I get asked all the time "which home remodeling projects will benefit me most?" Well, we have the answer for you according to the Remodeling 2019 Cost vs. Value Report (www.costvsvalue.com). Things have changed a little as you can see by the chart below. Kitchen and master bedroom upgrades aren't returning quite as much as they used to, however, outdoor work is up. Things like garage doors and stone veneer on the exterior of your home.
What WIll 2019 Bring?
Heading into 2019 I'm getting a lot of questions about what I think will happen to the housing market. One of the biggest questions I get from a lot of people is about the Fed raising interest rates because that does affect mortgage rates. Will this affect my ability to buy? Will there be enough inventory to shop for my new house? All legitimate questions to be sure. Here are a few facts to keep in mind for the upcoming year:
- Interest rates are projected to increase steadily throughout 2019, but buyers will still be able to lock in a rate lower than their parents or grandparents did when they bought their homes! (I bought my first home in 1987 and was pumped that the interest rate had just DROPPED to a flat 10%!!!)
- Home prices will rise at a rate of 4.8% over the course of 2019 according to CoreLogic.
- All four major reporting agencies believe that home sales will outpace 2018!
And if you're renting and hoping to buy a home but are worried about the rising interest rates consider this. According to the 2018 Bank of America Homebuyer Insights Report, 74% of renters plan on buying in the next 5 years, with 38% planning to buy in the next 2 years! Why? Two reasons according to this survey - 1. 52% said that rising rental costs were their top reason, and 2. over 40% of renters believe that their rent will rise every year. So really there is one reason - higher rental rates. Not just higher rates but no return on your investment. Paying rent is like helping your landlord buy his new boat...he benefits from your investment, you don't.
So when looking at the big picture, buying is still better than renting and even with the "big bad interest rate hikes" you will still be able to go after your dream home in 2019.
Step One Of Home Buying
Thinking of buying a home? Now’s a great time! Especially as interest rates continue to rise, the sooner you get locked in on a mortgage rate, the better. Here in the Atlanta area, the number of buyers searching for their dream home far exceeds the number of homes for sale. When this happen, the marketplace becomes very competitive. Simple supply and demand fundamentals, really. Which is why 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.
I talk with folks all the time who are ready to buy, and my first question is always “have you been pre-approved or pre-qualified for a loan?” I’m always surprised at how many haven’t been. This is always step one in the home buying process, especially for first time home buyers. Getting pre-approved or pre-qualified does two things:
- Let’s us know how much home we should be searching for. I always tell people, we all have diamond taste but most of us live on cubic zirconia budget, right?
- Most importantly when it comes time to make an offer on your dream home, having your financing together, hopefully, moves you to the top of the list for the sellers.
We have great relationships with our lenders who will be able to help you through this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information a lot of times about your history regarding credit, debt, work history and that sort of thing.
In a nutshell, here’s what determines the amount you will be able to borrow, according to Freddie Mac. It’s known as the ‘4 Cs’:
- Capacity: Your current and future ability to make your payments
- Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
- Collateral: The home, or type of home, that you would like to purchase
- Credit: Your history of paying bills and other debts on time
Bottom Line? Many potential homebuyers overestimate how much they’ll need for a down payment and they think their credit score may not be good enough. Working with a lender, you may be surprised at what your numbers really are.
Fall Is Here
Even though it still feels like summer, it's not too early to start going over your fall to-do list. Our friends at First American Home Warranty have helped us put together this list of things to get this done this fall to keep your home in shape as we enter cooler weather. Feel free to print this and stick it on your 'fridge and refer to when you're in the mood.
Time For Us To Downsize?
My wife and I were talking the other day about downsizing our home and how we've been trying for years. We are part of the baby boomer generation that is also becoming known as the "sandwich generation". The what? Well, I'm glad you asked.
How Your Credit Score Is Figured
When it comes time to make a major purchase of any kind whether it's buying a car or a house, one of the first things we think about is our credit score. You can't watch tv or surf the web these days without seeing an ad for checking your credit score, right?
We all know what our number is but...do we know how that number gets figured?