Century 21 Ocean Real Estate Blog

Nov. 29, 2022

What Buyers Need To Know About the Inventory of Homes Available for Sale

 

 If you’re thinking about buying a home, you’re likely trying to juggle your needs, current mortgage rates, home prices, your schedule, and more to try to decide if you want to jump into the market.

If this sounds like you, here’s one key factor that could help you with your decision: there are more homes for sale today than there were at this time last year. According to Calculated Risk, for the week ending in November 18th, there were 47.7% more homes available for sale than there were at the same time in 2021. And having more options for your home search may be exactly what you need to feel confident about making a move.

Here’s a look at where the increased housing supply is coming from so you can get a better sense of what’s happening in the market today and what it means for you.

What Caused the Growth in Housing Inventory This Year?

The increase we’ve seen in housing supply this year isn’t from the source you think it is. Rather than an influx of recent homeowners listing their houses for sale (known as new listings), the primary reason the supply has grown is that homes are staying on the market a bit longer (known as active listings).

That’s happening because higher mortgage rates and home prices have helped moderate the peak frenzy of buyer demand, which has slowed down the pace of sales. And, as the pace of sales has eased, inventory has grown as a result.

The graph below uses data from realtor.com to show that it’s active listings, not new listings, that have driven the growth we’ve seen over the past few months:

What Buyers Need To Know About the Inventory of Homes Available for Sale | MyKCM

And while overall inventory gains may slow down this winter due to typical housing market seasonality, you still have a chance to capitalize on the current supply.

What This Means for Your Home Search

Regardless of the source, the increase in available housing supply is good for buyers. More homes available for sale means you have more options to choose from as you search for your next home, and you may even have more time to consider them.

So, if you tried to buy a home last year and lost out in a bidding war or just couldn’t find something you liked, this may be the news you’ve been waiting for. If you start your search today, those additional options should make it less difficult to find a home you love, especially as some other buyers pause their search this holiday season.

Just remember, the housing supply is still low overall, so it won’t suddenly be easy – it’ll just be less challenging than it was at this time last year. As a recent article from realtor.com says:

“Despite this improvement in the number of homes actively for sale, active listings still lag their pre-pandemic levels.”

The increase in housing supply helps put you in a great position to kick off the new year in your dream home. And who better to help you find it than a trusted, local real estate professional?

Bottom Line

If you’re ready to jump into the housing market and see what’s available in our local area, let’s connect.

Nov. 29, 2022

3 Ways You Can Use Your Home Equity

 

If you’re a homeowner, odds are your equity has grown significantly over the last few years as home prices skyrocketed and you made your monthly mortgage payments. Home equity builds over time and can help you achieve certain goals. According to the latest Equity Insights Report from CoreLogic, the average borrower with a home loan has almost $300,000 in equity right now.

As you weigh your options, especially in the face of inflation and talk of a recession, it’s important to understand your assets and how you can leverage them. A real estate professional is the best resource to help you understand how much home equity you have and advise you on some of the ways you can use it.  Here are a few examples.

1. Buy a Home That Fits Your Needs

If you no longer have the space you need, it might be time to move into a larger home. Or it’s possible you have too much space and need something smaller. No matter the situation, consider using your equity to power a move into a home that fits your changing lifestyle. 

If you want to upgrade your house, you can put your equity toward a down payment on the home of your dreams. And if you’re planning to downsize, you may be surprised that your equity may cover some, if not all, of the cost of your next home. A real estate advisor can help you figure out how much equity you have and how you can use it toward the purchase of your next home.

2. Reinvest in Your Current House

According to a recent survey from Point, 39% of homeowners would invest in home improvement projects if they chose to access their equity. This is a great option if you want to change some things about your living space but you aren’t ready to make a move just yet.

Home improvement projects allow you to customize your home to suit your needs and sense of style. Just remember to think ahead with any updates you make, as some renovations add more value to your home and are more likely to appeal to future buyers than others. For example, a report from the National Association of Realtors (NAR) shows refinishing or replacing wood flooring has a high-cost recovery. Lean on a local professional for the best advice on which projects to invest in to get the greatest return on your investment when you sell.

3. Pursue Your Personal Goals

In addition to making a move or updating your house, home equity can also help you achieve the life goals you’ve dreamed of. That could mean investing in a new business venture, retiring or downsizing, or funding an education. While you shouldn’t use your equity for unnecessary spending, leveraging it to start a business or putting it toward education costs can help you achieve other lifelong goals.

Bottom Line

Your equity can be a game changer. If you’re unsure how much equity you have in your home, let’s connect so you can start planning your next move.

Nov. 29, 2022

Your House Could Be the #1 Item on a Homebuyer’s Wish List

Each year, homeowners planning to make a move are faced with a decision: sell their house during the holidays or wait. And others who have already listed their homes may think about removing their listings and waiting until the new year to go back on the market.

The truth is many buyers want to purchase a home for the holidays, and your house might be just what they’re looking for. Here are five great reasons you shouldn’t wait to sell your house.

1. While the supply of homes for sale has increased this year, there still aren’t enough homes on the market to keep up with buyer demand. As Nadia Evangelou, Senior Economist & Director of Forecasting at the National Association of Realtors (NAR), explains:

“There’s still this gap between demand and supply because we were underbuilding for many years. . . . So now we see demand is slowing, but it still outpaces supply.”

2. Serious homebuyers are out looking right now. Millennials are driving homebuying demand today, and many are eager to make a purchase. Mark Fleming, Chief Economist at First American, explains:

“While not the frenzy of 2021, the largest living generation, the Millennials, will continue to age into their prime home-buying years, creating a demographic tailwind for the housing market.”

3. The desire to own a home doesn’t stop during the holidays. In fact, homes decorated for the holidays appeal to many buyers. Plus, purchasers who look for homes during the holidays are ready to buy.

4. You can restrict the showings in your house to days and times that are most convenient for you. That can help you minimize disruptions, which is especially important this time of year.

5. Rents have skyrocketed in recent years. And, many buyers are looking to escape rising rents and avoid falling into the rental trap for another year. As an article from Zillow says:

“Over the next 12 months, rents are expected to grow more than inflation, the stock market and home values.”

Your home could be their ticket to leaving renting behind for good.

Bottom Line

There are still many reasons it makes sense to list your house during the holiday season. Let’s connect to determine if selling now is your best move.

Nov. 15, 2022

Rent vs. Buy: How to Decide What’s Best for You

Should I Rent or Buy in 2022?

 

As most of us are now aware, the market has softened. The news thrives on fear, with clickbait headlines driving traffic, so let's dive into some data that explain the real story. 

 

"Foreclosures are up 150%!" Although true, there was a moratorium on foreclosures during the pandemic, so this comparison, we believe, is skewed. Very few homes are facing foreclosure as the majority of those distressed still have equity in their property, plus there are more programs for these homeowners now to tap into to either sell or modify their existing mortgage.

 

"Mortgage rates are skyrocketing!". The 30 yr fixed mortgage rate is just over 7%, and we may even see them hit 8+% next year. Yes, they've risen sharply, and that's unsettling. Rates rise to curb inflation, but we should admit rates spoiled us at 3% or less. Many of us have had mortgages at 7% or higher without blinking an eye. Let's remind ourselves that the insanely lenient lending practices we saw in the early 2000s are not the norm today plus, importantly, there is still a housing inventory shortage. Home builders burned during the 06' housing crisis are gun-shy to leave themselves exposed in a downturn. Builders were overbuilt then but not so today. Another factor is the millennial buyers' population size, which accounts for 43% of all homebuyers, the largest of any generation! These Baby Boomer children are now in the market, and despite what the media may say, they value a home purchase.

 

In most cases, it still makes more sense to purchase than rent, and real estate is still a great investment purchase, even in a recession. A general rule of thumb for most is that if you're planning to live in or keep your property for at least two years, it's financially savvier to purchase than lease. Why lease and build equity for an investor when you can make it yourself? Now is also an excellent time for Buyers to negotiate on price &/or get Sellers to help contribute towards closing costs. Lenders also offer programs that allow Sellers to contribute toward buying down a mortgage rate for 2-3 years. A Buyer can reap the benefits of lower rates for the first few years and then refinance once rates settle down and eventually drop. Mortgage rates fell in 8 of 9 previous recessions, and home appreciation continued! 

 

Historically, high-net-worth individuals acquire their wealth, in large part, through building real estate equity. Seek a knowledgeable real estate agent who cares about your goals and the return on your investments. Homeownership wins over time!

 

Barbara Schluraff

barbara@c21ocean.com

(321) 323-1212

Broker/Owner - CENTURY 21 Ocean

 

 

 

RENT VS BUY - Calculator

 

 

 

 

 

 

 

Nov. 9, 2022

What’s Ahead for Mortgage Rates and Home Prices?

Mortgage Rates and Home Prices in 2022 and 2023

 

Now that the end of 2022 is within sight, you may be wondering what’s going to happen in the housing market next year and what that may mean if you’re thinking about buying a home. Here’s a look at the latest expert insights on both mortgage rates and home prices so you can make your best move possible.

Mortgage Rates Will Continue To Respond to Inflation

There’s no doubt mortgage rates have skyrocketed this year as the market responded to high inflation. The increases we’ve seen were fast and dramatic, and the average 30-year fixed mortgage rate even surpassed 7% at the end of last month. In fact, it’s the first time they’ve risen this high in over 20 years (see graph below):

What’s Ahead for Mortgage Rates and Home Prices? | MyKCM

In their latest quarterly report, Freddie Mac explains just how fast the climb in rates has been:

“Just one year ago, rates were under 3%. This means that while mortgage rates are not as high as they were in the 80’s, they have more than doubled in the past year. Mortgage rates have never doubled in a year before.

Because we’re in unprecedented territory, it’s hard to say with certainty where mortgage rates will go from here. Projecting the future of mortgage rates is far from an exact science, but experts do agree that, moving forward, mortgage rates will continue to respond to inflation. If inflation stays high, mortgage rates likely will too.

Home Price Changes Will Vary by Market

As buyer demand has eased this year in response to those higher mortgage rates, home prices have moderated in many markets too. In terms of the forecast for next year, expert projections are mixed. The general consensus is home price appreciation will vary by local market, with more significant changes happening in overheated areas. As Mark Fleming, Chief Economist at First American, says:

“House price appreciation has slowed in all 50 markets we track, but the deceleration is generally more dramatic in areas that experienced the strongest peak appreciation rates.

Basically, some areas may still see slight price growth while others may see slight price declines. It all depends on other factors at play in that local market, like the balance between supply and demand. This may be why experts are divided on their latest national forecasts (see graph below):

What’s Ahead for Mortgage Rates and Home Prices? | MyKCM

Bottom Line

If you want to know what’s happening with home prices or mortgage rates, let’s connect so you have the latest on what experts are saying and what that means for our area.

Oct. 24, 2022

3 Questions You May Be Asking About Selling Your House Today

Should I Sell My House In 2022 Q4?

  • If you’re planning to sell your house this year, you likely have questions about what the shift in the housing market means for your home sale.
  • You might be wondering: Should I wait to sell? Are buyers still out there? And can I afford to buy my next home?
  • Let’s connect so you can get answers to these questions and learn about the opportunities you still have in today’s housing market.

Oct. 24, 2022

Pre-Approval Is a Critical First Step on Your Homebuying Journey

The Pre-Approval Home Mortgage Process

If you’re planning to buy a home this year, one of the first steps on your journey is getting pre-approved. Especially in today’s market when mortgage rates are higher than they were just a few months ago, getting a mortgage pre-approval can be a game changer. Here’s why.

What Is Pre-Approval?

To better understand why pre-approval is vital, it’s essential to know what pre-approval is. The Mortgage Reports explains it like this:

“When you’re ready to take the leap into homeownership, your first step is mortgage preapproval. . . . A mortgage preapproval is when a lender determines you’re qualified for a home loan. Your preapproval letter shows the maximum loan amount you’re approved for (your home buying budget), as well as the specific interest rate and loan term you can expect.

As part of the pre-approval process, a lender will look at your finances to determine what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you understand your actual price range and how much money you can borrow. That can make searching for homes easier because you’ll know your overall numbers. And with mortgage rates rising and impacting affordability, a solid understanding of your numbers is even more critical.

Pre-Approval Can Signal You’re a Serious Buyer

Another added benefit is that pre-approval lets the seller know you’re qualified to buy their house. A recent article from realtor.com notes:

“. . . getting pre-approved can actually improve your chances of falling into the sellers’ good graces, and you’ll want to get it done as early as you possibly can in the home-buying process.”

Even though bidding wars are easing this year as the market shifts, preapproval is still essential to making a strong offer. It can help a seller feel more confident because it shows you’re serious about their home and that you’re a qualified buyer.

Bottom Line

Getting pre-approved for a mortgage is critical. It helps you better understand what you can borrow and shows sellers you’re serious about purchasing their home. Connect with a local real estate professional and a trusted lender so you have the tools you need to succeed as a homebuyer in today’s market.

 

A Few Of CENTURY 21 Ocean's Preferred Lenders ~ Find Here!

 

 

Oct. 24, 2022

If you’re taking the time to recycle at home, are you sure that you’re doing it right?

Are You Recycling Correctly At Home?

 

Many consumers today are not carefully considering which waste products they are sending off for recycling, causing problems and increased costs for these programs. Here are a few quick reminders on how to make sure you’re doing your part:

  • Do not send items contaminated with food waste. Food waste, particularly grease and other fats, can make paper recyclables unusable as a recycled material. And if you’re using a single-stream recycling program, ensuring there is no food waste on your plastics or glass will help insure that paper is not contaminated as these items are all mixed.
  • Know your plastics. Recycling programs that accept plastic items don’t typically accept all plastic types. You’ll find the number 1-7 inside the recycling symbol on plastic items. Check with your recycling program to understand which plastic types they can accept and process, and be sure to omit any plastic types they’re not set up to handle.
  • Don’t dump electronics! Electronic equipment must be broken down into parts and recycled or disposed of properly. Do not put these items in your recycling or in your trash! Many of these items contain hazardous materials and will contaminate water or soil if they are simply dumped into a landfill. Instead, take your unwanted electronics to a drop-off site in your community where they can be processed appropriately.

 

Posted in Going Green
Oct. 19, 2022

Should You Still Buy a Home with the Latest News About Inflation?

Should I Buy A Home While Inflation Is High?

While the Federal Reserve is working hard to bring down inflation, the latest data shows the inflation rate is still high, remaining around 8%. This news impacted the stock market and fueled the fire for conversations about a recession.

You’re likely feeling the impact in your day-to-day life as you watch the cost of goods and services climb. The pinch it’s creating on your wallet, and the looming economic uncertainty may leave you wondering: “should I still buy a home right now?” If that question is top of mind for you, here’s what you need to know.

Homeownership Is Historically a Great Hedge Against Inflation

In an inflationary economy, prices rise across the board. Historically, homeownership is an excellent hedge against those rising costs because you can lock in what’s likely your most significant monthly payment (your mortgage) for the duration of your loan. That helps stabilize some of your monthly expenses. James Royal, Senior Wealth Management Reporter at Bankrate, explains:

A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same.”

And with rents being as high as they are, the ability to stabilize your monthly payments and protect yourself from future rent hikes may be even more critical. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains what happened to rents in the latest inflation report:

“Inflation refuses to budge. In September, consumer prices rose by 8.2%. Rents rose by 7.2%, the highest pace in 40 years.”

When you rent, your monthly payment is determined by your lease, which typically renews annually. With inflation high, your landlord may be more likely to increase your payments to offset the impact of inflation. That may be part of why a survey from realtor.com shows 72% of landlords said they plan to raise the rent on one or more of their properties in the next year.

If you’re ready and able to do so, becoming a homeowner can provide lasting stability and a reliable shelter in times of economic uncertainty.

Bottom Line

The best hedge against inflation is a fixed housing cost. Let's connect if you’re ready to learn more and start your journey to homeownership.

Oct. 17, 2022

The Emotional and Non-financial Benefits of Homeownership

The Non-financial Benefits of Homeownership

 

With higher mortgage rates, you might be wondering if now’s the best time to buy a home. While the financial aspects are important to consider, there are also powerful non-financial reasons it may make sense to make a move. Here are just a few of the benefits that come with homeownership.

Homeowners Can Make Their Home Truly Their Own

Owning your home gives you a significant sense of accomplishment because it’s a space you can customize to your heart’s desire. That can bring you added happiness.

In fact, a report from the National Association of Realtors (NAR) shows making updates or remodeling your home can help you feel more at ease and comfortable in your living space. NAR measures this with a Joy Score that indicates how much happiness specific home upgrades bring. According to NAR:

There were numerous interior projects that received a perfect Joy Score of 10: paint entire interior of home, paint one room of home, add a new home office, hardwood flooring refinish, new wood flooring, closet renovation, insulation upgrade, and attic conversion to living area.”

And as a homeowner, unless there are specific homeowner’s association requirements, you typically won’t have to worry about the changes you can and can’t make.

If you rent, you may not have the same freedom. And if you do make changes as a renter, there’s a good chance you’ll need to revert them back at the end of your lease based on your rental agreement. That can add additional costs when you move out.

The Responsibilities of Homeownership Give You a Greater Sense of Achievement

There’s no denying taking care of your home is a large responsibility, but it’s one you’ll take pride in as a homeowner. Freddie Mac explains:

“As the homeowner, you have the freedom to adopt a pet, paint the walls any color you choose, renovate your kitchen, and more. . . . Of course, along with the freedoms of homeownership come responsibilities, such as making your monthly mortgage payments on time and maintaining your home. But as the property owner, you’ll be caring for your own investment.

You’re not taking care of a living space that belongs to someone else. The space is yours. As an added benefit, you may get a return on investment for any upgrades or repairs you make.

Homeownership Can Lead to Greater Community Engagement

That sense of ownership and your feelings of responsibility can even extend beyond the walls of your home. Your home also gives you a stake in your community. Because the average homeowner stays in their home for longer than just a few years, that can lead to having a stronger connection to your local area. NAR notes how that can benefit you:

“Living in one place for a longer amount of time creates an obvious sense of community pride, which may lead to more investment in said community.”

If you’re looking to put down roots, homeownership can help fuel a sense of connection to the area and those around you.

Bottom Line

If you’re planning to buy a home this year, there are incredible benefits waiting for you at the end of your journey, including the ability to customize your home, the sense of achievement homeownership brings, and a greater connection to your community. Let’s connect to discuss everything homeownership has to offer.