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Questions continue to rise around where home prices will head in 2020. The latest forecast from CoreLogic shows continued appreciation at 5.4% over the next year:
Additionally, ARCH Mortgage Insurance Company in their current Housing and Mortgage Market Review revealed their latest ARCH Risk Index, which estimates the probability of home prices being lower in two years. Based on the most recent results, 32 of the 50 U.S. states (plus D.C.) had a minimal probability of lowering by 2021.

Bottom Line

Experts forecast home price appreciation to continue at a moderate rate as we move through 2020 and beyond. With appreciation growing, let’s get together and plan for your next move.

Source: KCM

Some Highlights:

• Interest rates will be lower than they have been since before 1980 at 3.8% and are projected to remain steady throughout 2020!
• According to CoreLogic, home prices will appreciate at a rate of 5.4% over the course of the year.
• Experts predict that the number of homes sold next year will be equal to or outpace 2019.

Source: KCM

Studies have shown that, in many cases, the largest asset a family owns is the house they live in. Over the last twelve months, that asset has gained substantial value.

CoreLogic just released their 2019 3rd Quarter Homeowner Equity Insights Report. The report revealed that:

“U.S. homeowners with mortgages (roughly 64% of all properties) have seen their equity increase by a total of nearly $457 billion since the third quarter 2018, an increase of 5.1%, year over year.”

The equity in a property is determined by comparing the current value of the property against the outstanding mortgage debt. As prices rise, the equity in a home increases.

The report went on to explain that the average homeowner gain in equity over the last twelve months was $5,300.

Here’s a map showing the average equity gain by state:Since the housing crash in 2008, many homeowners have felt trapped in their current houses, as they didn’t have enough equity to sell. The gains in equity over the past few years may have freed some homeowners who have a desire to move.

Bottom Line

If you’re curious about your home’s equity, let’s get together to do a market analysis on the current value of your house. You may be pleasantly surprised.

Source: KCM

This coming year the housing market will be defined by 3 things- inventory, interest rates, and appreciation.  But the biggest issue the housing market will face in 2020 is an inventory shortage.  There aren’t enough homes on the market for buyers, especially on the lower end of the market. This is a topic that has come up frequently within the past several months.

Based on what is forecasted, we know that interest rates are projected to remain low and that appreciation is expected to continue as we move into 2020.  Additionally, the upcoming election will provoke many unique perspectives on the health of the US housing market. The challenge will be understanding what is actually happening and how you can best position yourself if you are thinking of buying or selling your home.

Here are several perspectives to consider on the inventory issue facing housing next year:

According to realtor.com:

“Despite increases in new construction, next year will once again fail to bring a solution to the inventory shortage that has plagued the housing market since 2015. Inventory could reach a historic low as a steady flow of demand, especially for entry level homes, and declining seller sentiment combine to keep a lid on sales transactions.”

Diana Olick at CNBC:

“Inventory has been falling annually for five straight months, after it recovered slightly toward the end of last year, due to a spike in mortgage rates. Rates began falling again by spring of this year. Homebuilders have been increasing production slowly, but it’s not enough to meet the increasingly strong demand.”

George Ratiu, Senior Economist with realtor.com

“As millennials — the largest cohort of buyers in U.S. history — embrace homeownership and take advantage of this year’s unexpectedly low mortgage rates, demand is outstripping supply, causing inventory to vanish. The housing shortage is felt acutely at the entry-level of the market, where most millennials are looking to break into the market for their first home.”

Bottom Line

The most important thing you can do is understand what is happening in your local market. You may not be able to avoid some of the issues brought on by low inventory, but you can be educated and prepared. Let’s connect and discuss the options that make the most sense for you and your family.

Source: KCM

It’s exciting to put a house on the market and to think about making new memories in new spaces, but we can have deep sentimental attachments to the homes we’re leaving behind, too. Growing emotions can help or hinder a sale, depending on how we manage them.

When it comes to the bottom line, homeowners need to know what it takes to avoid costly mistakes. Being mindful of these things and prepared for the process can help you avoid some of the most common mishaps when selling your house.

1. Overpricing Your Home

When inventory is low, like it is in the current market, it’s common to think buyers will pay whatever we ask for when we price our homes. Believe it or not, that’s far from the truth. Don’t forget that the buyer’s bank will send an appraisal to determine the fair value for your home. The bank will not lend more than what the house is worth, so be mindful that you might need to renegotiate the price after the appraisal. A real estate professional will help you to set the true value of your home.

2. Letting Your Emotions Interfere with the Sale

Today, most homeowners have been living in their houses for an average of 10 years (as shown in the graph below):This is several years longer than what used to be the norm, since many homeowners have been recouping from negative equity situations over the past 10 years. The side effect, however, is when you live for so long in one place, you may get even more emotionally attached to your space. If it’s the first home you bought after you got married 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 the sentimental value.

For some homeowners, that makes it even harder to negotiate, separating the emotional value of the home from the fair market price. That’s why you need a real estate professional to help you with the negotiations in the process.

3. Not Staging Your Home

We’re generally quite proud of our décor and how we’ve customized our houses to make them our own personalized homes, but not all buyers will feel the same way about your design. That’s why it’s so important to make sure you stage your home with the buyer in mind. Buyers want to envision themselves in the space, so it truly feels like their own. They need to see themselves in the space with their furniture and keepsakes – not your pictures and decorations. Stage and declutter your home so they can visualize their own dreams as they walk through your house. A real estate professional can help you with tips to get your home ready to stage and sell.

Bottom Line

Today’s seller’s market might be your best chance to make a move. If you’re considering selling your house, let’s get together to help you navigate through the process while avoiding common seller mistakes.

Source: KCM

The reality of what we’re seeing this month is that homes are selling fast. In today’s strong seller’s market, bidding wars are common and expected with starter or entry-level homes.

In most areas of the country, first-time buyers have been met with fierce competition throughout their homebuying experience. Some have been out-bid multiple times before finally going into contract on a home to call their own.

Right now, inventory is the big challenge. Here’s what we know today:

According to the latest Existing Home Sales Report from the National Association of Realtors (NAR), there is currently a 3.9-month supply of homes for sale, which can drive this kind of hefty buyer competition. Remember, anything less than 6 months of inventory is a seller’s market.

Even though the month’s supply of inventory is not increasing, ironically, the number of homes for sale is. This means homes are coming up for sale, but they’re being sold quickly. The graph below shows the year-over-year change in inventory over the last 12 months.As depicted above, the percentage of available inventory has fallen for four consecutive months when compared to the previous year.

So, what does this mean? If you’re a buyer, be sure to get pre-approved for a mortgage and be ready to make a competitive offer, so you can move quickly. Chances are, homes high on your wish list are likely going to go fast.

Bottom Line

If you’re thinking of buying a home, make sure you’re taking the right steps at the beginning of the process, so you’re a top contender if you ultimately find yourself in a bidding war. Let’s get together to discuss what you need to do to make your move toward homeownership.

Source: KCM

Some Highlights

• Winter is a great time to list a house, since inventory is traditionally low, and most sellers are holding off until spring to put their homes on the market.
• Waiting for warmer weather when more competition is on the market will only put your house up against many more choices for buyers.
• Get your house ready to sell now with quick and easy fixes that make a big impact.

Source: KCM

Black Friday is behind us and holiday gifts are flying off the shelves in stores and online. Unlike last year, however, there’s another type of buyer that is very active this winter – the homebuyer.

Each month, ShowingTime releases their Showing Index, which tracks the average number of appointments received on active U.S. house listings. The latest index revealed:

“Traffic was more active once again compared to 2018, as the nation saw its third straight month of higher year-over-year showing activity…The 5.5% increase in showings nationwide was the largest jump in activity during the now three-month streak of year-over-year increases vs. 2018.”

The same report indicates showings increased in every region of the country:

• The South increased by 10.8%
• The West increased by 8.6%
• The Northeast increased by 3.8%
• The Midwest increased by 1.5%

Why is the traffic more active?

One of the main reasons buyer traffic has increased year-over-year is that mortgage rates have fallen dramatically. According to Freddie Mac, the average mortgage rate last December was 4.64%. Today, the rate is almost a full percentage point lower!

Bottom Line

There are first-time, move-up, and move-down buyers actively looking for the home of their dreams this winter. If you’re thinking of selling your house in 2020, you don’t need to wait until the spring to do it. Your potential buyer may be searching for a home in your neighborhood right now.

Source: KCM

It may seem hard to imagine that the home you’re in today – whether it’s your starter home or just one you’ve fallen in love with along the way – might not be your forever home.

The good news is, it’s okay to admit if your house no longer fits your needs.

According to the latest Home Price Insights from CoreLogic, prices have appreciated 3.5% year-over-year. At the same time, the National Association of Realtors (NAR) reports inventory has dropped 4.3% from one year ago.These two statistics are directly related to one another. As inventory has decreased and demand has increased, prices have been driven up.

This is great news if you own a home and are thinking about selling. The equity in your house has likely risen as prices have increased. Even better is the fact that there’s a large pool of buyers out there searching for the American dream, and your home may be high on their wish list.

Bottom Line

If you think you’ve outgrown your home, let’s get together to discuss local market conditions and determine if now is the best time for you to sell.

Source: KCM

Over the past year, mortgage rates have fallen more than a full percentage point. This is a great driver for homeownership, as today’s low rates provide consumers with some significant benefits. Here’s a look at three of them:

1. Refinance: If you already own a home, you may want to decide if you’re going to refinance. It’s one way to lock in a lower monthly payment and save substantially over time, but it also means paying upfront closing costs too. You have to answer the question: Should I refinance my home?
2. Move-up or Downsize: Another option is to consider moving into a new home, putting the equity you’ve likely gained in your current house toward a down payment on a new one that better meets your needs – something that’s truly a perfect fit for your family.
3. Become a First-Time Homebuyer: There are many financial and non-financial benefits to owning a home, and the most important thing is to first decide when the time is right for you. You have to determine that on your own, but know that now is a great time to buy if you’re considering it. Just take a look at the cost of renting vs. buying

Why 2019 Was a Great Year for Homeownership

Last year at this time, mortgage rates were 4.63% (substantially higher than they are today). If you’re one who waited for a better time to make a move, market conditions have improved significantly. Today’s low mortgage rates combined with increasing wages are making homes much more affordable than they were just one year ago, so it’s a great time to get more for your money and consider a new home.

The chart below shows how much you would save based on today’s rates, compared to what you would have paid if you purchased a house exactly one year ago, depending on how much you finance.

Bottom Line

If you’ve been waiting since last year to make your move into homeownership, or to find a house that better meets your needs, today’s low mortgage rates may be just what you need to get the process going. Let’s get together to discuss how you can benefit from the current rates.

Source: KCM