Buying
#Fastfacts about Millennial Home Buyers
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
How Long Will It Take To Sell Your Home?
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.
Trends to Watch in 2017
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.
The Largest Group Entering the Market Right Now
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.
This Simple Plan to Boost Your Credit Score May Surprise You
We’ve all been there. Well, hoped we be there. We’ve all set timelines for ourselves and thought, “I should have xyz by now” or “I thought I would be in a position to do xyz.”
One of those variables may have been buying a house this summer. You’re hoping to stop wasting your money on rent and start putting money into your own asset, but a few hurdles got in the way. One of them may be your credit score.
Of course, there are many steps to take before you even begin looking for a home and for most of us, that’s going to be obtaining a loan of some sort and finding out how much you can borrow. This will be heavily determined by your current income, down payment and credit score—which is where some people fall short and give up.
To get a loan, and to get a loan quickly, you as a potential homebuyer need to keep an eye on your finances and credit.
Our experience over the years of working with preferred and qualified lenders has supplied us with a list of basics for you to refer to when monitoring and building your credit.
- Always, always pay on time. No lender likes to lend money knowing that an individual has a repeated record of skipping payments. This indicates a lack of discipline and poor financial management. If it’s just a matter of discipline, enroll in AutoPay, set a calendar and keep track of what you owe and when. This can account for up to 40% of your FICO score.
- Keep a good debt-to-income ratio. Someone with a good ratio has unsecured outstanding credit that is below 50 percent of their annual salary. Try keeping your credit card balances within half of the allowed limit. If your limit is $10,000, restrict your statement to $5,000.
- Pay high interest loans first. Typically, personal loans have the highest interest, so it’s wise to pay those off first since they don’t create any type of asset for you. Home loans, on the other hand, are an asset and can be paid off over a longer period of time.
- Check your credit report. This can be done at minimal cost or you can obtain it from the official FICO site. Checking at least once a year will help you seek any clarification that is needed or allow you to correct any mistakes that have been made.
- Let them know if you can’t pay on time. Most often, people know in advance if they’re going to be late on a payment. If you do, taking action to notify the institution can reduce any penalties or late fees and make a good impression.
This will all take time, but if home ownership is your goal, use these tips to help build your credit and obtain a loan more easily.
Baby Boomers vs. Millennials
Two demographics influencing the housing market are baby boomers and fist-time buyers plagued by student loan debt. Both groups are leaving stagnant markets and low turnovers.
Baby boomers themselves control about two-thirds of the nation’s aggregate home equity, which computes to about $8 trillion. Whether they decide to move from their current place, downsize or age in place, the cumulative impact of their decisions on mortgage demand, housing options to Millennials and other aspiring homeowners will be substantial.
In a recent survey by Freddie Mac, 63 percent of respondents age 55 and over prefer to age in place, which computes to 42 million homeowners spread out across the entire 55+ demographic. These numbers suggest baby boomers’ housing decisions over the next few years “will take our market to brand new places.” says Freddie Mac Economist Sean Becketti.
Not only are baby boomers staying put, so are Millennials buried in student debt. Nearly three-quarters of people who are repaying student loans say their debt is hindering them from buying a home, according to surveys released by the nonprofit American Student Assistance.
More staggeringly, nearly half of those surveyed said their debt is expected to delay their home buying for at least five more years.
The housing market feels these affects keenly, as the homeownership rate among the 35-and-younger crowd has plummeted from 44 percent at the height of the housing boom to 34 percent today.
Getting the Right Representation When Buying A Home
So, you’ve decided to do it. You’ve set a goal, set your budget and location, got pre-approved and you’re ready for it. You’re doing it. You’re going to buy a home.
Now what? A home purchase is a significant and expensive transaction with long-term implications. You want to buy wisely, at the right price and on good terms. But if you overpay for a home or buy one that involves more upkeep than you can manage, you may end up with buyers remorse.
In order to make the best decision on buying your home, you need to have the best possible information and guidance to make a well-informed decision from someone who’s fiduciary duty is to you solely. Using an Exclusive Buying Agent provides you with the level of representation you need to make sure you aren’t overpaying, overlooking the upkeep, or buying on bad terms. This also helps to avoid any conflicts of interest.
An Exclusive Buyer’s Agent is just that: a real estate professional branded towards representing homebuyers exclusively. Compare this with a dual agent, or sellers agent, who’s vested interest lays across multiple platforms—to the seller and to the homebuyer.
An Exclusive Buyer’s Agent will:
- promote and protect the interests of the buyer with the utmost good faith, loyalty and fidelity, by law
- educate you on local market conditions and the home buying process in general
- perform cost comparisons to protect you from overpaying
- negotiate price and terms exclusively on your behalf
If an agent gives you dual agency disclosure, they aren’t representing you. Conflicts of interest arise when a selling agent represents both the buyer and the seller, and still carries a fiduciary duty to the sellers, which means you don’t get the best deal possible. If you meet a seller’s agent at an open house, for example. and mention to them your need to relocate in one month’s time, that agent must promote the interests of the seller by law and inform the sellers of your situation, thus diminishing your negotiation power.
Barn Doors, Farmhouse Sinks and Subway Tiles
Location, location, location. When it comes to the desirability to real estate, we’ve always known location to the most important element. But, times are changing. Thanks to HGTV, Instagram, Pinterest and, well, the Internet, key home features are becoming just as important as location.
Close your eyes. Imagine a quaint home, with a rustic barn door, white shaker cabinets and a big farmhouse sink. Chances are, you’ve already imagined it yourself, or are even seeking it out.
In a study of more than 2 million listings across the US between January of 2014 and March of 2016 by Zillow, homes with listings including keywords like “barn door”, “shaker cabinets” and “subway tiles” sell for a price 13% higher than expected.
Among other terms analyzed, quartz, craftsman and exposed brick came in behind shaker, farmhouse sink and barn doors in those terms associated with not only the highest sale premium, but also a significantly faster sale. “Barn doors”, for instance, helped listings move 57 days faster than expected, according to the study.
We hear it all the time, “We’ll replace these french doors with barn doors, paint the cabinets white and put in quartz countertops.” These now classic design elements add charm and character, so it’s no wonder these are in demand.
If you’re planning on putting your home on the market, looking to add value, or looking to appeal to potential homebuyers, try these GT Tips:
- The appeal of barn doors, aside from the actual intended use, stems from the rustic and reclaimed element. Try reclaimed adhesive wood paneling to give your home a rustic, reclaimed vibe, without the commitment of a large barn door.
- Many potential homebuyers are going to be looking for white, shaker style cabinets. If your cabinets aren’t shaker, try a fresh coat of paint. Our current favorites are Benjamin Moore’s Simply White and White Dove, for a cleaner or warmer white.
- If you currently have an overmount, or undermount sink, installing a farmhouse could be tricky. You’ll want to ensure that the base cabinet underneath has low enough framing to support the front apron, as you’ll need to cut into it. Hiding and stacking dishes is easier in a deeper sink, too!
Beat Out the Competition With A Winning Offer
You’re ready to buy a home. You even find one that you love 2 weeks into your search and even offer 5 percent over the listing price, just to make sure it’s yours and no one else’s. Then your real estate agent calls: 12 other offers had been made, and yours isn’t even in the top three.
When inventory is low, competition is stiff. A seller’s asking price becomes just that: an asking price. A seller may choose to price their home well below what the market will bear, with hopes of attracting multiple offers. As a potential buyer, you may be forced to compete with other buyers in a bidding war. Here are a few tips to beat the competition.
Make sure you’re working with a good agent that “gets it”. A seller is looking for a sure thing and a smooth, clean escrow. Experienced agents have relationships with inspectors, contractors, mortgage brokers and appraisers to help facilitate this process, not to mention good standing relationships with other agents. When faced with multiple offers, a seller, guided by their agent, may choose to work with a lower priced offer because that buyer has a good agent.
Get your financing in order before making an offer. This means being pre-approved for a loan and staying in regular contact with your lender during your search. You’ll need to be ready to move as soon as homes hit the market, having a pre-approval letter and financing in order will help you present yourself as a strong, motivated buyer.
When the opportunity comes, don’t wait. We hear this all this the time, “I wish I hadn’t waited on ‘Bleaker St’. Now it’s gone.” The buyers who don’t rest on their laurels get the home. If you’re serious about buying and have your financial ducks in a row, don’t wait for the open house, don’t wait for your husband’s mother to fly in from Utah to see it. Knowing what you need, and knowing what you want are two different sets of lists. If you see a home that meets your criteria, it’s likely that it won’t be there in two weeks, so be prepared to act fast.
Our Easy Guide To Increasing Your Home's Value This Selling Season
We’ve all heard the old adage that success is the result of preparation and opportunity. If you’re thinking of selling your home in the next few months, you’re probably hoping for a bit of success when it comes to listing your home. You hope that it will show well, you hope to get offers quickly after it hits the market and you hope for a smooth transaction. We can give you those opportunities, but if you want success, follow our easy guide to increase the value of your home and prepare for this year’s selling season.
- Organize, clean and declutter. This probably falls under that list of things you’ve been meaning to do since last year, but having a clean and clutter free space is of paramount importance. Not only does it lend the notion that the house has been well-maintained, but also that it’s bigger in size. GT tip: when it comes to closets, if you can’t see the floor, or the back of the closet, you have too much stuff. Take this opportunity to decide what’s going to the new house, and what’s going in the garbage.
- Lighting is everything. Any decent real estate agent is going to run around and turn on the lights before their homebuyers walk through the door. Not just because it feels more like a home, but also to see the dark areas better. Ideally, you’ll want three sources of light: overhead lighting, task lighting, and ambient lighting. Make the investment in recessed lighting in the common rooms if there isn’t any. Add task light lamps to bedside tables and desks, or pendants above dining tables and kitchen sinks, and add mood lighting such as art lights or dimmers. GT tip: use halogen, or spot light bulbs, as opposed to flood lights, in your recessed cans during the time it’s on the market. Spot lights produce a narrow beam of light, and can completely transform the look of the house.
- Get an inspection. Knowing what repair requests a buyer might make ahead of time can add huge value to your home and make it far more appealing. An inspector can point out any plumbing leaks, electrical problems, leaky windows, furnace issues. This could save you a lot of time and money down the escrow road.
- Paint. You don’t want homebuyers pulling up to your house only to be disappointed that their realtor brought them here. You want them to be excited to see what’s inside. The biggest point of reference is going to be the exterior facade of the house. Most homebuyers are going to be ok with painting an interior room here or there, but not the whole house. A fresh coat of exterior paint will help add that wow factor. GT tip: make your home stand out in photographs online by balancing light and dark colors on the outside. A light neutral color paired with a darker trim is bound to be eye catching when homebuyers are flipping through homes online. If your interior walls are pink or yellow, we commend you for trying to select a neutral shade, but if it dominates the whole interior, you’re better off painting it.
- Replace dirty and worn out carpet. You may have chosen shag carpet 10 years ago for it’s style and comfort. Chances are, it’s worn down and the dog has had a few accidents. Choosing an inexpensive carpet as replacement is sure to add value to your home that buyers can see firsthand. GT tip: choose carpet that’s in stock. It’s generally less expensive, and has shorter lead times.
- Improve the most important rooms. The kitchen and the master bathroom are generally considered the two rooms that homebuyers are most attracted to. This doesn’t mean you need to take out a loan to renovate the kitchen, it just means do a bit of updating–paint the cabinets, replace outdated countertops with a simple granite, and add stainless panels to any black or white appliances. GT tip: use adhesive title setting matts for an easy way to update your backsplash.