Today I interviewed Rashel Yadegari, Prosperity Home Mortgage as we discuss the common lending myths in the home buying process. If you have any questions with the lending process, please don’t hesitate to contact me or Rashel. Hope you enjoy my interview, as it is meant to be a open conversation and an ongoing discussion; I believe it’s best be informed so you can make smarter decisions.
Rashel Yadegari, Prosperity Home Morgage, Mortgage Consultant
NMLSR ID: 1246397
Lynne Watanabe MacFarlane, MCDM, SRES | Realtor
PFAC Silicon Valley affiliate
Intero | A Berkshire Hathaway Affiliate
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Thanks for your interest!
Outside of a strong economy, low unemployment, and higher wages, there are three more great reasons why you may want to consider buying your dream home this year instead of waiting.
1. Buying a Home is a Great Investment
Several reports indicate that real estate is a good investment, topping other options such as gold, stocks, bonds, and savings. Why? Real estate helps build equity, a form of investing for you and your family. According to CoreLogic’s Equity Report,
“U.S. homeowners with mortgages (roughly 64% of all properties) have seen their equity increase by a total of nearly $457 billion since the third quarter 2018, an increase of 5.1%, year over year.”
This means the average homeowner gained approximately $5,300 in equity over the past year. If you want to start building your equity, put your housing costs to work for you through homeownership this year.
2. Mortgage Interest Rates Are Low
The Primary Mortgage Market Survey from Freddie Mac indicates that interest rates for a 30-year mortgage have fallen since November 2018 when they hit 4.94%. In their latest forecast, Freddie Mac expects rates to remain low, leveling out to a yearly average of 3.8% in 2020.
When you purchase a home at a low mortgage rate, it will impact your monthly mortgage payment, giving you the opportunity to buy more house for your money.
3. Investing in Your Family is a Win
There are some renters who haven’t purchased a home yet because they’re uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you’re living rent-free with your parents, you’re paying a mortgage – either yours or that of your landlord.
Today, rental prices continue to increase, and when you’re paying your landlord’s mortgage instead of your own, you’re not the one earning the equity. As an owner, your mortgage payment is a form of ‘forced savings’ you can use later in life to reinvest in your family. You can use it for a variety of opportunities, such as saving for your children’s education, moving up to a bigger home, or starting your own business. As a renter, it can be more challenging to achieve those types of dreams without home equity working for you.
Buying a home sooner rather than later could lead to substantial savings and long-term financial growth for you and your family. Let’s get together to determine if homeownership is the right choice for you this year.
Lynne MacFarlane, MCDM, Realtor
Welcome to Spring 2019 and if you were out shopping for your dream home but failed to win in a multiple offer situation now’s the time to reconsider coming back and shopping again!
From the California Association of Realtors.
Here in California we are experiencing the weakest growth of home prices in 7 years. Take advantage of this if you’re a buyer. And if this is the opportunity you’ve been waiting for, be prepared! Yes, even with all the talk of the market softening, SF Bay Area counties (Silicon Valley/ Santa Cruz County) are still in a strong Seller’s Market, so talk to your lender, and if you don’t have one I can recommend a couple, so you know how much house you can afford prior to your search. When you have a “pre-qual.” letter from a lender it demonstrates to the seller that you are serious about their home and ready to move forward with an offer.
If you would like to discuss your real estate goals (first time buyer/ investment property), text or email me today!
Condos and townhomes are great for all buyers but especially for first time buyers, it can be a starting point for new home ownership. After 5-7 years usually one of two things occur: 1) buyers out grow the condos and move-up to a larger condo or single family home 2) buyers keep the condo and rent it out; good for passive income. Buyers can buy another home in a different city or a completely different state yet still have that revenue generating from their original condo purchase.
Condos and townhomes usually do have a lower price point in communities making it more attractive for new buyers or investors. An additional advantage of a condo is that they are often easier to maintain for the individual because Home Owner’s Association (HOA) often take care of the shared community & external sites of the properties. As a buyer it’s important to make note of the HOA dues , what the association costs cover, and consider the expense to the entire cost the property. (There are more pros and cons to condo vs. single family home which I’ll save for another post.)
Great news for home buyers! Home prices are softening – a good time for buyers to come back from years past, even comparatively so from last year, and we’re seeing offers now with contingencies and increased property inventory. We are still seeing multiple offers at our brokerage (Intero) but those that are good properties that are well-priced at the start of listing.
We are seeing cooling from a super hot market in Santa Clara County at (-10.6%) which does not reflect a crash but just a readjustment. Sonoma County has decline at (-7.5%) sadly due to the 2017 fires.
Call/Text for a free market report of Santa Clara county condos / townhouses / single family homes today!
Interesting to note that the Central Valley is still growing in places such as Kern (7.5%), Merced (6.8%), Fresno (5.7%), San Benito (4%), Stanislaus (3.9%) and Glenn (2.2%).
Many buyers are wisely looking inland to Kern, Merced and Fresno counties to find affordable homes.
Call me if you need assistance and information in any of these counties!
Places such as Santa Barbara (-20%) and Monterey county(-7%) is cooling off, but local communities in Santa Cruz county (up a modest .9%) and San Luis Obispo (3.2%) are being ‘discovered’ by Silicon Valley remote workers & retirees wanting to keep the casual and coastal lifestyle. In other words, we are seeing money shift from over heated markets to secondary markets. Google, Facebook, LinkedIn and other tech companies are now using buses to shuttle their employees from their headquarters to farther communities such as Los Gatos, Scotts Valley, and Santa Cruz.
On a more personal note, my husband and I enjoy living in Capitola for the community, the outdoor lifestyle and relative proximity to work in Santa Clara county. I expect to see these homes by the sea to appreciate as they are great investments and good frequently bought as homes for retirement or weekend vacation properties.
Text me if you’d like a list of single family homes or condos in the
Santa Cruz County today!
. We are seeing more supply than a year ago which gives greater options for buyers.
This is an interesting slide demonstrating the discrepancy between the seller’s listing price and the sales.
. Notice the difference between March 2018 & March 2019.
We are seeing more active listings compared to last year, meaning there’s more selection for buyers.
Rates are still historically low and compared to foreign countries, those buyers feel we are extremely fortunate. It isn’t necessary to put 20% downpayment and there are many loans to consider that might suit your requirements.
No other economy is as diverse and dynamic as California. California is the 5th largest economy in the world, beating the U.K. It’s the opportunity that attracts millions of newcomers to live and start businesses here. Most tech startups for instance launch in the Bay Area despite the high cost. Employment and wages have grown and that has put pressure on the California housing market.
The good news for buyers is that buyers will get an opportunity to negotiate again and, with fingers crossed, the interest rates will remain low for the end of the year. For sellers this all means we need to keep expectations in check and notice the list price difference to the actual solds in specific markets. If you live in the Santa Clara county and want to cash out now, don’t be greedy. If you’ve owned your home for over 5 years, you’ve got a lot of equity in your home and this might be a time to sell. In Santa Clara and Santa Cruz county we’re still experiencing a sellers market, but many properties are not listed appropriately will sit for longer days on market and with more properties on the market to choose from this is great news for new buyers who were a little spooked from past real estate markets.
If you’d like to further discuss the experience of first time homeownership or real estate investment locations, text me and we can meet at your favorite coffee shop. These are exciting times ahead for you, now’s the time to be pro-active and start your new life, call me today and let’s take that first step together.
Call/Text me and let’s discuss your real estate goals for 2019 today
over coffee and a snack! 🙂
Lynne Watanabe MacFarlane, Realtor