity—and not forking over your hard-earned dollars to a landlord.

“The challenge will be finding a home that fits needs, some wants, and still stays within the monthly budget,” Hale says.

If you can afford to buy now, you’ll thank yourself in the long run—and whenever your friends get their annual rent increases.

Rachel Stults is a deputy editor at realtor.com covering all things real estate, including buying, selling, home decor, renting, moving, and more. Contact her at rachel.stults@move.com.

Why Getting Pre-Approved Should Be Your First Step

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In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

Even if you are in a market that is not as competitive, knowing your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.” 

Freddie Mac describes the ‘4 Cs’ that help determine the amount you will be qualified to borrow:

  1. Capacity: Your current and future ability to make your payments
  2. Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
  3. Collateral: The home, or type of home, that you would like to purchase
  4. Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so as well.

Start the process today! 

Source: https://www.keepingcurrentmatters.com/2017/12/11/why-getting-pre-approved-should-be-your-first-step-2/

Cindy Huaracha, Real Estate Broker

We are pleased to announce that a new real estate broker has joined our firm. Cindy Huaracha, has teamed with Daisy Valladares. Drop by the office and meet with Cindy! Hablo Espanol

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2018 Real Estate Predictions

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Below are predictions for the 2018 real estate market, based on data that was available at the time this was written:

Interest Rates – With the Tax Reform Bill and new infrastructure, we expect interest rates to rise. A climb to 4.0%-4.5% is probable but it is possible that if the economy grows at a good clip next year, we could see rates as high as 5%. We believe the average for the year will be about 4.6%. Although this rise will cause some buyers to regroup, it will not be enough to make a strong market shift and cause buyers to leave the market in droves.

Home Price Growth – With double-digit percentage price increases in many markets across the country in 2017, we believe we will move back to price inclines below 10% in those busy markets. In fact, it is foreseeable that the average for those areas that did see such strong increases in 2017 will scale back to about 4-7% gains in 2018. Nationally, prices are expected to increase about 3.2%. Between November 2016 and November 2017, in Whatcom County the median sales price grew by 9.8%; in our Lynden market, it grew 16.5%.

New Construction – Our country needs about 1.5 million new starts per year to maintain inventory, but since 2009 we have been short a cumulative almost 6 million units. This is one of the primary causes of our inventory shortage and what is driving prices up – demand outweighs supply. Local issues in many areas such as zoning and water rights are also capping new construction opportunity. In addition, the cost of building supplies is causing problems for our builders and we expect this problem to worsen in 2018.
Housing Inventory – Although there are improvements in this category because we are adding some new housing units, it may take years or more for inventory levels to get back to a balanced level. Additionally, it is predicted that more buyers will be entering the market for a home as our economy is strong with low unemployment, which we suspect will get even lower due to our economy. According to the Bureau of Labor Statistics, the national unemployment rate stands at 4.1% for November 2017, which is the lowest it has been since December of 2000. it is predicted unemployment to be in the high 3% range by the end of 2018.

Market Stability – we are often asked when the bubble will burst or we will see another crash. We do not foresee this in the upcoming year. Although we are seeing prices rise quickly, the conditions that our national market is facing now are not the same as what we saw just a decade ago. There isn’t the easy access to credit as there was before the last crash when banks were more de-regulated. There aren’t enough new or resale homes to satiate current demand, unlike the building boom of the mid-2000s. Buyers are not overleveraged and, in many cases, have to put more cash down to compete in multiple-offer situations, allowing buyers to start in a higher equity position. Based on our history and the facts that are in front of us, I don’t believe another crash is likely at all.

The Muljat Group North real estate office is excited for what 2018 has in store! For additional information and predictions on our local market, please call our office at 360-354-4242.

Mortgage Rates Hold Steady

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Mortgage rates were in a holding pattern this week, even after the Federal Reserve voted Wednesday to hike its benchmark interest rate.

“As widely expected, the Fed increased the federal funds target rate this week for the third time in 2017,” says Len Kiefer, Freddie Mac’s deputy chief economist. “The market had already priced in the rate hike, so long-term interest rates—including mortgage rates—hardly moved. Mortgage rates held relatively flat across the board, with the 30-year fixed mortgage rate inching down 1 basis point to 3.93 percent in this week’s survey. Mortgage rates have been in a holding pattern for the fourth quarter, remaining within a 10 basis point range since October.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Dec. 14:
•30-year fixed-rate mortgages: averaged 3.93 percent, with an average 0.5 point, dropping from last week’s 3.94 percent average. Last year at this time, 30-year rates averaged 4.16 percent.
•15-year fixed-rate mortgages: averaged 3.36 percent, with an average 0.5 point, the same as last week. A year ago, 15-year rates averaged 3.37 percent.
•5-year hybrid adjustable rate mortgages: averaged 3.36 percent, with an average 0.3 point, rising from last week’s 3.35 percent average. A year ago, 5-year ARMs averaged 3.19 percent.

Source: Freddie Mac

Whatcom County Water Rights

The Washington Supreme Court decision in Hirst et al. vs. Whatcom County, WA Sup. Ct. No. 91475-3, took away the right of rural property owners to develop small household sized wells. This case, you may recall, concerned Whatcom County’s use of exempt wells to allow construction in the unincorporated portions of Whatcom County, particularly in areas where the watershed had not been closed. The County argued that it was able to rely on the Dept. of Ecology’s determinations concerning water availability to make such decisions and to grant permits for construction where the water would be provided by an exempt well.
The Senate’s effort to save household wells was highlighted at a hearing Tuesday, February 21, 2017, before the Senate Ways and Means Committee. Property owners from Whatcom County and elsewhere said they have been devastated by the Supreme Court’s decision last fall that took away their rights to drill wells, and with it, their right to build on the land. A vote on SB 5239 is expected this week.
A hearing in Olympia makes a compelling case for household wells, property owners. Please watch the following Hearing:


Follow effort to save household wells on Washington State Senator, Doug Erickson’s, webpage: Senator Doug Erickson Webpage

Housing Market 2017

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These 3 trends will shape the housing market in 2017

1. Rates: In December, the Federal Reserve raised interest rates for only the second time since 2006, and a majority of the members of the Fed’s rate-setting board predict there will be three more increases coming in 2017.

2. More Credit: Though mortgage rates may fall, mortgage credit will likely be more widely available due to slightly looser lending standards. The Federal Housing Administration will likely lower fees it charges first-time homebuyers. In addition, starting in 2017, government-owned mortgage companies will begin backing large mortgages for the first time in over a decade, making it easier for buyers in expensive markets to finance their purchases.

3. More New Homes: The overall trend in home construction is clearly positive, with the average annual rate of new groundbreakings reaching a 1.163 million rate so far in 2016, up about 5% from 1.108 million in 2015. Expect this to continue in 2017, as home buyers are encouraged by higher wages, looser credit, and increased demand from buyers.

According to 2016 data from the Northwest Washington Multiple Listing Service the average listing price for a 3 bedroom home in Lynden was $317,3999. The average sold price for a 3 bedroom home in Lynden was $310,954 and the the average square footage: 1,835.

So will you be jumping into the 2017 marketing market? The mortgage rates are still low and if you have strong credit we encourage you to take the plunge. Really, any day is a good day to invest in real estate. Call our office and talk to a licensed and experienced, Realtor®, whether it be purchasing real estate or selling real estate. We have an onsite mortgage consultant, Casey Porter, Caliber Home Loans who would gladly answer your mortgage inquiries.

fortune.com/2016/real-estate-trends

Caliber Home Loans

We have a new on-site Loan Consultant. It’s been a welcome addition to have Casey at the office! Casey will provide you with superior and personal expert guidance throughout the home financing process.

Casey Porter, Caliber Home Loans
Tel: 360.398.5834
Mobile: 360.510.2840
Email: casey.porter@caliberhomeloans.com
Office location: 505 Front Street, downtown, Lynden
Website: Casey Porter Caliber Home Loans
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Caliber Home Loans


John Larabell, Sr. Loan Consultant
Phone: 360.398.5846
Direct: 248.982.3598
We are proud to introduce, John Larabell, as our onsite local Caliber Home Loans representative. Whether you’re purchasing or refinancing your home, John, strives to make that process easy. Contact John today to learn more about competitive rates and fees and innovative mortgage solutions provided by Caliber. For more information, please visit: CALIBER HOME LOANS – John Larabell