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Hughes
Where are Mortgage Rates Headed?
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )

Where Are Mortgage Rates Headed?

Where Are Mortgage Rates Headed? | Simplifying The Market

The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be. That is why it is important to look at where rates are headed when deciding to buy now or wait until next year.

Below is a chart created using Freddie Mac’s February 2015 U.S. Economic & Housing Marketing Outlook. As you can see interest rates are projected to increase steadily over the course of 2015.

30-Year Fixed Rate Mortgage Projections | Simplifying The Market

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

Research released by Zillow touched on this point:

“As rates rise, new home buyers will confront higher financing costs and monthly mortgage payments. For many, this will mean tightening their budgets and sacrificing some luxuries they may take for granted today.”

The experts predict that home prices will appreciate by 4.4% over the course of 2015. If both predictions become reality, families would wind up paying considerably more for their home.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth. Meet with a local real estate professional to evaluate your ability to purchase your dream home.

That old saying "that is the $64,000question"  but they are going up. It is still a far cry from what many of us were used to in the old days 6,7,8,9,10,and up to 18.50% in the 1980's. 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
Are Prices Beginning to Accelerate Again?
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )

Are House Prices Beginning to Accelerate Again?

 

In a recent post, we explained that the supply of homes for sale in December was at its lowest level in over a year. The January National Housing Trend Report from realtor.com now reveals that inventory in January has decreased another 6.7% month over month and 8.7% year over year. This is occurring at the same time that buyer activity (demand) remains strong.

This prompted realtor.com’s Chief Economist Jonathan Smoke to report:

“January’s inventory data suggest a continuation of the tightening trend we identified last month in the December data, and with a shortage of inventory typically comes increased home prices. Half of the 200 markets realtor.com tracks experienced year-over-year price increases of at least 6% in January.”

This after the National Association of Realtors (NAR) had already reported in their latest quarterly report:

“The majority of metropolitan areas experienced steady but slightly stronger price growth in the fourth quarter of 2014, behind a decline in housing supply and an uptick in demand fueled by lower interest rates and a stronger job market.” 

Bottom Line

Whether you are a first time buyer or a move-up buyer, now may be time to purchase a home – before prices increase any further.  Prices are trending higher for sure. 

 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
Thinking of Buying? What are you waiting for?
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )

 

 

Thinking of Buying? What are you waiting for?

Thinking of Buying? What Are You Waiting For? | Simplifying The Market

If you are planning on becoming a homeowner, or moving up to the home of your dreams in 2015, here are four great reasons to consider buying a home now, instead of waiting until spring.

1. Prices Will Continue to Rise

The Home Price Expectation Survey polls a distinguished panel of over 100 economists, investment strategists, and housing market analysts. Their most recent report projects appreciation in home values over the next five years to be between 11.7% (most pessimistic) and 27.5% (most optimistic).

The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.

2. Mortgage Interest Rates Are Projected to Increase

Although Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have softened recently, most experts predict that they will begin to rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac & the National Association of Realtors are in unison projecting that rates will be up almost a full percentage point by the end of 2015.

An increase in rates will impact YOUR monthly mortgage payment. Your housing expense will be more a year from now if a mortgage is necessary to purchase your next home.

3. Either Way You are Paying a Mortgage

As a paper from the Joint Center for Housing Studies at Harvard University explains:

“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return. That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”

4. It’s Time to Move On with Your Life

The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise.

But, what if they weren’t? Would you wait?

Look at the actual reason you are buying and decide whether it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer or you just want to have control over renovations, maybe it is time to buy.

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.

Prices will rise no doubt it and so why Wait?

 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
Consumer Confidence at Highest Level ...
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )

Consumer Confidence at Highest Level in Over a Decade

Consumer Confidence at Highest Level in Over a Decade | Simplifying The Market

Two recently released reports reveal that the American public is starting to feel much better about the U.S. economy. The University of Michigan’s Surveys of Consumers showed that:

“Consumer optimism reached the highest level in the past decade in the January 2015 survey…Consumers judged prospects for the national economy as the best in a decade, with half of all consumers expecting the economic expansion will continue for another five years. The anticipated strength in the overall economy has been accompanied by more favorable income and employment expectations.”

Here is a chart showing results over the last decade:

Consumer Optimism | Simplifying The Market

As all consumers are feeling more optimistic, more young adults are moving out of their parents’ basements and into a residence of their own. The recent Census report shows that new household formations skyrocketed in 2014. Below is a chart showing the historical significance of the numbers:

Household Formations | Simplifying The Market

Bottom Line

The economy is definitely improving and, more importantly, the American consumer is beginning to feel much more confident. This should lead to a very robust real estate market in 2015.

Fabulous outlook for this year 2015.  Very exciting anticipated!

 

 Send me an Email
 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
Moving Across America
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )
 
 

Moving Across America [INFOGRAPHIC]

Moving Across America [INFOGRAPHIC] | Simplifying The Market

It is really something to see where the Americans are moving to and from.  Leaving New York, my opnion TAXES. Illinois could be crime perhaps. Connecticut TAXES. Just opinions.  Washington DC low unemployment and so many government workers.  Florida & Texas better cost of Living.  Idaho and Oklahoma are beautiful. 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
The Difference Between A Home's Cost vs. Price
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )
 
 

The Difference Between A Home’s Cost vs. Price

The Difference Between A Home’s Cost vs. Price | Simplifying The Market

As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As either a first time or repeat buyer, you must not be concerned only about price but also about the ‘long term cost’ of the home.

Let us explain.

There are many factors that influence the ‘cost’ of a home. Two of the major ones are the home’s appreciation over time, and the interest rate at which a buyer can borrow the funds necessary to purchase their home. The rate at which these two factors can change is often referred to as “The Cost of Waiting”.

What will happen in 2015?

A nationwide panel of over one hundred economists, real estate experts and investment & market strategists project that home values will appreciate by almost 4% by the end of 2015.

Additionally, Freddie Mac’s most recent Economic Commentary & Projections Table predicts that the 30-year fixed mortgage rate will appreciate to 4.5% by the end of 2015.

What Does This Mean to a Buyer?

Here is a simple demonstration of what impact these projected changes would have on the mortgage payment of a home selling for approximately $250,000 today:

Cost of Waiting | Simplifying The Market

It will be interesting to see what this year holds for buyers and the prices plus interest rates.  You never know until you look back.

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

Hughes
5 Reasons You Shouldn't For Sale By Owner
Pat Laracy Baker, Realtor, Green, ABR, Needham, Massachusetts (Key Advantage Realty )

5 Reasons You Shouldn’t For Sale By Owner

5 Reasons You Shouldn't For Sale By Owner | Simplifying The Market

Some homeowners consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). There are several reasons this might not be a good idea for the vast majority of sellers.

Here are five reasons:

1. There Are Too Many People to Negotiate With

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:

  • The buyer who wants the best deal possible
  • The buyer’s agent who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies which work for the buyer and will almost always find some problems with the house.
  • The appraiser if there is a question of value
  • keeping the sale in tact for the time between the accepted of and managing the phone calls to all parties is consuming 

2. Exposure to Prospective Purchasers

Recent studies have shown that 88% of buyers search online for a home. That is in comparison to only 21% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

3. Results Come from the Internet

Where do buyers find the home they actually purchased?

  • 43% on the internet
  • 9% from a yard sign
  • 1% from newspaper

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

4. FSBOing has Become More and More Difficult

The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 9% over the last 20+ years.

5. You Net More Money when Using an Agent

Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.

Studies have shown that the typical house sold by the homeowner sells for $208,000 while the typical house sold by an agent sells for $235,000. This doesn’t mean that an agent can get $27,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

Bottom Line

Before you decide to take on the challenges of selling your house on your own, sit with a real estate professional in your marketplace and see what they have to offer.

 

Pat Baker, Realtor, ABR

Key Advantage Realty

150 West St.

Needham, MA 02494

617-435-3471

pbaker@keyadvantagerealty.com 

https://www.linkedin.com/in/patbaker

 

 

 

 

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