Rent or Buy: Either Way You’re Paying A Mortgage

Rent or Buy: Either Way You’re Paying A Mortgage | Simplifying The Market

There are some renters that have not yet purchased a home 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 your mortgage or your landlord’s.

As 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.”

Christina Boyle, a Senior Vice President, He...

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3 Charts That Scream ‘List Your Home Today’

3 Charts That Scream ‘List Your Home Today’ | Simplifying The Market

In school we all learned the Theory of Supply and Demand. When the demand for an item is greater than the supply of that item, the price will surely rise.

SUPPLY

The National Association of Realtors (NAR) recently reported that the inventory of homes for sale stands at a 4.4-month supply. This is considerably lower than the 6-month inventory necessary for a normal market.

3 Charts That Scream ‘List Your Home Today’ | Simplifying The Market

DEMAND

Every month NAR reports on the amount of buyers that are actually out in the market looking for homes, or foot traffic. As seen in the graph below, buyer demand in February significantly outpaced the last six months.

3 Charts That Scream ‘List Your Home Today’ | Simplifying The Market

Many buyers are being confronted with a very competitive market in which they must compete with other buyers for their dream home (if they even are able to find a home they wish to purchase).

Listi...

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Further Proof This Isn’t a Housing Bubble

Further Proof This Isn’t a Housing Bubble | Simplifying The Market

Two weeks ago, we posted a blog which explained that current increases in home prices were the result of the well-known concept of supply & demand and should not lead to conversations of a new housing bubble. Today, we want to look at home prices as compared to current incomes.

Here is a graph showing the monthly mortgage payment on a median priced home in the U.S. over the last 25 years:

Further Proof This Isn’t a Housing Bubble | Simplifying The Market

Mortgage payments are currently well below the historic average over that time period. Purchasers are not overextending themselves to buy a home like they did on the run-up to the housing crash.

Lawrence Yun, the Chief Economist at the National Association of Realtors, recently explained in a Forbes article:

“Even though home prices are climbing far above people’s income, exceptionally low mortgage rate...

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The Top 5 Reasons You Should Not For Sale By Owner

The Top 5 Reasons You Should Not For Sale By Owner | Simplifying The Market

In today’s market, with homes selling quickly and prices rising, some homeowners might 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 of those 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...

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Past, Present & Future Home Values

Past, Present & Future Home Values | Simplifying The Market

In CoreLogic’s latest Home Price Index, they revealed home appreciation in three categories: percentage appreciation over the last year, over the last month, and projected appreciation over the next twelve months.

Here are state maps for each category:

The Past – home appreciation over the last 12 months

Past, Present & Future Home Values | Simplifying The Market

The Present – home appreciation over the last month

Past, Present & Future Home Values | Simplifying The Market

The Future – home appreciation projected over the next 12 months

Past, Present & Future Home Values | Simplifying The Market

Bottom Line

Homes across the country are appreciating at different rates. As we have mentioned before, the rate of home price appreciation across the country is due to a strong housing market reacting to supply and demand, and not a new housing bubble.

If you plan on relocating to another state, and are waiting for your home to appreciate more, you need t...

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Don’t Be Fooled… Home Ownership Is A Great Investment! [INFOGRAPHIC]

Don't Be Fooled... Homeownership Is A Great Investment! [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • Harvard University’s Joint Center of Housing Studies recently released the top financial & emotional reasons to own a home.
  • Owning is a good way to build up wealth that can be passed along to your family as it is usually a form of “forced savings.”
  • Whether you rent or own, you are paying a mortgage. Yours when you own, your landlord’s when you rent.

Source: KCM

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Yes, Home Prices Are Rising. No, a New Housing Bubble is NOT Forming

Yes, Home Prices Are Rising. No, a New Housing Bubble is NOT Forming | Simplifying The Market

We recently reported that home prices are continuing to rise across most of the nation. This has created concern in some pundits that a housing bubble, like we saw ten years ago, is forming again. We want to explain why these concerns are unfounded.

The current increase in home values can be easily explained by the theory of supply and demand. Right now, the number of families looking to purchase a home is greater than the supply of homes on the market.

Here is a chart that explains how the months’ supply of housing inventory impacts home values:

Yes, Home Prices Are Rising. No, a New Housing Bubble is NOT Forming | Simplifying The Market

According to the latest Existing Home Sales Report from the National Association of Realtors, there is currently a four-month supply of inventory. That puts us in the blue section of the above graphic. Home prices should be appreciating.

The ...

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What If I Wait Until Next Year To Buy A Home?

What If I Wait Until Next Year To Buy A Home? | 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 over the next 12 months?

According to CoreLogic’s latest Home Price Index, prices are expected to rise by 5.5% by this time next year.

Additionally, Freddie Mac’s most recent Econ...

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Use a Philadelphia Real Estate Agent when Selling Your Philly House

The Main Reason to Use a Real Estate Professional when Selling your House | Simplifying The Market

Every homeowner hopes to accomplish five goals when selling their home:

  1. Sell it for the best price
  2. Sell it within a predetermined time
  3. Sell it with the least amount of hassles
  4. Close on the sale the same day they move into their new home

The fifth reason is the most obvious and the most important:

  1. They want to make sure it sells.

In order to dramatically increase the chances that the house sells, a homeowner should list with a real estate professional in their market. Why? Because agents have access to the vast majority of the available buyers!!

According to the National Association of Realtors(NAR) recently released 2016 Home Buyer and Seller Generational Trends Report, 87% of all buyers purchased their home through a real estate agent or broker...

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The Mortgage Process: What You Need To Know [INFOGRAPHIC]

The Mortgage Process: What You Need To Know [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • Many buyers are purchasing a home with a down payment as little as 3%.
  • You may already qualify for a loan, even if you don’t have perfect credit.
  • Take advantage of the knowledge of your local professionals who are there to help you determine how much you can afford.

Source: KCM

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