Nooshi Naderi | Blog
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A Housing Bubble? Industry Experts Say NO!

20 Nov 2017 Posted by NooshiAdmin in Blog

With residential home prices continuing to appreciate at levels above historic norms, some are questioning if we are heading toward another housing bubble (and subsequent burst) like the one we experienced in 2006-2008.

Recently, five housing experts weighed in on the question.

Rick Sharga, Executive VP at Ten-X:

“We’re definitely not in a bubble.”

“We have a handful of markets that are frothy and probably have hit an affordability wall of sorts but…while prices nominally have surpassed the 2006 peak, we’re not talking about 2006 dollars.”

Christopher Thornberg, Partner at Beacon Economics:

“There is no direct or indirect sign of any kind of bubble.”

“Steady as she goes. Prices continue to rise. Sales roughly flat.…Overall this market is in an almost boring place.”

Bill McBride, Calculated Risk:

“I wouldn’t call house prices a bubble.”

“So prices may be a little overvalued, but there is little speculation and I don’t expect house prices to decline nationally like during the bust.”

David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices:

“Housing is not repeating the bubble period of 2000-2006.”

“…price increases vary unlike the earlier period when rising prices were almost universal; the number of homes sold annually is 20% less today than in the earlier period and the months’ supply is declining, not surging.”

Bing Bai & Edward Golding, Urban Institute:

“We are not in a bubble and nowhere near the situation preceding the 2008 housing crisis.”

“Despite recent increases, house prices remain affordable by historical standards, suggesting that home prices are tracking a broader economic expansion.”

Source: KCM.com

Renting or Buying…Either Way, You’re Paying Someone’s Mortgage

08 Nov 2017 Posted by NooshiAdmin in Blog

There are some people who have not purchased homes yet because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich,”

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Managementorganization at Freddie Mac, explains another benefit of securing a mortgage vs. paying rent:

“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.”

As an owner, your mortgage payment is a form of ‘forced savings’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person with that equity.

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 3.94% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

Source: KCM.com

How about a black kitchen???

06 Nov 2017 Posted by NooshiAdmin in Blog

Respect for Architecture and Attention to Detail Revive an English Tudor Kitchen

“Can you do a black kitchen?” Mario J. Mulea laughs as he recalls the first words the homeowner spoke to him. The homeowner had just stepped into the showroom for Kitchen Designs by Ken Kelly (kitchendesigns.com), a firm serving the Long Island area of New York where Mulea works as a kitchen designer. As an experienced interior designer herself, the homeowner had a clear vision of what she wanted to accomplish. That she sought Mulea’s help offers a clue into how specialized and complicated kitchen design can be.

The kitchen in the homeowner’s nearly-century-old Tudor was the final update that needed to be made to return the home to its former glory. In Mulea, she found a kindred spirit who appreciated the history of her home and believed it should inform and inspire the design. “I always talk about the house first,” he says, describing his design process. “What’s the style of the house? What neighborhood is it in? Do the interiors match the architecture? If you have a center-hall colonial and you ask for cobalt-blue, high-gloss cabinets, I’ll tell you that you’ve picked the wrong designer. I’m not going to do that.”

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With pickled maple cabinets, green Formica countertops, and vinyl flooring, nothing about the kitchen matched the home’s Tudor style. Respecting that architecture necessarily constrained the design. Windows, doors, and a radiator could not be moved. Another design constraint, which would ultimately become the room’s centerpiece, was a wish-list purchase by the homeowner. “She absolutely had to have the La Cornue CornuFé range,” Mulea recalls.

After the must-go, must-stay, and must-add items were defined, Mulea’s next questions revolved around how the room would be used. “I talk with clients about how their family uses the kitchen and how they use it when they have visitors,” he says. “We discuss zones and how kitchens work.” He notes that the “work triangle” notion is now outdated for most modern homes. It’s more helpful to know how homeowners actually use the space and what traffic flows in and out of the room.

Once all the information is gathered, Mulea starts sketching possible ideas. That’s the creative side of the process, but it’s paired with more analytical considerations. “A kitchen is both a giant jigsaw puzzle and a math problem,” he explains. Once you know window and door positions and appliance sizes, you then have to figure out the best way for cabinets, islands, and countertops to fill the room’s envelope. Every available inch of space in this kitchen is put to use.

Respecting the home’s history meant choosing materials that seemed contemporaneous. “The materials you use don’t have to be historic, as if they’ve been there for one hundred years. The critical thing that makes a kitchen timeless is integrating it into the fabric of the rest of the house,” says Mulea. The distressed finish of the black cabinets is one such example. Handscraped hickory floors with black distressing also add a patina of history to the room.

Timeless Tudor

The homeowner, a designer herself, worked closely with the kitchen designer, Mulea. The layout, architectural details, and finishes were his purview, while she focused on accessories, fixtures, and fabrics.

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The black La Cornue range with brass trim serves as a centerpiece. Other appliances were clad in cabinet panels so they would not distract from the showpiece. The mantel hood arches over the range and an English foxhunt print rests on its ledge.

No detail was overlooked during the remodel. The diamond angles of the white-tile backsplash match the angles in the room’s windows and leaded-glass cabinet fronts. A fireplace back hangs behind the range and looks like a reproduction from the Victorian era. In a corner of the room, a new door with a ring pull was added to the home’s original milk delivery box. A copper sink serves the wet bar off to the side of the room. The same wet bar camouflages the room’s radiator, which sits behind a lattice door and vented toe kicks that allow air circulation. Practical quartz counters top the perimeter cabinets, while walnut slabs cover the wet bar and island.

The homeowner added her own special design touches throughout the space, too. She discovered the vintage chandelier, which now hangs over the island, in an antique store and had it rewired. The wallpaper was her request, and the plaid-covered stools with brass nailheads were one of her finds. On a trip to England, she gathered many of the teapots, crystal, and curios on display behind the glass-fronted cabinets.

The surfaces in the kitchen exude Old-World charm, but beneath them lies functionality. A tug on custom brass hardware reveals deep pot drawers, appliance garages, an ice dispenser, and a trash bin.

The end result is a kitchen that looks like it could have been there from the home’s beginning, but incorporates all the modern needs for today’s family. “If you look at my portfolio, you’ll see I do not have a signature design,” says Mulea. “To me, my signature is that the design must fit the house and the people who live there above everything else.”

Millennials Flock Towards Low Down Payment Programs

06 Nov 2017 Posted by NooshiAdmin in Blog

report released by Down Payment Resource shows that 61% of first-time homebuyers purchased their homes with a down payment of 6% or less.

The trend continued among all buyers with a mortgage, as 73% made a down payment of less than 20%.

An article by Chase points to a new wave of millennial homebuyers:

“We teamed up with Google to help us better understand what customers are searching for and how the home buying landscape is evolving. We found that millennials and first-time homebuyers are making a big splash in the market, and affordability remains top of mind.”

Among millennials who purchased homes, David Norris, Loan Depot’s Head of Retail Lending, said:

“It’s clear from the survey results that Millennials have a lot of anxiety built up about the home buying process.

There is good news, however, as there’s more flexibility than most Millennials think regarding how to qualify for a loan and what’s needed for a down payment.”

Bottom Line

If you are one of the many millennials who is debating a home purchase this year, contact a local professional who can help you understand your options and set you on the path to preapproval.

Source: KCM.com

Hiring An Agent To Sell Your House May Cost You NOTHING!

01 Nov 2017 Posted by NooshiAdmin in Blog

There is no doubt that it is easier to sell your house when using the services of a local real estate professional. The agent will provide:

  • Greater exposure to more buyers
  • The skills of a professional negotiator
  • A layer of protection from possible legal liabilities
  • Professional guidance in navigating any pitfalls that may arise
  • A level of safety while showing the home

There is no doubt that these services are valuable to any family that decides to sell. The only question is – how valuable? One of the main reasons For Sale By Owners (FSBOs) don’t use a real estate agent is because they believe these services are not worth the fee an agent charges. But, what if those services didn’t cost the seller a penny?

study by Collateral Analytics, however, reveals that FSBOs don’t actually save anything and, in some cases, may be costing themselves more by not listing with an agent.

In the study, they analyzed home sales in a variety of markets in 2016 and the first half of 2017. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many casesbelow the average differential represented by the prevailing commission rate.” (emphasis added)

Why would FSBOs net less money on their own than if they used an agent?

The study makes several suggestions:

  • “There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids on with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.
  • “Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.
  • “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Three conclusions from the study:

  1. FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
  2. The differential in selling prices for FSBOs when compared to MLS sales of similar properties is about 5.5%.
  3. The sales in 2017 suggest the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

If you are thinking of selling, FSBOing may end up costing you money instead of saving you money.

Source: KCM.com

Net Worth Of Homeowners 44X Greater Than Renters

27 Oct 2017 Posted by NooshiAdmin in Blog

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 data, covering 2013-2016 was released two weeks ago.

The study revealed that the 2016 median net worth of homeowners was $231,400 – a 15% increase since 2013. At the same time, the median net worth of renters decreased by 5% ($5,200 today compared to $5,500 in 2013).

These numbers reveal that the net worth of a homeowner is over 44 times greater than that of a renter.

Owning a home is a great way to build family wealth

As 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 by increasing the equity in your home.

That is why, for the fourth year in a row, Gallup reported that Americans picked real estate as the best long-term investment. This year’s results showed that 34% of Americans chose real estate, followed by stocks at 26% and then gold, savings accounts/CDs, or bonds.

Greater equity in your home gives you options

If you want to find out how you can use the increased equity in your home to move to a home that better fits your current lifestyle, meet with a real estate professional in your area who can guide you through the process.

Source: KCM.com

Which Homes Have Increased In Value The Most?

23 Oct 2017 Posted by NooshiAdmin in Blog

Home values have risen dramatically over the last twelve months. The latest Existing Home Sales Reportfrom the National Association of Realtors puts the annual increase in the median existing-home price at 5.6%. CoreLogic, in their most recent Home Price Index Report, revealed that national home prices have increased by 6.7% year-over-year.

CoreLogic broke appreciation down ever further into four price ranges which gives a more detailed view than simply looking at the year-over-year increases of the national median home price.

The chart below shows the four tiers and each one’s growth from July 2016 to July 2017 (the latest data available).

It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor in determining how much it has appreciated over the course of the last year. Lower priced homes have appreciated at greater rates than homes at the upper ends of the spectrum, due to demand from first-time home buyers and baby boomers looking to downsize.

Bottom Line

If you are planning on listing your home for sale in today’s market, find a local agent who can explain exactly what’s going on in your area and your price range.

Source: KCM.com

Thinking Of Selling Your Home? Competition Is Coming

20 Oct 2017 Posted by NooshiAdmin in Blog

The number of building permits issued for single-family homes is the best indicator of how many newly built homes will rise over the next few months. According to the latest U.S. Census Bureau and U.S. Department of Housing & Urban Development Residential Sales Report, the number of these permits were up 7.7% over last year.

How will this impact buyers?

More inventory means more options. Danielle Hale, Realtor.com’s Chief Economistexplained this is good news for the housing market – especially for those looking to buy:

“It’s not spectacular construction growth, but it’s slow and steady in the right direction. Eventually, the pickup in single-family home construction will mean [buyers] will have more options. Especially with the limited number of sales right now, more options are really needed.”

How will this impact sellers?

More inventory means more competition. Today, because of the tremendous lack of inventory, a seller can expect:

  1. A great price on their home as buyers outbid each other for it
  2. A quick sale as buyers have so little to choose from
  3. Fewer hassles as buyers don’t want to “rock the boat” on the deal

With an increase in competition, the seller may not enjoy these same benefits. As Hale said:

“As new construction continues to increase, home shoppers will eventually have more [choices] and a bit more time to make purchase decisions compared to today’s quick-moving housing market.”

Bottom Line

If you are considering the sale of your home, it might make sense to beat this new construction competition to the market.

Source: KCM.com