A recent study by realtor.com found that in 2017 nearly 52% of buyers will be looking to buy a home for the first time. A large portion of that percentage, in fact 42%*, will be made up by Millennials (ages 18 – 35) and growing. Millennials are starting to reach that critical home buying age and are actively searching for new homes. Many millennials are striving to fulfill the American dream. Similar to past generations, many feel that owning a home is a key part of fulfilling that dream.
Where are millennials home searching? One would think that living in the city would be the top choice location, however, it turns out that many are pursuing homes in the suburbs. A staggering 47%* of millennials live in the suburbs compared to just 33% who live in the city. Millennials are looking for larger homes with big yards plus the suburbs offer a safe neighborhood that they desire.
Despite the fact that millennials have grown up in a world surrounded by technology they still value human interaction. Most millennials prefer meeting with real estate agents in person compared to contacting them via email or phone. In addition, if they have a good experience with an agent, over 55%* of millennials are likely to recommend them to a friend and 26%* are likely to write an online review.
Over all, it is important to meet the needs of millennials as they start to enter the housing market.If you are a first-time buyer talk to a GreenTree Properties agent about finding that perfect home. We can help alleviate the stress and make your first home purchase a smooth process. *source: Zillow.com
While the year unfolds and we watch as a number of potential economic policies from a new administration are signed into order, more insight into 2017’s housing market begins to unfold. Last month we talked about housing appreciation and interest rates. Now, experts are weighing on new trends for the new year.
Redfin is expecting 2017 to break the 2016 record as the fastest market on record, measured by the average number of days homes spend on the market before going under contract. In 2016 the typical house stayed on the market for just 52 days, about a week faster than in 2015 and the fastest year since Redfin began tracking in 2009. Redfin is also predicting 2017 to be even faster— data taken from demand for short-notice tours of homes for sale, including same day tours, and the number of home tours completed, which has grown 19 percent. Redfin also recognizes a new approach for many buyers, one that seeks an efficient transaction.
In 2016, Millennials showed no signs of their ability to influence the housing market. Now in the new year, experts are predicting that millennials and boomers will greatly move markets, the two largest American generations in history. Chief Economist Jonathan Smoke cited on realtor.com predicts that millennials alone will make up 33% of buyers in 2017 as they approach life stages that typically motivate people to buy homes: marriage, children, job security.
Fannie Mae and Freddie Mac have begun to back bigger mortgages for the first time since 2006, a major sign of recovery from the past housing crisis. This will make it easier for more homebuyers to qualify for a mortgage in higher-priced markets. While the new administration has alluded to many changes in the structure of Fannie and Freddie, we don’t imagine that happening until 2018, as Redfin reminds us of a lengthy and political process to repeal that charter. We also expect increases in the availability of low downpayment mortgages from big lenders. These larger institutions introduced mortgages requiring as little as 1-3% down, drawing more millennial buyers into the housing market.
All signs point a great 2017 for the housing market, with much buyer demand and new inventory.
One of the biggest questions on everyone’s mind when they’re selling their home is “How long will it take?” Putting your home on the market leaves a lot of uncertainty and can add some extra stress, especially when you’re trying to plan your next move. GreenTree agents gather market data and analyze the life of a listing in own your area, but you’ll want to consider these factors when asking how long it will take to sell your home (the last one may surprise you).
In real estate, everything comes down to location, location, location. Factoring in how long your home may sit on the market is no different than this basic principle. If your home is located in a sought after area—next to a great school, proximity to entertainment and convenience, or in an up and coming area—you may be in a fast moving sellers market. You’re GreenTree agent can give you data on the average age of similar listings in your area, as well as the longest listings, and why those listings might not be selling.
Consider price not just in terms of fair market value, but also in visibility. Homes that are priced properly typically see shorter market time but price can also be used as a marketing tool to attract buyers. Homes that are priced 10% over market value will typically appeal to 30% of the market, while homes priced at fair market value can attract 60%. However, homes priced 10% under market value have the opportunity to move quicker and field more offers from 70% of the market.
It’s often overlooked, but the quality of photographs used to portray your home could greatly affect it’s time on the market. Listings with substandard photos don’t drive internet traffic and could be off putting to buyers. Over 90% of home buyers use the internet to search for homes, so listing photos are crucial for making a good first impression. DSLR photos that are properly lit and showcase the features of the home without manipulating the house tend to attract more buyers, more offers and sell quicker.
If you’re thinking of selling, talk to your GreenTree agent about a custom strategy to get your home sold in the timeframe you want. The right combination of location factors, price point and marketing can help ease your stress and put more confidence into selling your home.
We’ve been looking at solar energy a lot these days, particularly roofs, and have even written about them before here on our blog. We look at solar panels as an investment on your home that will give you plenty of savings in the future and add value to your property. The biggest barrier to getting a solar roof is the cost of the equipment, in comparison to the benefits, so when Tesla announced a new solar roof that would cost less than a normal roof, we were floored.
The roof looks good, there’s no doubt about that. There are multiple finish options, including “Tuscan” and “slate”, which allows for a solar panel roof that actually looks like a normal roof. But aside from aesthetics, most of us are wondering if a Tesla Solar Roof is worth it. Namely, we’re more concerned about the return.
The cost of the roofs is estimated around $50,000, so when Tesla says it’s price point is around that of a “normal roof”, they mean a roof with high end materials. At this rate, it’s more a competitive alternative to other luxury solar installations, but with more of an unknown return.
Performance and efficiency are everything when it comes to solar equipment. The company itself has admitted that the aesthetic reduces efficiency by 2%, which is a lot. Tesla’s panels are actually roofs, or “roof integrated”, unlike other panels that are mounted to the roof. This design doesn’t allow for airflow between the panels and the roof and thus reduces energy and efficiency. Also, because of the design, you wont be able to install around shaded areas, which will lower your production output. There’s even a lot of talk about fire hazards because of the roof integrated design.
We certainly admire the look of Tesla’s new solar system, and are excited to see these concerns addressed over the years, as we know they will be. If you’re thinking of adding solar energy to your home, let us know, we’d be happy to share our experiences with you.
The past year has shown us a multitude of trends in the housing market—higher home prices, housing shortages, developer confidence and rising rent prices. For 2017, we’re thinking three things: locations, appreciation and interest rates.
Urban areas are appreciating much faster than suburban areas, accounting for growth, and small homes have seen much sharper price growth than larger ones. Nationally, home prices are expected to keep rising by 3.5% according to Moody’s Analytics projections. If you have a smaller home in, say, a downtown area, your equity is going to take you further. As home prices rise, more buyers will inevitably move to the suburbs to find affordable housing.
If you’re looking to trade for a larger home, you’re in the market’s sweet spot, and the first part of 2017 is going to be the best time to strike for that. The equity from your small house will get you more—the average price on a two-bedroom house climbed 59% nationwide, while four-bedroom houses rose by about 41%, according to more of Moody’s Analytics. Developers have also continued to add new inventory to the market by building new supply in demanded areas with price points between $500,000 and $750,000. So, if you’re selling a smaller home in the first part of 2017 for an upgrade, you’ll want to choose higher priced offers over offers with quicker closing times. The more cash you have to put towards that down payment, the better off you’ll be.
Following the housing market crash, mortgage rates remained at record lows for years. Rates are expected to rise to more normal levels, levels seen before the market crash. The Federal Reserve has already indicated that three more increases to its benchmark rate are coming in 2017. It’s only advantageous to act sooner rather than later if you’re thinking of buying or selling, especially since future housing policies remain unclear.
Earlier this week, Airbnb, an online homestay network that allows people to list or rent short-term lodging in residential propreties, announced it’s recent expansion to experiences, not just accommodation. The website now gives hosts the chance to offer tours, so people can buy packages such as a guided tour or cultural experience. While the debate over short-term rentals is raging in all of America’s, we wonder about the opportunities for landlords and property owners, as well as the drawbacks to neighbors.
The cost of an Airbnb varies—by location, demand, time of year, size—but is always set by the property owner. A property owner can rent out a room, a sofa, a bed or an entire home. There are more than 2,00,0000 listings in 34,000 cities and 191 countries, and growing.
Property owners see the appeal in short-term rentals. The owner of an apartment can rent out that unit for $2,000 per month, or rent it on Airbnb for $150 per night. Some owners own and rent multiple properties through Airbnb and make upwards of six figures per year. At 90% occupancy, a homeowner can make about $4,000 per apartment on Airbnb. If such owner pays about $2,000 of that in rent and utilities, that comes out to $2,000 profit per month, per apartment, or $24,000 per year, multiplied by ‘x’ number of apartments.
The legalities of short-term rentals through Airbnb are still being processed and sorted, namely when it comes to rights. Entrepreneurial landlords have the right to make a buck, while neighbors have the right to maintain the atmosphere of their locale. Some apartment buildings prohibit brief sublets by tenants who might want to earn extra money while they’re away—a landlords right to prohibit that. There are also controversial issues arising over taxes—full time rentals acting as hotels but not paying hotel-like taxes.
In vacation spots like San Clemente, Dana Point and South Orange County as a whole, Airbnb listings are rampant. The opportunities for property owners, or would-be property owners, are huge. If you’re thinking of purchasing an investment property with short-term rentals in mind, check with your GreenTree real estate agent to see which areas allow, or don’t allow them.
When the market is strong, as it is now rolling into 2017, basic principles of supply and demand start to surface and weigh in the real estate market. With current demands, inventory has been historically low during the previous year, which is why new developments offer homebuyers new opportunities to own property in desirable areas.
Over the years, we’ve worked with homebuyers in their search for newly constructed homes. One of the drawbacks we often encounter is the proximity to basic amenities—Target, Costco, Sports Parks, etc. The new Avenida La Pata Extension in San Clemente is changing the game, and the opening of the much anticipated Rancho Mission Viejo development is alleviating buyer demand.
Rancho Mission Viejo is a new master-planned community in South Orange County. Located just 2.5 miles from downtown San Juan Capistrano and 5 miles from coastal attractions of San Clemente and Dana Point Harbor, RSV is a collection of 12 neighborhoods, including inter-generational housing, ranging from the $300s to the 1.0Ms.
We recently spent a few days at the developments at Rancho Mission Viejo and the best part is also what sets it apart from other developments—the amenities. RMV’s Ranch has “plenty of places to exercise, retreats to relax, trails to explore and more.” The Esecnia Farm features crops, planter beds, orchards and even a chicken coop. Canyon Coffee at The Canyon House is the neighborhoods very own coffee shop, brewing Peet’s Coffee and catering kitchen with a large activity lawn. There are even plans for a daycare center, with infant and toddler supervision planned down the street from the Esencia K-8 grade school.
Strong market conditions, new road extensions and price points to fit every new buyer, Rancho Mission Viejo is a favorable option for those of us in the market. For more details, or to learn more about buying a newly constructed home, ask your GreenTree real estate agent.
A lot of our clients ask about buying a newly constructed home. They often weight the pros and cons of buying new vs. buying old, and we’re happy to be able to steer them along that road.
But many ask, if I buy new construction, am I still able to work with a realtor?
They answer is, yes. In fact, you should be working with a realtor that does not have relationships or ties to the builder. This will allow the realtor to have your best interest in mind, and protect that interest.
Model homes are typically staffed by a real estate agent, employed by the builder and tasked with a specific goal. These reps represent the builder, as they are contractually obligated to do so. It’s important to have an agent to represent you that can advise you on how to structure your offer and in making choices that can affect your home’s resale value.
If you’re thinking of touring a new construction, don’t walk into the sales office without your agent. Some developments have site registration policies that require your agent to accompany you on your first site visit. If you walk in without them, you won’t be able to have the support of your agent during the transaction.
Your real estate agent is going be trained in negotiations, and can help with negotiations for possible upgrades or credits towards:
– flooring, stone materials and finishes
– contract terms
– warranty packages
– closing costs from the in-house lender
Buying new construction is a complex process with many moving parts. An experienced agent will also have the know-how to keep the transaction and construction on track. Depending on factors such as size, weather and the builder itself, your agent is going to be there along the way to let you know what to expect and how to navigate the process.
Talk with your real estate agent before visiting a new construction site and make sure you get the representation you need for the process.
They’re called boomerang borrowers, and they could be changing the housing market in the coming months and years.
The timeframe for borrowers who were significantly hit after the Great Recession between 2007 and 2010 to improve their credit score is about the happen, opening the door for a lot of consumers to re-enter the housing market.
Foreclosures, short sales, and bankruptcies remain on a credit report for seven years, which means these items are due to fall off the credit files of 2.5 million consumers by June 2017, the largest of the group over that time frame.
With millions of borrowers coming back into the housing market, should this be the time to sell?
Consider low inventory. There is a shortage of homes for sale in many markets throughout the country in relation to buyer demand. This is economics 101 and happens to create a highly desirable atmosphere for sellers to obtain the best possible sale price and terms. According to Redfin, buyer demand rose by 13.3 percent over the month in September, it’s highest level in three-plus years. We’ve seen buyer demand gain momentum since Labor Day, when a pop of fresh listings hit the market.
Home prices are on the rise after several years of dealing with distressed and foreclosed inventory. As of August 2016, foreclosure inventory included only 0.9 percent of all homes with a mortgage. As foreclosures drop, home values rise, which could mean higher appreciation for home owners.
Low interest rates hovering around the 3.5 to 3.7 percent range make the cost of borrowing money extremely attractive, especially for those boomerang borrowers who are re-entering the market with now above average credit. Modern day loan programs offer a wide variety of options to buyers at various price points and stages to purchase property, so you know that when you accept an offer, the loan process isn’t going to diminish on your buyer, thus securing your sale.
Chances are, it’s been a while since you’ve sold your home—at least 7-10 years. Predictive analytics help optimize buyer searches. Social Media marketing brings visibility to a whole new level. Drones and video tours help create powerful story telling campaigns. All done to attract buyers across the market and secure sales. Welcome to modern day real estate!
Make yourself ready for boomerang borrowers by preparing your home to show in the best light possible. Talk with one of our real estate professionals if you’re thinking of selling your home and find out what they can do for you.
Whether you’ve just moved in or you’ve been settled for a while, consider these GT Tips before you’re next hard surface flooring installation.
- Decide whether you’re keeping the baseboards or getting new baseboards. Most flooring types require a small gap between the wall’s edge and the flooring’s edge, as with hardwood, to allow for movement. If you’re keeping your existing baseboard, you may need a quarter round to cover this gap.
2. Is it level? The foundation, that is. What you can’t see may hurt you. Any major divots in the flooring may compromise the floor’s integrity, especially tile. Uneven flooring could lead to cracks and breaks that cost money to repair. If you’re demo’ing old floors, allow for time in between the demolition of the old floor and installation of the new in case repairs need to be made to make the floor even.
3. Are you installing on a second story? Many bathrooms using tile are going to be located upstairs, which means you’re going to need a waterproof subfloor when it’s installed on say, plywood. When wood gets wet, it swells and could likely break or crack your tile. A cement board will help ensure that this doesn’t happen, just be sure to think about this material when budgeting your project.
4. Consider the pattern. If you’re installing hardwood floors, or plank style tile, you’ll typically want the pattern to run the length of the house, to make hallways and other longer rooms look larger. More complex patterns, such as herringbone, may require more material to allot for more complex cutting.
5. Know your grout. There are two types of grout, non-sanded and sanded. Typically, sanded grout is using for flooring, while non-sanded grout (grout without sand) is used for walls.
6. Seal it. Natural stones such as slate and granite are going to require a sealant every six months. Without it, a white film could develop over the tile and diminish the sheen.