ShareThisInterest Rates Still Low!
Interest rates are still fantastic! Several of my clients that settled on their properties in April received interest rates under 4 percent. Wow! What are you waiting for?
High Rentals Pushing People to Buy Homes!
With Apartment and rental properties rents climbing across the U. S., but the cost to buy a home still low, housing analysts expect to see more apartment dwellers opting to become homeowners. Over the past 90 days I had several clients looking to rent realize that it was cheaper to purchase a home instead of renting. Most of my clients that have purchased a home between June 2011 and January 2012 have received a 3.75% interest rate. With sellers being eager to sell their houses, most are willing to give a sellers’ concession. Some sellers are willing to give as high as 6% towards a buyers’ closing cost (FHA buyers’). If a buyer can come up with their 3.5% downpayment (some first-time home buyers can use grant programs towards their downpayment) and get a sellers’ concession they can become a homeowner.
I believe rents will continue to climb as more and more people who are losing their homes due to short sales and foreclosures hit the rental market. This is great for landlords but bad for renters who are finding it harder to find what use to be cheap rentals. Every week I am explaining to people looking for rentals, that the areas they desire are renting for $1,300 instead of the $900.00 they are thinking it should be. Now is the time to buy. Hoping to save by delaying the purchase of a home may result in higher housing costs while you’re waiting, thus achieving the exact opposite result. It will become that much harder to save the required down payment amount, even for low-down payment programs like FHA, if the percentage of your income getting eat up by rent continues it’s upward climb.
House Shopping is Not A Job!
I’ve been ask this questions many times, “how many houses should I view consecutively.” There is no set rule, but I can give you some advise that might be helpful. If you look at 5 houses and you begin to lose focus and energy you should stop looking. This could cause you to miss some important features or visible problems in a property. You can always view more properties the next day or when you can focus better. Most people don’t buy the first house they view, so you should not cram a lot of houses consecutively to tour in one day. My wife will email clients 10-20 properties and some times they want to view most of them at one time. I notice that after 5 properties some clients will begin to lose focus and energy. You shouldn’t make house shopping a job. You should view as many houses as you can enjoy to see. You also should take plenty of notes so you can compare property features you like. I believe this will help you to have a better home shopping experience.
World Population is Projected to hit 7 Billions by Monday Oct. 31st!
Sometime on Monday October 31, 2011 the world population is projected to hit 7 billion. By 2050 the world population is projected to be 10.5 billion. Very interesting!
World population by the billions
1 billion – 1804
2 billion – 1927
3 billion – 1959
4 billion – 1974
5 billion – 1987
6 billion – 1999*
7 billion – 2011
*Year when the milestone was observed by the United Nations.
Source: United Nations Population Fund
Free eBook “10 Mistakes Home Buyers Make!”
Many potential home buyers have downloaded my free eBook “10 Mistakes Home Buyers Make” and have told me how it saved them money on their home purchase. Here is the list of 10 mistakes you should avoid. Download the eBook, its free (you need Adobe Reader) and it could save you money also. I look forward to your feedback. Do not hesitate to contact me with any questions.
1. Not Doing Your Homework
2. Previewing Houses Before Pre-Approval
3. Accepting Verbal Estimates
4. Skipping the Pre-Approval Process
5. Writing A Contract Before All Decision Makers Have Seen The House
6. Purchasing A Home Without Representation
7. Waiving Your Home Inspection
8. Using The Wrong Home Inspector
9. Only Getting A Quote From One Homeowners Insurance Company
10. Forgoing Owner’s Title Insurance
Homeownership Beats Renting in 3 Out of 4 U.S. Cities!
Trulia examined the cost of renting versus buying in America’s 50 largest cities and found that buying is more affordable in 72% of major cities. Three reasons buying a home has become more affordable in 72% of major cities than renting . 1. Rental prices have increased. The rental market has become flooded with homeowners who have lost their homes because of foreclosure and short sales. 2. Home prices have decreased back to 2005 prices. 3. Low interest rates. With this combination homeownership has become more affordable in a lot of areas. That is why now is a good time to buy!
Home Buyer Seminar With Harbel Housing Partnership!
I will be presenting for Harbel Housing Partnership tomorrow October 6th at the Towson Library from 6:00pm- 9:00pm. Harbel is a great non-profit housing counseling organization that educate first-time home buyers. I’ve been presenting for them for 8 years. If you would like to attend one of their workshops please give me a call at 410-977-7176 for more information.
How Much Earnest Money Deposit Do You Need!
I normally recommend that a buyer put no more than 1% earnest money deposit down when submitting an offer. If the offer price is $200,000, than the earnest money deposit should be $2,000. This is my rule of thumb, there is no set amount. My responsibility is to limit my buyers’ financial exposure. When an offer has been accepted the earnest money deposit check is put in my or the listing agent escrow account. The only way the earnest money can be released from escrow is 1. The buyer settles on the property. 2. The buyer and seller signs a written release stating whom receives the deposit. 3. If their is a dispute between the buyer and seller and the Broker feels the buyer was not at fault and sends out a Broker letter to the seller explaining why the money should be released to the buyer and the seller doesn’t respond to the letter in 30 days the Broker can release the earnest money deposit to the buyer. 4. Court order.
I do not recommend that a buyer put a very large earnest money deposit with an offer (unless you are purchasing a high price property) because a dispute between a buyer and seller can cause a delay in the buyer getting their earnest money deposit back quickly. If a buyer writes a $5,000 earnest money check and have to fight to get it released it could take months and that can affect their ability to purchase another property immediately.
Have You Heard Interest Rates as Low as 3.5%!
I thought interest rates would be around 5% towards the end of 2011 and heading towards 6%. I am glad to see I was wrong. Because of the lack luster growth with the economy, and low consumer confidence, interest rates have been kept low.This is a good thing for potential buyers. Would you rather finance $200,000 at a 5% interest rate or 3.5%? The difference is $169.41 in mortgage payments each month. Did you know that the lower your interest rate the more buying power you have. This can help you purchase in the neighborhood you desire.
In my 15 years of being a real estate professional I’ve notice that some buyers want to purchase a home in neighborhoods that are out of their financial comfort zone or buying power. Now is a good time to take advantage of the lower interest rates. This is one way to increase your buying power!
HUD Income Guidelines for Baltimore County MALP and SELP, Baltimore City CDBG, and Federal Home Loan Bank’s FHP
Below is the new HUD income guidelines for Baltimore County MALP, SELP, Baltimore City CDBG, and Federal Home Loan Bank’s FHP effective July 13, 2011.
80% Income
1 Person $44,950
2 Person $51,400
3 Person $57,800
4 Person $64,200
5 Person $69,350
6 Person $74,500
7 Person $79,650
8 Person $84,750
Contact me for more detailed information on each of the programs.
