BuyersMortgage RatesReal Estate June 16, 2020

Three Reasons Homebuyers Are Ready to Purchase This Year

A recent survey by Lending Tree tapped into behaviors of over 1,000 prospective buyers. The results indicated 53% of all homebuyers are more likely to buy a home in the next year, even amid the current health crisis. The survey further revealed why, naming several reasons buyers are more likely to move this year (see graph below):

Lynne MacFarlane's Blog, topic is why many buyers are likely to purchase in the next year

Let’s break down why these are a few of the key factors motivating buyers to actively engage in the home search process, and the corresponding wins for sellers as well.

1. Low Mortgage Rates

The biggest reason potential homebuyers indicated they’re eager to purchase this year is due to current mortgage rates, which are hovering near all-time lows. Today’s low rates are making it more affordable than ever to buy a home, which is a huge incentive for purchasers. In fact, 67% of respondents in the Lending Tree survey want to take advantage of low mortgage rates. This is no surprise when comparing historic mortgage rates by decade (see below):

Lynne MacFarlane Realtor Blog discusses historic interest rates by decade

Sam Khater, Chief Economist at Freddie Mac recently said:

“As the economy is slowly rebounding, all signs continue to point to a solid recovery in home sales activity heading into the summer as prospective buyers jump back into the market. Low mortgage rates are a key factor in this recovery.”

  1. Reduced Spending

Some people have also been able to save a little extra money over the past few months while sheltering in place. One of the upsides of staying home recently is that many have been able to work remotely and minimize extra spending on things like commuting expenses, social events, and more. For those who fall into this category, they may have a bit more saved up for down payments and closing costs, making purchasing a home more feasible today.

  1. Re-Evaluating Their Space

Spending time at home has also given buyers a chance to really evaluate their living space, whether renting or as a current homeowner. With time available to craft a wish list of what they really need in their next home, from more square footage to a more spacious neighborhood, they’re ready to make it happen.

What does this mean for buyers and sellers?

With these three factors in play, the demand for housing will keep growing this year, especially over the summer as more communities continue their phased approach to reopening. Buyers can take advantage of additional savings and low mortgage rates. And if you’re thinking of selling, know that your home may be in high demand as buyer interest grows and the number of homes for sale continues to dwindle. This may be your moment to list your house and make a move into a new space as well.

Bottom Line

If you’re ready to buy or sell – or maybe both – let’s connect to put your plans in motion. With low mortgage rates leading the way, it’s a great time to take advantage of your position in today’s market.

Give me a call at 831.346.2743 text/cell

lmacfarlane @ intero . com

Let me know if there’s anything I can do for you! 

 

BuyersHomeownersinvestorstrendsWhy buy January 6, 2020

3 Benefits to Buying Your Dream Home This Year

3 Benefits to Buying Your Dream Home This Year

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.

Bottom Line
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

lmacfarlane@intero.com

831.346.2743 call/text

Lynne MacFarlane Homes

BuyersReal EstateSanta Cruz CountyWhy buy April 25, 2019

Attention Home Buyers – Here’s Why It May Now Be A Good Time to Buy

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!

Here’s why…

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! 

831.346.2743 cell

lmacfarlane@intero.com

 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!

831.346.2743 

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!

831.346.2743 cell

 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!

831.346.2743 mobile

 

 .   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

831.346.2743 mobile

lmacfarlane@intero.com

Buyers April 20, 2019

5 Top Reasons Why Young Renters Choose to Own

BuyersReal Estate March 29, 2019

10 Steps to Buying a Home

 

Some Highlights:

  • If you are thinking of buying a home, you may not know where to start.
  • Here is a simple list of 10 steps that you will go through to purchase a home.
  • Make sure to ask your agent for details about each step and what else may be required in your area!

*Give me a call, I’ll walk you through and explain the process in a step-by-step manner.

 

ArticlesReal Estate March 20, 2019

What Credit Score Do You Need To Buy A House?

There are many misconceptions about the credit score needed to buy a house. Recently, it was reported that 24% of renters believe they need a 780-800 credit score to be considered for a mortgage. The reality is they are misinformed!

Only 25% of the Americans have a FICO® Score between 740 and 800. Here is the breakdown according to Experian:

  • 16% Very Poor (300-579)
  • 18% Fair (580-669)
  • 21% Good (670-739)
  • 25% Very Good (740-799)
  • 20% Exceptional (800-850)

Randy Hopper, Senior Vice President of Mortgage Lending for Navy Federal Credit Union said,

Just because you have a low credit score doesn’t mean you can’t purchase a home. There are a lot of options out there for consumers with low FICO® scores,”

There are many programs available with low or no credit score requirement. The Federal Housing Administration (FHA) now requires a minimum FICO® score of 580 if you want to qualify for the low down payment advantage. The US Department of Agriculture (USDA) does not set a minimum credit score requirement, but most lenders require a score of at least 640Veterans Affairs(VA) loans have no credit score requirement.

As you can see, none of them are above 700!

It is true that the average FICO® score for all closed loans in January was 726, but there are plenty of people taking advantage of the low credit score requirements. Here is the average FICO®

As you can see, that number has been dropping for the last seven years. As a matter of fact, the average FHA Purchase FICO® Score reported in January 2019 was 675!

One of the challenges is that Americans are unsure about their credit score. They just assume that it is too low to qualify and do not double check. Credit.com confirmed that only 57% of individuals sought out their credit score at least once last year.

FICO® reported,

Since October 2009, the average year-over-year FICO® Score has steadily and consistently increased, from a low of 686 in 2009 to the latest high of 704 as of 2018.”

Here is the increase in the average US FICO® Score over the same period of time as the graph earlier.

Bottom Line

At least 84% of Americans have a score that will allow them to buy a house. If you are unsure what your score is or would like to improve your score in order to become a homeowner, let’s get together to help you set a path to reach your dream!

BuyersReal Estate March 15, 2019

Good News for Home Buyers!

Hello Buyers, are you there? Here’s some good news! A recent report shows that the percentage of houses sold including a bidding war before settling on a final price decreased from 53% in January of 2018 to 13% this year.

One reason for the decline is an influx of homes being listed for sale. Even though the month’s supply number is not increasing, the number of homes for sale is. The chart below shows the year-over-year change in inventory over the last 12 months.

Danielle Hale, realtor.com’s Chief Economist, gave some insight into why bidding wars are less common on a local level this year,

“[Last year] you might have been the only listing in your neighborhood, and you could put your home up at a certain list price and you would likely see multiple offers at or above that list price. That tide is turning this year.

It’s going to depend on what neighborhood you’re in, but we expect it to be more common this year that you won’t be the only listing.”

Inventory in the luxury and premium markets (the top 25% of listings in an area by price), is increasing at a greater rate than the starter home market. As the choices buyers have continued to increase, the likelihood of a bidding war will decrease.

Bottom Line

If you are debating listing your house for sale this year, you may not want to wait for additional competition as inventory continues to rise. Give me a call and let’s discuss your real estate plans, discuss a strategy over a cup of coffee today!