The real truth is that real estate when bought and sold correctly is one of the best investments anyone can make. Down through all the years real estate has always been the measure of wealth. Today with incentives people who had has troubles are now getting back in the market. People who have had their last child move off after graduating are considering downsizing. Younger people who have lived with their parents after school as they start off on the careers and get their own college debt-load under control are also coming back into the market. There is a great deal of choice and option. To get your questions answered you never have to be our client. Over the next five years, home prices are expected to appreciate 3.64% per year on average and to grow by 18.4% cumulatively, according to Pulsenomics’ most recent Home Price Expectation Survey.
This isn't Zillow, this is science. The best minds take a survey and their active and engaged professional minds from all sectors of our country deliver an index. This index is both a look back at what has happened and it suggests the ways the trends are moving. In any statistical analysis there is room for interpretation. Today, it makes sense to look to actual expert economists, real estate experts (people who are top producers), investment and marketing strategists to understand their thoughts to help you make your own mind up about your individual situation. All real estate is local and each neighborhood will have it's own statistics. Look to a professional to assist you to understand what is going on in your neighborhood. Call us at 617-774-8292 to get some accurate information, you don't ever have to be our client to get a better handle on your own situation. Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey. Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts, and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.
The results of their latest survey:Home values will appreciate by 5.0% over the course of 2017, 4.0% in 2018, 3.2% in 2019, 3.0% in 2020, and 3.0% in 2021. That means the average annual appreciation will be 3.64% over the next 5 years. The prediction for cumulative appreciation increased from 17.8% to 18.4% by 2021. The experts making up the most bearish quartile of the survey are projecting a cumulative appreciation of 6.7%.
Bottom LineIndividual opinions make headlines. We believe this survey is a fairer depiction of future values. Understanding your own neighborhood is best handled by a professional in your area. You never have to be a client of ours to get straight answers to any of your real estate questions. YourStories Realty, It's all about you.
Credit scores are just one of the criteria banks and lenders look to to determine your qualifications for a purchase. There are other views as well and it all boils down to the algorhythm they use to determine your debt to income ratio. DTI (Debt to Income) is the critical number. Credit numbers can be manipulated by factors not generally understood by all. Too many cards, paying just your minimums, not having two thirds of the credit available to you are just 3 ways you are dinged. Knowing these rules help your credit, the banks know and can tell why you might not be at a higher level and they will discount the number's meaning for your personal ability to pay. The results of countless studies have shown that potential home buyers, and even current homeowners, have an inflated view of what is really required to qualify for a mortgage in today’s market. One such study by the Wharton School of Business at the University of Pennsylvania revealed that many millennials have not yet considered purchasing homes simply because they don’t believe they can qualify for a mortgage. A recent article about millennials by Realtor.com explained that:
“About 72% of aspiring millennial buyers said they’re waiting because they can’t afford to buy…”The article also explained that 29% of millennials believe their credit scores are too low to buy.The problem here is the fact that they think they will be denied a mortgage is keeping them from even attempting to apply. Ellie Mae’s Vice President Jonas Moe encouraged buyers to know their options before assuming that they won’t qualify for a mortgage:
“Many potential home buyers are ‘disqualifying’ themselves. You don’t need a 750 FICO® Score and a 20% down payment to buy.”
So, what credit score is necessary?Below is a breakdown of the FICO® Score distribution of all closed (approved) loans in July from Ellie Mae’s latest Origination Report. Over 52% of all approved loans had a FICO® Score under 750. Many potential home buyers believe that they need a score over 780 to qualify.
Bottom LineIf owning a home of your own has always been your dream and you are ready and willing to buy, or if you are a homeowner who wants to move up, find out if you are able to! Let’s get together to determine if your dreams can become a reality sooner than you thought!
Every three years, the Federal Reserve conducts their Survey of Consumer Finances in which they collect data across all economic and social groups. The latest survey, which includes data from 2010-2013, reports that a homeowner’s net worth is 36 times greater than that of a renter ($194,500 vs. $5,400). The latest survey data, covering 2014-2016 will be released later this year. In the meantime, Lawrence Yun, the National Association of Realtors’ Chief Economist estimates that the gap has widened even further, to 45 times greater ($225,000 vs. $5,000)!
Put Your Housing Cost to Work for YouAs we’ve said before, simply put, homeownership is a form of ‘forced savings.’ Every time you pay your mortgage, you are contributing to your net worth. Every time you pay your rent, you are contributing to your landlord’s net worth. The latest National Housing Pulse Survey from NAR reveals that 84% of consumers believe that purchasing a home is a good financial decision. William E. Brown comments:
“Despite the growing concern over affordable housing, this survey makes it clear that a strong majority still believe in homeownership and aspire to own a home of their own. Building equity, wanting a stable and safe environment, and having the freedom to choose their neighborhood remain the top reasons to own a home.”
Bottom LineIf you are interested in finding out if you could put your housing cost to work for you by purchasing a home, let’s get together and evaluate your ability to buy today!
Recent headlines exclaimed the homeownership rate, as reported by the Census Bureau, rose again in the second quarter of 2017. What didn’t get much attention in the reports is that the homeownership rate for American households under the age of 35 increased a full percentage point from last quarter’s 34.3% to 35.3%. Millennials proved to have the highest increase of any age group. This came as a surprise to some considering Millennials have come to be known as the “renter” generation. However, a new study by First American, 6 Trends Poised to Reshape Homeownership Demand, revealed reasons why homeownership numbers will continue to increase for Millennials.
Millennials are the most educated generation in the U.S.Why does that matter? First American explains:
“Our model shows that, all other factors being equal, the likelihood of homeownership increases by 3 percent for those that earn a bachelor’s degree over those with a high school degree. The likelihood of homeownership jumps another 3 percent for those that earn a graduate degree.”The more educated, the better the likelihood for homeownership. And, as we mentioned: Millennials are the most educated generation in the U.S.
Homes & marriage go togetherMarriage is a key determinate in homeownership. According to an analysis by First American, the homeownership rate is 30% higher among married couples compared to non-married households. Millennials have put off marriage in the pursuit of higher education. As this group ages, more and more will marry and purchase a home.
Parents buy housesAccording to the study:
“The homeownership rate is 1.7% higher for households with one or two children compared to households with no children, and it is 5.4 percent higher for households with three or more children.”The report goes on to say that as Millennials grow older there may be an increase in not just marriage but also in married couples with children. That will probably also create a “corresponding” increase in homeownership demand.
Wages and the economyThe study goes on to explain that recent gains in income growth and a strengthening economy will also help all generations (including Millennials) be more willing and able to purchase a new home.
Bottom LineWe guess the time has come to announce – Here come the Millennials!!
There are many benefits to homeownership. One of the top benefits is being able to protect yourself from rising rents by locking in your housing cost for the life of your mortgage.
Don’t Become TrappedA recent article by ConsumerAffairs addressed the continuous rise in rents, stating:
“The cost of putting a roof over your head continues to go up. Not only are home prices still rising, but the cost of rent rose 0.5% in June.”Additionally, in the Joint Center for Housing Studies at Harvard University’s 2017 State of the Nation’s Housing Report, it was revealed that,
“Despite a slight improvement from 2014, fully one-third of US households paid more than 30 percent of their incomes for housing in 2015. Renters continue to be more likely to face cost burdens…the number of cost-burdened renters (21 million) considerably outstrips the number of cost-burdened owners (18 million) even though nearly two-thirds of US households own their homes.”These households struggle to save for a rainy day and pay other bills, including groceries and healthcare.