Things to Avoid after Applying for a Mortgage [INFOGRAPHIC]

Reasons to Hire a Real Estate Professional [INFOGRAPHIC] | Simplifying The Market

Things to Avoid after Applying for a Mortgage [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • There are a few key things to make sure you avoid after applying for a mortgage to help make sure you still qualify for your loan at the closing table.
  • Along the way, be sure to discuss any changes in income, assets, or credit with your lender, so you don’t unintentionally jeopardize your application.
  • The best plan is to fully disclose your intentions with your lender before you do anything financial in nature.

4 Reasons People Are Buying Homes in 2021

4 Reasons People Are Buying Homes in 2021 | Simplifying The Market

According to many experts, the real estate market is expected to continue growing in 2021, and it’s largely driven by the lasting impact the pandemic is having on our lifestyles. As many of us spend extra time at home, we’re reevaluating what “home” means and what we may need in one going forward.

Here are 4 reasons people are reconsidering where they live and why they’re expecting to buy a home this year. 

1. Record-Low Mortgage Interest Rates

In 2020, the average interest rate for a 30-year fixed mortgage hit a record low 16 times, continuing to fall further below 3%. According to Freddie Mac, the average 30-year fixed interest rate today is 2.65%. Many wonder how low these rates will go and how long they’ll last. Len Keifer, Deputy Chief Economist for Freddie Mac, advises:

“If you’ve found a home that fits your needs at a price you can afford, it might be better to act now rather than wait for future rate declines that may never come and a future that likely holds very tight inventory.”

This sense of urgency is driving many to buy this year.

2. Working from Home

Remote work is a new normal for many businesses, and it’s lasting longer than most expected. Many in the workforce today are discovering they don’t need to live close to the office anymore and they can get more for their money by moving a little further outside of the city limits. David Mele, President at Homes.com, says: 

“The surge in the work-from-home population has rewritten the playbook for many homebuying and rental decisions, from when and where to relocate, to what people are looking for in their next residence.”

The reality is, for some people, working remotely in their current home is challenging, especially when there may be other options available.

3. More Outdoor Space

Another new priority for homeowners is having more usable outdoor space. Being at home is driving those in some areas to seek less densely populated neighborhoods so they have more room to stretch their legs. In addition, those living in apartments and townhomes are often looking for extra square footage, both inside and out.

According to the State of Home Spending report by HomeAdvisor, of the households surveyed, almost half reported spending 27% more on outdoor living over the past year. This is a trend that’s expected to grow in 2021 and beyond.

4. Avoiding Renovations

It’s recently come to light that many homeowners would also rather buy a new home than go through the process of fixing up the one they have. According to the 2020 Profile of Home Buyers and Sellers report from the National Association of Realtors (NAR), 44% of homebuyers purchased a new home to “avoid renovations or problems with the plumbing or electricity.”

Depending on what needs to be addressed, today’s high buyer demand may make it possible to skip some renovations before selling. Many of these homeowners have prioritized buying over renovating for convenience and potential cost savings.

Bottom Line

It’s clear that homeownership needs are changing. As a result, Americans are expected to move in record numbers this year. If you’re trying to decide if now is the right time to buy a home, let’s connect today to discuss your options.

What Does 2021 Have in Store for Home Values?

What Does 2021 Have in Store for Home Values? | Simplifying The Market

According to the latest CoreLogic Home Price Insights Report, nationwide home values increased by 8.2% over the last twelve months. The dramatic rise was brought about as the inventory of homes for sale reached historic lows at the same time buyer demand was buoyed by record-low mortgage rates. As CoreLogic explained:

“Home price growth remained consistently elevated throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of for-sale homes has dwindled as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market.

While the pandemic left many in positions of financial insecurity, those who maintained employment and income stability are also incentivized to buy given the record-low mortgage rates available; this is increasing buyer demand while for-sale inventory is in short supply.”

Where will home values go in 2021?

Home price appreciation in 2021 will continue to be determined by this imbalance of supply and demand. If supply remains low and demand is high, prices will continue to increase.

Housing Supply

According to the National Association of Realtors (NAR), the current number of single-family homes for sale is 1,080,000. At the same time last year, that number stood at 1,450,000. We are entering 2021 with approximately 370,000 fewer homes for sale than there were one year ago.

However, there is some speculation that the inventory crush will ease somewhat as we move through the new year for two reasons:

1. As the health crisis eases, more homeowners will be comfortable putting their houses on the market.

2. Some households impacted financially by the pandemic will be forced to sell.

Housing Demand

Low mortgage rates have driven buyer demand over the last twelve months. According to Freddie Mac, rates stood at 3.72% at the beginning of 2020. Today, we’re starting 2021 with rates one full percentage point lower than that. Low rates create a great opportunity for homebuyers, which is one reason why demand is expected to remain high throughout the new year.

Taking into consideration these projections on housing supply and demand, real estate analysts forecast homes will continue to appreciate in 2021, but that appreciation may be at a steadier pace than last year. Here are their forecasts:What Does 2021 Have in Store for Home Values? | Simplifying The Market

Bottom Line

There’s still a very limited number of homes for sale for the great number of purchasers looking to buy them. As a result, the concept of “supply and demand” mandates that home values in the country will continue to appreciate.

Reasons to Hire a Real Estate Professional [INFOGRAPHIC]

Reasons to Hire a Real Estate Professional [INFOGRAPHIC] | Simplifying The Market

Reasons to Hire a Real Estate Professional [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • Choosing the right real estate professional to work with is one of the most important decisions you can make in your homebuying or selling process.
  • The right agent can explain current market conditions and break down exactly what they mean for you.
  • If you’re considering buying or selling a home this year, let’s connect so you can work with someone who has the experience to answer all of your questions about pricing, contracts, negotiations, and more.

Is This the Year to Sell My House?

Is This the Year to Sell My House? | Simplifying The Market

If one of the questions you’re asking yourself is, “Should I sell my house this year?” consumer sentiment about selling today should boost your confidence in the right direction. Even with the current health crisis that continues to challenge our nation, Americans still feel good about selling a house. Here’s why.

According to the latest Home Purchase Sentiment Index from Fannie Mae, 57% of consumer respondents to their survey indicate now is a good time to buy a home, while 59% feel it’s a good time to sell one:

“The percentage of respondents who say it is a good time to sell a home remained the same at 59%, while the percentage who say it’s a bad time to sell decreased from 35% to 33%. As a result, the net share of those who say it is a good time to sell increased 2 percentage points month over month.”

As you can see, many still believe that, despite everything going on in the world, it is still a good time to sell a house.

Why is now a good time to sell?

There simply are not enough homes available to meet today’s buyer demand, and they’re selling just as quickly as they’re coming to the market. According to the National Association of Realtors (NAR), unsold inventory available today sits at a 2.3-month supply at the current sales pace, which is down from a 2.5-month supply from the previous month. This record-low inventory is not even half of what we need for a normal or neutral housing market, which should have a 6.0-month supply of unsold inventory to balance out.

With so few homes available for buyers to choose from, we’re in a true sellers’ market. Homeowners ready to make a move right now have the opportunity to negotiate the best possible contracts with buyers who are feeling the pull of intense competition when it comes to finding their dream home. Lawrence Yun, Chief Economist for NAR, notes how quickly homes are selling right now, further confirming the benefits to sellers this season:

“The market is incredibly swift this winter with the listed homes going under contract on average at less than a month due to a backlog of buyers wanting to take advantage of record-low mortgage rates.”

However, this sweet spot for sellers won’t last forever. As more homes are listed this year, this tip toward sellers may start to wane. According to Danielle Hale, Chief Economist at realtor.com, more choices for buyers are on the not-too-distant horizon:

“The bright spot for buyers is that more homes are likely to become available in the last six months of 2021. That should give folks more options to choose from and take away some of their urgency. With a larger selection, buyers may not be forced to make a decision in mere hours and will have more time to make up their minds.”

Bottom Line

If you’re ready to make a move, you can feel good about the current sentiment in the market and the advantageous conditions for today’s sellers. Let’s connect today to determine the best next step when it comes to selling your house this year.

Why Not to Wait Until Spring to Make a Move

Why Not to Wait Until Spring to Make a Move | Simplifying The Market

The housing market recovery coming into the new year has been nothing short of remarkable. Many experts agree the turnaround from the nation’s economic pause is playing out extremely well for real estate, and the current market conditions are truly making this winter an ideal time to make a move. Here’s a dive into some of the biggest wins for homebuyers this season.

1. Mortgage Rates Are Historically Low

In 2020, mortgage rates hit all-time lows 16 times. Continued low rates have set buyers up for significant long-term gains. In fact, realtor.com notes:

“Given this means homes could cost potentially tens of thousands less over the lifetime of the loan.”

Essentially, it’s less expensive to borrow money for a home loan today than it has been in years past. Although mortgage rates are expected to remain relatively low in 2021, even the slightest increase can make a big difference in your payments over the lifetime of a home loan. So, this is a huge opportunity to capitalize on right now before mortgage rates start to rise.

2. Equity Is Growing

According to John Burns Consulting, 58.7% of homes in the U.S. have at least 60% equity, and 42.1% of all homes in this country are mortgage-free, meaning they’re owned free and clear.

In addition, CoreLogic notes the average equity homeowners gained since last year is $17,000. That’s a tremendous amount of forced savings for homeowners, and an opportunity to use this increasing equity to make a move into a home that fits your changing needs this season.

3. Home Prices Are Appreciating

According to leading experts, home prices are forecasted to continue appreciating. Today, many experts are projecting more moderate home price growth than last year, but still moving in an upward direction through 2021.

Knowing home values are increasing while mortgage rates are so low should help you feel confident that buying a home before prices rise even higher is a strong long-term investment.

4. There Are Not Enough Homes for Sale

With today’s low inventory of homes on the market, which is contributing to this home price appreciation, sellers are in the driver’s seat. The competition is high among buyers, so homes are selling quickly.

Making a move while so many buyers are looking for homes to purchase may mean your house rises to the top of the buyer pool. Selling your house before more listings come to the market in the traditionally busy spring market might be your best chance to shine.

Bottom Line

If you’re considering making a move, this may be your moment, especially with today’s low mortgage rates and limited inventory. Let’s connect to get you set up for homebuying success in the new year.